BUSINESS ENTERPRISE SIMULATION large extent, the company’s performance

capacity, culture, and work attitudes.

(BES)
HUMAN RESOURCE MANAGEMENT Function:
- This function provides more options and more
Human Resource Management Trends choices for requesting units.
1. Internationalization - A competency-based screening process together
2. Data-Driven Approach with a compensation and benefits system that
aligns all comparable positions in the
“Management is the art of getting things done through organization will support this.
PEOPLE.” -Mary Parker Follet
ROUTING
Human Resource Philosophy:
• Who do I BRING IN? - This presumes a company’s assurance of
• Who do I TAKE OUT? opportunities for growth, and an individual’s
• Who do I KEEP IN? commitment to do a job excellently.
• Who do I DEVELOP? - It is a “partnership” where the risk for
• Who do I REWARD? responsibility and accountability is balanced with
the opportunities for career advancement and
Basic (5MS) development.
1. Mobilizing Function:
2. Measuring - This function provides the proper assignment
3. Mentoring and appropriate opportunities for new and
4. Motivating existing employees of the organization.
5. Mixing & Matching - A well-articulated career and succession plan that
identifies the vertical and horizontal possibilities
for advancement complements this.

MOTIVATING PEOPLE (People + Operational)

• Retaining
• Resonating
ROLE: HRM as Employee Champion
- Motivating People in Organizations, Increasing
Employees’ Productivity and Contribution to the
Organization
- Empowering and energizing people to create a
MOBILIZING PEOPLE (Systems + Operational) conducive work environment and licit “best
• Recruiting practices”
• Routing - Pleasure & Pain
ROLE: HR as an administrative expert - Preference for Abhorrence
- Linking HRM Systems with Administrative - Aspiration or Deprivation
Policies, Processes and Procedures that enhance
Quality and reduce costs. RETAINING
- Designs and administers HR systems, policies, Philosophy:
and procedures to manage the organization. - We must ensure that present employees are
- What is to be done? made effective, their potentials are identified and
- How will it be done? realized, and they must be developed into new
- Who will do it? and different conduits of enterprise
development.
RECRUITMENT Function:
Philosophy: - This function develops and keeps excellent
- People are the organization’s most critical and performers. A well-grounded program that
significant resource. They define the breadth “senses” or has a feel for employee satisfaction,
and depth of the organization’s knowledge, motivation, and organizational morale is critical
skills, and competencies and determine to a to this.
RESONATING positions to enhance meaning and challenge in
Philosophy: the workplace.
- There is a need for organizations to have - A well-designed trigger and alert system able to
preventive care – that is, for building a detect early signs of indifference or non-
systematic monitoring of the organizational conformity is essential.
climate, its culture, norms, and practice. Early
diagnosis – to rethink assumptions and effective MEASURING PEOPLE (Strategic + Systems)
action provides stability in the work environment. • Reviewing
Function: • Rewarding
- This function does two things: preventive care or ROLE: HRM as Strategic Partner in Strategy Execution
monitoring of the organizational climate, and - Human Resource Strategy aligned with Business
echoing the values, beliefs, and best practices of Strategy
the organization. - Strategic deployment of people to execute
- A proactive “realities” program (organizational strategy and achieve desired goals
climate survey) that understands the true - Potential
conditions of the work environment can - Participation
transform conflicts or encounters to relationships. - Performance

