Unit 2 Key Terminology
Unit 2.1 Terminology
| Ageing population | A higher average age of the population. |
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| Demography | The statistical study of population trends, such as birth rates, death rates, age distribution, and net migration rates. |
| Dismissal | The employer’s decision to terminate a worker’s employment contract, usually due to the worker’s incompetence and/or a breach of their employment contract. |
| External factors | The issues or factors that are beyond the control of the organization, e.g., national minimum wage legislation. |
| Flexitime | A form of flexible work practice that enables employees to work a set number of core hours each week, often at the office during peak periods of the day and/or week. |
| Geographical mobility | The ability and willingness of employees to relocate to another location or country for work reasons. |
| Gig economy | Labour markets in which people are on short-term, impromptu, temporary contracts. This includes freelance worker and independent contractors. |
| Homeworking | Also referred to as work from home (WFH), this is an aspect of flexitime that involves people using their homes to conduct their jobs. |
| Human resource management | HRM is a broad term used to describe the overall management of an organization's workforce, e.g. attracting, selecting, training, assessing, rewarding and retaining workers. |
| Human resource planning | Also known as workforce planning, this is the management process of anticipating the organization’s current and future human resource needs. |
| Internal factors | The issues or features that are within the control of the organization, e.g., staff remuneration and approaches to training. |
| Labour mobility | Measures the extent to which workers have the ability and willingness to move between geographical locations and/or occupations for their employment. |
| Migrant workers | People who move to other countries in search of better job opportunities. |
| Net migration | This measures the difference between the number of people from abroad who enter a country (immigration) and the number of people who leave (emigration), usually for employment purposes. |
| Occupational mobility | The ability and willingness of employees to do another job or pursue a different career. |
| Portfolio workers | People who carry out several different jobs, often for different contractors, at the same time and usually on a temporary basis. |
| Redundancy | Occurs when an organization no longer has a job for the employee or when the employer can no longer afford to hire the employee, i.e., the job ceases to exist. |
| Teleworking | Flexible working practice that involves employees being away from the office as they rely on the use of telecommunications technologies, e.g. Internet and mobile technologies. |
| Training | This is the provision of work-related education, either on-the-job or off-the-job, such as instructing and teaching (or mentoring) employees how to perform certain tasks in their job. |
| Workforce | The total number of employees in a business organization at any particular point in time. |
| Workforce planning | Also known as human resource planning, this refers to the ongoing process through which the current and future human resource needs of a business are identified and anticipated. |
Unit 2.2 Terminology
| Accountability | The extent to which a person is held responsible for the success or failure of a task, job, or project. It allows senior managers to have better control over the running of their organizations. |
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| Bureaucracy | The administrative systems within an organization, such as the formal policies and procedures of the business. It includes the formal rules, regulations, and procedures of the organization. |
| Centralization | The situation where decision-making is predominantly made by a very small group of senior managers at the top of the organizational hierarchy. |
| Chain of command | The formal lines of authority in an organization. It can be seen via an organizational chart, which shows the formal path through which commands and decisions are communicated from senior managers to subordinates. |
| Communication | The transfer of information from one entity to another. It is vital to how a business operates. |
| Decentralization | The situation in an organization where decision-making authority is delegated throughout, rather from a central authoritative group. |
| Delayering | This occurs when an organization removes one or more layers in its hierarchical structure, i.e., the number of layers of management is reduced, or made flatter. |
| Delegation | The act of line managers entrusting and empowering employees with authority to successfully complete a particular task, project, or job role. |
| Flat organization | Also known as a horizontal structure, this type of organizational structure has only a few layers of management. |
| Flat structure | Type of organizational structure that has few levels in the organizational hierarchy. |
| Hierarchical (hierarchy) | A type of organizational structure that is tall/vertical, with many levels in terms of ranks. |
| Levels of hierarchy | The number of layers of formal authority in an organization. It is represented in an organizational chart. |
| Line manager | The person directly above an employee in the organizational structure of a business. |
| Managers | People responsible for the day-to-day running of the business or a department within the business. |
| Matrix structure | A flexible type of organizational structure consisting of team members from different departments or divisions of the business who work together temporarily on a particular task or project. |
