Managing Operationsand StaffingManaging Operationsand Staffing
Managing Operationsand StaffingManaging Operationsand Staffing
Glencoe Entrepreneurship: Building a Business
Managing OperationsManaging Operations
Staffing and Company PoliciesStaffing and Company Policies
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•Explain the significance of operational plans.
•Describe the purpose of operating policies, rules, and regulations.
Section Objectives
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For your operation to run smoothly, there has to be consistency in theway things are done and how people are treated. This is achieved byimplementing policies and rules.
The Main Idea
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Content Vocabulary
policy
rule
credit
return policy
rework policy
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The goal of first-line management is to put operational plans intoaction.
As your business grows, you may have to delegate someresponsibilities to your employees.
Implementing Operational Plans
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Having a policy on how todeal with a recurringsituation helps simplify day-to-day management.
policy
a statement of goals, purposes,and principles that serves as aguideline for daily businessoperations and supports thecompany’s goals and objectives
Operating Policies, Rules, and Regulations
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In contrast to a policy, arule leaves no room forinterpretation.
rule
a standard set forth to guidebehavior and actions; a rule tellsemployees exactly what theyshould and should not do
Operating Policies, Rules, and Regulations
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Most policy statements cover these issues:
•hours of operation
•credit
•return and rework
•delivery
•customer service
•employee and customer safety
Operating Policies, Rules, and Regulations
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A business that offerscredit may encouragesales, but offering creditalso ties up money.
credit
an arrangement for deferredpayment for goods and services;credit allows a business orindividual to obtain products inexchange for a promise to paylater
Credit Policies
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There are four major credit plans:
•bank credit cards
•charge accounts
•installment plans
•financing
Credit Policies
Three Cs of Credit
11
Businesses that extend consumercredit use the three Cs of credit todetermine whether to extendcredit to customers.
C
C
C
Character
Capacity
Capital
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Credit bureaus give highercredit ratings to people whohave good character.
character
a person’s reputation for honestdealings, such as that of aborrower of money
Credit Policies
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Applicants for credit mustdocument their capacity bystating income andexpenses when filling outcredit application forms.
capacity
a borrower’s ability to repay adebt as judged by lenders
Credit Policies
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A lender is more likely toextend credit to individualsor businesses withsubstantial capital than tothose with modest means.
capital
the overall assets of an individualor a business
Credit Policies
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When you choose to have areturn policy or a reworkpolicy, your business isguaranteeing the quality ofthe goods or services yousell or provide.
return policy
a policy that establishes theconditions under which items thathave been ordered, shipped, ordelivered may be returned
Return and Rework Policies
rework policy
a policy that establishesconditions under which items willbe reworked; that is, doingsomething again because it wasnot done right the first time
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Whether or not to deliver is another part of your place strategy.
Delivery Policies
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Common customer service policies include:
•complaint handling
•product servicing
•customer courtesy
•shopping climate
•restroom access
•response time
•warranties
Customer Service Policies
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Businesses can take two basic precautions to reduce liability andensure the safety of their customers and employees:
1.Train employees in safety and emergency procedures.
2.Reinforce training with signs posted throughout the workplace.
Customer Service Policies
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After You Read
1.Explain the significance of operational plans.
Operational plans govern day-to-day business operations.Operational plans allow a business to run smoothly.
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After You Read
2.Describe the purpose of operating policies, rules, andregulations.
Policies are general statements about how you intend to run thebusiness. They eliminate the need to make the same decisionsrepeatedly. Rules and regulations are standards set to guidebehavior. They let employees and customers know exactly whatthey should and should not do.
Staffing andCompany Policies
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•Explain the staffing process.
•Determine the need for additional policies.
Section Objectives
Staffing andCompany Policies
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Staffing determines who carries out the work of your company and howyour company is perceived.
Consequently, staffing policies and decisions have a direct bearing onthe success of your company.
