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Section 2 = people in business, financial methods, Maslow's Hierarchy…
Section 2 = people in business
INTERNAL AND EXTERNAL COMMUNICATION
COMMUNICATION is the transferring of a message from the sender to the receiver, who understands the message.
INTERNAL COMMUNICATION is between two members of the same organisations. Example: communication between departments, signboards and labels inside factories and offices etc.
The advantages of internal communication
While internal communications have a strong impact and influence on employees, external communications have it on current and potential customers. Therefore, communications departments can connect people from within and outside the company to create great stories
Improve Employee Alignment
Build Trust. ...
Increase Engagement
Improve Employee Performance
Improve Brand Image
Better Crisis Management
Decrease Security Risks
Increase Feedback and Whistleblowing
EXTERNAL COMMUNICATION is between the organisation and other organisations or individuals. Example: orders of goods to suppliers, advertising of products, sending customers messages about delivery, offers etc.
Advantages of external communication
•Because the goal of external communications is to promote the company and increase revenue, external communications are an important part of an overall marketing plan.
•Spreading the News
•Define the Public's Perception
•Reach New Customers
•Expensive is You Get It Wrong
TYPES OF COMMUNICATION
ONE WAY COMMUNICATION involves a message which does not require a feedback. Example: signs saying ‘no smoking’ or an instruction saying ‘deliver these goods to a customer’
TWO WAY COMMUNICATION is when the receiver gives a response to the message received. Example: a letter from one manager to another about an important matter that needs to be discussed. A two-way communication ensures that the person receiving the message understands it and has acted up on it. It also makes the receiver feel more a part of the process- could be a way of motivating employees.
DOWNWARD COMMUNICATION: messages from managers to subordinates i.e. from top to bottom of an organization structure.
Advantages of downward communication
•organizational discipline
•some efficiencies goal explanation and ease of delegation
The Disadvantages of downward communication
• include message distortion
•slow feedback
•interpretative problem
•lower morale and the fact that it's
UPWARD COMMUNICATION: messages/feedback from subordinates to managers i.e. from bottom to top of an organization structure
Advantages of upward communication
•Good Relations.
•Providing Counsel.
•Favorable Organizational Environment.
•Knowing Employee Attitude.
•Feedback.
•Prompt Appreciation.
•Decision Making.
•Development of Creativity.
Disadvantage of upwards communication
•Subordinate provides only that information which is favourable to upper management.
•It may be discouraged due to lack of proper response of top management.
•It takes a lot of time to communicate the problems at higher level due to various levels from which it has to pass.
HORIZONTAL COMMUNICATION occurs between people on the same level of an organization structure.
Advantages of horizontal communication
•Promotes teamwork and a company-wide sense of unity.
•Decreases misunderstandings because the same information is shared with everyone.
•Improves problem-solving skills and boosts creativity.
•Makes it easier to coordinate teams and tasks.
•Helps employees feel empowered.
Disadvantages of horizontal communication
include the possibility of decreased managerial control, interpersonal conflict, increase in time consumption if vertical communication is required and the possibility of a decline in discipline.
COMMUNICATION METHODS
Verbal methods (eg: telephone conversation, face-to-face conversation, video conferencing, meetings)
ADVATAGES
Quick and efficient
There is an opportunity for immediate feedback
Speaker can reinforce the message- change his tone, body language etc. to influence the listeners.
DISADVATAGES
Can take long if there is feedback and therefore, discussions
In a meeting, it cannot be guaranteed that everybody is listening or has understood the message
No written record of the message can be kept for later reference.
Written methods (eg: letters, memos, text-messages, reports, e-mail, social media, faxes, notices, signboards)
ADVANTAGES
There is evidence of the message for later reference.
Can include details
Can be copied and sent to many people, especially with e-mail
E-mail and fax is quick and cheap
DISADVANTAGES
Direct feedback may not always be possible
Cannot ensure that message has been received and/or acknowledged
Language could be difficult to understand.
Long messages may cause disinterest in receivers
No opportunity for body language to be used to reinforce messages
Visual Methods (eg: diagrams, charts, videos, presentations, photographs, cartoons, posters)
ADVANTAGES
Can present information in an appealing and attractive way
Can be used along with written material (eg: reports with diagrams and charts)
DISADVANTAGES
No feedback
May not be understood/ interpreted properly.
