CHAPTER 2

FUNCTIONS OF MANAGEMENT
 1) PLANNING
Planning - is the process of establishing objectives
and appropriate courses of action before taking action.
(Stoner)
Planning – is deciding in advance what to do, how to
do it, who is to do it, and how to measure performance.
(Hick and Gullet)
Plan – is a detailed and systematic method formulated
before hand before doing or making something.
 IMPORTANCE OF PLANNING
1)Minimization of uncertainty
- The uncertainty of the future of any
organization is almost always spawned by the inability
of management to foresee the future events that will
influence its survival and growth.
2) Economy of operation
- With planning, economy of operation is
assured through the identification of resources
needed.
3) Direction and Control
- With clear planning, direction and control are
distinctly provided for the guidance of people in the
performance of their duties and responsibilities to
achieve a given objective.
4) Detection of risks
- Early detection or the risks in an organization
enables decision makers to react on them instead of
reacting on the problems triggered by the risks as
they arise.
 PRINCIPLES OF PLANNING
1) Planning must be realistic
2) Planning must be based on felt needs
3) Planning must be flexible
4) Planning must be democratic
5) Planning must start with simple projects
6) Planning must include social responsibility
 WHY MANAGERS FAIL IN PLANNING?
1)Lack of real commitment in planning
- There is a lack of real commitment by
managers in planning.
- Management needs a climate that forces
people to plan.
2) Interchanging planning studies with plans
- Many organizations and people believed
they have planning when all they have are
planning studies.
3) Failure to develop and implement sound strategies
- Without a sound strategy, plans go in wring direction
- Unless a strategy is implemented by an action plan,
it
becomes only a statement of wishes and hopes.
4) Lack of meaningful goals and objectives
- Goals are clear and attainable
- They must be defined in the light of strengths and
weaknesses and the many internal and external
environment forces that may influence their
achievement.
5) Failure to see the scope of plans
- Some managers neglect to see that there are other
types of plans, objectives of goals, strategies, policies, rules
etc. as well as programs.
6) Too much reliance on experience
- Experience is likely to be a dangerous teacher simply
because what happened in the past may not likely fit a future
situation.
7) Lack of top management support
- Planning is not effective if top management does not
believe in it, encourage it, or make the necessary decisions
that will allow its subordinates to make their plans.
8) Lack of clear delegation
- It is obviously very difficult for people to plan if
they do not know that their jobs are, if they are
unaware of how their jobs relate to other, and if they
do not have clear authority to make decisions.
9) Lack of adequate control techniques and
information
- Planning can be difficult unless the people
responsible for these know how well they are working.
 TYPES OF PLANS
1)Corporate Plan – covers and integrates all major
and vital matters and issues which are directly
concerned with survival, growth and development
of the organization.
Ex. a) Initiation Plans – also known as Start-up
Plans, are drawn by an entrepreneur who is about to
venture into a business.
b) Strategic plans – help the organization
apportion their resources most optimally.
c) Growth plans – diversifying into newer territories
or trade
d) Financial plans – how best the organization must
utilize its money
e) Human Resource plans – helps the company
allocate its manpower in the most ideal
manner.
2) Tactical/Operational Plan
- done at the department, division level of the
organization
- mainly deals with performance operations of the
organization
- prepared for a short period – usually less than a year.
Main Types of Operational Plan
1) Single Use Plan – applicable to activities that do not
repeat
Examples:
a) Program – is a set of activities towards an objective.
Ex. Special program for gifted children
b) Budget - It provides funds indicating the sources of
their corresponding expenditures.
Ex. Budget for additional teachers
3) On-going plans - used for continuing situations,
problems, and activities which are similar and
consistent.
Ex.
a) Policy – guideline for making decisions
b) Procedure – step-by-step instructions for
performing an activity or a task.
c) Rule - is a specific plan for controlling
human behavior at work.
 STEPS IN PLANNING
1) Establish objectives
2) Evaluate the environment
3) Determine the best alternative strategy
4) Implement the action plan
5) Evaluation of results
 PLANNING TOOLS AND TECHNIQUES
1)Brainstorming
- A techniques of drawing out ideas from a
group of people.
- It creates new ideas, solves problems,
motivates and develops teams.
2)Fishbone Diagram
- also called “a cause and effect diagrams”
- also referred to as “ishikawa diagram”
named after Kaoru Ishikawa
- looks like a fishbone
3) Gantt Chart
- named after Henry Gantt who devised this
technique in 1910.
- extremely useful in project management
- excellent model for scheduling and
budgeting, and for reporting, presenting,
and communicating project plans.
 ASSIGNMENT NO. 4
(to be submitted until April 6, 2022, until 5 pm only)
Direction: Answer this in a paragraph form.
1) Through facebook/messenger, look for a relative, a
friend who is a manager or administrator and ask
him/her how he/she plans. Indicate his/her position
and the company where he/she is working. Ask
him/her also what difficulties he/she encountered in
the planning process. Document your interview.
2) Specify five (5) objectives you would like to attain
for yourself in this class by the end of the school
year. Are these attainable? Explain your answer.
Submit this assignment tomorrow, April 16, 2021
up to 5:00 pm.
ORGANIZING
 NATURE OF ORGANIZATION

