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A Level Business Studies AQA > 3.2 Manager Leadership and Decision Making > Flashcards

3.2 Manager Leadership and Decision Making Flashcards

1
Q

What is a Stakeholder?

A

A stakeholder is an individual or group that has an effect on, and is effected by the activities of an organisation.

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2
Q

What is an ‘internal’ stakeholder; give examples?

A

Stakeholders inside a business; usually employees, directors, managers.

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3
Q

What is an ‘external’ stakeholder; give example?

A

Stakeholders that are outside a business; government, local community, pressure groups, media.

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4
Q

What are ‘connected’ stakeholders?

A

Connected Stakeholders have relationships with business, usually contracted; shareholders, customers, suppliers, competitors.

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5
Q

What would be the main interest of shareholder as a stakeholder in a business?

A

Profit Growth, share price growth, dividends.

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6
Q

What would be the main interest of banks and other lenders as a stakeholder in a business?

A

Interest and principal to be repaid, maintain credit rating.

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7
Q

What would be the main interest of directors & managers as a stakeholder in a business?

A

Salary, share options, job satisfaction, status.

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8
Q

What would be the main interest of employees as a stakeholder in a business?

A

Salaries and wages, job security, job satisfaction and motivation.

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9
Q

What would be the main interest of suppliers as a stakeholder in a business?

A

Long term contracts, prompt payment, growth of purchasing.

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10
Q

What would be the main interest of customers as a stakeholder in a business?

A

Reliable quality, value for money, product availability, customer service.

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11
Q

What would be the main interest of community as a stakeholder in a business?

A

Environment, local jobs, local impact.

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12
Q

What would be the main interest of government as a stakeholder in a business?

A

Operate legally, tax receipts, job creation (less population without job).

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13
Q

What are the four quadrants in stake holder mapping?

A
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14
Q

Why might it be helpful to a business to use stakeholder mapping?

A
  • people in charge of business make informed decisions
  • prioritise different stakeholders specifically to the type of business they run.
  • will focus on satisfying their top stakeholders,
  • ideally speaking this should allow good outcome for business.
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15
Q

Why might it be risky for business to focus solely on satisfying shareholders?

A
  • Ignoring power and requirements of other stakeholders, e.g. employees/suppliers
  • which are essential to running of business
  • detrimental in the long term.
  • foregoing needs/wants of other stakeholders.
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16
Q

Why might it be difficult for some firms to communicate effectively with their stakeholders?

A
  • may not have correct means of communication/skilled team that deal with interaction between stakeholders and business.
  • internal stakeholder (chain of command clash)
  • disparity with what they are willing to share versus what group wants to know.
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17
Q

Why might staff feel they should be treated as higher priority than other stakeholders?

A
  • staff are heart of business
  • (demotivated)
  • knock-on consequences.
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18
Q

Why might a new small company treat customers as their first priority? Key stakeholder?

A
  • need to create customer base.

- loyal customers that give enough revenue to get a place on market.

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19
Q

What does business ethics mean?

A

Business ethics refers to standards for morally right and wrong conduct in business
Business ethics enhance law by outlining acceptable behaviours.
They ensure good reputation for your company.

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20
Q

What are the four factors of production?

A

C: capital
E: enterprise
L: labour
L: land

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21
Q

What is a risk in a business environment?

A

A risk is an estimate of the probability of an unwanted outcome. Depends on chance of it happening.
And consequences if it did happen.

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22
Q

What is a reward in a business setting?

A

Profit, business success, independence.

23
Q

What is uncertainty in a business environment?

A

Uncertainty- situations in which businesses face risk that can’t be foreseen or measured.

24
Q

What is scientific decision making?

A

Scientific decision making is based on objective numerical data rather than intuition.

25
Q

What is intuitive decision making?

A

Intuitive Decision making relies on a ‘gut’ feeling rather than scientific evidence using qualitative data.
Often logical hunch.

26
Q

Which one is most preferred by firms: scientific or intuition decision making?

A

Scientific- there is a method that can be applied to making the decision and there is a way to measure the decision for opportunities or problems.

27
Q

When is scientific decision making unsuitable?

A

Some small organisations may not have enough data ti create decisions from.
May misinform.

28
Q

Advantages of Intuition Decision Making:

A
  • Quicker than data analysis
  • often gut instincts are correct and you over analyse data and sway away from it
  • data can be manipulated to say what you need it to, worth it?
29
Q

Advantages of Scientific Decision Making:

A
  • Shareholders expect you to back up decisions.
  • covering actions if questioned
  • analysis needs to be used to rationalise all decisions and reflect on them
  • removes personal influence and personality decisions that may be bias.
30
Q

What is a tactical decision?

