UNIT 2 PEOPLE IN BUSINESS

MOTIVATING EMPLOYEES
Motivation - it means stimulating or influencing the behaviour of workers towards achieve a set of business
goals.

Importance of motivation

 It helps to increase the effort and commitment of employees

 It reduces absenteeism, industrial disputes and falling productivity of the business
 It helps to increase profitability and reputation of a business
 It helps to increase the efficiency of labour force
 Best utilization of resources
 Increases the willingness to Contribute
 Reduction in Labour Problems
 Increases in production and productivity
 Increases the co-operation between employees and management

Factors influencing the motivation at work

 Money
 Job security and job satisfaction
 Promotion
 Status
 Training
 Fringe benefits - non - cash rewards such as company cars, health insurance, pensions and discounts
on company products etc.
 Variety of tasks
 Friendship
 Clean and safe work place
 Responsibility

Benefits of a well-motivated workforce

 Improved productivity
 Low rate of absenteeism
 Low rate of labour turnover
 Better quality goods and services
 More competitive and reduce average costs
 Easy to achieve business objectives
 Improve efficiency of employees
 Produce standard quality goods and services
 High labour productivity – a measure of the efficiency of workers by calculating the output per
worker.
 Easy to manage a well-motivated work force
 Motivated work force will work with management and improve the performance of the business

Absenteeism – workers non-attendance at work without good reason.

Labour turnover – the rate at which workers leave a business.

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Advantages of motivation
 Increased productivity
 Higher quality - higher customer satisfaction
 Lower labour turnover
 Lower recruitment and selection costs
 Better communication and teamwork with each other.
 Better customer service
Disadvantages
 Motivational rewards may become expected, so when employees achieve them it does not motivate
them, and if they don't achieve them it can be de-motivating
 May be de-motivating for other employees if they are not motivated as much as other employees.
 Financial motivation such as piece rate quality may suffer as they are trying to rush.
 Non-financial motivation such as job rotation lacks specialisation and is time-consuming to change
between roles.

The concept of human needs – Maslow’s Hierarchy

Abraham Maslow identified the main needs of human which are known as Maslow’s Hierarchy of Needs.

SELF ACTUALISATION NEEDS

Reaching one’s potential

ESTEEM NEEDS
Respect from others, recognition
for a job well done, status

SOCIAL NEEDS
Friendship, acceptance, belonging to group

SAFETY NEEDS
Health and safety at work, job security, free from threats

PHYSICAL NEEDS
Water, food, clothing, shelter and rest

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  Physical needs –these are the basic needs we must have to be able to survive. It includes, water, food,
shelter, clothing and rest.
 Safety needs – human must be safe from physical danger and individuals need to know that they
have job security.
 Social needs –most people want to be accepted by others and to feel that they are loved and trusted.
It is important to have friends and belong to a group where social activities can be shared and
enjoyed together.
 Esteem needs – individuals want to be respected and to have their achievements recognised by
others. For some people having a certain status is also an important need.
 Self-actualisation - it refers to the need for personal growth and development throughout one's life.
F.W. Taylor – scientific management theory
Taylors scientific management theory aims to reduce inefficiency in the workplace by finding the quickest
method of performing each task and then training all workers to use this method.
Taylor’s argument:
 Workers do not naturally enjoy work and so need close supervision and control
 managers should break down production into a series of small tasks
 Workers should then be given appropriate training and tools so they can work as efficiently as
possible on one set task.
 Piece – rate payment
Taylor’s theory
 All individuals are motivated by personal gain
 Humans are only motivated by money
 Taylor suggests piece-rate method of payment [piece rate – paying workers for each unit produced]
 People work hard and produce more products if they get more money
 Workers must be paid a fixed rate for every unit they produced
Frederick Herzberg – two factor theory
Herzberg conducted a research and identified two group of factors that motivate people at work. The two
factors are:
 Hygiene factors –the factors that must be present in the workplace to prevent job dissatisfaction.
The hygiene factors are:
 Working conditions – provide clean and safe work place and other facilities for workers. For
example, wash rooms, drinks machines and canteen for meals.
 Relationship with others – this factor considers the importance to a worker of having a good working
relationship with other workers – the need for friendship, and to belong to a group – and a good
relationship with managers – to be treated fairly and with respect.
 Salary and wage – Herzberg say that people have to be paid enough to encourage them to do a job,
but money is not enough for them to do a job well.
 Supervision – this factor considers the importance of leadership style and how closely workers are
supervised.
 Company policy and administration – these are the rules and procedures which control and affect the
way that workers work and their relationship with others in the workplace.
Providing Hygiene factors to employees will prevent job dissatisfaction but it will not motivate workers to
work more efficiently.

