1 What is a Manager? What does a manager do? What is meant by the statement “Managers are no longer bosses”

2 Controlling: Making sure that it works 1.Setting clear performance standards 2.Monitoring and recording actual performance 3.Comparing results against plans and standards 4.Communicating results and deviations to the employees involved 5.Providing positive feedback for work well done and taking corrective action when needed. Corporate Scorecard Why might some managers dread this task?

3 Categories of skills Technical skills Human Relations skills Conceptual skills Do the importance of these skill change as you move up the ladder? Can you train someone to be a successful manager?

4 Does the mix and level of skills change depending on the structure of its organization? Do small companies require a different set of skills than a large company? What skills will you expect from you and those that manage your company? What technical skills will your managers need? What type of employees will you hire and what human relations skills will be needed to make them most productive? How strong are your conceptual skills and are they sufficient? Questions to Develop Your Organization

5 Why Organize? Physical limitations Mental limitations Individual specialization Achievement of goals Tools: Job Description SWOT analysis Organization Chart

6 Organizational Chart General Manager of Accounting and Marketing: Experience in managing account books and finances. In charge of keeping company finances at the correct level.(taxes, wages, purchasing, bills, revenue) Also in charge of promoting our store to our target and secondary audiences to assure we meet our overall goals in sales, and customer base. Authority, Responsibility and Communication

7 Legal Forms Choice of Entity Sole Proprietorship Partnership Sub-chapter C IncorporatedUnincorporated Limited Liability Company Sub-chapter S General Partnership Limited Partnership

8 Advantages and Disadvantages of Sole Proprietorship 1.Ease of starting and ending the business 2.Being your own boss 3.Pride of ownership 4.Leaving a legacy 5.Retention of company profits 6.No special taxes 1.Unlimited liability 2.Limited financial resources 3.Management difficulties 4.Overwhelming time commitment 5.Few fringe benefits 6.Limited growth 7.Limited life span

9 Advantages and Disadvantages of Partnership 1.More financial resources 2.Shared management and pooled knowledge 3.Longer survival 1.Unlimited liability 2.Division of profits 3.Disagreements among partners 4.Difficult to terminate

10 Limited Partnerships Allows for new partners to contribute capital but not have the full level of liability as a General Partnership. General Partners Full personal liability Makes decisions Limited Partners Liability typically limited to capital invested No decision making

11 1.More money for investment 2.Limited liability 3.Size 4.Perpetual Life 5.Ease of ownership change 6.Ease of drawing talented employees 7.Separation of ownership from management 1.Initial cost 2.Extensive paperwork 3.Two tax returns 4.Size 5.Difficulty of termination 6.Double Taxation 7.Possible conflict with Board of Directors Advantages and Disadvantages of Conventional (C ) corporation

12 Advantages and Disadvantages of (S ) Corporation Looks like a corporation but is taxed as the personal income of the shareholders. Documents: Articles of incorporation, bylaws, meets criteria Terminate: Hard & Expensive Length of Life: Perpetual Transfer of ownership: Can sell one class of stock to citizens of U.S. Financial Resources: More money to start & operate; can sell stocks Risks of losses: Limited liability Taxes: Taxed as personal income Mgmt Responsibilities: Separate management from ownership Employee benefits: usually better benefits & wages; more opportunities

13 Limited Liability Corporation Advantages: Passes profits thru to partners: No double taxation Good way to raise capital Limits liability of partners transferability of ownership Able to terminate partnership Can specify role of partners No corporation structure Disadvantages: No say in how business is run: No voting rights Partnerships advantages - limited liability of corporations

14 Distribution of Profits

15 Authority of Principles Addressing Conflict When a business issue occurs, the partners will discuss the issue and take a vote. If an agreement is not attained, when dealing with a larger issue, the partners will bring in a consultant to advise the issue. If it is a personal issue, then the parties not involved will decide the feuding parties resolution. If a partner wants to resign, then he or she will receive six months salary or salary until the end of the year.

16 What are the areas for risk? Define contingency plans for each area of risk. What is our timetable for implementing each stage of the business? Tasks required before opening deadline. What are your short term goals (less than one year) What are your long term goals (3-5 years). Risk Management

17 Def: Company responses to be taken in the event of emergencies, setbacks, or unexpected conditions. What types of events would an organization develop a Contingency Planning Model? Contingency Planning factors Worst case level of change in the environment. Impact on the organization Resources and level of commitment necessary to minimize or reverse impact. Identification of indicators that predict the change. Contingency Planning

18 Gantt Chart

19 To gain support of the community by giving community organizations 3% of our annual profits after the third year of business. Our goal for revenues is to have a 10% growth or more each year for the first 5 years. We hope to pay off all of our debt by the end of the third year. We anticipate our company name to be spread throughout Decatur and it’s surrounding communities, which will be judged by promotional surveys every 3 months. SMART Goals

20 Identify the skill required for your organization. Develop a job description for each position. Create owner and key person resumes. Create an organization chart showing the position and reporting lines. Identify the legal entity for your company and how it fits. Create a formal partnership agreement - Define how conflicts between owners will be resolved. - Define distribution of profits. Define key skills you need to obtain. Develop a list of risk areas and a contingency plan for each. Set 3-5 SMART goals to be achieved over the next 3 to 5 years. Assignment

21 Identify the legal format for your company and why chosen. Identify the organizational chart of your company along with the responsibilities for each person. Include why this person is qualified for this position. Identify any key personnel needed along with requirements. How are strategic decisions made between the principles. How are the principles compensated including leaving? List support persons, if any List each risk followed by proposed contingency plan. Provide a Gantt chart defining steps in the business creation. Identify short term & long term goals Assignment