Business Management

• Financial methods of motivation

  • Time rate
  • Piece-rate
  • Commission
  • Profit Sharing
• Time rate


  Employees are paid an exact amount per hour or days they work. The more an employee works the larger the wage they will receive.
• Piece-rate


  Employees are paid per item they produce. The more productive an employee will be, the higher the wage they will receive. This will encourage people to sell more as they work harder and produce more.
• Commission


  Employees are paid a percentage of the value of their sales.
• Profit Sharing


  Employees will receive a share or percentage of the profit made by the organisation. This will motivate employees to work productively because the more profitable the organisation is the more money the employee will receive.
• Solving cash flow problems

  1. Find a cheaper supplier

  2. Lease machinery or equipment instead of buying

  3. Arrange extra time to pay bills from suppliers (increase credit terms)

  4. Increase advertising and promotion to increase sales
• Supplier is too expensive

  Find a cheaper supplier
• Machinery or equipment is too expensive to buy

  Lease it instead
• Cannot pay company bills on time

  Arrange extra time to pay bills from suppliers (increase credit terms)
• Not enough sales


  Increase advertising and promotion
• Recyclable packaging


  Helps the environment and gives the business a good reputation
• Quality fabrics used


  Means consumers are satisfied. This gives the business a good reputation and keeps customers coming back
• Repair/recycle service offered to customers

  If something is damaged, the business offers to repair it for the customer. This may lead to customers feeling valued and positive reviews on the business
• Charity work


  Working with charities can give the business a good reputation and convince customers to buy from you as they are supporting a good cause
• Methods Lyle and Scott uses to promote its business

  1. Celebrity endorsement

  2. Discounts

  3. Half-price sales

  4. Special offers
• Celebrity endorsement


  It reaches a large amount of people if the celebrity has a large following. This can help promote the business on a large scale
• Discounts


  New customers are engaged and buying at first, which keeps them coming back
• Half-price sales


  Frequent half-price sales keep customers engaged and buying when the sales happen
• Special offers


  Customers are engaged and buying when special offers are on
• Lyle and Scott operates in the tertiary sector
• Other sectors of industry

  • Primary - Raw materials extracted from the earth
  • Secondary - Manufacturing of the product
• Bank loan


  Has to be paid back, whereas a government grant does not
• Bank loan


  Fairly easy to get, whereas a government grant is only given to a few people
• Good quality raw materials/materials

  Lyle and Scott uses to ensure quality
• Checking quality at every stage of production means less faults are made in future products
• Checking casework and documents at every stage is time-consuming and unmotivating for employees
• Finding faults quickly means less wastage, which could give the business a good reputation
• Leaving the company


  Results in a waste of money paid to train them
• Training employees


  Is expensive as it costs money to send them to college
• Training employees


  Means someone else has to replace them while they are doing the training
• Striking


  Employees not coming into work will not gain a good reputation for the business, although it may help them get better pay
• Methods of industrial action

  • Sit-in
  • Overtime ban
  • Picketing/protest
• Sit-in


  Employees sit in the workplace and do nothing, meaning no work is being done
• Overtime ban


  Employees will not do any overtime, meaning work may not get finished on time
• Picketing/protest


  Employees stand outside the company with signs and protest what they believe in, during which time no work is done
• Holding video interviews


  Can help recruit the right candidate for the business
• Training employees online


  Helps them know what to do and be better at their job
• Cash budgeting


  Allows easy calculations and creation of graphs to understand financial information
• Job production


  Can be customized as it is not stuck to a specific standard, making the product unique. It also allows more care and time to be spent on each product, resulting in better quality, but is usually more expensive.
• Being ethical


  Helps the business earn a good reputation with customers, attract new customers, and potentially earn awards