AS-level CIE Business Studies revision notes - adapted

This is a very unique revision guide that has helped me a lot with my exam last year. I made this mostly based on the actual information and definitions from the CIE mark scheme, and of course from the official textbook as well. So I think the structure and the wording would be more specific to the exam and that it would help you to gain marks more easily because these key words are what the examiners are searching for.

I hope this will be useful to your studies!

Best of luck to all! 

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  • Created by: Cherrie.T
  • Created on: 07-06-12 00:34
Preview of AS-level CIE Business Studies revision notes - adapted

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Business Studies Revision Notes
· Organisaional structure ­ The internal, formal structure of a
business that shows the way in which management is organized
and linked together and how authority is passed through the
It indicates formal relationship between different people
and departments
It shows the chain of command (the way in which
authority is passed down the business)
It shows the span of control (number of subordinates
reporting to each manager)
Helps individuals to see their position in an organisation
Allows staff to be aware of their responsibilities
See who has authority over them, and to whom they are
accountable for
· Hierarchy - the order of management in an organisation ­ lowest
to highest ­ showing chain of command and the way authority is
organised/distributed ­ levels of accountability
Roles and relationships made clear
Accountabilities and controls are established
Information and communication channels are established
Authority and responsibility levels established
Line management authority made clear
Very appropriate for some organisations (e.g. Army) with
many levels and narrow spans of control
Supportive of bureaucratic organisations requiring
detailed control
One-way communication (not efficient)
Few links between departments (may lead to lack or
Inflexible (change resistance) because all managers are
trying to defend their own position in the hierarchy and
the importance of their own department
· Matrix structure ­ an organizational structure that creates
project teams that cut across traditional functional
departments - an emphasis away from functions towards

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Encourages team approach
Staff are assigned by ability and skill, not rank or position
Allows total communication between all members of the
team and traditional departmental barriers broken down
More varied work
Greater motivation for staffing multi-disciplinary teams
Reduces bureaucracy and control
Staff focus on what is good for the business as a whole
not just only for their department
Allow people to share ideas and find the best solution
Less direct control from the senior managers
Senior managers may not want to…read more

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Feedback of ideas from the workers will be more
It requires a higher level of management skill to control a
greater number of employees, so there is less
management skill required
· Economies of Scale ­ The benefits gained through increased size and
output. An increase in output leading to a less than proportionate
increase in costs (less unit cost)
· Easier to raise finance.…read more

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More hierarchy and bureaucracy as organisation expands and
Chain of command lengthens
Efficiency reduced resulting in an increase in output that causes
a more than proportionate increase in average costs
Decision-making becomes more complex
Communication slows
Too many middle managers
Spans of control become ambiguous
Too much diversification by business leads to lack of focus
Employees become de-motivated
Some may distinguish internal and external diseconomies.…read more

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Can lead to higher productivity + output level
But may lead to low quality and safety levels as
workers rush to complete units
Workers may be settle after certain pay level,
therefore will not be motivated anymore after that
Provides little security over pay level
Not appropriate if each product is different
· Salaries ­ Fixed annual income paid to workers on a
monthly basis.…read more

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Profit Sharing ­ Bonus paid to staff based on profits of the
business.…read more

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Job enrichment ­ Organising and improving the work
processes and environment so they are more satisfying to
employees. Often involves reduction in supervision and
give more control and responsibilities to workers.
Give workers complete units of work so their efforts
can be identified and more challenging work is
Give direct feedback on performance to allow each
worker to be aware of their own progress
Give more challenging range of tasks beyond
worker's experience.…read more

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Increase productivity and reduce Training may be needed which is
labour turnover expensive
Better solutions to the problems as Can be conflicts within teams and
workers help each other lead to lower productivity
Reduce management costs because Teams can develop attitudes
fewer managers will be required against business so appraisal is
Complete units of work can be needed to ensure that they are
given to teams working towards the main aim
· Target setting ­ Setting up goals for workers to achieve so
that work…read more

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Maslow ­ The Hierarchy of Needs
Human needs start at the lowest level of the hierarchy
Once one level of needs has been satisfied, human will
strive to achieve the next level
Once a need has been satisfied, it will no longer motivate
individuals to action
Reversion is possible
· Disadvantages:
Not everyone has the same needs as assumed by
the hierarchy
In practice it can be hard to identify the level of
needs an individual is at and whether it is being
satisfied or…read more

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Level of need Business conditions to satisfy
Self-actualisation - feeling of Give workers more challenging
satisfaction or happiness when tasks ­ this gives a sense of
learned or achieved something achievement and opportunities to
develop new skills and increase
Esteem needs Recognition for work done well ­
status, promotion and responsibility
will gain the respect of others
Social needs Working in teams and ensuring good
communication to make workers
feel involved
Safety needs A contract of employment with
some job security ­ health…read more


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