MGT21 (PRINCIPLE OF MANAGEMENT)

A Final Requirements
Presented to
Ms. Sittie Alyssa P. Baraocor
Department of Accountancy
RC-Al Khwarizmi International College Foundation Inc.
Marawi City

In Partial fulfillment
of the Requirements for the Course
MGT21 (Principle of Management)
2nd Trimester, 2021

By

MACA-UMBOS, AIZA S.

JULY 2021
1. Define and give the purposes and kinds of organization

A. Horizontal/Flat Organization

 Horizontal or flat organizational structure is suitable for organizations that have the
least number of levels of hierarchy. They usually have no middle management, and
the executives are directly in touch with the staff. It is mostly used by start-ups and
small businesses and probably cannot be used any more once the company starts to
grow.

Pros

 Since the executives and employees are closer, the horizontal structure provides a
faster decision-making process and ensures the engagement of every employee.

 Gives employees more responsibility.

Cons

 The employees will not have certain positions in which they could specialize.

 Employees will not have specific supervisors to report to.

 It is hard for larger companies to adapt such a structure.

B. Functional Organization

 Functional organizational structure resembles the traditional hierarchical structure.

However in a functional structure, the organization is divided into smaller
departments that work for particular fields of operation. So each one of them has
managers who are responsible for reporting about their department to the executives
who are in a higher position.

Pros

 This kind of structure allows employee groups to put all their effort into the area
they work for and professionalize in that area.

 Employees have fixed responsibilities and tasks.

Cons

 It can cause a lack of communication between the departments.

 The self-centered mentality of a department may cause the failure of the others.

 The bureaucratic structure may cause slow decision-making.

 C. Divisional Organization

 Divisional organizational structure is mostly used by larger companies. In this

structure, each organizational function forms a division and they work autonomously
with their own resources. Divisions could be formed as market-based, product-
based, or geography-based according to the needs of the company.

Pros

 The autonomy of the divisions provides a more flexible working area.

 Ensures less risk for the company in case of a failure of one division.

Cons

 It can cause a communication gap within the company.

 It causes greater tax obligations since every division is operated as a separate

company.

D. Matrix Organization

 While matrix organizational charts show the hierarchy between the positions, it also
shows the cross-functional temporary or permanent teams set up for different
projects managed by multiple supervisors. The team members end up having more
than one manager which forms multiple chains of command. This situation is
depicted by a grid or matrix-shaped structure.

Pros

 Matrix structure allows the employees to be grouped according to their specialties

and to be picked up easily in accordance with the requirements of the projects.

 As employees participate in different groups, they could have the chance to improve
their abilities in different areas of work.

Cons

 As some projects could be temporary, matrix charts need to be updated constantly.

 Having more than one manager could cause confusion.

E. Team-Based Organization

 Team-based structure is a relatively new structure that opposes the traditional

hierarchical structure and it slowly rises all around the world. In such a structure,
employees come together and form groups in order to fulfill their tasks that serve a
common goal.
 Pros

 The elimination of some statuses assures faster processes of problem-solving and

decision making.

 Working in teams provides higher productivity and performance.

Cons

 Such a lateral structure does not let employees set a specific career path going
through the top which could be discouraging.

 The leadership must be very effective since there are fewer managers.

F. Network-Based Organization

 Network-based organizational structure is a contemporary way of configuration. It

allows a central organization to work with various types of external organizations for
its needs. The communication between the organizations relies on mutual reliance
and interest rather than hierarchy.

Pros

 This structure gives employees pretty much equal responsibility and power which
could embolden them.

 It also provides a flexible and independent working area.

Cons

 The complicated structure might cause confusion and errors.

 A higher number of supervisors.

 The network-based structure relies on digital communication which can cause delays
and problems.

G. Hierarchical Organization

 Hierarchical organizational structure is the most preferred one among other models.
It shows the chain of command from the top to the bottom, in which the top
represents the member with the supreme authority while the bottom represents the
low-level employees. In this type of structure, every employee has a supervisor.

Pros

 It shows who is authorized for particular decisions and tasks very precisely.

 It shows the career path gradually going through the top, which motivates the
employees to climb the corporate ladder.
  Instructions go from top to bottom directly, provides a clear communication.

Cons

 In such a structure, increased bureaucracy may slow the decision making down.

 It can make the low-level employees feel less responsible for the well being of the
company since they all have supervisors above them.

2. What you have contributed to the organization that you are involved in?

 As an officer in a specific organization, I have always carried out my responsibilities,

aided my co-officers in times of need, always extended my helping hands to them, and
ensured that my studies were not neglected as a result of joining the aforementioned
organization.

