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UNIT 4. Business organization

Introduction

TEXT A.

Every business organization has to plan how to achieve its objectives. First of all, it needs to produce and market the goods or services it provides as efficiently as possible. But these primary objectives will only be achieved if plans are formulated to solve a number of other problems; how to find the necessary financial investment, recruit and train staff, purchase raw materials, maintain plant, etc.
In any large organization, it is not possible for the individual to take and implement all the necessary decisions on his own. Work has to be specialized. Qualified people must be appointed to work in each of the areas of operation, and a specialist in one area is not expected to take and implement decisions in some other area.

 

Exercise 1.
Choose the correct alternatives.
The first responsibility of (a) the workers/management in a large business organization is to (b) plan/find finance. This means that aims have to be identified and procedures designed for achieving (c) them/it. Then responsibilities have to be specified for (d) individual workers/management so that each worker knows exactly what he is expected to achieve.

CLUES:a. Who does the planning?
b. Is finance needed before overall aims have been planned?

 

Exercise 2.
Decide whether the following statements are true or false. Write 'true' or 'false" in your notebook.
a. For an organization to be successful, well-qualified persons must be appointed to key positions.
b. Large business organizations are sub-divided into several departments (for instance, manufacturing, sales, engineering).
c. Workers are free to follow the organization plans or not, as they wish.
d. In a successful big business, the managing director takes every decision by himself, without asking for advice.
e. Workers work most effectively (successfully) when they are not certain of their responsibilities.

CLUES:a. Look at Text A, paragraph 2.
b. Do you expect that a large company will include manufacturing, sales, etc. in a single department?
c. The second responsibility of management is control, to sure that the plan is carried out.

Focus: Expressing necessity.

What happens to a business organization if well-qualified persons are not appointed to key positions? The business fails.
So we say:
Well-qualified persons must be appointed to key positions.

This sentence can be written in other ways:
Well-qualified persons have to be appointed to key positions.
or Well-qualified persons need to be appointed to key positions.
or It is necessary that well-qualified persons are appointed to key positions.

We can also say:
The directors must appoint well-qualified persons to key positions.
or The directors have to appoint well-qualified persons to key positions.
or The directors need to appoint well-qualified persons to key positions.
or It is necessary that the directors appoint well-qualified persons to key positions.

Exercise 3.
The items on the right are necessity sentences. Match each 'necessity' sentence to the sentence on the left which it best fits.

a. The average employee works better when he knows exactly what he is expected to do. 1. It is necessary that their organizational structures should be capable of modification to meet the needs of growth and change.
b. The owner of a small business may be the only manager.2. So he needs to delegate some of his managerial functions to other personnel.
c. The owner of a large factory cannot take every decision by himself.3. Therefore, his job must be clearly defined.
d. Most businesses expect to operate over many years.4. This is why there has to be an efficient system of communication in the business.
e. A manager bases his decision on the information he is given.5. So he has to perform all the managerial functions by himself.

 

CLUES:1. 'capable of modification' means able to be changed.
2. 'personnel' may be defined as employees.

Exercise 4.
If you are working on your own, complete passage 1 with the phrases given after it. If you are working with a friend, one of you complete passage 1 and the other complete passage 2. Write the completed passages in your notebook.

PASSAGE 1.
In order to implement these decisions, managers have (a) ______ from their subordinates. This is only possible when (b) ______ understand the extent of the authority possessed by their superiors.
In (c) ______ it is most important that (d) ______ through good communication channels. Availability and prices of raw materials, the price of labour, (e) ______, market demands, are all continually changing, and the manager (f) ______ in order to cope satisfactorily with the (g) ______. This need (h) ______ exists at all levels of management.

PASSAGE 1 PHRASES.
1. the subordinates
2. must be well enough informed to take decisions
3. information should pass freely
4. constantly changing situation
5. to be able to exact obedience
6. for good communications
7. the condition of capital plant
8. every business.

CLUES:If you are working on your own, check your answer by completing passage 2. But be careful! The two passages are slightly different.

 

PASSAGE 2.
The free flow of information through (i) ______ is most important in every business. (j) ______ in the supply and price of labour and raw materials, competitors' circumstances, and (k) ______. In order that (l) ______ with this constantly changing situation, and can alter (m) ______, the manager needs to have access (n) ______. This need is present at all levels of management. But he can only enforce the decisions he takes when (o) ______ obedience. This means that the juniors have to be made to understand and accept the type of authority (p) ______.

