HBM What I Need to Know

8/9/2019 HBM What I Need to Know

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KNOX ACADEMY

HIGHERBUSINESS

MANAGEMENT

WHAT YOU

NEED TOKNOW


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CONTENTS

Business Decision AreasBDA: Marketing....................................................3

BDA: Operations..................................................6

BDA: Financial Management................................8

BDA: Human Resources.....................................10

BE LO 1 - Business in Contemporary Society.....12

BE LO 2 - Information and IT..............................14

BE LO 3 Decision Making in Business..............16

BE LO 4 - Internal Organisation.........................18

External Assessment..........................................19


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BDA: Marketing

What is a market?What is marketing?

Consumer/industrial

Role and importance of marketing IdentifyAnticipateSatisfy

Marketing as a strategic activity

Product-orientatedMarket-orientated

Marketing of products and services

Marketing environment Consumer trendsAge distributionGenderDisposable incomeHousehold statusSocial class ( class tables )

Taste, fashion and lifestyle Competition Government Economy Technology

Branding Brand loyaltyUnique selling pointOwn brandsGeneric

Marketing mix ProductPrice

PromotionPlace

Product CoreAugmentedProduct life cycleExtension strategies

Product mix Boston matrix Problem Child, Star, CashCow, Dog

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Product innovation Research and development

Price ImportancePricing strategies - low, market, high TacticsShort-term skimming, penetration,destroyer, promotionalDemand-orientated pricing

Place Channel of distribution- producer, wholesaler, retailer, consumerPhysical distribution decisionsFactors affecting distribution

Main channels of distribution The wholesaler The retailer Direct selling Mail order Direct response advertising Telephone selling Television selling E-commerce

Promotion Aims

Persuading Informing Reminding

Types Above the line Below the line

Advertising Informative Persuasive

Advertising decisions Print media Broadcast media Outdoor media

Controls on advertising

Sales Promotion Into the pipeline Out of the pipelinePersonal sellingPublic relationsPublicity

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Target markets UndifferentiatedDifferentiatedSegmentation eg age, sex, income, etc

Personal sellingNiche marketingMarket shareMarket growth

Market research What is market research?Need for market research

Methods of research Primary Secondary

Primary field Techniques questionnaires, personalinterview, telephone interview, testmarketing, postal survey, consumer panel

Secondary - desk internal eg sales figures- external eg government publications

Information technology and marketresearchSampling (see extra notes)Problems with market research

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BDA: Operations

Role and importance of operations Operating systems Input Process Output

Operations management Purchase and storage of raw

materials Production and storage of finished

goods Distribution of the finished goods

Production systems Factors when deciding

Nature of the product Quantity to be produced Resources available Labour Capital

Methods of production JobBatchFlowExamples

Advantages/disadvantages - learn

Factors affecting quality Quality assuranceQuality controlQuality standards eg BS5750, Kite Mark

Total Quality Management learnfeatures

BenchmarkingQuality circles

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Stock control Types Raw materials Work-in-progress Finished stock

Monitoring stock levels Stock record cards Spreadsheet

Maximum, minimum, re-order level(diagram)

Storage Just-in-time learn advantages and

disadvantagesCentralised/decentralised learnadvantages and disadvantages

Purchasing mix QuantitySupplier price, delivery dates, quality,etc

Payment systems Time-rateOvertimePiece-ratePiece-rate + fixed pay elementCommission paymentsFringe benefitsBonusesIncentives to professionalsContract employmentProfit-sharing schemes

Motivation for employers and

employees when devising paymentsystems

Distribution and delivery Warehousing Design and layout Mechanical handling Transportation

Transport and delivery of goods to thecustomer

Scheduling

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BDA: Financial Management

Role and importance Adequate fundsControl costsEnsure adequate cash flowControl profitability levels

Cash flow Definition

Financial information Balance sheet list of assets andliabilities and how they are financedFixed AssetsCurrent AssetsCurrent Liabilities

Working CapitalFinanced by

Trading, profit and loss account overall profit of companySalesCost of goods soldGross ProfitExpensesNet Profit

Interpretation of Final Accounts Trading, Profit and Loss accountBalance Sheet

Ratio analysis Purposes of interpretationUses of Ratio Analysis (Advantages)Limitations of Ratio Analysis(Disadvantages)

Profitability gross profit margin, netprofit margin

Efficiency - return on capital employedLiquidity working capital, acid test

Budgetary control Uses of budgetsCash Budgets

Types eg sales, productionImportance to the role of management

Using financial information ReviewingPlanningComparing

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Users of information Internal eg managers, employees

External eg general public, government

Limitations of financial analysis HistoricMethods of stock valuationInflationVariations in accounting standardsIntangibles are subjective eg goodwillDoes not take into account morale/staff turnover etc

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BDA: Human Resources

Role and importance of HumanResource Management

Function within organisationsRoles Facilitator Audit Consultancy Executive Service

FACES

Activities of HR function Strategic eg personnel policies Tactical eg staff training anddevelopmentOperational eg selecting applicants

