2.

2 – Organisation and Management

How to Answer a Paper 2 Question
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question

1 – Definition
LO2: Be able to prepare a2effective
– Application
Splash Screen3 and
– Analysis
Navigation Screen4 - Evaluation
In relation to XXXX, the YYYY (DEFINITION) is relevant (APPLICATION) to the
business by…
This means that … (ANALYSIS)
Therefor …. (BALANCE FOR ANALYSIS)
However …. (BALANCE FOR ANALYSIS)
Based on the evidence provided in the Case Study, I would agree/disagree about
XXXX because …. (Evaluation)
Example:
Q1 – Haltec, a computer company has decided to market the release of a new brand of
gaming mouse. In your opinion, how could they use Product as their unique selling
point.
A1 – In relation to the Product, marketing that is aimed at emphasizing the quality of the
product as the best thing about it, this means that Haltec would show the quality in
advertisements like magazine adverts. Therefor the audience would be made aware of
the good points like size, speed, ability. However this may conflict with its price or the
place where they advertise.
Based on the evidence provided in the case study, I would agree that if the product is of
good quality then using Product as the USP would benefit the company more than the
other P’s in marketing as this is what the customers will look for in computer equipment.
Assessment objectives
Assignment Checklist QO1 QO2 QO3 QO4 Q05 QO6
 The
The four
four assessment
assessment objectives
objectives in
in Cambridge
Cambridge IGCSE
IGCSE Business
Business Studies
Studies are:
are:
 AO1: Knowledge and understanding
AO1: Knowledge and understanding
 AO2:
AO2: Application
Application
 AO3: Analysis
AO3: Analysis
AO4:
AO4: Evaluation

Evaluation
 AO1:
AO1: Knowledge
Knowledge and
and understanding
understanding Candidates
Candidates should
should be
be able
able to:
to:
◦◦ demonstrate
demonstrate knowledge
knowledge and
and understanding
understanding ofof facts,
facts, terms,
terms, concepts,
concepts, conventions,
conventions, theories
theories and
and
techniques commonly applied to or used as part of business behaviour.
techniques commonly applied to or used as part of business behaviour.
 AO2:
AO2: Application
Application Candidates
Candidates should
should be
be able
able to:
to:
◦◦ apply
apply their
their knowledge
knowledge and
and understanding
understanding ofof facts,
facts, terms,
terms, concepts,
concepts, conventions,
conventions, theories
theories and
and
techniques.
techniques.
 AO3:
AO3: Analysis
Analysis Candidates
Candidates should
should be
be able
able to:
to:
◦◦distinguish
distinguish between
between evidence
evidence and
and opinion
opinion in
in aa business
business context
context
◦◦order,
order, analyse
analyse and
and interpret
interpret information
information in
in narrative,
narrative, numerical
numerical and
and graphical
graphical forms,
forms, using
using appropriate
appropriate
techniques.
techniques.
 AO4:
AO4: Evaluation
Evaluation Candidates
Candidates should
should be be able
able to:
to:
◦◦ present
present reasoned
reasoned explanations,
explanations, develop
develop arguments,
arguments, understand
understand implications
implications and
and draw
draw inferences
inferences
◦◦ make
make judgements,
judgements, recommendations
recommendations and
and decisions.
decisions.
Assessment objectives
Assignment Checklist QO1 QO2 QO3 QO4 Q05 QO6

