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Chapter III

MANAGEMENT ASPECT
This chapter discusses the proposed organization form and structure, also
presenting a detailed manpower planning. This portion shows the hierarchy and division
of labor under the business organization, with all the specifications and descriptions
properly assigned. The proponents also exerted much attention on the compensation
scheme and benefits due to the recommended personnel, as well as on the company
policies expected to be observed. Along with all of these is a projected timetable
designed to show how long and in what manner all of these considerations will be
fulfilled.
Form of Business Organization
The proponents, upon discussion, agreed to undertake a corporate form of
business organization. There are three (3) forms of business organization, sole
proprietorship, partnership, and corporation. Corporation as defined by the Corporation
Code of the Philippines is an artificial being created by operation of law, having the rights
of succession and the powers, attributes, and properties expressly authorized by law or
incident to its existence. The ultimate control of the corporation rests with its
shareholders, who are the owners of the corporation. Among the several advantages of
a corporation, these are the three (3) advantages which led the proponents to choose
corporation over the other forms of business organization; First, the shareholders have
limited liability which simply means that the shareholders are not personally liable for the
corporations debt because the corporation is separate from its owners, shareholders
losses are limited to the actual funds invested. Secondly, it has continuity of existence
because it enjoys right of succession. The death, withdrawal, insolvency, or incapacity of
the individual shareholders will not dissolve the corporation. Lastly, ownership interests
can be divided into shares of stocks and these stocks can be transferred without the
consent of the other shareholders, this makes it easier for the shareholders to transact
and transfer ownership interest. These factors generally constitute the attractiveness of
a corporation, which in turn, makes a corporations ability to generate funds greater that
the other forms.

The Greenify, Inc. belongs to the manufacturing industry, making use of


machineries, tools, and manpower to transform raw materials into finished goods.
Greenify, Inc. is an eco-friendly corporation, which envisions to produce quality products
from waste. The company seeks to take advantage of the increasing trend for ecofriendly products and at the same time preserve the environment.
Manpower Requirement
The proponents identified the manpower needs of the company which will take a
huge part on the over-all operations as well as on the success of the business
organization, the list includes a total of twelve (12) people,

which consists one (1)

accountant, one (1) janitor, and one (1) security guard who will be outsourced. The
company will hire one (1) general manager, under his supervision are one (1) sales &
marketing supervisor (1) bookkeeper and (6) production workers employed altogether.

General Manager
Board of Directors

Securit

Utilities

Figure 3.1 Organizational Chart


This figure is a graphic representation of the structure of the organization. It
shows the relationships of the positions and jobs within it and the relative ranks of its
parts and positions/jobs. It shows the line of authority, the proper identification of each
jobs scope of authority.

Job Requirements (Job Specifications and Descriptions)


The employees must be geared with the specifications and qualities necessary to
perform the job properly. The job description pertains to the duties and responsibilities
which are to be portrayed by the employees.
Job Title: General Manager
Job Specification
A general manager must have a Bachelors Degree (preferably Masters degree)
in any business related course with at least five (5) years of experience in any
manufacturing-related job. Must be equipped with great leadership skills and must have
strong computer skills and have substantial knowledge of MS Office. Must be of pleasing
and good moral character, as confirmed by previous employer, if any. And must be
physically fit and mentally capable to perform his tasks.
Job Description
Communicates and implements rules and regulations set by the Board of
Directors to its subordinates. Delivers information to both its superiors and subordinates
for better flow of information. In charge of the direction of the day to day operations and
decision making of the company. Provides assistance to all its subordinates. Assigned to
purchase materials needed for producing the chopsticks, at the best quality at the lowest
price possible. Oversees the overall production activities involved with the creation of the
product. Ensures quality standards and safety requirements are adhered strictly,
Responsible for the hiring and proper training of workers, responsible for the guidance
and for proper communication of rules and regulations to subordinates. Responsible for

