B120: mid term REVISION

Transcription

1 Book1 1-What is a business? B120: mid term REVISION -Business is hard to define for the very reason that there is so much of it around us, in all sorts of different shapes and sizes, but businesses havethree factors in common: people, objectives and structure. Some common characteristics of businesses: - They consist of a number of people. - They will have some income and costs. - They will need different types of resources to produce different types of goods and services. - They are likely to need to co-ordinate a number of different activities undertaken by individuals. Types of businesses: 1. The private sector: Private individuals and firms that are owned by private individuals (not controlled by the government). It include Private Companies (Ltd) and Partnerships 2- The public sector:made up of central government, and businesses that are owned by government (controlled and operated by the government). Public sector L o c a l a u t h o r i t i e s, s c h o o l s, governmental departments, armed forces Private sector Sole traders, partnerships, producer and consumer co-operatives Not for profit Voluntary organisations, clubs and societies, pressure groups, religious organisations For profit Railways, airlines, nationalised industries 2-What is the tool to analyise The external environment ( STEEP)? A business exists within an external environment consisting of the actions of other players who are outside the business. A Key Success Factor (KSF) for any type of business is an accurate understanding of the external environment can be defined and analysed using the STEEP model (STEEP is an acronym for Sociological, Technological, Economic, Environmental and Political factors).

2 STEEP stands of five factors: 1- Sociological factors: It include demographic changes in the age and structures of populations, patterns of work, gender roles, patterns of consumptions and ways in which culture of population or country changes and develops. 2- Technological factors: It include information technology (IT) for business management and information and communications technology (ICT) which influence on: Lowering the barriers of time and place. Creates new industries. Depends of many individual jobs and internal service functions on ICT systems. 3- Economic factors: It include economic growth, interest rates, inflation, energy prices, exchange rates and levels of employment. 4- Environmental factors: The impact of businesses activities on the natural environment (sustainability, recycling, emissions and waste disposal). Businesses need to consider a number of environmental factors (such as: legislations, environmental management systems 'ISO 14000', information about environmental audit and performance reports, employees, shareholders, pressure groups, and customers). 5- Political factors: It include legislations, trading relationships (such as: the World Trade Organization WTO and the European Union EU ),AND government. 3-Discuss the concept of Stakeholders? Stakeholders are groups of people who have an interest in a business. They can be seen as being either external (e.g. creditors, customers, suppliers, government, community), or internal (e.g. shareholders owners, managers, staff or employees). A stakeholders for - profit business: Stakeholders Primary Expectations Secondary Owners Financial return Capital growth

3 Employees Pay Work satisfaction, training, social integration Customers Supply of goods/services Quality Creditors Credit worthiness Security Suppliers Payment Long-term relationships Community Safety and security Contribution to the community Government Compliance Improved competitiveness 4-Discuss the concept of SWOT Analysis? Another important tool is the SWOT analysis as this helps managers to look at both the external circumstances, the possible Opportunities (O) and Threats (T) that the firm faces and the internal factors, Strengths (S) that the firm can build upon and Weaknesses (W), which the firm need to understand. -Strengths: - Positive tangible and intangible attributes, internal to an organization. They are within the organization s control. EX - good management. Weaknesses: - Factors that are within an organisation s control that detract from its ability to attain the core goal. Which areas might the organization improve? Ex bad training Opportunities: - External attractive factors that represent the reason for an organisation to exist and develop. What opportunities exist in the environment, which will propel the organisation? Ex new project. Threats: - External factors, beyond an organization s control, which could place the organization mission or operation at risk. The organization may benefit by having contingency plans to address them if they should occur. ex new competitor. 5-what is the structure? 1- A structure gives a business an identity and provides continuity. 2- A structure provides a framework for the allocation of roles and responsibilities.