 Relationship between assessment

 objectives and
components The approximate weightings allocated
to each of the assessment objectives are
summarised below.
Assessment Objective Paper 1 Paper 2 Weighting for
qualification
AO1: Knowledge and 40% 20% 30%
understanding
AO2: Application 30% 30% 30%
AO3: Analysis 12% 25% 20%
AO4: Evaluation 15% 25% 20%
Grade Descriptors – A Grade
Assignment Checklist QO1 QO2 QO3 QO4 Q05 QO6
 Grade
Grade descriptions
descriptions are
are provided
provided toto give
give aa general
general indication
indication of
of the
the standards
standards of
of achievement
achievement likelylikely to
to
have been shown by candidates awarded particular grades. The grade awarded will
have been shown by candidates awarded particular grades. The grade awarded will depend in practicedepend in practice
upon
upon the
the extent
extent to
to which
which the
the candidate
candidate has
has met
met the
the assessment
assessment objectives
objectives overall
overall and
and itit might
might conceal
conceal
weakness
weakness inin one
one aspect
aspect of
of the
the examination
examination which
which isis balanced
balanced byby above
above average
average performance
performance in in another.
another.
 A
A Grade
Grade -- A
A candidate
candidate should
should demonstrate
demonstrate the the following:
following:
 Knowledge
Knowledge and and understanding
understanding
◦◦ an
an excellent
excellent ability
ability to
to identify
identify detailed
detailed facts,
facts, conventions
conventions and
and techniques
techniques in
in relation
relation to
to the
the content
content of
of
the
the syllabus
syllabus
◦◦ an
an excellent
excellent ability
ability to
to define
define the
the concepts
concepts and
and ideas
ideas of
of the
the syllabus.
syllabus.
 Application
Application
◦◦ aa thorough
thorough ability
ability to
to apply
apply knowledge
knowledge and
and understanding,
understanding, using
using terms,
terms, concepts,
concepts, theories
theories and
and
methods effectively to address business problems
methods effectively to address business problems and issuesand issues
◦◦ aa thorough
thorough ability
ability to
to form
form conclusions
conclusions from
from this
this information
information and
and to
to demonstrate
demonstrate these
these conclusions
conclusions
clearly
clearly and
and logically.
logically.
 Analysis
Analysis
◦◦ an
an excellent
excellent ability
ability to
to classify
classify and
and comment
comment on
on information
information presented
presented in
in various
various forms
forms
◦◦ an
an excellent
excellent ability
ability to
to distinguish
distinguish between
between evidence
evidence and
and opinion.
opinion.
 Evaluation
Evaluation
◦◦ an
an excellent
excellent ability
ability to
to make
make clear,
clear, reasoned
reasoned judgements
judgements and
and communicate
communicate them
them in
in an
an accurate
accurate and
and
logical
logical manner.
manner.
Grade Descriptors – C Grade
Assignment Checklist QO1 QO2 QO3 QO4 Q05 QO6
 A
A Grade
Grade C
C candidate
candidate should
should demonstrate
demonstrate the
the following:
following:
 Knowledge
Knowledge and
and understanding
understanding
◦◦ aa sound
sound ability
ability to
to identify
identify detailed
detailed facts,
facts, conventions
conventions and
and techniques
techniques in
in
relation
relation to
to the
the content
content ofof the
the syllabus
syllabus
◦◦ aa sound
sound ability
ability to
to define
define the
the concepts
concepts and
and ideas
ideas of
of the
the syllabus.
syllabus.
 Application
Application
◦◦ aa sound
sound ability
ability to
to apply
apply knowledge
knowledge and
and understanding,
understanding, using
using terms,
terms,
concepts,
concepts, theories
theories and
and methods
methods appropriately
appropriately to
to address
address problems
problems andand
issues
issues
◦◦ aa sound
sound ability
ability to
to draw
draw conclusions,
conclusions, and
and to
to present
present these
these in
in aa clear
clear manner.
manner.
 Analysis
Analysis
◦◦ aa sound
sound ability
ability to
to use
use and
and comment
comment on
on information
information presented
presented in
in various
various
forms
forms
◦◦ aa sound
sound ability
ability to
to distinguish
distinguish between
between evidence
evidence and
and opinion.
opinion.
 Evaluation
Evaluation
◦◦ aa sound
sound ability
ability to
to evaluate
evaluate and
and make
make reasoned
reasoned judgements.
judgements.
Grade Descriptors – F Grade
Assignment Checklist QO1 QO2 QO3 QO4 Q05 QO6
 A
A Grade
Grade FF candidate
candidate should
should demonstrate
demonstrate thethe following:
following: Knowledge
Knowledge and
and
understanding
understanding
◦◦ aa limited
limited ability
ability to
to identify
identify specific
specific facts,
facts, conventions
conventions oror techniques
techniques in
in
relation
relation to
to the
the content
content of
of the
the syllabus
syllabus
◦◦ aa limited
limited familiarity
familiarity with
with definitions
definitions of
of the
the central
central concepts
concepts and
and ideas
ideas of
of the
the
syllabus.
syllabus.
 Application
Application
◦◦ aa limited
limited ability
ability to
to apply
apply knowledge
knowledge and
and understanding,
understanding, using
using terms,
terms,
concepts,
concepts, theories
theories and
and methods
methods appropriately
appropriately to
to address
address problems
problems and
and
issues.
issues.
 Analysis
Analysis
◦◦ aa limited
limited ability
ability to
to classify
classify and
and present
present data
data in
in aa simple
simple way
way and
and aa limited
limited
ability
ability to
to select
select relevant
relevant information
information from
from aa set
set ofof data
data
◦◦ aa limited
limited ability
ability to
to distinguish
distinguish between
between evidence
evidence andand opinion.
opinion.
 Evaluation
Evaluation
◦◦ aa limited
limited ability
ability to
to understand
understand implications
implications and
and make
make recommendations.
recommendations.
2.1 – Assessment Objectives
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question

2.2 –
LO2: able to prepare aand
BeOrganisation effective Splash Screen and Navigation Screen
Management
Outlines below are the objectives for this section of the Unit. They should be
revised as part of the exam preparation.
2.2.1 - Draw, interpret and understand simple organisational charts:
• Simple hierarchical structures: span of control, hierarchy, Who answers to who
chain of command and delegation in your school
• Roles, responsibilities and inter-relationships between For every Steve
people in organisations Jobs there is 100
2.2.2 - The role of management: Adam Smiths
• Functions of management – planning, organising, co- What kind of leader
ordinating, commanding and controlling of people would you
• Importance of delegation; trust versus control be.
2.2.3 - Leadership styles: Does money equate
• Features of the main leadership styles – autocratic, to position.
democratic and laissez-faire Where on the ladder
• Recommend and justify an appropriate leadership style in are your parents.
given circumstances Who pays for a trade
2.2.4 - Trade unions: union and do you
have to be a
• What a trade union is and the benefits of workers being
member.
union members
2.1 – Glossary
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question