the hiring and proper training of workers, responsible for the guidance and for proper
communication of rules and regulations to subordinates.
Job Title: Sales & Marketing Supervisor
Job Specification
Have a Bachelors degree in Marketing with at least three (3) years of experience
related to the marketing function. With excellent interpersonal skills, leadership skills,
and must have strong computer skills and have substantial knowledge of MS Office.
With pleasing and good moral character, as confirmed by former employer, if any. Must
be physically fit and mentally capable to perform assigned tasks.
Job Description
Responsible in coordinating internal and external marketing and promotional
activities like advertising. Helps the company find and build potential buyers, negotiating
and maintaining a good relationship with them. Schedules distribution and other
channeling activities of the products. Ensures a good after-sale relationship with
customers. He oversees proper collection of sales revenue.
Job Title: Bookkeeper
Job Specifications
Must have a Bachelors degree in any accounting program. Must be trustworthy
and honest with regards to recording transactions, as confirmed by previous employer, if
any. Must have strong computer skills and have substantial knowledge of MS Office.
Job Title: Production Worker
Job Specification
Must have reached at least secondary education. Must have a Professional
Drivers License and have knowledge of directions and locations especially in
Pampanga. Must be focused and works efficiently and productively. With pleasing and
good moral character. Must be physically fit to be able to perform assigned tasks.
Job Description
They are responsible for the transformation of rice husks to chopsticks, must
ensure the quality of the end product and avoid, as much as possible, defective

products, to prevent reworks and additional costs. Is in charge of the delivery of the
products to the customers.

Table 3.2 Employees Weekly Schedule of Work


Position
General
Manager
Production
Supervisor
Sales & Mktg
Supervisor
Prod. Worker
(Machine 1)
Prod. Worker
(Machine 1)
Prod. Worker
(Machine 2)
Prod. Worker
(Machine 2)
Prod. Worker
(Machine 3)
Prod. Worker
(Machine 3)
Quality
Inspector
Driver

Sunday

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Working Days

Non-working Days

Compensation Scheme and Benefits


The employees of the business are the key factors for the success of the
business operations. They are the mind of the business, directing the path the business
is taking. Unlike other business factors, employees have the intellect to act upon the
business objectives. The company, as a means of recognition to the importance of its
employees, provides fair and equitable compensation. To produce and be able to retain
such workforce the company is providing a reasonable compensation in the form of
salaries and benefits. The variations on the salaries is due to the varying job positions
and scope of responsibilities. The compensation scheme for the rank and file employees
will be guided by the daily minimum wage rates given by the Department of Labor and
Employment. And the top managements salaries will be based on standards and
equitable measures. Salary will be given every 30th of each month.

Table 3.3 Daily Rate and Monthly Salary of Employees


POSITION

DAILY RATE

MONTHLY SALARY

GENERAL MANAGER

500

10875

ACCOUNTANT

250

5145.83

BOOKKEEPER

357

7764.75

450

9787.5

PRODUCTION WORKERS (6)

357

7764.75

SECURITY

357

7348.25

SALES AND MKTG


SUPERVISOR

Table 3.3 Daily Rate and Monthly Salary of Employees


POSITION

DAILY RATE

MONTHLY SALARY

UTILITIES

357

7348.25

TOTAL

2628

56721.5

In addition to their salaries, as compliance to the law, the employees will be given
the government mandated employee benefits. These benefits are classified into three,
they are as follows: Wage and Compensation Benefits, Leave Benefits, and Mandatory
Government Benefits and Contributions. The following benefits are not given to the
outsourced personnels.

Wage and Compensation Benefits

13 Month Pay

This benefit is the result of employees handwork and dedication which enable
them to have enough money for celebrating Christmas and for welcoming New Year.
During the presidency of President Ferdinand Marcos in 1975, he issued Presidential
Decree No. 851, that all workers whose salary was below Php1,000 be given 13th month
pay. After the ouster of Marcos, former President Corazon Aquino amended the law,
removing the Php1,000 cap and thus allowing more people to get their share of the 13thmonth pay.