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  Motivating factors – the factors that influence a person to increase their efforts.
The motivating factors are:
 The work itself – challenging and variety in job will influence the workers to work hard.
 Responsibility – giving more responsibility for their tasks will highly motivate the workers.
 Advancement – workers must have the opportunity for promotion
 Achievement – workers need to feel that they have reached challenging goals
 Recognition of achievement – workers must be recognised and accepted for their achievements by
the management.
According to Herzberg, managers can use one or more motivators in order to increase the motivation of
workers. However, these motivators will not work unless the availability of hygiene factors.

Methods of motivation
Managers can motivate workers in several ways. These can be divided into financial rewards and non-
financial rewards.
Financial rewards – it means cash and non-cash rewards paid to workers which are often used to motivate
workers to increase their efforts.
 Hourly wage rate – it means the payment to workers based on a fixed amount for each hour worked.
This method pays workers for the number of hours at work.
 Salary – it is fixed annual payment to certain grades and types of staff not based on hours worked or
output. It will be paid monthly.
 Piece – rate –it means payment to workers based on the number of units they produced. This method
pays the number of quantities they have produced.
 Commission – payment to sales staff based on the value of items they sell. It is based on the value of
sales made by staff.
 Bonus – it is an additional reward paid to workers for achieving targets set by managers.
 Performance related pay – a bonus scheme used to reward staff for performing to the required
standard.
 Fringe benefits –non – cash rewards often used to recruit or retain workers and to recognise the
status of certain employees. It is an alternative to cash payments. For examples, company cars, health
insurance and pensions.
 Profit sharing – an additional payment to workers based on the profits of the business.
 Time rate system - Time rate system is a method of wage payment to workers based on time spent
in the factory for the production of output. According to this system, wages are paid on hourly,
weekly or monthly basis.
Advantages and disadvantages of financial rewards

Piece Rate system

Advantages:
 encourages productivity
 work and reward
 cost effective

Disadvantages:
 quality may decrease

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 Commission
Advantages:
 Increased sales
Disadvantages:
 unpredictable sales
 aggressive approach to sales

Fringe Benefits
Advantages
 Attracts more/skilled employees
 lower employee turnover

Disadvantages:
 cost of providing benefits
 employee may not like benefit provided

Profit Sharing
Advantages
 co-workers have common goal
 increased motivation
 focus on profitability

Disadvantages
 focus on profit may decrease quality
 fluctuation in employee's earnings disrupts business

Time rate system

Advantages:
 Easy and simple:
 Time rate is easy to understand and simple to follow and calculate.
 Wage calculations are also easy and quick.
 Each worker knows how much wage payment he is entitled to at the end of the month.
 This gives convenience to employer and employees.
Disadvantages of Time Rate Systems:
 It ignores efficiency
 Loss of skilled workers
 Inefficiency
 Conflicts of thinking
 Increased supervision cost:

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Non – financial rewards and methods - Non-financial motivation is the integration of a system of reward
and recognitions which doesn't involve giving money directly to the employee. It involves various methods.
 Job rotation – increasing variety in the workplace by allowing workers to switch from one task to
another. It makes the work more interesting and prevent boredom. Workers will become multi-
skilled, which helps to create a flexible work force.
Advantages:
 Eliminates boredom
 Encourages development
 Give employees a break from strenuous job duties
Disadvantages:
 Costly and time consuming
 Employees may be disgruntled
 Not suitable for all industries

 Job enlargement –increasing or widening tasks to increase variety of workers. Workers will be
given a variety of similar level tasks to do. It reduces boredom and creates interest among
employees.
Advantages
 Learning new skills
 Reducing boredom and boosting energy
 Creates a positive and better working environment
 Chances for recognition and reward
Disadvantages
 Increases workload
 Additional skills needed
 Lack of knowledge
 Incapability

 Job enrichment –organising work so that workers would be encouraged to use their full potential.
 It was developed by Herzberg
 Workers will be organised so that they can use more of their skills and abilities
 Employees can be involved in decision making
 Workers will be considered and feel more valued
 Job enrichment increases job satisfaction, efficiency and motivation
Advantages:
 Learn new skills
 Reduce boredom
 Receive recognition
 Employee motivation
Disadvantages
 Lack of training
 Increase workload

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  Poor performance
Quality circles – group of workers who meet regularly to discuss work related problems.
 Workers come with up solutions to problems or suggest how improvements can be made.
 The results of quality circles are presented to managers and good ideas and solutions will be
introduced to the workplace.
Advantages:

 Promotion of teamwork
 Develops employee positive attitudes
 Positive working environment
 Increased quality and productivity

Disadvantages:

 If not addressed, the staff /employees not sure of the purpose

 Not enough relevant training
 Quality circles (QC) are not empowered to make decisions
 Participation not voluntary
 There is little or no management support