Factors that affect the choice of an appropriate communication method:
SPEED, COST, MESSAGE DETAILS, LEADERSHIP STYLES, THE RECEIVER, IMPORTANCE OF A WRITTEN RECORD AND IMPORTANCE OF FEEDBACK.
IF YOU DON'T WANT TO READ THIS, I COPIED IT ALL FROM THIS WEBSITE:
https://igcseaid.com/notes/business-studies-0450/2-4-internal-and-external-communication/
Organisation and management
Types of organisation
limited liability organizations
Partnership
partners in partnerships may have liability for obligations of the partnership if they are general partners.
Corporations
A corporation is totally separate from its owners, so they have limited liability
unlimited liability organizations
sole proprietorship
A sole proprietorship is when an individual has total control over a business. Because the individual and the business constitute one legal entity.
General partnership
A general partnership consists of two or more people who have agreed to go into business together. Unless the partnership agreement states otherwise, the partners share equally profits and losses of the business
types of management
Democratic
Democratic leadership is known as participative leadership style in which member of the group take a more participative role in the decision-making process.
Advantages of democratic
Managers can feel that that decisions have the support of employees.
Employees are likely to be motivated as their views are listened to.
This style encourages loyalty as it gives responsibility to the employee.
Disadvantages of democratic
Decision-making can be slow.
Problems can arise if employees do not have enough knowledge or experience to make decisions.
The manager might not agree with the decision but has to accept it.
Laissez faire
laissez-faire leaders have an attitude of trust and reliance on their employees. They don't micromanage or get too involved, they don't give too much instructions or guidance.
Advantages of laissez-faire
People can be more motivated as they are free to do what they think best.
Encourages loyalty as it gives responsibility to the employee.
Employees can use all their for the benefit of the business.
Disadvantages of laissez-faire
There is no real direction as all do what they think is right.
Poor coordination can lead to inefficiency.
This style can lead to conflicts between team members.
Autocratic
Autocratic is a leadership style characterized by individual control over all decisions and little input from group members
Advantages of autocratic
The manager feels in control of all situations.
Quick decision making.
Employees have clear direction, and the know what to do and expect.
Disadvantages of autocratic
Motivation can be a problem as employees do not feel involved in decisions.
Employees can be too dependent on the manager.
No scope for individuals to develop skills
Management is very important because it makes our life effects more productive and brings better technology, products and services to our society. Organization is important too, because organizations are systems created to achieve common goals through people-to-people and people-to-work relationships. Organizing creates the framework needed to reach a company's objectives and goals.
Trade union
Trade union is a group of employees who join together to protect the interests of its members
Benefits
Negotiate with employers for better pay.
Provide additional services and social facilities.
Provide legal advice and support.
Negotiate with employers for better working conditions.
Drawbacks
Employees have to pay membership fees to the union.
Individual members are bound by the decisions of the majority, even if they don't agree with them.
Employees will lose wages during any strike action.
Unions can fine or take action against members who break union rules.
Role of management
Main functions of management
PLANNING- set targets and decide what is the best way to achieve them.
ORGANIZING- give orders or delegate tasks to appropriate employees.
COMMAND- motivate, communicate, guide and encourage, as well as give orders.
COORDINATE- communicate, supervise and give direction to subordinates.
CONTROL- set standards and make sure everything is done correctly and on time.
ORGANISATIONAL STRUCTURE- the formal, internal framework of a business that shows how it is managed and organized.
DELEGATION- passing responsibility to perform tasks to employees lower down in the organization.
The importance of delegation
GOOD MANAGERS NEED TO KNOW
What to delegate
When to delegate
Who to delegate to
Tasks can be delegated if they can be completed accurately and safely by someone else in the organization on time and to the required standards.
