Lecturers Guide Entrepreneurship and Business Management N 5

Lecturer’s Guide: Entrepreneurship and Business Management N 5 This Lecturer’s Guide accompanies the following Student’s Book: Title: Entrepreneurship & Business Management N 5 Author: BB Brown ISBN: 978 -1 -4308 -0066 -8 Web PDF ISBN: 978 -1 -4308 -0227 -3 Copyright © BB Brown, 2012

Module 1 overview When you have completed this module, you should be able to address the following: l Unit 1. 1: Define the term ‘management’. l Unit 1. 2: Describe four types of organisational resources. l Unit 1. 3: Explain why managers are important to companies by referring to their tasks. l Unit 1. 4: Describe the different skills needed by a manager and indicate why a combination of these skills are necessary. l Unit 1. 5: Describe the different characteristics of managers. l Unit 1. 6: Discuss the primary responsibilities of different levels of managers. l Unit 1. 7: Describe the functional responsibilities of a manager. l Unit 1. 8: Explain the concept management environment. l Unit 1. 9: Describe the internal environments and stakeholders that impact on management and why a manager has to be aware of these environments. l Unit 1. 10: Describe the external environments and demonstrate why it is important for a manager to be aware of these environments.

Activity 1. 1 Human resource (HR) – Employee sister ; employee friend ; sales person Financial resources (FR) – Money Physical resources (PR) – Tools ; wood and metal off-cuts Technology resources (TR) - None Intellectual resources (IR) - Woodwork and metalwork matric

Activity 1. 2 Identify and observe or talk with college manager Create task list of manager’s job Identify tasks NOT covered by manager from textbook list: l l l l Select, appoint, train, and supervise the work of, human resources Arrange and control the money that flows into and out from the business Identify suppliers and order, receive, check and store materials and tools for use in the business Arrange and control the way materials and tools are used in the business Identify, order and maintain the physical resources used in the business Administer and control the sale and delivery of products to customers Administer the financial and other records of the business State why manager is not required to complete these tasks

Activity 1. 2 Marking schedule Q: Content: 2 Observed manager diligently 1 -5 Had prepared sound questions for manager 1 - 10 Made notes of manager’s tasks 1 -5 Created a comprehensive task list 1 - 10 4 Identified ALL tasks that chosen manager was not required at address 1 -5 5 Gave reasonable explanation why manager not required to do certain tasks 1 -5 3 Maximum marks possible Marks: 40

Activity 1. 3 The different skills that Vuma needed are as follows: l To start the business = Human and Technical skills l To manage the growing business = Human , Technical and Conceptual skills Reasons for the above choices: l Starting a manufacturing business requires an entrepreneur to be able to choose the right employees and motivate those employees to do a good job; and the entrepreneur must have a sound knowledge of the products produced by the business and how those products are made .

Activity 1. 4 Vuma would show the following characteristics: l l l l Honesty and transparency in dealing with customers, suppliers and employees Respect for employees based on their ability to do a good job, irrespective of their backgrounds Willingness to listen and respond to employees, in particular about ideas to improve productivity and concerns about the working environment Fairness in all dealings with employees and an ability to stick with sound decisions in all matters Willingness to operate ethically and within the laws of the country, which are particularly important in dealings with suppliers and customers Willingness to give technical advice and guidance to employees to help them to do a good job Willingness to admit to not knowing an answer but to commit to finding that answer as quickly as possible, when employees raise difficult questions Willingness to admit to mistakes and to correct them as quickly as possible, when dealing with all stakeholders

Activity 1. 5 Create an Organogram to define the organisational structure of the college. Students should address the factors listed in the schedule below: Q: Content: 2 Students diligently researched the management structure of the college 1 -5 3 Students created a reasonably accurate organogram for the college from the research data obtained 1 -5 4 Students listed ALL managerial positions in terms of the levels (top, middle, lower) within the organisation 1 -5 Maximum marks possible Marks: 15