Team working and delegation

Team working – organising production so that groups of workers complete the whole unit of work.
 Production workers will be organised into groups or teams and will be given the responsibility for
the completing the whole task.
Advantages:
 More productive
 More productive
 More reliable
 Learn new things
Disadvantages
 Unequal participation
 No individual thinking
 Decision making takes time
Delegation – passing responsibility to perform tasks to workers lower down in the organisation.
 It involves managers passing authority for the performance of tasks to lower level workers
 It allows workers to make decisions about how the tasks can be performed.
Advantages:
 Can Take the Advantage of Specialized Skills.
 Can Improve Time Management.
 Build Trust Within the Organization
Disadvantages:
 Possible Miscommunication Conflicts.
 Effects of Lack of Commitment.
 Risk of Inferior Results.
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Organisation and management
Organisational structure –the formal, internal framework of a business that shows how it is managed and
organised. Organizational structure is a system used to define a hierarchy within an organization. It
identifies each job, its function and where it reports to within the organization.
Organisational chart - An organizational chart is a diagram that shows the structure of an organization and
the relationships and relative ranks of its parts and positions/jobs.
Functional departments – it shows the main activities of a business such as finance, marketing, operations,
human resource and research and development.
Simple organisational structures - A simple organizational structure is the default operating system used
by most small businesses, because it centralizes decision-making with the owner. Unlike other
organizational structures, the simple, or flat, structure doesn't have formal departments and layers of
management.
Features
 Hierarchy
 Chain of command
 Delegation
 Span of control
Hierarchy –the number of levels in an organisational structure.
 It describes the different levels in an organisational structure
 Production workers will be the lowest level of hierarchy and the chief executive will be the top level
 There will be more people at each level because one person may not be able to control all employees
 Narrow Span of management means a single manager or supervisor oversees few subordinates. This
gives rise to a tall organizational structure.
 A wide span of management means a single manager or supervisor oversees a large number of
subordinates.
Images of a wide span of control

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Images of a narrow span of control

Images of an organisational chart

Chain of command – the route through which authority is passed down an organisation.
 It describes the routes through which authority is passed down to these managers from the top
 Each person in the chain of command is directly responsible to the person immediately above them
and directly responsible for the person directly below them.
 Instructions and decisions can be passed down the chain of command.
 Information about performance can be passed up to the chain of command.
Delegation – passing authority down through the organisational hierarchy to a subordinate.
 Authority passes down through the chain of command
 Top level Managers delegates authority for specific tasks to the lower level managers
Span of control – it means the number of subordinates reporting to each supervisor or manager.
 It will be as narrow or wide depending on how many subordinates a person is responsible for.
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 The factors affect the size of the span of control
 The difficulty of tasks
 if the work is simple and repetitive – wide span of control
 if the work is more complex – narrow span of control
 the experience and skill of workers
 highly skilled and experienced workers – wide span of control
 less skilled and experienced workers – narrow span of control
 the size of the business
 large businesses – narrow span of control
 small businesses – wide span of control
 levels of hierarchy
 tall organisation – narrow span of control
 flat organisation – wide span of control
 management style
 greater control over the employees – narrow span of control
 less control over the employees – wide span of control
Advantages and disadvantages of wide span of control
Advantages
 less expensive as fewer managers/supervisors needed
 less supervision improves worker motivation
 faster communication and decision making
Disadvantages
 less promotion opportunities
 less control over subordinate’s work
 effective communication may be difficult
Advantages and disadvantages of narrow span of control
Advantages
 effective communication is easier
 better control over their workers and their work
 increases promotion opportunities
Disadvantages
 communication and decision making will be slower
 more expensive because more managers are needed
 more supervision may reduce worker motivation

Tall and flat organisation

Tall organisations have many levels of hierarchy. The span of control is narrow and there are opportunities
for promotion. Lines of communication are long, making the firm unresponsive to change.
 It will have many levels of hierarchy/management levels
 It will have more managers and supervisors
 There will be narrow span of control
 Long chain of command
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Flat organisation- flat organization has an organizational structure with few or no levels of middle
management between staff and executives.
 It has few levels of hierarchy/management levels
 Short chain of command
 Communication and decision making will be much quicker

De layering–it means reducing the size of the hierarchy by removing one or more levels – most often
middle management.
Advantages and disadvantages of de layering
Advantages
 Reduces costs
 Reduce the chain of command
 Quick communication and decision making
 Wider span of control
 Opportunity for delegation
 Highly motivated and skilled workers
 Senior managers can be in closer touch with employees
Disadvantages
 Work may not be completed on time due to workload
 Quality of the decision making may not be good
 Businesses may have to pay redundancy payment who lose their jobs
 Less job security
 Wider span of control may affect the effective management of subordinates

Centralised and decentralised organisation

Centralised organisation - Centralized organization can be defined as a hierarchy decision-making
structure where all decisions and processes are handled strictly at the top or the executive level.
[ all the important decision-making power is held at head office or the centre]

Features:
 Decision making power is held at the top by senior managers
 The decisions will be passed down to the lower level through the chain of command
 Pizza Hut, a franchise operates as a centralised organisational structure.