PASSAGE 2 PHRASES.
1. the state of the market
2. he can cope
3. decisions and make new ones
4. his juniors give him their
5. effective channels of communication
6. exerted by their seniors
7. to information about these factors
8. Changes are continually taking place.

CLUES:Compare the completed passages 1 and 2. But be careful! The two passages are slightly different.

The paragraphs in passages 1 and 2 are differently ordered. Decide which paragraph should come first, and which passage is best.

CLUES:One paragraph shows that the manager must have accurate information in order to make a decision. One paragraph shows he can only take action on his decision if his subordinates understand his authority. Which order is best? Which passage follows the best order?

 

Exercise 5.
The diagram shows the organization of a business. Use the terms on the right to complete it.

1. Manager, plant A
2. Salesmen
3. Vice President, sales
4. Secretary - Treasurer
5. Office clerks
6. President
7. Foreman, shift 1
8. Foreman, shift 2.

Exercise 6.
Look at the diagram you completed in Exercise 5 and answer these questions.
a. Which of the following is directly superordinate (senior) to the Manager of plant B?
1. the Manager of plant A
2. the Vice President of manufacturing
3. the Secretary Treasurer
b. Which one of the following is equivalent to the Foreman of shift 1 of plant A?
1. the Sales Manager
2. the Foreman of shift 2 of plant B
3. an office clerk
c. Which one of the following is not directly subordinate to the Vice President of manufacturing?
1. the Office Manager
2. the Manager of plant B
3. a worker
d. To whom is the Sales Manager directly responsible?
1. the Secretary Treasurer
2. the President
3. the Vice President of sales.

CLUES:a. Follow the line up from the Manager of Plant B. To whom does it lead?

 

Exercise 7.
The diagram that you completed shows the line type of business organization. Here are some features of line organizations. Decide what advantages a line organization has, and what disadvantages.
a. As long as each employee carries out the orders of his immediate superior, he is not likely to be criticized.
b. Each manager must be skilled in all the different aspects of his job.
c. It is necessary for senior managers to spend most of their time reading reports and making decisions about the day-to-day problems of running the business.
d. Each employee is responsible to only one superordinate.

CLUES:Text B will help you check your answers.

 

TEXT B.
Line organization.
A line organization is one in which there is a direct flow of authority from the top executive to the rank-and-file employee, usually through several lesser executives at various managerial levels. It is sometimes called the military type because each person has someone immediately over him. Although modern armies have become too complex to rely exclusively on a line organization, they still use the direct chain of command.
There are many advantages inherent in this form. It is simple and easy to understand. Responsibility is clearly defined and each worker, regardless of his rank, reports to but one individual. This simplifies discipline. Decisions can usually be rendered quickly, and executives must produce or be replaced. As long as each employee carries out the orders of his immediate superior, he is relatively free from criticism, which makes for harmonious working conditions.
There are, however, many disadvantages to the line type of organization. Each supervisor needs to be a master of many diverse angles to his job. He should be able to handle his men, keep the machines running, invent new processes, recommend pay increases, and train new employees. Frequently he may be outstanding at one or two of his numerous responsibilities and very poor at others. The line organization also has the disadvantage of placing so much final authority and direction at the top that the individual concerned, instead of devoting his attention to working out important matters of policy and general practices, finds most of his time devoted to reading reports and rendering decisions on operating problems. Coordination, of the different 'lines' is difficult to achieve, particularly in a complex, large-scale industry.

Glos R.E. and Baker H.A. Business: Its Nature and Environment, South-Western Publishing Co 1972.

 

Exercise 8.
The phrases on the left came from Text B. Which of the phrases on the right is closest in meaning within the context?

