Section 2
Chapter 6 Motivating Employees
Motivation is the reason employees want to work hard and effectively for the
business
Benefits of a Motivated Workforce
1. Higher Output per worker
2. Two-Way Communication --> Suggestion for improvement
3. Low Labour Turnover --> Reduced Recruitment Costs
4. Lower Rates of Absentism --> Less chances of disruptions in production
5. Lower Chances of Strikes --> Less Financial loss from stopped production
6. Willingness to change (new methods of working)
Maslow's Hierarchy of needs
It suggests the next level of the employees current hierarchy should be made
available to motivate them. eg when security needs are met then the employee must
have the opportunity to gain a sense of belonging in the team which will motivate
them to work harder
It is important to identify the level of hierarchy a job provides to make best use of this
Financial Methods of Motivation
1. Wages - a payment for work paid weekly
1. Gets paid on a regular basis so doesn't have to wait long time for money
2. Easier for them to work overtime
3. Have to be calculated and paid weekly costing time
4. Wage clerks are needed
1.1. Time rate - Employee gets paid for 1 hour of work
1. Easier to calculate wages
2. Good and bad workers get paid same amounts
3. Supervisors needed to ensure employees are making good quality products
4. Less work life balance
1.2 Piece Rate - Employee gets paid for each unit of Output
1. Encourages workers to produce more goods
2. May be focused on making large numbers products degrading quality
3. Workers making good quality products get no advantage over rushers
2. Salary - Payment for work paid monthly
1. Easier to calculate salary costs as it is an yearly amount
2. Only Paid once a month
3. Workers may prefer wages
3. Bonuses - Additional payment above basic pay as a reward for good work
1. Workers feel recognised
2. May motivate others to work harder
3. It can become expected each year leading to disappointment
4. Other workers may feel bad and resent the ones getting bonuses
4. Commission - Payment relating to number of sales made
1. More effort will result in more pay
2. If sales staff are too persuasive customers will buy but reputation will go down
3. Very stressful for the sales staff
4. Can lead to competition among staff
[Link] Sharing - A proportion of the company's profit is paid out to employees
1. Sense of Ownership
2. Payout Directly linked to Profit --> Productivity
3. Low profit --> Disappointment
4. Calculated as a percentage of existing salary, lower paid workers receive less
even though they worked as hard as high paying employees
Fringe Benefits - Benefits of working in the business
1. Company Car
2. Discount on products
3. Health care paid for
4. Children's Education fees paid
5. Free Accomodation
6. Company Shares
7. Generous expense accounts
8. Pension
9. Free Holidays
Non-Financial Methods of Motivation
1. Job Satisfaction - The enjoyment derived from feeling you have done a good Job
2. Job Rotation - Workers swapping around and doing each specific task for only a
limited time
2.1 Increases Variety of work
3. Job Enrichment - Looking at a job and adding tasks that require more skills
3.1 Training may be required
4. Teamworking - Dividing workers into groups and giving responsibilities to them
4.1 Workers will feel more in control as they organise themselves and choose what
to do
4.2 Workers organising themselves will lead to job rotation and Enrichment
5. Training - The process of involving workers skills
5.1 Sense of achievement as they gain and apply new skills
5.2 Can be given more challenging work --> Job enrichment
6. Opportunities for Promotion - advancement of an employee within an organisation
6.1 Unlock higher status and feel recognised
Chapter 7 Organisation and management
Organisational Structure - Refers to the levels of management and division of
responsibilities
within an organisation.
