2.5 making human resource decisions

Question 1

What is an organisational chart?

Answer 1

A diagram which shows the internal structure of an organisation.

Question 2

What is a span of control?

Answer 2

The number of people who report directly to another worker in an organisation.

Question 3

What is a chain of command?

Answer 3

The path down which orders are passed.

In a company, this goes from the board of directors down to other workers in the organisation.

Question 4

Why is it beneficial to have a structure in a business?

Answer 4

All businesses have to organise what they do
A clear structure makes it easier to see which part of the business does what, and who has which job role
Makes communication easier across the company
Employees should find it easier to be aware of their roles and responsibilities

Question 5

What is delegation?

Answer 5

Delegation is where a task is given to a subordinate (lower) employee in the hierarchy
Good managers are good at delegating tasks to the right employees
A task that has been delegated may have a deadline so managers can see if the task has been completed on time

Question 6

What is a hierarchical structure?

Answer 6

Tall and thin structure
Small span of control and long chain of command
Lots of layers with few people on each layer

Question 7

What are the benefits and limitations of a hierarchical structure?

Answer 7

PROS:

Lots of layers in the hierarchy means lots of opportunities for promotion (motivation)
Supervisors normally have a small span of control so they can get to know their subordinates really well
Knowing subordinates means they can delegate the right tasks and make sure their team is well trained
​CONS:

Lots of layers and a long chain of command can mean that the business is very inflexible
It can also mean that communications within the organisation are slow
This is expensive as there are more managers and supervisors

Question 8

What is a flat structure?

Answer 8

Short and fat
Wide span of control and and short chain of command
Few layers with lots of people on each

Question 9

What are the benefits and limitations of a flat structure?

Answer 9

PROS:

​Fewer layers of hierarchy between the bottom and the top of the organisation may mean that communication is fast
Lots of delegation means that staff are given greater responsibility, which might mean more opportunities to use their abilities
CONS:

Staff can be overstretched or overworked in a flat structure as there is less supervision, this can cause stress and demotivation
Can create a power struggle if the manager is rarely around as subordinates jostle for roles and responsibilities
Wide span of control means managers have too many staff to manage and may lose touch with them and delegate poorly

Question 10

Through what means can people in a business communicate?

Answer 10

E-mail
Telephone
Fax
Text
Messenger
Twitter
Written document

Question 11

What are the pros and of a centralised structure?

Answer 11

A centralised structure is when all of the decision making is controlled by a few people (or even one person)

PROS:

Quicker decision making
Easier to co-ordinate
Economies of scale
Easier to implement policies
CONS:

Customer service experiences inflexibility
Lack of manager motivation

Question 12

What are the pros and of a decentralised structure?

Answer 12

A decentralised structure is one where decision making is spread throughout most if not all employees

PROS:

Flexible decisions with situational understanding
Improves customer service
Good way of training juniors
Should improve motivation
CONS:

Decisions aren’t ‘strategic’ (long-term beneficial or rational)
Consistency is hard to achieve
No strong leadership in crisis
Hard to have tight financial control

Question 13

Why is communication important for a business?

Answer 13

Motivates employees
Easier to control and coordinate business activity
Makes successful decision making easier

Question 14

What are the problems with insufficient communication?

Answer 14

If communication skills are poor, employees lack enthusiasm in doing their work
Poor business communication skills will also demotivate the employees
They are provided with unclear instructions on projects, leading to confusion and boredom

Question 15

What are the problems with excessive communication?

Answer 15

Can lead to workers not getting to important information
Can be confusing and stressful leading to demotivating workers
May put off potential employees and reduce retainment

Question 16

What are some barriers to effective communication?

Answer 16

Overload: Too much information reduces chance of important information getting through
Structural layers: Too many structural layers can mean that messages get altered as they travel up/down
Inconsistency: Conflicting messages can lead to confusion of what decision to make

Question 17

What are the three ways you could work (in terms of time)

Answer 17

Full time: Working the whole working week
Part time: Working a fraction of the working week
Flexi-hours: Spreading out a certain amount of time at work as you please

Question 18

What are the three types of ways to work (in terms of contracts)?

Answer 18

Permanent: With a contract to work for the foreseeable future
Temporary: With no permanent contract
Freelance: Workers who tend to be self employed and do particular pieces of work for a business as a supplier.

Question 19

How has technology affected ways of working?

Answer 19

It has allowed for better efficiency in working and communication It also allows people to work form home

Question 20

What are the pros and cons of remote work (work from home)?

Answer 20

PROS:

Fit a business round a family, gives a good work-life balance
The owner can work hours that suit their lifestyle
No commute, so reduction in costs of travelling
No expensive premises to pay for, so a reduction in fixed costs
Less stress from travelling and tension with colleagues
CONS:

No socialisation with other workers, so business owner may not have anyone to bounce ideas off
Work is all around the business person so they may find it hard to switch off
The business owner may find that they work more hours than a regular job as they don’t keep track of the time that they work
Needs lots of self discipline to avoid distractions
Too easy to be lazy and not work

Question 21

What are the directors of a business?

Answer 21

A board of Directors in a business makes strategic decisions
Directors have a responsibility to run a business so that it is successful for all its stakeholders, not just shareholders
Sometimes they must take difficult decisions, when times are hard, to withhold a dividend or to pay a low one, because using a small profit for this may cause long-term problems for the business