Organisational Structure
LO2: Be able to prepare – The levels
a effective of management
Splash Screen and and divisionScreen
Navigation of responsibilities within an
organisation.
Chain of Command – The structure in an organisation which allows instructions to be passed
down from senior management to lower levels of management.
Line Managers – They have direct responsibility over people below them in the hierarchy of a
business.
Staff Managers - Specialists who provide support, information and assistance to line
managers.
Delegation – Giving a subordinate the authority to perform particular tasks.
Leadership Styles – The different approaches to dealing with people when in a position of
authority – autocratic, laissez-faire or democratic.
Autocratic Leadership - Where the manager expects to be in charge of the business and to
have their orders followed.
Democratic Leadership - Gets employees involved in the decision-making process.
Laissez-faire – Makes the broad objectives of the business known to employees, but then they
are left to make their own decisions and organize their own work.
Trade Union – A group of workers who have joined together to ensure their interests are
protected.
Closed Shop – All employees must be a member of the same trade union.
2.2.1 – What is Organisational Structure?
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 77
77

LO2:Organisational Structure
Be able to prepare refersSplash
a effective to the Screen
level of management and
and Navigation Screen
division of responsibilities within a company. This structure is often How many levels
are there between
presented in the form of a chart. the Principal and
Case Study Example the Cleaners
 Rehab Food Stores is owned and managed by Ahmed Rehab. It is a Where on the
sole trader business. Ahmed has no employees and works a long organisation
day, 12 hours usually. As he works alone in the business he has to do ladder are your
parents
all the jobs which are involved in running a busy convenience store.
Does higher on
Here is a list of just 6 of his tasks:
the ladder always
• Ordering new stock mean more pay
• Serving customers What happens
• Going to the bank to pay in cash – he does this on Thursday when people
afternoons when the shop is closed. move down the
• Arranging shelf displays ladder
• Keeping all the paperwork up t date, such as making sure Is the job easier or
more rewarding
suppliers are paid on time
higher up
• Contacting the local newspaper to arrange an advert for the shop.
How high do you
Activity 7.1 aspire to be on
 Read the case study above and list three other tasks that you think the ladder
Ahmed has to do in order to run the Rehab Food Stores efficiently.
2.2.1 – Why does organisational structure change as a business expands?

Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 78
78

 InBeAhmed’s
LO2: businessa there
able to prepare is noSplash
effective need for an organisational
Screen structure
and Navigation Screenbecause he works
alone. There is no need to lay out the responsibilities and duties of other employees or to
indicate their links with other workers – because there aren’t any! As he is the only
manager, there can be no other management levels. This example shows the simplest
form of business. What would happen to the organisation of Ahmed’s business if it
expanded?

?
Case Study Example
 Ahmed was exhausted. At the end of another long day Ahmed decided that he could no
longer do all the work of running the store by himself. He was going to advertise for a shop
assistant. He thought carefully about what work he would want to assistant to perform.
 Ahmed remembered from his previous job, working for a large retail chain, that it was
important to make clear the tasks and responsibilities of employees. If this was not done
then two people might end up doing the same work – and some work might not get done
at all.
 He decided to write out a job description (see next slide) which he would give to all the
people who applied for the job. This would make clear what the job would involve. Ahmed
thought this would have 2 main advantages:
• People applying for the job could see if they were suitable for the work expected of
them
• Once in the job, the new employee would know exactly what their duties and
responsibilities were. Their work should therefor help Ahmed, not just repeat what he
was doing.
2.2.1 – Why does organisational structure change as a business expands?

Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 78
78

Job Description
LO2: Be able to prepare a effective Splash Screen and Navigation Screen
• Shop Assistant
Main Tasks
• To open the shop in the morning
• To be responsible for ordering all goods from suppliers
• To arrange all shelf displays
• To help serve customers
• To assist the manager in other ways directed by him
Working conditions
• Five days a week
• Eight hours a day
• Four weeks’ holiday – by negotiation, but not at the same time as the manager.
Activity 7.2 - Read the case study above.
a) Study the job description. Do you think Ahmed is looking to recruit an experienced
shop assistant? What evidence is there to support your answer? ?
b) Make a list of the important tasks and responsibilities Ahmed still has to perform
himself.
 Ahmed’s business now has a very simple organisational structure. There are now two
people in the organisation and they are specializing in different jobs.
2.2.1 – Organisation Charts – Case Study Example
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 79
79

Case Be
Study
ableExample
?
LO2: to prepare a effective Splash Screen and Navigation Screen
 Ahmed’s business has expanded rapidly. More employees have been appointed. Some of
them managed the shop because Ahmed spent more time on office work. Shop opening
hours were lengthened, Eventually, Ahmed decided to open 4 further stores in other
towns. It became clear to Ahmed that his business needed the advantages of limited
company status (unit 01).
 A business friend agreed to buy shares and become one of the directors of the company.
As the organisation was growing, Ahmed decided it needed a clear structure. After
discussions with his directors and senior managers, he drew out the chart below.

Chief
Chief Executive
Executive -- Ahmed
Ahmed Jamail
Jamail

Sales
Sales Manager
Manager Financial
Financial Director
Director Human
Human Resources
Resources
Director
Director
Store
Store Managers
Managers Purchasing
Purchasing Manager
Manager Book-Keeper
Book-Keeper
Administrative
Administrative
Assistant
Assistant
Assistant
Assistant Store
Store Managers
Managers

Shop
Shop Workers
Workers
2.2.1 – Why does organisational structure change as a business expands?

Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 79
79

 InBefact,
LO2: this
able to is a typical
prepare organisational
a effective chart
Splash Screen and for many businesses.
Navigation Screen The most
important features are as follows:
• It is a hierarchy. This means that there are different levels in the
organisation. Each level has a different degree of authority. People on the
same level of hierarchy have the same degree of authority. There are 5
levels of hierarchy from Chief Executive to Shop Worker.
• It is organized into departments, each of which has a particular job or
function.
• As there are different levels of management, there is a chain of
command. This is how power and authority are passed down from the top
to the lower levels in the organisation. Because Rehab Food Stores is still
quite a small business, the chain of command is quite short as there are
not many levels of management. Bigger businesses are likely to have more
levels of hierarchy and therefor a longer chain of command.
 Ahmed decided to give a copy of this chart to all members of staff. He
considered that there were several advantages in both constructing the
organisation chart as a hierarchy and informing everybody of it.
2.2.1 – Advantages of an organisational chart
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 79
79

 The
LO2: chart
Be able shows ahow
to prepare everybody
effective is
Splash Screen and Navigation Screen
linked together within the organisation.
All employees are aware of which
communication channel is used to
reach them with messages and
instructions.
 Each individual can see their own
position within the organisation. They
can identify who they are accountable
to and who they have authority over.
Employees can see who they should
take orders from.
 It shows the links and relationships
between different departments within
the organisation.
 Everyone is in a department and this
gives them a sense of belonging.
2.2.1 – Chain of Command and Span of Control
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 80
80

 Look
LO2: attothe
Be able two organisational
prepare charts
a effective Splash onand
Screen theNavigation
right. Screen Business A
There are two essential differences between them.
• Business A has a tall structure and a long chain
of command
• Business B has a wide structure and a short
chain of command. Business B
 As a result of these two different structures, the
span of control (the number of subordinates
working directly under a manager) is wider in
Business B (five) than in Business A (two).
 There is therefor an important link between the
span of control and the chain of command. The
longer the chain of command, the ‘taller’ will be
the organisational structure and the ‘narrower’ the
span of control.
 When the chain of command is short, the
organisation will have ‘wider’ spans of control.
2.2.1 – Chain of Command and Span of Control
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 80
80

 There
LO2: is no
Be able perfect organisational
to prepare structure.
a effective Splash In recent
Screen and years many Screen
Navigation Business A
organisations have made their structures ‘wider’ and with a
shorter chain of command. In some cases this has been done by
removing a whole level of management – called de-layering. The
claimed advantages of short chains of command are listed below:
Advantages of short chains of command: Business B
 Communication is quicker and more accurate. Each message has
fewer levels to pass through before reaching the intended
destination.
 Top managers are less remote from the lower level of the
hierarchy. These top managers should be more in touch with
people below them as there are fewer management levels to get
to know.
 Spans of control will be wider. This means that each manager is
responsible for more subordinates. Why is this an advantage?
• If superiors have more people to manage, it will encourage
managers to delegate more. Why? As their department is larger,
they cannot possibly do all the important work by themselves.
• There will be less direct control of each worker and they will feel
more trusted, take more decisions by themselves and obtain
more job satisfaction.
2.2.1 – Chain of Command – Case Study
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 81
81

Case Study
LO2: Be ableExample
to prepare a effective Splash Screen and Navigation Screen
 Mustafa was bored with his work as a telephone operator in a large telephone banking firm. The
business received calls from customers who wanted to use banking services but did not have
time to go to a bank branch.
 Mustafa worked in a team, called team A, with other colleagues, Hassan and Amel. They were ?
supervised by Asser, who was under the authority of Mohammed. There were two other groups
of telephone operators, team B and Team C. These two teams were the same size as team A.
They also had their own supervisors who reported to Mohammed.
 All calls were recorded and supervisors could listen in to make sure all workers were polite and
helpful to customers. Telephone operators were only allowed to do certain tasks for customers.
Other jobs, such as transfers of large sums of money, had to be referred to a supervisor or
manager. Telephone operators had to aim to answer 20 calls per
hour. No wonder Mustafa was bored with his work!
Activity 7.3
 Read the case study above
a) Draw the organisational chart for this telephone business.
b) What is the span of control for the supervisors?
c) What would be the advantages and disadvantages of removing the
supervisors altogether? Your answer should include references to:
• Chain of command
• Delegation
• San of control
2.2.1 – Roles, responsibilities and inter-relationships between
people in organisations.
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 81
81

CaseBeStudy
LO2: prepare a effective Splash Screen and Navigation Screen
able to Example
 The newly opened branches of Rehab Stores PLC proved to be just as
popular as the first one. Profit increased and the business expanded in
other ways. Ahmed and his fellow directors decided to open the first
?
store abroad, the UK. They had plans to open several more.
 The directors have also taken the step of opening a food processing
factory to provide some of the goods sold by the Rehab Stores/ It was
found to be cheaper to produce these goods than to buy them from
outside suppliers.
 These expansion projects had required a great deal of capital. The
business had ‘gone public’ several months ago. The sale of shares to the
public raised the necessary finance. Ahmed was chairman of the
company as well as chief executive. He and his board of directors were
accountable to the shareholders. The management structure below him
was now more complicated than when the business was smaller. The
current organisation chart is shown below.
2.2.1 – Roles, responsibilities and inter-relationships between
people in organisations.
Grading
Grading Glossary
Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question Page
Page 82
82

