Business Management Unit 3 AOS 2

Human Resource Management (Definition)

The organisation of the employees' roles, pay and working conditions

Motivation (Definition)

Motivation is the willingness of an individual to expend energy and effort in completing a task

Maslow's Hierarchy of Needs (Definition)

Maslow's Hierarchy of Needs is a motivational theory that suggests people have five fundamental needs, and their sequential attainment of each needs acts as a source of motivation.

Ads of Maslow's Hierarchy of Needs

- Can help managers determine which level of the hierarchy is motivating an employee.

- Motivation can occur quickly when employees progress through the lower levels of hierarchy.

- Employees can work in an engaging environment that allows them to reach their full potential.

- Satisfying social needs may not increase business expenses.

Disads of Maslow's Motivational Theory

- Not all employees will be motivated by the same needs at once.

- It may be time consuming for a manager to determine the level of each individual employee and implement appropriate strategies for each.

- Satisfying physiological and esteem needs may result in a direct increase in business expenses.

- It is difficult to measure success, as the levels of satisfaction gained at each stage can vary among people.

Physiological Needs (Definition)

Physiological needs are basic requirements for human survival, such as food, water, and shelter

Safety & Security Needs (Definition)

Safety and security needs are the desires for protection from dangerous or threatening environments

Social Needs (Definition)

Social needs are the desires for a sense of belonging and friendship among peer groups, both inside and outside the workplace.

Esteem Needs (Definition)

Esteem needs are an individual's desires to feel important, valuable, and respected.

Self-actualisation Needs (Definition)

Self-actualisation needs are the desires for an employee to reach their full potential through creativity and personal growth.

Lawrence & Nohria's Motivational Theory (Definition)

Lawrence and Nohria's Four Drive Theory is a motivational theory that suggests that people strive to balance four fundamental desires.

Ads of Lawrence & Nohria's Motivational Theory

- Provides a simple approach for motivating employees and is easy for managers to implement.

- All four drives can be attained simultaneously, and are not restricted to sequential orders

- Satisfying drives can improve employee performance and business productivity and therefore increase business profits.

- The four drives act to motivate employees and can allow them to feel more engaged in their work

Disad's of Lawrence & Nohria's Motivational Theory

- Managers may find it difficult to manage four drives simultaneously.

- Some drives can be overlooked and therefore, an employee's full potential may not be achieved.

- Employees may not value all drives equally and therefore, a balance between drives cannot be achieved.

- Individual employees may have different drives that are yet to be met

- Training programs and sponsoring the education of employees to fulfil the drive to learn can increase business expenses.

Drive to Acquire (Definition)

The drive to acquire is the desire to achieve rewards and high status.

Drive to Bond (Definition)

The drive to bond is the desire to participate in social interactions and feel a sense of belonging.

Drive to Learn/Comprehend (Definition)

The drive to learn is the desire to gain knowledge, skills, and experience.

Drive to Defend (Definition)

The drive to defend is the desire to protect personal security as well as the values of the business

Locke and Latham's Motivational Theory (Definition)

The Goal Setting Theory is a motivation theory that states that employees are motivated by clearly defined goals that fulfil five key principles.

Ads of Locke and Latham's Motivational Theory

- Goals that align employee goals with achieving business objectives are likely to improve business performance.

- The process of managers setting goals with employees can improve levels of trust

- When employee goals align with business objectives, they can contribute to a business's financial aims

- Employees may be more motivated to complete tasks if work goals align with their personal interests.

Disads of Locke and Latham's Motivational Theory

- It may be difficult for a manager to always align an employee's personal goals with business objectives.

- Employees may become stressed and demotivated if they have too many goals at once

- Failure to meet a goal may result in an employee losing confidence and feeling less motivated

- The process of setting goals and providing feedback to each employee can be time-consuming for management.

Key Principles of Locke and Latham's Motivational Theory

Clarity, Commitment, Challenge, Task Complexity, Feedback

Motivation Strategies

Performance related pay, Career advancement, Investment in training, Support, Sanction

Performance Related Pay (Definition)

Performance-related pay is a financial reward that employees receive for reaching or exceeding a set business goal.

Career Advancement (Definition)

Career advancement is the upwards progression of an employee's job position. This can be achieved through promoting employees or giving them more challenging tasks.

Investment in Training (Definition)

Investment in training is allocating resources to improve employee skills and knowledge.

Support (Definition)

Support strategies involve providing employees with any assistance that improves their satisfaction at work.

Sanction (Definition)

Sanction strategies involve penalising employees for poor performance or breaching business policies.

On-the-job Training (Definition)

involves employees improving their knowledge and skills within the workplace.

Ads of On-the-job Training

- Employees can perform their role while training, minimising losses to productivity.

- Employees can quickly become familiar with work equipment, reducing the time taken to complete their training.

- Training employees internally is often less expensive than performing training externally, as there are no travel costs.

Disads of On-the-job Training

- The business may lack the amount experienced staff required to train employees.

Employees completing the training may become distracted by the workplace.

Experienced employees are taken away from completing other duties to train employees.

Off-the-job Training (Definition)

involves employees improving their knowledge and skills in a location external to the business.