They should only be delegated to someone that is
:
Competent
Qualified
Authorised to do the task
Bad delegation
No trust
No specific task
Not listening to your employees
Recruitment, selection and training of workers
a job description is prepared that outlines the responsibilities and duties to be carried out by someone employed to do the job.
recruitment (job analysis, description and specification)
https://igcseaid.com/notes/business-studies-0450/2-3-recruitment-selection-and-training-of-workers/
website
job specification, a document that outlines the requirements, qualifications, expertise, skills, physical/personal characteristics etc. required by an employee
Internal recruitment
- a vacancy is filled by an existing employee of the business.
advantages of recruitment
Saves time and money- no need for advertising and interviewing
Person already known to business
Person knows business’ ways of working
Motivating for other employees to see their colleagues being promoted- urging them to work hard
No new skills and experience coming into the business
Jealousy among workers
disadvantages of recruitment
recruitment vocab
External recruitment
- a vacancy is filled by someone who is not an existing employee and will be new to the business.
curriculum vitae (CV) or resume
- this will detail the person’s qualifications, experience, qualities and skills. The business will use these to see which candidates match the job specification.
financial methods
disadvantages
the worker can become spoiled and lazy
control and maniplulate
increase pressure
not caring about teamwork
demotivated employees to no motivate with other employees
decrease sense of teamwork
more competitive employees
advantages
more wages
gets more profits shared
more money for the business
greater sense of employees
increasing employees payments
giving some type of money related reward
Financial rewards are :
hourly wage rate
Salary
Piece-rate and commissions
Bonus schemes
Fringe Benefits
Profit sharing
Motivating Workers
Maslow's Hierarchy of Human Needs
3 Motivation Theories
F.W Taylor - Scientific Management Theroy
Aims to reduce inefficiency by finding the quickest way to do a task
Taylor believe that employees are only motivated by money
uses money to increase employee effort
piece rate method
employees paid a fixed amount but the harder they work = more money
Advantage :
increased efficiency
decreases inaccuracy
managers have good control overproduction
Disadvantages :
requires huge capital
planning reduces productivity
Time consuming
[ use this to see Maslow's Hierarchy diagram and for further information]
(
https://igcseaid.com/notes/business-studies-0450/2-1-motivating-workers/
)
Maslow believed there were 5 level of needs
(1 = highest level on hierarchy
5 = lowest level on hierarchy)
3.Social needs - friendship, accepted, belonging to a group
Safety needs - health and safety at work, job security, free from threats
2.Esteem needs - respect from others, recognized for doing well, status
Physical needs - water, food, shelter, clothing, rest
Self - actualization - to reach one's potential
Once a need has been satisfied, it is no longer a motivator, you move up the level of needs.
Advantage :
once employee is motivated it increases efficiency
employees will produce better quality goods and services
improve competitiveness and help reduce business cost
Disadvantage :
not everyone has the same needs as the needs in Maslow hierarchy
Money may be needed to satisfy needs
difficult to know what needs has been met and which level each employee is on
benefits of well motivated employees
improved quality and customers service
improved work performance
friendly relationship between employees
employees focuses with work
increase teamwork
increasing skills which can lead to success
Fedrick Herzberg - Two - Factor theory
Herzberg's research identified 2 groups of factors, hygiene factors and motivators
Hygiene Factors :
working conditions
Relationship with others
Salary or wage
Supervision
Company policy and administration
these factors must be at a level that is acceptable to employees to prevent job dissatisfaction.
advantage :
makes job dissatisfaction less likely
disadvantage :
does not motivate employees to work more efficiently
Motivators :
The work itself
Responsibility
Advancement
Achievement
Recognition of achievement
advantage :
managers can use one or more motivators to increase motivation
disadvantage : - needs acceptable level of hygiene factors for motivators to work and prevent job dissatisfaction
employees are dissatisfied and demotivated → hygiene factors → employees are not dissatisfied but are not motivated → motivators → employees are satisfied and motivated
Non- Financial Methods
how to motivate employees non financially
let them in on the vision
assign them to leadership roles
organize social gatherings out of the workplace
applaud employees for their complishments
Non financial methods of motivation involve motivating employees in ways that don't involve money
Non financial method of motivation include
job rotation
involves workers swapping around jobs and doing each specific task for only a limited time and then changing round again.
job enrichment
involves adding tasks that require more skill and responsibility to a job.
training
job enlargement
job enlargement involves employees being provided with additional tasks as part of their daily role
for example a shop worker may work on both the tills and stacking
advantages of non financial methods
developing additional skills
having more control of tasks and duties
having more flexibility in how a role is carried out
enhancing knowledge
disadvantages of non financial methods
short term fix
high expectations
not structured
always left wanting more
non financial motivators
examples are
Fringe benefits are non-financial rewards given to employees
Company vehicle/car
Free healthcare
Children’s education fees paid for
Free accommodation
Free holidays/trips
Discounts on the firm’s products