| Organization by function | Structuring a workforce according to business functions, i.e., specialised roles or tasks. |
| Organization by product | Structuring a workforce according to the goods or services sold. Each department focuses on a different product within the organization’s overall product portfolio. |
| Organization by region | Structuring a workforce according to different geographical areas based on where the firm’s operations are. |
| Organizational chart | A diagrammatic representation of an organization’s formal organizational structure. |
| Organizational structure | The formal interrelationships and hierarchical arrangements within a firm. |
| Outsourced workers (HL only) | Also known as outsourced vendors or the contractual fringe, these are the individuals or other organizations hired on a contract basis to carry out a specific but non-core role in Charles Handy’s Shamrock organization. |
| Peripheral workers (HL only) | According to Charles Handy, these are the contingent workers, consisting of part-time and temporary staff hired by the organization. |
| Professional core (HL only) | According to Charles Handy, these are the core workers consisting of full-time specialists who are vital for the organization’s operations and survival. |
| Project-based organization(HL only) | Also known as a matrix structure, this flexible organizational structure is based on the specific needs of a particular short-term or temporary project. |
| Responsibility | Refers to a line manager’s level of concern in term of the people they are in charge of. An organization chart shows the breadth and depth of a person’s roles and responsibilities in the business. |
| Shamrock organization(HL only) | Type of flexible organizational structure, coined by Charles Handy, advocating that organizations must adapt to changes in the business environment by having a core workforce, contingent workforce, and outsourced vendors. |
| Span of control | Refers to how many workers are directly accountable to (or under the authority of) a particular line manager. |
| Tall organization | Also known as a vertical structure, this type of organizational structure has many layers in the organizational hierarchy. |
| Tall structure | Type of organizational structure that has many levels of hierarchy, so the span of control is likely to be narrow. |
Unit 2.3 Terminology
| Autocratic management (leadership) | Management style that involves centralised and autonomous decision-making, without input from others in the organization. |
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| Democratic management (leadership) | Management style that actively involves the participation of employees in the decision-making process. |
| Functions of management | The various roles and responsibilities of managers, i.e., coordinating, commanding, and controlling business operations. |
| Intuitive thinking (management)(HL only) | A quick approach to management based on the manager’s own values, views, and/or gut feelings that are not always quantifiable. |
| Laissez-faire leadership (management) | A hands-off approach to leadership by devolving decision-making power to the workforce. |
| Leadership | The art of inspiring and motivating other people towards achieving a common organizational aim or vision. |
| Leadership style | Refers to the way in which managers and leaders provide direction for others. |
| Management | The art of getting things done through others by setting clear objectives and organising organizational resources. |
| Manager | Someone with decision-making authority in an organization and has responsibility for problem-solving in order to achieve specific organizational goals. |
| Paternalistic management (leadership) | Management style that involves treating workers as family members, so managers make decisions believed to be in the best interest of the workforce |
| Scientific thinking (management) | A relatively long approach to management based on objectivity, facts, and empirical evidence. This approach to management and leadership follows a formal and prescribed procedure. |
| Situational leadership | Leadership style that requires leaders to change and adapt their approach in response to different situations and circumstances. |
| SMART objectives | Peter Drucker’s framework for setting organizational objectives, which must be specific, measurable, achievable, realistic, and timely. |
Unit 2.4 Terminology
| 360-degree appraisal(HL only) | A type of appraisal system that provides feedback from a range of people who work with or interact with the appraisee, such as their line manager, co-workers, subordinates and even customers. |
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| Acquired needs theory(HL only) | D. McClelland’s theory of motivation, based on three types of needs that must be satisfied in order to improve motivation: the need for achievement, power, and affiliation. |
| Appraisal(HL only) | Also known as a performance review, this is the formal procedure of assessing the performance and effectiveness of an employee, in relation to his/her job description. |
| Commission | Type of financial payment system that rewards workers a certain percentage of the sales of each good or service that they are responsible for completing. |
| Differentiated piece rate | Financial payment system advocated by F.W. Taylor to reward workers based on the level of their output or productivity. |
| Division of labour | The process of splitting up different parts of a job or task and assigning different employees or teams to each particular part of the work. This helps to improve operational efficiency and output. |
