Term 2 - Business Management

Question 1

What are the features of effective management?

Answer 1

Planning: the preparation of a predetermined course of action for a business.
Organising: the structure of the organisation to translate plans and goals into action.
Leading: the process of influencing people to work toward the achievement of the organisation’s objective.
Controlling: compares what was intended to happen with what has actually occurred.

Question 2

What are some management skills?

Answer 2

• Interpersonal
• Communication
• Strategic Thinking
• Vision
• Problem-Solving
• Decision Making
• Flexibility & Adaptability to Change
• Reconcile Conflicting Interest of Stakeholders

Question 3

What does the SMART principle stand for?

Answer 3

Specific
Measurable
Achievable
Realistic
Time-based

Question 4

What are the three types of business goals?

Answer 4

Strategic Goals - Long term, broad aims for the business to achieve as a whole (more than 5 years).

Tactical Goals - Mid term, departmental issues, describe actions to achieve strategic goals (1-3 years).

Operational Goals - Short term, day to day operation to achieve tactical goals (less than a year).

Question 5

What are some financial goals?

Answer 5

Maximising Profits: maximise revenue and minimise expenses.

Increasing Market Share: Increase the business’ share of total industry sale of a good or service.

Maximising Growth: business expansions both internally (more employees, new product lines, equipment) and externally (merge and acquisition, vertical and horizontal integration).

Improving Share Price: if the business is performing well, the share price should increase and yield a better return to shareholders.

Question 6

What are the four key functions/resources of a business?

Answer 6

Operations
Finance
Marketing
Human resources

Question 7

What does Operations refer to?

Answer 7

Operations refers to the business processes that involve transformation or, more generally, ‘production’.
During the process, inputs are transformed into finished products or outputs.
Operations management consists of all the activities in which managers engage to produce a good or service.

Question 8

What are the two different types of inputs?

Answer 8

Transformed resources are those inputs that are changed or converted in the operations process, including:
- Materials
-Information
Customers: their choices shape inputs

Transforming resources are those inputs that carry out the transformation process. They enable the change and value adding to occur.
- Human resources
- facilities: the plant (factory or office) and machinery

Question 9

What does ETM and STM stand for?

Answer 9

Simply Transformed Manufactures (STM): Intermediate products that require further processing (minimal value added) e.g. converting iron ore to steel.

Elaborate Transformed Manufactures (ETM): Highly processed and valued products (value added) e.g. car, computer, phones.

Question 10

What are outputs?

Answer 10

Outputs refer to the end result of a business’ efforts - the service or products that are delivered or provided to the consumer.

Question 11

What are the three types of quality management?

Answer 11

Quality control
Using inspections at various points in the production process to check for problems and defects.

Quality Assurance
Using a system so that a business achieves set standards in production (e.g. ISO 9000 aka International Organisation for Standardisation).

Quality Improvement
Quality improvement focuses on two aspects: total quality management and continuous improvement. Total quality management (TQM) is an ongoing, business-wide commitment to excellence that is applied to every aspect of the business’ operation. Continuous improvement is a process that involves a constant evaluation of, and improvement in, the way things are done to achieve perfection.

Question 12

What is place?

Answer 12

Place of distribution refers to the methods and strategies of delivering the product to the customers.

Producer to customer: Simple without intermediaries. Most companies in the services industries use this.
Producer to retailer to customer: The middle player (intermediary) buys from the producer and sells it to the customers for profit, e,g, bulky perishable goods (fruits, furniture).

Question 12

What is the marketing mix?

Answer 12

Product, Price, Promotion, Place.

Question 13

What is the HR cycle?

Answer 13

1. Acquisition (hiring employees)
2. Development (training)
3. Maintenance (motivation of employees)
4. Separation (the end of professional relationship between employees and employers)

Question 14

What is the difference between training and development?

Answer 14

Training: process of teaching staff or passing new skills to perform their tasks more effectively and efficiently.

Development: activities that can prepare and assist staff to take more responsibilities.

Question 15

What are the five categories or an employment contract?

Answer 15

Common Law
Minimum employment standard
Award
Enterprise Agreement
Individual common law contract

Question 16

What are the 7 types of separation?

Answer 16

Redundancy
The role or job within an organisation is no longer needed/required (e.g. due to technological changes, or maybe a merger or an acquisition) .

Retrenchment
The organisation does not have enough work for the employee to undertake.

Retirement
Retirement occurs when an employee decides to give up full-time or part-time work and no longer be part of the labour force.

Resignation
Resignation is the voluntary ending of employment by the employee ‘quitting’ their job.

Dismissal
Terminating the employment contract due to inappropriate behaviour/actions from the employee.

Unfair dismissal
Employer terminates employment contract for discriminatory reasons (the employer discriminating the employee, harsh, unjust and unreasonable).

A summary dismissal (or instant dismissal)
The immediate termination of an employee due to their behaviour, the basis of which is gross misconduct.