HR planning Potential future staffing requirementsHow to motivate employeesHow to support staff

4 categories: New staff Potential staff Existing staff Departing staff

Changing patterns of employment Full-timePart-timeWomenCasual

The workforce part-time, variablehours, temporary work, self-employment

Implications for the organisation

Recruitment Identify vacancy Job analysis Job descriptionPerson specificationInternal and external sources

Selection Application forms

ReferencesInterviews

Psychological tests

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Intelligence testsPersonality testsAptitude testsAttainment tests

Training and staff development Why train? costs and benefits

TypesInduction trainingOn-the-jobOff-the-jobStaff developmentAppraisal

Employee relations The ways in which employers deal withtheir employeesMain institutions - ACAS, employersassociations, trade unions

Processes in employee relationsNegotiationConsultationArbitrationCollective bargaining

Employee representation Works councils, employee directors, etc

Development of policies Appraisal Grievance Discipline Health and safety

Personnel information and recordkeeping

Basic employee data TrainingAbsence, etc

Legislation Health and Safety at Work Act 1974Sex Discrimination Act 1975 (1986)Race Relations Act 1976 (Commissionfor Racial Equality)Employment Protection ActsEqual Pay Act 1970Minimum Wage Act

Industrial tribunals

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Sources of finance and assistance Internal retained profits

ExternalShort-term eg bank overdraftMedium-term eg bank loansLong-term eg mortgagesGovernment eg Scottish Enterprise

Growth Horizontal integrationVertical integrationConglomerate integration(diversification)Demerger

DivestmentContracting out/outsourcingManagement buy-out/managementbuy-in

Business as a dynamic (ever-changing)activity

Internal pressures eg newmanagement, new technology,financial change

External Pressures (PESTEC) Political/legal Economic Social Technological Environmental Competitive

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BE LO 2 - Information and IT

Sources of Information Primary/SecondaryInternal/External

Costs and benefits of different sourcesof information

Types of Information Qualitative/quantitative

Formats Oral Written Pictorial Graphical

Numerical

Value of information Accuracy TimelinessCompletenessAppropriatenessAvailabilityCost effectivenessObjectivityConciseness

ICT in business Mainframe, desktop, laptopComputer networksLocal area networksWide area networks

Telecommunications The internetElectronic mailMulti-media systems

Teletext

Interactive videoVideo conferencingFaxEPOS, EFTPOS

Learn features of websites

Business software Word ProcessingDatabasesSpreadsheetsDesktop PublishingPersonal productivity softwarePresentation software

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Uses of ICT ICT and decision makingICT and production

Costs and benefits of ICT

Legislation Data Protection ActComputer Misuse ActCopyright, Designs and Patents ActFreedom of Information Act

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BE LO 3 Decision Making in Business

Nature of decisions What to produce Where to locate premises Method of production How many staff to employ What price to charge

Types of decision Strategic set out aims of organisation- long term

Tactical set out objectives of organisation - medium termOperational day-to-day - short term

Review/evaluation/alteration

Who makes decisions? Strategic most senior people Tactical most senior people or middlemanagementOperational manager, section head orindividuals

Who needs to know about decisions? Mission statement summary of strategic aims of the company

Role of managers PlanOrganiseCommandCo-ordinateControlDelegateMotivate

Decision making model Start - Identify the problem

Finish - Evaluate

POGADSCIE

IT and decision-making Internet/Databases/Spreadsheets

SWOT Analysis StrengthsWeaknessesOpportunities

Threats

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Problems of structured models Time-scaleAbility to collect all informationProblems of generating alternativesolutionsLack of creativity

Benefits of structured process of decision-making

Aids to decision-making BrainstormingPESTEC analysis

- Political- Economic

- Social- Technological- Environmental- Competitive(see LO 1)

Factors affecting quality of decisions Quality/quantity of information used TrainingRisk taking

The human element

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BE LO 4 - Internal Organisation

Grouping of activities FunctionalProduct/serviceCustomersPlace/territory

TechnologyLine/staff

Functional activities Advantages/disadvantages of groupingby function

MarketingHuman resourcesFinance

OperationsResearch and development

Organisational structure HierarchicalFlatMatrixEntrepreneurialCentralised/decentralised

Aspects of organisational structure ChartsSpan of controlLine relationshipsFunctional relationshipsStaff relationshipsFormal and informal structures

Awareness of organisational culture Corporate culture

Changes in structure De-layering

Downsizing

Role and responsibilities of management

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External Assessment

- based on a written paper of 2 hoursduration

The paper will consist of 2 sections:

Section One - 50 marks

Knowledge and understanding, problemsolving and decision making will be assessedthrough a case study or interpretation of about 750 words. All questions are

compulsory and all areas of the course arecovered.

Section Two - Extended response - 50 marks

The main purpose of this section will be toassess knowledge and understanding. Youwill be required to answer 2 questions froma choice of 5. Each question will be worth25 marks. Each question is integrated andcan cover 2-3 areas of the course.

HBM What I Need to Know

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