CHAPTER 2 MANAGEMENT THEORY and practices

Qualities of Manager

1. CHAPTER 2 - QUALITIES OF A MANAGER
MANAGEMENT THEORIES
LEVELS OF MANAGEMENT
ORGANIZATIONAL STRUCTURE
MEMORANDUM OF ASSOCIATION (MOA)
AND ARTICLES OF ASSOCIATION (AOA)
LINE STAFF ORGANIZATION
MANAGEMENT THEORIES AND PRACTICES
NUEZ, CANDY CARYL D.

2. A Manager
is the person responsible for planning and directing the work of
a group of individuals,
monitoring their work, and taking corrective action when
necessary.
This is their first step into a management career.
May direct workers directly or they may direct several
supervisors who direct the workers.
must be familiar with the work of all the groups
may have the power to hire or fire employees or to promote
has the authority to change the work assignments of team

3. 1
Basic roles and skills of manager
A manager wears many hats.
a team leader, but he or she is also a
planner, organizer, cheerleader, coach, problem solver,
and decision maker — all rolled into one. schedules are
usually jam‐packed.
Whether they're busy with employee meetings, unexpected
problems, or strategy sessions, managers often find little spare
time on their calendars.
(And that doesn't even include responding to e‐mail)

4. Managerial Skills
Technical Skills:
Ability to use special proficiency or expertise to
perform particular tasks.
Examples: Accountants, engineers, market
researchers, computer scientists.
Acquired through formal education, training, and
job experience.
Most important at lower levels of management.

5. Managerial Skills
Human Skills:
Ability to work well in cooperation with others.
Evident as trust, enthusiasm, and genuine involvement in
interpersonal relationships.
High degree of self-awareness and empathy.
Can be naturally possessed or improved through classes
or experience.
Critical for all managers due to the interpersonal nature of
managerial work.

6. Managerial Skills
Conceptual Skills:
Ability to think analytically and break down problems into
smaller parts.
a.
Understand relations among parts and recognize implications
for other problems.
b.
Important for dealing with ambiguous problems with long-
term consequences.
c.
Acquired through formal education, training, and job
experience.
d.
Increasingly important at higher management levels.e.

7. “MANAGEMENT THEORIES”
1. Frederick W. Taylor's (1856-1915) Scientific Management
work was amongst the first to study worker productivity and
how best to increase it
2. Henri Fayol's (1841-1925) Principles of Administrative
Management are considered to be some of the most
influential contributors to modern management theory.
3. Max Weber's (1864-1920) Bureaucratic Management
focused on structuring organisations in a hierarchical fashion
with clear rules of governance.

8. “MANAGEMENT THEORIES”
4. Elton Mayo's (1880-1949) Human Relations movement
conducted experiments aimed at improving productivity
amongst dissatisfied employees
5. Douglas McGregor’s (1906-1964) Theories X and Y work
concluded that there are two fundamentally different styles
of management that are guided by managers' perceptions of
their team members' motivations.

9. BASIC THEORIES OF RESTAURANT MANAGEMENT
1. Autocratic Theory
2. Democratic Theory
3. Consultative Theory
4. Laissez-Faire Theory
Motivation
Maslow’s Need Hierarchy Theory of Motivation
KAIZEN

10. “LEVELS OF MANAGEMENT”
Management involves performing specific functions by
individuals within an organization.
Individuals are organized in a hierarchy.
Each person is responsible for completing certain tasks.
Individuals are given authority to make decisions related to
their tasks.
This structure creates relationships of superiors and
subordinates.
It leads to different levels within the organization.

11. “LEVELS OF MANAGEMENT”
Top Management:
Consists of senior-most executives (chairman, CEO, COO,
president, VP).
Includes managers from different functional areas
(finance, marketing).
Integrates diverse elements and coordinates
departmental activities.
Responsible for the organization's welfare and survival.
Analyzes the business environment for the firm's survival.
Formulates organizational goals and strategies.
Oversees all business activities and societal impact.
Job is complex, stressful, and demands long hours and
commitment.