Decentralised organisation - A decentralized organization is one in which most decisions are made by
mid-level or lower-level managers, rather than being made centrally by the head of the company. It's the
opposite of a centralized organization, in which all decisions are made at the top.
[all the decision-making powers are passed down the organisation to lower levels]

Features:
 authority will be passed down to lower level
 Employees will get participation in decision making
 Employees will be motivated highly

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Advantages and disadvantages centralised and decentralised organisation

Centralised organisation

Advantages:
 Quick decision making
 Decision can be taken for the whole business
 Can use specialist staff in decision making

Disadvantages
 Slower communication
 Unable to respond quickly to changes in local markets
 It may reduce employee motivation

Decentralised organisation
Advantages:
 Decisions will be taken on the basis of local needs
 It can be used to train junior managers
 Delegation helps to improve employee motivation

Disadvantages:
 Decisions can’t be taken in the interest of the whole business
 Managers may take poor decisions due to the lack of skills and experience.

Roles, responsibilities and inter-relationships

Directors and Chief Executive Officer

Directors are appointed or elected members of the Board of Directors of a company who have the
responsibility for determining and implementing the company’s policy. Some directors may have a
management role, for example a Marketing Director.
 Directors are the most senior level of management of a limited company
 Directors may be employees of the business and be responsible for all the functions
 Directors are elected by shareholders in the Annual General Meeting [AGM].
Annual General Meeting [AGM] – a meeting for shareholders that limited companies must hold once every
year.
 Setting strategy – the long – term plans for the business
 Making sure that the resources are available to achieve objectives
 Reviewing the performance of mangers
 Protecting the interests of shareholders and other stakeholders
 Providing leadership to ensure the success of the business.
The Chief Executive Officer has overall responsibility for the day-to-day management of the business and
implementing the decisions of the Board of Directors.
Chief Executive Officer (CEO) – The most senior manager responsible for the overall performance and
success of a company.

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 Manager – an individual who is charge of a certain group of tasks, or a certain area or department of a
business. For example, Factory Manager.
 Managers are responsible for the day to day running of the related department
 Human Resource Manager is responsible for making decisions about the day to day running of the
Human Resource Department
Roles and responsibilities of the Managers
 to make sure the decisions of directors are carried out
 delegating tasks to members of their department
 taking the decisions needed to achieve departmental targets
 Motivating workers in department to work hard to achieve the department’s and the company’s
objectives.
 Solving day to day problems that may arise within the departments
Supervisors and other workers
Supervisor – an individual who checks and controls the work of subordinates.
 Supervisors are responsible for giving out tasks to the workers.
 They make sure the workers carry out their assigned tasks
 Supervisors check the quality of the work of employees
The role of management
 Setting objectives
 Motivating workers
 Making sure workers have the resources they need to complete their tasks
Role and responsibilities of directors
 Act honestly and carefully;
 Know what the company is doing
 Take care when handling other people's money
 Make sure the company can pay its debts
 Ensure that proper financial records are kept

Functions of management
 Planning - Planning is the process of thinking about the activities required to achieve a desired goal.
“It is the process of making plans for the future.”
 Organising – preparing and arranging the required resources in order to achieve the planned goals
and objectives.
 Commanding – it involves the control and supervision of subordinates. It aims to motivate workers
towards achieving the planned objectives.
 Coordinating – it makes sure all of the different departments are working together for achieving the
goals and objectives of the business
 Controlling - measuring and evaluating work of employees and verify they are on target.

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 Managers need to:
 Understand the people who work for them
 Set a good example
 Treat subordinates fairly
 Delegate tasks
 Communicate effectively
Delegation – it means giving authority to subordinates to make decisions and complete tasks. Successful
delegation requires the worker to be given enough authority, resources and co-operation to complete a task.
Benefit of delegation to managers and subordinates
 Managers will get time to focus more on complex tasks with greater importance
 It can motivate workers who are given the opportunity to take on responsibility and develop their
skills
 It develops the skills of workers and increase the flexibility of the workforce
 Quality of the work can be improved because lower level workers have better skills than their
managers for completing certain tasks
 managers can then measure the success of the employees
 work becomes more interesting for subordinates and will increases their motivation
 it makes employees feel trusted and important
However, some managers do not delegate tasks. The reasons are:
• They might be afraid the subordinates will fail and manager wants to control everything
• Manager might also feel threatened that subordinate will do a better job than them
• Delegation means that once the task is completed, the manager will have less direct control
• This means the trust for the workers is increased by the manager
• Therefore, there needs to be more trust in workers in order to reduce control over them

Leadership styles – there are the three important methods of leaderships. It includes:
 Autocratic leadership – a leadership style where the leader makes all the decisions.
Features:
 The manager expects to be in charge of the business and expects to have their orders followed with
no questions asked.
 Autocratic leader will make all the decisions without any discussion without others
 Autocratic leaders decide how the objectives can be achieved
 Monitoring closely employees when they are at work

Advantages

 It allows for fast decision making

 It improves overall communication.
 It improves productivity.
 It handles crisis situations effectively.
 It reduces employee stress.
 It counters team inexperience.