MENTORING PEOPLE (Strategic + People) REVIEWING

• Retooling Philosophy:
• Recycling - The Company must continually find innovative
ROLE: HRM as Change Agent for Continuous ways to value contribution and results. It must
Transformation be in constant search for creative means to
- Creating Corporate Culture to Attain Vision, measure human capital and knowledge resources.
Mission and Objectives Function:
- Strategic change management and the - This function finds innovative ways to measure
transformation of people to meet challenges. the contributions from employee performance
- Teaching including exemplary work achieved beyond the
- Coaching call of their present assignments.
- Advising
REWARDING
RETOOLING Philosophy:
Philosophy: - If a company is to obtain the needed
- It is the Company’s commitment to maximize the contributions, it must reward those who make
potential of its people and provide them the them.
required knowledge, skills, competencies, - The spirit of the company is made, in the last
attitudes, and values to attain those potentials. analysis, by the kind and quality of recognition it
Function: makes on people decisions. They affirm what an
- This function bridges the “gaps” in organization really believes in, really wants, and
competencies (knowledge, skills, and attitude) really stands for.
of new and existing employees. Function:
- It will focus on enhancing their capabilities to - This function creates “STARS” in the
execute their assigned strategies, programs, organization while accumulating reputation for
activities, and tasks so they can work efficiently performance and excellence inside and outside
and effectively to meet the desired outputs, the organization.
performance indicators, and outcomes. - An attractive incentives, compensation, and
recognition plan will increase the significance
RECYCLING and value of this.
Philosophy:
- Our Company faces a competitive market with Mixing & Matching
changing needs. We must have the flexibility to - In order to accomplish their assigned roles, teams
provide new offerings, open and close venues, must have the proper mix of individuals. The
and redeploy our workforce. correct mix will depend on the required team
Function: outputs and outcomes. Teams need different
- Provides flexibility to the organization by types of people. They need different types of
redeploying or reassigning employees to other people. They need good leaders and followers,
initiators and implementors, extroverts and SOCIOECONOMIC PLAN
introverts, visionaries and operators,
entrepreneurial trend-setters and cautious Socioeconomic
controllers. - Used to describe the differences between groups
of people relating to their social class and
financial situation (Cambridge definition)
- Refers to related economic factors.
- Business is a major driver of socio-economic
impact – and socioeconomic impact is a major
predictor of business success, especially in the
long term.

Why Measure Socioeconomic Impact?

1. Reduce Risks
2. Enhance our brand
3. Create new business opportunities

Obtain or maintain license to operate

Key stakeholders: communities and government
authorities

Measuring socio-economic impact can help companies

show communities, government authorities, and other
stakeholders, that their activities create net benefits for the
economies and societies in which they operate.

Mitigate the risk of negative publicity, protest, and

declining government support for current and future
operations.

• Are we fulfilling our commitments and the

expectations our stakeholders have of us?
• Is there a gap between our impacts and our
stakeholders’ perceptions?
• To what extent do our activities create social risk
or conflict?

Improve the business enabling environment

Key stakeholders: policymakers

Measuring socio-economic impact can help companies

shoe policymakers what and how they contribute to public
policy goals through profitable business activity.

• To what extent are our business activities

contributing to local, national, or international
public policy goals?
• What negative impacts should we be aware of?
• How are our business activities contributing?
 • What are the critical levers of impact (such as - Social impact is one of the three pillars of a
procurement, training, or consumption of our sustainable business, but it can be difficult to
products and services)? define and even more difficult to define and even
more difficult to track and measure.
Strengthen value chains - The proponents must state their plan on how to
Key stakeholders: internal, colleagues, suppliers, improve the lives of the people who live in their
distributors, retailers, customers, and external partners immediate community. They must also identify
such as NGOs and donors. how the business will create a better society.

Can help companies predict the loyalty, performance, Examples:

stability, and capacity for growth of suppliers,
distributors, and retail partners.

• Do our suppliers have what it takes to attract other

big customers, expand production capacity, and
achieve economies of scale?
• Can our retail partners afford to invest in added
shelf space and inventory?

Fuel product and service innovation

Key stakeholders: internal, colleagues, customers, value
chain partners, and external partners such as NGOs and
donors

Measuring socio-economic impact can help companies

understand the needs, aspirations, resources, and
incentives of their customers – enabling them to develop
winning new products and services and improve existing
offerings.

• How can we create demand for a product or

service we know would add value?
• Where do we need help from external
stakeholders – like governments, donors, and
civil society groups?

The Socio-Economic PLAN discusses in detail the

benefits to be derived from the business. It highlights the
contributions of the business. It highlights the
contributions of the business to the economy, society and
community where it will operate.

