Basic Coop Management

1
MARICEL G. RUEDAS
CDS II
BASIC CO-OP
MANAGEMENT

“ A cooperative is an
• autonomous
• duly registered association of persons
• with common bond of interest
• who have voluntarily joined together to achieve
their social, economic, and cultural needs and
aspirations
• making equitable contributions to the capital
required
• patronizing their products and services and
• accepting a fair share of the risks and benefits of
the undertaking in accordance with universally
accepted cooperatives principles.”
3
RA9520 Chapter 1 Article 3

4
Unique and different from
other business enterprise?
Characteristics of a
Co-operative
• Common need, common
bond of interest
• Member’s commitment to
help each other, succeed
in coop enterprise
• Leadership values
• Service-oriented, people’s
welfare to make members
aware to save & be thrifty
• Self-reliant
• Member-owner
• Member-user
• One-member-one vote
• Returns given back to members
• Patronize the services
• Equal opportunity
• Lower interest, prices
• Help members, help
themselves
• render the greatest possible benefit
to its members—not to make the
largest possible profit

6
self-help
self-
responsibil
ity,
honesty
equity and
solidarity
social
responsibility
and caring
for others
OPENNESS
democracy

OPENNESS - Nobody’s perfect, and we won’t hide it
when we’re not
HONESTY - We have integrity about what we do
and the way we do it
SOCIAL RESPONSIBILITY - We encourage people
to be answerable for their own community and work
together to improve it
CARING FOR OTHERS - We regularly fund
charities and local community groups with the profits
of our businesses
7

DEMOCRACY - We give each member an equal
chance to run the business of the co-op
EQUALITY - No matter how much money a member
invests in his/her share account he/she is entitled to
just ONE vote
EQUITY - We carry our business in a way that is fair
and un-biased
SOLIDARITY - We share interests and common
purposes with our members & other co-ops
8

• Cooperatives are voluntary
organizations, open to all persons able
to use their services and willing to
accept the responsibilities of
membership, without gender, social,
racial, political or religious
discrimination.
10

Cooperatives are democratic organizations
controlled by their members, who actively
participate in setting their policies and making
decisions.
Men and women serving as elected representatives
are accountable to the membership.
In primary cooperatives members have equal
voting rights (one member, one vote).
11

Members contribute equitably to,
and democratically control the
capital of their cooperative. At
least part of that capital is
usually the common property of
the cooperative.
12

Cooperatives are autonomous, self-help
organizations controlled by their members.
If they enter into agreements with other
organizations, including the government,
or raise capital from external sources, they do
so on terms that ensure democratic control by
their members and maintain their cooperative
autonomy.
13

Cooperatives provide education and training for
their members, elected officers, manager, and
employees so they can contribute effectively to
its development and growth.
They inform the general public - particularly
young people and opinion leaders - about the
nature and benefits of cooperation
14

15
Cooperatives serve their members most
effectively and strengthen the
cooperative movement by working
together through
local, national,
regional and
international
structures.

16
cooperatives work for the sustainable
development of
Their communities
Through policies
Approved by
their members.

(a)Credit Cooperative
(b) Consumers Cooperative;
(c) Producers
(d) Marketing Cooperative
(e) Service Cooperative
(f) Multi-purpose Cooperative;
(h) Agrarian Reform Cooperative 19

(i) Cooperative Bank
(j) Dairy Cooperative
(k) Education Cooperative
(l) Electric Cooperative
(m) Financial Service Cooperative
(n) Fishermen Cooperative
(o) Health Services Cooperative 20

(p) Housing Cooperative
(r) Transport Cooperative
(s) Water Service Cooperative
(t) Workers Cooperative
(u) Agriculture Cooperative
(v) Other types of cooperatives as may
be determined by the Authority 21

22
Prepares
for and
facilitat
es the
conduct
of
election
Conducts the
financial,
management
audit
Composed of members entitled to
vote -
Supreme body where all
authorities emanate from
Plans
and
impleme
nts
educatio
n and
training
programs
Manages
the day-
to-day
operation
s
Sets the strategic
direction and
formulates policies
Management
Staff
Performs
specific
tasks/
functions
related to
the day-to-
day
operations
Fund and
Asset
Custodian
Records and
documents
/safeguard coop
documents
General Assembly
Audit
Committee
Con Med
Committ
ee
SecretaryTreasurer
Election
Committee
General
Manager
Board of Directors
Ethics
Committe
e
Education
&
Training
Com
Others:
Credit
Com
Shall facilitate
the amicable
settlement of
Intra-
cooperative
disputes and
disputes
among
members,
officers,
directors, and
committee
members
Shall
ensure that
the ethical
values and
standards
of the coop
are adhered
to.

