AS business topic 2 CAIE

Human Resource Management

the role and purpose of HRM

HRM stands for human resource management which is the strategic approach to the effective management of employees so that they help the business gain a competitive advantage

It focuses on

workforce planning to plan how many employees, and what skills are needed for the business in the future

recruitment and selection of appropriate new employees

preparing employment contracts for all employees

taking responsibility for management and workforce relations

monitoring and improving employee morale and welfare

introducing and managing payment and other incentive systems

measuring and monitoring employee performance

reasons for and role of a workforce plan

HR departments need to calculate the future employment needs of the business, failure to do this can lead to too few workers with the right skills or too many workers with the wrong skills

workforce planning is forecasting the numbers of workers and the skills that will be required by the organisation to achieve its objectives

the first stage of workforce planning is to do a workforce audit which is a check on the skills and qualifications of all existing workers/managers

numbers of employees required

the number of employees that a business requires in the future will depend on many factors:

forecast demand for the product

the productivity level

the objectives of the business

changes in the law regarding workers rights

the labour turnover and absenteeism rate

the skills of workers required

the need for better-qualified workers or for workers with different skills should be included in the workforce plan, the skill levels required will depend on:

the pace of technological change in the industry

the need for flexible or multi skilled workers as business try to avoid excessive specialisation

labour turnover

labour turnover measures the rate at which employees are leaving an organisation and is measured by the formula

number of employees leaving in one year / average number of people employed x 100

costs and benefits of high labour turnover

costs

costs of recruiting, selecting, and training new staff

poor output levels and customer service due to vacancies before new recruits are appointed

difficult to establish customer loyalty due to a lack of regular contact

difficult to establish team spirit

benefits

low-skilled and less productive staff might be leaving and could be replaced with more carefully selected workers

new ideas and practices brought into an organisation by new workers

high labour turnover can help a business plan to reduce employee numbers as workers who leave will not be replaced

recruiting and selecting employees

effective recruitment and selection of employees should meet the needs of the business and increase chances of achieving its long-term objectives

recruitment and selection will be necessary when:

the business is expanding and needs a bigger workforce

employees leave and need to be replaces

Businesses often outsource the recruiting function to specialist recruitment agencies

recruitment is the process of identifying the need for a new employee, defining the job to be filled and the type of person needed to fill its and attracting suitable candidates for the job

selection is the series of steps by which candidates are interviewed, selected, tested, and screened to choose the most suitable person for a vacant post

a recruitment agency is a business that offers the service of recruiting applicants for vacant posts

process of recruitment and selection

establishing the exact nature of the job and drawing up a job description which is a detailed list of key points about the job to be filled, stating all its key tasks and responsibilities

drawing up a person specification which is a detailed list of the qualities, skills and qualifications that a successful applicant will need to have

preparing a job advertisement, the most common way to apply for this is to complete an application form which is a set of questions answered by a job applicant to give a potential employer information about the applicant, such as educational background and work experience

making a shortlist of applicants which are chosen based on their application forms and their personal details often contained in a CV (curriculum vitae) which is a detailed document that highlights all of a persons professional and academic achievements, work experience, and awards, or a resume which is a less detailed version of a CV. References are sometimes obtained from previous employers and they are a comment from a trusted person about an applicabt’s character or previous work experience

Selecting between the applicants, interviews are the most common way of doing this although assessment centres which is a place where a range of tests is used to judge job applicants on their potential ability to perform a particular role, are becoming increasingly popular

internal and external recruitment AND THEIR ADVANTAGES

If the selected candidate already works for the organisation it is referred to as internal recruitment, if they are from outside of the business it is known as external recruitment

internal recruitment advantages

applicants may already be known to the selection team

applicants will already know the organisation and its internal methods so there is no need for induction training

the culture of the organisation will be well understood by the applicants

it is often quicker than external recruitment

it is likely to be cheaper as they aren’t using anything external

it gives internal staff a career structure and a change to progress

if the vacancy is for a senior post then workers will not have to get used to a new style of management

external recruitment advantages

external applicants will bring new ideas and practices to the business which helps to keep new employees focused on the future

there is a wider choice of potential applicants

it avoids resentment felt by existing colleagues if their colleague is promoted

the standard of applicants could be higher

employment contracts

an employment contract is a legal document that sets out the terms and conditions governing a workers job, it typically contains these features:
the employees work responsibilities and the main tasks to be undertakes

