A Level Business Year 1 - Unit 2 Managers, Leadership and Decision Making

Leadership

The functions of ruling, guiding and inspiring other people within an organisation in pursuit of agreed objectives.

Management

Planning, organising, directing and controlling all or part of a business enterprise.

Authority

The power or ability to carry through an action.

Delegation

Passing authority down the organisational hierarchy.

Empowerment

Providing subordinates with the means to exercise power or control over their working lives.

Decentralisation

Passing authority from the centre of an organisation to those working elsewhere in the business.

Programmed decisions

Familiar and routine decisions.

Non-programmed decisions

Decisions made about less structured problems that require unique solutions.

Risk

The chance of incurring misfortune or loss.

Uncertainty

A situation in which there is a lack of knowledge and events, outcomes or consequences are unpredictable.

Opportunity cost

The next best alternative foregone.

Scientific decision making

Based on data and uses a logical, rational approach to decision making.

Decision tree

A model that represents the likely outcomes for a business of a number of courses of action on a diagram showing the financial consequences of each.

Probability

The chance of a particular event occuring.

Expected values

The financial outcomes from a specific course of action adjusted to allow for the probability of it occuring.

Net gains

The expected values of a course of action minus the costs associated with it.

Ethics

Moral principles, which should underpin business decisions and actions.

External environment

Comprises those external forces (such as changes in competition or consumers' incomes) that can influence a business's activities.

Stakeholders

Groups or individuals who have an interest in a business.

Social responsibility

The duties a business has towards stakeholder groups such as employees, customers and the government.

Market conditions

A numbers of features of a market, such as the level of sales, the rate at which they are changing and the number and strength of competitors.

Communication

The exchange of information or ideas between two or more parties.

Stakeholder engagement

A process by which managers involve individuals and groups who may be affected by their decisions in those decisions.

Consultation

A process by which one group discovers the views of another one.