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Unit 2 -- Managers, leadership and decision making - Coggle Diagram

- - - - Decision making is made at the top and orders are sent down the chain of command.
      - Employees have very little say in how the business is run and there is very little delegation.
      - Links to Taylor's theories on motivaton.
    - - This is a softer form of leadership then autocratic, but the decision making is still made at the top and there is little delegation.
    - - Employees are given more of a say in decision making as managers work with employees to help the business.
      - There is a greater amount of delegation.
      - This method of management sacrafices some speed in deciosn making to improve motivation and moral within the business.
      - This links to Maslow's and Herzberg's theories on motivation.
    - - This system makes great use of delegation and employees have a great amount of freedom in decision making.
      - Can only be used when employees are mlotivated and highly skilled.
      - This is a common management technique within the tech industry.
  - - - Businesses over a certian size (50 employees) must have work councils.
      - Businesses must recorganise trade unions if 40% of employees support recorgnising the trade union.
    - - Service sector jobs such as in offices are more likely to run a more democratic leadership style to seccondary sector jobs as more autonomy can be given to the employees.
  - - - Tell
        
        Manager tells employees what is going to happen and they are expected to comply.
        
        Autocractic
        
        Can reduce employee motivation as they feel they have no freedom.
      - Sell
        
        The manger still makes the decision, but instead of dicating the decision they try and convince employees it is the right decision.
        
        There is more freedom then in tell as employees may ask questions of the decision, but the manager still calls the shots.
      - Suggest
        
        Managers will present decisions to the workforce for them to discuss and ask questions. It is simlar to selling.
        
        This helps motivation as employees feel they are listened to.
      - Consults
        
        The manager will propse the core of a descion and will let employees discuss and modify the proposal.
        
        This helps the management use the skills and expertise of their employees and helps maintian morale within the business as employees feel listend to.
      - Joins
        
        A manager will propose a problem that the business faces and the workforce work together to to solve the problem, ultimatly the manager will make the final decision, but there is greater employee involvement.
        
        This is commonly used when employees have specfic knolledge that could help the manager.
      - Delegates
        
        The manager will present the problem and the team will debate and make the final decision, but acountablity still rests on the manger.
        
        Close to laissez faire management as the management must have a high level of trust in the workforce to make the right decisions.
      - Abidcate
        
        The team define and solve the problem in this form of management and using this form of management shows a high level of trust between management and employees that should boost motivation.
        
        Management is still acountable.
  - - - High concern for people, low concern for production
      - This system of management is accomadating with very little pressure to meet targets and the workplace is very social.
    - - High concern for production, high concern for people
      - This management is much more team based, the aim is to achieve production goals as a team and employees are treated as core assets.
    - - Meduim concern for production, meduim concern for people
      - There is a comprise between production and people with the business not aiming solely for profit, but not letting profits fall to much.
    - - Low concern for people, low concern for production
      - This management style sees the managers blame others, with little concern for people or the project and the manager avoids responsibility.
    - - Low concern for people, high concern for production
      - This makes use of a produce for perish style of management where orders must be followed and employees are treated as a resource.
- - - - Based on intuitation/gut feeling
      - Quick
      - Hard to justify for business decisions with high risk
    - - Based on data and analysis
      - Increasing common and automated due to AI and big data.
      - Slow and it still deosn't gaurntee the right decisions were made
      - The role of big data
        
        Real time data catures customer transactions and preferences.
        
        Helps respond to real time changes in the market, e.g dynamic pricing.
        
        Enables more market research as more customers can be reached.
        
        Can help with inventory control (automated reordering).
    - - Business objectives and mission
        
        This will alter how decisions are made because the decisions must fit fulling objectives.
      - Organistional structure
      - Attitude to risk (more willing to take risks = hunch based)
      - Availability and relaibility of data (poor data may make scientific decision making pointless)
      - External enviroment (PESTLE)
      - Tactics v strategy
        
        Tactics -- short term
        
        Strategy -- long term
      - Ethics
        
        A decision made on ethical grounds may occur at the sacrafice of profit (but it may be good pr).
      - Available resources
  - - - For all businesses resources are limited and this means they need to be used wisely.
      - Entrepeneurs and managers need to take calculated risks and wiegh up the potential implications of decisions.
  - - - Pros
        
        Choices are set out in a logical way.
        
        Choices are easily comparible.
        
        Use of proabilities enables the risk of the option to be assessed.
        
        Can compare cost and profits.
        
        Easy to understand.
      - Cons
        
        Probabilities are just estimates.
        
        Only uses quantative data.
        
        Proability and expected value can be subject to bias (if a manager supports one decision they may wait the numbers in its favour).
        
        Doesen't necessarily reduce risk.
- - - - These are people within the business such as employees and shareholders.
    - - These are people who are linked to the business through contracts these include customers, suppliers and creditors.
    - - These are people with no legal connection with the business and include government, competition and the local community.
  - - - High power, high interest
        
        Manage closely -- these are important stakeholders and the business must keep them onside.
      - High power, low interest
        
        Keep informed -- these are likely secondary stakeholders who have high levels of interest and innovling these in decison making can be good PR.
      - Low power, high interest
        
        Keep statisfied -- these are powerful people, but hold little interest in the business and so they could become inflentual if they chose to. It is best to consult them so as to increase their interest.
      - Low power, low interest
        
        Monitor -- a lack of power and interest means that this group needs only to be paid the bare mnimum amount of interest.
  - - - Business objectives
      - Management and leadership styles
      - Size and ownership of the business
        
        Small businesses will have fewer stakeholders making it easier to communicate with them.
        
        LTDs (businesses owned by people close to the founder) are likely going to be less focused on shareholders as these shareholders will be close to the leadership.
    - - Market conditions
        
        A business that is facing intense competion may increase their focus on customers so as to keep as many customers as possible.
      - Power of stakeholder groups
      - Government policy
        
        The governemnt passes laws and produces codes of conducts to regulate how businesses interact with different groups.
  - - - This method enages the stakeholders the most ensuring that their views and opinions are reflected in decision making.
      - A partnership may mean that decisions are taken jointly by the management team and relevant stakeholders.
      - This ensures two way communication.
      - This is best used to handle powerful and interested stakeholder groups.
    - - This can be described as paternership light, as stakeholders are still part of the discusion and may have responsibility for some of the decision making.
      - This will also ensure strong two way comunication.
      - Best suited for groups that have a high level of power, but low level of interest.
    - - Stakeholders have limitted power to shape decision making and instead are simply asked to contribute ideas and thoughts.
      - This innolves some two way communication, but it is a lot weaker.
      - This is best used when stakeholders have high interest, but low power.
    - - This form of engagement inolves one way communication from the business to the stakeholders.
      - This is used to communicate with stakeholders that have a low level of interest and a low level of power.
    - - This form of communication is where stakeholders reach out and engage with the business.
      - This is used for stakeholders with low power and low interest.
      - Infomation conveyed this way is likely to have little impact on stakeholders.