whether the contract is permanent or temporary

working hours and the level of flexibility expected

holiday entitlement and other benefits like pensions

the number of days’ notice that must be given by the worker or the employer

redundancy

redundancy is when a job is no longer required and the employee doing this job then becomes unnecessary through no fault of their own

when they take place then guidelines are followed to ensure that the correct person or people are made redundant and so many businesses will do this by natural wastage

voluntary redundancy is when an employer offers the choice to leave their job with a redundancy package

involuntary redundancy is when the employer terminates the contract due to circumstances beyond their control

dismissal

dismissal is when someone is dismissed or fired from their job due to incompetence or breach of discipline, before it can happen the HR department must do all that it can to help the employee reach the required standard or stay within the conditions of employment

It is important from the organisations point of view that it does not leave itself open to allegations of unfair dismissal which is when they end a workers employment contract for a reason that the law regards as being unfair

only a tribunal can decide whether a dismissal is unfair or not and to show a dismissal is fair they need to show that one of the following is true of the employee:

inability to do the job even after sufficient training has been given

continuous negative attitude at work

disregard of required health and safety procedures

deliberate destruction of an employers property

bullying of other employees

unfair dismissal would be:

pregnancy

a discriminatory reason

being a member of a union

employee morale and welfare

HR managers should not just focus on making sure the business has enough workers. Employee productivity and work satisfaction have been shown to be much higher in those businesses that put strategies in place to improve levels of employee morale and employee welfare

employee morale is the overall outlook, attitude, and level of satisfaction of employees when at work

employee welfare is the employees health, safety, and level of morale at work.

work-life balance

work-life balance is a situation in which employees are able to allocate the right amount of time and effort to work and to allocate their personal life outside work

the demands of working long and often unsociable hours that many businesses impose on their employees can lead to stress and poor health and so HR departments should assist employees to achieve a better work-life balance which will reduce stress and increase employee efficiency.

the impact of diversity and equality in the workplace

most organisations have policies that try to ensure equality and diversity in the workforce

equality policy is the practices and processes aimed at achieving a fair organisation where everyone is treated in the same way without prejudice and has the opportunity to fulfil their potential

diversity policy is the practices and processes aimed at creating a mixed workforce and placing a positive value on diversity in the workplace

promoting equality in the workplace impacts on business by:

creating an environment with high employee morale and motivation

developing a good reputation and the ability too recruit top talent based on fairness

measuring employee performance by their achievements at work not by any discriminatory factor

promoting diversity in the workplace impacts on the business by:

capturing a bigger market share as consumers are attracter by a diverse sals force

employing a more qualified workforce as selection is based on merit and not on discrimination

increasing creativity as individuals from different backgrounds approach problem solving in different ways

achieving cultural awareness

promoting diverse language skills

training and developing employees

the HR department must ensure that the new employees are well equipped to perform the duties and undertake the responsibilities expected of them, this almost always requires training which is the work-related education to increase workforce skills and efficiency

types of training

induction training is an introductory training programme to familiarise new recruits with the systems used in the business and the layout of the business site, it should be given to all new recruits

on-the-job training involves instruction at the place of work in how a job should be carried out

off-the-job training is training undertaken away from the place of work

impact of training on a business and its employees

reasons why businesses are discouraged to do training

it can be expensive

it can lead to well qualified employees leaving for a better paid job once they have gained qualifications from a business with a good training programme

other business can ‘steal’ well trained employees from another business which is known as poaching

workers may be less productive during the training programme

reasons why businesses should do training

untrained employees will be less productive, less flexible and less adaptable

poorly trained workers often give unsatisfactory customer service

accidents are likely to occur from workers in untrained health and safety matters

there is a significant link between the importance given to the training and development of employees in a business and the levels of employee satisfaction and motivation

the multi-skilling of workers can be a great benefit to a business

development and appraisal of employees

To enable a worker to continually achieve a sense of self fulfilment, the HR department should work closely with the workers functional department to establish a career plan that the individual feels is relevant and realistic, they should also analyse the likely future needs of the business when establishing a development plan

employee appraisal is often undertaken annually as it is an essential component of a staff development programme