Activity 1. 6 Identify a top SA hotel of choice Necessary operations for an hotel: l Greeting and registering customers l Providing accommodation to meet customers’ needs l Providing food and other support (laundry etc. ) for customers l Cleaning and maintaining all parts of the hotel l Financial control of hotel business l Marketing hotel to attract customers Functions probably fall into following categories: l Customer service l Housekeeping l Catering l Finance l Marketing l Maintenance

Activity 1. 7 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) formal and informal characteristics stakeholders culture autocratic threats brand image motivating status quo formal grape vine

Activity 1. 8 National event chosen and explained External factors identified in terms of: Economic ; political ; social ; cultural ; environmental ; technological ; international Impact on SMME will depend on event chosen but should fully explain influences associated with above factors

Activity 1. 9 1. 2. Student must choose ONE of the external factors that impact on the personal entrepreneurial business plans (economic; political; social; cultural; environmental; technological; international), then explain how that factor influences the business plan Student must provide full detailed information to be included in the business plan to demonstrate the important of the chosen external environment on the business. Examples must be provided to reinforce the message.

Module 1: Final summative assessment 1. 2. 3. 4. 5. 6. 7. 8. formal and informal characteristics stakeholders culture status quo formal lunch arrangements culture the environment

Module 2 overview When you have completed this module, you should be able to: l Unit 2. 1: Explain the concepts ‘personal management’ and ‘selfmanagement’, and explain the differences between personal management and leadership. l Unit 2. 2: Describe the seven habits of effective selfmanagement. l Unit 2. 3: Explain personal planning and the roles involved, and describe an effective planning system. l Unit 2. 4: Describe workforce motivation and the importance of motivation, and give examples of how to motivate workers. l Unit 2. 5: Explain ‘teamwork’ and the importance of teambuilding exercises, and recognise the importance of group dynamics in a business.

Activity 2. 1 Answers to this question will be personal but must include references to the following: l Personal finance: Long-term financial goals in terms of the major assets, savings, and social activities l Education: Short-term education qualifications and long-term education plans in terms of further qualification l Career planning: Achievement levels for the next 15 years using five-year mileposts l Time management: How time available is managed to focus on achieving the above goals, using the daily segments of morning, afternoon, and evening

Activity 2. 2 l l Decide, create and write down the following in own words: Personal mission statement defining personal five year image objective or in terms of position achieved Personal long-term objectives to achieve mission Goals for coming year to achieve stated steps towards the mission Targets to achieve your goals by certain times during the year

Activity 2. 3 Which of the OK situations applies to each of the following statements: 1. "I really appreciate your idea and I can see that if I include the change you suggest it will make it easier for everyone and take less time. That is what we will do. “ I’M OK - YOU’RE OK 2. "Don't shout at me. I know this will not work but that's what I've been told. If you won't do it then you are sacked. Get your things and get out!“ I’M NOT OK – YOU’RE NOT OK 3. "This really needs to be done to resolve the problem but as you don't like this type of task I will have to let it go. “ YOUR’E NOT OK – I’M NOT OK 4. "Let me summarise. You have agreed to change the working system provided I pay double wages for working on the weekend. Okay, let's go with that. “ YOU’RE OK – I’M NOT OK (but could also be YOU’RE OK – I’M OK if the manager is comfortable paying double wages) 5. "I don't care if you are not feeling well, get your lazy backside off that bench and get that job done, now!“ YOUR’E NOT OK – I’M NOT OK

Activity 2. 4 This is a class communication activity to illustrate the need to listen carefully and communicate clearly

Activity 2. 5 This is very much a personal activity requiring personal answers

Activity 2. 6 Student answers to this activity will be personal

Activity 2. 7 The answers to this activity will be personal to each student but should include: l Tasks highlighted in Activity 2. 6 l References to known schedule of lectures l References to known college activities l Some references for personal activities