Disadvantages
 It often leads to micromanagement.
 It creates a work culture based on the leader.
 It creates a system of dependence.
 It creates a lack of trust.

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  Democratic leadership – a leadership style where workers take part in decision making.
Features:
 It is an opposite of autocratic leadership
 The manager allows the subordinates to be involved in the decision-making process
 Communication will be two way
 Leaders delegate authority to subordinates
 It motivates employees
 No close supervision

Advantages
 It encourages creativity
 It strengthens the relationship of the team
 It encourages honesty within the workplace
 It improves job satisfaction
 It increases team knowledge
 It increases stronger commitment levels

Disadvantages:
 It creates negative emotions
 It causes delay
 Delay in decision making
 No one take responsibility for failure

 Laissez-faire leadership – a leadership style where most of the decisions are left to the workers.
Features:
 Laissez faire means let them do it
 It allows workers to make decisions and carry out tasks without the involvement of leaders
 The leader will provide a coordinating and supporting role for the team members.
 It will be effective for workers who involved in creative tasks

Advantages:
 It encourages personal growth
 It encourages innovation
 It allows for faster decision making

Disadvantages:

 Low accountability
 Lack of role clarity
 Poor involvement with the group

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Comparison of the leadership styles

Autocratic Democratic Laissez-faire

Set by leader without any Set by the leader, but workers Usually set by the leader
Objectives input from workers are often consulted with or without any input
from workers
Taken by the leader Workers are encouraged to Delegated to workers
Decision making without any input from take part, but leader still takes who take the decision
workers the final decision
One-way, from leader to Communication is most
worker. No opportunity for Two-way-feedback often upwards from
communication feedback encouraged subordinates to leader.
Little feedback from
manager.
Supervision of Closely supervised by the Leader is available to solve
workers leader problems, but otherwise close No supervision by leader
supervision is not needed
Availability of Workers are given very Workers given information Workers provided with
information limited information about which allows them to fully all the information they
the business participate in the business need to take decisions
Could be high or low
Motivation levels Likely to below Likely to be high depending on the task
and skills of workers

Choosing leadership style – there are many important factors that must be considered when choosing the
style of leadership.
 The skills and experience of the workforce – more experienced and skilled labours required very less
supervision and control from managers. So that, a democratic style of leadership is the most suitable.
 The time available to make decisions – if decisions need to be taken quickly, there will be no time to
discuss the situations with workers. So that, autocratic approach is the most suitable.
 The personality of the manager – some managers are naturally autocratic or democratic. The style of
leadership will be depending on their personality factors.
 The task to be completed – the style of leadership will depend on the nature and characteristics of the
tasks to be completed.
Trade unions - A trade union is an organisation formed and financed by workers for the purpose of
protecting the interests of its members and improving their pay and working conditions.
It is an organisation of workers aimed at improving pay and working conditions and providing other
services, such as legal advice for members.
Features:
 A group of workers that join together to protect their interests
 A trade union is a pressure group
 Employees usually have the same interests (i.e. good wages, pleasant work environment, etc.)
 If an employee wants to join a trade union, they must pay a yearly subscription for the benefits

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Benefits/effects of trade unions to members
 Improved conditions of employment (such as wages, holidays, hours of work)
 Improved work environment (health & safety, heating, noise)
 Advice/support if a member has been unfairly fired, mistreated, etc.
 Greater power as collective for dealing a difficult task
 Greater power for dealing with employees [collective bargaining]
 It provides job security to employees
 Employees must pay membership to trade union
 Employees lose wages which cannot be recovered during strike actions.
Role of trade unions
 Negotiating with employers to improve pay and working conditions
 Resolving conflict
 Providing legal support and advice
 Providing services for members
Recruitment, selection and training of workers
Recruitment – it is the process of finding people to work for a company.
 Recruitment is one of the roles of the Human Resources department
 Recruiting usually happens when an employee leaves job, a business is starting up, or it wants to
expand.
 Recruiting can be time consuming and costly

Internal and external recruitment

Internal recruitment – it means filling a vacant post with someone already employed in the business.
[A Job is filling with an existing employee of the company]

Advantages of internal recruitment

 The vacancy can be filled more quickly and more cheaply
 Applicants already know how the business works
 The business already knows the strength and weakness of the applicants
 High motivation for workers when they are promoting
 It saves the time and cost of training

Disadvantages of internal recruitment

 A better candidate may have been available from outside the business
 Chances of conflict among the workers and leads to de motivation
 It does not bring any new ideas
 Job vacancy of the promoted employee may remain as vacant

External recruitment – filling a vacant post with somebody not already employed in the business. [Job is
filled by someone who is not an existing employee of the business].

