3.2 - Managers, Leadership And Decision Making Flashcards
1
Q
Leadership
A
A relationship through which one person influences the behaviour or actions of other people
2
Q
What are the 2 different leadership perspectives
A
Traditional and modern
3
Q
What is the traditional leadership perspective
A
Command and control
Decision making
4
Q
What is the modern leadership perspective
A
Inspiring employees
Creating a vision
Shaping core values and cultures
Building effective teams
5
Q
What do managers do?
A
- setting objectives
- analysis data
- leading staff
- make decisions
- review the impact
6
Q
Why is leadership increasing important (2 reasons)
A
- changing organisational structures : greater delegation, teamwork, coaching and support
- rapid change : constant feature of business life, soft skills of leadership and management are increasingly important
7
Q
Strategic leadership
A
People who influence or control the corporate strategy of a business
8
Q
Where does strategic leadership occur?
A
Small firms and larger corporations
9
Q
How is strategic leadership demonstrated (4 ways)
A
Command - leaders take control
Vision - leaders set visions
Decision making - leader ways up options and decides
Symbolic - embodiment of strategy, not involved day to day
10
Q
Leaders attributes
A
- inspire people
- build relationships
- take risks
- have followers
11
Q
Managers attributes
A
- enact the plan
- use authority
- manage risks
- have subordinates
12
Q
How to tell the difference between managers and leaders
A
‘Managers do things right, leaders do the right things’
13
Q
3 levels of traditional management
A
Senior
Middle
Junior
14
Q
Senior management attributes
A
E.G. board of directors
- set corporate objectives and strategic direction
- board is responsible to shareholders, led by CEO
15
Q
Middle management attributes
A
- accountable to senior management
- runs business functions and departments
16
Q
Junior management attributes
A
- supervisory role, accountable to middle management
- monitor and control day to day tasks, and manage teams of workers
17
Q
What is a leadership style
A
The way that the functions of a leadership is carried out and the way that leader behaves
18
Q
4 types of leadership style
A
- authoritarian
- paternalistic
- democratic
- laissez-faire
19
Q
Authoritarian + example
A
- focus of power is with the managers
- communication is top down and one way
- formal systems of command and control
- use of regards and penalties
- very little delegation to employees
E.G. McGregor Theory X approach
20
Q
Paternalistic + example
A
- leader decides what’s best for employees
- like parent/child realtionship
- little delegation
- softer form of authoritarian
E.G. mayo
21
Q
Democratic + example
A
- focus of power is more with the group as a whole
- leadership functions are shared within the group
- employees have greater involvement in decision making
- emphasis on delegation and consultation
- trade off between speed of decision making and motivation and morale
E.G. McGregor Theory Y approach
22
Q
Laissez-faire + example
A
- leader has little input into day to day decision making
- conscious decision to delegate power
- mangers / employees have freedom to do what they think is best
- effect when staff are ready and willing to take responsibility
23
Q
Advantages of authoritarian
A
- use of rewards
- use of formal systems
24
Q
Advantages of paternalistic
A
- softer form of authoritarian
25
Advantages of democratic
- leadership functions are shared in group
- emphasis on delegation and consultation
26
Advantages of laissez-faire
- managers / employees have freedom to do what they believe is best
27
Disadvantages of authoritarian
- communication is one way
- very little delegation to employees
28
Disadvantages of paternalistic
- little delegation to employees
- leader makes all decisions still
29
Disadvantages of democratic
- lack of effective
- leadership could lead to split decisions
30
Disadvantages of laissez-faire
- lack of complete leadership
- could lead to confusion amongst what to do with so math people leading
31
2 major group types in the McGregor theory
Theory X
Theory Y
32
Theory X managers summary
- average worker is lazy and dislikes work
- works need to be controlled and directed
- centralised organisation
- exercise of authority
33
Theory Y managers summary
- most people enjoy work
- workers take responsibility and organise themselves
- decision making can be delegated
34
Why is modern business leadership moving away from authoritarian
- changes in societies values
- better educated workforce
- focus on need for soft HR skills
- changing workplace organisation
- greater workplace legislation
- pressure for greater employee involvement
35
Tannenbaum and schmidt continuum
Continuum of leadership behaviour, represents a range of action related to the degree of authority used by managers and area of freedom available to non managers
36
Tells leadership style
Leader identify problems, make decisions and announces to subordinates and expects implementation
37
Sells leadership style
Leader still makes decisions but attempts to overcome resistance through discussion and persuasion
38
Consults leadership style
Leader identifies problem and presents it to the group, they listen to advice and suggestions before making final decision
39
Joins/shares leadership style
Leader defines the problem and passes on the solving / decision making to the group (manager can be apart of)
40
Advantages of tells
Quick, leader makes decisions and tells others
41
Disadvantages of tells
- Dictator mentality
- Employees lack motivation and are less engaged now
42
When might tells be used
When an issue needs to be resolved fast
43
Advantages of sells
- Employees have slight more input
- Useful
- Limits doubt over task
44
Disadvantages of sells
Ineffective if discussion doesn’t work
45
When might sells be useful
High task / high relationship
46
Advantages of consults
Democratic, everyone has a say
47
Disadvantages of consults
People may disagree, cause leader to pick anyways
48
When might consults be used
More in-depth issue needing to be discussed
49
Advantages of joins/shares
Employees have free decision making
50
Disadvantages of joins/shares
- take a long time
- could cause issues/confusion
51
When might joins/shares be useful
Group decision task, perhaps whole company vote/decision
52
Factors effecting leadership styles
- personal value systems
- managers experience
- confident insubordinates
- feeling of security
- nature of the business problems
- organisational culture and tradition
- pressure (time/costs)
- effectiveness teams and groups
53
Explain the Blake Mouton Managerial Grid
- identifies 5 different leadership styles based on a grid which has 2 axis measuring:
- concern for people (y-axis)
- concern for completing task (x-axis)
54
What is a decision tree
A mathematical model used to help managers make decisions using estimates and probabilities to calculate likely outcomes to help decide wether the net gain from a decision is worthwhile
55
Probability
The % chance or possibility that an event will occur and all the outcomes must total to 1.