Retirement Pay

Upon the age of 60 years or more, the employee who has served at the
establishment for at least five years may be granted a retirement pay equivalent to at
least one-half month of salary for every year of service. A fraction of at least six months
is considered as one whole year.
The one-half month salary includes:
1. 15 days salary based on the latest salary rate;
2. Cash equivalent of 5 days of service incentive leave;
3. One-twelfth (1/12) of the 13th month pay

Overtime Pay

Under Article 87 of the Labor Code, the employee who renders overtime (more
than eight hours of service per day) will be given additional compensation equivalent to
his regular wage plus at least 25% premium. Overtime pay for holiday or rest day shall
be paid an additional compensation from the rate of the first eight hours on a holiday or
rest day plus at least 30%. On a Special Non-Working day, or rest day, an additional
compensation of 30% premium will be paid in addition to the rate of the first eight hours
on holiday or rest day. Undertime work on any particular day shall not be offset by
overtime work on any other day.
Leave Benefits

Maternity Leave

Any pregnant woman employee who has worked with the company for at least
six months will be granted a maternity leave of at least two weeks prior to her due date
(expected date of delivery) and four weeks after normal delivery or miscarriage with full
pay based on her regular salary. A total 60 to 80 days is granted for the companys
employees as compliance with the law. The Maternity Leave benefit is effective up to the
first four deliveries of the woman employee working in the company. However, Senate
Bill 2982, or the Expanded Maternity Leave Law of 2015, has been approved on its third
(3rd) reading on January 18, 2016. If enacted into law, will grant 100 days of maternity
leave for employees in the government and private sector, regardless of the type of
delivery.

Paternity Leave

The R.A No. 8187, or Paternity Leave Act of 1996, grants seven days of fully paid
leave to married fathers. This is effective up to the first four deliveries of the legitimate
spouse.

Parental Leave for Solo Parents, or Solo Parenting Leave (SPL)

Seven days leave with pay for every year of service, on top of other leave
privileges, e.g. Maternity or Paternity Leave.

Special Leave Benefits for Women

This entitles women who underwent surgery due to gynecological disorders to


two months leave with full pay, as stipulated in R.A. 9710 or the Magna Carta of
Women. This applies to employees who have rendered at least six months of service
with the company. On the other hand, victims of violence against women, as stipulated in
R.A. 9262 or the Anti-Violence Against Women and Their Children Act of 2004, are
entitled to 10 days leave with full pay.

Mandatory Government Benefits and Contributions


The following government contribution will be automatically deducted from
regular employees based on their salary, with the following benefits.

Social Security System (SSS) Benefits


Covered employees are entitled to a package of benefits under the Social

Security and Employees' Compensation (EC) Programs in the event of death,


disability, sickness, maternity and old age. Self-employed and voluntary members also
get the same benefits as covered employees, except those benefits under the EC
program.
Basically, the SSS provides for a replacement of income lost on account
of the aforementioned contingencies. The benefits under the Social Security Program
are:
Sickness Benefit is a daily cash allowance paid for the number of days a
member is unable to work due to sickness or injury. A member can be granted sickness
benefit for a maximum of 120 days in one calendar year. Any unused portion of the
allowable 120 days sickness benefit cannot be carried forward nor added to the total
number of allowed compensable days for the following year. The sickness benefit shall
be paid for not more than 240 days on account of the same illness. If the sickness or
injury still persists after 240 days, the claim will be considered a disability claim.

Maternity Benefit is a daily cash allowance granted to a female member


who was unable to work due to childbirth or miscarriage.

Disability Benefit, adopting the World Health Organization's (WHO)


definition, disability is any "restriction or lack (resulting from impairment) of ability to
perform an activity in the manner or with in the range considered normal for a human
being. The redesigned SSS Disability Benefit program adopts the International
Classification of Diseases and Related Health Problems codes and takes into account
the medical management of illnesses and injuries and their corresponding impairment
ratings.
Retirement Benefit is a cash benefit either in monthly pension or lump
sum paid to a member who can no longer work due to old age.
Death It is a cash benefit either in monthly pension or lump sum paid to
the
beneficiaries of a deceased member. The primary beneficiaries are the legitimate
dependent spouse until the person remarries, and the member's dependent
legitimate,legitimated, or legally adopted, and illegitimate children who are not yet 21
years old. In

the absence of primary beneficiaries, the dependent parents shall be the

secondary beneficiaries. In their absence, any other person designated by the member
as
beneficiary in the member's record.

Funeral Benefit is a cash benefit given to whoever pays the burial


expenses of the deceased member or pensioner.

National Health Insurance Benefits


Philippine Health Insurance Corporation provides medical insurance to
the Philippines. Provides financial assistance for inpatient and outpatient hospitalization,
as well as Z Benefit Packages for patients undergoing prolonged hospitalization and
expensive treatments and suffering from Millennium Development Goal (MDG)-related
illnesses. Members are provided with health and hospitalisation subsidies should they or
a dependent be hospitalised. Monthly contributions is dependent on the employees
actual monthly salaries and the amount of employee contribution is matched equally by
the company.

