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LC Business Studies > Management Activities > Flashcards

Management Activities Flashcards

1
Q

What are three main management activities?

A

Planning
Organising
Controlling

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2
Q

Explain planning with an example

A

This is where a manager:
Sets goals (objectives) for the business to achieve in the future and then:
Comes up with strategies on how the business can achieve those goals
Ex: Objective – increase business sales by 10% in the next year.
Strategy – increase advertising and reduce price of product.

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3
Q

What are the steps involved in planning?

A

Develop a SWOT Analysis
Set Objectives
Devise Strategies
Implement the Plan

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4
Q

What are strength in a SWOT analysis with examples

A

(Internal)- Something the business owns or does well that gives it a competitive advantage
Ex: Excellent employees, Assets

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5
Q

Explain Weaknesses in a SWOT analysis with an example

A

(Internal)- Something that the business does badly or is lacking altogether that puts it at a competitive disadvantage
Ex: Lack of money

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6
Q

Explain threats in a SWOT analysis with an example

A

(External)- Something in the outside world that can prevent the business from succeeding
Ex: Competition from outside companies

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7
Q

Explain opportunities in a SWOT analysis with an example

A

(External)- Something in the outside world that the business can avail of to make money or benefit from
Ex: New countries joining the EU (market expansion)

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8
Q

What does SWOT stand for

A

Strengths, weaknesses, opportunities and threats

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9
Q

What are objectives with example

A

The business should use the SWOT analysis to set objectives for the company.
Objectives are the goals the business wants to achieve.
Ex: Aer Lingus had ryanair as major threat so they set the objective to become low fares airline

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10
Q

What does devising strategies mean with an example?

A

The business must come up with strategies to achieve these goals.
Strategies are plans of action to achieve a goal.
Ex: Aer Lingus had a strategy of making 2000 employees redundant to cut costs

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11
Q

Name three types of strategy

A

Low cost leadership
Differentiation strategy
Niche strategy

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12
Q

Explain a niche strategy with an example

A

This strategy spots a group of individuals with specific needs in the market and makes a product to satisfy those needs.
Example: Ferrari Cars

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13
Q

Explain a low cost leadership strategy with an example

A

The aim is to keep costs low and sell the products as cheaply as possible.
Example: Ryanair

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14
Q

Explain a differentiation strategy with an example

A

The aim is to make products different from competitors and make them stand out.
Example: Abercrombie & Fitch

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15
Q

Explain implementing the plan with an example

A

The plan put into action
The manager must break the jobs down into manageable jobs and assign roles to employees.
The manager communicates the plan to employees and ensures they understand what they must do.
Ex: Aer Lingus asked employees to volunteer for redundancy

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16
Q

Name four types of plans

A

Mission statement
Strategic plan
Tactical plan
Contingency plan

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17
Q

Explain the mission statement with an example

A

The mission statement outlines the direction of the business and their overall objectives.
Example: ‘We provide our customers with the best value for money through a convenient shopping experience.’

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18
Q

What is a strategic plan?

A

A long term plan of action for the business as a whole

It takes the business’ mission statement and breaks it up into major plans of action for the business to work on

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19
Q

What is a tactical plan?

A

A short-term plan for the business
Usually applies to a particular department of the business
Breaks up the strategic plan into smaller plans of action
Time Span: 1 Year

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20
Q

What is a contingency plan? with an example

A

A back up plan to help the business cope with an emergency or an unforeseen event
The aim is to limit damage and prevent disruptions to the business ex: Business have contingency plans to deal with the break up of the eurozone

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21
Q

What are the advantages to planning?

A 
Guides the business to success
Helps avoid future problem
Eliminates the business’s weakness
Helps secure capital (investment/money)
Motivates employees and managers
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22
Q

What are the characteristics of a good and effective plan?

A 
Specific
Measurable
Agreed 
Realistic
Timed
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23
Q

What is organising and how is it done?

