Pages in this set

Page 1

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Chapter 16
Using budgets

Benefits of using budgets
They provide direction and contribution you now how much you should be
spending.
Motive staff makes them work harder.
They improve efficiencyby monitoring and reviewing budgets.
The assess forecasting ability predictions

Drawbacks of using budgets
Difficult to monitor fairly.
Allocations may be…

Page 2

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Chapter 17
Improving cash flow

Causes of cashflow problems
Firms may have cash flow problems for a variety of reasons:
Seasonal demand the demand for the products may fall during different reasons
e.g. ice cream does not really sell in winter.
Overtrading the firms become over confident and expand but…

Page 3

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Chapter 18
Measuring and increasing profit

Net profit margin (%) = net profit before tax
Sales (turnover)

Return on capital (%) = net profit before tax
Capital invested

Methods of increasing profits
Increasing price
Decreasing costs
Increasing sales
Investing in assets

Page 4

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Chapter 19
Improving organisational structures

Organisational structure
Organisational structure the relationship between different people and functions
in an organisation.
Organisation charta diagram showing the lines of authority and layers of hierarchy
in an organisation.
Span of control the number of subordinates whom a manager is required to
supervise directly.
Delegation…

Page 5

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Chapter 20
Measuring the effectiveness of the workforce

Labour productivity
Labour productivity= output per period _
Number of employees per period

Rate of labour turnovers= Number leaving a business over a given period
Average number employed over a given period

Problems with high labour turnover high costs
reduced productivity
Absenteeism…

Page 6

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Chapter 21
Recruitment, selection and training

Workforce planning
job descriptions
advertising
short listing

Training
Training needs
Benefits of training good employees
Induction training




Page 7

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Chapter 22
Motivating employees

Reasons for motivate
Making them work harder
Safety
Keep them happy so they stay
Companies respect

How to motivate
Performance rated pay
Profit sharing
Good feedback

Page 8

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Chapter 23
Making operational decisions

Operational management
Operations management the process that uses the resources of an organisation
to provide the right goods or services for the customer
Operational targets
Unit cost= total cost
Units of output

Punctuality (%) = deliveries on time
Total deliveries

Capacity utilisation (%) = actual…

Page 9

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Chapter 24
Making operational decisions: quality

What is quality?
Appearance
Reliability
Durability
Functions
Image and brand
Reputation
Exclusiveness

Importance of quality to a business
Impact on sales
USP
Impact on price
Cost reductions
Reputation
Training
Distribution

Quality control
Quick
As you only check at the end you wont find all…

Page 10

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Chapter 25
Making operational decisions Customer service

What is customer service?
Customer service identifying and satisfying customer needs and delivering a level
of service that meets or exceeds customer expectations.
Customer expectations what people think should happen and how they think
they should be treated when asking for or receiving…

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