Cover almost every topic in the AS syllabus.Full description
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business studies notesFull description
Business Studies notes for IGCSE. A detailed and easily understandable document.
This is a short test/ quiz for Business Studies (Chapter: Motivating Workers). The questions can be used for class discussion or revision at home.Full description
Business Studies textbook, by JacarandaFull description
This is a short test/ quiz for Business Studies (Chapter: Motivating Workers). The questions can be used for class discussion or revision at home.
A course book for Business Studies and Economics Students.Full description
Business Studies Business Studies HSC Textbook
A course book for Business Studies and Economics Students.
A course book for Business Studies and Economics Students.Descripción completa
intro to business studies
A course book for Business Studies and Economics Students.
commerce
Business Management Unit 1: Nature of management 1.1 Features of effective management - The traditional definition of definition of management is the process of coordinating a business’s resources to achieve its goals. - The four main resources are: - Human (employees. - !nformation (mar"et research# sales reports. - $hysical resources (e%uipment# machinery. - &inancial resources (funds. - ' manager is is someone ho coordinates the business’s limited limited resources in order to achieve specific goals. - The contemporary definition of definition of management management is the process of or"ing ith and through people to achieve the goals of the business in a rapidly changing environment. - )anagement re%uires: - *or"ing through others. - 'chieving the goals of the business (effectiveness. - +etting the most from limited resources (efficiency. - ,alancing efficiency and effectiveness. - oping ith a rapidly changing environment. - Effectiveness measures Effectiveness measures the degree to hich a goal has been achieved. - Efficiency compares Efficiency compares the resources needed to achieve a goal (the costs against hat as actually achieved (the benefits. 1.2 Skills of management - Interpersonal: Interpersonal: - elegate. - 'ctively listen. - ommunicate effectively. - Negotiate. - iscipline subordinates. - )otivate. - /ead. - 'n intrapreneur is is an individual ho ta"es on the entrepreneurial entrepreneurial roles ithin a business. - Communication: Communication: - Transmission of ideas and information throughout the business (via listening and technology. - 'are of any barriers that might prevent good communication. - 'void ambiguity. - reate an environment here people aren’t afraid to challenge ideas and put forard their vies. - Strategic Tinking: Tinking: - Thin" about the future. - )a"ing plans in an uncertain environment. environment. - !ision: !ision:
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- 'im for the ideal - everything going to plan. - 0ffective managers can turn hat they imagine into ords and communicate the vision to all the sta"eholders. - Typically# a highly competitive business producing %uality products. "ro#lem$Solving: - $roblems (challenges that needs to be overcome re%uire a great deal of thought and analysis. - 'dopt a systemic approach (define problem# evaluate alternative solutions# select best alternative. %ecision$Making: $ 'ssociated ith problem-solving. - Time needed to get info. analyse it and ma"e sound decisions. Fle&i#ility: - $utting into place systems and procedures enable the business to respond %uic"ly to changes in the eternal environment. - 0.g. placing employees on part-time during lo consumer demand# instead of dismissing them. 'dapta#ility to cange( - Uncertain environment: changes in consumer demand. - 0.g. )conald’s introducing fruits and salads. - 0.g. 2mart getting rid of T3’s as they focused on everyday lo prices. )econciling te conflicting interests of stakeolders: - ustomers4employees ant more benefits# but shareholders ant to minimise costs - )anager’s 5ob to fi these conflicts. - 0.g. 6ames Hardie and past employees suffering from asbestos poisoning.
1.* 'cieving #usiness goals - ' goal is a desired outcome or target that an individual or business intends to achieve ithin a certain time frame. - +oals benefit managers by: - 7erving as targets. - 'cting as measuring stic"s. - )otivation. - ommitment. - The best method of riting goals is using the 7.).'.8.T. method: - 7 9 7pecific (must be straightforard. - ) 9 )easurable (progress must be able to be measured. - ' 9 'chievable (must be ithin reach. - 8 9 8ealistic (must be something that managers and employees are illing to or" toards. - T 9 Time bound (must have deadlines. 1.*.1 Types of goals - &inancial +oals include: - )aimise profits. - !ncrease mar"et share. - )aimise groth. - !mprove share price.
