organisational design business

• Organisational design


  The framework that provides a business with a structure to achieve its objectives
• Organisational structure

  The levels of management and division of responsibilities within an organisation
• Tall and thin structures

  Occur when each superior is responsible for a few subordinates this allows for closer supervisor and communication between 2 levels
• Wide and flat

  Each superior is responsible for a large number of subordinates this requires greater delegation but fewer levels allowing for quicker communication through the firm
• Chain of command

  Way authority and power is passed down the levels of hierarchy
• Authority

  the right to use power
• Centralised

  Maintained by a few of the centre of organisation
• Decentralised

  Spread across the organisation, authority can act as a motivator
• Hard HRM


  an approach to managing staff that focuses on cutting costs

  E.g.

  Control mechanisms

  Fixed term contracts

  Minimum wage

  tall organisational structure
• Soft HRM


  an approach to managing staff that focuses on developing staff so that they reach self-fulfillment and are motivated to work hard and stay with the business

  
  

  E.g. opportunities for staff development

  Consultation

  Training - internal promotion
• Strengths of Hard HRM

  Fixed term contracts

  Lower costs, minimum wage
• Weaknesses hard HRM


  Less flexible workplace

  Decreases productivity

  Less promotional opportunities - demotivates staff
• Strength of soft HRM

  Opportunities for staff development

  Empowerment

  Motivated staff

  Multi skilled workforce
• Weaknesses for soft HRM

  A large focus on employees can mean a lack of focus on corporate goals and strategies

  • costly to include bonuses, awards and recognition ( Above minimum wage)

  • employees may choose not to complete the work
• Multi skilling


  The process of increasing the skills of employees
• Flexible workforce


  A workforce that can respond, in quantity and type, to changes in market demand
• Part time employees advantages

  Greater flexibility- more affordable option

  Increases amount of applicants for a position

  Can retain valued workers who can no longer work full time
• Temporary employees


  hired for a specified period of time, typically to assist with heavy work periods or to temporarily replace an employee on leave
• Temp employees Benefits and issues

  Flexible work force

  Better able to mention supply to demand

  Not held into paying workers when they've not used to full potential

  
  

  However;

  Recruitment + training costs are high when employees aren't permanent

  May leak commitment
• Outsourcing


  Provides flexibility in supply, can increase capacity without high expectations
• Ability to work from home +


  Reduces cost to employer

  Made easier by advances in technology
• dismissal


  being sent away; being removed from a duty, position, or employment
• unfair dismissal


  Ending a worker's employment contract for a reason that the law regards as being unfair

  
  

  E.g. pregnancy
• redundancy


  Job no longer exits

  This can be from;

  Closure, new technology, relocation
• primary data is information collected first hand by asking people questions directly
• market research is finding out about customers, competitors and markets
• market research is finding out about customers' needs, wants and preferences so that businesses can make informed decisions
• a market is the place where buyers and sellers meet to exchange goods or services
• Whistleblowing is the act of reporting unethical or illegal activities within an organization to internal or external authorities.
• What is an entrepreneur? (1.5.1)

  A person who sets up a business taking risk on of the new business activity with the aim of gaining a reward, usually profit.
• What are some of their key roles?

  -Creating and setting up a business.

  -Running and developing a business.

  -Bringing innovation to the business world.

  -Overcoming barriers to entrepreneurship.

  -Anticipating risk and uncertainties.
• How does an entrepreneur create and set up a business?

  -Needs to identify gap in the market and a need for a product.

  -Once confident create a business plan.

  -Research their business idea like marketing mix location and what finance is needed.

  -Need to decide all ownership, Usually as a sole trader.

  -Need to raise the money to start the business and acquire all the other resources they need.
• How does an entrepreneur run and develop a business?

  -Once its started trading, need to keep the business running by keeping up-to-date with things like the law business sales, marketing techniques, continue market research, continue to set aims and objectives.

  -As business grows, it becomes harder for them to manage all business functions, so they hire more employees to help manage different areas of the business.
• How does an entrepreneur bring innovation to the business world?

  -They need to be innovative, need to think of new products and be prepared to take on risk of making these new ideas A reality.

  -May not think about this personally, employ staff and encourage workers to be innovative.

  -When employee shows entrepreneurial skills shows intrepreneurship.
• How do entrepreneurs overcome barriers to entrepreneurship?

  -Overcome of lack of money for business by raising capital.

  -When they lack confidence, overcome by developing a strong belief.

  -May not have had training so they should make sure they learn as much as they can about running a business.

  -A firm might lack entrepreneurial capacity, the ability to identify growth and development opportunities to overcome need to develop their businesses entrepreneurial capacity.
• What does an entrepreneur anticipate risk and uncertainty?

  -Make conscious decision about whether or not to take risk, way up positive and negative.

  -Often considered that the riskier a project the greater the potential financial gains.

  -Uncertainty differ from rest as its usually unpredictable, tend to be associated with external factors:

  Health scares, exchange rates, political factors, changes in legislation
• (1.5.2) what are financial motives for entrepreneurs

  Profit maximisation - more money a business makes more money the entrepreneur will be able to take as a salary.

  Profit Satisficing - means making enough profit, so they can have an enjoyable lifestyle, is shareholders only make enough to keep them satisfied.
• what are non financial motives for entrepreneurs

  -Crave the independence of running their own business.

  -Flexibility of being own boss.

  -Enjoy the challenge of building a business.

  -May be motivated by ethical issues.
• What doe businesses do in first year (objectives 1.5.3)

  May just have survival as the objective, while it build a customer base establish itself in the market to reach us. Sustainable sales must reach breakeven point.
• What is prophet maximisation and why may they do this?

  -Once survived, the early years will seek to maximise profits.

  -Every decision is to make it ensures retain profit is in the business to make future investments, provides a measure of efficiency for managers.