Activity 2. 8 An agenda for this meeting should include the following: l To receive a report and data from the Human Resources Director about the extent of absenteeism in the company l To discuss the different ways in which managers deal with absenteeism in their departments (brief report from each manager ) l To discuss possible causes of absenteeism (working conditions; transport availability ; etc. ) l To propose and agree actions to be written into a proposed new company policy for discussion with employee representatives

Activity 2. 9 Vuma would need to implement the following: l Talk with Gawie in private l Explain that toys made by him are being returned, showing Gawie an example l Ask Gawie for his input about why he is producing faulty toys l If the problem related to faulty tools, agree to address that problem immediately l If the problem results from a lack of understanding, explain the process to help Gawie improve his work (developmental feedback) l If the problem is due to lack of skills, agree with Gawie that undertakes further skills training to improve his work l Monitor future work to ensure the required improvement l Provide motivational feedback (pat on the back) for each work improvement until the required standard is achieved

Activity 2. 11 Team roles as follows: l Gawie is acting as an Avoider by ignoring the meeting l Eilee might by acting as an Encourager by trying to reduce stress and anger through jokes, but might be acting as a Clown to diminish importance of meeting l Simenya could be trying to act as a Leader to make things happen but is more likely to be acting as an Autocrat or Aggressor l Winston is acting as a Show-off and possibly as an Aggressor . If he has idea to share with the meeting he might be persuaded to act as an Ideas person Group dynamics in the first meeting suggest the following: l Original employees are at Stage 1 Forming though also rapidly moving to Stage 3 Resolving , without going through Stage 2 because they have worked together for some time already l Individuals identified in Q 1 above are at Stage 2 Storming , reinforced by their actions indicated in Q 1 above l This suggests that group dynamics reflect the team being split into two groups , or that overall the whole team has not yet proceeded beyond Stage 2 Storming/Confrontation Vuma must guide the team through Stages 1 -3 by including everyone in discussion , deliberately drawing in each individual to share ideas , respecting individual needs , constantly reinforcing the company objectives , and mediating between employees to resolve personal differences

Module 2: Final summative assessment (1 of 3) 1. Personal management is about controlling one’s personal behaviour to achieve the best personal outcomes . Leadership is about getting the best performance from others . 2. Managers and entrepreneurs should listen to others to get as much information as possible from people, including employees , who have experience in the particular field of interest. 3. THREE factors that can motivate an entrepreneur personally can be chosen from the following: l Independence – not having to answer to someone else l Working in own time rather that confined to set business hours l Ability to keep all the money that he or she earns l Ability to grow something for the future to hand on to children l A way to invest available money to get a better return 4. A diary helps an entrepreneur to manage his or her time by: l Recording tasks in an order of priority according to date required l Ensuring that tasks are not missed l Enabling owner to allocate enough time for each task without impact on other tasks l Identifying times available for other work

Module 2: Final summative assessment (2 of 3) 5. An agenda is a memorandum or list of actions to be addressed at a meeting . TWO items that need to be included in an agenda can be chosen from the following: Date, starting time and place for the meeting l Issues to be discussed l Reports to be provided by delegates to the meeting l Reports provided with the agenda to be read by participants l Proposals to be considered and voted on l Indication of timing for each item 6. You would use motivational feedback when work is good and you want to maintain that high standard. You would use developmental feedback when you want to improve the quality of the work and the individual. l

Module 2: Final summative assessment (3 of 3) 7. TWO ways in which a manager or entrepreneur can create and maintain trust can be chosen from the following: l Listening to subordinates l Keeping to promises l Promising only what he or she can deliver l Supporting subordinates when they are right l Apologising when wrong or when he or she makes a mistake 8. FOUR roles that emerge in team dynamics can be chosen from the following: l Encourager: motivates others and tries to move things along by confronting problems and suggesting ideas. l Compromiser: keeps harmony in the team and tries to resolve conflict. l Leader: Directs the steps the team must take to keep the project on track. l Summariser: summarises the team’s discussion and conclusions and repeats the team’s objectives. l Ideas person: introduces new ideas and new ways of solving problems. l Evaluator: makes sure the team does not get carried away by an idea that might not work. l Recorder: Keeps the group focused and organised ands keeps records.

