unit 4 business

• Causes of change that could affect a business

  • Changing of technology
  • Changing of laws and regulations
  • Changing of customers expectations
  • Changing of competitors
  • Changing of employee expectations
• Changing of technology


  • Human Resource Management: Use teleworking to reduce overheads/labour costs, Carry out more off-the-job training via internet or software, Use recruitment websites
  • Production: CAD, CAM, EDI improve design, production and transactions
  • Marketing: Carry out worldwide research via internet, Advertise/sell worldwide, Website as advertisement tool, Conduct market research
  • Costs: Costs increase initially but then decrease over time, May lead to redundancies, Video conferencing reduces travel costs, Electronic payslips reduce costs
  • Opportunities: Increase in efficiency and economies of scale, More work with fewer employees, Wider market reach at lower cost, Larger markets to aim for, Reduced admin work for HR
• Changing of customers


  • Taste and fashions constantly changing, Increase in education leads to more quality conscious consumers, Increase in business competition leads to less customer loyalty, Ethical and environmental issues becoming more important in consumer choice
• Changing of competitors


  • Business constantly updating goods and services, Introduction of new and cheaper ways of doing business, Business availing of economies of scale, forcing smaller businesses to close
• Changing of employees


  • Highly educated and skilled workers, Want interesting, well-paid jobs with good working conditions, More diverse workforce with higher ethical standards
• Resistance to change


  • Psychology - people find it difficult to change, afraid of job loss, demotion, loss of pay and reputation
  • Confidence - management may lack confidence in workers' ability to cope, workers may lack confidence in their own ability
  • Communication - staff may be unaware of reasons for change
  • Disagreement - with reasons for change or fear changes will not work
  • Laziness - employees don't want the hassle involved
• How to manage change successfully

  1. Consultation and communication with staff

  2. Create a culture of change

  3. Training employees in new skills

  4. Teamwork and matrix/team structure

  5. Promote a facilitator management style

  6. Promote employee empowerment

  7. Promote a commitment to quality
• Controller to Facilitator Manager

  • Controller - autocratic style, employees have no say (Theory X)
  • Facilitator - trusts staff, values their ideas/views, less controlling (Theory Y)
• Facilitator Manager


  • Encourages employee empowerment, provides necessary resources
  • Provides interesting and challenging work
  • Encourages staff to achieve potential
  • Encourages training
  • Consults with staff regularly to get ideas and knowledge
  • Provides praise, recognition and rewards
• Employee empowerment


  Giving power and responsibility to workers, encouraging them to make their own decisions and take greater control of their jobs
• Improving employee empowerment


  1. Training for managers and employees

  2. Facilitator approach by managers

  3. Rewards to encourage taking on extra responsibilities

  4. Consultation - meet regularly and listen to staff ideas

  5. Teamwork - workers need to cooperate
• Teamwork


  • Bringing people together to work towards a common goal
  • Forming - right combination of skills, knowledge, problem solving and communication
  • Storming - members given roles but all have equal say
  • Norming - establishing good ground rules, dealing with conflicts
  • Performing - team works together to achieve goals
• Benefits of teamwork


  • Improved decisions from wider range of views and ideas
  • Improved motivation as employees have input
  • Increased job satisfaction reducing labour turnover
  • Allows employees to learn leadership skills
• Problems of teamwork


  • Personality clashes
  • Slow decision making
  • Strong personalities may dominate
• Total Quality Management (TQM)


  A concentrated and continued effort to create a culture of quality, where staff continually look for ways to improve quality
• Aims of TQM


  • Satisfying customer needs
  • Continuous improvement
  • Highest quality products and services
  • Teamwork and problem solving
  • Zero defects - eliminating faults
  • Create culture of continuous improvement and quality
  • Empowerment
• Implementing TQM


  1. Recruit high quality staff

  2. Increase customer satisfaction

  3. Produce highest quality goods

  4. Empower employees

  5. Encourage teamwork

  6. Quality discussions between all parts of the business
• Risk Management


  Identifies key business risks, their likely effect on the business and then putting in place a strategy to minimise them occurring and when they do, to resolve them as quickly as possible
• Advantages of TQM


  • Better quality goods and services
  • Increased customer satisfaction
  • Reduces waste and costs
  • Motivated staff feel part of continuous improvement
  • Improved company image, sales and profits
• Disadvantages of TQM


  • Slow implementation
  • Difficult to introduce a culture of quality - resistant to change
  • Requires staff commitment, will only work if all staff are motivated
• Risk Management


  1. Identifying possible risks

  2. Reducing the likelihood of the risk event occurring

  3. Taking out insurance on the reduced risk
• Possible risks


  • fire, theft, earthquakes
• Risk reduction methods


  • Fireproof materials in buildings/installing fire alarms and sprinkler systems
  • Installing proper security devices (locks, burglar alarms, safes, cameras, swipe card/coded doors)
  • Security systems in place for handling and transporting cash/valuables
  • Copies of valuable documents/computer data in separate location
  • Health and safety programmes to teach workers to use all equipment/machinery properly
  • Having a proper contingency plan in place to respond quickly to a disaster
• Insurance


  A contract whereby a person (insured) pays a fee (premium) to an insurance company (insurer) in return for a promise to compensate the insured in the event of a financial loss occurring
• Importance of insurance for a business


  • Business survival is protected
  • Improves cashflow
  • Exporting easier
  • May be a legal requirement
• Importance of insurance for a household

  • Financial security
  • Peace of mind
  • Savings can be enhanced
• Business insurance - Assets


  • Property Insurance
  • Cash & Valuables
  • Motor insurance
• Business insurance - Employees

  • Permanent Health
  • Key person
  • PRSI
  • Fidelity guarantee
• Business insurance - Liabilities


  • Public liability insurance
  • Product liability insurance
  • Employers liability
  • Consequential loss
• Personal insurance


  • House insurance: Buildings & Contents
  • Motor insurance
  • Mortgage Protection
  • General health insurance
  • Life assurance
  • Endowment life assurance
• Human Resource Management (HRM)

  The recruitment, training and retention of motivated staff and includes maintaining good industrial relations
• Taking out insurance


  1. Contact an insurance company or broker/agent

  2. Fill out a proposal form

  3. Risk is assessed and premium is calculated

  4. Cover note and Policy Issued

  5. Making a claim
• Human resource planning


  • Identifies the future staffing needs of the business and plans to have the right number of staff with the right skills set at the right time
  • Can also be called manpower planning
• HR Plan


  1. Train or upskill existing staff

  2. Promote staff to higher positions

  3. Redeploy staff to vacant jobs within the business

  4. Recruit new employees outside the business

  5. Downsizing – redundancies
• Proposal form


  Application form for insurance
• Recruitment and Selection Process

  1. Prepare job description

  2. Prepare a person specification

  3. Advertise vacancy

  4. Shortlist Applicants

  5. Interview and selection of most suitable candidate

  6. Check references

  7. Offer the job to successful applicant
• Premium


  The fee of the insurance, based on level of risk, value of the item, and loadings (extra charges)
• Job description


  Describes the vacancy that needs to be filled and includes: Job Title, Conditions, Duties, Responsibilities, Place of work, Supervision
• Person specification


  Describes the qualities required by the person who will fill the job description, including: Academic Qualification, Work experience, Physical fitness, Language skills
• Cover note


  Temporary document issued by the insurance company as proof of insurance contract before the policy is issued