UB Overview Flashcards
(22 cards)
What is an objective in a business context?
An objective is a specific goal or target that a business aims to achieve. Objectives give the business direction and help measure success.
What is profit maximisation and why is it important?
Profit maximisation means aiming to make the highest possible profit. It’s important for reinvestment, rewarding shareholders, and business growth.
What is meant by ‘survival’ as a business objective?
Survival means continuing to exist, particularly important for new businesses or during economic downturns when risk of failure is high.
Why might a business focus on increasing market share?
To gain a competitive advantage, benefit from economies of scale, increase influence in the market, and improve brand recognition.
What is the difference between sales maximisation and profit maximisation?
Sales maximisation focuses on increasing volume of sales, possibly sacrificing profit margins, whereas profit maximisation prioritises the highest return.
What is corporate culture?
Corporate culture is the shared values, beliefs, attitudes, and practices that shape how employees behave and interact within a business.
Why might an organisation want to improve its corporate culture?
To boost employee morale, improve productivity, reduce staff turnover, attract talent, and align behaviour with business goals.
What are three benefits to an organisation of improving its corporate culture?
Higher productivity – Motivated employees work more efficiently
Better employee retention – Staff are more likely to stay in a positive culture
Stronger brand reputation – A good culture enhances public and customer perception
How does a strong culture support change within a business?
Employees who feel valued and aligned with the company’s mission are more likely to support change initiatives and adapt quickly.
How can a positive culture improve customer satisfaction?
Motivated and engaged employees provide better service, leading to happier customers and increased loyalty.
What is a hierarchical (tall) structure, and what are its advantages and disadvantages?
A tall structure has many levels of management and a narrow span of control.
✅ Clear authority and promotion paths; close supervision
❌ Slow decision-making; poor communication between layers
What is a flat structure, and what are its advantages and disadvantages?
A flat structure has few levels of management and a wide span of control.
✅ Faster communication; employees feel more empowered
❌ Managers may be overstretched; less supervision
What is a matrix structure, and what are its advantages and disadvantages?
A matrix structure involves employees working across departments and reporting to multiple managers.
✅ Encourages teamwork; effective use of skills
❌ Conflicting instructions; confusion over roles
What is an entrepreneurial structure, and what are its advantages and disadvantages?
Decisions are made centrally by one person or a small team, common in small businesses.
✅ Quick decisions; strong control
❌ Overloads decision-makers; staff may feel demotivated
What is centralised decision-making, and what are its pros and cons?
Decisions are made by senior managers or head office.
✅ Consistent decisions; easier to control
❌ Slower response to local issues; staff feel less valued
What is decentralised decision-making, and what are its pros and cons?
Decision-making power is given to lower levels or branches.
✅ Faster decisions at local level; improves motivation
❌ Risk of inconsistency; less control from the centre.
Why might a business change its organisational structure?
To improve efficiency, adapt to growth, respond to external factors, improve communication, or better meet customer needs.
What is functional grouping, and what are its advantages and disadvantages?
Staff are grouped by department based on their job function (e.g. marketing, finance).
✅ Staff are experts in their area; clear structure and accountability
❌ Poor communication between departments; can lead to “silo” mentality
What is product/service grouping, and what are its advantages and disadvantages?
Staff are grouped around specific products or services the business offers.
✅ Focus on product performance; easy to identify success/failure
❌ Duplication of resources (e.g. each product may need its own finance team)
What is customer grouping, and what are its advantages and disadvantages?
Staff are grouped based on the type of customer served (e.g. retail, corporate).
✅ Services tailored to specific customer needs; improved customer satisfaction
❌ Duplication of roles; harder to share resources across groups
What is place/territorial grouping, and what are its advantages and disadvantages?
Staff are grouped based on geographical location (e.g. Scotland, Europe, Asia).
✅ Better local responsiveness; helps meet regional needs
❌ Inconsistent service levels; difficult to control from head office
What is technological grouping, and when is it used?
Staff are grouped based on the process or technology they use.
Used mainly in manufacturing industries.
✅ Specialised expertise in processes; efficient use of equipment
❌ Only suitable for large-scale, production-focused businesses
