3.4 influences on business decisions Flashcards
1
Q
what does corporate decision making involve?
A
- timescale
- ethics
- corporate culture
- stakeholder perspectives
2
Q
what are short term perspectives likely to focus on?
A
- maximise short term profits
- invest less in R&D and training
- return profits to shareholders
- pursue external growth strategies
3
Q
what are long term perspectives likely to do?
A
- invest in R&D and training
- focus on profit quality
- take an ethical stance on decision making
- pursue the interest of stakeholders
4
Q
what is corporate culture?`
A
- includes the traditions, rituals, attitudes and values that make up the way a business is run
5
Q
what are benefits of a strong culture?
A
- a sense of identity
- a sense of togetherness
- improved commitment from employees
- motivation
- reinforces the values and beliefs
6
Q
what 4 distinct organisational cultures does Charles Handy identify?
A
- power culture
- role culture
- task culture
- person culture
7
Q
what is power culture?
A
- a few people drive the organisation and decisions
8
Q
what is role culture?
A
- people associate with a team or function
9
Q
what is task culture?
A
- employees associate with a task or project
10
Q
what is person culture?
A
- employees have a great deal of independence
11
Q
reasons for changing organisational culture?
A
- a new leader
- poor performance
- corporate objectives
- customer needs
12
Q
what are the problems changing culture?
A
- long process
- large organisations may have more than one culture
- culture is deep set
13
Q
who are stakeholders?
A
- groups or individuals who have an interest in a business
14
Q
who are internal stakeholders?
A
- employees
- shareholder
- managers
15
Q
who are external stakeholders?
A
- suppliers
- customers
- local communities
16
Q
what is the shareholder concept?
A
- the belief that the prime function of a business is to satisfy its shareholders
17
Q
what is the stakeholder concept?
A
- where businesses cater for the needs of all stakeholders, not just shareholders
18
Q
what is ethics?
A
- the moral principles that guide the behaviours of individuals and behaviours
19
Q
what should ethical decision making consider?
A
- environment
- workers
- technology
- corruption
- pressure groups
20
Q
what is corporate social responsibility (CSR)?
A
- the belief a business should act responsibly and protect the interests of all the stakeholders
- going beyond following rules and regulations
21
Q
why is there pressure for effective CSR?
A
- bad publicity can easily be shared
- ethically orientated customers may choose a business based on its CSR
- good CSR will attract the best employees
- supports long term sustainability