LO2: Be able to prepare a effective

ChiefSplash
Chief Screen
Executive
Executive and Navigation
-- Ahmed
Ahmed Jamail
Jamail Screen
?
IT
IT Manager
Manager Economic
Economic Forecasting
Forecasting Manager
Manager

Operations
Operations Financial
Financial Purchasing
Purchasing Marketing
Marketing Director
Director of
of Human
Human Resources
Resources
Director
Director Director
Director Director
Director Director
Director UK
UK Division
Division Director
Director

Food Financial Specialist

Specialist Sales
Sales Administrative
Administrative
Food Financial
Processing Accountant Product
Product Manager
Manager Officer
Officer
Processing Accountant
Factory
Factory Buyers
Buyers
Managers
Managers Store
Store
Book
Book Managers
Managers
Keeper
Keeper
Factory
Factory Assistant
Assistant
Workers
Workers Store
Store
Managers
Managers

Shop
Shop Workers
Workers
2.2.1 – Roles, responsibilities and inter-relationships between
people in organisations.
Grading
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2.2.3 2.2.4
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?
LO2:The keytofeatures
Be able prepare of the current
a effective organisational
Splash chart, which
Screen and Navigation is typical of many
Screen
larger businesses, are as follows:
• It is still largely arranged into functional departments, such as Finance and
Marketing. These departments are responsible for one important part of the
work of the organisation. They use specialist skills in their work and are often
efficient as a result. However, businesses organized in this way may find that
workers feel more loyalty to their department than to the organisation as a
whole, There could be conflict between departments, e.g. Operations may
wish to purchase new machinery, but Finance do not make the necessary
money available. Managers working in these departments are called line
managers. They have the authority to give orders and to have their decisions
put into effect in their department. They directly supervise subordinates in a
clear line of authority.
• In addition to these functional departments, there is also a regional division
responsible for the Rehab stores in other countries. This department has the
advantage of being able to use specialist knowledge to help them run the store
abroad. For instance, this department will be aware of which goods are likely
to be most popular in each country or which goods may be illegal in some.
2.2.1 – Roles, responsibilities and inter-relationships between
people in organisations.
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2.2.3 2.2.4
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•LO2:There to prepare
Be ableare a effective Splash
other departments Screen
which andhave
do not Navigation Screen
a specific function and which
employ specialists in particular areas. Examples from Rehab Stores are the
Economic Forecasting department and the IT department. Some people
include the Human Resources department in this group too. These ?
departments report directly to the Board of Directors. (Meetings of the Board
of Directors will be attended by the department directors and the Chief
Executive.) The people in these departments are called staff managers
because they provide specialist advice and support to the Board of Directors
and to line managers of the functional departments. Staff managers tend to be
very well-qualified experts. They often know more about their particular
specialist subject that they do about running the business.
Activity 7.4 – Using the case study above:
a) What are the advantages and disadvantages of this tall organisation
structure for Rehab Stores PLC?
b) Give three examples of conflicts which may arise from this structure.
c) Do you think this organisational structure increases motivation for its
employees?
d) What are the benefits of having a regional division for the business?
2.2.2 – The Role of Management - Planning
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LO2:All
Bebusinesses andaorganisations
able to prepare have
effective Splash managers.
Screen They mayScreen
and Navigation not be called managers
because different titles can be used – leader, directors, head teacher etc. Whatever
their title, the tasks of all managers are very similar, no matter the organisation. If
you are a student in a school or if you are in full employment, the managers of your
organisation will, at some time, have to fulfill the following functions.
Planning
 Planning for the future of the organisation involves setting aims or targets, e.g.: ‘the
school will aim to increase its 6th form to over 200 students in two years’ time’ or
‘we should plan to increase sales of our new fruit juice range by 50% in the next 3
years’.
 These aims or targets will give the organisation a sense of direction or purpose.
There will be a common feeling in the organisation of having something to work
towards. It is a poor manager who does not plan for the future at all.
 In addition to these aims, a manager must also plan for the resources which will be
needed, e.g.: ‘to achieve our aim of increasing student numbers in the 6th form , we
will need to build a new 6th form centre’ or ‘increased advertising expenditure will
be needed to increase sales of our fruit juices’. These are two examples of
strategies which are designed to help the organisation achieve the aims set for it.
2.2.2 – The Role of Management – Organising and Coordinating
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Organising
LO2: Be able to prepare a effective Splash Screen and Navigation Screen
 A manager cannot do everything. Tasks must be delegated to others in the organisation.
These people must have the resources to be able to do these tasks successfully, . It is
therefor the manager’s responsibility to organize people and resources effectively.
 An organisational chart can help to show who has the authority to do different jobs. It also
helps to make sure that specialisation occurs and two people do not end up doing the
same task. An effective manager will organize people and resources very carefully.
Coordinating
 This means ‘bringing together’. A manager may be very good at planning and organizing
but may have failed to ‘bring people in the organisation together’. There is a real danger
with the functional form of organisation. Different departments can be working away in
their own specialist area without making contact with people from other departments,
e.g. there is no point in the Marketing Department planning the launch of a new product
unless they have coordinated with the Operation Department, It is the Operations
Department that will have to produce the product at the right time in the right quantities.
