2.5 - Making human resource decisions

Question 1

2.5.1 - What is an organisational chart?

Answer 1

A diagram which shows the internal structure of an organisation.

Question 2

2.5.1 - What is a span of control?

Answer 2

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

Question 3

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - Through what means can people in a business communicate?

Answer 10

• E-mail
• Telephone
• Fax
• Text
• Messenger
• Twitter
• Written document

(Many more but just use common sense)

Question 11

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.1 - 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

2.5.4 - Why is motivation important in the workplace?

Answer 21

• Attracts employees: Meaning you have a larger recruitment and can easily find who you want to work for you
• Retains employees: Meaning your better workers will be staying and doing work for you
• Increases productivity: Meaning more money is able to be made

Question 22

2.5.4 - What are financial methods of motivating employess?

Answer 22

• Remuneration
• Bonus
• Commission
• Promotion
• Fringe benefits

Question 23

2.5.4 - What are non-financial methods of motivation?

Answer 23

• Job rotation
• Job enrichment
• Autonomy

Question 24

2.5.4 - What is a remuneration?

Answer 24

• Remuneration means money given to an employee in return for work or service.
• This may be employee’s wages, or salary or pay.
• To motivate some employees a business may decide to pay them more, to give them a “pay rise”

Question 25

2.5.4 - What is a bonus?

Answer 25

Extra money earned on top of salary for different situational reasons

Question 26

2.5.4 - What is a commission?

Answer 26

• Employee receives a reward for every sale made. (e.g. 10% of every sale they make).
• Some jobs are advertised with “OTE” which means on target earnings and gives the employee an idea of how much commission they can earn.

Question 27

2.5.4 - What is job promotion?

Answer 27

• It is important for a business to promote their staff.
• This keeps employees motivated as their earnings will go up with the new job.
• If a business promotes from within staff will remain more loyal to the business.

Question 28

2.5.4 - What are fringe benefits?

Answer 28

• Also known as ‘perks’
• Items an employee receives in addition to their normal wage or salary (e.g. company car, private health insurance, free meals)
• Often increases loyalty to company as these benefits are not always taxed or are taxed at a reduced rate
• More likely to recruit best people to company

Question 29

2.5.4 - What is job rotation and what are the advantages and disadvantages?

Answer 29

Employees are rotated between different jobs [wooaah no way] PROS:

• Relieves boredom
• Easy to find an employee to cover for an absent colleague
• More motivated due to wider range of skills

CONS:

• Training costs are high
• Fall in output due to less specialisation
• Could be simply a greater number of boring tasks with less social benefits due to constant changing of groups

Question 30

2.5.4 - What is job enrichment and what are the advantages and disadvantages?

Answer 30

Employees are given redesigned jobs that have more challenge and responsibility

PROS:

• Develops unused skills and challenges employees
• Allows employees to contribute to decision making process Increased feelings of achievement

CONS:

• Some employees may feel under pressure not simply challenged
• Costly
• Benefits only when thinking long term as employees have to be trained
• Not all jobs can be enriched (e.g. bin men [aww man that’s just rubbish])

Question 31

2.5.4 - What is autonomy and what are the advantages and disadvantages?

Answer 31

Autonomy means allowing employees to make their own decisions

PROS:

• Employees feel more ownership of their own work and so are more motivated
• Employees able to use their own thinking skills to complete their work at their pace

CONS:

• Some employees may become unhappy as they need more direction in their work and want recognition from their boss
• Some employees may want to make more decisions than they are entitled to.