employee appraisal is the process of assessing the effectiveness of an employee judged against pre-set objectives

employee development to encourage intrapreneurship

many businesses have training and development programmes with the specific aim of encouraging employees to become successful intrapreneurs

most employees can demonstrate intrapreneurship if they are:

encouraged to be independent thinkers and creative

given opportunities to mix and work with other skilled employees from different departments

empowered with the authority and resources they need to introduce innovations

assured that some failure is expected and acceptable

encourages to start with small ideas and innovations before moving on to the bigger issues

benefits of cooperation between management and the workforce

fewer days are lost through strikes and other forms of industrial action

it will be much easier for management to introduce change in the workplace

the contribution of the workforce is likely to be recognised by management

agreement on more efficient operations will increase the competitiveness of the business

workers’ practical insight into the way the business operates can contribute to more successful decisions

industrial action is the measures taken by the workforce or trade union to put pressure on management to settle an industrial dispute in the favour of employees

impact of trade union involvement in the workplace

there are various reasons for a worker to join a trade union:

the basis of trade union influence has been ‘power through solidarity’ which is best illustrated by the unions ability to engage in collective bargaining which is the process of negotiating terms of employment between an employer and a group of workers usually represented by a trade union official

Individual action may not produce a result whereas collective industrial action could result in much more influence over employers

unions proved legal support to employees who claim unfair dismissal or poor working conditions

unions put pressure on employers to ensure that all legal requirements are met

most employers have policy of trade union recognition which is when an employer formally agrees to conduct negotiation on pay and working conditions with a trade union rather than bargain individually with each worker

benefits of collective bargaining

employers can negotiate with one trade union officer rather than individual workers which saves time and prevents workers from feeling that one individual gets treated better than the others

union officials can provide a useful change of communication with the workers

unions can impose discipline on members who pan to take industrial action which could disrupt a business

the growth of responsible, partnership unionism has given employers a valuable forum for discussing issues of common interest and making new workplace agreements

disputes between trade union and management

trade union leaders can use multiple forms of industrial action during a dispute:

continue collective bargaining

go slow - workers work at a minimum pace

work-to-rule - a form of industrial action in which employees refuse to fo any work outside the precise terms of the employment contract

overtime bans - industrial action where workers refuse to work more than the contracted number of hours each week

strike action - the most extreme form of industrial action whatever employees completely withdraw from labour for a period of time

employers can use various methods to solve this

negotiations to reach a compromise solution with an aim of avoiding industrial action

Public Relations campaign to gain public support and put pressure on the trade union

threats of redundancies to pressurise unions to agree to settle the dispute

changes of contract which requires workers to wrk overtime

lock outs which is the short term closure of the business to prevent employees from working and being paid

closure of all business leading to the redundancy of all workers

what is motivation and why does it matter?

motivation is the internal and external factors that stimulate the desire in workers to be continually interested in, and committed to doing a job well

well motivated workers benefit the businesses they work for in several ways:

the level of productivity will be high which increases the competitiveness

workers will be keen to stay within the business which reduces labour turnover

workers will be more likely to offer useful suggestions to help the business achieve its objectives

they will often work hard to seek promotion and responsibility

human need

people work to satisfy some or all of their needs, money is one of them so that they can access food, housing, and consumer goods

If employment does not provide the conditions for human needs to be met then workers are likely to be demotivated, needs that can be satisfied at work are:

social connection by working in groups or teams

challenge by providing different work tasks and chance of promotion

significance by praising and recognising performance

certainty by providing employment contracts and some job security

content theories of motivation

these are theories that focus on the assumption that individuals are motivated by the desire to fulfil their inner needs, they focus on:

those human needs that energise and direct human behaviour

how managers can create conditions that allow workers to satisfy these needs

Fredrick Taylors motivational theory

He wanted to advise management on the best ways to increase worker performance and productivity and so his aim was to reduce the level of inefficiency that existed in the American manufacturing industry

his specific approach to improving worker output or productivity:

1. select workers to perform a task

2. observe them performing the task and note the key elements of it

3. record the time taken to do each par of the task

4. identify the quickest method

5. train all workers in this quickest method and do not allow any changes

6. supervise workers to ensure that this best way is being carried out

7. pay workers on the basis of results, based on the economic man theory, which suggests that people are motivated by money alone and so the amount paid should be directly linked to the output through a system known as piece rate

   piece rate is payment to a worker for each unit produced

His approach was widely adopted by manufacturers in the early 20th century and his methods are still relevant and seen in some places in the modern industry