Organization - is a group of people who work

together, coordinate and collaborate their actions to
achieve a broad scope of goals.
Organizing - is the process of arranging an
organization’s structure and coordinating its
managerial practices and the use of resources to
achieve its goals. (Stoner, 1989)
 Organizing - is the process of identifying and
grouping the work to be performed, defining and
delegating responsibility and authority, and
establishing relationships, for the purpose of
enabling people to work most effectively together in
accomplishing objectives. (Allen)
 ELEMENTS OF ORGANIZING
1) Identification and grouping of work to be done
- requires the establishment of job designs which
include the procedures and operations which should be
performed by the employee in each position.
- jobs are identified and grouped together into
meaningful categories.
- this grouping is known as “departmentation.”
a) Departmentation by function
- Employees involved in similar or closely related jobs
are grouped together.
 - Functional departmentation is best typified
in organization where departments are organized
separately for finance, marketing, production,
among others
b) Department by product
- All activities associated with an individual product
or closely related product groups are put together.
 DIFFERENCE BETWEEN ORGANIZATIONAL
STRUCTURE AND ORGANIZATIONAL CHART
Organizational Structure - is the arrangement of
the functions performed by the various personnel in the
different units, usually classified into divisions,
departments, sections, and the rank and file workers.
Organizational Chart - is a diagram showing the
salient aspects of an organizational structure.
- shows the relationship between positions as to
authority, responsibility, and accountability and the
people who occupy them.
 TYPES OF ORGANIZATION STRUCTURES