4 Different types of structure: - A business might be structured in various ways: 1. By function: functional structures might work best when departments need regular communication with each other.ex : KDD 2. By product or service: can help to achieve better responsiveness to customer needs. EX: AL GHANAM GROUP 3. By geography: this type has advantages for large international business because there are likely to be differences between the markets it serves.ex PEPSI - There is no best model for structure. What are the advantages from it? 1- Enabling participation: - The structure of any business will determine how all the relevant sections and parties join in its activities and influence its decisions. 2- Providing a framework for the allocation of responsibilities and authority: - Structure is at the heart of the differentiation and integration of work. More simply, 3- Establishing an identity for the business: - Any business will need to allocate responsibilities for external contracts. For example, suppliers and customers need to be able to identify whom to contact within the business. 4- Continuity and change: - Many businesses deal with change and uncertainty. Structure can provide continuity. Without a structure, there is a tendency for people to constantly set up new systems and procedures in response to new situations. What are the disadvantages from it? - They can be difficult to change. This underlines the importance of seeing structure as dynamic, and not static. - is no 'one size fits all' model. - Any business should develop a structure that meets the requirements 6-what are the ( factors ) Dimensions of structures:

5 The main dimensions of business structure that may be helpful in identifying the type of structure within a business, and the reasons for it (Pugh and Hickson, 1968), as shown in the following table: Dimensions of structures Features Specialisation Standardisation Formalisation Centralisation Configuration The extent to which specialised tasks and roles are allocated to individuals who work in the business. The extent to which a business has standard procedures The extent to which rules, procedures, instructions and so on are written down, or formalized. The extent to which decision making and authority are located at the top of the hierarchical structure and/or at the centre of the business if there is more than one site. The shape of the role structure, whether the chain of command is short or long. 7-what is Definition of organisational culture?: Culture is a pattern of beliefs and expectations shared by the organisational members. These beliefs and expectations produce norms that powerfully shape the behaviour of individuals and groups within the organisation. 8-what is Dimensions of national culture (Hofstede, 1980)?: Hofstede classified a country's cultural attitudes as five dimensions: 1. Power Distance: A high power distance culture prefers hierarchical bureaucracies, strong leaders, a tendency for the centralization of power to make decisions, inequalities within society, and a high regard for authority. EX -PAKISTAN A low power distance culture tends to favor personal responsibility and autonomy.ex- DYNAMRK 2. Individualism versus Collectivism:

6 In an individual culture, free will is highly valued. In a collective culture, personal needs are less important than the group's needs. EX- USA Collectivism refers to the needs of groups are more important than the one needs. EX - CHINA 3. Masculinity versus Femininity:. -Amasculine cultureemphasises status derived from wages and position. EX KSA \ a feminine cultureemphasises human relations and quality of life. EX- FRANCE 4- Uncertainty Avoidance: - A high uncertainty culture allows individuals to cope better with risk and innovation. EX ITALY a low uncertainty cultureemphasises a higher level of standardisation and greater job security. EX TUNSIA 4. Confucian versus Dynamism:the degree to which a society does or does not value long-term commitments and respect for tradition. EX. DUBAI 9-What is the Business ethics? these ethics Deal with the right and wrong actions that arise in any work environment. Knowing right from wrong - doing right Doing the right thing Nature of ethics: Concern with what is right and wrong in: - Relationships; - Actions; - Beliefs; - Attitudes. The person is ethical because he is 1- Loyal; 2- Truthful; 3- Respectful; 4- Honest; 5- Dependable; 6- Have integrity. Business Ethics Sources: 1- Values; 2- National and international law; 3- Corporate citizenship. Business ethics important:- This is due to: 1. Business need to conform to the expectations of key stakeholders. 2. Business depends on society, so it must respond to the needs of society. 3. Business can only operate effectively if certain norms are respected. 4. Business exercises considerable power over the lives of people 5. Ethical behavior has an intrinsic value.

