3.2 Managers, Leaders and Decision Making

Question 1

Define Leadership

Answer 1

Leadership means taking the initiative to set clear objectives and motivate or guide staff towards their achievement.

Question 2

Define Management

Answer 2

Management means organizing and galvanizing staff to implement the strategies needed to achieve objectives.

Question 3

List the key features of management

Answer 3

Setting objectives
Analysing
Leading
Making decisions
Reviewing

Question 4

List the key features of leadership

Answer 4

Brave
Passionate
Willing to take risks
Driven
Organized
Confident

Question 5

What is an autocratic leadership style?

Answer 5

Autocratic managers are authoritarian, making decisions without consulting others. Better for when dealing with unskilled workers in a urgent situation. Demoivated employees

Question 6

What is a democratic leadership style?

Answer 6

Democratic managers encourage decision-making, listen to employees’ ideas, and promote discussion. This motivates employees and ensures contributions are valued. (Delegation)

Question 7

What is a laissez-faire leadership style?

Answer 7

Leaders give employees responsibility for decisions. It can lack direction but is useful for creativity and employee motivation. Only appropiate for small, highly motivated able workers.

Question 8

What is a paternalistic leadership style?

Answer 8

A paternalistic leader acts like a father, consulting employees on decisions and supervising them closely while addressing their social and security needs.

Question 9

What factors influence management style?

Answer 9

Internal:
- urgent or unexpected tasks may need an authoritarian leader for quick decision making.
- large, unskilled workers may also require an authoritarian leader, whilst small, educated workers may suite a democratic approach.

External:
- in a recession, an authoritarian or paternalistic leadership is needed to issue quick and clear demands
- when economy is growing democratic is good.
- increased competition could use democratic leaders to influence and inspire.

Question 10

What is the Tannenbaum Schmidt continuum?

Answer 10

The Tannenbaum and Schmidt continuum demonstrates the relationship between the level of freedom that a manager chooses to give a team, and the level of authority used by the manager.

Question 11

State and Explain the 6 terms used on the Tannenbaum Schmidt continuum

Answer 11

TELLS: Managers solely makes decisions and tells workers
SELLS: mangers make decisions but try to present it to the workers and let them ask questions but not influence.
SUGGESTS: decisions are outlined but they are allowed to discuss and ask questions to feel considered.
CONSULTS: manager provided provisional decisions and is open to change
JOINS: manager has a problem and allows a discussion for a solution. manager makes final decision
DELEGATES: manager outlines problem, team discusses and makes final decision
ABDICATES: team both defines and solves problem, manager still accountable so team has to be responsible

Question 12

What is the Blake and Mouton Grid and what does it show?

Answer 12

The Blake Mouton Managerial Grid is a tool that can help leaders identify their own leadership style and the style of their subordinates. The x-axis measures a leader’s concern for production while the y-axis of the grid measures a leader’s concern for people.

Question 13

State and Explain the different parts of the Blake and Mouton Grid

Answer 13

Impoverished
- low concern for ppl and production
- poor management leads to lack of motivation and low levels of productivity + failing quality
Produce or Perish (authoritarian)
- strict rules
- may demotivate employees and staff turnover
country club
- over concern with welfare but not productive
- doesn’t motivate to increase output
Team Leader
- ideal
- high concern for ppl and production
- happy/motivated workforce
middle of the road
-average concern for workers and needs of production

Question 14

state the types of decision making

Answer 14

scientific and intuition

Question 15

what is scientific decision making?
state adv and dis

Answer 15

• A systematic, data-driven approach to decisions.
• Uses analysis and logic rather than intuition.

Advantages: Reduces risk, improves accuracy.
Disadvantages: Time-consuming, may overlook qualitative factors.

Question 16

what is intuitive decision making?
state adv and dis

Answer 16

Relies on gut instinct or personal judgment instead of data analysis.
Common in fast-paced or uncertain situations.

Advantages: Quick, useful when data is unavailable.
Disadvantages: Riskier, may lead to errors due to lack of evidence.

