Unit 2 Flashcards
Understanding Management, Leadership and Decision Making
Functions Of Management
(All made by Manager)
(All functions of Management involve decisions making)
Planning - Including setting objectives and analysing
Organising - Assembling the human and other resources needed
Directing - Leading and Communicating with other employees
Controlling - Reviewing and reporting on business performance
Autocratic Leadership Style (1/3)
Pros:
Quick Decision Making
Clear Direction
Efficient in Emergencies
Cons:
Lack of Employee Involvement
Reduced Creativity
Potential for Resentment
- Primarily one - way communication (downward)
- Minimal Delegation or Decentralisation (one person with authority)
- Close supervisions of employees
- One person controls all decisions with little input
Key Terms
Authority - the power or ability to carry through an action
Delegation - the passing of authority down the organisational structure
Empowerment - a series of actions designed to give employees greater control over their working lives
Decentralisation - entails passing authority from the centre of an organisation to those working elsewhere in the business
Democratic Leadership Style (2/3)
Pros:
Increased Staff Productivity
Builds a Strong Team
Diverse Ideas
Cons:
Slow decision making process
Not effective in crises
Chance of dealing with rejections
- The leader delegates a great deal and encourages decentralisation
- The leader and subordinates discuss issues and employee participation is actively encouraged
- Leader acts upon advice and explains the reasons for decisions
- Sub ordinates and empowered and have greater control over working life
Laissez - Faire Leadership Style (3/3)
Pros:
Empowers Employees Encourages Creativity and Innovation
Promotes self motivation
Cons:
Lack of structure and guidance
Potential for inadequate communication
Accountability Challenges
- Leader has minimal input into operations
- Employees are empowered
- Hands off allows employees to make decisions
Style Versatility
- Contention that there is not a single perfect style of leadership
- Arguement best managers are those who adopt a style suitable to the circumstances
- Can use democratic for reaching a decision on a proposed marketing campaign with a small group of people but may select a more autocratic style when dealing with a crisis
Influences on the styles of Management and Leadership
The Tradition and History of the Business:
- E.g. John lewis Partnership has a tradition of involving staff in decsions and a ‘considerate approach’
The Type of Labour Force
- Highly trained, skilled and confident employees may be more suited to democratic as they have the ability to contribute and bring perspectives managers may be unware of
The Nature Of The Task And The Timescale
- Good managers use style versatility e.g urgent short term task may recquire autocratic whereas scenario that calls for a highly creative, longer term approach may be better managed for laissez faire
The Personality of the Manager or Leader
- Confident individuals who are good with communication may be suited to the democratic style
- Decisive individuals with a strong vision of where the business should be going may be more autocratic
Decision Making Process
(Dynamic and on going process in which managers are continually engaged)
Setting Objectives
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Gathering and interpreting Information
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Selecting the chosen option
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Implementing the decision
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Reviewing
Key Terms
Programmed Decisions - familiar and routine decisions
Non - Programmed Decisions - less structured and require unique solutions
Risk - chance of incurring misfortune or loss
Uncertainty - a situation in which there is a lack of knowledge and events, outcomes or consequences are unpredictable
Opportunity Cost - next best alternative foregone
Programmed and Non - Programmed Decisions
(Types of Decisions)
Programmed Decisions:
- Familiar and routine
Non programmed:
- are less structured and require unique solutions
Tactical And Strategic Decisions
Strategic:
Long Term
Involves Large Commitment of Resources
Difficult to Reverse
Usually Taken By Senior Management
Tactical:
Short Term
Fewer Resources Involved
Easier to Reverse
Usually Taken by More Junior Management
Decision Making Based on Data
Pros:
Reduces the risk of making mistakes as decisions are based on data
Provides guiadance for managers who may have lack of experience or intuition
Cons:
Time consuming to collect all data required
Relying on data may lead to undertrained staff
May be out of data or unreliable leading to poor quality decision being made
- Decision making is made through:
Experience
Hunch/ Instinct
Scientific Decision Making
Scientific decision making is based on data and uses a logical, rational approach to decision making
Process Involves:
- Recognising problem or opportunity (recognising a decision has to be made)
- Setting Objectives for what you want to achieve
- Setting decision criteria and deciding how important each one is
- Developing and identifying alternatives
- Comparing alternatives using available data
- Choosing and then implementing the best course of action
- Reviewing the effectiveness of the decision
Decision Making Based on Intuition or ‘Hunch’
Pros:
- Based on experience and past intercounters
Cons:
- Emotionally bias
- Over confidence
-
Could be Appropriate:
- Decision making important assesment of a potential partners character
- assesing iof advertising campaign for a new product may catch the attention of consumers
- unsufficient qualitative data s supplied or when data contradicts previous thoughts
- Quick decision is necessary
Decision trees (on paper)
Influences on Decision Making
Decisions
(Tactical and Strategic)
(Programmable and Non Programmable)
1) External Environment (Forces outside the businesses control that can influence them)
- Demography
- Incomes
- Interest Rates
- Competition / Market Conditions
- Environment
2) Mission and Objectives
3) Resource Constraints
- Finance Materials
- Time
- People
4) Degree of Risk
5) Ethics (Moral principles (underpin decisions and actions)
- Fear of adverse publicity
- Moral Values