7 10-What are the responsibility of business? Four broad perspectives have been adopted towards the role, or the purpose, of business in society, as follows: 1- The responsibility of business is to build shareholder value: Business exist for the purpose of maximising the wealth of shareholders. 2- The responsibility of business is to build long-term shareholder value: Business need support the relationships with stakeholders groups (e.g. treat employees fairly 3- The responsibility of business is to respect the rights of a range of stakeholders (multi-stakeholder approach): Businesses have a responsibility to a wide range of stakeholders (such as employees; customers; suppliers; local communities; and shareholders). 4- The responsibility of business is to help to shape society: This perspective goes one stage further than perspective 3. It propose that businesses should be proactive in supporting good causes. 11-what are The benefits of small business? 1. The small and medium sized enterprise (SMEs) sector plays a major role in creating employment; 2. SMEs sector can offer specialised services to customers to that larger businesses may not regard as cost effective to provide. Small businesses often work as subcontractors on big projects being managed by larger companies. 3. SMEs are likely to have specialised knowledge of the local business environment and can tailor their products and services appropriately. 4. In contributing to the local infrastructure, SMEs assist in regional and local growth and rejuvenation. 5. Smaller businesses may be able to innovate in ways that larger ones would find difficult. They tend to be less bureaucratic and more flexible in their respond to customer demand. 12- how can the government Support for the small business start-up? Many countries have their support programs for small businesses. The goals of support to SMEs are: 1. Building an enterprise culture; 2. Encouraging a more dynamic start-up market;

8 3. Building the capability for small business growth; 4. Improving access to finance for small businesses; 5. Encouraging more enterprise in disadvantaged communities; 6. Improving small businesses' experience of government services; 7. Developing better regulation and policy. Book2 13- DISCUSS McGregor s (1960) Theory X and Theory Y? Theory X: Theory X offered by McGregor assumes that employees dislike work, are lazy, seek to avoid responsibility, and need to be closely controlled or coerced to achieve desired goals. It is a negative view about people. - Assumed that lower-order needs dominate. Theory Y: Theory Y assumes that employees are creative, seek responsibility, and can exercise self-direction. It is a positive view about people. - Assumed that higher-order needs dominated. 14- Maslow s Hierarchy of Needs Theory? - Identifies five levels of individual needs. - Assumes that some needs are more important than others and must be satisfied before the other needs can serve as motivators. Maslow s Need Hierarchy Theory There is a hierarchy of five needs physiology, safety, social, esteem and selfactualisation; as each need is substantially satisfied, the next need becomes dominant. 1. Physiological needs: Basic needs (like food; water; clothing& shelter) satisfied through wages; 2. Security needs: Basic protection from threats, such as safe working conditions, job security (secure environment); 3. Social needs: Desire to be accepted by others such as love; affection and belonging (Feeling welcomed, part of the group or organisation); 4. Esteem needs: Feeling your work is appreciated by others; Recognition from others (Awards, public recognition; Informal recognition, communicating that a job is well done);

9 ! 5. Self-actualisation needs: Achieving one s potential;desire to develop capabilities to fullest. Selfactualisationneeds Higher-order needs Maslow s Needs Hierarchy Esteem needs Social needs Safety needs Maslow s Theory and HRM: Many businesses have used Maslow s hierarchy when establishing their HRM policies. Meeting Maslow s needs through HRM policies: The needs Physiological Security (safety) Physiological needs Can be met through - Good working conditions - Attractive wage or salary - Private health insurance cover - Attractive pension provisions - Subsidised housing - Free or subsidised catering - Safe working conditions - No redundancy policy Lower-order need Social (relationship) - Company sports and social clubs - Office parties, barbeques, outings - Permission for informal activities - Encourage open communications

10 Esteem - Regular positive feedback - Prestige job titles - Photographs in company news sheet - Promotions Self-actualisation 15-WHAT ARE THE FactorS Affecting Job SatisfactionAND (motivation) at work? Factor Individual Social Cultural Organisational Environmental - Challenging job assignments - Discretion over core work activities Examples Age, education, ability and personality. - Promotion opportunities - Encouraging creativity Work relationships and the opportunity to interact with people at work (formally and informally). The beliefs, attitudes and values. The nature and size of the business, the types of management and supervisory styles, the working conditions, the type of technology used, business policies and procedures. Economic, social, technical and governmental influences. 16-WHAT IS Taylorism? Scientific management developed by Frederick Taylor early 1900s (1911). Systematically (five principles) determines how work, both manual and nonmanual, should be divided into its smallest elements in order to maximize labour productivity. a. Efficiency: achieved by increasing the outputs per worker. b. Standardisation: of job performance, achieved by dividing up work tasks into small and clearly specified sub-tasks. c. Discipline: achieved by establishing hierarchical authority (especially, a clear division between the responsibilities and tasks of workers and managers). Criticisms of Taylorism 1. It is a very naïve approach. 2. Taylorism represents a limited view of working.