Often represented via organisational chart with levels of hierarchy
Chain of Command - Structure in an organisation which allows instruction to be
passed down
from senior levels of management to lower levels
Span of Control - Number of Subordinates working directly under a manager
Advantages of Organisational Chart
1. Shows how everyone is linked together in the organisation allowing for better
communication
2. Every individuals can see their position and can find out who they are accountable
to and
have authority over
3. Shows relationship between different within the organisation
Advantages of a short chain of command
1. Communication is quicker and more accurate
2. Top managers are more in touch with lower level managers
3. Each manager is responsible for more employees --> Encourage Delegation
Directors - Senior Managers who lead a particular department of a business
Line managers - Supervisors who directly oversee a team's daily operations
Staff Managers - Provide support to line managers
The role of Management
● Planning – setting aims and targets for the business – will give a sense of
direction with common targets to work towards
● Organising – arranges the tasks for the employees – as a manager cannot do
all the tasks and will need to delegate
● Coordinating – bringing together the different departments/parts in the
business – so tasks are carried out efficiently
● Commanding – instructs the employees on how to carry out their tasks –
gives guidance as required
● Controlling – makes sure the employees produce the expected output each
week – and that all aims are achieved
● Identifies problems early -- Allows managers to correct issues before they
worsen
Without clear and effective management, a business is going to lack
1. A sense of control and direction
2. Coordination between departments, leading to wastage of effort
3. Control of employees
4. Organisation of resources, leading to low output and sales.
Delegation - Giving Subordinate authority to perform specific tasks
1. Managers Can Focus on important tasks
2. Less likely for managers to make mistake as workload reduced
3. Managers can measure the effectiveness of staff easily
4. Work becomes more rewarding and interesting
5. Employee feel important
6. Helps train workers --> Opportunities for promotion
A good manager should
1. Motivate employees
2. Give guidance and advice to employees they manage
3. Inspire employees they manage to achieve more than they thought possible
4. Manage resources effectively and keep costs under control
5. Increase profitability of the business.
Autocratic Leadership - Manager is in charge and their order is to be followed
1. Quicker decision making
2. Demotivate employees
Democratic Leadership - Employees involved in decision making
1. More ideas --> Better decisions
2. Unpopular decisions (firing employees) cannot be made effectively
Laissez-Faire Leadership - Objectives are made known to employees and they are
left to work
on their own
1. Works well when creative ideas needed
2. Not suitable where consistent decision-making is required --> Can cause
confusion
Chapter 8 Recruitment
Recruitment is the process of actively seeking out, finding and hiring candidates for
a specific position or job.
Job analysis identifies and records the responsibilities and tasks relating to a job.
Job description outlines the responsibilities and duties to be carried out by someone
employed to do a specific job.
Job specification is a document which outlines the requirements, qualifications,
expertise,
physical characteristics, etc., for a specified job.
Internal Recruitment is when the vacancy is filled by by someone who is an existing
employee
1. It is quicker and cheaper than external recruitment
2. The person is already known to the business and their reliability, ability and
potential are known.
3. The person also knows how the organisation works
4. It can be very motivating for employees to see their fellow workers being promoted
5. No new ideas come into the business
6. May increase rivalry
External Recruitment when the vacancy is filled by someone who is not an existing
employee
Part-Time Employees
1. More flexible in the hours of work
2. Easier to ask the work more in busier times
3. Employee is willing to accept lower pay
4. Easier to make redundant
5. Less likely to seek training
6. Less likely to be promoted (lack of experience) --> Less motivation
7. More difficult to communicate
Full-Time Employees
1. Less flexible working hours
2. Higher pay demanded
3. Harder to make redundant
4. More likely to seek training
5. More motivated
6. Easier to communicate with
Induction training - An introduction given to a new employee, explaining the
business's activities, customs and procedures and introducing them to their fellow
workers.
1. Helps new employee settle into their job
2. Less likely to make mistakes
3. Time-consuming
4. Delays employee actually working for the business (wasted wages)
On-the-job training - Watching a more experienced worker doing the job.
1. Individual tuition given and employee does not need to be sent away
2. Training tailored to specific needs of the business
3. Training employee will not be as productive as usual
4. May pass bad habits
Off-the-job training - Involves being trained away from the workplace, by specialist
trainers.
1. A Broad range of skills can be taught
2. Experts trainers have up to date knowledge
3. Business will need to pay high costs
5. Easier for employee to leave and find another job (more skills)
Workforce planning is where a business decides on the type and number of
employees needed in the future. The number required will depend upon the
business's sales forecasts, its future plans such as expansion or automation, and its
objectives
2 Ways to reduce employees
1. Dismissal - Dismissal is when employment is ended against the will of the
employee, usually for not working in accordance with the employment contract.
2. Redundancy is when an employee is no longer needed and so loses their job. It is
not due to any aspect of their work being unsatisfactory.
Chapter 9
Communication is the transferring of message from sender to a receiver who
understands the context of the message
Internal Communication is communication within the organisation
External Communication is communication between organisations or individuals. It is
important for a good image and efficiency of a business
Feedback is the reply from the receiver which shows whether the message has been
understood or not and if necessary been acted upon
One-way communication occurs when the receiver of a message has no chance to
reply or respond to the message. One-way communication does not allow the
receiver to contribute to communication or to provide any feedback.
Methods of Communication
● Letter – Used for formal communication, e.g. informing an employee of
dismissal.
● Report – A detailed document explaining a specific issue or problem.
● Notice / Poster – Displayed publicly so all employees can read important
information.
● Text message – Quickly sent to employees’ phones; can be reread later.
● PowerPoint presentation – Delivers visual information during meetings with
employees or managers.
● Meeting / briefing / video conferencing – Communicates information to many
employees at once and allows immediate feedback.
● Face-to-face conversation – Enables the manager to discuss sensitive issues
directly and respond to reactions.
Two-way communication is when there is a reply or a response from the receiver.
This could be just simple confirmation of receipt of the message or it could be a
discussion about the message. Both people are therefore involved in the
communication process. This could lead to better and clearer information.
Advantages of Two Way communication
1. Sender can know if the message has been understood or not leading to better
communication
2. Receiver is also included in the communication process which can motivate
them
Choosing the appropriate communication method
1. Speed
2. Cost
3. Need for written record
4. How detailed the message is
5. Need for feedback
6. The Receiver
7. Leadership style
<Read Communications Revision Summary PG 124>
Communications barriers are factors that stop effective communication
<Read Table PG 126 + Revision Summary PG 127>