| Employee share ownership scheme | Type of financial payment system that involves giving workers shares in the company they work for, either free of charge or at a discounted price. |
| Empowerment | The delegation of decision-making power to workers, granting them the autonomy and authority to be in charge of their own jobs and to execute their own ideas. |
| Equity theory(HL only) | J.S. Adams’ theory of motivation suggests that people make social comparisons of fairness in the workplace (based on the ratio of their input (effort) to output (rewards). |
| Esteem needs | In Maslow’s hierarchy of needs, this refers to the desire of people to feel respected, having value and having self-respect. |
| Expectancy theory (HL only) | V. Vroom’s theory of motivation suggests people only put in the amount of effort to do a job or task if they expect their performance to be recognized and rewarded. |
| External recruitment(HL only) | The approach or process of hiring people from outside the organization to fill job vacancies. |
| Formative appraisals(HL only) | Type of appraisal that takes place on a continual basis in order to allow workers to improve their performance and effectiveness. |
| Fringe benefits | Also known as perks, these are financial benefits of a job in excess of the basic pay (wage or salary). |
| Gratuity pay | Financial reward for long-term service or for the completion of a fixed-term contract. |
| Hierarchy of needs | A. Maslow’s theory of motivation that people are motivated by different levels of needs: physiological, safety, social (love and beginning), esteem and self-actualization. |
| Hygiene factors | Also known as maintenance factors, these are the factors that F. Herzberg argued cause dissatisfaction in the workplace (rather than motivation), so must be addressed. |
| Induction training | Type of training intended for new employees in order to help them acclimatise with the people, policies, and processes of the organization. |
| Internal recruitment | The approach or process of hiring people who already work for the organization to fill a vacant post, e.g., internal promotion to a managerial post. |
| Job analysis(HL only) | The process of examining what a particular job involves, thereby enabling the HR department to determine the roles, tasks, duties, responsibilities, and skills required to do the job. |
| Job description(HL only) | Document containing the particulars of a job, e.g., the job title, roles and responsibilities, and other duties. |
| Job enlargement | A type of non-financial motivation that takes place when more tasks or activities are added to a worker’s job description. |
| Job enrichment | Type of non-financial reward, involving enhancing the experiences of workers, giving workers a wide range of challenging tasks and more responsibility at work. |
| Job evaluation(HL only) | An assessment of the value of a job in relation to other jobs in the organization, so that the remuneration and other rewards can be determined in an objective, transparent and fair manner. |
| Job rotation | Type of non-financial motivation that involves workers switching between jobs (tasks) for a period of time. |
| Job security | The assurance given to employees that they will keep their current job for the foreseeable future, usually stated in an employment contract. |
| Labour turnover(HL only) | The amount of people who leave an organization, expressed as a percentage of the workforce, per time period (usually one year). |
| Mentoring | The training process of pairing, or attaching, an employee (the trainee or mentee) with a more experienced colleague (the mentor) who acts as a coach, trainer, or advisor. |
| Motivation | The intrinsic desire to do something, which exists when workers do something because they actually want to, rather than because they have to. |
| Motivators | Also known as growth factors, these factors address the higher-level needs in Herzberg’s motivation theory and are based around the job itself, e.g., achievement, purpose, and responsibility. |
| Off the job training | Type of training led by external specialists and takes place away from the place of work. |
| On the job training | Type of training that takes place within the organization, so employees are performing tasks at the place of work. |
| Performance-related pay (PRP) | Type of financial payment system used to pay people a bonus for reaching or exceeding a set target. |
| Person specification(HL only) | Document containing details of the attributes and qualities of the ideal person for a particular job, such as preferred qualifications, experiences, knowledge, skills, and personality. |
| Physiological needs | Also known as basic needs, these are the requirements for human survival in Maslow’s hierarchy of needs. |
| Piece rate payment | Financial reward system that pays workers based on their output or productivity, e.g., $8 per unit of output. |
| Productivity | Refers to the operational efficiency of employees by calculating levels of output per worker. The more motivated employees are, the more productive they will be. |
| Profit-related pay | Type of financial reward system which remunerates workers a certain percentage of the annual profits that the business earns. |
| Promotion(HL only) | The career advancement of an employee in terms of their hierarchical ranking and professional responsibilities. |
| Purpose | An intrinsic, non-financial type of motivation involving people doing genuinely meaningful work, making a difference on a personal, professional or social level. |
| Recruitment(HL only) | The process of hiring a suitable worker. This would typically involve a thorough job analysis in order to attract suitable candidates and then to selecting (hiring) the one(s) most suited to the job. |