12. “LEVELS OF MANAGEMENT”
Middle Management:
Acts as the link between top and lower level
managers.
Subordinate to top managers and superior to first
line managers.
Includes roles such as division heads (e.g.,
production manager).
Implements and controls plans and strategies
developed by top management.
Responsible for the activities of first line managers.

13. “LEVELS OF MANAGEMENT”
Middle Management:
Main tasks:
Interpret policies framed by top management.
Ensure their department has the necessary
personnel.
Assign duties and responsibilities to personnel.
Motivate personnel to achieve objectives.
Cooperate with other departments for smooth
functioning.
Ensures the execution of plans formulated by top
managers.

14. “LEVELS OF MANAGEMENT”
Supervisory or Operational Management:
Includes foremen and supervisors at the lower level of the
hierarchy.
Directly oversee the efforts of the workforce.
Authority and responsibility are limited by plans from top
management.
Interact directly with the workforce and pass on instructions from
middle management.
Ensure quality of output, minimize material wastage, and maintain
safety standards.
Quality and quantity of output depend on workers' hard work,
discipline, and loyalty.

15. “WHAT IS AN ORGANIZATIONAL STRUCTURE?”
Also known as "organogram structure" or "org
structure."
Outlines the hierarchy within an organization.
Describes roles, responsibilities, and lines of
command.
Aims to achieve the organization's business goals.
Establishes transparent relationships between
departments.
Provides clarity, focus, and efficiency for employees.
Helps employees understand who they report to and
their goals.
Often visually represented by "org charts" to explain
reporting and accountability.

16. “WHAT IS AN ORGANIZATIONAL STRUCTURE?”
Functional Organization:
Differentiates employees by skill and specialty.
Depends on a ranking system with several
departments.
Departments are guided by expert leadership.
Commonly used by businesses.
Combines workers with similar knowledge and skills.
Effective in a team environment.
Helps the company achieve its desired goals.

17. “WHAT IS AN ORGANIZATIONAL STRUCTURE?”

18. ORGANIZATIONAL STRUCTURE?”
Advantages of Functional Organization
Leaders have expertise in their specific areas,
improving team performance.
Employees are skilled in their fields, leading to more
efficient and accurate work.
Team members share similar backgrounds,
promoting better collaboration and solutions.
Clear reporting structure means employees deal
with fewer managers.
Employees feel secure and valued, which can boost
their performance.

19. ORGANIZATIONAL STRUCTURE?”
Disadvantages of Functional Organization:
Work can become repetitive and dull, leading to
employee boredom.
Managing appraisals and promotions can be
challenging, possibly causing conflicts.
High specialization can be hard to achieve and
maintain.
Changes in personnel can disrupt the system and make
it inflexible.
Employees may lack broader skills and knowledge
outside their department, which can hinder inter-
departmental communication.

20. ORGANIZATIONAL STRUCTURE?”
# Product Organization Structure
In the projectized (or project-based) project management
organizational structure, the largest divisions of people within the
company are projects (not departments).
And similarly, the
coordination of work is project-oriented, thus vertical.
Also, the authority to supervise work belongs to project managers
—one per project. And they
allocate staff members to projects, which means that those
members are dedicated to projects
(instead of departments).

21. ORGANIZATIONAL STRUCTURE?

22. How does an organizational structure by product work?
Having various products and each producing on a large scale often
requires a specific approach to success. Each has different threats and
market opportunities, thus requiring different competitive strategies.
Conversely, management may find it difficult to determine priorities if
managed under a single organization.
And structuring the organization by product is an option. So how does the
company do it? Let’s take a car company as an example.
Say the company has three product lines:
1. Passenger car
2. Commercial car
3. Electric car

23. How does an organizational structure by product work?
Divisional Organization:
Divides the company into three separate divisions, each handling one
product line.
Each division operates independently with its own business functions.
Example: Passenger Cars Division:
Includes operations, marketing, human resources, and finance.
Responsible for all activities needed for success:
Buying raw materials.
Manufacturing.
Hiring employees.
Selling products.
Making a profit.
The same structure applies to the other two product lines.

