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ORGANIZATION AND MANAGEMENT

PLANNING
 Planning is the first and essential management function.

Importance of Planning:

 Provides direction to managers and employees.


 Reduces uncertainty by anticipating future events and changes.
 Minimizes wastes through proper coordination and efficiency.
 Establishes goals and standards, enabling control in management.

Difference Between Goals and Plans

 Goals: Targets or desired outcomes.


 Plans: Actions or means to achieve goals.
 Sequence: Goals precede plans; planning starts with identifying goals.

Types of Plans

1. Strategic Plans: Broad, organization-wide goals. Set by top management (CEO, president).

2. Operational Plans: Narrow focus on specific areas or units. Essential for achieving broader goals.

3. Long-Term Plans: Cover more than three years. Promote clarity and alignment among all
organization members.

4. Short-Term Plans: Cover one year or less. Support long-term goals and are handled by
department/unit heads.

5. Directional Plans: Flexible, provide general guidelines. Must align with strategic goals.

6. Specific Plans: Clearly stated, leave no room for misinterpretation.

7. Single-Use Plans: Used for unique, one-time projects.

8. Standing Plans: Ongoing, guide repetitive activities. Often part of operational strategies.
Planning Levels

1. Strategic Planning: Handled by top-level management.


 Focuses on long-term goals and strategies.
 Goals include maintaining stability, promoting growth, improving productivity,
profitability, and efficiency.
 Strategic planning involves the CEO, presidents, or senior executives, supported by a
management team.
2. Tactical Planning: Handled by middle-level management.
 Translates broad strategic goals into specific unit-level goals.
 Focuses on major actions needed within a department/unit to contribute to strategic
goals.
3. Operational Planning: Handled by frontline/lower-level management.
 Translates broad strategic goals into specific unit-level goals.
 Focuses on major actions needed within a department/unit to contribute to strategic
goals.

Planning Techniques and Tools and Their Applications

1. Forecasting
 Predicting future events or conditions to guide planning.
a. Types:
Qualitative Forecasts: Based on expert opinions.
Quantitative Forecasts: Based on statistical and mathematical analysis.
Caution: Forecasts are predictions and may be inaccurate due to human judgment
errors.
2. Contingency Planning
 Prepares for unexpected events or when things go wrong. Includes "trigger points" that
indicate when to implement alternative plans.
3. Scenario Planning
 A long-term version of contingency planning.
 Involves identifying possible future scenarios and preparing alternative plans to address
them.
 Examples of scenarios: Climate change, environmental issues, human rights challenges.
4. Benchmarking
 Comparing company practices with those of others to adopt successful strategies.
 Types:
External Benchmarking: Learning from other organizations’ best practices.
Internal Benchmarking: Encouraging units within the organization to share and adopt
best practices.
5. Participatory Planning
 Involves including those affected by plans and those responsible for implementing them
in the planning process.
 Benefits:
• Encourages creativity.
• Promotes acceptance and understanding of plans.
• Fosters commitment to successful implementation.
Decision Making

 Choosing among possible alternative actions. It is a fundamental managerial function and


requires careful consideration.

Types of Decision Making

1. Structured/Programmed
a. Decisions Repetitive and routine decisions.
b. Applied to structured, familiar, and easily defined problems.
c. Example: Handling a customer complaint about dirty utensils in a restaurant using
standard procedures.
2. Unstructured/Nonprogrammed Decisions
a. Unique and non-recurring decisions.
b. Applied to unstructured, new, or unusual problems with incomplete information.
c. Example: Deciding whether to open a new hotel branch in another city.

ORGANIZING
Nature of Organizations

 Definition: Division of labor and specialization within an organization.


 Division of Labor: Assigning different tasks to different people in various work units.
 Specialization: Assigning specific tasks to individuals or units based on their expertise.
 Result: The larger and more complex the organization, the greater the division and
specialization required.

Integration of Work Units

 Definition: Collaboration and coordination among various work divisions or units.


 Coordination: Procedures that connect work activities across units to achieve the
organization's overall goals.
 Need for Integration: Increases as differentiation (specialization) grows. Structural
 Mechanisms: Tools and procedures designed to enhance collaboration and coordination.

Types of Organization Structures

Organizational structures define tasks, workflows, reporting relationships, and


communication systems.
1. Vertical Structure
 Focuses on authority, responsibilities, and reporting relationships.
 Authority Rights: Owners of private companies have absolute authority. In
corporations, authority lies with the board of directors, which oversees
organizational decisions.
 Hierarchy:
 CEO: Accountable to the board.
 Middle-level Managers: Manage departments and report to top-level
managers.
 Lower-level Managers: Supervise and report to middle-level managers.
Employees: Report to lower-level managers.
2. Horizontal Structure
 Organizes tasks into smaller work units (departmentalization).
 Types of Departments:
 Line Departments: Directly manage production, sales, and services.
 Staff Departments: Provide support services (e.g., legal, research, PR).
 Approaches to Departmentalization:
 Functional Approach: Divisions by specialized activities (e.g., marketing,
finance).
 Divisional Approach: Divisions by products, customers, or geographic areas.
 Matrix Approach: Hybrid system where personnel report to both functional
and divisional managers.
3. Network Structure
 Comprises independent organizations/companies collaborating to deliver products or
services.
 Features:
 Specialized and independent entities (e.g., production, design, distribution).
 Electronic communication facilitates rapid information sharing and
responsiveness to customer demands.
 Advantages: Flexible and highly responsive to market needs.

Organization Theories and Applications

 Simple
 Functional
 Divisional
 Team Design
 Matrix-Project Design
 Boundary-less Design

Delegation

 Assigning a new or additional task to a subordinate.


 Accomplishing work through others by granting them the authority to make decisions and
take actions.

Steps in Delegation

 Define the goal clearly


 Select the right person
 Assign responsibility
 Discuss planned approach
 Grant authority
 Provide time and resources
 Monitor progress
 Confirm task completion
Formal and Informal Organizations

 Formal Organization

- Created by the company owner or manager to help the firm achieve its goal.

 Informal Organization
- Formed based on friendship or shared interest among members.

STAFFING
Definition and Nature of Staffing

 process of attracting, hiring, and retaining qualified individuals to fill organizational roles

Forces Affecting Human Resource Needs

1. External Forces:
a. Economic conditions
b. Technological advancements
c. Social, political, and legal factors
2. Internal Forces:
a. Organizational goals and objectives
b. Technology and types of work
c. Salary scales (can impact turnover and recruitment)
d. Existing workforce dynamics

Recruitment

 a set of activities designed to attract qualified applicants for job position vacancies in an
organization
 External Recruitment

– recruitment from outside sources

 Internal Recruitment

– recruitment done within the organization

Methos of Recruitment

 Advertisements
 Unsolicited applications
 Internet recruiting
 Employee referrals
 Executive search firm
 Educational institutions
 Professional associations
 Labor unions
 Public and private employment agencies

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