PAG-IBIG Benefits
This entitles employees to avail of a Housing Loan, Calamity Loan, and

Multi-Purpose Loans that aim to provide financial assistance to their needs.


Pag-IBIG Fund guarantees the refund of member's total accumulated
savings (TAV), which consists of the member's accumulated contributions, the employer
counterpart
contributions, if any, and the dividend earnings credited to the member's account
upon occurrence of any of the following grounds for withdrawal: Membership maturity,
Retirement, Permanent and Total Disability or Insanity, Separation from duties due to
health reasons, Permanent departure from the country, and Death.

Table 3.4 Compensation Scheme and Benefits Year 1 to Year 5

POSITION

DAIL
Y
RAT
E

ANNUAL
GP

MONTHLY
GP

EE

ER

EC

PHILHE PAGALTH
IBIG

EE
REDUC
TION

ER
CONTRIBUTION

GENERAL
MANAGER

500

130500

10875

399.70

820.3

10

125

100

634.7

1055.3

ACCOUNTANT

250

61750

5145.83

BOOKKEEPER

357

93177

7764.75

290.7

599.3

10

100

100

500.7

809.3

SALES
MKTG SUP

450

117450

9787.5

363.3

746.7

10

112.5

100

585.8

969.2

PRODUCTION
WORKERS (6)

357

93177

7764.75

290.70

599.3

10

100

100

500.7

809.3

SECURITY

357

88179

7348.25

UTILITIES

357

88179

7348.25

Total

3449

1138297

94858.08

2797.9

5762.1

90

937.5

900

4725.4

7689.6

&

Table 3.4 To compute for the annual gross pay the formula used was daily rate
multiplied by the total number of working days in a year. The total workings days were

247 and 261 for the outsourced personnel and the insourced employees, respectively.
The annual gross pay divided by number of months in a year (12) is equal to the monthly
gross pay. Columns five (5) to eleven (11) represents the employee and employer
contributions for SSS, PhilHealth and PAG-IBIG. The EE reduction column signifies the
directly withheld contributions from the employees monthly salaries. The ER contribution
column shows the Greenify, Inc.s contributions to the SSS, PhilHealth, and PAG-IBIG of
the insourced employees. Only the insourced employees receive benefits from
employers contribution to SSS, PhilHealth, and PAG-IBIG.

Uniforms
The company will provide its employees uniform & clothing. The company
intends to provide uniform and clothing for reasons like: promoting the brand through the
uniform, giving the business a more professional look, and to make it easier for
customers to identify its staffs.

Each job position is designated a particular color for purposes of identification.


Employees with the same job position is required to have the same uniform for reasons
like uniformity and consistency. It is also suggested that they wear clothes that will
enable them to move properly and will make them feel comfortable.

Figure 3.2 General Manager Uniform

Greenify

Figure 3.3 Sales & Marketing Supervisor Uniform


Figure 3.4 Production Workers Uniform

General Company Policies


Pre-Employment Requirements
Upon application, the applicant shall have the necessary requirements before he/she
can assume a position:
Resume with two (2) recent 2x2 photos,
Original Copy/Photocopy of NSO Birth Certificate,
Scholastic Credentials/Transcript of Records,
Certificate of Employment (COE), from former employer (if any),
NBI/Police Clearance,
Drug Test Results,
Social Security System (SSS) Number,
Tax Identification Number (TIN), and
Home Development Mutual Fund (PAGIBIG) and Phil Health Numbers