Socioeconomic Plan
• Social Implications
• Economic Implications
Economic Implications
Social Implications - It discusses the contributions of the business to
- This part identifies the social contributions of the general economy.
the proposed business. - It may include discussions about the effects of the
- It enumerates the ways by which the proposed proposed business on prices, local suppliers,
business is expected to contribute to the society taxes, social services and BUSINESS
and immediate community. competition.
- Have you considered where your coffee,
chocolate, clothing, or other products come from NOTE: It is always better to make sure that you
and the conditions under which they were QUANTIFY the benefits that will be contributed by the
produced? business. (e.g. How much taxes? How many jobs? Etc.)
FINANCIAL PLAN - Includes termination of existing projects, product
lines, or lines of business; repayment/retirement
A. Projected Financial Statement of outstanding debts; & any planned acquisitions
1. Income Statement
• Year 1 Short-Term Financial Plans
• Year 2 - The specific steps or actions that will ultimately
• Year 3 reach the company’s long-term goals
• Year 1 (Summary) - Include setting the sales forecast and other forms
• Year 2 (Summary) of operating and financial data
• Year 3 (Summary)
Long-Term Short-Term
(Interpretation per year) Planning Planning
- SUPPORTING SCHEDULES/NOTES Persons Involved More participation Top management is
2. Profitability and Liquidity Indexes from top still involved but
• Return on Investment management there is more
participation from
• Payback Period lower level
• Break Even Units managers
(Interpretation per Indexes Year 1, 2 & 3) (production,
marketing,
personnel, finance
The Financial Plan and plant facilities)
- The financial aspect of the Business Plan because their inputs
quantifies the result of Marketing Plan are crucial at this
(Advertising Budget & Creative Executions), stage since they are
Human Resource Plan and Operation Plan the ones who
implement these
aspects of the study and expresses in peso terms plans.
the possible outcome of operating the projects. It Time period 2 to 10 years 1 year or less
is important to note that all monetary figures in Level of Detail Less More
this aspect must be derived from the preceding Focus Direction of the Everyday
chapters of the study. company functioning of the
company

Financial Analysis
PLANNING AND CONTROLLING
Return on Investment
Budget – a plan which is expressed in a quantitative
ROI = Net Profit/Initial Investment x 100
monetary value
Payback Period
Budgeting Preparation
Payback = Total Investment/Annual Net Income
• Sales Budget
Break Even Units Formula • Production Budget
𝐹𝑖𝑥𝑒𝑑 𝐶𝑜𝑠𝑡𝑠 • Operating Budget
Break Even Units = 𝑆𝑃−𝑉𝐶 • Cash Budget
SP = Selling price per unit
VC = Variable cost per unit SALES BUDGET
- The most important account in the financial
Two Phases of Financial Planning statement in making a forecast is sales since most
• Long term financial plans of the expenses are correlated with sales
• Short term financial plans
Sales Forecast
Long-Term Financial Plan Data can be from
- A set of goals that lay out the overall direction of • Projected Market Share
the company • Historic Net Sales
- An integrated strategy that takes into account
various departments
- Considers proposed outlays for fixed assets.
Research and development activities, marketing
& product development actions, capital structure,
& major sources of financing
MARKET SHARE

Example:

HISTORIC NET SALES

Moving Average
- There are multiple formulas and methods of
forecasting using historic data of net sales but the
basic of all is the Moving Average

PRODUCTION BUDGET
Example: - Provides information regarding the number of
units that should be produced over a given
accounting period based on expected sales and
targeted level of ending inventories.

Required production in units = expected sales + target

ending inventories – beginning inventories
 Example 1: Company X forecasts sales in units for
January to May

• Company X would like to maintain 100 units in

its ending inventory at the end of each month
• Beginning inventory at the start of January
amounts to 50 units
How many units should Company X produce in order to
fulfill the expected sales of the company?

OPERATING BUDGET
- The variable and fixed costs needed to run the
operations of the company but are not directly
Example: attributable to the generation of sales
Two Components:
• Variable Cost – vary based on the operation of
the business, (can be by hours/rates, or energy
output).
• Fixed Cost – unchanged as production

Does the variable cost stick to the product?

Yes -> Cost of Goods Sold
No -> Operation Cost

Variable Fixed
Salaries of Labor Salaries of Admin
Utilities for Production Utilities for Admin
Rent with Rates (e.g. Fixed Rent (e.g.,
Server Rental of Warehouse Rental for
bandwidth space for Inventories and Supplies
online Data Storage) Storage)
Example: