ORGANIZATION

Presented by:
JUDY ANN V. SARAIL, M.A.M.
Palawan State University-
College of Hospitality Management and Tourism
 ORGANIZATION
Executive structure of a business
- the framework or backbone by which the work of a
business, managerial or otherwise, is performed, that it provides
the required channels, points of origin and flow of management
direction and control.
 also connotes a creative process (result of managerial
efforts to carry out a predetermined course of action).

- 1ST definition: total business organization (facilities,

materials, money, and manpower)
- final definition: concept ( member is assigned in specific
duties ---work effectively together)
 ORGANIZATION
 is a collection of people working together to achieve a
common purpose.

All organizations share a broad purpose –providing goods or

services of value to customers and clients.

A clear sense of purpose tied to “ quality products” and

“customer satisfaction” is an important source of organizational
strength and performance advantage.

It creates a platform for growth and long term success.

 ORGANIZATION
TYPES of ORGANIZATION STRUCTURES

1. LINE ORGANIZATION- the simplest form of structure and

refers to a direct straight-line responsibility and control from the
top management to the middle management and to the lower
level.
 the oldest form of organization structure
Common in many small and medium-sized companies
Authority and responsibility are clear in this type
2. LINE and STAFF ORGANIZATION - utilizes the
assistance of experts or specialists.
 as the companies expand from simple to complex organizations-
 ORGANIZATION
TYPES of ORGANIZATION STRUCTURES

that a small number of managers could not personally assume direct

responsibility for all functions ( research, planning, distribution, public
relations, industrial relations and many other activities of business).
 one option – as a company expands in size and complexity is to
appoint assistants to managers.
 as the activities of these assistants increase, other personnel are
added to list.
3. FUNCTIONAL ORGANIZATION – this removed the staff specialist
from his “assisting” capacity and gave him the pure authority and
responsibility for supervision and administration of the function replacing the
operating foreman.
 ORGANIZATION
TYPES of ORGANIZATION STRUCTURES

 this type of organization violates one of the traditional

principles of organization, namely, the “Unity of Command.”
 according to this principle, no one subordinate can have more
than one supervisor.
 Reporting to several bosses may create organizational
problems such as lack of clarity of authority, inadequate
control, confusion, and conflicts.
 ORGANIZATION
TYPES of ORGANIZATION STRUCTURES
4. COMMITTEES – another common organizational form used in
situations where group participation and decision are required.
o these are created to undertake special activities rather than
routinary activities.
o Committees may be classified as:
a. Ad Hoc Committee – this undertakes temporary activities; or
b. Standing Committee – this is sometimes called permanent
committee which undertakes permanent activities, such as budget
committee.

a COMMITTEE is a tool for the development of ideas and procedures.

 ORGANIZATION
AS SYSTEMS

OPEN SYSTEM – transforms resource inputs from the environment into

product.

ORGANIZATIONAL PERFORMANCE

•PRODUCTIVITY – is the quantity and quality of work performance, with

resource utilization considered.

• Performance effectiveness – is an output measure of task or goal

accomplishment.
•Performance efficiency – is a measure of the resource costs associated
with goal accomplishment.
 ORGANIZATION
KINDS OF BUSINESS
1.Industry - involve in the conversion of raw materials into finished
products or goods and the application of labor upon
raw materials so that greater usefulness becomes

possible after the process in the industrial group.

> farming
> fishing
> mining
* manufacturing – Nokia, Honda, Sony, San
Miguel Brewery, Shell,
Purefoods, etc.
 ORGANIZATION
KINDS OF BUSINESS

2. COMMERCE – involves the process of buying and selling where the

goods
are moved from one point of production to the point of
consumption.
Ex. Shoe Mart, Rustan’s, Robinson’s COD, National
Bookstore, Webster, etc.

3. SERVICE ENTERPRISE – are primarily concerned with the satisfaction

of the needs and wants of the consumers.
a. public and community service; and
b. professional or trade service,
Ex. Transportation companies, MERALCO (PALECO), motion picture
producers, and newspaper publishers.
 ORGANIZATION
KINDS OF BUSINESS

Professional and trade services are businesses which capitalize on

personal
skill and talent for rendering service.
* payment – retainer’s fee ex. Law offices, C.P.A., Management
consultants, commission agents, repair shops, building contractors and
others.

Services maybe divided into two:

 Recreation services which include TV Stations, movie productions, and
the theaters; and
 Personal services which include hotels, restaurants, schools, beauty
parlors, etc.
 ORGANIZATION
LEGAL FORMS OF BUSINESS OWNERSHIP

1.SOLE Proprietorship – a form of business ownership organized and

managed by only one person.

2.PARTNERSHIP – a business organization where two or more persons

contribute money, property, or talent to
carry on the
business.
3. CORPORATION - is an artificial being created by the operation of law,
having the rights of succession and the powers, attributes, and properties
expressly authorized by law or incident to its existence.
 ORGANIZATION

ADVANTAGE DISADVANTAGE

1.Single 1. Easy to set up/ 1. Demanding on

Proprietorship start owner’s
(one proprietor) personal time
2. Decision-making is 2. Growth
limited by
left entirely to owner owner’s
financial
means
 ORGANIZATION
ADVANTAGE DISADVANTAGE

2. PARTNERSHIP 1. Relatively easy 1. Dissolution of

(two or more to set
partnership by
up partners) any personal rifts
between
partners
2. Checks and balances 2. Equal
profit
maintained with two sharing
despite
parties around unequal
attention and time
give by
partners
to
business
 ORGANIZATION

ADVANTAGE DISADVANTAGE

3. CORPORATION 1. Maximum flexibility 1. complicated set-

(at least five 2. Limited liability of tings up process
stockholders) individual share 2. Limited influence
on
management by
individual stock-
3. Greater room for holders
professionalism 3. Tendency
to insti-
tutionalize
bureau-
cracy
 ORGANIZATION

ADVANTAGE DISADVANTAGE

3. CORPORATION 4. Dissolution is least -

(at least five likely to occur
stockholders) 5. Can involve a wide range
of people in business
including employees
6. Reduced tax burden on
owners