A

This is the structuring of the business in the best way possible to allow the business achieves its goals.
Resources of the business are arranged in the most suitable way
Work is split into jobs and these jobs are assigned to specific departments (organisational structures)

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24
Q

Name four types of organisational structures

A

Functional Organisational Structure
Product Organisational Structure
Geographical Organisational Structures
Matrix Organisational Structure

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25
Q

What is a functional organisational structure and give some advantages and disadvantages

A 
The business is split up into different jobs or functions
Advan:
Greater Specialisation
Accountability
Clarity of Roles
Disadvan:
 Can Lead to Isolation
Lack of Co-Ordination Between Departments
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26
Q

What is a product organisational structure and give some advantages and disadvantages

A 
The business is split up into departments based on products made
Advan:
Focus on the Customer
Healthy Competition  Between Departments
Incentive to Keep Costs to a Minimum
Disadvan:
Duplication of Departments
Brand Cannibalisation
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27
Q

What is a geographical organisational structure and give some advantages and disadvantages

A 
Business departments are based on geographical areas they are operating in
Advan:
 Serves local needs better
Healthy Competition Between Departments
Incentive to Keep Costs to a Minimum
Disadvan:
 Duplication of Departments
Conflict Between Managers
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28
Q

What is a matrix organisational structure and give some advantages and disadvantages

A 
Employees placed on temporary project teams depending on the projects being carried out at any given time.
Advan:
 Improves Co-Ordination
Better Ideas
Develops Employees
Disadvan:
 Employees must report to two bosses
Increased costs
Slow Decision Making
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29
Q

Explain chain of command

A

This is the unbroken line of authority that links all individuals in an organisation and specifies who reports to who. also shows official channel of communication

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30
Q

What is Delayering?

A

Is when some layers of management are taken out of the company. If there are too many layers, the sending of information may be slow.

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31
Q

What is Restructuring?

A

This is the process changing the organisation of the business to make it more efficient.

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32
Q

What is the span of control and the two types

A

The number of employees that report directly to a manager. It can be:
Wide: a manager can supervise a lot of employees effectively at the same time
Narrow: a manager can only supervise a few employees effectively at the same time

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33
Q

What does the span of control depend on?

A 
The manager’s experience and ability
The employee’s experience and ability
The type of work to be done
Location of Employees
Outside pressure on the manager
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34
Q

What is line organisation?

A

Line departments are those that are directly responsible for making and selling the business’s products e.g Marketing, Production

35
Q

What is staff organisation?

A

These are the departments who provide expert advice to the line departments e.g I.T Department, Legal Department

36
Q

Give four advantages of organising

A

Helps to solve problems quickly
Improves efficiency
Helps the business cope with change
Minimises waste

37
Q

Explain controlling?

A

This involves the manager making sure the business stays on target to achieve the objectives that were set out during planning.

38
Q

What are the steps with controlling?

A

Set goals
Measure actual performance regularly
Identify any deviations and investigate them
Take corrective action to stay on target

39
Q

What are the four main areas of controlling

A

Stock Control
Quality Control
Credit Control
Financial Control

40
Q

Explain Stock Control

A

Aim: to ensure the business has exactly the right amount of stock in the organisation at all times. Enough to meet the demands of customers
Too much stock- out-of-date or going off
Too little stock - company run out (stock out)

41
Q

Explain Just-In-Time

A

Form of Stock control. Aims to keep the minimum amount of stock possible in the business while at the same time never running out of stock.
Buy from supplier only when materials are needed.
They are used straight away

42
Q

Give and explain advantages of stock control

A

Does not carry too much stock- lower insurance premium
Easier to spot and eradicate theft
Always have right amount of stock. Customer satisfaction and increases sales and reputation.
Saves money and less waste- stock deterioration an obsolescence

43
Q

Explain quality control and give three forms

A

Ensures the quality of the business’s products reaches a high standard and meets customers expectations.
Forms: Physical Inspection, Quality Circles, ISO 9000 Awards

44
Q

Explain one by one inspection

A

Trained inspectors physically examines every single product before they leave the factory.
Only the products that meet the standard leave the factory to be sold.
Example: Louis Vuitton