A

Tactical decisions:
-decisions and plans that concern the more detailed implementation of director’s general strategy, usually with medium-term impact on a company.

31
Q

What is a strategic decision?

A

Strategic decisions:

  • made according to a company’s goals or mission. These decisions could take company into new directions
  • may or may not succeed.
  • long term decision making
32
Q

What is opportunity cost?

A

Loss of other alternatives when one alternative is chosen (the value of the next highest valued alternative.

33
Q

Benefits of using Decision Trees?

A
  • Choices set in logical way
  • Potential options considered at same time
  • use of probabilities enables ‘risk’ of options to be addressed.
  • likely costs are considered as well as potential benefits
  • easy to understand
  • tangible results.
34
Q

Drawbacks of using Decision Trees?

A
  • Probabilities are just estimates- prone to error
  • Uses quantitative data only- ignores qualitative aspects of decisions.
  • Assignment of probabilities and expected values prone to bias.
  • decision making technique doesn’t necessarily reduce amount of risk.
35
Q

Define Expected value:

A

Financial value of an outcome calculated by multiplying the estimated financial effect of its probability.

36
Q

Define Net gain:

A

The expected value of each outcome - the costs associated with decision.

37
Q

What is a manager?

A

A manager is an individual who organises and encourages staff to implement the strategies needed to achieve the business objectives.

38
Q

What do managers do?

A
  • Oversee day2day activities.
  • motivate
  • discipline
  • co-ordinate
  • set example
  • help out..!
39
Q

What should a manager do, according to Peter Drucker (1944)?

A

Peter Drucker (1944):
A manager should..:
1. set clear objectives that all staff believe in
2. find the right team (teamwork)
3. ensure all staff are motivated
4. prepare staff for change, make them adaptable through training.

Drucker is subordinated driven.

40
Q

What is the difference between a manager and a leader?

A

A manager is the individual who is encouraging staff to work and meet objectives.
More of a short-medium term thinker.
A leader creates objectives, they think ahead to future.

41
Q

Define Autocratic Leadership:

A
  • focus of power with manager
  • communication is top-down and 1-way
  • formal system of command and control
  • use of rewards and penalties
  • very little delegation.
  • consistent with McGregor theory X (managers who see employees as inherently requiring direction = coercion.
42
Q

Advantages of Autocratic Leadership:

A
  • quick decision making is guarenteed
  • good for inexperienced employees
  • decision making, planning or organising needs no initiative.
43
Q

Disadvantages of Autocratic Leadership:

A

-cause frustration and resentment because system is dependent on leader + non participation of workers.

44
Q

Define Democratic Leadership:

A
  • focus of power is more with group as a whole.
  • leadership functions shared in group
  • employees have greater involvement = delegation.
  • emphasis on delegation + consultation.
  • trade off between speed of decision making and better motivation and morale.
45
Q

Advantages of Democratic Leadership:

A
  • subordinates are consulted in decision making process - feel satisfied.
  • workers are aware of what is happening in organisation and take interest in producing more.
  • subordinates get full opportunity to utilise capabilities.
46
Q

Disadvantages of Democratic Leadership:

A
  • time consuming
  • requires long discussion
  • everyone tries to have say and mould situation according to their liking- hinders progress.
  • can turn into disastrous condition in times of crisis when urgent need of discipline + strong direction.
47
Q

Define Laissez-Faire Leadership:

A

-leader has little input in day2day decision making.
-full delegation to subordinates.
-effective when staff are ready and willing to take responsibility.
not the same as abdication.
-manager shirk responsibility
-employees inexperienced- dangerous to prosperity of business?

48
Q

Define Paternalistic Leadership:

A
  • leader decides what is best for employees
  • helps address employee needs
  • akin to a parent-child relationship
  • still little delegation
  • softer form of autocratic leadership.
  • in long term, same issues as autocratic.
49
Q

What are the 4 main styles of leadership identified by the Tannenbaum + Schmidt Continuum?

A

Tells, Sells, Consults, Joins.

50
Q

Describe the “Tells Leadership” in TSM:

A

Leader identifies problems, makes decisions + announces to subordinates, expects implementation,

51
Q

Describe “Sells Leadership” in TSM:

A

Leader makes decisions, attempts to overcome resistance through discussion and persuasion.

52
Q

Describe “Consults” in TSM:

A

Leader identifies problem + presents it to group. Listens to advice and suggestions before making decisions.

53
Q

Describe “joins” in TSM:

A

Leader identifies the problem + passes on solving and decision making to group (manager part of).

54
Q

Describe the Blake Mouton Managerial Grid:

A

A Level Business Studies AQA (10 decks)

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