Theme 1 Flashcards
Demand
the amount of a good that consumers are willing and able to buy at a given price
Mass market
products made for the majority of public
Niche market
products made for certain people
Market share
How many customers a company has in a market
Dynamic market
A market that is subeject to rapid changes
Uncertainty
When a business are unable to predict external shocks or future events
Market mapping
the process of finding variables which differnate
Cost Leadership
The ability a business has to create products at the cheapest
Factors o designing a product
Asethetics
Price
Function
Knowledge
Defection of key terms
Cost plus pricing
A cost-plus pricing strategy seeks to set a price for a product or service which covers the costs AND provides a good profit margin for the busines
Doesn’t look at the price of the competitors
Skimming price
Price is set high at first to cover for cost of reasearch and development and then when competitors join the market they will drop the price
Risky strategy as customers may be put off from buying due to the high price
Competitive pricing
When company will base their price on competitors and will focus more on service etc to compete
Price Elasticity of demand
Elasticity measures the responsiveness of demand to a change in a relevant variable-price or income
Price inelastic of demand
Not matter price or income the product will still gain sales -water, petrol
Price elasticity of demand
%change in quantity demanded /%change in price
hard approach in hrm
Treats employees as a cost of the business
Soft approach in hrm
Treats employees as the most important asset in the business and a source of competitive advantage
Point of a hard approach
Pay at nmw
Use zero hours contract
Lack of job security
Minimum investment in training
Point of soft approach
Competitive pay structure and benefits
Effective requirement process
Per any contract providing job security
Effective two way communication
Recruitment process
1.identify the vacancy
2.write a job description
3.write a person specification
4.advertise the vacancy
5.candidates apply
6.candidates shortlisted
7.shortlisted candidates interviewed
8.other recruitments activities
9.successful candidates is offered a job
decentralisation
where a business divides up the organisation of its business into areas
Centralisation
where a business has its organisation of management and administration at one central head office
Chain of command
The chain of command in a business is the flow of information power and authority through the organisation
Tall hierarchical structure
In a tall structure there maybe lots of opportunity for promotion and work is shared among all workers .
Flat structure
companies have a flat structure. They have a wide span of control and a short chain of command so information flows quickly throughout the organisation.
Organisational design
Organisational design refers to a diagram or chart which shows the lines of authority and layers in the hierarchy of the business
Recruitment
Recruitment is the process of finding people to work for a company or become a new member of an organisation
Recruitment process
Identify the process
Write a job description
Write a person description
Advertise the vacancy
Candidates apply
Candidates apply continued
Candidates are shortlisted
Shortlisted candidates are interviewed
Particpants go on a recruitment activity
Successful candidate is offered the job
Induction training
Induction training happens when an employee starts working for a new business
On the job training
Coaching or mentoring while doing the job
Off the job training
Involves work at home or courses at company training centres/colleges
Hierarchy
A hierarchy is a system in a business where employees are ranked due to their status and authority
Chain of command
The chain of command in a business is the flow of information power and authority through the organisation and people at the top have more power .
Span of control
it’s the number of people that a manager is responsible for
Organisational structure show ?
Names of departments
Job roles
Responsibility and accountability
Lines of authority
Chains of command in the organisation
Matrix structure
It is a better structure to use when creating more than one product in a business like in car manufacturers how they have to build family cars and sports card so u apply different structures to different projects/products .
Motivation
Having motivated staff leads to greater productivity which means less wastage and higher profitability for a business.
Importance of motivated employees ?
More creative
More accurate
More analytic
Better at handling problems
Better at selling
Taylor’s motivation theroy (1909)
. “ a fair days pay for a fair days work “
.he said employees will do minimum work if not supervised( no trust )
.main form of higher motivation is to offer higher wages
. Mangers job is to tell employees what to do and manage them
. Workers job is to do what they are told
Mayo human relation theroy (1930)
. He did reasearch with workers in Hawthorne factory in Chicago
.found that by lady’s just being studied they became more motivated
.working in teams was more important than money (non finically motivators were the most important )
.motivation depends on how well they communicate with each other (mangers ,employees and etc.)
.it is the appreciation a employee Is shown which motivates them the most
.changing the environment doesn’t increase productivity
Marlows hierarchy of needs
Bottom : physiological needs
Safety needs
Love needs
Esteem needs
Top:self acuszation
Physiology needs
At the bottom is basic needs like for water and food
If these are not met we have no interest of joking clubs etc
Safety needs
.here in the hero hat you have the need for health and safety like a house and secure roll of employment
.if employees think they are going to be sacked they are less likely to work and be motivated
Love needs
.here in the hierarchy we seek love and friendship like craving affection and love and to belong to clubs and social groups etc
.if these needs are not met you are unlikely to be productive
Esteem needs
. Here in the hierarchy we seek for respect off others like independence and status and want to feel important at work (seek a feeling of accomplishment)
.
Self actualisation
.here is the top of the hierarchy we only reach this when all other needs are met ; here we are acceptance of our circumstances and try to inspire other etc.