a. each worker, regardless of his rank, reports to but one individual. 1. Each worker is responsible to who ever he wishes.
2. Each worker is responsible to more than one individual.
3. Each worker is responsible to only one individual.
b. Decisions can usually be rendered quickly,1. Decisions can usually be acted upon quickly.
2. Decisions can usually be changed quickly.
3. Decisions can usually be made quickly.
c. executives must produce or be replaced,1. If executives do not wish to do their work, they can give it to some other worker to do.
2. If executives do not do their work satisfactorily, then they will lose their jobs.
3. If executives do not enjoy their work, they can change it.
d. which makes for harmonious working conditions.1. .And this freedom from criticism makes working conditions more peaceful and friendly.
2. And this freedom from criticism makes working conditions quieter.
3. And this criticism makes working conditions more unfriendly.
e. Each supervisor needs to be a master of many diverse angles to his job.1. Each supervisor has to control people who want his job.
2. Each supervisor must be skilled in all the different aspects of his job.
3. Each supervisor needs to show his authority.
f. he may be outstanding.1. He may be unusually good.
2. He may be unusually bad.
3. He may be very important.
CLUES:a. Look at exercise 7, d.
b. Look at exercise 7, c.
d. 'which' refers to 'he is relatively free from criticism', not just 'criticism'.
e. Look at exercise 7, b.

 

Exercise 9.
Write out the following sentences in the order that makes best sense.
a. And here is where computers play a role.
b. Although office clerks can present the necessary data and numerous alternatives to help the manager arrive at a decision, all this is time consuming and there is no tested formula for making the right choices.
c. They can evaluate and present decision possibilities within less time than would be required by manual means and more accurately too.
d. Computers are playing an increasingly important role in evaluating data and helping in decision-making.

CLUES:Text C will give you the answer.

 

TEXT C.
This text comes from an advertisement for computers.
Computer way to better efficiency.

Computers are playing an increasingly important role in evaluating data and helping in decision making.
Although office clerks can present the necessary data and numerous alternatives to help the manager arrive at a decision, all this is time consuming and there is no tested formula for making the right choices.
And here is where computers can play a role. They can evaluate and present decision possibilities within less time than would be required by manual means and more accurately too.
Producers have now come up with television-type terminals which can show decision-makers the effects of their choice.
Dataware has come out with an electronic worksheet called the Visicalc, designed specially for use with the Apple computer system. It virtually eliminates calculators, and does away with papers and pens in developing plans and analysing results.
Any problem you wish to tackle can be solved quickly and accurately by using the Visicalc and the Apple computer system.
Managers can now use this to plan budgets, and develop pricing strategies. Professionals in finance can also prepare statements, compute ratios and modify projections with the help of Visicalc and the Apple computer system.
Scientists and engineers can study causes and effects all within a matter of seconds instead of hours or days.
Modern and fast-expanding business enterprises can employ the use of the system to better efficiency and improve accuracy.
The Visicalc and Apple computer system increases personal productivity and it can be put to work immediately because it allows a person to write and use complex 'programmes' without learning a programme language.
Thus, modern technology has developed so much that one has no excuse for being left behind in the race for better office efficiency and accuracy a pre-requisite for success in today's competitive world.

The Star, (Kuala Lumpur) 23 February 1982.

 

Exercise 10.
The phrases on the left come from Text C. Which of the phrases on the right is closest in meaning within the context?

a. by manual means 1. By using unskilled labourers.
2. By working with the hands (i.e. not using electronic equipment).
3. By doing the work once a year.
b. television-type terminals1. Equipment that looks like an ordinary television set and is used for transmitting information.
2. Equipment for destroying paper.
3. An ordinary television set that gives information about business.
c. personal productivity1. The amount of work that the individual needs to do.
2. The amount of work that the individual is able to do.
3. The time spent working.

 

Exercise 11.
Which of the following points does the writer of Text C agree with, which does he disagree with, and which does he not mention?
a. Managers who do not use computers depend on precise formulae (rules, specifications) for choosing the facts on which to base their decisions.
b. Small computers cost less than they did ten years ago.
c.
Up-to-date businessmen do not have to depend on the accuracy and efficiency of clerks.
d. Many workers lose their jobs when a business starts using computers.
e. Businessmen can use the Visicalc and the Apple computer system to plan how to use capital and how to price their goods.
f. Only businessmen can make good use of computer systems.
g. Businessmen who use Visicalc, have no need at all for calculators.

CLUES:a. Look at Text C, paragraph 2.
c. Look at paragraphs 2 and 3.
e. Look at paragraph 7.
f. Look at paragraphs 7 and 8.
g. Look at paragraph 5. The word 'virtually' means nearly always.

 

Exercise 12.
In your notebook, draw a diagram to show the organization of a business that you know about in your country. Does this business use a computer? Do you think it would be more efficient if it used a computer? Discuss your answers with your teacher.

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