Module 3 overview When you have completed this module, you should be able to: l Unit 3. 1: Define and explain the concepts ‘ethics’ and ‘social responsibilities’. l Unit 3. 2: Describe the different levels of ethical standards and the benefits of moral management. l Unit 3. 3: Describe tests for judging ethical behaviour, and how to implement and maintain ethical principles in business. l Unit 3. 4: Explain the three approaches to social responsibilities. l Unit 3. 5: Explain a business’s social responsibility to the environment, employees, customers and the community.

Activity 3. 1 l l Price-fixing is unethical and illegal and Pioneer Foods clearly failed to address ethical standards by engaging in price fixing Pioneer foods also failed any test of social responsibility because price-fixing increases prices generally and especially for poorer members of the population

Activity 3. 2 1. 2. 3. 4. 5. 6. 7. Business ethics are imposed by government laws and internal policies Every business must comply with the laws of the country in which it operates Every South African business must comply with the Constitution of South Africa A Code of Ethics can include standards of behaviour in business processes In UK, the News of the World newspaper was closed down as a result of employees' unethical behaviour Implementing ethical behaviour in the workplace requires employees' commitment to ethical behaviour The chase for higher profits has reduced a moral stance from the owner or boss

Activity 3. 3 A code of ethics for behaviour in the classroom and during exams could include reference to the following: l Arriving in good time for all activities l Attention to and respect for lecturers and other staff l Respect, at all times, for every student l Avoiding disrupting anyone’s concentration or work, especially during examinations l Respecting, and not removing, anyone else’s possessions, textbooks or work l Not showing aggression to anyone l Not cheating by copying someone else’s work

Activity 3. 4 The owners would need to consider the following: l Profit Centred approach – would giving away such a large amount of paint mean that they might not make a profit to keep the business going? l Investment Earned approach – would the investor accept losing his 2% on paint given free, or would the owners still have to pay the investor his expected return? l Environmental responsibility – how would the owners ensure that any left-over paint was properly disposed of? l What social responsibility benefit would there be to the business? Should the business also provide an advertising board to show it had provided the paint?

Activity 3. 5 Responsibilities are as follows: l Environment: (6) Paint dumping ; (8) Turning off geyser l Employees (2) Extra training ; (7) Career day l Customers (4) Delivery promise l Community: (1) Work experience ; (3) Paint donation ; (5) Old toys ; (7) Career day l Law: (9) Safe materials

Module 3: Final summative assessment Pick ‘n Pay are being socially responsible by: l Giving disadvantaged children experiences and education they would not have had otherwise l Teaching children about care for the environment l Introducing children to the concept of social responsibility Q: Factors that should be included in answers: Potential marks: 1 Student identified the issues shown above (student terminology might be different) – award 1 -5 marks for the validity of each answer 15 2 Student wrote a comprehensive, valid and appropriate Code of Ethics for the new business venture - award 1 -20 marks for quality of work 20 2 Student included the required elements – Environment, Employees, Customers, Community – in the written Code of Ethics - award 1 -5 marks for each 20

Module 4 overview l l l When you have completed this module, you should be able to: Unit 4. 1: Describe a mission statement and objectives as components of planning. Unit 4. 2: Understand how planning takes place in the finance, marketing, production and personnel functions. Unit 4. 3: Explain the concept of managerial decision making, describing different types of decisions, decision styles and personal influences on decision styles. Unit 4. 4: Name and explain the seven steps in the decisionmaking process. Unit 4. 5: Understand the different decision-making techniques and apply them in practical situations.