Benefits of external recruitment

 External applicants may bring new ideas and this can improve efficiency of the business
 There will be wider choice of applicants with different skills and experience
 It avoids the risk of upsetting workers when someone is promoting internally

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Limitations of external recruitment
 It takes longer to fill the vacancy
 It is more expensive than internal recruitment
 It costs for advertisement and training
 Time consuming for interviewing the candidates
 External recruitment needs induction training

Differences between internal recruitment and external recruitment

Internal recruitment External recruitment

It is a quick process It is a lengthier and time-consuming process
Fill the vacancy from the existing workforce Fill the vacancy from the outside the business
Cheaper expensive
Limited choice of candidate Wider choice of candidate
It motivates the existing staff to improve their It dissatisfies the existing staff at work
performance
Selection on the basis of merit cum seniority Merit cum qualification
Cost – effective Requires large amount of investment
New ideas and talent is impossible Talented candidates with new ideas can be selected

Selection - Selection is the process of picking or choosing the right candidate, who is most suitable for a
vacant job position in an organization.
Selection is a process of identifying and hiring the applicants for filling the vacancies in an organization .
Stages in recruitment and selection
 The business identifies the need for a new worker and carries out a job analysis
 To produce a job description
 To produce Person specification
 To advertise the job
 To send out job application forms and job details
 To receive completed applications
 To select a shortlist from all of the applicants
 To conduct an interview the shortlisted candidates
 To select the right candidate
Job analysis - It is a process that identifies the content of a job in terms of the activities involved and the
skills, experience and other qualities needed to perform the work.
Advantages:
 Provides First Hand Job-Related Information
 Helps in Creating Right Job-Employee fit.
 Helps in Establishing Effective Hiring Practices
 Helps in analysing Training & Development Needs
Disadvantages
 Time Consuming
 Involves Lots of Human Efforts
 Mental Abilities Cannot be Directly Observed
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A job analysis identifies the tasks and responsibilities to be carried out by the new employee.
Job description – it is a list of the key points about a job, job title, key duties, responsibility and
accountability.
 It is a written document that provides all the details about a job
 It is usually prepared by the HRM
 It outlines the key duties and responsibilities of an employee
Advantages of a job description
1. Helps companies understand the type of candidate they should search for based on title, position and
location
2. Employees are well aware about their job roles & duties
3. Job description helps in understanding the workplace environment, benefits etc for a prospective
employee
4. Helps in better recruitment and selection
5. Job description clearly highlights all the requirements, objectives & goals that it wants an employee to
perform

Disadvantages of Job Description

1. Job descriptions are time bound and can change with organization structure, industry policies, company
requirements etc
2. It can only highlight the macro criteria of a job but cannot fully explain the obstacles, emotional
requirements etc related to the job
3. Incomplete job description lacking quality information can misguide both the HR manager as well as the
employee

Contents of a job description

 Job title
 The main duties of the post
 Responsibilities
 accountability
Person specification – a list of the qualifications, skills, experience and personal qualities looked for in a
successful applicant.
 It is a written document that is usually produced by HRM
 It shows qualifications, skills, experience and personal qualities required for an applicant.
Advantages:
1. Job specification highlights all the specific details required to perform the job at its best
2. It gives the HR managers a threshold and a framework on the basis on which they can identify the
best prospects
3. Helps in the screening of resumes and saves time when there are multiple applications by choosing
those who are closest to the job specification
4. HR managers can use job specification as a benchmark to evaluate employees and give them
required training
5. It also helps companies during performance appraisal and promotions

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Disadvantages

1. It is a time-consuming process as it has to be very thorough and complete

2. A job description is time-bound and changes with changing technology and changing knowledge &
skill requirements
3. It can only give a framework of emotional characteristics and personality traits but cannot specify the
experience or forecast complex issues is any

Part time and full-time employment

Full-time employment is employment in which a person works a minimum number of hours defined as such
by their employer.
A part-time contract is a form of employment that carries fewer hours per week than a full-time job.
Advantages of part time employees
 A business can attract well-qualified workers
 Greater flexibility
 More productive
 No need to pay higher wages, incentives and perks
 Less absenteeism

Disadvantages of part time employees

 Less trained employees
 Chances of communication problems and errors
 Might be less committed to the company
 May offer poor quality products and services

Advantages of full-time employees

 More productivity
 Available to work over time for meeting the higher demand
 Provide high quality goods and services
 Easy to recruit the people those who wish to get job security
 Better returns from training

Disadvantages of part time employees

 Very expensive to maintain employees for longer time
 Needs to pay all incentives and benefits
 Less flexibility
 Needs to pay even if there is no productivity
 Higher training cost and there is no guarantee that the employee may stay with the company

Training - Training means learning to do something. It includes practicing skills. The term is used
for learning to do jobs.