| Recruitment process(HL only) | A major and vital aspect of human resource management, this refers to the procedures involved in the hiring of the right employees, with the right aptitudes and attitudes. |
| Remuneration | The overall financial package of a person, e.g., salaries, commission, profit-related pay, performance-related pay, share ownership schemes, and fringe benefits. |
| Retention(HL only) | The opposite of labour turnover, this measures the ability of an organization to keep its employees at the firm. |
| Safety needs | Also known as security needs, these are the requirements in Maslow’s hierarchy of needs that make people feel safe, such as job security. |
| Salary | Type of financial payment that rewards workers a fixed annual amount of money but paid in monthly instalments. |
| Scientific Management | F.W. Taylor’s theory of motivation, that people are, above all things, motivated by higher wages. Hence, there is one best way to motivate these employees. |
| Self-actualisation | This is the highest level of needs in Maslow’s hierarchy of needs, which occurs when people become the very best that they can be and fulfil their potential. |
| Self-appraisal(HL only) | A type of appraisal system that involves the individual employee reflecting on and rating his/her own performance against the pre-agreed standards. |
| Self-determination theory(HL only) | E. Deci and R. Ryan’s theory of motivation that suggests three key requirements to facilitate motivation in the workplace: autonomy, competence, and relatedness. |
| Summative appraisals(HL only) | Type of appraisal conducted periodically or at the end of a task or project, so includes an element of making a judgement about whether the appraisee has passed the agreed standards. |
| Shortlisting(HL only) | The process of employers selecting the most suitable applicants and inviting them for a job interview. |
| Social needs | Also known as love and belonging needs, this refers to the requirements in Maslow’s hierarchy of needs about being accepted by others. |
| Teamwork | A form of non-financial motivation, involving the combined efforts of a group of workers to achieve of an organizational goal. |
| Time-rate payment | Financial reward system that pays workers based on their time input in the production process, e.g., $10 per hour. |
| Training | The process of providing opportunities for employees to grow and develop by learning and acquiring employment-related skills, knowledge, and experiences. |
| Wages | Type of financial reward payment system based on time or output. Wages are paid as time rate (hours) or piece rate (output). |
Unit 2.6 Terminology
| Barriers to communication | Refers to the various factors that can prevent information being transferred effectively or accurately. |
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| Channel of communication | This refers to the method or means through which communications take place between the sender and recipient. |
| Communication | The transfer of information from one entity to another. It is vital to how well a business operates. |
| Cultural barriers to communication | These obstacles to effective communications stem from differences in social norms, beliefs, and values in different communities and countries |
| Electronic mail (email) | A form of written communication that uses computer wide area networks (WAN) as a mailing system. |
| External communication | Refer to communications conducted between stakeholders of one organization and another organization. |
| Formal communication | This refers to any method of communication through official channels of communication. |
| Jargon | Specialist or technical language used in different fields or professions in order to improve communications. |
| Informal communication | Also known as grapevine communication, this refers to any method of communication through unofficial channels of communication. |
| Internal communication | Refers to communications between stakeholders within the business organization. |
| Language barriers to communication | These obstacles to effective communications stem from miscommunications and misunderstandings due to language issues such as tones, jargon, slang, dialects, and accents. |
| Non-verbal communication | Refers to any form of communication other than oral (verbal) communication, such as email, letters, and body language. |
| Open channels of communication | Refers to any method of communication when information is not confidential and can be shared by and with anyone. |
| Oral communication | Also known as verbal communication, this refers to communication via the use of speech, such as appraisals, interviews, and meetings. |
| Organizational barriers to communication | These obstacles are caused by a lack of understanding of the internal functions and structures of the business, as well as the individual roles within the organization. |
| Psychological barriers to communication | Also referred to as emotional barriers to communication, these obstacles are caused by individuals with contrasting and conflicting mindsets, opinions, or priorities. |
| Restricted channels of communication | Also known as closed channels of communication, this refers to when information is confidential so need to be communicated formally to only those who need to know. |
| Transmission mechanism | The medium of communication or the method by which one party communicates with another. |
| Visual communication | A method of communication that relies on the use of visual stimuli to communicate information or ideas, such as infographics, charts, and images. |
| Written communication | A method of communication that relies on the use of texts, such as emails, letters, executive summaries, abstracts, notices, and reports. |