Activity 4. 1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. A blueprint is a template to guide actions A Vision is the dream of the owners A Mission statement cascades down to objectives Long-term objectives cover a period of up to five years A Mission statement should be exciting and inspiring All objectives should be written to be SMART The A in SMART means achievable The T in SMART means time specific SMART criteria provide descriptions that are comprehensive Managers with limited resources must know how to prioritise resources

Activity 4. 2 To plan the move to new premises: Finance department would need to assess: l New workshop costs in relation to the known income from the business l Costs of moving to the new workshop l Costs of the loss of production and business during the move Production department would need to assess: l Suitability of the space in the new workshop l Availability of resources such as electricity points, etc. l Layout of the machinery etc. in the new space l Access for vehicles delivering materials Marketing department would need to assess: l Convenience, parking and safety in respect of customers visiting the workshop l Access for vehicles collecting products for delivery to customers Personnel department would need to assess: l How employees might be asked to work during the move l Convenience for transport for employees travelling to the new location

Activity 4. 4 Q: Factors that should be included in answers: 1 Student demonstrated that he or she has produced a Mission Statement for the new venture business - Award 1 -5 marks for quality and validity of work The Mission Statement meets the requirements stated in Module 4. 1 - Award 1 -5 marks for quality and validity of work The Mission Statement produced by the student is exciting, inspiring, memorable, etc. - Award 1 -5 marks for quality and validity of work 2 3 Student demonstrated that he or she has reviewed previous long-term objectives or has produced new long-term objectives for the new venture business - Award 1 -5 marks for quality and validity of work Long-term objectives meet the SMART criteria (Specific; Measurable; Achievable; Relevant to available resources; Time related) - Award 1 -10 marks for quality and validity of work Student produced at least TWO long-term objectives for each of Finance, Production, Marketing and Personnel functions – Award 1 -5 marks for the quality and validity of the objectives for each function Potential marks: 5 5 10 20

Activity 4. 5 (1 of 2) 1. (a) Since Vuma has issued no disciplinary policy, the issue is decentralised and can be handled by a branch manager . The manager might want to involve a participatory style to try to understand why the employee is late and to support giving another chance . The manager should advise Head Office of the situation so that a centralised policy can be issued to deal with future situations . (b) This is probably a decentralised style of decision to be made for the branch concerned . Vuma might involve some employees in participative decision-making related to safety issues for a party in the workplace, etc. (c) Unless the supplier is one indicated by Head Office, the decision would be decentralised and dealt with by the manager responsible for ordering the machine (d) This is a centralised decision because it impacts on the whole group ; if a manager agrees to Union demands the effect would spread to other branches . Therefore Vuma would have to be involved in the decision . (e) This is definitely a decentralise decision taken by the branch finance manager who must act to get payment of the account

Activity 4. 5 (2 of 2) 2. The Admin Manager acted in an ego-defensive way because she is trying to defend placing the order without asking any questions The Personnel Manager is acting is an over-cautious way to keep the peace rather than to address the issues The Production Manager acted in an impulsive way by not checking if there were changes to an up-to-date machine Vuma is acting intelligently by suggested that it would have been better for managers to have met and discussed what was a large purchase for the business and what would be the best model to meet the business's requirements . This is rational decision-making .

Activity 4. 6 1. 2. 3. 4. 5. 6. Vuma has a problem that has developed over time but has reached a critical situation that needs an instant solution. Vuma's problem is that toys are not being produced to meet customer deliveries. The criteria that Vuma might want to apply to resolving the problem are: Customer order analysis ; Production output analysis ; Production resources analysis. THREE alternatives that might provide solutions to the problem are: Improve production supervision ; Organise a production schedule to coordinate products produced with products ordered ; Increase delivery options Evidence to support 4 above: Supervision allows poor time keeping and poor tools maintenance. Production schedule does not appear to specify what needs to be produced. There is only one bakkie for deliveries. Vuma really needs to address all the potential solutions but the most important to start is the lack of supervision and poor tool maintenance because nothing can be achieved without efficient production resources. Vuma will have to follow up with increased supervision of employees and maintenance processes ; with coordinating schedules ; and with organising effective delivery processes.