 A good manager will therefor make sure that all departments within the organisation work
together to achieve the plans originally set by the manager. This example could be done
with regular meetings between people in the different departments. Alternatively, a
project team could have been set up to develop and launch the new product, made up of
people from the involved departments.
2.2.2 – The Role of Management - Commanding
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Commanding
LO2: Be able to prepare a effective Splash Screen and Navigation Screen
 Many people think that this is all that
managers do! In fact, the task of
management is more concerned with
guiding, leading and supervising
people than just telling them what to
do – although this is important too.
Managers have to make sure that all
supervisors are keeping to targets and
deadlines. Instructions and guidance
must be provided by managers and it
is also their responsibility to make
sure that the tasks are carried out by
people below them in the
organisation.
2.2.2 – The Role of Management - Controlling
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Controlling
LO2: Be able to prepare a effective Splash Screen and Navigation Screen
 This is a never-ending task of management. Managers must try to measure and evaluate
the work of all individuals and groups to make sure they are on target, There is little point
in planning and organizing if managers then fail to check that the original aims are being
met. If it seems that certain groups fail to do what is expected of them, then managers
may have to take some coercive action. This is not necessarily disciplining staff 0 although
that might be important. There might be other reasons for poor performance other than
inefficient workers 0 it is the manager’s job to find out what targets are not being met and
then to correct the problem.
 Management is not easy to define, but the list of tasks above helps to demonstrate the
varied and important work that good managers should be doing.
 From studying the list of points on slides 22-25, it should also become clear why
management is important to an organisation. Without clear and effective management, a
business is going to lack:
• A sense of control and direction
• Coordination between departments, leading to wastage of effort.
• Control of employees
• Organisation of resources, leading to low output and sales.
• In short, without management to take the business forward, the firm will drift and
eventually fail.
2.2.2 – The Role of Management
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Activity
LO2: Be 7.5
able to prepare a effective Splash Screen and Navigation Screen
 Nashaq is a student at a 6th Form College> He recently took part in a work shadowing exercise to find
out what it is like to be a manager. Work shadowing means that a student follows a manager for a day
or more to experience the work that they do.
 Nashaq ‘shadowed’ Seif Hani, who is the manager of the sportswear section in Festival Mall plc,
a large department store. Nashaq kept the following diary for 1 day.
?
Time Task Skill
08 30 Attended meeting with other departmental heads and Chief Executive to agree targets for the next
two years. Departmental heads told to plan their own strategy to meet these goals
09 15 Two staff members failed to turn up for work. Seif asked other staff to cover these absences by
working longer shifts today.
10 00 Meeting with Sales Manager from big sports manufacturer. Seif discussed the range of goods he
may purchase next year to meet the store’s targets.
11 00 New member of staff did not cope well with an awkward customer. When customer had gone, Seif
reminded the shop assistant of the correct procedure that should be followed. Asked worker always
to follow company policy in these matters.
14 30 Computer printouts of individual staff sales figures were studied. One worker in particular had failed
to meet sales targets and it was agreed with him that further product training was necessary.
16 00 Email received from Seif’s line manager. There was a problem with another department selling
clothing including sports clothes. It was no possible for customers to find the same foods in the store
in two departments at different prices! Seif needed to meet with the other departmental manager to
agree on a common policy.
 For each of these tasks that Seif carried out, identify whether it was concerned with: planning,
organizing, coordinating, commanding or controlling and state why you think this is.
2.2.2 – The Role of Management - Delegation
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Delegation
LO2: Be able to prepare a effective Splash Screen and Navigation Screen
 Even though Ahmed’s business is still very small, it is possible to see a very important idea
is already being used. This idea is called delegation. This means giving a subordinate the
authority to perform particular tasks. It is very important to remember that it is the
authority to perform a task which is being delegated not the final responsibility. If the job
is done badly by the subordinate then it is the manager who has to accept the
responsibility for this.
 Advantages of delegation for the manager
• Managers cannot do every job themselves. As we have seen, it was becoming very
difficult for Ahmed to control all the running of Rehab Stores by himself.
• Managers are less likely to make mistakes if some of the tasks are being performed by
their subordinates.
• Managers can measure the success of their staff more easily. They can see how well
they have done in performing the tasks delegated to them.
 Advantages of delegation for the subordinate
• The work becomes more interesting and rewarding
• The employee feels more important and believes that trust is being put in them to
perform a job well.
• Delegation helps to train workers and they can then make progress in the organisation,
giving them career opportunities.
2.2.2 – The Role of Management - Delegation
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Why a Manager
LO2: Be might not
able to prepare delegate?
a effective Splash Screen and Navigation Screen
 Despite the advantages of delegation, there are some managers who are reluctant to
delegate. Some may be afraid that the subordinates might fail and the manager wants to
control everything by themselves. Also, there is a risk that the subordinates might do a
better job than the manager! This could make the manager fell very insecure.
a reduction in direct control by
supervisors and managers Increasing trust of workers by
once tasks are done by Delegation must mean: supervisors and managers
workers

