1. This Week’s Agenda
Tuesday – Organizing Business Activities, Create Quizlet
Wednesday – Assignment catch-up, review on your own, Kahoot
Thursday – Review (10 min,) Test (Online) Friday – Shark Tank!

2. Organizing Business Activities
Lesson 5-3

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

4. 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

5. 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…”

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

7. 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

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

9. 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

10. Policy & Procedures
Starbucks:
Standards of Business Conduct

11. 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”

12. 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

13. 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

14. 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

15. 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

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