- 7ocial +oals include: - ommunity service. - $rovision of employment. - 7ocial 5ustice. - 0nvironmental +oals include: - 7ustainable development. 1.*.2 'cieving a mi& of goals There are a range of goals due to the range of different sta"eholders ho have different needs# hich means a mi of goals are needed. !t is not easy to find the best balance# as there are conflicts beteen goals and compromises must be made (e.g. *almart has highly effective cost-reduction strategies but poor social goals# such as lo paid employees. 1.*.* Staff involvement - !nnovation includes: - !mportant in developing ne ays of conducting business activities. - )anagers developing ne ays of involving staff in the business so that they have a personal sta"e in the success of the business. - e.g. 2mart employees dressing up as popular characters# hich is effective and highly motivational. - )otivation includes: - 0mployees often need additional reasons# other than their age or salary# to be really involved in the business. - 8ecognition is a "ey strategy. *hen employees demonstrate superior customer service# managers notice and ith ac"noledgement and reinforce the behaviour. - )entoring includes: - )odern approach to employee4staff involvement. - )entoring is here the eperienced person in the business trains counsels another employee. - !t is an epensive strategy# but in the long term it’s a highly effective strategy as it leads to highly competent employees. - Socialisation is the process a ne employee undergoes in the first fe ee"s of employment through hich he or she learns ho to cope and succeed. - Training includes: - 7taff ill never really be involved in a business if they are unable to do their 5ob ell. - Training is about giving employees the s"ills they need to do their current 5ob ell. - The best result is a multi-s"illed employee. )ultis"illing allos employees to develop s"ills in a ide range of tas"s through ongoing training. - )ultis"illed employees: - 'dapt to a rapidly changing technological environment. - $rovide better customer service. - $articipate effectively in or" teams. - +ain promotions.
Unit ;: )anagement 'pproaches 2.1 Classical 'pproac
- )anagement stresses ho best to manage and organise or"ers so as to improve productivity (output. - The history of the approach: - *as developed during the industrial revolution due to mass production. - $roblems arose in training employees# organising management# scheduling manufacturing processes and dealing ith or" dissatisfaction. - ,usiness oners have to plan# organise# direct# control and staff different types of operations. - Classical$Scientific approac( - evised by &rederic" * Taylor. - 7cientific management: studies a 5ob in great detail to discover the best ay to perform it. - ivision of labour to improve efficiency and productivity. - )anagement to control or"ers and ensure they follo rules and regulations based on hierarchy of authority. - Classical$Bureaucratic approac - evised by )a *ebber and Henri &ayol. - 7et of rules and regulations that control a business. - 7trict hierarchical organisational structure. - lear lines of communication and responsibility. - ivision of labour. - 8ules and procedures. - years. - This level of planning ill assist in determining here in the mar"et the business ants to be. - *hat the business ants to achieve in relation to its competitors. - Tactical ,medium$term- planning( - !s fleible and adaptable planning. -
- The organisation process is the range of activities that translate the goals of the business into reality: 1. %etermining te /ork activities-or" activities re%uired to achieve management ob5ectives must be determined and bro"en don into smaller steps. ;. Classifying and grouping activities-similar activities can be grouped together to improve efficiency. =. 'ssigning /ork and delegating autority-determine ho is to carry out the or" and ho has responsibility to ensure that the or" is carried out. - Controlling compares hat as intended to happen ith hat has actually occurred.
$ Control metods is the need to monitor (chec" the %uality of the products being manufactured or provided - 0uality control( - !nvolves inspectors chec"ing finished products# and detecting and removing any components or final products that do not meet the re%uired standard. - This method can involve considerable aste# as substandard products have to be scrapped. - 0uality assurance -
2.1.2 ierarcical organisational structure $ Management ierarcy is the arrangement that provides increasing authority at higher levels of the hierarchy. - The primary characteristic of traditional hierarchical organisational structures has been the grouping of people according to the specialised functions they perform# such as mar"eting# finance# human resources and operations. -
- 8igid lines of communication. - Numerous levels of management. - learly distinguishable organisational positions# roles and responsibilities. - ' chain of command. - 7pecialisation of labour. - Specialisation of 3a#our refers to the degree to hich tas"s are divided into separate 5obs. - ' cain of command is a system that determines responsibility# supervision and accountability of members of the organisation. 2.1.* 'utocratic leadersip style - ' manager’s leadersip style is essentially their ay of doing things 9 their behaviour and attitude. - The t/o main types of leadership style are: - 'utocratic or authoritarian 9 strong# centrali?ed control - $articipative or democratic 9 authority and poer are decentrali?ed.
- )anagers should bring a range of leadership styles to their positions that can change according to the situation. - )ost managers typically have a dominant style.