Activity 4. 7 Factors for a hair-dressing salon could include: l Working area of appropriate size l Clean attractive frontage l Large windows to give light for working l Tiled floor l Small kitchen area l Area for display of hair products l Easy access to water supply for hair washing basins l Easy access to electricity points for hair dryers and lights l Situated in safe area l Good car parking for customers with minimum 2 hour parking restriction l Affordable rent within business’s budget l Access to transport for employees

Activity 4. 8 Brainstorming to produce a Pros & Cons analysis: l Brainstorming can produce many, many references, none of which should be discounted l The stated and implied Pros that could come out are: Better quality equipment; Opportunity to improve the image of the business; l The stated and implied Cons that could come out are: Duplicates what we already have; Optional equipment very expensive; Will take money out of the business cash-flow; l Final decision will depend on student’s point of view

Activity 4. 9 Lack of storage Poor training Products not easily available Hairdressers too chatty CUSTOMERS IN SALON TOO LONG Assistants take too long Customers allowed to be late Poor training

Activity 4. 10 1. 2. 3. 4. 5. 6. 7. The process for developing and prioritising alternatives is called weighting The reverse method of decision making involves an analysis of Pros and Cons When brainstorming, it is important to write down everything, including jokes and asides Assumptions must always be stated clearly The “Why” techniques involves the use of a fish bone diagram When you apply the suspended judgement technique, group members must make notes and think about what is being said Fractioning means breaking down into small sections

Module 4: Final summative assessment 1. l l l 2. l l 3. 4. 5. Two new long-term SMART objectives could be taken from the following: To develop solar power technology for our products within three months To include solar power technology in at least twenty per cent of products by the year end To change our marketing approach, by the year end, to focus on environmental management The decision will impact on departments as follows: Finance may have to find the money for research , new equipment and changes to marketing brochures, etc. Marketing will have to change its publications to include the new strategy and may have to train sales representatives in the new technology Production will have to decide what new equipment is needed for the new technology and how to change production flows to include the new techniques ; it may also have to re-train some employees Personnel will have to update some employee specifications to include solar technology experience and will almost certainly have to arrange training programmes to update existing employees To change a business policy would require a centralised style of decision-making though it is always good to allow participation of as many people as possible to keep employees and unions on board When discussion outsourcing, the Pros & Cons Analysis technique would be used because it enables the company to identify advantages and disadvantages. To identify new customers for its solar-power products, the company would probably employ Brainstorming because that technique comes up with as many different options as possible.

Module 5 overview When you have completed this module, you should be able to: l Unit 5. 1: Define the word ‘organising’, explain how work is divided into jobs, and explain the differences between job generalisation and job specification. l Unit 5. 2: Explain why an organisation structure is formed, describe the types of organisation structure, and describe the types of departmentalisation. l Unit 5. 3: Explain the word ‘delegating’, the authority and power involved in delegating, the delegation process, and how to create the right delegating environment.

Activity 5. 1 Factors that should be included in answers: Student identified and clearly stated the job in the business Student provided details of tasks required in that job Student demonstrated whether the job required a specific or generalised approach Student gave reasons to support the approach decision Potential marks: 1 -2 1 -5 1 -2 1– 5

Activity 5. 2 Q: Factors that should be included in answers: Potential marks: Student designed an appropriate structure for the type of business in mind 1 -10 1 Student explain if structure is hierarchical or project based Student gave a valid reason for the choice 1 -2 1 -5 2 Student explained whether or not the structure is flat Student gave valid explanation (e. g. by taking out management layers, etc. ) 1 -3 1 -5 3 Student explained the type of departmentalisation chosen Student gave valid explanation why this type would work in his or her business 1 -5 1 -10

Activity 5. 3 1. 2. 3. 4. 5. 6. 7. Sibongile has personal power which might also be referent power because it is power based on proven ability . Mark has position power because he has the power to discipline . Sandra has subordinate power and may also have referent power because she is respected by all levels of employee . Dave has personal referent power because other colleagues listen to him and trust him . Mark has position power through the power to reward . Andrew has position power which might also be coercive power if he uses his power to make employees do things . Charity has subordinate power because the boss listens to her even though she is a subordinate .

