Areas of Management

AREAS OF
MANAGEMENT
What is Strategic Management?
Strategic Management consist of the

analysis, decision and actions a
organization undertakes in order to create
and sustain competitive advantages.
Importance of Strategic Management
Strategic management serves as a

direction in determining on how a firm
should compete strategically which
involves the planning and decision making.
Strategic Management Process
Step 1. Identify Organizational Mission, Goals and

Objectives.
Step 2. Analyze Internal and External
Environment.
RESOURCES
ARE RARE
RESOURCES CORE RESOURCES

ARE RARE COMPE- ARE RARE
TENCE
Figure
1
GENERAL ENVIRONMENT
Factors external to an industry and usually

beyond a firm’s control that affect a firm’s strategy.
The general environment includes six segments,
the demographic, socio-cultural, political and legal,
economic and global (Dess, Lumpkin, & Eiesner,
2010).
COMPETITIVE ENVIRONMENT
The immediate environment surrounding a firm

it includes rivals, suppliers, customers (buyers,
new entrants and substitute products (Bateman &
Snell,2008).
THREATS OF
NEW ENTRANTS
BARGAINING BARGAINING
POWER OF RIVALRY POWER OF
SUPPLIERS BUYERS
THREAT OF
SUBSTITUTE
PRODUCTS
Figure 2. Porter’s Five Forces Model of Industry Competition
Step 3. Strategy Formulation

LEVELS OF ORGANIZATIONAL
STRATEGIES
Corporate Level Strategy

It is concerned with the direction of the
organization. It involves making decisions on what
business should the firm be in and wants to be in. Firms
may diversify in expanding their operations but should
still be based on the mission of the organization.
Three Basic Corporate Strategies
1. Growth Strategy
In the growth Strategy, the organization wants to create new opportunities
by expanding their operations.
 Concentration – This is the strategy where business expands its business
by increasing the production capacity or sales and operates on single
business and industry.
 Diversification – This is the process of expanding its operation or
new business through merging or acquiring either with related or
unrelated industries.
 Vertical Integration – This is the acquisition or
development of new business that produce parts or
components of the organization products.
2. Stability Strategy
This is a strategy that an organization use when they
wants to reduce the scope of their operations by eliminating
products or business units.
3. Retrenchment Strategy
This is a strategy that an organization use when they
wants to reduce the scope of their operations by eliminating
products or business units.
BUSINESS LEVEL STRATEGY
This strategy deals on how an

organization will compete in a
particular industry.
Three Generic Strategies
1.Overall Cost Leadership Strategy – designed to

build and deliver product or service for a lower cost.
2.Differentiation Strategy – designed to create
differences in product or service offering.
3.Focus Strategy – designed to concentrate its
resources to a well-defined segment.
STRATEGIC BUSINESS UNIT (SBU)
Strategic Business Unit (SBU) is a distinct

business that has its own set of competitors and
can be manage reasonably independently of other
businesses. (Ghillyer, 2009).
BOSTON CONSULTING GROUP (BCG MATRIX)
HIGH LOW
GROWTH RATE
QUESTION
HIGH STARS MARK
CASH
DOGS
LOW COWS
MARKET SHARE
• Star- high growth rate, high market share.
• Cash Cow - low growth rate, high market
share.
• Question mark - high growth rate, low
market share.
• Dog - low growth rate, low market share.
FUNCTIONAL LEVEL STRATEGY
The third level strategy that managers use

deals with different functional areas of the
business to support the organization’s business
strategy. It also guides the use of resources.
Step 4. Implement Strategies
Step 5. Evaluation and Control
MANAGEMENT INFORMATION SYSTEM
Management Information System is also known

as MIS is designed to be used by managers to
provide them valuable information needed in
making decisions for the organization.
IMPORTANCE OF MIS
Any business needs to have a system to have

in managing all various information. This can be
manually organized or arrange in computer based
set up. System pertains to the arrangement of
interrelated elements that function to accomplish a
common purpose.
HUMAN RESOURCE MANAGEMENT
Human Resource Management is defined as

the productive recruitment, development,
deployment and motivation of people at work in
order to achieve strategic business objectives and
the satisfaction of individual employees. (Smith,
2011).
ATTRACTING WORKFORCE
- Internal Recruitment
- External Recruitment

THE RECRUITMENT PROCESS
1. Application Forms
2. Interview
- Structured interview
- Unstructured interview
3. Testing
4. Reference and Background Check
5. Physical Examination System
DEVELOPING WORKFORCE
1. Orientation
2. Training and Development
 On-the-job-training
 Off-the-job-training
3. Performance Management System
RETAINING WORKFORCE
Companies must able to retain qualified employees to

the organization. Especially when their contribution brought
positive change or success to the company. These
employees should be nurtured and managed properly. Some
methods are by providing them rewards and other factors
such as career development and work life balance which will
reinforce them to remain in the company.
ENTREPRENEURSHIP
It is the process of establishing a new

organization with a purpose of pursuing in
opportunity through value creation
IMPORTANT TERMS IN
ENTREPRENEURSHIP