ORGANIZATIONAL STRUCTUREORGANIZATIONAL STRUCTURE
Prepares for
and facilitates
the conduct of
election
Conducts the financial,
management audit
Composed of members entitled to vote -
Supreme body where all authorities
emanate from
Plans and
implements
education and
training
programs
Manages the
day-to-day
operations
Sets the strategic direction
and formulates policies
Management Staff
Performs specific
tasks/ functions
related to the day-
to-day operations
Fund and Asset
Custodian
Records and documents
/safeguard coop documents
General Assembly
Audit
Committee
Con Med
Committee
SecretaryTreasurer
Election
Committee
General
Manager
Board of
Directors
Ethics
Committee
Education &
Training Com
Others:
Credit Com
Shall facilitate the
amicable settlement
of Intra-cooperative
disputes and
disputes among
members, officers,
directors, and
committee members
Shall ensure that
the ethical values
and standards of
the coop are
adhered to.

 The highest policy-making body of the co-op.
 Voting in primary cooperatives is strictly
ONE - MEMBER, ONE – VOTE. No proxies allowed
except for representative assembly.
 Quorum shall consist of at least 25% of all the
members entitled to vote. However in case of co-
op banks, quorum shall be as provided in Article
99 of the Code; In electric coops, 5% of all
members entitled to vote unless otherwise
provided in the by-laws
COOPERATIVE DEVELOPMENT AUTHORITY
DAGUPAN EXTENSION OFFICE

 REGULAR ASSEMBLY MEETING
held annually by the general assembly on a date
fixed in the by-laws, or if not, on any date within 90
days after the close of each fiscal year.
Provided, that notice of regular meetings shall be
sent in writing, by posting or publication, or thru
other electronic means to all members of record.

 SPECIAL ASSEMBLY MEETING
whenever necessary, a special meeting of the
general assembly may be called at any time by a
majority vote of the board of directors or at least
10% of the total members with voting right in the
cases specified in the by-laws.
At least one week notice must be sent to all
members who are entitled to vote.

 Members of the Board of Directors
 General Manager
 Secretary
 Treasurer
 Members of the committees created by the GA
 Other positions as maybe provided in the
by-laws

BOARD OF DIRECTORS
 Composed of not less than five (5)
nor more than fifteen (15)
members elected by the general
assembly for a term fixed in the by-
laws but not exceeding a term of two (2)
years.

BOARD OF DIRECTORS
 The BOD are responsible for strategic
planning, direction-setting, policy-
formulation and by resolution, exercise
all powers of the cooperative that are not
reserved for the general assembly.

BOARD OF DIRECTORS
 Review the annual plan and budget and
recommend for the approval of the GA
 Evaluate the capability/qualification and
recommend for the approval of the GA the
engagement of the services of an External
Auditor
 Appoint and terminate based on just cause
the General Manager

BOARD OF DIRECTORS
 Formulate and review the vision, mission
and goals of the cooperative
 Establish performance evaluation system at
all levels
 Review and approve the organizational and
operational structures

 Represent the cooperative in any
agreement, contract, business dealings,
and in any other official business
transaction as may be authorized by the
BOD
 Ensure compliance with all administrative
and other requirements of regulatory
bodies
GENERAL MANAGER

GENERAL MANAGER
 Represent the cooperative in any
agreement, contract, business dealings,
and in any other official business
transaction as may be authorized by the
BOD
 Ensure compliance with all administrative
and other requirements of regulatory
bodies

The membership support the co-op by
Participating in the Capital build-up
programs
Depositing
Borrowing wisely
Paying obligations promptly
Participating in co-op activities
35

The coop has competent leaders in
terms of:
ATTITUDE- commitment,
honesty, integrity and the
sincere desire to make this
world a better place to live in
for everyone;
36