 There are two organizations that managers must

deal: formal and informal
 Formal organizations - an organization in which
job of each member is clearly defined, whose
authority, responsibility, and accountability are
fixed.
Ex. churches, schools, hospitals, and companies
Informal Organizations - are sets of evolving
relationships and patterns of human interactions
within an organization that is not officially prescribed.
Ex. fraternity or sorority
dorm residency
project work teams
seating arrangements
interest groups
friendship groups
 TYPES OF ORGANIZATIONAL STRUCTURE
1) Line Organizational Structure
- has only vertical relationships between diffferent
levels in the firm.
- Line departments are directly involved in
accomplishing the primary goal of the organization.
- tends to simplify and clarify authority,
responsibility, and accountability.
- promotes fast decision making and very simple to
understand.
 - As the organization grows larger, line organization
becomes more ineffective.
2) Line and Staff Organization
Staff Officers - are persons trained to provide
specialized services to the line officials.
Staff Department - is a department whose function
is to give counsel or servicing one of more departments.
Ex. legal, research and personnel departments
- Line and staff type of organization is a combination
of line type and staff type.
- It combines their advantages, and with good
coordination, it is proven to be highly effective.
 - Ability of the line officials to get work done is
multiplied when the staff officers constantly fed them
with specialized assistance.
3) Functional Authority Organizational Structure
- the line officers or managers have the direct
power to achieve the organizational goals.
- the staff officers or managers have staff authority
over the line.
- in line organization, theline managers cannot be
experts in all functions they are required to perform,
but in the functional authority organizations, staff
personnel who are specialists in some fields are given
functional authority.
4) Divisional Organizational Structure
- the organization can have a different basis on
which departments are formed.
- They are by function, product, geographic
territory, project and combination approach.
5) Functional Departmentation
- is the process of creating organizational units on
the basis of the firm’s major activities.
- it involves grouping employees according to the
broad tasks they perform.
b)Product Departmentalization
- organizes employees based on which product line
or set of services they work with.
- Each product line has a department of its own,
and each department has specialists in all of the
functions needed to produce and sell that product, such
as marketing, manufacturing, accounting, and human
resources.
c) Departmentation by Geographic Territory
- adopted when several activities are
geographically dispersed in different locations.
- all activities relating to a particular area or zone
may be grouped together under one zonal manager
or head.
d) Departmentation by Project
- projects and task forces or teams are generally
unique-designed to work on a non-recurring project.
- they are tightly organized units under the
direction of a manager with broad powers of authority.
- a team is given a project with specific tasks or
operational concerns.
e) Departmentation by Combination Approach
- An organization may have to combine two or more
of the methods of departmentation to make best use of
all of them.
f) Matrix Organizational Structure
- a permanent organization designed to achieve
specific results by using teams of specialists from
different functional areas in the organization.
- Matrix organization decentralized decision-
making, improved environmental monitoring,
responses to change and has flexibility in the use of
resources.
 MAJOR ELEMENTS OF DELEGATION
1) Responsibility
- means assigning work to an individual;
- the managers assign particular responsibility to
the subordinates for the completion of certain tasks on
his behalf;
- an individual has to apply his physical and
mental ability to get the job completed efficiently.
- manager assigns the responsibility and, in case
the subordinate fails, the manager will be answerable
to his seniors, thus, responsibility flows upwards.
2) Authority
- to fulfill the duty, certain authority is delegated to
the subordinate;
- Authority means the power to take decisions
independently and accomplish the task efficiently;
- The authority must be equal to the responsibility,
this means, a certain level of authority is delegated
which is sufficient to complete the responsibility;
- Authority flows upward, as we go up in the
scalar chain, the authority increases.
3) Accountability
- means to check whether the subordinates are
performing their responsibilities in an expected manner or
not.
- cannot be delegated, in the case of non-completion of
tasks, the manager will only be held responsible for it, not
the subordinates;
- Accountability also flows upward, e.g. subordinates will
be accountable to the manager, and the manager to his
superior.
 - To get the task accomplished, the manager
delegates some responsibility along with certain
authority to his subordinates to exercise control and is
held accountable for his operations only to the
immediate manager and not to the manager’s
manager.
 FORMAL AND INFORMAL ORGANIZATIONS
Formal Organization
- formed by top level management;
- members have to follow certain rules and
regulations which are documented, made by superiors.
If members follow these rules properly, they will be
rewarded, however, if they do not, they will be
penalized.
- duties and responsibilities,authority and
accountability of each member are well-defined;
 - the objective or goal are specific and well-defined.
The main objectives of a formal organization are
productivity, growth, and expansion.
- a formal organization is stable;
- a formal organization is shown on the
organization chart.
- members of the formal organization get financial
benefits like wages or salaries,bonuses, allowances,
health insurance, etc.
Informal Organization
- formed by social forces within the formal
organization;
- does not have to follow certain rules and
regulations, which are documented and are made by
a formal authority or the superiors;
- There are no fixed duties, responsibilities,
authority, accountability for the members.
 - The objectives are not specific and well-defined;
- The main objectives of an informal organization
are friendship, security, common interest, individual
and group satisfaction;
- An informal organization is not stable;
- It is not shown on the organization chart;
- Members get personal social benefits like
friends, community group etc.
STAFFING
 Staffing - is the selection and training of
individuals for specific job functions and charging
them with the associated responsibilities.
- it is a continuous activity because the
movement of employees due to promotion and
transfer takes place continuously.
Staffing - is putting the right people at the right
job, it is the Human Resouces Manager’s job to look
for people, select, train, develop, provide
remuneration, etc.
 BEST PRACTICE TO ATTRACT TALENTED AND
DIVERSE APPLICANT POOL

