GCSE Business Studies Unit 2

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  • Created on: 08-02-18 13:53

Leadership Styles

1) Autocratic: The manager will make the decisions themsleves and will not listen to the other employees. Theings tend to get done more quickly, however, employees may not feel as valued, although that dpends on the employee. 

2) Democtractic: They will listen to you, thye will still make a decision by themsleves but will take the employees' views into acccount. It is more motivating, however, decisions may take longer to act upon. 

3) Theory X/Y manager: X:Believes that employees don't work hard enough, thus puttting pressure on the employees; they use incentives as a way of motivating empployees. Y: Believes that employees want to work hard and that they are self- motivated, thus, they will not need incentives. 

4) Laissez Faire Manager: They will give the employees responsibility and don't get involved themsleves. It's a very hands- off approach. 

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Appraisal

What is it?

Appraisal is making a judgement about an employee's perfomance within a business and setting new individual targets through the process. They can happen annually or monthly, it depends on the business. 

Why should a growing business use appraisals?

- It can motivate staff to work hard and achieve their targets.

-They can help staff retention (keeping staff) which is important as recruiting and training new employees is very costly.

-Employees can be motivated by being able to communicate with the manager- thye may feel valued. 

The Process of Appraisal: 

Employee and manager meet, Employee's perfomance and work is evaluated during an interview. New targets are set for the next period. More training may be required and given in order fot employees to improve and reach their targets. 

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The Product Life Cycle

1) Introduction/ Launch:

Sales are low and usually slow. The price depends- they're either skimming or using penetration pricing. There's a low of promotion- costs are high. The profits are low due to initial costs (often making a loss) 

2) Growth:

Sales are steadily increasing, promotion is still high, still using penetration/ skimming is used. They're breaking even.

3) Maturity: 

Sales start to slow down, there is less or little promotion, the price is competitive and the degree of competition is high. Profit margin is at its highest. 

4) Decline:  

Sales are decreasing rapidly, promotion is limited, the company is makiing a loss.

-Remember, not all products go through the same stages. 

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Extension Strategies

Image result for picture of extension strategies (http://www.sanandres.esc.edu.ar/secondary/Marketing/images/pic260.gif)

Some ways you can extend a products life cycle: 

Packaging, discounting, re-branding, expanding abroad, ad-ons introduced, find new target markets, change the design/ style, improve or change ingredients, create new sizes of products, making it more ethical. 

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Pricing Strategies

Cost Plus: Adding a percentage profit margin to the cost of producing the good, it allows the company to decide its profit margin. It is used when it is easy to calculate the cost of making a product.

Competitive Pricing: Setting a price based on the prices competitors charge. 

Penetration Pricing: setting a low price initially for a new product to break into the market, the product becomes attractive to the customers, so then, the customers get used to buying it, thus increasing customer loyalty. Then, the price is raised at a later date as the product gains market share. 

Skimming/ Creaming (creaming is an old term): Selling a product at a high price in order to earn high profits, used when a product is unique and will be bought by those who are willing to pay for it at a high price. 

Loss Leaders: Selling gooods for a price lower than it costs to make, it is used to get ridf of old, outdated goods. It is often used in supermarkets to encourage customers to come in and buy other, higher priced items. Eg, a printer (quite cheap) and ink (more expensive)

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On The Job Training

Takes place withing the work[placeand occurs alongside an existing, experinced worker. 

The advantages: Helps to familiarise them with the company, it's relatively cheaper, gives the person teaching experience, more specific to the company, productivity is constant, and employees start the job much quicker. 

The disadvantages: They may not bring in any new ideas, may not lead to dramatic improvements, the experienced worker is less productive, work produced by the emplyee may not be substandard,m and it is still NOT free. 

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Off The Job Training

When the employe is trained away from the firm/ work place- it may take place in a college training centre, a TEC or in-house training. 

The advantages: brings in new ideas, gives the employee training experience, employees are more likely to feel valued as they are being invested in, and it allows the employee to meet new people. 

The disadvantages: it is expensive for the firm, it slows productivity down, less specific to the job- not working in their normal environment, it is not easy to put the action into the workplace, it is time costly amd employees may leave to another business after receiving the required training. 

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Motivation (1)

Encouraging employees to work harder than they would. This can be achieved through financial and fringe benefits. 

Financial benefits: Bonuses, pensions, piece-rate system, time rate, share-options, commission, paid shares, and performance related pay. 

Non- financial benefits: giving employees more demanding jobs, getting employees to carry out a variety of duties, arrange employees to work in teams, using training, through fringe benefits (staff uniform, subsided lunches) or using the appraisal system to make the employees feel more valued.

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Motivation (2)

Maslow's level of hierachy: 

Image result for maslow's level of hierarchy

Now test yourself, what are the levels in the hierachy? 

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Flow Production:

Flow produvtion is a continuous process.

This links to specialisation as well as division of labour to which there are several benefits and costs at the same time. Specialistaion means that an employee will become very skilled in a particular area of the job, however, that may lead to increased boredom. Furthermore, by having divisions of labour, it makes it easier to identify any faults or find where the faults have come from which means that staff will be better trained in the future. 

Flow Production also produces very large amounts of output of a product which mnay be favourable to various businesses such as Coca Cola, for example. 

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