Chapter 2 - intro to business PDF

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Chapter 2 Chapter 2.1 Leader

Manager

Management

Functions of management 1.Planning Set and implement short term objectives that will drive the business towards its long term targets. -

Outline the tactical strategies needed to achieve an overall business objective.

2.Organising Decide what resources needed to achieve its business objectives. -

It is the role of the manager to organize and allocate the resources of its business in the most efficient way possible. Managers should make sure that maximum outputs are gained from minimum inputs.

3.Commanding Employees will need to be given a clear direction about what they are expected to do so that the business is able to achieve its objectives. 4.Co-ordinating. Without someone to guide and guide the overall activities of a business, there is danger that some activities might be duplicated by different employees or departments. It is also important that all departments are working towards the same goal. -

The chance of a successful launch is reduced if the market is unaware of the new product. Also, the business will have to bear the cost of storing the products until the marketing campaign is ready.

5.Controlling and Monitoring The managers must ensure that the business is on course to meet its objectives, therefore it is necessary to check progress and the extent to which targets are being met. The progress of the employees is judged against various targets.

Mintzberg 1. Impersonal 2. Informational 3. Decisional

Leadership

Who are classed as leaders in a business 1.Directors = a senior management elected to represent shareholders 2.Supervisor = an employee overseeing the work of others 3.Employee representative = an employee who presents the view of the workforce to senior management

Leadership Styles

1. Autocratic Leadership

2. Democratic Leadership When business leaders consider the views of those working at various levels within the organization. Such leaders often do not trust their employees to make decisions about their own work to contribute to business decisions.

3. Laissez-fair Leadership

Douglass McGregor Theory X and Y

Theory X = distrusts staff and is likely to be an autocratic manager, controlling and supervisory Theory Y = trusts employees and is likely to be democratic or laissez-fair, values workers’ input and opinions

Daniel Goleman: Emotional intelligence

Chapter 2.2 Motivation = is a tool used by leaders and managers to encourage their employees to work willingly as hard as they can

Human Needs Human needs = a set of requirements that can include wants (desires) that have to be met to satisfy the basic requirements of people

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Motivation Theories

(1) Maslow’s – Hierarchy of needs

Basic needs – in other words are basic of human needs and such needs can be met by having the money to buy what is needed, Maslow believed that the other needs in the pyramid were irrelevant to a person who was struggling to satisfy these essential physical requirements. Safety Needs – They will look for some security that they will be able to meet those needs in the future, this can be satisfied by having a contract to work, providing job security at least in the short term. Social needs – most people enjoy contact with others whether at work or in their social lives, people benefit from some level of social interaction in their workplace. It allows those who work together to get to know each other better beyond their working relationship

Esteem needs – recognize that people need the approval and respect of others, these can be met in the workplace by employees being given a positive feedback from their managers. Esteem needs can also be satisfied by coworkers showing appreciation for their work of colleges. Self-Actualization – means the opportunity for an individual to be able to fulfill their own potential within a workplace, this means that people need to be able to develop their skills therefore will need to able to progress beyond their current level of skill and responsibility, this means can be achieved by having training and staff development opportunities available and internal promotion.

(2) Taylor’s economic man Taylors theory of motivation focuses on control and rewards, Taylor believed that employees required financial motivators in order to meet organizational objectives. Financial Motivators = monetary rewards or incentive given to employees

(3) Elton Mayo – Hawthorne experiment Mayo’s theory is based on Taylor and Maslow’s theory, He started with Taylor’s theory and swiftly developed it to take into account non – financial motivators, namely team work and esteem needs

He believed that the productivity of employees would be influenced by their work conditions as well as skills that they be influenced by their work conditions as well as the skills that they possessed. His conclusion was that these employees had increased their productivity due to being part of a team and that the very act of observing them had led them feeling that someone was taking interest in them. Non-Financial rewards = a method of motivation which takes into an account non-monetary method, such as the social and esteem needs of Maslow’s pyramids

(4) Frederick Herzberg – Two factor theory

Hygiene Factors = Aspects of work that do not motivate but, if not resent, cause dissatisfaction.

Job rotation = to vary the tasks undertaken, i.e. a group of employees have their tasks changed by managers on a regular basis to prevent boredom. Job enlargement = to give additional tasks to employees thus burdening their skills and experience

(5) Douglas McClelland – Motivational needs theory 1. Achievement – the need to meet given goals and objectives. 2. Authority – the need to have the power or influence over the actions of others. 3. Affiliation – the need to be liked and to work in supportive environment.

(6) Victor vroom and expectance theory

Motivation In practice Financial Rewards a. Piece rate payments  Made per unit or batch of units produced.  Produce as much as output possible but it does not necessarily mean that quality standards will be maintained.  Focus on quantity rather than quality.

b. Salary  Is an agreed paid monthly.  Gives employees some level of security regarding the amount they receive every month. -Time based payments = payments based on the number of hours worked, its an incentive to attend the workplace but does not guarantee the amount of work that will be completed during that time -Performance related pay

c. Profit sharing agreements.  If employees are to receive a share in the profits of the business, then they should be working towards the same end goal as the managers and the owners of the business. d. Commission  Payment made according to the number of sales achieved.  The method will inspire employees to achieve the highest possible level of sales, but, the danger with this is that the pursuit of the sales might lead to the priority being to make sure that the sales takes place rather than to ensure that the product or service is the most appropriate one for customer.

e. Financial Fringe benefits  Is defined as the benefits or perks given to an employee which have a financial benefit to them.

Non-Financial Rewards a. Team working Team working = groups of employees working together towards a shared goal -

The use of team working, and cell production will draw the employees together to pursue a common goal: the production of more products of high quality This group cohesion also meets some of the social needs because there will be constant interaction between the members of each cell The use of teamwork including the desire of wanting to be trusted and to be given responsibility such as teams are also often expected to suggest ways in which their work pattern or method could be improved, this shows that their knowledge and abilities are being recognized.

b. Status rewards or recognition of achievement or effort - Giving an employee a recognized status in a business can be a strong motivator, this can be achieved by giving extra responsibility to an employee that to some extent raises their status in the eyes of other employees.

c. Promotion Opportunities - Achievement can also be rewarded by giving a promotion to those who meet, and perhaps exceed, expectations in their performance. - One drawback to promotion is that there are limited number of promoted posts available in any business. d. Job design or redesign - Job redesign involves changing the tasks involved in a particular role within a business to make the job more challenging and interesting for the employee. - It might be that the work is not challenging enough to motivate people or that actual tasks are very monotonous and therefore the employee becomes bored - This can be costly to a business because a bored employee is likely to lose concentration and make mistakes. - Job redesign can be redesigned by using job rotation, job enrichment or job enlargement.

e. Empowerment Empowerment = the giving of power to employees so that they can make some of the decisions relating to there area of business activity -

Gives the employees the feeling of importance and of being valued and trusted by their managers, this is a form of delegation.

f. Employee participation

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Employee participation might result that the employees might have a better solution to a problem than their managers. By involving employees in this way, they feel valued and appreciated and are likely to work harder for the business.

g. Non-financial fringe benefits - Some fringe benefits do not offer a financial benefit to employees. - Ex : good performance can be rewarded with extra holidays or for higher businesses, perhaps they can be given a designated parking space at work - This can motivate the employees by making the employees feel valued.

How can employee participation be received?...