3. Distinguish Power and Authority.

 Authority most often comes from the duties and responsibilities delegated to a position
holder in a bureaucratic structure. A company president can order a product design
change, for instance, or a police officer has the authority to arrest an offender of the law.
While Power is the possession of authority, control, or influence by which a person
influences the actions of others, either by direct authority or by some other, more
intangible means. A prime source of power is the possession of knowledge. A person
with knowledge is oftentimes able to use that knowledge to directly or indirectly
influence the actions of others. The authority of knowledge is often independent of levels
or positions. Power can reinforce authority, and authority is one of the primary sources of
power.

4. Define Organizational Chart, give a sample of it and explain the reason why that
chart is significant on yourself.

 The definition of an organization chart or "org chart" is a diagram that displays a

reporting or relationship hierarchy. The most frequent application of an org chart is
to show the structure of a business, government, or other organization. Org charts
have a variety of uses, and can be structured in many different ways. They might be
used as a management tool, for planning purposes, or as a personnel directory, for
example. Perhaps your organization doesn't operate in a "command and control"
style, but instead relies on teams. This creates a clear visual depiction of the
hierarchy and ranks of different people, jobs, and departments that make up the
organization.

The organizational chart is significant

because it serves as a guide and ensures that
my responsibilities, duties and task are
carried out.
5. Discuss the principles of Management (Planning, Organizing, Staffing, Directiing,
Controlling) and explain their application in your life

Planning

 It is the basic function of management. It deals with chalking out a future course of
action & deciding in advance the most appropriate course of actions for achievement of
pre-determined goals.

 According to KOONTZ, “Planning is deciding in advance - what to do, when to do &

how to do. It bridges the gap from where we are & where we want to be”. A plan is a
future course of actions. It is an exercise in problem solving & decision making.
Planning is determination of courses of action to achieve desired goals. Thus, planning is
a systematic thinking about ways & means for accomplishment of pre-determined goals.

 Planning is necessary to ensure proper utilization of human & non-human resources. It is

all pervasive, it is an intellectual activity and it also helps in avoiding confusion,
uncertainties, risks, wastages etc.

Organizing

 It is the process of bringing together physical, financial and human resources and
developing productive relationship amongst them for achievement of organizational
goals.

 According to Henry Fayol, “To organize a business is to provide it with everything

useful or its functioning i.e. raw material, tools, capital and personnel’s”. To organize a
business involves determining & providing human and non-human resources to the
organizational structure. Organizing as a process involves:

 Identification of activities.

 Classification of grouping of activities.

 Assignment of duties.

 Delegation of authority and creation of responsibility.

 Coordinating authority and responsibility relationships.

Staffing

 It is the function of manning the organization structure and keeping it manned. Staffing
has assumed greater importance in the recent years due to advancement of technology,
increase in size of business, complexity of human behavior etc. The main purpose o
staffing is to put right man on right job i.e. square pegs in square holes and round pegs in
round holes.

 According to Kootz & O’Donell, “Managerial function of staffing involves manning the
 organization structure through proper and effective selection, appraisal & development of
personnel to fill the roles designed un the structure”. Staffing involves:

 Recruitment, Selection & Placement.

 Training & Development.

 Remuneration.

 Performance Appraisal.

 Promotions & Transfer.

Directing

 It is that part of managerial function which actuates the organizational methods to work
efficiently for achievement of organizational purposes. It is considered life-spark of the
enterprise which sets it in motion the action of people because planning, organizing and
staffing are the mere preparations for doing the work.

 Direction is that inert-personnel aspect of management which deals directly with

influencing, guiding, supervising, motivating sub-ordinate for the achievement of
organizational goals. Direction has following elements:

 Supervision- implies overseeing the work of subordinates by their superiors. It is the

act of watching & directing work & workers.

 Motivation- means inspiring, stimulating or encouraging the sub-ordinates with zeal

to work. Positive, negative, monetary, non-monetary incentives may be used for this
purpose.

 Leadership- may be defined as a process by which manager guides and influences

the work of subordinates in desired direction.

 Communications- is the process of passing information, experience, opinion etc from

one person to another. It is a bridge of understanding.

Controlling

 It implies measurement of accomplishment against the standards and correction of

deviation if any to ensure achievement of organizational goals. The purpose of
controlling is to ensure that everything occurs in conformities with the standards. An
efficient system of control helps to predict deviations before they actually occur.

 According to Theo Haimann, “Controlling is the process of checking whether or not

proper progress is being made towards the objectives and goals and acting if necessary,
to correct any deviation”. According to Koontz & O’Donell “Controlling is the
measurement & correction of performance activities of subordinates in order to make
sure that the enterprise objectives and plans desired to obtain them as being
 accomplished”. Therefore controlling has following steps:

 Establishment of standard performance.

 Measurement of actual performance.

 Comparison of actual performance with the standards and finding out deviation if
any.

 Corrective action.

The five management principles play an important role in my life in order for me to be
successful in the future. It will serve as my guide if I follow those ideas. By planning what I
will do to attain my goals, organizing/arranging my goals, staffing the right people in my life,
directing my own life in the right direction/path, and controlling/refraining my self from
doing things that will affect my plans in the future. And it also serves as a reference point.