24. Advantages of Product-Based Structure:
Companies can profit from different product lines,
balancing losses in one area with gains in another.
Each division focuses on a specific product, leading to
better management and employee expertise.
Divisions share best practices, enhancing overall
company success.
Divisions operate independently, adapting quickly to
market changes and speeding up product development.
Divisions compete to achieve higher profits, which
benefits the company as a whole.

25. Disadvantages of Product-Based Structure:
Each division needs its own teams for marketing,
procurement, production, and finance, leading to
inefficiency and higher costs.
Separate functions in each division can lead to
increased expenses and missed opportunities for bulk
discounts.
Success in one product line might hurt others, as
divisions may compete for the same market.
Divisions have significant autonomy, which can lead to
a lack of alignment with the company’s overall goals

26. Memorandum of Association (MOA)
and Articles of Association (AOA)
MOA and AOA are the foundational documents on which
a company stands. MOA contains all the data required
for company incorporation. On the other hand, AOA
contains the rules and the regulations a company needs
to follow.

27. Memorandum of Association (MOA):
Contains all details of the company's incorporation.
Main document projecting the company's structure.
Also known as the charter of a company.
Lays down the scope of the company's activities.
Defines the objectives for starting the company.
Determines the scope of the company's authority and
its relationship with the outside world.
First document to be submitted for company
registration.

28. Articles of Association (AOA):
Second most important document for company
registration.
Establishes rules, regulations, and guidelines for
controlling or administering the business.
Subordinate to the Memorandum of Association
(MOA).
Essential for defining the organization's internal
functions and responsibilities.
Contents must align with the MOA and the Companies
Act, 2013.
Required for business registration.

29. Contents of AOA
❖ Adoption of preliminary contracts.
❖ Share capital, variation of rights, number and value of
shares it holds.
❖ Issue of preference shares.
❖ Allotment of shares.
❖ Calls on shares.
❖ Lien on shares.
❖ Transfer and transmission of shares.
❖ Forfeiture of shares.
❖ Alteration of capital.
❖ Buyback.
❖ Share certificates.
❖ Conversion of shares into stock.
❖ Voting rights and proxies

30. Contents of AOA
❖ Adoption of preliminary contracts.
❖ Share capital, variation of rights, number and value of
shares it holds.
❖ Issue of preference shares.
❖ Allotment of shares.
❖ Calls on shares.
❖ Lien on shares.
❖ Transfer and transmission of shares.
❖ Forfeiture of shares.
❖ Alteration of capital.
❖ Buyback.
❖ Share certificates.
❖ Conversion of shares into stock.
❖ Voting rights and proxies

31. Task: Create MOA and Articles of Association
1. Memorandum of Association (MOA)
Objective: Define the purpose and scope of the company.
1. Company Name: Choose a unique name for the company.
2. Registered Office Address: Provide the official address of the company.
3. Objectives: List the primary activities and goals of the company
4. Liability: State whether the liability of members is limited or unlimited
5. Capital Clause: Detail the total capital and division of shares.
6. Association Clause: Include the names of the initial shareholders and the
number of shares they hold

32. TASK 2 - Articles of Association
Objective: Outline the internal rules and regulations governing the company.
Steps:
Define the types of shares and the rights attached to each.a.
Board of Directors: Outline the process for appointing directors, their
powers, and duties.
b.
Meetings: Set rules for shareholder and board meetings, including notice
periods and voting procedures.
c.
Dividends : Explain the distribution of profits and dividends to
shareholders.
d.
Transfer of Shares: Detail the procedure for transferring shares.e.
Borrowing Powers: Specify the powers of the company to borrow money.f.
Amendments: Describe how the MOA and Articles of Association can be
amended.
g.
1. Present the documents one week after the discussion.
2. Group representatives will be selected to explain the contents of the
documents.
3. Handwritten.