45
Q

Explain sampling inspection

A

A batch of the product is made
A random sample is picked by the inspector for inspection
If sample passes, inspector passes the whole batch
If sample fails, inspector fails the whole batch

46
Q

Explain what the ISO 9000 is

A

Internationally recognised quality award
Apply to the ISO (International Standards Organisation) for the award.
Independent team of inspectors review the product’s quality standard

47
Q

Explain Quality Circles

A

Small group of employees meet regularly to spot quality problems in the factory and try to solve them.
Employees are best placed to know the business’s quality problems
They meet raise the question and discuss it.
If solution is approved by manager employees help implement it

48
Q

Explain and give the advantages of quality control

A

Increased sales- Quality is of highest standard. Customers are happy and continue to buy product.
Lower costs- no waste of money on repairing faulty goods of giving refunds
Marketing- quality mark ISO 9000 reassures customer it is a good quality, trusted brand

49
Q

Explain Credit control

A

Ensure the business’s customers (debtors) who buy goods on credit pay their bills on time.
Aims to eliminate bad debts (customers not paying their bills)

50
Q

Name the steps in credit control

A

Overall limit
Credit checks
Prompt invoices and offer discounts
Collection procedures

51
Q

Explain overall limit as a step in credit control

A

Max amount of credit they will give to customer

never loses more than this amount

52
Q

Explain credit checks as a step in credit control

A

Vets each customer to see if they can be trusted with credit
Credit check can be run through Central Credit Register
Business can ask for interview/references from bank or other business

53
Q

Explain Prompt invoices and offer discounts as a step in credit control

A

Send invoice out immediately- deadline of payment

Should offer discounts for early payment

54
Q

Explain Collection procedure as a step in credit control

A

Must have procedure for collecting money of customers who do not pay
By telephone or visit- insist on immediate payment
May add interest on outstanding bills
Can take case to court

55
Q

Explain and give the advantages of credit control

A

Ensures the business receives the money owed to them on time- not go bankrupt
Reduces costs - not losing money on bad debts
Helps the business choose the right customers to offer credit to- ensures increased sale with credit available

56
Q

Explain Financial Control and name three methods

A

Aims to ensure the business is profitable and always has enough money to pay its bills.
Methods - Budgeting , Compare Cash Flow Forecasts, Ratio Analysis

57
Q

Explain Budgeting as a method of financial control

A

Each department has budget detailing amount of money allowed to spend each year.
Must not go over this amount

58
Q

Explain Cash flow as a method of financial control

A

Manager compares cash flow with cash flow forecast

May take corrective action is necessary- ensure enough cash to pay bills

59
Q

Explain Ratio analysis as a method of financial control

A

Comparing business’s actual ratios with budgeted ratios see if it’s on or off target.
Steps to get back on target

60
Q

Name four advantages to controlling

A

Ensures that the business achieves its objectives
Reduces the business’s costs
Improves cash flow
Increases Sales and Profits

61
Q

What is a SWOT analysis

A

This is where the manager critically examines the business by identifying those things that is good and bad at in the business. It also examines the competitive external environment

62
Q

Example of a SWOT analysis with Ryanair

A

Strengths- Excellent CEO innovative ideas to improve airline and famous brand name- stands for low cost flights
Weaknesses- Industrial relations problems, reputation of poor customer service to passengers
Opportunities- Transatlantic service will increase passenger numbers, lower costs of oil
Threats- Stiff competition (easyjet), Increasing government passenger taxes

63
Q

Give an example of an airlines mission statement, strategic plan and tactical plan

A

“To become the biggest airline in the world”
To operate 20% of flights from Europe to the US within the next 5 years
To launch Dublin-New York flights in the next 6 months

64
Q

Explain planning guides the business to success as an advantage of planning

A

Manager can focus on the future of the business. Sets out objectives to be achieved and strategies by which they will be achieved. Guides manager to success

65
Q

Explain planning helps avoid future problems as an advantage of planning

A

Manager can anticipate problems facing the business. Solving problems in advance of them happening avoids business failure.

