3.4 Flashcards
(25 cards)
What is Short-termism
Is a quick financial reward
-monthly profit
-weekly sales
Corporate timescales
Corporate timescales refer to strategy, and the expectation of when a return on investment will be achieved
Management is likely to focus on:
-pursuing growth in sales
-Increasing profit
-Driving unit cost down
-improving return on capital employment (ROCE)
What causes short-termsim
- Plc is often under pressure to produce dividends for the stakeholder
-Many benefits, perks and financial rewards in businesses are based on meetings, short-term goals e.g. Daily sales target
-there are any changes in leadership or strategy, maybe major or takeover, the management may want to put their own stamp on direction
Disadvantages of short-termism
- Doesn’t focus on building a sustainable competitive advantage, overtime
-Is reluctant to invest in the business e.g. Training, capacity, research and development
-A decision in short term may not be good for long-term
Advantage of short termism
-Good for immediate shareholders
-Good for immediate growth
What is long-termism
-Corporate timescale refers to strategy and the expectation of when it return on investment will be achieved
-Long-termism is a whole business approach
-incorporates corporate social responsibility
-Considers ethical behaviour of the business in decision-making
-Staff development is seen as a long-term objective of the business to retain and develop staff
-Long-term investment tech investment secure data for the future
-Showing care is important
What is evidence based decision-making?
-Decisions relating to the business are based on evidence and data, which is valid and trusted information. scientific in its approach. But can be time-consuming.
-evidence based approach, including:
Sales forecasting
Investment appraisal
Decision Tree
What is subjective decision-making
-decision relating to a business which are based on personal perspectives, feelings and opinions
Corporate culture
- A businesses culture and their beliefs can guide their practices. Corporate culture could even inform the mission statement or vision statement.
features of strong culture
-strong cultures have good communications with employees
-they focus on core value
-the recruitment/training tries to find individuals who best fit the culture of the bus
features of weak culture
-a weak culture often leads to bus failure
-it will have a demotivated workforce
-there will be inconsistent customer service
-it may be poorly managed
-it will be very bureaucratic and lack flexibility to respond to dynamic markets
Handy four classes of culture
-power culture
-role culture
-task culture
-person culture
Power culture
-in a power coach that is a central figure that will make decisions
-There are a few rules and procedures
-there is a competitive attitude among employees to gain power
Role culture
-decisions in a role culture are made through well established rules and procedures
-power to make decisions in a role culture comes from the job title e.g. Marketing director.
-This is very bureaucratic culture and may evolve lots of paperwork
Task culture
-in a task culture, the focus is on a project that needs to be completed
-The power in the task culture comes from those who can accomplish the tasks and have expertise e.g. car design
-this involves team on a project a team of expert working together
Person culture
-in a person culture that are grouping of similar skills, people who share experts and knowledge
-These all work on client by client basis, rather than project by project basis (task culture)
-e.g. Lawyers, accountant, doctors
how do you think culture is formed with a bus
-Rola found as an owners are key decision skills based around their ethics or influence
-The nature of business and its sells
-The degree to which products have changed overtime
-The business environment when it started
-The recruitment process of key staff
-Working hours
-attitude to customer service
Stakeholders
A party that has an interest in a company and can either affect or be affected by the bus
shareholders
a person, company, or institution that owns at least one share of a company stock
internal stakeholders
A group or individual within an organisation who have an interest in the bus
-employees
-managers
-owners
External stakeholders
Group/individuals outside an organisation who have an interest in the bus
-suppliers
-customers
-society
stakeholders vs the directors
-The directors as well as being responsible for the running of the business or responsible to the stakeholders and act on their behalf
-as such they sent the shareholders interest, this can lead to conflict
Bus ethics
The moral principles, polices, and values that govern the way bus and individuals engage in bus activity
