Business Studies Revision
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Business Studies revision notes
People and operations management
Management structure and organisation
An organisational structure is the way the organisation is put together in terms of personnel and positions. Its either:
Centralised: Flat structures are normally used which is a single level of management and it has its team.
Decentralised: Hierarchical structure is used which looks like a pyramid. It had many levels.
With levels of hierarchy (levels of authority) there are more consequences:
Wider span of control
Lacks flexibility
Message overload
Lack of promotion
“Them and us” culture.
A Matrix Structure has 2 people the employee has to report to, in other words 2 bosses.
Management by Objectives is a system that individuals are given objectives to make sure they are working towards the overall corporate objectives.
Motivation
Motivation is a method or a way to get an employee to do their job and enjoy their job.
There were 4 men who came up with motivation theories:
F.W Taylor:
His ideas became known as scientific management.
He said managers should assess their employees and cut out any unnecessary movement or tasks.
He said that managers should train their employees with the right skills needed for the job.
If workers didnt work effectively then they should be punished
Workers that worked well should be rewarded financially.
He believed money motivated people.
Also introduced the piece rate system where you get paid for everything you produce.
But this theory treats workers as machines and suggests money is the only motivator.
Elton Mayo:
Believed in teamwork and rest breaks
Said members of a group motivated each other to work
Said that workers were motivated by managers taking an interest personally to them.
Getting workers more involved in main decisions was motivating.
But workers will not always share the goals of managers and his findings were based on unscientific experiments on small groups of workers.
Abraham Maslow:
Believed that all humans had the same type of needs, which he put into a hierarchy.
Psychological needs were the first stage, which involved things like food, water, air etc. A business could motivate by giving decent pay with good working hours and conditions.
Safety needs was the 2nd, which was to do with freedom from anxiety and being free from danger. A business would need a high standard of health and safety.
Love and belonging was 3rd, which was about being part of a group and friendship. A business could provide social clubs outside work and regularly introduce teamwork.
Esteem needs was 4th, which was about gaining respect of yourself and others. A business could reward for achievement and give a promotion.
Self-actualisation was 5th, which was about achieving your full potential. A business would do training exercises to develop skills of the employee.
He says financial rewards alone wont motivate.
But not everyone is the same to be put into the hierarchy as some people may aspire to make lots of money as the last need rather than the first. Not all workers would want to be in one stage of the hierarchy.
Frederick Herzberg:
Said there were 2 theories of motivation. Motivators and hygiene factors.
Motivators improved job satisfaction with things such as promotion, responsibility, and a sense of achievement.
Hygiene factors are to do with the working environment with things such as working conditions, relationships with colleagues and security.
He said that to motivate the hygiene factors all need to be met and then the motivators.
But research has failed to confirm that this theory can be applied to every business and that some jobs may not be as easily Ðenriched.
Human resources management
Human resource management regards people as an important resource of the organisation, which needs to be managed effectively.
People add value to the organisation by:
Increasing productivity
Improving quality
Innovating
Improving customer service
People can differentiate one organisation from another and are an important source of competitive advantage. HRM aims to enhance the contribution of individuals and groups towards the organisational objectives now and in the future. This involves:
Attracting the right numbers of employees with the right skills and attitudes
Developing individuals to meet the challenges of their jobs now and in the future
Providing a safe and healthy environment in which to work
Enabling employees to contribute to the organisation
Developing