Topic 6 HRM miss

Question 1

What does HR performance measure (5)

Answer 1

• labour productivity
• employee costs as a percentage of turnover
• labour cost per unit
• labour turnover
• employee retention rate

Question 2

What is labour productivity

Answer 2

It compares the number of workers with the output of the business

Question 3

Labour productivity equation

Answer 3

Output per time period
_________________________

Number of employees

Question 4

Labour productivity

In order to remain competitive …

Answer 4

A business needs to keep its unit costs down

Question 5

Key factors that influence the level of labour productivity (6)

• fixed assets
• workforce
• methods of ..
• training
• other factors
• competition

Answer 5

• extent and quality of fixed assets
• skills, ability and motivation of the workforce
• methods of production organisation
• extent to which the workforce is trained and supported
• external factors
• degree of competition

Question 6

Approaches to improve labour productivity (4)

• measure …
• invest in ..
• improve ..
• training

Answer 6

• measure performance and set targets
• invest in capital equipment (automation)
• improve working conditions
• invest in employee training

Question 7

Issues when trying to raise labour productivity (3)

• quality
• employee resistance
• higher pay

Answer 7

• quality may suffer-higher output must still be of the right quality
• potential for employee resistance- depending on the methods used (new technology)
• employees may demand higher pay for their improved productivity (impacts labour cost per unit)

Question 8

What is absenteeism/ labour turnover

Answer 8

An employee’s intentional or habitual absence from work

Question 9

Labour turnover formula (employee)

Answer 9

Number of staff absent during period

______________________________ X 100

Number employed during period

Question 10

labour turnover formula (days off)

Answer 10

Number days taken off for unauthorised absence (during period)

___________________________ X100

Total days worked by workforce over the period

Question 11

Employee costs as a percentage of turnover

Formula

Answer 11

Employee costs
_________________ X100

Sales turnover

Question 12

Employee costs as a percentage of turnover

A high figure …

Answer 12

Can show the impact of inefficiency e.g. less productive staff, lower sales, higher wage costs as a percentage of sales

Question 13

Employee costs as a percentage of turnover

However, a high percentage …

Answer 13

Could be an indication of mire staff/better service in a service sector organisation

Question 14

Labour costs per unit

Formula

Answer 14

Labour costs
______________

Units of output

Question 15

Labour costs per unit

If labour cost per unit is higher …

Answer 15

Lower profit margins will be made

Question 16

Labour costs per unit

Lower labour costs per unit …

Answer 16

Will allow a firm to be more competitive

Question 17

Internal causes of labour turnover (3)

Answer 17

• poor recruitment processes (wrong staff selected)
• ineffective motivation or leadership
• wage levels lower than other firms

Question 18

External factors of labour turnover (2)

Answer 18

• more local vacancies

- better transport

Question 19

Negative of labour turnover (4)

Answer 19

• cost of recruitment
• cost of training
• time taken for new staff to settle
• loss of productivity while new workers learn

Question 20

Positive of labour turnover (3)

Answer 20

• new workers with ideas and enthusiasm
• workers bring new skills
• new ways ti solve problems

Question 21

Employee retention formula

Answer 21

Number of employees at the end of period — number of leavers
___________________________ X100

Number of employees at the end of period

Question 22

To assess performance good managers analyse …. (3)

Answer 22

• changes over time
• comparisons with other firms
• performance against targets

Question 23

What does hierarchy mean

Answer 23

Number of layers within an organisation

Question 24

What is a span of control

Answer 24

The number of subordinates for whom a manager is directly responsible

Question 25

What does a suitable span of control depend on: (4)

Answer 25

- experience and personality of manager - nature of business - skills and attitudes of employees- highly skilled workers may not need close supervision - tradition and culture of organisation e.g. democratic leadership will empower workers so a wide span of control

Question 26

3 features of a narrow span of control

Answer 26

- allows for closer supervision of employees - more layers in the hierarchy may be required - helps more effective communication

Question 27

2 features of a wide span of control

Answer 27

- gives subordinates the chance for more independence | - more appropriate if labour costs are significant-reduce number of managers

Question 28

What is a chain of command

Answer 28

The lines of authority within the business

Question 29

Features of a tall structure (5)

Answer 29

- many layers if hierarchy + narrow spans of control - allows tighter control (less delegation) - more opportunities for promotion - takes longer for communication to pass through layers - more layers = more staff= higher costs

Question 30

Features of a flat structure (5)

Answer 30

- few layers of hierarchy + wide spans of control - less direct control + more delegation - fewer opportunities for promotion, but staff given greater responsibility - vertical communication - fewer layers = less staff = lower costs

Question 31

What is delegation

Answer 31

The assignment to others of authority for particular functions, tasks and decisions

Question 32

5 advantages of delegation

Answer 32

- reduces management stress and workload - allows senior management to focus on key tasks - subordinates are empowered and motivated - better decisions or use of resources - good method of on-the-job training

Question 33

4 disadvantages of delegation

Answer 33

- cannot/ should not delegate responsibility - depends on quality/ experience of subordinates - harder in smaller firms - may increase workload and stress of subordinates

Question 34

4 benefits of delayering

Answer 34

- lower management costs - faster decision making - shorter communication paths - stimulating employee innovation

Question 35

2 disadvantages of delayering

Answer 35

- wider spans of control | - potential loss of management expertise

Question 36

What is delayering

Answer 36

Removing a layer of management

Question 37

What is centralised decision making

Answer 37

Keeping decision making at the top of the hierarchy

Question 38

Advantages of centralisation (4) - independence - coordinate - costs and savings - decision making

Answer 38

- prevents other parts of the business from becoming too independent - easier to co-ordinate and control from the centre - economies of scale and overhead savings easier to achieve - quicker decision making- easier to show strong leadership

Question 39

Disadvantages of centralisation (3) - more layers - lack of authority - customer service

Answer 39

- more bureaucratic- often extra layers in the hierarchy - lack of authority down in the hierarchy may reduce manager motivation - customer service does mis ls flexibility and speed of local decision making

Question 40

What is decentralised decision making

Answer 40

Decision making is spread out to include more junior managers in the hierarchy, as well as individual business units or training locations

Question 41

Advantages of decentralisation (6) - decisions - responding - improved - consistent - training - motivation

Answer 41

- decisions are made closer to the customer - better able to respond to local circumstances - improved level of customer service - good way of training and developing junior management - should improve staff motivation

Question 42

Disadvantages of decentralisation (4) - decision making - practices - economies of scale - financial control

Answer 42

- decision making is not necessarily ‘strategic’ - harder to endure consistent practices and policies at each location - may be some diseconomies of scale - harder to achieve tight financial control- risk of cost overruns