Mayo and HR theories

He is best known for his Hawthorne effect conclusions which were based on a series of experiments conducted at the Hawthorne factory. He initially assumed that working conditions like lighting and heating had a significant effect on workers productivity. The experiments showed:

working conditions in themselves were not important in determining productivity levels

other motivational factors needed to be investigated before conclusions could be drawn

The conclusions were:

changes in the working conditions and pay levels have little to no effect on productivity

consultation with workers improves motivation

working in teams and developing a team spirit can improve productivity

giving workers some control over their own working lives improves motivation

groups can establish their own targets which can be greatly influenced by th informal leaders of the group

evaluation

there has been a trend towards giving workers more of a role in business decision making

HR departments have been established to try and put the Hawthorne effect into place

The idea of involving workers, taking an interest in their welfare and finding out their individual goals has opened up new fields of research for industrial psychologists

Maslow and human needs

Abraham Maslow is best known for his research into identifying and classifying the main needs that humans have, the importance of his work to business managers is:

our needs determine our actions

if work can be organised so that some or all needs of employees can be satisfied at work then they will become more productive and satisfied

He interpreted his hierarchy as followed:

individuals needs start on the lowest level

once one level has been satisfied then humans will work to achieve the next level

self-actualisation or self-fulfilment is not reached by many people but everyone is capable

once a need is satisfied then it will no longer motivate individuals to action

reversion is possible and so some individuals feel less satisfied at one level and move down for satisfaction down the next level

- Each level of need of the Maslow hierarchy can be satisfied at work by effective HR management

limitations include:

not everyone has the same needs

in practice it can be difficult to identify the degree in which each need has been met and which level a worker is on

money is necessary in satisfying physical needs but can also play a role in satisfying the other levels of needs

self actualisation is never permanently achieved

Herzberg and the two-factor theory

Fredrick Herzberg developed the two-factor theory from research based around questionnaires and interviews with 200 skilled employees, his aim was:

those factors that led them to having very good feelings towards their jobs

those factors that led them to having very bad feelings towards their jobs

his conclusions were:

job satisfaction results from 5 main factors: achievement, recognition for achievement, the work itself, responsibility, and advancement, he called these motivators and considered the last three to be most relevant

job dissatisfaction results from 5 main factors: company policy and administration, supervision, salary, relationships with others, and working conditions, he called these hygiene factors, these are extrinsic factors which are factors that surround the job, rather than the work itself intrinsic factors

consequences of Herzbergs two-factor theory and evaluation

higher pay and better working conditions will help to remove dissatisfaction about work although this will not lead to effective motivation and so he argues that it is possible to encourage someone to do a job by paying them (movement) but this movement doesn’t mean someone wants to do the job well because that would require motivation

These factors could also lead people to quickly take them for granted once they have been established and so work needs to be interesting, rewarding, and challenging to satisfy workers and motivate them to fulfil their full potential

Herzberg suggested that motivators could be provided by adopting the principles of job enrichment which aims to use the full capabilities of workers by giving them the opportunity to to more challenging and fulfilling work.

If these are adopted then motivators exist: complete units of work, feedback on performance, and a range of tasks

evaluation

team working is now much more widespread

workers tend to be made much more responsible for the quality of their own work

most firms are continually looking for ways to improve effective communication

McClennand and motivational needs theory

David McClennand pioneered workplace motivational thinking, developed and achievement based motivation theory and promoted improvements in employee assessment methods, he is best known for describing 3 types of motivational need:

achievement motivation - a person with strong motivational need for achievement will seek to reach realistic and challenging goals and job advancement and so there is a constant need for feedback regarding progress and achievement which provides a sense of accomplishment

authority/power motivation - a person with this dominant need is motivated by having authority

affiliation motivation - a person who’s strongest motivator is the need for affiliation has a need for friendly relationships and is motivated by interaction with other people

process theories - vroom and expectancy theory

Victor Vroom suggested that individuals choose to behave in ways which they believe will lead to results that they value and his expectancy theory states that individuals have different sets of goals. They can be motivated if they believe that:

there is a positive link between effort and performance

favourable performance will result in a desirable reward

the reward will satisfy an important need

the desire to satisfy the need is strong enough to make the work effort worthwhile

his expectancy theory is based on the following 3 beliefs:

valence - the depth of the desire of an employee for an extrinsic reward such as money or an intrinsic award such as satisfaction

expectancy - the degree to which people believe that putting effort into work will lead to a given level of performance

instrumentality - the confidence of employees that they will actually get what they desire, even id it has been promised by the manager

the motivational theories in practical situations

All motivational theories recognise that very few people would be prepared to work without financial reward and so pay is essential to encourage work effort. They can disagree over whether pay is sufficient to generate motivation and how pay should be calculated

If pay or other financial motivators are insufficient to ensure that workers are motivated to work to their full potential, then non-financial methods need to be considered

Financial motivators - time based wage rate

a time based wage rate is a payment to a worker made for each period of time worked

advantages

it offers some security over pay levels

different rates can be offered to different types of workers

disadvantages

there is no incentive to increase output as pay level is not directly linked to output

labour cost per unit will depend on output which will vary

financial motivators - piece rate

advantages

it motivates workers to increase output

it is easy to calculate the labour cost per unit

disadvantages

quality might fall

in many jobs, individual worker output cannot be calculated

there is no security over the level of pay

workers may become stressed and unwell by trying to earn more

financial motivators - salary

a salary is an annual income that is usually payed on a monthly basis

advantages

it offers the security of a pay level to employees

there are different salary levels for different grades of workers

it is suitable for jobs where output is not measurable

it is often fixed for one year and so labour costs are easier to forecast

disadvantages

it is not directly linked to output so complacency may be a problem

in may lead to low achievement/motivation if the effort and achievement of the employee are not regularly checked with appraisal

financial motivators - commission

commission is a payment to a salesperson for each sale made

advantages

it creates the incentive to increase sales

it may be in addition to a basic salary so it could offer some security of pay too

disadvantages

it discourages teamwork amongst sales employees

it may lead to pressurised selling which damages customer relationships

financial motivators - bonus payment

a bonus is a payment made in addition to the contracted wage or salary

advantages

it is paid to individuals for outstanding work or for teams reaching targets

it creates incentives for employees to do well

it is inanition to basic salary so it offers some security too

disadvantages

it can cause resentment if the bonus us not received

it damages team spirit if only some members receive a bonus

it reduces motivation if no bonuses are paid

financial motivators - performance related pay (PRP)

performance related pay is a bonus scheme to reward employees for above average work performance

advantages

individual bonuses for meeting pre-determined targets may encourage workers to work hard to meet these targets

target setting can form part of the hierarchy of objectives to meet the company’s aims

disadvantages

it requires frequent target setting and appraisal interviews

if the bonus is low it may not lead to greater effort as motivation will not be increased

managers might show favouritism to some employees by giving out generous bonus payments

financial motivators - profit sharing

profit sharing is a bonus for employees based on the profits of the business and it is usually paid as a proportion of basic sallies

advantages

it aims to increase the commitment of the workforce to make the business profitable

it might lead to suggestions for cost cutting and ways to increase sales

disadvantages

it might only be a very small proportion of total profits so is not motivating

shareholders might object as it could reduce profit for them

it reduces profit retained for expansion

financial motivators - share-ownership schemes

a share-ownership scheme is a scheme that gives employees shares in the company they work for or allows them to buy those shares at a discount

advantages

it reduces the conflict of objectives between owners and workers

it encourages an increased sense of belonging and commitment

workers are more likely to participate in decision making aimed at business success

disadvantages

it may be a very small number of shares so is not motivating

shares might just be sold so that there is no long term commitment

managers often receive more shares so the workforce may feel more resentment towards the managers

financial motivators - fringe benefits

fringe benefits are benefits given serrate form the pay by the employer to some or all employees

they are used by businesses in addition to normal payment systems in order to give status to higher level employees and to recruit and retain the best staff

they include things such as free insurance and pension schemes, company cars, private health insurance and discounts on company products