Small Business - Business having fewer than 100
employees which is operated and independently owned with
a little impact on its industry and have a high failure rate.
Intrapreneurs - An entrepreneurial behavior of people inside
the organization is creating of a new enterprise inside the
firm using the resources of the company with a purpose of
creating a new product.
Entrepreneurial strategy – a strategy that enables a
skilled and dedicated entrepreneur, with a variable
opportunity and access to sufficient resources, to
successfully launch a new venture.
Entrepreneurial Venture – Organizations that are
pursuing opportunities are characterized by innovative
practices and have growth and profitability as their
main goals (Robbins & Coulter, 2004).
Business Plan – It is a written document that
summarizes a business opportunity and defines and
articulates how the identified opportunity is to be
seized and exploited by an organization (Robbins,
DeCenzo, & Coulter, 2011).
Franchising – An entrepreneurial alliance between a
franchisor (an innovator who has created at least one
successful store and wants to grow) and a franchisee
(a partner who manages a new store of the same
type in a new location) (Bateman, & Shell, 2008).
Family Businesses – A privately held firm where the
control remains within a family. (Dess, Lumpkin, &
Eisner, 2010)
First Mover Strategy – the competitive advantage
gained by the firm or organization by being the first to
introduce or develop a new process or product.
(Jones, 2007)

BUSINESS ETHICS
Business is the process of satisfying the needs and

wants of others in which other people is willing to provide
it for the purpose of earning a profit. Ethics can be defined
as a philosophical science that studies the morality of
human act. As a science, ethics is concerned with the
analysis of the nature of the human conduct from the
point of view of morality (Roa, 2007).
OPERATIONS MANAGEMENT
It is an area of management that deals in managing the

process in producing goods and services effiently and
effectively. It involves transforming inputs and outputs or
better known as I-P-O (input-process-output).
2 Types of Operation:
 The service operation and
 Manufacturing operation.

INPUTS
OUTPUTS
Raw
Materials, PROCESS
Goods and
Human
Services
resources,
Information
Feedback Control
Figure 4
OPERATION MANAGEMENT PROCESS
Operation of management is the heart of many

businesses. The success of every business is
based on how effectively and efficiently they were
able to manage their resources.
TYPES OF OPERATING SYSTEMS
SMALL BATCH
PRODUCTION
FLEXIBLE
PRODUCTION
LARGE BATCH
PRODUCTION
Figure 5
SMALL BATCH PRODUCTION
Small Batch Production also known as mass

production, is a type of system of operations that
organizations use specialized machines in its
operation to produce large quantities of
standardized products.
FLEXIBLE PRODUCTION
To attain flexible production, a more complicated

sequence of operation is needed to make a wide
variety of customized products. The key is the use of
computer in integrated manufacturing that it eliminates
the need to physically retool machines to produce
different or customized products (Jones, 2007).
OPERATION MANAGEMENT
Operation Management plays a vital role in

the organization. It helps the organization
achieve a competitive advantage.
Different Factors of Operation
Management
TOTAL QUALITY MANAGEMENT

Total Quality Management can be defined as
managing the entire organization to ensure that it
excels on all dimensions of products and services
that are important to consumer (Chase, Jacob, &
Nicholas, 2005).
INVENTORY MANAGEMENT
Organizations need to manage its inventory. This contributes to

the success of the business. Inventory is a store of goods that is
held by the organization.
Three Types of Inventory
 Raw materials
 Work-in process (products not yet completed)
 Finished goods
SUPPLY CHAIN MANAGEMENT
The central idea of supply chain management

is to apply a total system approach to managing
the flow of information, materials and services
from raw material suppliers through factories and
warehouses to the end customer (Chase, Jacob, &
Nicholas, 2005).
GROUP 5
TERCIO, JADE AMOR BAUTISTA, NORMANDY

BADUA, MA. CRISANTA ABELENDE, GERRICK
ABABA, ALEXIS MAY ARCEO, HAZEL MAE
MOSE, CARL ANGELO QUIRANTE,CINDIE
GARCIA, REYNALDO III DELOS SANTOS,
CHARLES NUHRAIN

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AREAS OF

Strategic Management consist of the

Strategic management serves as a

Step 1. Identify Organizational Mission, Goals and

RESOURCES CORE RESOURCES

Factors external to an industry and usually

The immediate environment surrounding a firm

Corporate Level Strategy

This strategy deals on how an

1.Overall Cost Leadership Strategy – designed to

Strategic Business Unit (SBU) is a distinct

The third level strategy that managers use

Management Information System is also known

Any business needs to have a system to have

Human Resource Management is defined as

Companies must able to retain qualified employees to

It is the process of establishing a new

Business is the process of satisfying the needs and

It is an area of management that deals in managing the

Operation of management is the heart of many

Small Batch Production also known as mass

To attain flexible production, a more complicated

Operation Management plays a vital role in

TOTAL QUALITY MANAGEMENT

Organizations need to manage its inventory. This contributes to

The central idea of supply chain management

TERCIO, JADE AMOR BAUTISTA, NORMANDY

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