Question 17

List and Explain all the factors that Influence decision making

Answer 17

Risk: Potential negative outcomes of the decision.
Reward: The potential benefits or gains from the decision.
Uncertainty: The unpredictability of external factors or future outcomes.
Opportunity cost: The benefits forgone from not choosing an alternative option.
Mission: How the decision aligns with the business’s overall purpose.
Objectives: Whether the decision supports specific, measurable goals.
Ethics: The moral implications of the decision.
External environment: Market conditions, competition, or economic factors influencing the decision.
Resource constraints: Limitations in finances, time, or personnel.

Question 18

What is a decision tree?

Answer 18

A diagram that helps businesses evaluate decisions by calculating expected values and considering the probabilities of different outcomes.

Question 19

what are the main components of decision trees?

Answer 19

Decision nodes (squares)
Chance nodes (circles)
Branches (lines)
Probabilities and payoffs for each outcome.

Question 20

What is the expected value of a decision tree?

Answer 20

The weighted average of possible outcomes, calculated using probabilities and payoffs.

Question 21

What are the advantages of using decision trees?

Answer 21

Logical, structured approach.
Visual representation of decisions.
Quantifies risk using probabilities and expected values.

Question 22

What are the disadvantages of using a decision tree?

Answer 22

Relies on accurate data.
May oversimplify complex decisions.
Probabilities can be subjective and biased.

Question 23

What is McGregor’s theory?

Answer 23

McGregor’s Theory X and Theory Y describe two contrasting views of human motivation at work

Question 24

What is the difference between theory y and x

Answer 24

Theory X suggests that employees are naturally lazy, dislike work, and need strict supervision, while Theory Y suggests that employees are motivated, enjoy work, and seek responsibility.

Question 25

State the major stakeholder groups and some of the needs that they might expect to have

Answer 25

shareholders:
- high dividends
- high share price
Employees:
- job security
- safe working conditions
- steady income
customers:
- high quality products at a low price
suppliers:
- fair prices
- paid on time
Local community:
- no noise pollution
- local employment
Creditors: (ppl the business owns money too)
- repayment of money owed at agreed date
- profitable returns on investments.

Question 26

What is stakeholder mapping?

Answer 26

A tool used to identify and prioritize stakeholders based on their power and interest in the business. Stakeholders are mapped on a grid with four quadrants:

High power, high interest (Manage closely)
High power, low interest (Keep satisfied)
Low power, high interest (Keep informed)
Low power, low interest (Monitor)
This helps businesses manage relationships effectively.

Question 27

What are overlapping and conflicting stakeholder needs?

Answer 27

Overlapping Needs: When stakeholders have similar goals (e.g., employees and customers wanting high-quality products). This can simplify decision-making.

Conflicting Needs: When stakeholders have opposing interests (e.g., shareholders wanting higher profits vs. employees wanting higher wages). This can complicate decision-making and requires balancing or compromising.

Question 28

What factors influence relationships with stakeholders?

Answer 28

Business Objectives: Goals like profit or sustainability shape relationships.
Management/Leadership Styles: Authoritative vs. participative leadership affects engagement.
Size & Ownership: Larger businesses and ownership types influence stakeholder interactions.
Market Conditions: Economic and industry trends impact stakeholder views.
Power of Stakeholders: Powerful groups (e.g., shareholders) influence decisions.
Government Policies: Laws and regulations affect business-stakeholder dynamics.

Question 29

What do businesses need to do to manage relationships with stakeholders?

Answer 29

Communication: Open, transparent communication and feedback mechanisms build trust.
Stakeholder Mapping: Identify and prioritize stakeholders based on power and interest.
Balancing Interests: Find ways to balance conflicting stakeholder needs and manage expectations.
Corporate Social Responsibility (CSR): Ethical behaviour and social responsibility improve relationships.
Flexibility: Adapt to changing stakeholder needs and market conditions.
Engagement Strategies: Use consultation and collaboration to involve stakeholders in decision-making.