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The importance of training
 To improve the employee’s motivation and morale
 To make the employees efficient
 To increase the productivity
 To improve the quality of business decisions and reduces the risks of mistakes
 To helps to improve the skills and abilities of employees
 It improves the confidence of the employees
 It reduces the absenteeism and employee’s turnover
 Health and safety training help to reduce accidents
 A well-trained workforce improves a business’s competitiveness

Methods of training – there are three main methods of training. It includes:

 Induction training
 On-the-job
 Off-the-job

1. Induction training – a training programme to help new recruits become familiar with their workplace,
the people they work with and the procedures they need to follow.

Induction training introduces the new worker to:

 To introduce their colleagues
 The organisation structure and their role and responsibilities within the structure.
 The health and safety procedures in the workplace
 The facilities available to workers, for example canteen facilities.

Advantages
 Workers feel they became a part of the business
 Workers who have settled likely to perform their tasks effectively.

Disadvantages
 It increases business costs
 Workers may not be adding to output during training
 Workers will be receiving wage or salaries while not doing work
 Time consuming

On-the-job training – training at the place of work. Watching or following an experienced worker.
 It involves the worker learning the skills they need to complete tasks in the workplace.
 The new workers will often sit with an experienced worker and watch how they perform the task
 The new worker will complete the work under the guidance of the experienced worker.

Advantages
 It is relatively cheap
 Workers learn the way that the business wants the job done
 Workers are producing output while training
 Workers no need to send away for training

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Disadvantages
 Workers might pick up bad habits of other workers
 Workers may not learn the most up-to-date methods
 Workers may make mistakes while learning and this increases waste
 It slows down the production of the experienced workers

Off-the-job training –training that takes place away from the workplace, for example at college, university
or specialist training centres.
 It takes place away from the work place
 It happens at college or any specialised training centres
 It helps to develop specific management skills and technical skills

Advantages
 Workers can learn the latest methods and techniques
 It does not disrupt the production of other workers

Disadvantages
 It can be expensive
 The worker does not produce any output during training

Reasons for reducing the size of the workforce

 Resignation - Termination of employment by the employee, perhaps because they have found a job
with a different employer.
 Retirement - termination of employment due to the employee reaching an age beyond which they do
not need to work.
 Dismissal - termination by the employer because the employee has broken company rules or is not
performing work to the required standard. [poor conduct or incompetence]
 Redundancy – termination of employment by the employer because the job is no longer needed.
[When a business no longer needs an employee even though the employee did nothing wrong]
 Automation [robots replacing human jobs]
 Less demand
 Relocation of a business

Reasons for redundancy

 Introduction of new technology
 The job you were hired to do no longer exists.
 To cut costs
 To close down or moving a business
 When a business is being taken over or merged with another business

Legal controls over employment issues

 There are many laws in countries that ensure that everyone has equal employment opportunities
regardless of race, gender, religion, age etc.
 Companies must treat all applicants for the job equally.
 The governments of most countries have passed laws aimed at protecting workers from being
exploited by employers and dismissed unfairly.

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  Employees of a business have legal right that must be protected, which includes:

1. To prepare contract of employment

2. Unfair discrimination at work
3. Unfair dismissal
4. Wage protection
5. Health and safety

Communication – It means exchanging or sharing ideas, facts or information between people.

Importance of communication
 It ensures that all parts of the business operations run smoothly
 It is essential to give instructions to subordinates
 It helps the employees to carry out the work efficiently
 It is important to perform the basic functions of management
 Communication helps managers to perform their jobs and responsibilities.
 It plays a vital role in human life.

Internal Communication – communication between employees of the same business.

External Communication – communication between the business and other businesses and individuals.
External communication must be efficient because it establishes the image and the efficiency of
a business.

Communication media – the methods used to communicate a message. For example, letters, faxes, video
conferencing, face-to-face conversations, TV, radio etc.

Effective communication and its importance to business

Effective communication means information passed between two or more people or groups, with feedback
to confirm that the message has been received and understood.

Effective communication involves:

1. The transmitter/sender sending a message to pass on information
2. A medium of communication – the method for sending message (i.e. e-mail, phone, etc)
3. The message being sent to the receiver
4. The receiver confirming that the message has been received and responds to it (feedback)

 Message can be sent using the correct communication media

 The message can be sent to the right person
 The receiver can understand the message
 The receiver provides feedback to the sender on time.