1) Identify vacancy and evaluate the need

Proper planning and evaluation of the need will
lead to hiring the rught person to the role and the
team
If it is a newly created position, check the core
skills needed for the position.
Conduct a job analysis if there is a need to fill in
the main tasks.
2) Develop job description
 This is the core of a successful recruitment process.
 A job description contains all the information,
competencies, skills, required and expected of the
position.
3) Develop recruitment plan
 A carefully structured receuitment plan maps out
the strategy for attracting and hiring the best-
qualified candidate and ensure an applicant pool
which include women, underrepresented groups
including veterans and persons with disabilities.
4) Select search committee
 To ensure applicants selected for interview and
final consideration are evaluated by more than one
individual to minimize the potential for personal
bias, a selection committee is formed.
 A manager should appoint a search committee that
represents a diverse cross section of the staff.
5) Post position and implement recruitment plan
 Once the position description has been completed,
the position can then be displayed.
 Every effort should be made to ensure the
accuracy of the job descriptions and posting text.
6) Review candidate and develop short list
 Once the job has been posted, candidates will
apply during the initial application.
 All applicants must be reviewed and considered.
 Candidates who apply after the initial application
period will be considered “expression of interest” and
not viewable by the search committee.
 All search committee members review all
applicants to ensure more than one person
assesses their qualifications and that individual
opinion or biases are avoided.
7) Conduct interview
 The interview is the single most important step in
the selection process.
 It is the opportunity for the employer and
prospective employee to learn more about each
other and validate information provided by both.
8) Select hire
 Once the interview have been completed, the
committee will meet to discuss the interviewees
 Committee members will need to assess the
extent of which each one met their selection
criteria.
9) Finalize recruitment
 Once a final check of the selection process has
been completed, and the final applicant has been
determined, the Committee Chair or designee
willnotify the Department HR of the finalist name,
salary and start date.
 It is important that each recruitment is properly
closed, including those interviewed and not selected.
DIRECTING
 Directing - involves guiding, inspiring and leading
people so that theya= accomplish predetermined objectives.
Leading Versus Managing
1. Leadership inspires change, management manages
transformation
- A leader must set direction and inspire people to follow
them while the managers’ job is to oversee the work needed
to implement the necessary changes abnd realize the
organizational transformation set forth by the leadership.
2) Leadership requires vision; management requires
tenacity
- A leader needs to envision what the business is to
become while the manager must have the willingness to do
whatever it takes to achieve the goals set forth by the leader.
3) Leadership requires imagination; management requires
specifics
- A great leader can cultivate their imagination to inform
their vision while managers must understand that vision and
drive their teams to do the specific work necessary to
accomplish what has been expressed.
4) Leadership requires abstract thinking; management
requires concrete data
- A leader requires abstract thinking which enables a
person to make connections among and see patterns
within and to reimagine what an organization can become,
conversely, a manager must be able to work with, and
analyze concrete data to ensure optimal results.
5) Leadership requires ability to articulate; management
requires ability to interpret
- A good leader can describe their vision in vivid detail
so to engage and inspire their organization to pursue it.
 - A good manager must explain that stated vision and
recast it in terms that their teams can understand and
embrace it.
6) Leadership requires an aptitude to sell,
management requires an aptitude to teach
- A leader must sell their vision to their organization
and its stakeholders while managers must be able to
teach their teams what must be learned and adapted to
attain the stated vision.
7) Leadership requires an understanding of the
external management requires an understanding of
how work gets done inside the organization.
- A leader must understand the business environment
in which the enterprise operates while a manager is relied
on to figure out how to get things done using the
resources available to the business.
8) Leadership requires risk-taking, management
requires self-discipline
- A leader will take educated rsks when setting a
strategic direction for the business, managers must have
the self-discipline to stick to the plan for realizing that
strategic direction.
9) Leadership requires confidence in the face of
uncertainty, management requires a blind
commitment to completing the task at hand.
- A leader’s life is filled with uncerainty and once
the course is set, managers are duty-bound to follow
the stated direction and commit to delivering the results
expected.
10) Leadership is accountable to the entire
organization;management is accountable to the
team.
- Leaders must consider the impact of their
decisions on the whole organizatio.n
 LEADERSHIP THEORIES
1) Trait Theories
- Trait theories argue that effective leaders share
common personality characteristics or features.
- Trait theories help us identify traits and qualities
(integrity, empathy, etc) that are helpful when leading
others.
2) Behavioral Theories
- it focuses on how leaders behave
 TYPES OF LEADERS
1) Autocratic Leaders
- make decisions without consulting their teams.
2) Democratic leaders
- allow the team to provide input before making
a decision.
3) Laissez-faire leaders
- they don’t interfere; they allow people within
the team to make many of the decisions
3) Contingency Theory
- The realization that there is no one correct
type of leader led to theories that the best leadership
style depends on the situation.
- These theories try to predict which style is
best in which circumstance.
4) Power and Influence Theories
- Authority and influence theories are based on
the different ways that oleaders use power and
influence to get things done.
CONTROLLING
 Controlling - is the measurement of
accomplishment against the standards and he
correction of deviations to assure attainment of
objectives according to plans. (Knootz and O’Donnell)

Controlling - is determining what is being

accomplished, e.g. evaluating the performance and if
necessary, applying corrective measures so that the
performance takes place according to plans. (GR.
Terry)
 CONTROL METHODS AND SYSTEMS
1) The Budgetary Control
- Budgets are the most widely used control system
because the plan and controlresources and revenues are
essential to the firm’s health and survival.
Budgeting - is the formulation of plans for a given
period in numerical terms.

Audits
- Internal auditing provides an independent review and
appraisal of accounting, financial and other non-tactical
operations.
Performance Standards
- Top managers control their organization by establishing
certain performance standards.
- These performance standards are often just more clearly
defined objectives.