$ ' manager using an autocratic leadersip style tends to ma"e all the decisions# dictates or" methods# limits or"er "noledge about hat needs to be done to the net step to be performed# fre%uently chec"s employee performance and sometimes gives feedbac" that is punitive. - The advantages of this style are: - irections and procedures are clearly defined.
- 0mployees’ roles and epectations are set out plainly# so management can monitor their performance. - $rovides a stable and constant environment. - ontrol is centralised at top-level management. The disadvantages of this style are: - No employee input alloed# so ideas are not encouraged or shared. - !t ignores the importance of employee morale and motivation. 6ob satisfaction decreases hich ultimately affects absenteeism and staff turnover. - onflict# or potential for conflict increases# and tension beteen employees. - 'n @us and them’ mentality may develop as a result of the lac" of employee input. 2.2 Beavioural approac - The #eavioural approac to management stresses that people (employees should be the main focus of the ay the in hich the business is organised. !t as pioneered by 0lton )ayo. - The main features of behavioural management approach include: - Humanistic approach: employees are the most important resource. - 0conomic and social needs of employees should be satisfied. - 0mployee participation in decision-ma"ing. - Team-based structure. - )anagers need good interpersonal s"ills. - emocratic leadership style emerging. 2.2.1 Management as leading+ motivating+ communicating - /eading: having a vision of here the business should be in the long and short term - )otivating: energising and encouraging employees to achieve the business’ goals - ommunicating: echanging information beteen peopleA the sending and receiving of messages. 2.2.2 Teams - Teamor" involves people ho interact regularly coordinate their or" toards a common goal. - *ell functioning teams can produce superior performance. - )anagers re%uire a good understanding of team4group dynamics. - The development of or" teams has resulted in flatter organisational structures. - The role of managers is changing from controller to facilitator. - ,usinesses are adopting flatter management structures hich results in: - @de-layering’ of traditional hierarchical structure - establishment of mar"et-focused or" teams - each or" team responsible for a ide range of production functions. - 8educing the levels of management gives greater responsibility to individuals in the business. - &latter organisational structures have evolved due to a @de-layering’ of management structures resulting in the elimination of one or more management levels. 2.2.* "articipative4democratic leadersip style
- ' participative or democratic leadership style is one in hich the manager consults ith employees to as" their suggestions and then seriously considers those suggestions hen ma"ing decisions. - The main advantages of this style are: - ommunication is a to ay process. - 0mployer4 employee relations are positive and there is reduced li"elihood of industrial disputes. - )otivation and 5ob satisfaction are optimal. - 0mployees have a greater opportunity to ac%uire more s"ills. - $oer sharing encourages the development of or" teams and employees display high levels of commitment. - There is a high level of trust. - The main disadvantages of this style are: - 8eaching decisions and introducing tas"s can be time consuming. The %uality of decisions may also suffer due to compromises. - The role of management may be ea"ened and undermined. - !nternal conflict may arise ith so many vies and opinions. - The importance of the organisational structure may be minimised# leading to an informal system. - Not all employees ant to contribute. 2.* Contingency approac - The contingency approach stresses the need for fleibility and adaption of management practices and ideas to suit changing circumstances. - ue to the unstable business environment# managers need to be fleible and borro and blend from a ide range of management approaches.