KNOWLEDGE - the necessary
knowledge to run the coop as a
business e.g. accounting,
human relations and a clear
idea of the coop VMG in order to
provide the direction and to
serve as model/example
38

39
SKILLS - communicating skills,
relationship skills, skills in
financial analysis that can
contribute to the coop;
2ND LINERS – development of
other leaders along the way

The coop has competent and diligent
staff with;
•The right and adequate training for the
job;
•Just and adequate compensation;
•Opportunities for advancement
42

The following systems are installed and
followed;
• Accounting system;
• Internal control system;
• Management Information System
The officers and members meet often (at
least once a month). The officers use a
problem solving approach whenever issues
and concerns are raised.
43

Set of Rules and Guidelines
That will Guide the Management
In Implementing the Coop’s
VMG, Plans and Programs
44

There is a continuing written
policies.
The policies are clear-cut, providing
a balance between the interests of
the members and the coop.
All concerned are properly
informed regarding these policies.
45

•Validate that policies of the cooperative
are updated and properly documented
•Reinforce that policies are communicated
and understood by all stakeholders
•Approved policies are organized and
codified in a Policy Manual
46

Characteristics of ‘modernized’ policy
• Strategic –looks ahead and contributes to long
term goals
• Outcome focused –aims to deliver desired
changes in the real world
• Inclusive –is fair & takes account of the
interests of all
• Robust –stands the test of time and works in
practice from the start
47

Why put policies in writing?
• Communication
· So members, leaders and employees can read &
understand them
• Continuity
· To provide for management continuity
• Education
· To educate people about the coop
· To train new leaders & employees
48

Why put policies in writing?
•Governance
· To maintain control and describe the method
and systems of management
•Compliance
· To comply with bylaws, laws and government
regulations
· To comply with best management practice
standards
49

The internal capital is more than
50% of the total capital. The coop is
able to give a reasonable return on
investment to its members, and is
able to pay the cost of borrowed
capital (both the principal and the
interest).
50

• There is a continuing education program.
• A program of pre-membership education
process to potential members
• An on-going information/ communication
process thru which the coop maintains the
support and cooperation of members, e.g.
ownership mtgs., newsletter, fora, etc.
51

The members are satisfied with the
services given by the co-op, the
coop officers additional services, at
least once during the last three
years.
52

 The planning process will set goals
and defining the actions necessary to
achieve those goals. To achieve that,
they will involve into three steps:
A) deciding which goals the
organization should pursue;
B)deciding what courses of action to
adopt to attain those goals; and
C)deciding how to allocate
organizational resources.

 1. Strategic Plan – long term plan (usually 5
years or more) that represents the major
activities and programs towards the coop’s
vision.
 Where are we now? (Our
Baseline)
 Where do we want to go? (Our Target)
 How do we get there? (Our
Strategy)

 2. Annual Plan and Budget – a yearly
description and identification of coop’s
activities and programs for the year including
its costs. It must be anchored on the strategic
plan.
57

 3. Monthly Workplans – detailed
activities, actions and strategies per Key Result
Area (KRA) done and evaluated monthly.
 4. Other Plans: Risk Management Plan,
Disaster Plan, Succession Plan, Gender
Equality Plan, etc.

 The organizing process will determine:
a) the tasks to be done;
b) who will do them; and
c) how those tasks will be managed
and coordinated.
At this stage managers establish the
structure of working relationships
between organization members that
best achieves organizational goals. It
involves grouping people into departments
according to the tasks they perform.

 Then the managers need to lay out lines of
authority and responsibility between
group and people. The outcome of the
process is an organizational
structure, the formal system of
reporting relationships.
 The various coop’s policies (credit and
collection, internal control,
membership policy manual, CBU
policies, etc.) are done and developed
further.

 Its the process of acquiring, deploying,
and retaining a workforce of sufficient
quantity and quality to create positive
impacts on the organization’s
effectiveness.
 Coops must have a Human Resource
Policy that includes policies from hiring
to firing/retiring.
 Putting people at the right position,
giving them the right salary and must
deliver the required output.

