Key Business Functions / SMEs Flashcards
Characteristics of SMEs
owned and managed by owners or family members / limited capital / focus on narrow markets / greater flexibility in decisions and operations
Contributions of SME to HK economy
Provide specialised goods / provide job opportunities / promote innovative products and services / provide support and services to large enterprises
Contributions of entrepreneurship to business development
Promote innovation => satisfy customer demand and creare new business
Promote market competition with new items => more efficient operation and cheaper yet high quality goods
Promote economic growth
Key Functions of HR management
- Manpower planning
- Recruitment and selection
- Training and development
- Reward management
- Enhancing employee relations
Key functions of finance management
- Financial analysis
- Financial planning and budgeting
- Making investment decisions
- Making financing decisions
- Making working capital decisions
Key functions of operations management
- Designing efficient / effective production process
a. Plan for capacity
b. Choose a facility location
c. Design the workflow
d. Design jobs
e. Design a facility layout - Inventory management
- Quality assurance
- Logisics and distribution management
Key functions of marketing management
- Conducting market research
- Segmenting the market, selecting target markets and determining market position
- Formulating marketing strategies (4P)
- Implementing and controlling marketing activities
- Managing customer relationships
Key functions of information management
- Storing, processing and managing business transaction data
- Setting up and maintaining information systems to support other departments
- Setting up and maintaining network systems to facilitate communication
Key functions of risk management
- Identifying and measuring risks
- Controlling risks
Importance of planning
- Anticipating potential problems
- Establishing goals and provide direction
- Clarifying roles and responsibilities
Process of planning
- Establishing objectives and goals
- Gathering useful and relevent info
- Evaluating and determining alternative options
- Setting up a time frame for actions
- Implementing the plan
- Evaluating the results
Importance of organising
- Defining relationship
- Assigning responsibility
- Delegating authority
- Distributing information
What is line authority?
Superior-subordinate relationship
What is staff authority?
Colleague-to-colleague relationship (suggestions and advice)
Importance of leading
- Motivating workers to perform their tasks
- Avoiding mistakes and problems
- Improving company performance
Process of controlling
- Setting performance standards
- Measuring actual performance
- Comparing actual performance with standard
- Taking corrective actions
Performance standards
Productions dept => goods per hour / avg cost of goods
Marketing dept => market share / no. of customer complaints
HR dept. => staff turnover rate / cost of training or recruitment per employee
Advantage of division of work
- Practice makes perfect
- Save time in training / change working position
- Stimulus to mechanisation
Disadvantages of division of work
- Monotonous work
- Loss of craftsmanship
- Greater interdependence
- Greater unemployment risk
Advantages of unity of command
- Avoid confusing intructions
- Arranging appropriate workload
- Strengthening supervision
- Increasing accountability
Advantages of unity of direction
- Setting up clear goals
- Building up team spirit
- Avoiding confusing instructions
- Saving resources
Advantages of delegation
- Improve subordinates ability
- Enhance job satisfaction
- Manager concentrates on planning
- Reduce manager’s workload
How to effectively delegate
- Define job responsibility
- Ability and knowledge of subordinates
- Providing resources and training
- Monitoring work regularly
- Importance of the tasks
Advantages of management by objectives
- Improving subordinates commitment and morale
- Enhancing subordinates understanding of objectives
- Better communication between managers and subordinates
- Motivating subordinates
- better control over subordinates
Disadvantages of management by objectives
- Time consuming
- Increasing burdens to managers
- Emphasising on short-term objectives
