Lesson 1
Understanding the Organization
of an Agribusiness
Next Generation/Common Core Standards Addressed
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CCSS.ELA Literacy.RST.9‐10.8 Assess the extent to which the reasoning
and evidence in a text support the author’s claim or a recommendation
for solving a scientific or technical problem.
CCSS.ELA Literacy. RST.11‐12.9 Synthesize information from a range of
sources (e.g., texts, experiments, simulations) into a coherent
understanding of a process, phenomenon, or concept, resolving
conflicting information when possible
Agriculture, Food and Natural Resource
Standards Addressed!
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CRP.01.02 Evaluate and consider the near-term and long-term
impacts of personal and professional decisions on employers
and community before taking action.
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CRP.01.02.02.a. Classify professional decisions by their near- and
long-term impact on employers and community (e.g., decisions
involving: financials, business goals, processes, customer
satisfaction, corporate image, etc.).
Bell Work - Student Objectives
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Define organizing, organization, and
organizational structure.
Identify the basic principles of good
business organization.
Identify the three functions of management
in a business.
Describe a business organizational chart.
Vocabulary
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Compensation
Conglomerate
organization
Finance
Horizontal
integration
Marketing
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Organization
Organizational
chart
Organizational
structure
Organizing
Resources
Vertical
integration
Interest Approach
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Bring two students to the front of the room.
Ask each of them which stack they’d like to refile.
Why? Explain
Ask students to consider what would happen if a
business were as unorganized as that stack of
units.
How much work would they get done?
Discuss the importance of an organized locker,
book bag, or desk.
Organizing
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One of the main components of
management.
Without it a business will have
difficulty carrying out its mission and
plans.
The Organizing Process
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Combining people and resources
to accomplish a business’s plans.
Five Main Concerns with
organizational structure
Division of labor
 Delegation of authority
 Departmentalization
 Span of control
 Coordination
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Organization
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A group of people working together to
accomplish specific goals
They may work in a formal structure,
such as a scheduled meeting
Or informally, such as before or after
work
Both of which are meant to
accomplish the same goals
What are the basic principles of a
good business organization?
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Resources must be available for
the business such as:
Facilities
 Labor
 Equipment
 Capital
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Efficient Business Operation
The manager is responsible for
motivating their employees to
work efficiently and use the
business’s resources wisely
 Employee compensation should
be equitable and provide
incentives for productivity
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Compensation
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Compensation is wages or
remuneration for work done.
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Satisfied employees will provide
better service than unhappy
employees
Functions of Management
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There are three functions of
management within any
agribusiness
Finance
 Operations
 Marketing
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Finance
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Finance is the management of all
fiscal transactions within a business.
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Fiscal operations include inventory
and credit policies that affect the
business’s capital requirements
Operations
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Operations refer to the
products or services a
business offers.
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The function of the
manager is to improve
operations by making
production more efficient.
Marketing
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Marketing includes the
distribution, pricing,
and advertising of
goods and services.
A successful business
manager is aware of
what the consumer
wants.
What is a business organizational
chart?
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Conceptual
presentation of the
areas of
responsibility and
channels of
communication
within a business.
Ways for a Business to be
Organized or Expanded
Federated or centralized
 Vertically or horizontally
integrated
 Conglomerate
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Federated and Centralized
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Federated and centralized
organizations both consist of a
company headquarters with
several local organizations.
Policies and specialized operations are
handled by the parent company.
Operating policies are handled by the
local organization.
Vertical Integration
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Method of business expansion.
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Performance of two or more steps
in the marketing function by one
business
Horizontal Integration
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May include many businesses,
each of which performs similar
marketing functions over a wide
area.
Conglomerate Organization
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Includes a number of unrelated
activities as a means of
entering a number of markets.
Review/Summary
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Define the following terms
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Organizing
Organization
Organizational structure
What are the basic principles of good
business organization?
What are the three functions of
management in a business?
Describe a business organizational chart.
The End!