Training and Development


As stated numerous times, the company considers its people as the mind and
intellect of the company. With the help of the employees the companys objectives may
be achieved. In response to that, extensive trainings will be provided to employees, upon
employment and during the term of employment. Before the start of operations, newly
hired employees will be given orientations and trainings regarding their duties and
responsibilities. Part of this trainings is the proper usage or the steps in operating the
machineries and equipments. Included in these trainings and orientations is the
familiarisation of the production site and to train them the processes of production:
grounding of rice husks, filtering of unwanted rice husks, creating the patented formula
(melanine and formaldehyde resin),
combining the rice husks and the patented formula, placing of the mixture to the hightemperature compression machine, then packaging of inspected finished products.
Code of Conduct
Greenify, Inc. is devoted to resource preservation, responsible and efficient use
of the companys resources is highly encouraged and required. As a result, the
proponents believe that it is best to impose proper practices that are to be adopted and
adhere to social responsibilities.
To serve the community, consumers, as well as the environment well, a Code of
Conduct is drafted to provide guidelines. The code addresses concerns regarding
certain situations and conflicts on the workplace and about customers and suppliers as
well. Each one is essential to achieve the objectives of the company and also the
compliance and performance of the employees.
Labor term
All terms and conditions related to employment will be in accordance with the
agreement written in the employment contract. All ratification and changes will be
allowed provided there is agreement between the two parties and will not affect the
consistency of the companys terms and policies. During employment, Greenifys
employees must not have any interest in any business or operation that would compete
with Greenifys current operations.

Attendance Policy
The company is imposing a policy, No Work, No Pay. This is to mitigate
unreasonable absences and continuous absences. This policy also sets forth the
consequences for failing to adhere to a schedule or for excessive absences. Verbal
warning applies to the first offense. Second will be written warning.Third offense, the
employee will be suspended. Employee will be dismissed on the fourth offense.
Operating Policies
1. The business operations is from 8:00am-5:00pm, from Monday to Saturday.
2. Employee will have eight (8) working hours and one (1) hour allotted for lunch break.
3. During the week each employee is given one (1) day off from work.
4. Attendance should be documented on a daily basis.
5. Non-working holidays declared by the law will be considered and additional
compensation will be given to the employees who are assigned to work during that
day.
Progressive Discipline Policy
1. Verbal Warning
Some reasons for verbal warning, first late arrival for scheduled shift, first
incident of not following proper work procedures, first incident of not wearing a proper
uniform.
Employee will be given a verbal warning regarding the unacceptable behavior or
action.The when and how of the said action will be mentioned. Employee will be
given an opportunity to explain the situation and their actions. Employee will be informed
that further disciplinary action, up to and including termination, will follow if unacceptable
behavior continues. Nothing will go into their records, but failure to comply with
companys policies will lead to more severe sanctions.
2. Written Warning
Some reasons for written writing include: inappropriate or rude interaction with a
customer such as a raised voice, sarcastic comments, or impatience, not showing up for
a scheduled shift with no reasonable explanation, insubordination such as talking back
to management or lack of adherence to service standards.

Employees will be given written warnings after second offense or for actions
which severity is enough for one. Same procedures as with verbal warning will apply. In
addition to that a written warning will be given and a document will be signed by the
employee as record. Continuous misconduct may lead to termination.
3. Suspension
Some reasons leading to suspension include: repetitive lateness or absences
with no reasonable explanation, an incident of verbal abuse to customer, co-worker or
management and repetitive lack of adherence to appearance or service standards.
Employee will be given documentation regarding the suspension relating to the
undesirable behaviour or action in the event that the behaviour had either been
discussed in a previous verbal or written warning or the behaviour was considerably
severe in nature. The documentation will discuss regarding the length of the term of
suspension. Employee will not receive any salary and benefit during suspension.
4. Termination
Management will assess the severity of the action, if proven enough, termination
will push through. Careful investigation and fair imposition must be applied to avoid
litigations and motives of discrimination. The employee will be given proper notice
beforehand and will be given enough time to prepare his/her belongings.
Resignation Policies
1 Notice of Resignation should be presented to the general manager at least fourteen
(14) calendar days before the date of definite resignation from work.
6. All resignations must be in writing and should include the intention to resign, the
reason and the definite day of resignation from work.
7. Any employee who resigned and eventually return to the company will be treated as a
new employee. Salary, benefits, leaves, etc. will be given treating the employee as a
newly hired employee.
Confidentiality of Information

Information obtained as an employee regarding the operations, results and


strategies of the Greenify, Inc. shall be kept confidential. They must be kept in the
strictest confidence within the company and disclosure to outsiders must be prohibited,
failure to comply may result to corrective sanctions.
Project Timetable
First Activity. Project Conceptualization
This stage involves the general and over-all descriptions of the project. This
stage give complete definition that helps in formulating distinct concepts needed to come
with a reliable budget estimate. How well a project is conceptualized aects how well the
project is dened and appropriately scoped.
This abstraction of the project starts by obtaining information and brainstorming
with all persons concerned to come up with a product or service the customers
nowadays demand and also considering its requisites in all aspects like the economy,
community where it will operate and the environment. The chosen product will be the
basis in defining the target market of the study. The proponents shall then decide on
what pertinent form of business and suitable project location. This stage will be done in
two (2) weeks.