The Main Idea
Staffing andCompany Policies
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Content Vocabulary
line organization
staff
line-and-staff organization
project organizations
job description
job specification
résumé
recruit
benefits
wages
piece rate
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You make staffing decisions based on how many and what kinds ofemployees you need.
Staffing Your Operation
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To determine your specific staffing needs, you need to assemble fourtypes of documents:
•organization chart
•job descriptions
•job specifications
•résumés
Staffing Your Operation
Staffing andCompany Policies
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The easiest way to begin staffing your business is to design anorganization chart that includes all of the jobs in your business andshows how they are related.
This structure should help delegate responsibility, authority, and work.
Types of Organization
Staffing andCompany Policies
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In a line organization, topmanagement makes thedecisions that affect the entirecompany; middle managementimplements the decisions;supervisory, or first-line,management supervises theactivities of employees; andemployees carry out the plansmade by top and middlemanagement.
line organization
a form of business organizationwhere managers are responsiblefor accomplishing the mainobjectives of the business andare in the direct chain ofcommand.
Types of Organizations
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As your business grows,you must hire staff.
staff
the managers and others whoprovide support and advice to linemanagers, such as accounting,legal services, and training
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A line-and-stafforganization is anothercommon form of businessorganization.
line-and-staff organization
a form of business organizationthat incorporates staff into lineorganization
Types of Organization
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Project organizationssupplement the line andline-and-staff structures.
project organizations
temporary organizations broughttogether from different parts of abusiness for a special project
Types of Organization
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For each position in yourorganization chart, youneed to write a jobdescription and anaccompanying jobspecification.
job description
a statement that describes theobjectives of a job and its dutiesand responsibilities
Job Descriptions and Job Specifications
job specification
document that details the abilities,skills, educational level, andexperience needed by anemployee to perform a job
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To identify staffing needs ina start-up business,examine the résumé ofeach employee torecognize gaps in yourcompany’s staffing.
résumé
a summary of the work andacademic history, skills, andexperience of a prospectiveemployee
Job Descriptions and Job Specifications
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Businesses must establish policies to oversee:
•employee standards
•recruiting and screening employees
•pay and benefits
•training and development
•personnel recordkeeping
Personnel Policies
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When staffing, you can useschool and collegeplacement offices, unionhiring halls, and word ofmouth to recruit newemployees.
recruit
to bring in prospectiveemployees; businesses useclassified ads, employmentagencies, and other placementoffices to find potential employees
Personnel Policies
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To attract and keep goodemployees, you must offercompetitive wages orsalary.
Personnel Policies
wages
an amount of money an employeereceives for every hour he or sheworks
salary
an amount of pay an employeereceives for each week, month, oryear the employee works
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Competitive employeebenefits are alsonecessary to attract andretain good employees.
benefits
extra compensation that workersreceive on a job, such as paidvacation and sick days, flextime,and child care
Personnel Policies
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Another way to payemployees is based onproductivity, either by apiece rate or with acommission.
piece rate
a means of compensation basedon an amount per unit produced
Personnel Policies
commission
a means of compensation basedof percentage of sales
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To make sure that you do not overlook any important policies andrules for your operation:
1.Make a list of operational rules and policies that apply to yourbusiness.
2.Find out about competitors’ policies.
3.Get feedback from potential customers.
Personnel Policies
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After You Read
1.Explain the staffing process.
The staffing process involves designing an organizational structure;writing job descriptions and job specifications; developing andimplementing policies about employee standards; recruiting,screening, hiring, and training employees; and establishing pay andbenefit plans; and maintaining personnel records.
Staffing andCompany Policies
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After You Read
2.Determine the need for additional policies.
Determining the need for and developing additional policiesinvolves (1) reviewing operational processes, (2) reviewingcompetitors’ policies, and (3) getting feedback from potentialcustomers.
Managing Operationsand StaffingManaging Operationsand Staffing
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