56
Expected value
The financial value of an outcome calculated by multiplying the estimated financial effect by its probability
57
Net gain
Value to be gained from taking a decision. Calculated by adding together the expected value of each outcome and deducting the costs associated with the decision
58
2 broad approaches to decision making
Hunch
Scientific
59
Hunch decision making
- based on intuition, get and feel experience
- key benefit : quick
- hard to justify for business decisions involving significant risk
60
Scientific decision making
- based on data and analysis
- downside : time consuming and costly
- increasingly common and automated, supported by big data and data analytics
61
How to make a decision
1. Set objectives
2. Gather data
3. Analyse data
4. Select a strategy
5. Implement decision
6. Review
62
Opportunity cost
Cost of missing out on the next best alternative, the benefits that could have been gained by taking a different decision
63
Why are opportunity costs important
- most start up resources are limited for businesses
- when resources are scarce, decisions about where to spend money are risky
- people take calculated risks and weigh up the potential implications of decisions before choosing what’s best for the business
64
Advantages of decision trees
- choices are set in logical ways
- potential options and choices are considered at the same time
- risk with probabilities
- likely costs are considered as well as potential benefits
- easy to understand and tangible results
65
Disadvantages of decision trees
- probabilities are just estimates and prone to error
- uses quantitative data and ignores qualitative aspects of decisions
- doesn’t necessarily reduce the amount of risk
66
Stakeholder
Any individual or organisation who has a vested interest in the activities and decision making of the business
67
Footfall
Amount of people who come into the store, helps show data and market research
68
Shareholders
Owns the business and may also work in the business
69
Examples of stakeholders
Customers
Suppliers
Government
Competitors
Trade union
Media
Banks
Locals
Competitors
70
Examples of internal stakeholders
Employees
Shareholders / owners
71
Examples of connected stakeholders
Customers
Suppliers
Creditors
72
Examples of external stakeholders
Competitors
Government
Society / the wider community
73
What is a shareholders / owners interest
Return on investment and profits and dividends, success and growth of the business, proper running of the business
74
What is a managers / employees interest
Rewards, basic pay and other financial incentives, job security and work conditions, promotion opportunities and job satisfaction and status motivation, roles and responsibilities
75
What is a customer’s interest
Value for money, product quality and customer service
76
What is a suppliers interest
Profitable trade with the business and financial stability
77
What is a banks / other financial providers interest
Can the business repay amounts loaned or invested, profitability and cash flows of the business, growth in profits and values of the business
78
What is a government interest
Correct collection and payment of tax, help the business grow - creating jobs, compliance with business legislation
79
What is a local community interest
Success of the business - creating and retraining jobs, compliance with local laws and regulation (noise pollution)
80
Functions in order of increasingly strategic - top (most strategic) to bottom (least strategic)
Mission
Strategic / corporate
Functional
Team
Individual
81
Functions in order of increasingly detailed - top (most detailed) to bottom (least detailed)
Individual
Team
Functional
Strategic / corporate
Mission
82
Functions of the business
- Human Resources
- Finance
- Operations
- Marketing
83
Functions of corporate
- profit maximisation
- survival
- growth
- cash flow
- social / ethical
84
How to decide when stakeholder mapping
1. Level of interest might motivate them to take action
2. The extent to which the stakeholder may have power to influence the organisation
85
What are the 3 key marketing measures
- market size
- market growth
- market share
86
Sales volume
Number of items sold or produced
87
Sales values
Financial worth of items sold
88
Sales values calc
Number of items sold x average price
89
Market size
Potential sales for a firm, usually measured in terms of both volume (units) and values (sales). The size of the individual segments within overall market can be measured. Not normally a marketing objective, a firm cannot influence it.