.at this level we are mindful and self sufficient and interested in travelling and hobbies etc .
Herzberg – two factor theory
. They interviewed accountants and engineers to find out what motivated them
.he found employees motivating factors : interesting work, personal achievement and responsibility
.he learnt from employees about hygiene factors that motivated them which were: good working conditions , right pay and relationships with other employees
Stick business
In “stick” businesses the boss thinks that the best way to motivate their staff is through; shouting, punishment if they don’t work hard e.g. dock their pay
Finical motivation methods
Piecework
Commission
Bonus
Profit share
Performance-related pay
Piecework
Employees are paid on the output how many products they make and sell or they can take the national minimum wage
.creates more efficient and experienced workers and incentive to complete work
.slower workers may earn under the national minimum wage
Commission
Were employees are paid based on how much they sell or offered a low wage and then what they sell
.skilled salespeople can make some serious money and motivates employees to sell more
.not a steady income and temptation to pressure to sell
Bonus
Bonus is a lump which is paid on top of an employees national minimum wage
. A bonus payment can also be used as a means of appreciation for an employee’s hard work
. A cash bonus can be costly for any company so gift cards are offered instead which will not make the employees feel as appreciated
Profit share
When employees may be paid an annual dividend based on the level of profits made by the firm
. Brings employees together to work towards a common goal and The employee focus will be on profitability
. The focus of the employee may be on the profit share rather than on quality customer service
Sole trader
Business owned by one person
They can employee staff it can not be involved in te business
Unlimited liability
Easy to set up and not a lot of capital need and can keep all profit
Don’t have economies of scale ( can’t buy in bulk )
Partnership
Two or more people own the business
Profits and wins are shared equally tween partners
Unlimited liability
No need to to make public any information and some can take over when sick
Private limited company
Friends and family can buy shares in the business becoming part owners but not the public
Shares give the business more capital
Limited liability
Limited liability
When the owners assists cannot be taken by the bank when the business goes bankrupt
Unlimited liability
When the owners assists can be taken by the bank when it goes bankrupt
Social enterprise
A business that trades for a social and environmental purpose , objective to help society or the planet in some way
Staff as a cost : 6 main factors
Cost of recruitment
Cost of training
Sort of paying minus wages
Cost of paying salaries and wages
Cost of welfare
Cost of redundancy
Staff as an asset
Useful/ valuable to the business
Staff devolped with training seen as a benefit
Staff allowed to practice in business decisions
Higher retention rate
Multi skilling
Have a workforce/employees which are able to do more than one job
Less staff are needed and more interesting jobs for employees
Business loses the benefit of have specialist staff
Outsourcing
When a company hires another company to do speaclist jobs for them
Fired(dismissal)
When a employee is forced to leave a job normally cause they have done something wrong and are not entitled to a pay out
Redundant
When a employee’s job is no longer available so they have to leave and are entitled to a pay out normally
collective bargaining (the union rep bargains on behalf of the collective)
If there are problems at work employees can be represented by a member of their trade union. Rather than 300 employees all complaining to the boss about the same thing the trade union rep will argue on their behalf
Trade union
This is normally a group of workers which covers the problems and changes in the workforce and helps them out
Discussing employees concerns and discusses big changes like large redundancy
Herzebrgs two factors
Motivators : factors that directly motivate people to work harder
Hygiene: factors that can demotivate if not present but do not actually motivate employees to work harder
Herzberg employee motivators
Aprriceated by managers
Bonuses
Promotion
Challenge
Empowered
Delegate
Herzberg two factors pros for each
Motivators : responsibility at work , meaningful work , achievement and recognition
Hygiene : pay and other financial rewards , working conditions, approximate and supervision polices
Job enrichment factors
Wider variety of tasks
Greater complexity and challenge
Manage own workload
Greater sense of achievement
Empowerment factors
More responsibility and autonomy
Allow employees to make decisions independently
Less supervision
Demonstrates trust
Organisational structure show
Names of department
Job roles
Responsibility
Lines of authority
Lines of communication
Chains of command in the business
Intrapreneurship
Where large business enable employees and managers to demonstrate entrepreneurial behaviour in their work to the benefit of their employer
Pros and cons of qualitative data
Greater in delight in the how and why to help understand issue in depth
Slower to gather
Difficult data to analyse
Harder to make business decisions off
Pros and cons of quantitative data
Easier to gather
Quicker to gather
Faster to analyse
Larger sample size
Easier to make descions off
Tends to have narrow / closed QS
unhelpful if you want to know the issue in depth
Market oreniation
When a business focus on the needs of consumer (market )
Constant market research but build business confidence that new products are meeting customer needs
And develops a greater understanding of consumer
Product orientation
Focuses on what the businnes is best at and the focuses on that in descions making process
May lead to greater levels of innovation and different action and also the market may not know what it wants yet
Benefits of branding
Add value
Stimulate sales
Devolping Barrie’s to entry
Helps to add new product devolpment
Insulates against the businnes cycles (resscion )