Activity 5. 4 The stages for delegation would be as follows: Stage 1: Explain how the photocopier works and get assistant to photocopy documents under your supervision Stage 2: Allow assistant to photocopy document without supervision but check they have been done correctly Stage 3: Explain how different documents have to be sorted into groups and show what makes up different groups Stage 4: Allow assistant to sort into groups under your supervision Stage 5: Allow assistant to complete whole job – photocopying and sorting – without supervision

Activity 5. 5 Issues that Vuma would need to address are as follows: l You cannot delegate to an individual who does not have the appropriate skills (Mike might need training in how to deal with people ) l You have to supervise delegation at the beginning , which can sometimes take more time that doing the job yourself . In the beginning it is not a time-saving option l First stage of delegation is always to explain what is required and supervise the first attempt to do the task l Only when you can see that a person is capable of completing the delegated task can you leave them to do the job

Module 5: Final summative assessment 1. 2. 3. 4. 5. 6. 7. A general job description just states an outline of the job with no specific skill details , such as “Gardner to maintain small garden” . A specific job description includes skills , such as “Vehicle mechanic used to working on heavy goods vehicles” . A flatter organisation structure means that there are fewer management layers which enables decisions to be made more quickly . Benefits of a project structure (choose TWO ) are that it enables the business to move employees into groups to do the best job; there are fewer management layers so that decisions get made more quickly; employees gain more skills by working on different projects; it is a more motivating environment for employees Having authority in a business means having the power to get things done . Subordinate power is a good thing for a business when it is used to support better performance ; it is a bad thing when it is used to undermine good management . Delegation is about training and motivating subordinates by giving subordinates the opportunity to learn new skills . Things a manager can do (choose FOUR ) to make sure that a delegated task is done correctly are: Choose a capable person; Get the person’s agreement to accept delegation; Provide training when required; Always explain the processes for the job fully; Always delegate in small stages so that subordinate can handle each stage before going to the next; Always supervise each new stage until subordinate is competent

Module 6 overview When you have completed this module, you should be able to: l Unit 6. 1: Explain the concept ‘staffing’ and the importance of human resource planning in a business, and describe the tools and procedures used to recruit employees. l Unit 6. 2: Explain the concept ‘job design’, the factors that need to be taken into account when designing a job, and how to enlarge and enrich a job. l Unit 6. 3: Describe all the components of a job description and its importance in a business. l Unit 6. 4: Explain the importance of training and developing employees, and understand different types of training and development programmes. l Unit 6. 5: Describe the importance of performance appraisals, the performance appraisal process, and the positive and negative aspects of a performance appraisal. l Unit 6. 6: Explain the importance of fair remuneration, and describe the elements of a remuneration package. l Unit 6. 7: Describe the concept ‘labour relations’ and the role of trade unions, bargaining councils and labour legislation.

Activity 6. 1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Taking minutes would be in the job description Controlling the filing system is job description Five years’ experience in a secretarial role would be part of the job specification Treating guests with respect would be in the job description . Good interpersonal skills would be required in the job specification Arranging travel for the General Manager would be part of the job description Able to work well in a team could be in the job description and job specification Scheduling the diary of the General Manager would be part of the job description Able to work flexible hours would be in the job specification Communication and telephone skills would be part of the job specification