non-financial motivators - job rotation

job rotation is a scheme that allows employees to switch from one job to another

benefits

rotation may receive the boredom of doing one task

it can give the worker several skills which makes the workforce more flexible

workers are more able to cover for a colleges absence

limitations

job rotation is more limited in scope than job enrichment

it does not increase empowerment or responsibility for the work being performed

it does not necessarily give a worker a complete unit of work to produce

non-financial motivators - job enlargement

job enlargement is an attempt to increase the scope of a job by broadening or deepening the tasks undertaken

non-financial motivators - job enrichment

job enrichment involves a reduction of direct supervision as workers take more responsibility for their own work and are allowed some degree of decision-making authority

benefits

complete units of work are produced so that the workers contribution can be identified and more challenging work can be offered

direct feedback on performance

challenging tasks are offered as a part of a range of activities, some of which are beyond the workers experience, these tasks will require refining and the learning of new skills

limitations

lack of employee training or experience to cope with the greater depth of tasks can result in lower productivity

employees may see the enrichment process as an attempt to get them to do more work

if employees are jus not able to cope with the additional challenges imposed by job enrichment then it can lead too frustration and demotivation

managers must accept reduced control and supervision over the work of employees

non-financial motivators - job redesign

job redesign is the restructuring of a job to make the work more interesting, satisfying, and challenging

non-financial motivators - training and development

development is the gaining new or advanced skills and knowledge as well as opportunities to apply what is gained

benefits

improving and widening the skills off employees can increase the productivity and flexibility of the workforce

training and development can increase the status of workers and give them access to more challenging and better-paid jobs

developing employees and encouraging them to reach their full potential increase the opportunities for self actualisation

trading and development are often important incentives for employees to stay with a business as they feel they are being recognised and appreciated bu the company

limitations

training can be expensive

training and development programmes can take employees away from their work for some time and so employees will need to cover for them

training can lead to employees leaving a business as they become better qualified to gain employment within other companies

non-financial motivators - opportunities for promotion and increased status

employee promotion is the advancement of an employee within a business to a higher level of responsibility and status

employee status is the level of recognition offered by an employer to a worker in terms of pay, level of responsibility, and benefits

It allows employees to work towards advancement to a higher level within the business

promotion results in increased employee status which satisfies a key human need

employee participation in management and the control of business activity

employee participation is the active encouragement of employees to become involved in decision-making within an organisation

team working - employee participation

team working is production organised so that groups of workers undertake complete units of work

advantages

teams are empowered by given decision-making authority over their work and planning of it

workers will not want to let down other team members so absenteeism should fall

workers are likely to be better motivated as social and esteem needs are more likely to be met

better-motivated team members increase productivity and labour turnover is reduces

it makes full use of all talents of the workforce

it can lead to lower management costs

complete units of work can be given to teams

disadvantages

not everyone is a team player and some individuals are more effective working alone and so training may need to be put in place

teams can develop a set of values and attitudes which may conflict with those of the organisation itself

the introduction of team working will require training to improve employee flexibility and this could be costly

there may be some disruption to production as the teams establish themselves

empowerment - employee participation

empowerment is the giving of skills, resources, authority, and opportunity to employees so that they can take decisions and be accountable for their work

benefits

it leads to quicker problem solving as they do not need to refer to managers

higher levels of motivation and morale result as workers are given more challenging work and are recognised for it

higher levels of involvement and commitment improve two way communication and help to reduce labour turnover

managers are able to focus on bigger strategic issues as they are released for more routine issues and problem-solving

limitations

lack of experience increases risk

reduced supervision and control might lead to poor decisions

there may be lack of coordination between teams

some employees may be reluctant to accept more accountability but feel they have in order to keep their job secure

quality circles - employee participation

a quality circle (QC) is a voluntary group of workers who meet regularly to discuss, and try to resolve, work related problems and issues

benefits

worked have hands on experience of work problems and often suggest the best solutions

the results of the QC meetings are presented to management and successful ideas are often adopted across the whole organisation

QC’s are an effective method of allowing the participation of all employees

limitations

QC meetings can bee time-consuming and reduce the time available for production

not all employees will want to be involves in QC’s

QC’s may not have the management power to make the changes that they recommend

traditional manager functions

planning - giving the business a direction for the future

organising - the people and other resources needed

directing - leading and motivating people in the organisation

controlling - ensuring that the original plan is being followed

the role of managers: Fayol and Mintzberg

the key functions and role of management are common to all and are effectively explained by reference to two of the best known management writers, Fayol and Minztberg

management is the organisation and coordination of actives in order to achieve the defined objectives of the business