Second Activity. Preparation of Feasibility Study


This stage will observe the likelihood of the proposed project in turn, results will
define whether the project is marketable or not. It will involve the actual determination of
business plans, budgeted and estimated sales, budgeted merchandise and target
inventory, and the competitors in the industry chosen. It shall have a time frame of two
(2) weeks.
Third Activity. Incorporation and Business Legislation
This stage is to ensure full and legal operation of the business through proper
registration. The first step is to register your business with the Bureau of Internal
Revenue, SEC, Local Government Units, Social Security System (SSS), PhilHealth, and
PAG-IBIG.

This activity involves the processing of all legal documents necessary for
business operations. Such registration involves registration reserving and registering the
business name in Securities and Exchange Commission (SEC). It involves the filing of
the Articles of Incorporation and the by laws. After which, the company will secure a
barangay clearance, which is a prerequisite in having a business permit/mayors permit
together with the Certificate of Registration from SEC. After availing of these, the
company will register on the nearest Revenue District Office, which is Bureau of Internal
Revenue - Revenue District Office No. 21B - South Pampanga. The company will be
hiring employees for their services, therefore, it is required to register on SSS,
Philhealth, and PAG-IBIG. The term employee denotes any person legally employed in
the Philippines, any person compulsorily covered by the GSIS under the Commonwealth
Act 186, or any person compulsorily covered by the SSS under Republic Act 1161. Such
employee is automatically covered for these government mandated employee benefits.
This includes self-employed individuals or freelancers. In total, the creation of the
corporation will require one (1) month.
Fourth Activity. Funding and Capitalization
This stage is concerned with the funding and the actual capitalisation of the
business. This stage involves the gathering of monetary and non-monetary (industrial)
capital. It will take approximately one (1) month.

Fifth Activity. Building Improvements


In this stage, initial plans such as floor plan, building layout, division of the site,
and exact physical specifications of the proposed site for operations shall be prepared.
This also includes the insertion of the furniture and fixtures needed in the office. The
renovations for particular specifications required and finishing touches will then follow.
Since there is already an established structure, further minor renovations in this stage
will take approximately two (2) months.

Sixth Activity. Purchase and Installation of Equipment and Machineries


This stage involves negotiating with the equipment and machine suppliers to
have the best quality at the lowest price possible. After the importation of the equipment
and machineries, proper placing and installation will take place, based on the floor plan

established by the company. Purchase and installation may take place in approximately
one (1) month.

Seventh Activity. Recruitment, hiring, and intensive training of manpower


For administrative and supervisory personnel positions, indirectly related to
production, the activity will commence with the recruiting of qualified individuals who are
willing and are suitable for the job position. They will be given time for to obtain
requirements. The hired employees will be given orientations which will involve the
duties and responsibilities assigned to a particular job position, also they will be toured in
the company premises and will be oriented on the companys vision, mission, objectives,
policies, and all other essential information.
For the workers who are directly involved in the production of the chopsticks,
after going through the requirement process mentioned above, they will undergo the
same orientations, especially inside the production site and regarding the machineries
involved. They will also be subjected to trainings, which will improve their proficiency
regarding the operations that will contribute to the maximization of the potential
effectiveness and efficiency of the manpower. This will be fulfilled in one (1) month.
Eighth Activity. Purchase of Raw Materials Needed
This stage entails the determination of suppliers who are selling melanine and
formaldehyde resin in the best quality at the lowest price. Also, it involves the negotiation
with famers regarding their waste of rice husks, the terms regarding the purchase of the
rice husks and the possible socio-economic activities for the betterment of the lives of
the farmers. This will done within one (1) week.
Start of Business Operations

Ninth Activity. Start of Business Operations


This stage covers the opening and actual commencement of business
operations. In accordance with the going concern principle, the business is expected to
operate indefinitely.

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