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Principles of Business, Marketing, and Principles of Business, Marketing, and FinanceFinanceLesson ThreeLesson Three

Business Operations and Organizational Structures Business Operations and Organizational Structures

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Business Organization and ManagementBusiness Organization and Management

• How a Company is Run• Managerial Structures

– Organizational chart-shows how the business is structured and who is in charge of whom

– Line authority-managers at the top of the organization are in charge of those beneath them

– Centralized organization-gives authority to a number of different managers to run their own departments

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Types of Organizational Structure


Guidelines for BusinessesGuidelines for Businesses

• Mission Statement-short specific reason why the business exists and what it wants to achieve

• Goal-precise statement of results the business expects to achieve

• Policies-guidelines used in making consistent decisions

• Procedures-descriptions of the way work is to be done


Principles of Effective Principles of Effective OrganizationOrganization

• Responsibility-the obligation to complete specific work

• Authority-right to make decisions about how responsibilities should be accomplished

• Accountability-taking responsibility for the results achieved

• Unity of Command-clear reporting relationship for all staff of a business


Principles of Effective Organization


How Departments are How Departments are OrganizedOrganized

• By function

• By product

• By location


Levels of ManagementLevels of Management

• Top Level Managers– Set goals– Plan for the future

• Middle Managers– Carry out the decisions of top

management– Plan and control operations

• Operational Managers– Oversee daily operations– Supervise workers to meet

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PlanningPlanning

• Long-range planning-top-level management decides how the company should perform

• Planning Questions Management Must Address– What must be done?– Who will do it?– How will the work be grouped?– Who supervises whom?– Who makes decisions about the work to be done?


Questions of the Planning Questions of the Planning ProcessProcess

• Applied and answered when leaders meet with the management team


OrganizingOrganizing

• Assign managers different tasks

• Coordinate activities of managers

• Each manager organizes his/her department and knows what other managers are doing

• Must determine who makes decisions and who answers to whom


LeadingLeading

• Set Standards

-so managers know their goals

• Communicate with Managers

-to provide guidance and resolve conflicts

• Encourage Employees

-offer incentives such as pay raises and promotions


ControllingControlling

• Keeping the Company on Track-to meet all goals– Keep track of the budget, the

schedule, and the quality of the product

– Monitor employees and review their performance

– Monitor customer satisfaction


ManagersManagers

• Most Managers– Begin their careers as company employees– Are promoted after they have gained experience and

have shown leadership qualities

• Managerial Qualities– Ability to perform varied activities– Ability to work under pressure– Effective communication– Interpersonal skills– Ability to gather and use information


Advantages Associated with Advantages Associated with Being a ManagerBeing a Manager

• Higher earnings• Prestige• More influence on how the

company is run• Greater control over

personal time


Disadvantages Associated Disadvantages Associated with Being a Managerwith Being a Manager

• Take the blame when things go wrong

• Wrong decisions are costly and can affect numerous employees

• Can have an adverse affect on relationship with lower-level employees


TeamworkTeamwork

• Collaboration is important• Flexibility, creativity, good

communication, shared goals

• Work as a team-to accomplish company goals

• Brainstorm for solutions• Listen to team members


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