11 3. His idea that there was one best way and that this approach would work in any business can create some bias. -17-WHAT ARE the selection methods? The process of choosing individuals with qualifications needed to fill jobs in an organization. Selection methods: the main methods of selecting employees for a business are: 1. Interview:the aim of the selection interview is to determine whether the candidate is interested in the job and competent to do it. It is a two - process, it is also a chance for the applicant to assess if he/she wants the job being offered. 2. Tests:tests can be used to measure aptitude, such as competence in literacy or numeracy, or personality (psychometric tests 'Aptitude tests,intelligence tests, and Personality tests'). 3. Assessment centre:this is a process, rather than a place, which uses a number of selection techniques, instruments and exercises in combination and designed to diagnose individuals development needs. An assessment centre evaluates a person s potential by observing his/her performance in simulated work situations. 18-what are Induction and socialisation? An induction program is usually short term and includes the more obvious and practical things that can be done to help a new person settle a job and business. Socialisation is more long term and less tangible, it is the process by which the individual b e c o m e s a m e m b e r o f a n organisational culturea n d t a k e s o n i t s v a l u e s a n d behaviors.organisationalsocialisationis the process through which a new organisational employee adapts from outsider to integrated and effective insider. It takes place whenever an employee crosses an organisational boundary, whether this is external (i.e. between organisations) or internal. The types of information and support that may be useful for a newcomer? information at: 1. Individual level: Personal contractual issues and personal support. This could include information on: hours of work and breaks; flexitime arrangements; salary and other benefits such as training and insurance. 2. Job/task level: A general idea of the work to be done and how the employee should make a start. This is likely to include knowledge of: health and safety; work procedures (e.g. use of telephones, data protection, equipment and resources available, including IT resources); standards and targets for performance.

12 3. Support at departmental level: The relationship of the employee s job to other jobs in the department and the jobs of people in other departments. This may include: meeting key contacts; defining internal customers; identifying where joint working is required; departmental objectives; departmental communications mechanisms. 4. Organizational level: Wider issues to do with the structure, objectives, and wider context of the business at a whole. This could include information on: policies, aims and core values; HRM policies such as discipline procedures, equal opportunities. 19-what are the steps ofassessing people at work? 1- Performance management: Performance management is the practice of actively using performance data to improve desired outcomes. It is a very important and integrated reform strategy whereby better results are obtained from the organisation, teams and individuals. 2- Assessing performance: The key to managing and developing staff performance is to have a clear idea of what the job holder needs to do to be effective. Clarification of what is required is also a central part of appraisal and induction, and the achievement of standards is often linked to rewards and promotion. 3- Setting standards: Performance Standards are objective and appropriate standards or guidelines standards, terms and conditions and meeting contract Quality of work Work output and timing Interpersonal behaviour and dealing with others - Hours of attendance. - Procedures (e.g. notification of sickness absence). - Adherence to rules of organization as set out in formal contract. - Standards of written work. - Appearance of finished items of work. - Acceptance error rate. - Quantity of finished items of work. - Production norms. - Deadliness and timescales for completion of work. - Standards of behaviour in relating to customers/clients - Appropriate behaviour in relation to other colleagues and management. 4- Performance appraisal: Performance appraisal is a systematic description of job relevant strengths and weaknesses within and between employees and groups.performance appraisal should accurately describe job performance behavior (not effectiveness). Performance appraisal is argued to have benefits for all parties, for the individual, for the manager and for the business 5- After assessment: development

13 - The term development describes any experience or process that extends people s skills or abilities. - Development is efforts to improve employees ability to handle a variety of assignments.