Business management Flashcards
5 generic elements of planning?
- Gathering information on
problems and opportunities. - Setting goals.
- Specifying what must be
done to achieve them. - Implementing the plan.
- Monitoring progress.
purpose of planning?
Clarify the direction of what to do
Motivate
Use resource effectively
Increase control
what is a business plan?
Created by people who are starting a new business or expanding an existing one. It is a document that
outlines the markets, the company plans to serve
What is a strategy plan?
The goal of strategy is to
determine, what business an organisation should be in, and how it will get there
what is an operational plan?
what senior management expects from specific
departments or functions.
what is a specific plan?
have clear, quantified objectives and leave no room for interpretation.
What is a directional plan?
when there is uncertainty about what needs to be done. Managers may decide to set the
objectives and leave the staff to decide to how to get there.
What is a decision?
Decisions are choices about how to act in relation to organisational inputs, outputs, and transformation processes.
What is a strategic/operational decision?
Commit significant resources to develop a new line of
production
* How to allocate resources between departments, how
to manage them efficiently
What is a commitment to action?
At all levels – the focus here is organisational
what are Programmed decisions?
Repetitive, routine
* Deals with familiar, structured problems and information known
* Resolve by definite procedures, rules, policies, and quantitative analysis
* E.g., supermarket’s stock control system, which automatically orders new stock based on
point-of-sale information
* Appointing junior staff
* Made at lower-level management
what are unprogrammed decisions?
Unfamiliar, unique problem, information unclear and open to interpretation
* Resolution depends on judgement, intuition, negotiation, creativity, insights into the problem definition.
* Made at Top level management
* E.g., Launch a new service or product
What is the context behind decisions?
Certainty
* All information available
Risk
* Enough information to estimate
Most decisions are made under conditions of risk
Uncertainty
* Goals clear (People know what they wish to achieve)
* But lack information to decide on action
Ambiguity
* Goals AND how to reach them unclear
What is the economic model?
Sometimes called the ‘economic model’
* Economists use this model to analyse pricing, investment or other
decisions in conditions, where the goal is clear, and there are
several ways to achieve it.
What is the administrative model?
People process limited amount of information
* Problems are unstructured and NOT measurable
* Goals and routes to achieve them are unclear
* Aims to describe how managers actually make decisions in situations of uncertainty and ambiguity.
* Decisions under this model tend to be NON-programmed – intuitive, experience based, judgment
based, creative approaches
Why study models?
Managers will act on their own mental model.
Different managers see the world differently and will devise unusual ways to approach problems.
Can benefit from a broader range of strategies.
who invented the rational goal model?
Taylor f.w (1856-1915)
What is the rational goal model principals?
1.Use scientific methods to find the one best way of doing a task
2. Assign the best (most skilled, most efficient) person to do that task
3. Train and allow employees to grow
4. Use financial incentives to ensure workers follow the correct method. “He believed
employees should be rewarded when productivity rose,
5. Transfer responsibility for planning and organising to manager, allowing the workers to get
on with their assigned tasks
Who made the internal process model?
Max Weber (1864 – 1920)
what are the rules of the internal process model?
Rules and regulations: to guide behaviour
* Impersonality: to protect against favouritism, E.g. Appraisal process based on assessment not personal preference
* Division of labour
* Hierarchy: reflecting power to make decisions
* Authority
* Rationality: managers should use the most efficient methods to achieve objectives, assess issues based on evidence
not personal preference
internal process model 2.0 rules?
Division of work
* Unity of command and direction: “An employee should receive orders from one supervisor only.
* Find the right degree of centralization: Balancing centralized decision-making (from the top) with letting
employees make decisions.
* Stability of tenure: minimize staff turnover
* Encourage initiative
Human relation models rules?
People are motivated by social needs, and recognizing these will secure
commitment
* Advocated replacing bureaucracy with group networks in which people solve
problems
* Solving problems created unity amongst groups
What is communication?
Is the exchange of information through written or spoken words to reach a mutual understanding.
what is a sender?
the person who initiates a conversation.
what is encoding?
Process of selecting certain words or non-verbal methods (symbols,
signs, body gestures) to translate the information so it can be communicated
what is a communication channel?
How the message will be delivered. You should find the
most suitable to make the message effective and avoid it being misinterpreted.
what is a receiver?
The receiver is the person the message is for.
what is decoding?
The receiver interprets the message to try and understand it.
what is feedback?
How the receiver makes sure they have interpreted the message
correctly as the sender intended it
what is noise?
The communication barrier or barriers that prevent effectively
communication