There needs to be an increase in trust in order to reduce control over workers

Revision Summary – Delegation
Gives authority to others to take Staff development
Makes work more decisions and perform tasks increases job satisfaction
interesting

USERS OF BUSINESS
ACCOUNTS

Subordinate feels Some managers are Manager loses some Allows managers to give
trusted reluctant to delegate control over subordinates time to other issues
2.2.2 – The Role of Management - Delegation
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LO2:Different
Be able tostyles of leadership
prepare a effectiveoften callScreen
Splash for different management
and Navigation styles. The way in which
Screen
a manager deals with a situation can have a very important impact on people and how
they react to the manager. It is important to remember here that a good manager will
adopt the style if leadership that best suits each situation.
Revision Summary – Effective Managers
Plan for the Organise and Coordinate Command and Control and assess the
future delegate Departments guide others work of departments

Tasks

EFFECTIVE MANAGERS

Qualities

Good
Determination Intuitive Communication
Intelligence Self-confidence Intuitive
Skills
2.2.3 – Leadership
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2.2.3 2.2.4
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Why is itable
LO2: Be important to have
to prepare good managers?
a effective Splash Screen and Navigation Screen
• To motivate employees
• To give guidance and advice to employees they manage
• To inspire employees they manage to achieve more than they thought
possible.
• To keep costs under control
• To increase profitability of the business
Leadership
 Studies on motivation have emphasized the importance of good
management in business and the need for leadership, There are many
leaders in society – from politicians, religious leaders, captains of sports
teams, to leaders of large business. Many people take on the role of being
a leader and some are more effective than others. A good leader in a large
business is someone who can inspire and get the best out of the
workforce, getting them to work towards a common goal.
Styles of Leadership
 There are different approaches to leadership that are adopted and these
can be summarized into three main leadership styles.
• Autocratic leadership
• Democratic leadership
• Laissez-faire leadership
2.2.3 – Leadership – Autocratic and Democratic
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Autocratic
LO2: prepare a effective Splash Screen and Navigation Screen
Be able toLeadership
 This is where the manager expects to be in charge of the
business and have their orders followed, keeping
themselves separate from their employees. They make
virtually all the decisions and keep information to
themselves. They tell employees only what they need to
know. Communication in the business is mainly one way,
that is downward or top-down, and the workers have
little or no opportunity to comment on anything.
Democratic Leadership
 This leader will get other employees involved in the
decision-making process. Information about future plans
will be openly discussed before the final decision will be
made, often by the leader. Communication will be both
downward or top-down and upward or bottom-up.
2.2.3 – Leadership – Laissez-faire
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Laissez-Faire Leadership
LO2: Be able to prepare a effective Splash Screen and Navigation Screen
 This is French for ‘Leave to do’ and tends to make the broad objectives of the
business known to employees, but then they are left to make their own
decisions and organize their own work. Communication can be difficult in this
type of organisation as clear direction will not be given. The leader has only a
very limited role to play.
 The style of leadership used by a manager can vary depending on the
employees being dealt with and the problem to be solved. Managers may not
be autocratic leaders all the time – it may be appropriate for them to be
democratic over some issues, whereas other issues will need a decision
imposing on the workforce.
2.2.3 – Leadership Styles
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2.2.3 2.2.4
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Activity
LO2: 7.6
Be able to prepare a effective Splash Screen and Navigation Screen
How many levels
 When Rehab Food Stores started it was small and are there between
the Principal and
Ahmed, the sole owner, knew all the employees by the Cleaners
name. He used a management style which involved Where on the
asking the workers what they thought about his organisation
ladder are your
decisions and encouraged them to tell him their ideas parents
about the business. The business has now grown in a Does higher on
the ladder always
large public limited company with many more mean more pay
employees. What happens
 Look back at the case study on slides 17-21 (page 81- when people
move down the
83) and consider the different leadership styles which ladder
might be suitable for Ahmed or his managers to use. Is the job easier or
 Which do you think will be the best leadership style for more rewarding
higher up
Ahmed and his managers to use? Explain your answer. How high do you
aspire to be on
Tips for success – Make sure you know the leadership styles the ladder
and you can apply them to different work situations.
2.2.4 – Trade Unions
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2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
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LO2:Employees
Be able to prepare a effective
generally share Splash Screen
many of and Navigation
the same interests,Screen
The British Miner
such as improving their pay, having a pleasant Strike in the 1980’s.
environment in which to work, being treated fairly by their Jimmy Hoffa and
employer, being given proper training and working in a the Teamsters
Union.
safe environment. Forming a trade union is a way of
Do Unions exist in
helping employees to achieve improvements in these Communist
different aspects of their employment – a trade union is a countries.
type of pressure group. Terms such as Sit-
Ins, all out, closed
 Today, trade unions are found in many different countries shop, solidarity.
around the world. How much power
Why do workers join a Trade Union does a union have if
all the workers are
 When a person starts work they may be asked by someone not members
who represents a trade union if they want to join. If the Which kind of
worker decides to join the trade union, they will pay an business will not
have a union.
annual subscription (a yearly fee).
When can a union
Tips for success – Make sure you can explain the advantages and not call a strike
disadvantages of trade union membership from both the employees’
and the employers viewpoints.
2.2.4 – Trade Unions
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2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
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LO2:What benefits
Be able do employees
to prepare a effectivereceive
SplashinScreen
exchangeandfor paying their
Navigation subscription? It varies
Screen
from Union to Union, but could include some of these benefits:
• Strength in numbers
• Improved conditions of employment, i.e. rates of pay, holidays and hours of work.
• Improved environment where people work, e.g. health and safety, noise and heating.
• Improved benefits for members who are not working because they are sick, retired or
have been made redundant (retrenchment)
• Improved job satisfaction by encouraging training
• Advice and/or financial support if a member thinks that they have been unfairly
dismissed or made redundant, have received unfair treatment, or have been asked to
do something that is not part of their job
• Benefits have been negotiated or provided for union members such as discounts in
certain shops, provision of sporting facilities or clubs.
• Employment where there is a closed shop.
 However, there are disadvantages to an employee of trade union membership:
• Costs money to be a member
• May be required to take industrial action even if they don’t agree.
 Trade unions also seek to:
• Put forward their views to the media and influence government decisions, for example
the minimum wage legislation and employment laws.
• Improve communications between workers and management.
2.2.4 – Trade Unions – Revision Summary
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2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
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Revision
LO2: prepare a effective
Summary
Be able to Splash Screen
– Benefits and Navigation
of joining a TradeScreen
Union
Representation in Advice if dismissed Improved communications
grievances with (unfairly or made between employees and
management redundant) management