 The leading will manage the capacity the
members of work groups toward the
accomplishment of organizational goals.
The leaders determine direction, articulate a vision,
and energize employees so that they can play a part
in achieving goals. It requires a number of skill sets
including understanding individual or group
behavior dynamics, the ability to motivate
employees, be affective communicators, able
to envision future and share that vision and
3C’s Leadership Model.

 1. Challenge – present a challenge that will
test their knowledge, skills, egos and loyalty all
towards the benefit of the organization and
stakeholders.
 State a Challenging Vision, Demand the
Impossible, Ask Challenging Questions,
Create a Culture of Continuous
Improvement, Benchmark the Best and
Argue with Success

 2. Confidence - a major responsibility of a
manager is to build confidence and motivate
his or her employees so that they will believe
in their ability to reach their objectives.
 Expand People's Self-Image, Keep
Ownership Where It Belongs,
Empower Your People, Recognize
Good or Improved Performance and
Drive Out Fear

 3. Coaching is the process of advising
people in a way that facilitates their success. It
may take various forms, from training to
offering a broader perspective. Coaching
can help employees to better understand how
their efforts fit into the larger strategy, thereby
allowing them to make better decisions.

 Find the Right Balance, Make People
Think for Themselves, Show People
What Good Performance Looks Like, Be
a Facilitator and Give Feedback

 Marketing is a form of communication
between you and your customers with the
goal of selling your product or
service to them. Communicating
the value of your product or service
is a key aspect of marketing.

 The Five Ps of Marketing: Product,
Place, Promotion, Price, and
People.
 If you're pouring money into marketing but
nothing's happening, you need to evaluate your
marketing mix.

 Product. Your coop should solve an urgent
need or pain for the customer. Your product
needs the right features.
 Place. Location or place matters. Often coop
businesses pay for prime locations so they can
have the needed foot traffic. You want to be
located on a highly coveted corridor, in a
location that provides you easy access to the
target customer.

 Promotion. Without proper promotion to
attract your target customer, you won’t grow
your revenue. Good promotion starts with a
budget and marketing plan.
 Price. When pricing your product you must
know four things: your cost, what the
competition is charging, the standard mark-up
or profit margin in your industry, and the value
to the customer.

 People. Profile, needs, wants and
requirements of your members and members
to be. Is there a fit between what your member
wants to the products and services you have?
Are these people (members) willing to pay the
price?

 The last process of management is controlling.
It will monitor the performance of the
organization and the progress in
implementing strategic and operational
plans. They will identify the deviations
between planned actual actions. Then
taking corrective action, so that it will ensure
the organization is moving toward the
achievement of its goals. This involves
designing appropriate measurement and
information and control systems.

78
REPORTS
REQUIRED FOR
COOPERATIVE

79
The following reports shall be submitted to the
Authority:
1. Cooperative Annual Progress Report (CAPR)
2. Audited Financial Statement
3. Socio Audit Report
4. Performance Report
5. List of Officers and Trainings
undertaken/completed
REQUIRED REGULAR REPORTS

80
All registered cooperatives shall file with the
Authority a copy of the required reports either
through personal, registered mail, courier or
electronic means, within 120 days from the
end of every calendar year.
FILING

 They follow all business norms like:
 Compliance with all business requirements
such as but not limited to business
permits; registration with BIR; social
legislation and labor laws;
 Adherence to local laws;
 Healthy competition;
 Open trade;
82

 They follow all business norms like:
 Selling at market price
 Avoid destructive competition among
coops
 Adequate capitalization
 Adherence to business governance
83

 Constant expansion
 Quality Standardized Goods
 Minimize Expenditures
 Comply with basic requirements of
a business enterprise.
84

 Constant expansion
 Quality Standardized Goods
 Minimize Expenditures
 Comply with basic requirements of
a business enterprise.
85

1. BIR REGISTRATION
 Articles of Cooperation and By-laws
 Certificate of Registration from CDA
2. Tax Identification Number (TIN)
86

3. Book of Accounts
- yearly, on or before the last
working day of December
- 2 Columnar, Cash Receipt,
Cash Disbursement,
Ledger,Journal
87

4. Certificate of Tax Exemption
* Certified true copy of Articles of
Cooperation, By-laws and
Certificate of Registration
* Application Letter
* BIR Registration
* TIN of member or cedula
88

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