Unit 2 Flashcards
Managers, leadership and decision making
What do managers do?
- Set objectives- set goals for a group and decide what needs to be done
- Organise- divide the work into manageable activities and select people to undertake them
- Motivate and communicate- create a team of people to work together
- Measure- analyse and appraise performance
- Develop people
Leadership styles
-autocratic leaders
-democratic leaders
-paternalistic leaders
-laissez-faire leaders
Autocratic leaders
Make decisions without consulting others
Democratic leaders
Make the final decision but include others in the process
Paternalistic leaders
Consult and try to make decisions in the best interest of all
Laissez-faire leadership
Allow team members freedom if they do their work and meet deadlines
Stages of Tannenbaum Schmidt’s continuum
Tells- manager makes decisions and announces
Sells- manager ‘sells’ decisions
Suggests- manager presents ideas and invites suggestions
Consults- manager presents tentative decision subject to change
Shares- manager defines limits and asks the group to make a decision
Delegates- manager permits subordinates to function within the limits defined by superior
Advantages & disadvantages of democratic leadership
-useful when complex decisions requiring a range of specialist skills
-commitment to business, satisfaction and quality of work may improve
-slow decision making and need for consensus may make it hard to take ‘best’ decisions
Advantages & disadvantages of autocratic leadership
-useful when quick decisions are required
-decisions and direction of business will be consistent
-may project image of confident, well managed business
-lack of information, so subordinates are highly dependent on leaders
-supervision needed
Advantages & disadvantages of laissez-faire leadership
-can encourage production of highly creative work by subordinates
-may bring the best out of highly professional or creative groups
-may not be deliberate but bad management
-staff lack of focus and sense of direction
-much dissatisfaction
Influences on leadership style
Individual- some leaders feel they always have to be in control whereas others may feel more comfortable discussing decisions
Nature of industry- some industries require a high degree of creativity
Business culture- if a business has a tradition of doing things in a particular way, then this might determine the style adopted
What is scientific decision making?
Decision making that is based on data and uses a logical and rational approach
Opportunity cost
The cost of next best alternative that will be missed by making a particular decision.
What is intuition?
Making decisions based on gut feeling rather than on data and rational analysis
What are decision trees?
Tree like diagrams that can be used to determine the optimum course of action in situations where several possible alternatives with uncertain outcomes exist.
Benefit & limitations of a decision tree
-can be a useful analytical tool as they make managers think and quantify decisions rather than rely on intuition
- managers may be influenced by their own bias towards one decision rather than another and may make the returns for their favoured approach more attractive
-the probabilities are just guesses and may not be very accurate
Influences on decision making
Mission and objectives- its essential purpose
Ethics- are decisions morally correct
External environment- a downturn in the economy or a rise in interest rates may have an impact on decision making
Competition- other business may affect the decisions made
Resource constraints- there is a limit to what a business can physically do
Stakeholders examples and interests
-employees- job security
-customers- good customer service and value for money
-shareholders- capital growth and dividends
-suppliers- regular order and on time payment
-local communities- avoidance of pollution and congestion, and employment
-government- employment and payment of taxes
What diagram shows stakeholder mapping
Mendelow’s matrix
Low power, low interest stakeholders
Least important
-inform via general communications: newsletters, websites, mail shits
-aim to move into right hand box (more interest)
High interest, low power stakeholders
Show consideration
-make use of internet through involvement in low risk areas
-keep informed and consult on interest area
-potential supporter/goodwill ambassador
Low interest, high power stakeholders
Meet their needs
-engage and consult on interest area
-try to increase level of interest
-aim to move into right hand box (more power)
High interest, high power stakeholders
Key player
-key players focus efforts on this group
-involve governance/ decision making bodies
-engage and consult regularly
Influences on the relationship with stakeholders
-leadership styles
-business objectives
-government
-state of economy