Fayol’s functions of management

Planning

organising resources to meet objectives

commanding, directing, and motivating employees

coordinating activities

controlling and measuring performance against targets

Mintzberg - management roles

He considered that the activities of managers can be summed up by his ten roles of management which are divided into 3 groups:

interpersonal - dealign with and motivating employees at all levels of the organisation

informational - acting as a source, receiver and transmitter of information

decisional - taking decisions and allocating resources to meet the organisations objectives

interpersonal

figurehead - symbolic leader of the organisation, undertaking duties of a social or legal nature

leader - motivating subordinates; selecting and training other managers/workers

liaison - linking with managers and leaders of other divisions of the business and other organisations

informational

monitor (receiver) - collecting data relevant to the business’s operations

disseminator - sending information collected from external and internal sources to the relevant people within the organisation

spokesperson - communicating information about the organisation - its current position and achievements - to external groups and people

decisional roles

entrepreneur - looking for new opportunities to develop the business

disturbance handler - responding to changing situations that may put the business at risk

resource allocator - deciding on the spending of the organisation’s financial resources and the allocation of its physical and human resources

negotiator - representing the organisation in all important negotiations

the contribution of managers to business performance

the key indicators that managers are having a positive impact on business performance are:

the business regularly meets its objectives

high levels of customer satisfaction

high employee motivation levels and low labour turnover

a respected brand image

high regard from external stakeholders such as environmental and social pressure groups

excellent communication both within the business and external stakeholders

main managerial positions in a business

Chief Executive Officer (CEO) - the highest ranking executive in a company whose primary responsibilities are: making major corporate decisions, managing overall options, and managing company resources

director - an appointed or elected member of the board of directors of a company who, with other directors, has the responsibility for determining and implementing the company’s policy and they report to the CEO

manager - an individual responsible for people, resources or decision-making can be termed as a manager. They have authority over other employees below them in the hierarchy. They direct, motivate, and if necessary, discipline the employees in their section or department

supervisor - these are appointed by management to watch over the work of others. This is usually not a decision-making role. They have responsibility for leading and controlling a ream of people in working towards pre-set goals

autocratic management

autocratic management is a management style where one manager takes all decisions with very little, if any, input from others

key features

leader takes all the decisions

they give little information to workers

they supervise workers closely

only one-way communication is used

workers are given only limited information about the business

limitations

demotivates workers who want to contribute and accept responsibility

decisions do not benefit from employee input

democratic management

democratic management is a management style that encourages the active participation of workers in taking decisions

key features

participation is encouraged

two-way communication is used which allows feedback form workers

workers are given information about the business to allow their full involvement

limitations

consultation with workers can be time-consuming

on occasions, quick decision making will be required

some business issues might be too sensitive to allow worker involvement or too secret

paternalistic management

paternalistic management is a management style based in the view that the manager is in a better position than the workers to know what is best for an organisation

key features

managers do what they think is best for the workers

some consultation might take place, but the final decision is taken by the managers

managers want workers to be happy in their jobs

limitations

some workers will be dissatisfied with the apparent attempts to consult, while not having any real power or influence

laissez-faire management

laissez-faire management is a management style which leaves much of the decision-making to the workforce

key features

managers delegate virtually all authority and decision-making powers

very broad criteria or limits might be established for the staff to work within

limitations

workers may not appreciate the lack of structure and direction in their work which could lead to a loss of security

lack of feedback - as managers fo not closely monitor progress which may be demotivating

McGregor’s theory X and theory Y

According to Douglas McGregor as a result of his studies in the 1950s, one of the most important determinants is the attitude of managers towards their workers, he identified 2 distinct management approaches to the workforce called Theory X and Theory Y

Theory X - managers believe that workers dislike work, will avoid responsibility, and are not creative. They also believe that employees are lazy, fear motivated and in need of constant direction

Theory Y - managers believe that employees can derive as much enjoyment from work as from rest and play, will accept responsibility, and are creative. They also believe that employees are internally motivated, enjoy their work and are prepared to take on on additional responsibilities