33. Line-Staff Organization:
Distributes work responsibilities from upper management to
lower-level employees.
Managers set work quality standards and deadlines.
Communicate expectations to the team.
Team members are responsible for meeting expectations
within the assigned time.
More flexible than a line structure.
Involves qualified supervisors managing associates while
maintaining leadership authority.
Includes industry experts to support line managers' work.
Commonly used by medium-sized and large corporations to
stabilize the chain of command.

34. There are two major types of features in a line-staff organization.
Line Positions:
Employees who directly contribute to the company's mission.
Handle responsibilities crucial for the smooth operation of the
business.
Can include both managers and entry-level employees.
Line Managers:
Design objectives to improve work quality.
Create milestones for the department or organization.
Line Personnel:
Complete tasks designated by line managers.
Tasks may include building products for consumers or fulfilling
client requests.

35. There are two major types of features in a line-staff organization.
For example, a department store could use the line-staff organization.
The line
managers might include the store manager, who monitors sales goals and
creates shifts for all employees, as well as the department supervisors,
who manage the shoe, jewelry and apparel sections. The line personnel
could include part-time associates who replenish merchandise to the
correct departments and process customer payments. Every line
employee completes work
that fuels the department store's main goal, which is to sell various
products to customers.

36. There are two major types of features in a line-staff organization.
Staff Positions:
Assist line professionals in achieving organizational goals.
Include both managerial and lower-level employees.
Staff Managers:
Industry experts providing recommendations to line managers.
Hold higher rank over all personnel, including lower-level line and
staff members.
Staff Employees:
Support line counterparts in handling occupational
responsibilities.

37. There are two major types of features in a line-staff organization.
For instance, in a department store, the staff manager might be
a quality assurance
coordinator who evaluates the visual displays of the
merchandise and suggests ways to position the products to
better appeal to customers. The staff personnel could include
an employee who keeps the sales floor neat and organized and
tracks the number of purchases made in one day. Neither
professional is directly participating in the sale of products,
but their efforts enhance the line employees who do.

38. There are two major types of features in a line-staff organization.

39. Pros of a Line-Staff Organization:
Provides Expertise to Occupational Tasks:
Presence of industry experts within the company.1.
Line employees receive qualified advisement from
knowledgeable professionals.
2.
Enhances business operations through specialized knowledge.3.
Example: A human resources manager with expertise in
employment law, budgeting, and policies.
4.
Advises line managers on best practices for communication,
addressing needs, and recruiting.
5.
Enables line supervisors to adopt improved management
styles.
6.

40. Pros of a Line-Staff Organization:
3. Allows Greater Focus on Core Responsibilities:
Flexibility reduces the workload of line employees.1.
Staff employees handle industry-specific tasks and
gather information.
2.
Line employees can concentrate on core
responsibilities and achieving the company's
purpose.
3.

41. Cons of a Line-Staff Organization:
Causes Authority to Overlap:1.
Potential confusion between the authority of staff supervisors
and line supervisors.
Overlapping leadership can lead to unclear task assignments
and work expectations.
Remedies:
Inform lower-level employees about their direct managers.
Advise staff managers to provide recommendations only to
line counterparts.
Allow line managers to direct entry-level staff without
interference.

42. Cons of a Line-Staff Organization:
Misuses the Expertise of Staff Members:1.
Risk of hiring industry experts for tasks better suited for
line employees.
Expertise may be underutilized or not effectively applied.
Can defeat the purpose of having a line-staff structure.
Remedy:
Discuss position details during recruitment.
Ensure staff professionals are hired to provide field
advice and support, not just complete line tasks.

43. Cons of a Line-Staff Organization:
Costs Money to Fund Two Types of Employees:1.
Higher overall costs due to paying salaries for both line
and staff professionals.
Managerial positions often require higher wages to attract
qualified candidates.
Staff employees may also demand higher salaries due to
their industry expertise.

44. The more employees companies hire, the more funds they may
need to allocate toward salaries and benefits packages. If
reserving funds is a priority for your organization, it may be
beneficial to hire one staff member at a time to experience the
benefits of a line-staff structure without committing a bulk of
your financial resources.