REMEMBER IT!

– Management is concerned with using the resources available as effectively as possible in order to achieve the objectives of the business.

– Delegation is one of the most important skills of management. It’s important that subordinates know what they need to do, how and for when.- Management is composed of three basic levels: senior, middle and supervisory.

– A number of large businesses try to delayer their organisation.

– Traditionally decision-making was very centralised with all the major decisions made by senior management.

– Decentralised decision-making is where responsibility is not restricted to the senior level but, instead, spread out to other departments.

– Matrix management in which is where employees from different apartments work together temporarily to reach a particular goal.

– Management by objectives is where each departmental manager sets their own objective based on the business’ objectives.

– Within business, fast and effective communication is vital for work delegation, feedback, and business control.

– Communication can be either formal or informal.

– Horizontal communication travels between co-workers at the same level.

– Vertical communication can travel top-down, so orders from superior to subordinate, or bottom-up, so feedback from subordinate to superior.

– There are a number of channels of communication a business can use.

– Appraisals are used for measuring how effective an employee is in their role.

– Systematic and regular appraisals are advantageous.

– There are different types of appraisal possible.

– A business can measure employee effectiveness in four main ways: labour turnover, absenteeism, labour productivity, and waste levels.

– Recruitment and selection take place when a business realises that they have a job vacancy to fill.

– Training is either on-the-job or off-the-job and should happen throughout an employee’s employment.

– There are a number of reasons why a contract of employment is terminated: redundancy, retirement, transfers, resignation or dismissal.

– If an employee feels they were dismissed unfairly then they can apply to have their case heard at an industrial tribunal.

– Over the past century, a number of schools of thought surrounding management styles have been developed. They include classical management, scientific management, human relations management, and neo-human relations management and contingency management.

– Motivation level and job satisfaction of a workforce depends heavily on management and leadership styles.

– For most businesses making sure their workforce is motivated is very important.

– Motivational theories can be split up into content theories and process theories.

– Expectancy theory states that a worker will carry out an activity if they think that by doing so they’ll reach their desired outcome.

– Equity theory states that a worker will only be motivated if their remuneration package is a reflection of their efforts and is fair in relation to other workers.

– The way a worker is paid can have a large effect on their motivation level.

– As well as using money to motivate a workforce, businesses can also apply a number of non-financial methods.

– If a business is finding that its workforce is suffering from a lack of motivation then there are a number of steps management should take.

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TEST IT!

1. Kerry has just started a new job as managing director for legal firm. The firm is well-established and decision-making is very centralised. Kerry is eager to decentralise this process.

a) Explain why decentralising the decision-making process would be beneficial.

b) She wants to discuss her idea with the rest of the managerial board. Give two points they could give in defence of the current centralised system.

2. An animal charity wants to recruit street fundraisers to raise money and awareness for a new campaign.

a) Describe each of the following steps involved with recruiting and selecting a new employee.

1. Advertising

2. Short-listing process

3. Interview process

b) The charity decides to opt for a group interview as opposed to separate interviews. Why would this be suitable for the post?

c) Five candidates are selected. They are given an initial week of training. They will also take part in training throughout their employment at the charity. Give two reasons why extended training is beneficial for an employee.

3. Studies have revealed that the motivation level of staff has a direct effect on productivity. One way in which a business can improve the level of motivation within its workforce is through the method used to pay its workers.

a) Explain how the following methods could improve workforce motivation:

1. commission

2. share ownership

2. piece-rate scheme

b) Non-financial methods have also been shown to motivate workforces. Describe three non-financial methods a business could use to improve motivation in its workforce.

c) The productivity of a car manufacturing factory has been suffering due to bad timekeeping and high labour turnover. Provide three steps management could take to improve motivation in its workforce.

ANSWERS

a) Answer should include:

• The employees feel empowered.
• Faster and more efficient business as opposed to a long, drawn out decision process.
• Increases moral and motivation amongst employees.
• Less bureaucratic and more flexible.

b) Answers could include:

• It has a tighter control over all operations.
• Employees are specialised at what they’re best at.
• More control is kept at the top.

Fewer mistakes are likely to be made the fewer people there are involved in the decision-making process.

2.

a)

• An advertisement is compiled and different forms of media can be used to get it out to the public. The advertisement will specify the business’ name and address, the job title, the job specification, the pay and fringe benefits, and the hours of work involved.
• Application forms, cover letters and Curriculum Vitae (CV) are returned to the business to be analysed and sorted. The most suitable candidates are then contacted and invited in for an interview.
• The interview consists of open-ended questions which gives the interviewee the chance to talk about their skills and experiences. The interviewer(s) talk notes. Once the interviewer has finished their questions the applicant should be allowed to ask any that they might have both about the position and the business. Before the applicant leaves the interviewer should inform them of when they’ll be told of the final decision.

b) The job requires confident, out-spoken individuals. These candidates would be clearly apparent in a group situation.

c) Answers include:

• It improves their employability.
• It makes them multi-skilled and flexible within different roles.
• It increases their job satisfaction and motivation levels.
• It increases their chance of being promoted to a higher position.

3.

a)

1. The employee gets a percentage of the value of the goods they manage to sell so they’ll be motivated to sell more.
2. Employees receive part of their pay as shares so they profit from the company becoming more profitable and, therefore, are motivated to work harder.
3. Pay is proportional to productivity as a worker is paid per unit produced so the more an employee produces the more money they receive.

b) Answers include:

• Delegation: this is when management gives a certain level of authority down the hierarchy.
• Empowerment: management gives their subordinates a certain degree of power and autonomy over their own work.
• Job enlargement: the number of tasks for a role are increased thereby providing employees with more skills for their job.
• Job enrichment: employees are given more responsibilities and chances to use their own initiative and creativity.
• Job rotation: in order to increase variety, employees get to carry out different tasks within their role.
• Quality circles: gives employees an opportunity to have a say in how the business should be run and the role of implementing and monitoring any changes.
• Team working: employees work together to create a product or provide a service. Each employee has their own role within the team, like in cell production.
• Work participation: employees are invited to be part of the decision-making process and asked for their ideas and opinions.
• Work council: a number of employees make up the work council. It holds regular meetings with the managers in which issues concerning processes and procedures are discussed.

c) Answers include:

• Cultivate a better corporate culture.
• Ensure that all pay levels are fair.
• Make the jobs more challenging.
• Involve lower levels of the organisation in the decision-making process.
• Make sure that recognition is given for good work and achievements.
• Make sure that the business contains a good communication flow.

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Some top tips!

1. Print out the Test It! Questions – it will allow you to replicate exam conditions and also allows you to give your eyes a rest from the computer screen whilst doing your crucial revision.
2. Make a copy of the Remember It! Section and put in a place that you often look at. i.e. front of a journal, next to a mirror, on a kitchen cupboard door, etc. That way you can do some cheeky A Level Business Studies revision whilst doing those things you have to do!