Board – Management Relationship

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Encoded: Rea ReyesOJT - CDA

Prepared for :ARD Josefina B. Bitonio

ESSENTIAL CONDITIONS FOR SUCCESS OF A COOP

Felt need Enlighten membership Responsible and knowledgeable Competent manager Board – Manager relationship

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BOARD – MANAGER RELATIONSHIP

Smooth and balanced relationship between the Board and General Manager is a very important factor essential for proper functioning and sustained progress in business operations. Even well established cooperatives were ruined or their progress suffered when this relationship came under strain or got estranged.

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ROLE AND FUNCTIONS

There should be clear and understanding of and respect for each other role, functions and authority.

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ROLE AND FUNCTIONS OF BOARD OF DIRECTORS

The following are some of the important roles and functions of the Board of Directors in a Coop.

1. to define the objectives of the coop.

2. to et out goals, strategy, work plans

Short-term planning

Long- term planning

3. to hire a General Manager to run the operations

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4. to establish operational policies

5. to mobilize and arrange funds and to

regulate and lay down policies for use of

funds.

6. to supervise and monitor operations and to

review performance

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7. To keep members well-uniformed

8. relationship with other coop and sister

organizations

9. to maintain good relations in the community

and with general public

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ROLE AND FUNCTIONS OF GENERAL MANAGER

1. To manage business operations

2. To implement Board policies and decisions

3. Reporting of progress to the Board

4. To look after assets or properties of the coop

5. Maintenance of books of accounts and records

6. Recruit of staff

7. Training of employees

8. To act as an adviser to the Board

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USUAL AREAS OF FRICTION

1. Interference in business operations

2. Recruitment of personnel

3. Matters pertaining to personnel

4. Seeking special favors/treatment

5. Assertion of Authority

6. Transgression or encroachment in each other’s area of authority

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CONDITIONS FOR SMOOTH AND BALANCED RELATIONSHIP

If it is desired to have a smooth and balanced relationship between Board and General Manager, both the parties have to sincerely work for it and respect the important of other’s role and functions. Here are a few suggestions for:

a. Individual Board Member

b. Board of Directors

c. General Manager

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POINTS OF A CAUTION FOR A BOARD OF MEMBER

1. Don’t interfere in the management of daily

business operations.2. Accept the competence of your manager and let

him manage the operations. The Board hired him because they believe he can deliver the goods. He is paid for his managerial skills.

3. No individual Board member has any special authority. The authority of the Board of Directors

is with the collective group of Board of Directors

impression or a meeting.

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POINTS OF A CAUTION FOR A BOARD OF MEMBER

4. If you want to seek any explanation from the

General Manager please do so in the Board

Meeting or through the President.

5. Don’t extend or promise your support or

encouragement to any employee of the coop.

6. Don’t ask for any special favor from the General

Manage or any employee of the coop.

7. Don’t give any direct orders or instructions o any

employee of the coop. You may suggestions to

the General Manager.

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POINTS OF A CAUTION FOR A BOARD OF DIRECTORS

1. Always consult your General Manager before

making decisions.2. You should treat the General Manager as an

Adviser and Consultant to the Board. You must listen to him/her carefully.

3. Your decision should be such as may facilitate the job of the General Manager in actual implementation. Board decisions should be very clear and definite to avoid misinterpretation.

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4. Give your attention to important matters, important aspects of business and carefully watch the achievement of main objectives and results of business operations. Don’t waste time over petty matters and don’t get lost in details.

5. Have regular meeting Board meetings and carefully examine operations and financial reports.

6. Don’t transgress in the area of authority of the General Manager, if and when he discuss his problems with you.

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7. Acknowledge good work and express your appreciation and encouragement when due.

8. Make an objective evaluation of performance of the General Manager at the end of each business year.

9. You should trust the integrity and intentions of the General Manager.

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POINTS OF A CAUTION FOR THE GENERAL MANAGER

1. He must show due respect the elected representatives and spokesmen of the membership.

2. He must always remember that he is an employee of the coop.

3. He must accept without any mental reservation, the righteousness of the cooperative system and significance of democratic management.

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4. He has a right to be heard but the final decision is

with the Board of Directors. Once a decision is made,

he must implement it sincerely .

5. He should make full, frank and frequent reports to

the Board about achievement progress and problems.

6. He must accept full responsibility for entire business

operations of the coop.

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7. He should delegate his authority, train and instruct his staff, property, extend fair and equal treatment to all employees; cultivate good team-spirit and give them inspiring leadership.

8. His relationship with the President of the Board should be open and business-like.

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9. He should not develop a sense of

acquisition of or deep personal attachment

with the coop.

10. He must never take interest or involve

himself in election of board members. He

must keep himself aloof from functions or

groupings in the Board of Directors.

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BALANCED RELATIONSHIP NECESSARY

If a General Manager is a dominant type and does not show due regards to Board, the membership will lose contract, interest and confidence in the management.

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BALANCED RELATIONSHIP NECESSARY

If the Board of Directors is vey aggressive and interferes in daily operations, a good and competent manager may find the working conditions difficult and leave the job. For sustained progress and growth, it is desirable that the relationship between the two should be smooth and balanced.

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FUNCTIONS

THE BOARD’S ROLE THE MANAGER’S ROLE

PLANNING What are our objectives and annual goals

What contribution do they expect me to make?

ORGANIZATION

What policies should we follow in order to attain our goals? What are the guidelines?

