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A Level Key Terms & Formulas > Unit 2 - Managers, leadership and decision-making > Flashcards

Unit 2 - Managers, leadership and decision-making Flashcards

1
Q

What do managers do according to Pater Drucker?

A

1) Set objectives - The manager sets goals for a group and decides what work needs to be done.
2) Organise - The manager divides the work into manageable activities and selects the people to undertake them.
3) Motivate and communicate - The manager c creates a team that works together.
4) Measure - The manager not only sets targets but analyses and appraises performance.
5) Develop people - It is up to the manager to develop people who may be looked upon as the most important asset of a business.

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2
Q

What is Henri Fayol’s five elements of management?

A

1) Planning
2) Organising
3) Commanding
4) Coordinating
5) Controlling

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3
Q

What is meant by leadership style?

A

Leadership style is the way in which a leader approaches his/her role of planning, organising, directing, and controlling.

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4
Q

What are the three basic styles of leadership?

A

1) Autocratic leaders
2) Democratic leaders
3) Laissez-faire leaders

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5
Q

Name and describe all styles of leadership?

A

1) Autocratic leaders - Makes decisions without consulting others.
2) Democratic leaders - Make the final decision but include others in the process.
3) Laissez-faire leaders - Allows team members more freedom if they do their work and meet deadlines.
4) Charismatic leaders - Leaders who believe they can do no wrong.
5) Paternalistic leaders - Leaders who consult and try to make decisions in the best interest of all.
6) Bureaucratic leaders - Leaders who do everything exactly by the rules.

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6
Q

What are the 5 leadership styles included with Blake and Mouton’s leadership grid?

A

1) Country club management - (HIGH concern for PEOPLE and LOW concern for PRODUCTION)
2) Impoverished management - (LOW concern for PEOPLE and LOW concern for PRODUCTION)
3) Team management - (HIGH concern for PEOPLE and HIGH concern for PRODUCTION)
4) Authority-compliance management - (LOW concern for PEOPLE and HIGH concern for PRODUCTION)
5) Middle-of-the-road management - (MEDUIM concern for PEOPLE and MEDIUM concern for PRODUCTION)

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7
Q

Give a breif summary of democratic leadership.

A

Democratic leadership entails running a business on the basis of decisions agreed by the majority.

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8
Q

Give a brief summary of authoritarian leadership.

A

An authoritarian leadership style keeps information and decision-making among the senior managers.

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9
Q

Give a brief summary of laissez-faire leadership.

A

Laissez-faire leadership means the leader has a peripheral role, leaving staff to manage the business.

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10
Q

What are the key features of democratic leadership.

A

Democratic leadership encourages participation and makes use of delegation

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11
Q

What are the key features of authoritarian leadership.

A

Authoritarian leadership sets objectives and allocates tasks (THE LEADER RETAINS CONTROL THROUGHOUT)

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12
Q

What are the key features of laissez-faire leadership.

A

Laissez-faire leaders evades duties of management and uncoordinated delegation occurs.

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13
Q

What are the uses of democratic leadership.

A

When complex decisions are made requiring a range of specialist skills.

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14
Q

What are the uses of authoritarian leadership.

A

Useful when quick decisions are required.

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15
Q

What are the uses of laissez-faire leadership.

A

Can encourage production of highly creative work by subordinates.

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16
Q

What are the advantages and disadvantages of democratic leadership.

A

ADVANTAGES: Commitment to business, satisfaction and quality of work may all improve.

DISADVANTAGES: Slow decision-making and need for consensus may avoid taking ‘best’ decisions.

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17
Q

What are the advantages and disadvantages of authoritarian leadership.

A

ADVANTAGES: Decisions and direction of business will be consistent. May project image of confident, well-managed business.

DISADVANTAGES: Lack of information, so subordinates are highly dependent on leaders; supervision needed.

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18
Q

What are the advantages and disadvantages of laissez-faire leadership.

A

ADVANTAGES: May bring the best out of highly professional or creative groups.

DISADVANTAGES: May not be deliberate, but bad management- staff lack of focus and sense of direction. Much dissatisfaction.

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19
Q

What are the key influences that may effect what type of leadership style the business adopts?

A

THE INDIVIDUAL - Some leaders feel they always have to be in control and may lean more towards an autocratic approach or a democratic approach if the leader(s) wish to discuss decisions.

NATURE OF THE INDUSTRY - Some industries require a high degree of creativity, whereas with others safety might be paramount. The leadership style adopted is likely to reflect this with a more lasses-faire approach adopted where creativity is need and a more autocratic approach where safety is of concern.

BUSINESS CULTURE - If a business has a tradition of doing things in a particular way, this this might determine the style adopted. It may have always operated with a more laissez-faire or autocratic approach that might prove difficult to change.

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20
Q

Identify four key aspects of a leader’s role.

A

1) Setting objectives
2) Organising the way work is performed
3) Motivating and communicating
4) Analysing and appraising performance

21
Q

State three influences on leadership style.

A

1) The leader’s personality and skills
2) The nature of the industry
3) The culture of the business

22
Q

How are leaders classified in the Tannenbaum and Schmidt continuum?

A

In the Tannenbaum and Schmidt continuum, leaders are classified according to how much they tell or listen to workers.

23
Q

Define SCIENTIFIC DECISION MAKING.

A

Scientific decision-making is decision-making based on data that uses a logical and rational approach.

