April 18, 2017

Organizing Resources and Acquiring Them - The Supply Chain

Fayol explained management as planning, organizing, coordinating, commanding and control.

Koontz explained management as planning, organizing, staffing, directing and control.

Prof. Narayana Rao explains management as planning, organizing, resourcing, executing and control

In this article organizing and resourcing are explained in more detail.

In the planning stage, market demand is assessed for a proposed product, the feasibility of manufacturing it assessed and profitability is estimated based on the prices for finished product and cost for the various inputs used in the production process and the facilities to be employed. Even parametric estimating can be used during the planning. The cost of a production of a product from a current player in the market can be taken as the basis and the cost at which the proposed project will manufacture it is estimated by creating estimates for the relevant components or features. For other features and components, the project may assume the same cost as the present incumbent.  During the planning phase the errors allowed are large and to compensate for it, the expected profit also has to be large.

During planning phase, many of the resources required to run the business are visualized from aggregate angles. Like for example, one may say a machine shop of 20 machines and give a rough estimate of capital expenditure involved and operating expenses. It is during organizing stage that each and every machine is specified and the location within the machine shop where it will be installed with decided. So the detailed plan for the physical facilities is made during the organization phase. Then the number of operators required to operate the machines and other equipment is determined. The managerial cadre of employees required to plan and supervise the work is also determined during this stage. Approximately, one can say, that span of control is 10. This will mean around 11% managerial staff will be there in an organization and rest will be actual front line people who produce, move and sell.

After the organization of the physical facility and man power are finalized, the management has to acquire these resources. They have to mobilize adequate finances, buy land, build facilities, buy equipment and install them. They have to search and select suppliers, distributors and retail shops that sell their products. They have to recruit employees. All this acquisition of resources has to be done by the promoter of a business enterprise. Even when the company is running, the task of acquiring key resources is the responsibility of the senior managers in the case of a company or department. In case of project, the project manager has to acquire the resources from his senior management to carry out his task. Once again he may be given finance by the senior managers but he has to use that finance and acquire other resources internally or externally. Every manager must have the skills of organizing and resourcing.

Related Articles

Resourcing Projects

Resourcing - A Function of Management

Resourcing - Resource Management Related Issues

The Nature of Organizing - Review Notes

Top Management Challenges

This article is part of #AtoZChallenge 2017 for Blogging Posts. My Theme for the Challenge is Top Management Challenges - Full List of Articles  http://nraomtr.blogspot.com/2016/12/a-to-z-2017-blogging-challenge-top.html

To Know More About A to Z Blogging Challenge

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