Ads of Off-the-job Training

- Access to expert knowledge, leading to deeper understanding

- A broader range of skills can be taught or learned

- Being away from the workplace minimises distractions

Disads of Off-the-job Training

- The cost involved with external training is expensive.

- Employees are absent from regular work duties.

- Coordinating all logistical challenges adds complexity to the training process.

- Generic training programs may not improve unique skills required by a business.

Performance Management Strategies

Management by objectives, performance appraisals, self-evaluation, employee observation

Management By Objectives (Definition)

involves both managers and employees collaboratively setting individual employee goals that contribute to the achievement of broader business objectives

Ads of Management By Objectives

- Aligning employee goals with business objectives means employees are working towards business objectives

- Collaboration when setting goals fosters positive workplace relationships

- Employees feel motivated when reaching their individual goals

Disads of Management By Objectives

- Employees may take shortcuts to achieve their individual objectives

- Failure to achieve individual objectives is demoralising

- Employees feel demotivated if they don't receive compensation or recognition after achieving objectives

Performance Appraisals (Definition)

involves a manager assessing the performance of an employee against a range of criteria, providing feedback, and establishing plans for future improvements

Ads of Performance Appraisals

- Communication during reviews increases workplace relationships

- The strategy outlines areas for improvement, allowing training to be implemented

- Communication provides employees with clear direction on how to improve performance

Disads of Performance Appraisals

- Employees lose motivation from receiving multiple poor performance appraisals

- Time consuming

- Training courses provided increase business expenses

Self-Evaluation (Definition)

involves an employee assessing their individual performance against a set of criteria

Ads of Self-Evaluation

- Manager sees an employees understanding of their strengths and weaknesses

- Employees are empowered to improve performance, as they are involved in their performance management

- Saves manager time

Disads of Self-Evaluation

- Employees can be biased or dishonest

- Employees may underestimate or exaggerate their own skills

- Time consuming for managers to develop the criteria

Employee Observation (Definition)

involves a range of employees from different levels of authority assessing another employee's performance against a set of criteria

Ads of Employee Observation

- Accurate analysis of employees performance if they are unaware

- Employees observing may identify and mimic strengths

- More responsive to feedback provided by peers

Disads of Employee Observation

- Misleading results if employee is aware of observation

- Disrupts employees workflow and productivity

- Developing criteria can be time consuming

Retirement (Definition)

involves an individual deciding to leave the workforce permanently as they no longer wish to work.

Redundancy (Definition)

involves an employee no longer working for a business because there is insufficient work, or their job no longer exists.

Resignation (Definition)

involves an employee voluntarily terminating their own employment, usually to take another job position elsewhere.

Dismissal (Definition)

involves the involuntary termination of an employee who fails to meet required work standards or displays unacceptable or unlawful behaviour.

Entitlement Considerations (Definition)

are legal obligations an employer owes to its employees following the termination of their employment contact.

Transition Considerations (Definition)

are social and ethical practises that a manager can consider implementing when terminating employment.

Workplace Relations (Definition)

is the interactions between employers and employees, or their representatives, to achieve wages and conditions that satisfy both the business and employees.

Human Resource Managers (Definition)

individuals who coordinate the relationship between employees and management within a business

Employees (Definition)

are individuals who are hired by a business to complete work tasks and support the achievement of business objectives.

Employer Associations (Definition)

advisory bodies that assist employers in understanding and upholding their legal business obligations.

Unions (Definition)

organisations composed of individuals who represent and speak on behalf of employees in a particular industry to protect and improve their wages and working conditions.

Fair Work Commission (Definition)

Australia's independent workplace relations tribunal that has a range of responsibilities outlined by the Fair Work Act.

Awards (Defintion)

legal documents that outline the minimum wages and conditions of work for employees across an entire industry.

Ads of Awards

- Employees all receive the same wage and conditions

- Saves time

- Cost effective

Disads of Awards

- Limited flexibility

- Employees unsatisfied with minimum wage

- Lack opportunity for relationship with employee

Agreements (Definition)

legal documents that outline the wages and conditions of employees and are applicable to a particular business or group of businesses.

Ads of Agreements

Dispute Resolution Process (Definition)

is a series of steps that disputing parties follow in order to resolve a disagreement and reach a resolution.

Mediation (Definition)

involves an impartial third-party facilitating discussions between disputing parties to help each side of the conflict reach a resolution themselves.

Ads of Mediation

- Reaching decisions together promotes positive workplace relationships

- Communication breakdown is reduced

- Both parties have control of final decision

- Less expensive

Disads of Mediation

- Final decision may not be reached

- Decision is not legally binding

- Unbalanced power dynamic

- Time consuming

Arbitration (Definition)

involves an independent third-party hearing arguments from both disputing parties and making a legally binding decision to resolve the conflict.

Ads of Arbitration

- Guarantees final decision

- Decision is legally binding

- Power imbalance is reduced

Disads of Arbitration

- Workplace relationships may be harmed

- Time consuming

- Expensive

Similarities (Mediation/Arbitration)

-Individual body or party is required

- More formal than without a third party

Differences (Mediation/Arbitration)

- Role of the third party

- Control of final decision

- Who makes the decision

- Binding

- Setting