Business Planning and Administration

• Planning is defined as the process of developing a business's future plan.

Administrative Process: PODC

• Planning, organization, direction, and control are involved

Planning and its components

• Operative planning involves short-term plans describing what the organization must do to achieve success.
• Strategic planning involves long-term plans focused on developing and implementing plans to achieve objectives based on the organization.

Roles of an Administrator

• An administrator is in charge of planning, organizing, directing, and controlling resources to achieve established goals.
• Managerial functions include creating strategies, managing resources, leading teams, and monitoring results.

Interpersonal Roles

• Formal matters include representing the company
• Organization relationships within and outside
• Leadership qualities are being authoritarian, a leader, a liaison, and leading work teams

Informative Role

• Information distribution for decision-making within and outside the organization
• Spreading relevant information
• Communicating company information externally and representing everyone.
• Oversees, diffuses, and acts as a spokesperson.

Decision Roles

• Secure profitability, seek new markets, and create new products.
• Takes action and solves problems
• Resource allocation
• Direct internal and external negotiations.
• Handles entrepreneurship, disruptions, resource allocation, and negotiations

Company Classification

• An organization or entity that generates goods or services for economic purposes.

Company Classification in Chile (Size/Magnitude)

• Micro-enterprise: 1-5 employees with annual sales between 0 and 2,400 UF.
• Small enterprise: 6-50 employees with annual sales between 2,401 and 25,000 UF.
• Medium enterprise: 50-400 employees with annual sales between 25,001 and 100,000 UF per year.
• Large enterprise: 400+ employees with annual sales exceeding 100,001 UF per year.

Company Classification in Chile (Activity)

• Industrial (Productive) companies extract or produce goods by transforming inputs into physically distinct products.
• Commercial companies purchase consumer/durable goods for later sale without altering the product's physical form.
• Service companies are dedicated to trading intangibles and/or providing services.
• Financial companies act as financial intermediaries and provide financial/business services.

Company Classification in Chile (Economic Sector)

• Primary sector: Dedicated to extracting natural resources
• Secondary sector: Transforming raw materials into finished products
• Tertiary sector: Involving commerce and services
• Quaternary sector: Related to information technology and communications.

Company Classification in Chile (Capital Origin)

• Public companies: Capital and administration belong to the state.
• Private companies: Capital and administration come from private individuals.
• Mixed companies: Capital and administration are shared between the state and private individuals.

Company Classification in Chile (Legal Structure)

• Individual Enterprise: Owned by one individual who benefits from gains and is responsible for losses, even at the expense of personal assets.
• Public Limited Company (S.A.): Legal entity formed by shareholders consolidating a common capital. The shareholders are anonymous. Managed by a board of directors with at least three members, who elect a president and manager. Decisions are made by majority vote, participation is determined by the number of shares held.
• Shares Company (SpA): A company that can be created by one person initially and add more participants later and gives flexibility for status changes and shareholders.
• Limited Liability Company (Ltda): Shareholders only liable to the extent of their contributions, 2-50 shareholders are allowed, and decisions are by mutual agreement.
• Individual Limited Liability Company (EIRL): Organized by one person, liability is limited to the company's assets.
• Commercial Collective Society: Characterized by unlimited liability for partners (even using personal assets). Managed by all partners, requires unanimous approval for adding or removing a partner.

Company Classification in Chile (Capital Scope)

• Family businesses: Participation, ownership, and management are closely linked to a family.
• Local companies: Operate within a municipality, city, or town
• Provincial companies: Operate in a specific province within a country.
• Regional companies: Operate in several provinces within a country.
• National companies: Operate nationwide
• Multinational companies: Operate in multiple countries
• International companies: Operate in other countries.

Company Classification in Chile (Destination of Benefits)

• For-profit companies: Aim to generate economic gains and maximize results for their owners.
• Non-profit companies: Focus on social welfare and any surplus is used for economic aid.

Company Objectives

• Company objectives are the goals that are set to be achieved over a period.

Common Objectives

• Being the market leader, increasing sales, raising income, generating more profits, and obtaining higher profitability. Also, achieving a larger market share and becoming a recognized brand.
• Increase the number of salesperson

Budget

• A financial plan that allows future sales projections considering variables such as experience, price fluctuations, and the business environment.
• Operational Budget: A financial plan complementary to the sales budget that shows all operating expenses in a period, production costs, and administration and sales expenses.

Qualitative and Quantitative Aspects of Budgets

• Qualitative: Stated in words.
• Quantitative: Expressed in quantity.
• Cost focuses on production.
• Expense focuses on the administrative.
• Investment is an outflow of money that provides a possible yield in the future and can be in assets or in cash

The Plan

• A document containing ideas to guide businesses from their current state to where they want to be in 3, 5, or 10 years.
• Strategic plan: To distinguish or make an entity out of the company.
• Operations that will serve customers with professionalism and excellence.
• Activities that will avoid spending too much no matter the cost
• Criteria to measure company growth include plans, budget, Mission and vision, values and principles, programming, strategies, Objectives and goals