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AQA Level Business Unit 2 Notes - Management, Leadership & Decision Making
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Detailed Notes for AQA Unit 2 Business allowing you to achieve an A*/A
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UNIT 2: MANAGERS, LEADERSHIP AND DECISION MAKINGChapter 4 – Understanding management, leadership and decision making
Functions of Management
Management is planning, organisation, directing and controlling all or part of a business
enterprise
1. Planning:
• Is a continual process that has to adapt to internal & external influences
• Planning helps reduce change of failure – they highlight problems and encourage
managers to find solutions
• Contingency Plans = Plans that help managers overcome emergencies or crises
Involves…
• Setting objectives or targets for the business or an area of the business
• Conducting analysis in order to make forecasts of key data (e.g. business costs,
competitor’s prices etc…)
• Drawing up plans for functional areas (e.g. finance, HR etc…) which fit together to
help the business meet its aims
• Estimating the likely resources for any proposed plans
2. Organising:
• Managers must acquire, assemble and maintain resources that they need so that the
business can carry out its activities – these resources include…
→ Land (and buildings)
→ Labour
→ Capital
• A well-managed business will plan carefully and may seek to use a minimum of
resources to achieve its objectives
3. Directing:
• Through directing, management is able to influence and oversee the behaviour of
the staff in achieving the business’s goals, as well as providing the necessary
resources – employees are led through…
→ Motivation = The willingness to achieve a goal/target
Employees that are highly motivated generally perform better
E.g. providing financial incentives/grant authority
→ Communication = The exchange of information between or more people
Effective communication helps to achieve high levels of productivity and
encourages employees to use their initiative to solve problems
E.g. praise/clear guidance
4. Controlling:
• Involves setting standards using the objectives, and reviewing and reporting on
performance – managers can report on business performance in a number of ways…
→ Financial Reports = Provide details about financial performance each year
→ Employee Performance = Provide information on productivity, absenteeism and
training costs
, UNIT 2: MANAGERS, LEADERSHIP AND DECISION MAKING
→ Social Performance = Business performance in terms of behaving ethically,
minimising pollution and creating jobs
• Once performance has been compared to objectives, management needs to identify
any corrective or preventative action required
• Reviewing is an important process as it allows reflection and judgement on what has
been achieved and encourages further decisions to ensure the business achieves the
objectives
Managers and decision making:
Each of the functions entails decision making for managers…
1. Planning – Managers need to decide what objectives should be set
2. Organising – Managers have to decide what resources will be needed to allow the
business to fulfil objectives as efficiently as possible
3. Directing – Managers have to decide the best way to motivate and communicate with
employees so that they work effectively
4. Controlling – Further decision making; which aspects require corrective action
Mintzberg’s Roles of Management
He argued that management is about what managers do – managers perform 10 roles
which fall into categories…
Role Category
1. Figurehead
2. Leader Interpersonal Management
3. Liaison
4. Monitor
5. Disseminator Informational Management
6. Spokesperson
7. Entrepreneur
8. Disturbance Handle Decisional Management
9. Resource Allocator
10. Negotiator
Interpersonal Management:
Involves managing through other people – you provide information and ideas
1. Figurehead
• As a manager, you have social, ceremonial and legal responsibilities
• You’re expected to be a source of inspiration/someone people can turn to for help
and support
• You have authority and represent your colleagues
2. Leader
• Creates and maintains an effective working environment
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