66
Q

Explain makes the business stronger as an advantage of planning

A

SWOT analysis identifies the business’s weaknesses. Steps can be taken to eliminate these and become stronger and ore successful. Ex: Cash flow forecast allows manager to identify over spending and take steps to eliminate it.

67
Q

Explain planning helps secure capital as an advantage of planning

A

When a business wants to raise finance, it must prove capable of repaying it. A business plan is used to convince investor to provide the funding showing them the business idea is a sound one.

68
Q

Explain planning motivates employees and managers as an advantage of planning

A

Everyone has a target to aim for. When target is achieved there is a sense of satisfaction providing drive and inspiration

69
Q

Explain the advantages of a functional organisational structure

A

Specialisation- departments focus on one job. Become expert at it. Jobs are done quickly to high standard
Accountability- Director of department is responsible for all that happens in it. Easy to spot source of error
Clarity- Everyone knows who reports to whom - speed up communication

70
Q

Explain the disadvantages of a functional organisational structure

A

Isolation- People in departments may know little about each other and what departments do
Co-ordination- Difficult to get departments to pull together in same direction

71
Q

Explain the disadvantages of a product organisational structure

A

Duplication- Number of same departments. Higher wasteful costs
Brand cannibalisation- May be stealing of customers from other company products

72
Q

Explain the advantages of a product organisational structure

A

Focus on customer- Make one product only. Concentrate on giving best product to consumers
Competition- Between departments to be most successful. All departments strive to be the best
Lower costs- Greater incentive for each department to keep it’s costs to a minimum

73
Q

Explain the advantages of a geographical organisational structure

A

Serve local needs better- Know what their customers want and need. Higher sales
Competition- Between departments to be most successful. All departments strive to be the best
Lower costs- Greater incentive for each department to keep it’s costs to a minimum

74
Q

Explain the disadvantages of a geographical organisational structure

A

Duplication- Number of same departments. Higher wasteful costs
Conflict- Conflict arise between senior managers- who knows best for the local business

75
Q

Explain the advantages of a matrix organisational structure

A

Better coordination- Employees mixing helps the respect other roles in the business. Departments pulling together to make business a success
Better ideas- Brainstorming, Different enterprise and ideas to build on. Team produces better solutions
Develops employees- Exposes them to practice more experienced workers work. Learn more about job. Quicker than learning alone

76
Q

Explain the disadvantages of a matrix organisational structure

A

Two bosses- Functional boss and project boss. When both give conflicting orders can cause confusion
Increased costs- Train managers to become project managers. Extra secretiarial/admin costs
Slow decision making- Consulting everyone takes time. Slows down process of decision making

77
Q

Explain organising helps solve problems quickly as an advantage of organising

A

Clear organisational structure ensure employees know exactly what to do and who to go to with an issue. Problems solved quickly

78
Q

Explain organising improves efficiency as an advantage of organising

A

Employees specialise in one job and become better and faster at it. Better quality of work

79
Q

Explain organising helps the business cope with change as an advantage of organising

A

Matrix organisational structure sets up project teams alongside regular functional structure. Teams are set up quickly to solve urgent issues facing business while normal work continues.

80
Q

Explain organising minimises waste as an advantage of organising

A

Proper assignments of jobs avoids overlapping work. Makes best possible use of resources. Avoids work duplication

81
Q

Explain Controlling makes sure the business achieves its objectives as an advantage of controlling

A

Checking up on the progress of business to ensure it is on target to achieve goals. Steps can be taken to correct anything off target

82
Q

Explain Controlling reduces business’s costs as an advantage of controlling

A

Great control programmes ex: ISO9000 Ensures products are of excellent quality. No wasting money on faulty products/repairs

83
Q

Explain Controlling the business improves it’s cash flow as an advantage of controlling

A

Debtors pay on time with an effective credit control policy. Business cash flow improves as they receive cash in plenty of time of needing to pay bills.

84
Q

Explain Controlling increases a business sales and profits as an advantage of controlling

A

Quality control ensure top quality products. Stock control means there is always stock to be bought by customers. The reputation of business is boosted with availability of excellent products. - more sales

LC Business Studies (28 decks)

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