Strength in Improved Pay

numbers
BENEFITS OF JOINING A
Improved working TRADE UNION Advice if
conditions unfairly treated

Services such as Improved conditions

insurance, social facilities of employment
Possible influence on Employment if there
Government decisions is a closed shop
2.2.4 – Activity 7.7 - Trade Unions
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2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
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Activity 7.7 –toTrade

LO2: Be able unions
prepare a effective Splash Screen and Navigation Screen
 Sallah has just started working as an Administrative Assistant in a
government department and has been asked if he wants to join the Trade
Union that represents the workers in that department. He does not know
what to do as he knows nothing about trade unions. Write him a letter
outlining the advantages and disadvantages of joining a trade union.
Include a recommendation to Sallah as to whether to join the union or not.
International Business in Focus
 Chelsea Football Club has just appointed a new manager. The club has not
been winning many games and the owner decided to sack the old manager
and employ a new one. The original manager did not tell the players what
to do, he would ask them for their opinions on the game and which players
the captain thought should play in the next games.
‘I am a professional footballer and I know what I am talking about’, said
one of the players.
 The owner thinks it is time for a new approach to managing and leading
the players.
Discussion Points
• What type of leadership style did the original manager use?
• Why does the owner want a new manager with a new leadership style?
• How might the players react to the new style?
2.2 – Exam Styles Questions – Paper 1
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UnitBe02
LO2: to prepare
- Exam
able a effective
Styles Splash –
Questions Screen
Paperand
1 Navigation Screen
1. Lamis awns a business which produces office furniture. She employs
100 workers in the Operations Department and 15 workers in the
offices. Lamis believes in a democratic leadership style. Lamis says
that being a good manager is very important to the success of the
business. She sees no need for any of her workers to join a Trade
Union.
a) What is meant by a ‘democratic leadership style’? [2]
b) Identify two examples of other leadership styles Lamis could use.
[2]
c) Identify and explain two roles/tasks Lamis undertakes as the
manager. [4] ?
d) Identify and explain two reasons why having a good manager is
important to the business. [6]
e) Do you think Lamis is right to say that her workers do not need to
join a trade union? Justify your answer. [6]
2.2 – Exam Styles Questions – Paper 1
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2.
LO2:The
Be following organisational
able to prepare chartSplash
a effective is for TMG. It is and
Screen a private limited company
Navigation Screen which runs a chain
of supermarkets. The organisational chart shows the hierarchy structure of the business.
Managing
Managing Director
Director

Finance
Finance Director
Director Marketing
Marketing Director
Director Human
Human Resources
Resources Director
Director Operations
Operations Director
Director

33 Departmental
Departmental 44 Departmental
Departmental 33 Departmental
Departmental 10
10 Supermarket
Supermarket
Managers
Managers Managers
Managers Managers
Managers Managers
Managers (1
(1 for
for
each
each supermarket
supermarket
10
10 Assistants
Assistants 20
20 Assistants
Assistants 55 Assistants
Assistants
1000
1000 Assistants
Assistants
a) What is meant by a ‘hierarchical structure of the business’? [2] (100
(100 for
for each
each
b) Identify how many people are in the span of control for: supermarket
supermarket
a) Operations Director, and

?
b) Finance Director. [2]
c) Identify and explain the role of two of the functioning departments listed in the chart. [4]
d) Identify and explain two disadvantages of the business having a tall organisational structure.
[6]
e) Do you think more delegation would be a good idea for this business? Justify your answer.
[6]
Real Exam Questions - Paper 2
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Glossary 2.2.1
2.2.1 2.2.2
2.2.2 2.2.3
2.2.3 2.2.4
2.2.4 Exam
Exam Question
Question

 November
LO2: 2007
Be able to prepare – Exam
a effective Paper
Splash 03 and
Screen – 2.1 Question
Navigation Screen