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LECTURE 2: BUSINESS & GOVERNANCE OF GOVERNMENT Presented by: Marc Ellouie T, Samonte, MBA, LPT AGENDA Students able to understand the Business aspect Cite some components ,forms, types of Business Role of Government/Governance in Business Ope...

LECTURE 2: BUSINESS & GOVERNANCE OF GOVERNMENT Presented by: Marc Ellouie T, Samonte, MBA, LPT AGENDA Students able to understand the Business aspect Cite some components ,forms, types of Business Role of Government/Governance in Business Operations 3 BACC 501 “Every man, by nature, has an impulse toward a partnership with others”..Aristotle BACC 501 4 5 M'S OF BUSINESS IN GOVERNANCE (REQUIREMENTS IN BUSINESS) 1. Money The foundation of the business management process starts with money. The basic need of any business is capital, without which the functioning of a business becomes difficult. A company needs money to produce goods or offer services. It is necessary for acquiring raw materials, hiring personnel, purchasing machinery, and incurring many other costs that a business faces. 2. Manpower The art of getting people to get things done is how management is BACC 501 sometimes described. Any organization needs labor because, without it, all other resources would be rendered useless. This group includes both managers and non-managers who work for the organization. Any 5 organization's business management success depends on having 3. Material The materials needed to create the ultimate product that the company sells can be raw or even semi-finished goods. Any production process's fundamental building blocks are its raw materials. The management must make sure that there is enough quantity and quality to satisfy the demand. 4. Machines Investing in contemporary machinery enhances the manufacturing process. The production process greatly benefits from the new technology in machines. Fast output is a result of well-running machinery, which can provide one with a competitive edge. Hence, this is another important M of business management 5. Methods BACC 501 Methods are the usual and recommended ways of carrying out certain operations in accordance with established systems and business management procedures. The effective management of operations is 6 Reason for engaging into Business Financial Independence Flexibility Lack of employment opportunities Job security Creating change Pursuing passions BACC 501 Personal fulfillment Expanding your network 7 Features of Economic System model & Market Model Economic systems regulate the factors of PRODUCTION, INCLUDING LAND, CAPITAL, LABOR, & PHYSICAL RESOURCES. An economic system encompasses many institutions, agencies, entities, decision-making processes, and patterns of consumption that comprise the economic structure of a given community. 8  CAPITALISM Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price systems, private property, property rights recognition, self-interest, economic freedom, meritocracy, work ethic, consumer sovereignty, profit motive, entrepreneurship, commodification, voluntary exchange, wage labor, sustenance and the production of commodities 9 CAPITALISM 10  SOCIALISM A political and economic theory of social organization which advocates privatization that the means of production, distribution, and exchange should be owned or regulated by the community as a whole. private ownership 11 SOCIALISM 12 MARKET MODEL 13 PERFECT COMPETITION Perfect competition occurs when there is a large number of small companies competing against each other. They sell similar products (homogeneous), lack price influence over the commodities, and are free to enter or exit the market Characteristics: No incentive for innovation There are very few barriers to entry 14  MONOPOLISTIC COMPETITION refers to an imperfectly competitive market with the traits of both the monopoly and competitive market. Sellers compete among themselves and can differentiate their goods in terms of quality and branding to look different. In this type of competition, sellers consider the price charged by their competitors and ignore the impact of their own prices on their competition. Characteristics: Non competitive price 15  PURE MONOPOLY A market structure characterized by a single seller, selling a unique product in the market. In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute. Characteristics: It dictates the price Entry of new firm is fast and easy 16  OLIGOPOLY An oligopoly is when a few companies exert significant control over a given market. Together, these companies may control prices by colluding with each other, ultimately providing uncompetitive prices in the market. Characteristics: Strong competition Requires huge capital 17 ROLE OF GOVERNMENT/GOVERNANCE IN BUSINESS OPERATION 18  PROMOTING ECONOMIC EFFICIENCY & GROWTH This can be achieved in various ways, such as by adopting more efficient production technologies, reducing unnecessary inputs, improving management practices, or better utilizing existing resources. STRENGTHEN THE INSTITUTION Institutional strengthening is about increasing the capacity or ability of institutions to perform their functions. There is a particular focus on improving governance FAIR DISTRIBUTION OF INCOME THROUGH TAXATION Equitable distribution of income means that income is distributed in a way that ensures fairness and allows everyone to have the same opportunities. GENEROUS SOCIAL SECURITY SYSTEM & EGALITARIAN SOCIETY An egalitarian social welfare function is indifferent to the level of utility, as long as it is equal for everyone. 19  5 MAJOR AREAS OF GOVERNMENT REGULATION OF BUSINESS ENTERPRISE 1. OCCUPATIONAL SAFETY AND HEALTH Occupational safety and health or occupational health and safety is a multidisciplinary field concerned with the safety, health, and welfare of people at work. OSH is related to the fields of occupational medicine and occupational hygiene and aligns with workplace health promotion initiatives 20 2. FAIR LABOR PRACTICES The Labor Code of the Philippines 2024 requires employers to pay a minimum wage for workers, which varies across regions to account for the differential cost of living. Employers must comply with the Philippines minimum wage rates, ensuring that employees receive fair compensation for their labor 21 3. CONSUMER PROTECTION Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace. Consumer protection measures are often established by law 22 4. ENVIRONMENTAL PROTECTIONS & CONCERNS The conservation movement lobbies for protection of endangered species and protection of any ecologically valuable natural areas, genetically modified foods and global warming. 23 4. ECONOMIC SECURITY Economic security or financial security is the condition of having stable income or other resources to support a standard of living now and in the foreseeable future. It includes: probable continued solvency. predictability of the future cash flow of a person or other economic entity, such as a country. 24  MEDIUM TERM PHILIPPINE DEVELOPMENT PLAN (MTDP) for 1993-1998 the Medium-Term Philippine Development Plan (MTPDP) for 1993-1998 was drawn up to achieve full industrialization by the year 2000. The blueprint of development as spelled out in this MTPDP is committed to the improvement of the quality of life of the people (NEDA, 1993). 25  MEDIUM TERM PHILIPPINE DEVELOPMENT PLAN (MTDP) for 1993-1998 DEVOLUTION the transfer or delegation of power to a lower level, especially by central government to local or regional administration. 26  MEDIUM TERM PHILIPPINE DEVELOPMENT PLAN (MTDP) for 1993-1998 DEREGULATION Deregulation is the process of removing or reducing state regulations, typically in the economic sphere. It is the repeal of governmental regulation of the economy. 27  MEDIUM TERM PHILIPPINE DEVELOPMENT PLAN (MTDP) for 1993-1998 DECENTRALIZATION Decentralization or decentralization is the process by which the activities of an organization, particularly those regarding planning and decision-making, are distributed or delegated away from a central, authoritative location or group and given to smaller factions within it. 28  GROWTH SUMMARY OF MTDP 1. COMMITMENT TO “MARKET” 2. GIVING PEOPLE A STAKE OF DEVELOPMENT 3. INDUSTRIALIZING THE AGRICULTURAL SECTOR 4. DEVELOPING EDUCATED CITIZENS AND WORKFORCE 5. BUILDING INFRASTRUCTURE 6. FOSTERING EXPORT INDUSTRIES 29 THANK YOU METS [email protected] BACC 501 30