What methods, procedures and tools do they want me to use to carry out the policies? How do I make my contribution?

DIRECTING What caliber of Manager should we have to carry out our policy and achieve our goals? Is our management adequate?

What staff will I need to get the job done? How much should I delegate to staff? What are the priority areas?

COORDINATING

Ensuring that the place products, price and promotion are available and that all committees are functioning. Being cooperative but not doing or typing to do the manager’s job.

Seeing that all the people do all the jobs that need doing, not just those that see important. Helping the board without domination, as well as other committees.

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CONTROLLING Are the results adequate? Are we achieving our goals? Are proper policies adhered to?

What results, do they expect from me? What being done adequately where are improvements necessary?

REPRESENTATION

Reporting to the annual meeting. You are the representative of the membership. Know what a cooperative is all about.

You are the key representative of coop. Know what the coop plans to achieve.

IMAGE Support the manager. (If you cannot agree with objectives, policies, and results, try to change them. If not, resign. Don’t talk out of the cooperative)

Support the Board. (If you cannot agree with objectives, policies, and results, try to change them. If not, resign. Don’t talk out of the cooperative)

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WHY BOARD- MANAGEMENT BREAK DOWN

A frequent reason for a breakdown in relations between the Board of Directors and Management in a Cooperative is due to a lack of communication, failure to communicate or not to understand their role in the management process. These are present in almost all of the following:1. Lack of understanding by the Board and Manager

of the respective duties and functions of each. It is not enough that a General Manager idea exists- each must understand his own job and that of the other.

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2. Failure of the Manager to recommend and/or of the Board to establish and prove clear-out overall policies to serve as management guides.

3. Establishing overall policies or operational policies without consultation between Board and Management.

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4. Surrendering of the policy- making

function to management, thus

encouraging a one-man organization.

5.Failure of the manager to use the

maturity and experience of the Board

members in making important decisions.

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6. Failure of the Board, collectively and individually to focus on the really important affairs and results of the corrective action. It often happens that Board members focus on minor details that are interesting but not vital for the association’s general welfare.

7. Failure of the Board or the Manager to insist on regular periodic accountability of the organization’s status.

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8. Differences in objectives and values between directors and managers.

9. Extension of credit to Board members, manager, or employees.

10. Inadequate training and indoctrination of new directors.

11. Directors attempt to manage.12. Conflicts inherent in the directorate position.

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IDENTIFICATION OF DECISINS AREAS FOR THE BOARD AND THE

MANAGERBoard responsibility

1. Reports to the membership to which it is accountable.

2. Concerns itself with “ideas” decisions.3. Determines overall objectives (“the

what”)4. Establishes policies.

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IDENTIFICATION OF DECISINS AREAS FOR THE BOARD AND

THE MANAGER

Board responsibility

5. Coordinates policies.

6. Approve goals.

7. Decides about long-range plans, committing resources, facilities, finances and manpower

8. Plans for executive succession.

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IDENTIFICATION OF DECISINS AREAS FOR THE BOARD AND THE

MANAGER

Board responsibility

9. Decide about job responsibility, training and performance of directors.10.Sets up standards of performance for the manager.11.Decides on system of controls to evaluate

effectively key performance areas in the cooperatives.12.Lets the manager grow; gives the manager time to manage.

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MANAGER’s RESPONSIBILITY

13.Reports to the board to which he or she is accountable.

14.Makes action decisions to carry out ideas.

15.Decides on carrying out objectives (“ the how and when”) of the achievement of objectives.

16.Carries out policies under authority under authority granted by the board.

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17.Coordinates personnel to execute policies.

18.Proposes goals in terms of specific quantity and time for achievement.

19.Decides on intermediate and short-term commitment of resources and the organization and control of these resources.

20.Plans for depth of management and managerial succession in departments.

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Decides about job responsibilities, training and performance of employed personnel.

Sets standards of performance for personnel through executives.

Operates under system of controls to furnish board with facts for effective.

Lets people under him or her grow delegates responsibility and takes time to manage.

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Functions

Sets the society’s objectives; decidesby-laws; exercises ownership controlover the society’s growth.

Interprets objectives in specific details;formulates specific policies to achieveobjectives; studies managementreports and evaluates progress; provides leadership to management and membership; approves salary ranges for jobs at all levels.

As chairperson of the board and ex official member of all committees, provides the link between board and management .

Manages the business in line with board policies; establishes operating procedures; sets out jobs to be done; engages supervises and trains staff; fixes salaries within ranges established by the board.

Manages the department; provides specialized technical know-how for the department; supervises and trains staff; enforces operating procedures for the department.

Provides services to the cooperative in line with established policies and operating practices.

Responsibilities

Uses the services of the cooperative; elects capable directors; provides capital for operation and expansion; studies board’s and auditor’s reports.

Elects president and appoints manager; is responsible to membership for results of operation; operates within the by-laws of the society and abides by its ownpolicies.

Has the responsibility of enforcing board policies and providing guidance to the general manager between board meetings; is responsible to the board for all actions.

Responsible to the president between board meetings; reports to theBoard at meetings; provides factual information so that the board can make policy decisions.

Responsible to the general manager fordepartment operations.

Responsible to the manager of thedepartment; has to acquireunderstanding of the society and technical know-how in the department .

General body

Membership elects

Board of directors

President

Appointments

General manager

Manager of department

Manager of department

Staff Staff 35

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Business

Board – Management Relationship