This Week Mon. (Sub) – 5.3 Organizing Business Activities – 10 pts. Tues. (Sub) – Create Unit 5 Quizlet - 35 pts. Wed. – Service Day – no class Thurs. – Finish franchise PowerPoints, Kahoot Fri. – Unit 5 Quiz

Organizing Business Activities Lesson 5-3

Learning Goals Understand important principles in designing an effective organization Compare alternative organizational structures for businesses

Effective Organization Many new businesses fail in the first few years Some of the keys to success include: Good organization Skilled management Prepared and Motivated Employees Clear purpose and plan

Setting Direction Every business needs a starting point, something to provide direction A mission statement is a short, specific written statement of why a business exists and what it wants to achieve Mission statements usually begin with “Company XYZ exists to provide…”

Mission Statement Starbucks: “To inspire and nurture the human spirit - one person, one cup and one neighborhood at a time.”

Setting Direction After a mission statement is developed, a business sets goals. Goals are precise statements of results a business expects to achieve A well-written goal must be: Realistic Measurable Time-Specific Consistent with your mission statement

Goals Starbucks: “Ensure 100% of our coffee is ethically sourced by 2015”

Setting Direction After goals are in place, a company needs a plan to meet them Policies are guidelines used in making consistent decisions Procedures are descriptions of the way work is to be done Following policies and procedures should help a business meet its goals

Policy & Procedures Starbucks: Standards of Business Conduct

Organizational Duties When several people work together, they must rely on each other Responsibility - the obligation to complete specific work “that part of the project is your job” Authority – the right to make decisions about how things should be done “this is how we’re going to do this” Accountability – taking responsibility for results “We’re counting on you for this”

Organizational Duties All employees and managers have a set of responsibilities Know who has authority to make decisions Know who will be rewarded/recognized for success Understand they are held accountable for failure

Organizational Structure If only 1 person works at a business, its pretty obvious who does what… When there are multiple employees, there must be an agreement on: What each person will do (responsibilities) Who is in charge of various activities (authority) How activities are structured

Organizational Duties Unity of Command: Clear reporting relationship for all staff of a business Need to know: who is the leader? Span of Command: Number of employees who are assigned to a particular work task and manager Large numbers of people working with little support from a manager is not good! Need to make sure there is a balance Starbucks Video: Working for Starbucks

Organizational Duties Organizational Chart: Diagram that shows the structure of an organization, classification of jobs, and relationships among the classifications Functional organization structure: Work is arranged within the main business functions (production, marketing, records, human resources, etc) Matrix organizational structure: Structure around specific projects, products, or customer groups; may be temporary or long-term Drawbacks of functional organization: little interaction with other functions of business and employees; become focused on specific function and forget about overall vision and goals of organization

Organizational Chart An organizational chart is a good tool for visually displaying structure

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