NATURE AND

ROLE OF THE
FIRM
 HUMAN RESOURCE
MANAGEMENT
• is the entire spectrum of management of people that serves to maximize their
performance in order to meet the organization’s strategic objectives.
• it covers, among others, the major functions of recruitment, selection and
placement, training and development, employee relations, and compensation and
benefits administration.
 MARKETING
MANAGEMENT
• According to Business Case Studies, “Marketing is the management process
responsible for identifying, anticipating, and satisfying consumer requirement
profitably.”
 OPERATIONS
MANAGEMENT
• “Operations management involves overseeing, designing, controlling the process of production,
and redesigning business operations in the production of good and services.” (Source: eNotes)
• In a manufacturing setting, the company has to ensure the design of effective and efficient
production process, timely acquisition of raw materials needed for production, deployment or
adequate number of trained workers, and the proper maintenance of equipment and other
resources required.
• In a service-oriented setting, on the other hand, the company has to ensure the availability of
trained and customer-oriented personnel, presence of customer service locations, and excellent
provisions of customer services.
 FINANCIAL
MANAGEMENT
• “The goal of any finance function is to achieve three benefits: business report
service, lowest costs, and effective control of the environment.”
• Toward the end, the firm has to ensure that it sets up effective and efficient
internal process designed to achieve all these, while maintaining the values
of being vision-oriented, growth-focused, intuitive, and risk-taking (Source:
Role of Finance in a Business, by Dana Griffin, Demand Media)
 MATERIAL AND
PROCUREMENT
MANAGEMENT
• It is the responsibility of the firm to ensure that it manages the procurement
process and the supply base effectively and effeciently.
• This includes buying high quality products and services at the right price from
the right, reliable source, based on the right specifications, in the right quality
for delivery, at the right time to the right customers.
 OFFICE MANAGEMENT
• According to BusinessDictionary.com “Office management involves the design,
implementation, evaluation, and maintenance of the process of work with an
organization, in order to maintain and improve efficiency and productivity.”
• It is the responsibility of the firm to monitor and review systems that would
yield expected outcomes like improved turnover, output, sales, etc.
• It is like the backroom support that will ensure the effective discharge of
functios of revenue-generating units of the organization.
 INFORMATION AND
COMMUNICATION TECHNOLOGY
MANAGEMENT
• This includes a related form of communication or application that encompasses
radio, television, cellular phones, computer and network hardware and software,
statellite system, and so on, as well as the various services and applications
associated with them such as videoconferencing and distancing learning (Source:
Margaret Rouse, Whatts.com)
• It is the responsibility of the firm to provide the necessary information and
communication facilities to all its busines units in order to ensure that they are
able to perform their functions more effectively and effeciently
 TYPES OF
ORGANIZATION
STRUCTURE
• The structure of an organization is a crucial part in the progress of an
organization since it can help or hinder the organization in the movement
toward of accomplishing these goals.
• They can be “tall”, those that have many tiers between the common worker
and the owner of the company,or they can be “flat”, meaning there are very
few levels between the common worker and the owner.
• A basic organization framework is called a line structure.
 LINE STRUCTURE
• Has only direct, vertical relationshops between different levels in the firm.
• There are line departments inside a line structure.
• Line departments are directly involved in accomplishing the primary goals of
the organization.
 CEO

MANAGER MANAGER
(Production) (Marketing)

Foreman Foreman
Sales Sales
(Fabricati (Assembl
Officer (A) Officer (B)
on) y)

Salespers Salespers
Workers Workers
ons ons
ADVANTAGES:
1. Tends to simplify and clarify authority
2. Promotes responsibility and accountability relationships
3. Promotes fast decision-making
4. Precise and simple to understand
DISADVANTAGES:
5. Neglects specialists in planning
6. Overloads tasks on key personnel
7. It becomes more ineffective as the organization becomes bigger
8. Managers become experts in too many fields in area
9. Tendency to become overly dependent on the few key people who are performing
numerous jobs
• A line function, as discussed, is a position that has a direct chain of
command that is responsible for the achievement of an organization’s goals.
• A staff function, on the other hand, is intended to provide expertise, advice,
and support for the line positions.
• There are, however, several variations of organizational structures. The three
common types are: functional, divisional, and matrix structure.
 FUNCTIONAL
• It is a set up wherein each department of the organization is group according to its
function or purpose.
• Works very well for small businesses in which each department can support itself
by relying on the talent and knowledge of its workers.
• However, one of the drawbacks in a functional structure is the restriction in
coordination and communication between and among other departments by the
boundaries of th organization in which having the various deparments working
separately and independently.
 President/
CEO

Marketing Sales Production

Department Department Department
 DIVISIONAL
• Is typically used in larger companies or organizationss with several branches or
outlets that operate in a wide geographic area or that have separate smaller
organizations within the umbrella group to cover different types of products or
market areas.
• Provides significant benefits which addresses needs more rapidly and more
specifically; however, communication is inhibited because employees in different
division are not wworking.
• This could also be costly because of its size and scope.
 XYZ
Compa
ny
Mindan
Luzon Visayas
ao
Division Division
Division
 MATRIX STRUCTURE
• Is a hybrid of two structures namely, divisional and functional structure.
• Typically used in large multinational companies, the matrix structure allows for the benefits of
functional and divisional structures exist in one organization.
• This can create power struggles because most areas of the company will have a dual
management
• It does not follow the traditional heirarchical model.
• One advantage point of the matrix structure is the flexibility and the balanced decision-making.
• Its disadvantage would be complexity which can lead to confusion among employees.
 CEO

Marketing Sales Services

Electronic
s Division

Electronic
s Division

Electronic
s Division
 INFORMAL
ORGANIZATIONAL
STRUCTURE
• One must bear in mind that there are two broader organizational structure identified
as formal and informal organization.
• The formal organization, as discussed and illustrated, are usually represented with
organizational charts and with positions descriptions.
• There is a clear reporting relationship that the manager is aware of.
• The informal organization is a set of evolving relationships and patterns of human
interaction within an organization that usually do exist but are not officially prescribed.
THANK
YOU 