24
Q

Define OPPORTUNITY COST

A

The opportunity cost is the next best alternative.

25
Q

Define INTUITION

A

Intuition is making decisions based on gut feeling rather than data and rational analysis.

26
Q

Define DECISION TREE

A

Decision trees are tree-like diagrams showing various options, their probabilities and financial outcomes.

27
Q

Identify three key pieces of information required for a decision tree.

A

1) The cost of each decision
2) The financial outcome
3) The probability

28
Q

Briefly outline the benefits and drawbacks of decision trees.

A

Decisions trees have the benefit that they make managers think about and quantify outcomes, which can help reduce risk in decision-making. They do, however, have the drawback that they can be open to a manager’s bias
- outcomes and probabilities may be made more favourable in order to have a particular decision accepted.

29
Q

Briefly outline how the external environment may impact on decision-making.

A

The external environment may have a big impact on decision-making. A downturn in the economy or rise in interest rates could see decisions being postponed or even abandoned altogether, whereas an expanding economy or fall in interest rates might see decisions being brought forward.

30
Q

List four other influences on decision-making

A

1) Competition
2) Resources available
3) Ethics
4) Business objectives

31
Q

Define STAKEHOLDER

A

A stakeholder is any individual or group who has an interest in the activities and performance of a business.

32
Q

How does Mendelow categorise stakeholders in his matrix?

A

Mendelow categorises stakeholders according to the amount of power they have and their level of interest.

33
Q

Briefly outline the key to managing stakeholder relations.

A

The key to managing stakeholder relations is likely to be good communication with participation and involvement in decision-making.

34
Q

Give a few examples of stakeholders and the reasons why they are stakeholders.

A

1) Employees - job security, good working conditions and pay
2) Customers - good customer service and value for money
3) Shareholders - capital growth and dividends
4) Suppliers - regular orders and on-time payment
5) Local communities - avoidance of pollution and congestion, employment
6) Government - employment, payment of taxes

35
Q

What is Mendelow’s matrix?

A

Mendelow’s matrix is a stakeholder map where stakeholders are categorised according to the amount of power they have and their level of interest.

36
Q

What decisions could potentially cause OVERLAP and CONFLICT of stakeholders interests?

A

Relocate overseas

Introduce new technology

Expand production

Increase price

Cut costs

Enter new markets/products

37
Q

What stakeholders interests may OVERLAP with business’s decision to RELOCATE OVERSEAS and why?

A

Shareholders: potential for lower costs and increased profit.

Management: achieve objectives in terms of costs and profit

38
Q

What stakeholders interests may OVERLAP with business’s decision to INTRODUCE NEW TECHNOLOGY and why?

A

Shareholders and management: lower costs and potential profit.

Consumer: may result in better quality and reliability.

39
Q

What stakeholders interests may OVERLAP with business’s decision to EXPAND PRODUCTION and why?

A

Shareholders: higher sales and profit.

Employees: job opportunities.

Customers: greater availability.

Suppliers: more orders.

Government: tax.

Community: greater production.

40
Q

What stakeholders interests may OVERLAP with business’s decision to INCREASE PRICE and why?

A

Shareholders: potential profit increase.

Management: improved performance.

Government: more tax.

41
Q

What stakeholders interests may OVERLAP with business’s decision to CUT COSTS and why?

A

Shareholders: potential profit.

Management: achieving objectives.

42
Q

What stakeholders interests may OVERLAP with business’s decision to ENTER NEW MARKETS/PRODUCTS and why?

A

Shareholders: potential profit.

Employees: job security.

Suppliers: increased orders.

Community: greater employment.

43
Q

What stakeholders interests may CONFLICT with business’s decision to RELOCATE OVERSEAS why?

A

Local community: impact on local economy.

Employees: lost jobs.

Government: less tax.

44
Q

What stakeholders interests may CONFLICT with business’s decision to INTRODUCE NEW TECHNOLOGY and why?

A

Employees: may lose jobs

Less employment: could impact on local community.

45
Q

What stakeholders interests may CONFLICT with business’s decision to EXPAND PRODUCTION and why?

A

Local community: greater congestion and pollution.

46
Q

What stakeholders interests may CONFLICT with business’s decision to INCREASE PRICE and why?

A

Customers: cost more.

47
Q

What stakeholders interests may CONFLICT with business’s decision to CUT COSTS and why?

A

Employees: potential job loss.

Customers: quality might be affected.

Suppliers: pressure on prices.

48
Q

What stakeholders interests may CONFLICT with business’s decision to ENTER NEW MARKETS/PRODUCTS and why?

A

Local community: pollution due to increased production.

49
Q

Besides the power and interest of individual stakeholders, identify 4 other influences on the relationship with stakeholders.

A

1) Leadership styles - An authoritarian leader may have little concern for individual stakeholder groups therefore worsening the relationship between the business and that particular stakeholder group.
2) Business objectives - Some businesses may be committed to an ethical approach in their decision-making whilst others may be less concerned.

EXAMPLE: The Body Shop is committed to not testing on animals and therefore attracts less attention from pressure groups.

3) Government - Legislation introduced by the government (or EU) can affect relationships with stakeholders.

EXAMPLE: Include legislation regarding employment, the environment or safety.

4) State of economy - When economic and market conditions are booming, it is easier for a business to address issues related to stakeholders as people would have more disposable income to spend.

A Level Key Terms & Formulas (7 decks)

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