Benefits of effective communication

 Reduces the risk of mistakes
 Enables faster communication and decision making
 Improves co-ordination between departments
 Improving morale and motivation of the workforce
 Improving customer relationships

Methods of communication – There are four important methods of communication. It includes:

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1.Verbal [Oral] methods of communication – ‘Communications using speech’. It is the most direct and
very important part of personal communications. Sender speaks to the receiver (i.e. meetings, telephone, and
video conference).

Advantages
• It can develop into a discussion so that any points not understood can be clarified.
• It gives immediate impact and feedback.
• Facial expressions, actions, body language and tone of voice also can be used in verbal communication.
• It can be interactive so that it would be effective and successful.
 Personal contact between sender and receiver
Disadvantages
• It may take long time to communicate with many people
• There is no written record
• Cannot see the facial expressions/body language while using a telephone for talking
• Chances for misunderstanding and distorting the message
 Receiver may not listen properly
 Receiver may not hear the message properly due to noise

2. Written communication - communications in writing. It can be hand written, typed, printed or

electronically generated.

Advantages
• It allows time for planning a response
• It can be supplemented by visual or numerical data
• Identical copies of the communication can be sent to several people
• There is less chance of misunderstanding between the writer and the recipient
• It is a formal method of communication
 The message cannot be changed
 Can be sent to many receivers
 It provides a permanent record

Disadvantages
• It consumes time to prepare
• Instant feedback and response is not usually possible
• It is more formal hence lacks in familiarity
• It may be badly written – poor use of language, too wordy, many mistakes
• It may not be read in full or understand
• It may be costly to produce
• It may be difficult to explain complex points
 No personal contact
 Slow feedback

The various forms of written communication

 Letters
 Memorandum
 Agenda
 Minutes of meeting
 Job descriptions
 Purchase order
 Invoice
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  Company magazine

3. Electronic methods of communication - communicate with others by using electronic media.

Advantages
 Very quick
 E mail communication provides permanent record
 Can be sent to many people
 It can be made as more interesting

Disadvantages
 No internet access and equipment to everyone
 Equipment and software can be expensive
 No personal contact
 No confidentiality

Forms of electronic methods of communication

 Telephone or cell phone
 Voice mail
 Pagers
 Fax machines
 The internet
 Tele conferencing and video conferencing
 Website

4.Visual communication - these are the forms of communication that may be seen and which may be used
to add to the impact of written or verbal communication – to get the message across. Communication in the
forms of video, posters and charts.

Advantages
• It allows colour to be used to add variety
• It enables comparisons to be made
• It creates interest if presented well
• It enables information to be seen at a glance
• It backs up written or verbal communication

Disadvantages
• It may be time consuming to prepare
• It may become out of date quickly
• It may not be understood by some of the people it is aimed at.
• It does not give immediate feedback
• It may mislead if too small or the wrong scale has been used

Examples of visual communication

• Charts and tables
• Videos and DVDs
• Photographs
• Maps
• Flowcharts
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• Posters
• Diagrams

Choosing the best method of communication

 According to the urgency of the message – face to face or telephone call is better than a letter or any
other type of message.
 The length and complexity of the message – written communication is the best for long or complex
messages.
 How many people need to receive the message – email is suitable for the lengthy messages
 As per the distance between the sender and the receiver –email, text, phone call or letter.
 The cost of the media – letters are very expensive due to postage charge. Email, text messages and
telephone calls and internet are very cheap.
 Records of the communication – letters, text message, mails etc. will have permanent record.
 Confidentiality of the message – letter is more confidential.

Communication media – advantages and disadvantages

Letter, email, text messaging

Advantages:
 Written record
 Confidential
Disadvantages
 Postage costs
 May not be read and confidential

Telephone:
Advantages:
 Can discuss the message
 Quick
Disadvantages:
 Cost
 Not face to face

Meeting
Advantages:
 Everyone gets the same message
 Quick
 Discussion is possible
Disadvantages:
 Time consuming
 No written record if minutes are not taken
 costly
Interview
Advantages
 Confidential
 Possible for discussion and feedback
Disadvantages
 Time consuming

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  No written record if minutes are not taken

Video conferencing
Advantages:
 Reduces travel cost
 Less time consuming as no need to travel
Disadvantages:
 Cost of equipment
 Technical errors and network problems

Communication barriers
 Problems with the channel of communication
 Problems between senders and receivers
 Problems with the physical environment

How the communication barriers can be reduced/removed

 Use the easiest language which can understand the sender and receiver
 Use shortest and quickest channel
 keep the message as much as short
 Ask for feedback from the receiver
 Use the most suitable medium for communication
 Reduce physical barriers such as noise, errors etc
 Reduce technical errors

How the communication problems may affect a business

 Tasks may not be completed

 The reputation of the business may be damaged
 The level of employee morale and motivation falls
 Higher risk of accidents in the workplace
 Poor sales
 Recruitment and selection problems

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