Chap 7. Management activities

• Management activities 


  •planning

  •organising

  •control
• Planning: means that objectives and the method of their achievements are set down. Plans may be short, medium or long term.
• SMART: specific measurable agreed realistic timing
• SWOT: management technique used to assess a business. Strengths and weaknesses are internal, opportunities and threats are external.
• Types of planning

  1. Mission statement- overall purpose and core values.
  2. Strategic plan- long term and guide, senior management.
  3. Tactical plan- short, break down of strategic.
  4. Contingency plan- back up for emergencies.
• Organising: arranging the workforce in the most effective way to achieve the objectives of the business.
• Business structure: how an organisation is organised into departments with different functions such as finance, marketing etc.
• Structures

  1. Functional- different jobs.
  2. Matrix-staff together to achieve goal
  3. Product-split departments
  4. Geographic-different sections/areas
• Span of control: number of people who report directly to one manager in a hierarchy. May be wide or narrow. The more people under control, the wider the span of control. The size of the span depends on the difficulty of work, quality of manager and staff and the type of product.
• Chain of command: the line/path on which orders and decisions are passed down from top to bottom and feedback is passed back up. It improves coordination and motivation. Someone is responsible for each section.
• Types of control

  1. Financial
  2. Quality
  3. Credit
  4. Stock
• Financial control

  1. Cash flow forecast- enough cash.
  2. Budgetary control- sets budget.
  3. Ratio analysis of accounts- financial performance.
  4. Cost control-all cost as planned.
• Quality control

  1. ISO 9000- international award for highest quality.
  2. Q mark- excellence ireland Quality association, stepping stone for ISO.
  3. Quality circles- employees volunteer for Quality problems.
• Credit control: selling goods now but not getting paid until later. It aims to minimise the risk of bad debts from customers who buy goods on credit.
• Credit control

  1. Credit control- person managing credit, CCR national database.
  2. Invoices- inform customers of money owed.
  3. Credit limit- max credit to give to customers.
• Stock control: business has exactly the right amount of stock at all times.
• Stock control


  •max stock level-no more amount of stock.

  •min stock level-no less.

  •re-order point- stock low, new order.

  •re-order quantity- correct stock to buy.
• Just in time (JIT): aim to keep the minimum amount of stock possible while at the same time never running out of stock. Involve buying from a supplier who delivers exactly the right amount.
• CCR


  Central Credit Registration