FM116 Fashion Business Practices Exam 2

small business

one that is independently owned and operated for profit and is not dominant in its field

span of control

the number of workers who report directly to one manager

organizational height

the number of layers, or levels, of management in a firm

wide span of management (flat organization)

exists when a manager directly supervises a very large number of employees

narrow span of management (tall organization)

exists when a manager directly supervises only a few subordinates

flat organization

high competence in managers and workers, standard operating procedures, and few new problems

tall organization

physical dispersion of subordinates, manager has additional tasks, high level of interaction required between manager and workers, high frequency of new problems

authority

the right to use power

responsibility

Being responsible for one's actions

Theory X

a concept of employee motivation generally consistent with Taylor's scientific management; assumes that employees dislike work and will function only in a highly controlled work environment

Theory Y

a concept of employee motivation generally consistent with the ideas of the human relations movement; assumes responsibility and work toward organizational goals, and by doing so they also achieve personal rewards

Performance Feedback Review

when a manager gives you a review and asks what do you think about that

franchise

a licence to operate an individually owned business as though it were part of a chain of outlets or stores

Why purchase a franchise?

It is a simpler way to get into business because you don't have to go through all of the things established

franchisee

A person who buys a franchise

Franchisor

an individual or organization granting a franchise

Advantages of a small business

personal relationships with customers and employees, ability to adapt to change, simplified record keeping, independence, profit retention, ease and low cost of going into or out of business, ability to keep business information secret

Small Business Development Centers (SBDCs)

university-based groups that provide individual counseling and practical training to owners of small businesses

franchise mediation program

program that settles things when theres conflict between franchiser or franchisee that avoids going to court and saves money

SWOT analysis

the identification and evaluation of a firm's strengths, weaknesses, opportunities, threats

internal

strengths and weaknesses

external

opportunities and threats

TQM (Total Quality Management)

the coordination of efforts directed at improving customer satisfaction, increasing employee participation, strengthening supplier partnerships, and facilitating an organizational atmosphere of continuous quality improvement

Steps in the decision making process

Problem recognition

Information search

Evaluation of alternatives

Product choice

top manager

an upper-level executive who guides and controls the overall fortunes of an organization

middle manager

a manager who implements the strategy and major policies developed by top management

first-line manager

a manager who coordinates and supervises the activities of operating employees

conceptual skills

the ability to think in abstract terms and to see how parts fit together to form the whole

analytic skills

the ability to identify problems correctly, generate reasonable alternatives, and select the "best" alternatives to solve problems

interpersonal skills

the ability to deal effectively with other people

technical skills

specific skills needed to accomplish a specialized activity

communication skills

the ability to speak, listen, and write effectively

leadership

the ability to influence others

Digital Communication

Data in a form that can be transmitted and received electronically

departmentalization

the process of grouping jobs into manageable units

departmentalization by function

grouping jobs that relate to the same organizational activity

(smaller and newer organizations do this, advantages include simplified supervision and easy coordination, disadvantages include slow decision making and it Tends to emphasize the department over the organization as a whole)

departmentalization by product

grouping activities related to a particular product or service

(used often by older and larger firms that produce and sell a variety of products.)

departmentalization by location

grouping activities according to the defined geographic area in which they are performed

departmentalization by customer

grouping activities according to the needs of various customer populations

best form of departmentalization is ______

a combination of bases

small business association

A federal agency that provides loans to small business investment companies (SBICs) that supply venture capital and financing to small businesses. Debentures sold by SBICs are fully guaranteed by the SBA.

forms of organizational structure

line structure

line-and-staff structure

the matrix structure

the network structure

delegation

assigning tasks to people

line structure

an organizational structure in which the chain of command goes directly from person to person throughout the organization

line-and-staff structure

an organizational structure that utilizes the chain of command from a line structure in combination with the assistance of staff managers

matrix structure

an organizational structure that combines vertical and horizontal lines of authority, usually by superimposing product departmentalization on a functionally departmentalized organization

network structure

an organizational structure in which administration is the primary function, and most other functions are contracted out to other firms

steps in the delegation process

1. assigning responsibility

2. granting authority

3. creating accountability

line managers

a position in which a person makes decisions and gives orders to subordinates to achieve the organization's goals, most effective in small-sized organizations

staff manager

a position created to provide support, advice, and expertise within an organization

matrix structure pros and cons

Advantages:

• Adds flexibility

• Increases productivity

• Raises morale

• Nurtures creativity and innovation

• Personal development experienced by employees

Disadvantages:

• Chain of command conflicts

• May take longer to resolve problems and issues

• Personality clashes

• Poor communication

• Undefined individual roles

• Unclear responsibilities

• Difficulties in finding ways to reward individual and team performance simultaneously

• Expensive to maintain

replacement chart

a list of key personnel and their possible replacements within a firm

skills inventory

a computerized data bank containing information on the skills and experience of all present employees

Human Resources

the people who work within an organization and are the most important and valuable resource for a business.

Human Resource Management

all the activities involved in acquiring, maintaining, and developing an organization's human resources

different forms of people leaving a company

layoffs

attrition

early retirement

buyouts

firing

Least offensive way to leave a company

Attrition

Worst way to leave a company

Firing

Advantages of a diverse workforce

cost friendly

resource acquisition, it affects the companies rep

marketing edge

flexibility

creativity

problem solving

bilingual skills

compensation

payment

hourly wage

a specific amount of money paid for each hour of work

salary

a specific amount of money paid for an employee's work during a set calendar period, regardless of the actual number of hours worked

commission

a payment that is a percentage of sales revenue

incentive payment

a payment in addition to wages, salary, or commissions

lump-sum salary increase

an entire pay raise taken in one lump sum

profit-sharing

the distribution of a percentage of a firm's profit among its employees

Job Analysis

a systematic procedure for studying jobs to determine their various elements and requirements

job description

a list of the elements that make up a particular job

job specification

a list of the qualifications required to perform a particular job

Maslow's Hierarchy of Needs

a sequence of human needs in the order of their importance; physiological, safety, social, esteem, self-actualization

Who created the theories?

Douglas McGregor

physiological needs

the things we require for survival

safety needs

the things we require for physical and emotional security

social needs

the human requirements for love and affection and a sense of belonging

esteem needs

our need for respect, recognition, and a sense of our own accomplishment and worth

self-actualization needs

the need to grow and develop and to become all that we are capable of being

extinction

not responding to undesirable behavior with the hope that the behavior will eventually go "extinct"

Forms of Reinforcement

positive reinforcement

negative reinforcement

punishment

extinction

goal

A result that a person aims for and works hard to reach, long term

objective

short term goal

Mission Statement

a statement of the organization's purpose - what it wants to accomplish in the larger environment

negative reinforcement

one that strengthens desired behavior by eliminating an undesirable task or situation

job sharing

an arrangement whereby two part-time employees share one full-time job

part-time job

permanent employment in which individuals work less than a standard work week

incentive pay

forms of pay linked to an employee's performance as an individual, group member, or organization member

benchmarking

a process by which a company compares its performance with that of high-performing organizations

#1 aspect of TQM

customer service or satisfying the customer