Business Level 2

Front 1

Organisational Structure

Back 1

The way the jobs, responsibilities and powerwithin a business are organised. The levels of management and division ofresponsibilities within an organisation. This structure is often presented in an organisation chart.

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Delayering

Back 2

Removal of one or more of the levels of hierarchyfrom an organisation

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Centralisation

Back 3

All major decisions are made by oneperson or a few senior managers at the top of the hierarchy. In a centralisedorganisation those at the head of the organisation keep power - this would bethe case where the owner of a business does not wish to lose control, so triesto retain responsibility for everything.

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Decentralisation

Back 4

The authority to make decisions is shared out. For examplepower to make decisions might be delegated to regional managers or to morejunior employees.

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Tall Organisational Structure

Back 5

More levels of hierarchy, smaller span of control, particularly at the higher levels, long chain of command

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Matrix OrganisationalStructure

Back 6

A flexible organisation where project teams havepeople from different departments temporarily working together on a project,led by a team leader or a project manager

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Matrix Organisational Structure

Back 7

A flexible organisation where project teams havepeople from different departments temporarily working together on a project,led by a team leader or a project manager

Front 8

Batch Production

Back 8

Producinga limited number of identical products in one batch for example the Kristinschool uniform

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Flow Production

Back 9

Producingitems in a continually moving process. Different operations are continuouslyand progressively carried out in sequence for example newspaper printing orbeer production

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Productivity

Back 10

The output (production) measured against the inputs(usually labour) used to create it (A measure of e business' efficiency)

Front 11

Lean Production

Back 11

Producing goods and serviceswith the minimum of waste resources while maintaining high quality

Front 12

Economies of Scale

Back 12

Economies of scale are the factors that lead to a reduction in average costs as a business increases in size.

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Capacity

Back 13

Full capacity means the total level of output available when all a business’ machines are being 100% utilised and they cannot produce any more products.

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Variance Analysis

Back 14

Original budget and actual results are comparedand the reasons for the differences are investigated.

Front 15

Autocratic/Authoritarian

Back 15

· Leader makes all the major decisions and tellsothers what to do

·Setsobjectives, allocates tasks, and insists on total obedience

· It is very clear what the management wants. Makesit easy to implement policies throughout the whole business. Everyone knowswhat is expected.

· Good in times of crisis or in certain organisationssuch as the army

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Democratic

Back 16

· Will engage in discussion with workers beforetaking decisions.

· Communication will be two-way and staff will haveopportunity to respond.

· Managers using this style will be goodcommunicators. Full participation in the decision making process is encouraged.

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Paternalistic

Back 17

· Managers do what they think is best for theirworkers. Some consultation but final decision rests with the leader

· When the manager or leader, typically male, isdominant and wants to protect or control his employees

· Not true participation. Managers want their workersto be happy.

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Laissez-faire

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· Managers delegate just about everything

· This style requires mature managers and maturestaff in order to be effective

· It is more suited when employees areself-motivated, creative and capable of working without too much direction, forexample in an advertising agency or social media company.

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Corporate Social Responsibility

Back 19

The obligation of the organisation to act in anethical way which serves both its own interests and that of its stakeholders –employees, the local community, the customers, the suppliers

Front 20

Putake

Back 20

Every businesshas a reason for being. Many Māori businesses exist for the same reason asother businesses – to provide goods or services at a profit, and to enrich thebusiness owner(s). A significant number, however, have very different reasonsfor being – reasons that are associated with collectively owned resources (suchas land, tribal estates) and / or whakapapa-based groupings, such as whānau,hapū, and iwi.

Front 21

Ethical Business Practises

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Ethical business practices are the actions of organisations that areconsidered to be morally correct, such as protection of the environment,avoiding waste, the good treatment of employees and using fair trade practices. E.g. Fair treatment of workers, customers and suppliers. Good pay and working conditions for employees. Opportunities for development and training

Front 22

Trade Union

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Atrade union is an organisation that,through its leadership, bargains with the employer on behalf of union membersand negotiates labour contracts (collective bargaining) with employers. Trade unions seek to improve pay and working conditions for their members, who are employees of the business

Front 23

Collective Bargaining

Back 23

The process of negotiation between the representativesof the employees (usually trade union officials) and management, who representthe employer. They are trying to negotiate a collective agreement

Front 24

Methods used by employees toachieve their objectives - Political Influences

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Go-slows - workers perform their jobs as usual, except that they do so at a slower pace than normal. This reduces productivity, but it is difficult to discipline workers who are still working, and may not admit to deliberately producing less. Go-slows can be very effective when deadlines approach so that production targets need to be met quickly.

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Methods used by employees to achieve their objectives - Political Influences

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Strike action - a strike is a complete withdrawal of labour - a refusal to work. This is a last resort, and usually happens after negotiations have failed and other forms of action have been exhausted. The union members will vote on such action. In certain circumstances, such as the "unfair" dismissal of a worker, the union members may "walk-out" as a sign of protest. This is also known as a "wildcat" strike.

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Methodsused by employers to achieve their objectives - Political Influences

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Publicrelations -the organisation may try to gain public support byhighlighting their point of view in a favourable light in the media. For example, a hospital could publicise howpatients might suffer if the nurses went on strike.

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Methods used by employers to achieve their objectives - Political Influences

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Lock-outs - if someworkers are on strike while others come into work, the employer might decide itis not worth paying some workers, as the business cannot functionnormally. Therefore, the employer might"lock-out" everyone. Thiswould put pressure on the union/striking workers, as the others want tocontinue working.

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Tax

Back 28

Taxation policy affects business costs. Forexample, a rise in business tax (on business profits) is an increase in costs.Businesses can pass some of this tax on to consumers in higher prices, but itwill also affect their bottom line (profit).

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Tax

Back 29

A change inindirect taxes may affect a business. GST technically has a zero effect. TheGST added to sales is paid to the government. GST paid on expenses and thepurchase of assets is collected from the government. However, if a governmentraises GST, the business may not be able to pass all of it on due tocompetitive pressure or the economic environment, if the economy is in arecession. Another indirecttax is the tax paid on petrol. If this is raised a business will have a higherfuel costs which will affect certain industries – for example transport.

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Tarrif

Back 30

A tariff is atax imposed on imported goods and services. If the NZ government removes atariff then it is cheaper for an importer to send their goods to NZ. This couldmean that a local manufacturer faces more competition and will have to lowerits prices to compete, or even move their manufacturing to another country.

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Subsidy

Back 31

A subsidy is aform of financial aid given by a government to a particular type of business. Ifa government grants a subsidy to a particular industry that business in effecthas reduced its costs and can either ‘bank’ increased profit, which makes themmore financially stable. Or they could reduce prices in order to increase salesand increase the size of their customer base

Front 32

Employment Act

Back 32

Is the legal foundation of allrelationships between employees and employers in New Zealand.

· Employers and employees (and the tradeunion if they belong to one) must deal with each other in good faith – openly andhonestly. They must negotiate with the aim of reaching an agreement

· Employers must pay employees, provide safeworkplace, give employees paid leave and provide writtenemployment agreements.

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Privacy Act 1993

Back 33

Protects NewZealanders from invasion of personal privacy by other individuals orbusinesses.

· The Act controls how organisationscollect, use, disclose, store and give access to personal information