Unit =: )anagement $rocess *.1 Co$ordinating key #usiness functions and resources - 7trategies are the actions that a business ta"es to achieve specific goals. -
*.2.2 Te production process - The three "ey elements of the production process include inputs# the transformation process and outputs. - !nputs are resources used in the production process and include ra materials (e.g. st eel# capital e%uipment (e.g. machinery# labour (e.g. or"er# information# time and money. - The transformation process is the conversion of inputs into outputs. - 0laborately transformed manufactures (0T)s are manufactured goods that are highly processed and valued. - 7imply transformed manufactures (7T)s are goods that can be further processed in a ide range of processes. - 3alue added is the creation of etra or added value as ra materials are transformed into intermediate or finished products through the stages of production. - Transformation processes in service businesses are less physical and ta"e the form of "noledge# inputs and epertise. - Transformation by service businesses differ from a good because the output cannot be physically held in stoc" and they rely heavily on the interaction ith the customer. -
- )ar"et segmentation occurs hen the total mar"et is subdivided into groups of people ho share one or more common characteristic. - onsumer buying behaviour refers to the decisions and actions of consumers hen they purchase goods and services for personal household use. - ' target mar"et refers to the group of customers to hich a business intends to sell its product. !t better satisfies the needs of the group# because the business can: - use its mar"eting resources more efficiently - better understand the consumer buying behaviour of the target mar"et - collect data more effectively and ma"e comparisons - refine mar"eting strategies used to influence consumer choice - ,oth primary and secondary target mar"ets are utilised. - ' niche mar"et is a narroly selected target mar"et segment. *.*.2 Marketing Mi& - )ar"eting strategies are actions underta"en to achieve the business’s mar"eting goals through the mar"eting mi. - ' business controls four basic mar"eting strategies to reach its target mar"et: product# price# promotion and place (the four $s of the mar"eting mi. - ' product can be goods or service# and consists of both tangible and intangible features. "roduct - $roduct positioning is the development of a product image compared ith the image of the competing products. - $ac"aging helps preserve# inform# protect and promote the product. - $roduct branding is the brand and associated brand logo. "rice - ' business must select the most appropriate pricing method suitable to its product and mar"et conditions. - Cost plus margin 9 calculating the total cost of production and adding a percentage for profit. - Discount price 9 reducing the price of stoc" that is not selling to stimulate demand. - Competitors’ price 9 choosing a price that is either blo# e%ual to or above that of the competitors. - Market price 9 pricing according to the interactions beteen the %uantity that customers are illing to purchase. "romotion - $romotion refers to the methods used by a business to inform# persuade and remind customers about its products. - Personal selling 9 a sales assistant outlines the features of the goods or service to the customer. - Sales promotion 9 activities and materials are used to attract interest and support for the good or service (e.g. coupons and free samples. - Publicity 9 the business sets up a free nes story about its product. - Advertising 9 print or electronic mass media are used to communicate a message about the product. "lace - hannels of distribution (place is a ay of getting the product to the customer. - Producer to customer 9 this is the simplest channel and involves no intermediaries.
- Producer to retailer to customer 9 this channel is often used for bul"y or perishable products. - Producer to wholesaler to retailer to customer - this is the most used method. *.6 Finance - 'ccounting is a financial management tool that is involved ith the recording and analysis of all the business’s financial transactions. - &inance details ho a business funds its activities. - ontingencies are unanticipated events that can lead to financial difficulty. - !t is vital for a business to be able to manage its borroings and to use appropriate types of borroings. - There are three main financial statements created by accounting processes: the cash flo statement# the income statement (also called revenue statement# profit and loss ($/ statement or statement of financial performance# and the balance sheet (or statement of financial position. *.6.1 Cas flo/ statement - ' cash flo statement shos the movement of cash receipts (inflos and cash receipts (outflos over a period of time. - /i%uidity is used to describe hether a business has a good or ade%uate cash flo. - ash flo reports are vital for the information they give on the timing of payments and receipts of income. - ash flo statements are divided into three categories: cash flos from operating activities# those from investing activities and those from financing activities.
*.6.2 Income Statement - The income statement is a summary of the income earned and the epenses incurred over a trading period. - The main classification of items in the income statement are revenues# cost of goods sold (<+7 and epenses. - Gross proit ! Sales - Cost o goods sold "C#GS$ - C#GS ! #pening stock % Purchases - Closing stock - 0penses are simply costs and can be bro"en don into selling# administrative or financial. - 7elling costs include commission# salaries# ages# advertising# delivery epenses# electricity.
- 'dministrative costs include stationary# office salaries# rent# rates# telephone# audit fees# accountant’s fees# insurance. - &inancial costs include interest payments# lease payments# dividends and insurance payments. - They can also be classified as operating or non-operating.
- &et proit ! Gross proit ' ()penses *.6.* Balance Seet - The balance sheet shos the overall financial stability of the business. - The main items in the balance sheet are assets# liabilities and oners’ e%uity. - 'ssets are items of value to the business and can be either current or non current. - /iabilities are debts or business borroing and can be either current or non current. - <ner’s e%uity items refers to the oners’ claims and is considered a liability from the point of vie of the business. - The balance sheet should alays balance. - This means the assets must e%ual the liabilities.
- The balance sheet e%uation is: Assets ! *iabilities % #wner’s e+uity or A ! * % #( .
