A Level Business - 1.4 Managing People

Staff seen as an ASSET

Contribute to idea, help to achieve objectives, brings in new customers

Staff seen as a COST

Have to be paid wages, training cost, easily replaceable

Part-Time Pros & Cons

Pros: Aren’t as tired, Better work quality

Cons: Pay for more training, have to employ more workers

Temporary Pros & Cons

Pros: More people = more ideas, if not suitable then easily leave, no long term costs

Cons: Multiple training costs, Wasted potential

Multi Skilled Pros & Cons

Pros: Employ less workers, valuable asset, more motivated as there is range of jobs

Cons: Hard to replace, extra training costs

Homeworking Pros & Cons

Pros: no need for a premises, workers feel more motivated, less distraction

Cons: Hard for communication, Hard to monitor progress

Dismissal

Worker is fired due to gross misconduct. Not entitled to a pay-out.

Redundancy

Worker is let go due to role not existing anymore

Individual Bargaining

Negotiations between individual and employer, affects them only.

Collective Bargaining

Negotiations between union and employer. Affects those who are registered union members

Trade Unions

Organization that represents the interests of workers, aiming to improve working conditions and pay for employees.

Job Description

Responsibilities and expectations of the position

Person Specification

Qualities that the right person should have for the job

Short-listing

Candidates are removed or brought forward to next stage of recruitment based on how the application fits the job spec and desc.

Internal recruitment

Filling a job vacancy from within a business, by promoting someone or transferring someone to another role

External Recruitment

Filling a job vacancy with someone from outside the business with relevant qualifications

Advantages/Disadvantages of Internal recruitment

Advantages: Don’t have to pay extra salary, Already knows the people that will be applying

Disadvantages: May cause jealousy from applicants, disrupting work flow, Leaves a vacancy which must be filled

Advantages/Disadvantages of External Recruitment

Advantages: Brings in new ideas and experience, Allows growth of work force

Disadvantages: Applicant isn’t necessarily trust-worthy, Process is long and expensive

Training

Process that increases the knowledge and skills of a worker, enabling them to perform their role more effectively

Induction Training

Given to new workers. Familiarizes them with workplace, allowing them to be productive

Advantages/Disadvantages of Induction Training

Advantages: Worker feels comfortable in workplace

Disadvantages: Worker isn’t earning business money during the training

On the job training

Coaching given while doing job. Advice provided by those more experienced

Advantages/Disadvantages of On the Job training

Advantages: Learning while working, so they’ll remember it, Training is job-specific, Easy to organize.

Disadvantages: Worker may damage machinery, Trainers aren’t being productive, Bad practices passed on, new ideas aren’t brought in

Off the Job training

Courses/work given at training centers or at home, learning through talks/lectures, away from the job site

Matrix Structure

Structure in which people work in departments and collaborate to work in teams

Matrix Structure Pros and Cons

Pros: Ideal for projects, staff can move between departments, Use specific staffs’ skills.

Cons: Co-ordination problems between departments, Conflicts of interest

Centralisation

When headquarters make all or most of decisions

Centralization Pros & Cons

Pros: Stores are consistent across company. Appropriate when business is spread over large geographical area. Standards are met

Cons: Decisions may not apply to the customers of each branch.

Frederick Taylor

Scientific Management

Scientific Management

Improve efficiency by analyzing work, breaking into smaller steps, and standardizing methods for max productivity.

How to motivate

Piece-rate-pay, where workers are paid based on amount produced

Abraham Maslow

Hierarchy of Needs

Hierarchy of needs

People are motivated by a series of needs. Lower level needs must be satisfied before higher-level needs

Hierarchy of Needs in Descending Order

Self actualization, Esteem, Belonging, Safety, Physiological

Self Actualization

Achieving potential and personal growth

Esteem

Respect, recognition, status

Belonging

Being in work-related relationships and teams

Safety

Job security, safe working conditions

Physiological

Basic needs, wages, rest breaks, reasonable hours

Frederick Herzberg

Two-Factor Theory

Two-Factor Theory

States that job satisfaction is influenced by Motivators and Hygiene factors.

Hygiene Factors

Pay, working conditions, job security prevent dissatisfaction but don’t motivate

Motivators

Achievement, responsibility, promotion increase motivation and job satisfaction

Piecework

Payment based on number of units produced

Piecework Pros & Cons

Pros: Increases productivity, easy to calculate pay, links efforts directly to reward

Cons: Quality may fall as workers rush to max output, Health and safety risks, Requires strict quality control

Piecework Impact on Motivation

Strong financial motivation for those motivated by money, doesn’t meet higher level needs.

Commission

Bonus paid based on achieving a sales target

Commission Pros and Cons:

Pros: Incentive to increase sales, lower labor costs

Cons: Aggressive selling may damage client relationships, Income uncertainty, Higher staff turnover

Commission Impact on Motivation

Strong motivation, however can demotivate if sales are affected by other factors

Bonus

One-off financial reward paid to employees for meeting targets

Bonus Pros & Cons

Pros: Encourages effort, Flexible reward, Increases job satisfaction

Cons: Targets may be unrealistic, Can reduce teamwork, Perceived unfairness may demotivate staff

Bonus Impact on Motivation

Encourages short-term productivity, motivation may fall once bonus is paid

Profit-Sharing

Distributing a % of net profit across work force.

Profit Sharing Pros & Cons

Pros: Encourages loyalty, Improves productivity, Encourages teamwork.

Cons: Employees feel that individual effort has little impact on profits, Profits affected by external factors, Reduces motivation if profits are low

Leadership

Art of motivating a group of people to act towards achieving a common goal

Management

Planning, monitoring the use of resources to achieve aims set by the business

Leadership styles

Autocratic, Paternalistic, Democratic, Laissez-Faire

Autocratic

Leaders tell employees what needs done and how. No consultation

Autocratic Pros & Cons

Pros: Suitable for low skilled workers, Speeds up decision making

Cons: Low levels of motivation.

Paternalistic

Consults staff but ultimate decision is by the leaderP

Paternalistic Pros & Cons

Pros: Attention for worker welfare

Cons: Employees still can’t make decision

Democratic

Offers guidance to group members, allows input from group members

Democratic Pros & Cons

Pros: Develops team spirit

Cons: Long decision making time

Laissez-faire

Employees carry out activities and freely make decisions

Laissez-faire Pros & Cons

Pros: Gives workers autonomy

Cons: Lack of control