*.7 uman )esources - Human resource management is the effective management of the formal relationship beteen the employer and the employee. - The main functions of staffing are to attract and ac%uire# train and develop# reard# maintain# and separate the people needed to achieve the business’s goals. *.7.1 )ecruitment - Human resource planning involves developing strategies to meet the business’s future staffing needs. - ' 5ob analysis is a systematic study of each employee’s duties# tas"s and or" environment. !t comprises a 5ob description and 5ob specification. - ' 5ob description is a ritten statement describing the employeeEs duties# tas"s and responsibilities. - ' 5ob specification is the list of "ey %ualifications needed to perform a 5ob in terms of education# s"ills and eperience. - 'fter the planning stage# the recruitment of staff commences to find the best person for the 5ob. - 8ecruitment involves finding and attracting the right people to apply for a 5ob vacancy. - ' business can recruit from staff ithin the business (internal or see" ne applicants from outside sources (eternal. -
- Training provides employees ith the right "noledge and s"ills to perform their 5ob effectively and efficiently. - evelopment focuses on preparing the employee to ta"e on more responsibilities ithin the business in the future. -
- 8etrenchment is hen a business dismisses an employee because there is not enough or" to 5ustify paying them. - Unfair dismissal occurs hen an employer dismisses an employee for discriminatory reasons. - The final stage in the employment cycle is the @separation stage’# in hich employees leave the or"place on a voluntary or involuntary basis. - This stage must be handled carefully and sensitively by the human resource manager. *.8 Etical Business Beaviour - The ma5ority of businesses ant to be seen as responsible corporate citi?ens. - The triple bottom line refers to the economic# environmental and social performance of a business. - 0thics are standards that define hat is acceptable and unacceptable behaviour. - ,usiness ethics is the application of moral standards to business behaviour such as: - fair and honest business practices - decent or"place relations - conflict of interest situations - accurate financial management - truthful communication. - ' corporate code of conduct encourages ethical business behaviour.
Unit G: )anagement and hange 6.1 )esponding to internal and e&ternal influences - hange is any alteration in the business environment. - hanges can be ma5or (transformational or minor (incremental. - *hen a business responds to the forces of change# the result ill be a change to its: - organisational structure - including outsourcing# flatter structures and or" teams - business culture - for a business to survive in the long term# changes should be reflected in its culture - human resource management practices - including recruitment and selection. training# performance appraisal# and redundancy procedures - operations management - including fleible manufacturing and %uality assurances. 6.2 Managing Cange Effectively - To manage change effectively re%uires the change to be as productive as possibleA to ma"e it a process for revitalising and strengthening the business. - )anagers must develop strategies for managing change effectively. - ' business information system (,!7 gathers data# organises and summarises them and then converts them into practical information to be used by managers ho use them to ma"e decisions. - )anipulation and threat are to high-ris" strategies for managing change. 6.2.1 Identifying te need for cange - !dentifying the need for change and setting achievable goals are to lo-ris" strategies for managing change. - ' business’s success or failure to accurately identify hat needs to be changed depends on its ability to collect# organise# process and retrieve information %uic"ly.
resistance to change management consultants. 6.2.2 Setting 'cieva#le 5oals - ' vision statement states the purpose of the business. - Unachievable goals ill cause cynicism among employees and damage relationships beteen employees and supervisors. - +oals devised after consultation ith employees and communicated clearly have a greater chance of being realised. 6.2.* )esistance to Cange - 't the same time as managers are underta"ing change for the best of reasons# there ill be restraining forces or"ing against t he change# creating resistance. - The main reasons for resistance to change include: - management (may ma"e hasty decisions or be indecisive - fear of 5ob loss (fearful of changes that threaten 5ob security or re%uire ne or" routines - disruption to routine (orried that t hey cannot adapt to the ne procedures that threaten established or" routines - time (either poor timing# or lac" of time - fear of the un"non (feelings of lac" of control and aniety - inertia (prefer to stay ith the safe and predictable status %uo - cost (financial cost of implementing ma5or changes can be substantial. - riving forces are those forces that initiate# encourage and support the change. - 8estraining forces are those that or" against the change# creating resistance. - 8esistance to change is common among managers and employees. - To strategies for overcoming resistance to change include: - creating a culture of change (encouraging teamor" - providing positive leadership (sharing the vision. 6.2.6 Management Consultants - ' management consultant is someone ho has specialised "noledge and s"ills ithin an area of business. - They provide: - a ide range of business eperiences - specialised "noledge and s"ills - an ob5ective viepoint - access to the latest research - aareness of industry best practices (the highest standard - hange management is a methodical approach to dealing ith change# both from the perspective of the business and on the individual level. - )anagement consultants can provide strategies by: - underta"ing change readiness revies - creating a supportive business culture - actively involving all sta"eholders in the change process - gaining and recognising early achievements