Activity 6. 2 1. 2. 3. – – – 4. – – No. The advert does not give enough information about the job or about the experience desired by the employer The advertisement should give details of types of music and ask for years of experience TWO (choose) additional activities could be: Take and deal with telephone calls from listeners Arrange and introduce guests to the programme Deal with emails and text messages from listeners THREE (choose) additional characteristics could be: Ability to design music programmes to suit different listener tastes Ability to talk with listeners about music in relation to current music activities in the area Willingness to work unusual hours Ability to get to the studio on time

Activity 6. 3 Factor: What is required: Job description from Activity 5. 1 Student access information from the previous job description 1 -5 Jon Specification Student developed a job specification for the above description to include: • skills required • previous experience • personal characteristics 1 -5 1 -5 Student developed an interview questionnaire of at least 10 questions to obtain information as follows: • skills required • previous experience • personal characteristics 1 -5 1 -5 Interview questionnaire Potential marks:

Activity 6. 4 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. job description (b) advertisement (d) must-have characteristics (c) use an interview questionnaire (d) personal characteristics (a) in a quiet place (b) relevant top managers (d) health and fitness are critical to the job (c) induction training (d) the employee’s employment contract (c)

Activity 6. 5 1. l l 2. 3. l l l Making tea involves: Getting together materials such as mugs, kettle, water, teabags, milk and sugar Boiling the kettle and pouring hot water Pouring tea into mugs and adding milk and sugar Delivering to employee locations When materials are stored in a different location, productivity is lost or reduced by the time it takes to get those materials. ONE way (choose) the job could be enlarged: making her responsible for buying and storing the materials encouraging her to offer things such as biscuits encouraging her to offer a sandwich service at lunchtime

Activity 6. 6 Potential marks: Factor: What is required: Job designed according to guidelines given in textbook 1 -10 Job designed to encourage productivity 1 -10 More responsibilities added to enlarge the job 1 -10 Different elements introduced to provide development opportunities for job holder 1 -10 Job description meets all the elements listed in the textbook 1. 10 Job enrichment or enlargement Job description

Activity 6. 7 1. 2. 3. 4. 5. 6. Sandra requires skills training related to interpersonal skills and decision-making skills . Cleaven requires induction training providing organisation knowledge and job knowledge . Patrick requires skills training in the form of driving instruction for the appropriate vehicle. All employees require skills training related to the use of their new computer software in their jobs . Patrice requires skills training to help her to deal positively with interpersonal workplace conflict . The sales team require skills and general knowledge training to guide them how to understand use the Consumer Protection Act as part of job knowledge.

Activity 6. 8 1. The best type of performance appraisal takes place (E) every day. 2. Performance appraisal is the process of (G) monitoring an employee’s performance. 3. If you do a performance appraisal only once a year, you risk (A) leaving underperformance unattended, and so wasting time and resources. 4. Performance appraisals should be carried out by (F) the employee’s direct manager. 5. Every employee should have (B) personal goals or targets. 6. Before the appraisal, the employee should (C) write down whether he or she has achieved the goals. 7. Personal goals or targets should meet the (J) SMART criteria. 8. A good appraisal will probably take (I) about one hour. 9. A good appraisal should include a discussion on (H) available resources and training needs. 10. If you do not do follow-up actions after the appraisal, the appraisal is (D) a waste of time.

Activity 6. 9 Potential marks: Q: Factor: What is required: 1 Salary and payment times Student researched to find appropriate salary for job specification Student stated appropriate payment times for job 1 -10 1. 5 2 Minimum wage Student answered appropriately in relation to job 1 -5 3 SITE or PAYE Student made appropriate choice of tax process 1 -5 4 Benefits Student stated appropriate benefits in relation to job Student gave appropriate values for benefits chosen 1 -10 5 Fair pay Student made appropriate statement regarding fairness of pay Student explained why pay considered fair 1 -5 Student explained why proposed remuneration considered to be affordable to business 1 -5 6 Affordability

Activity 6. 10 l The trade union and bargaining council will depend on the industry sector in which the student’s new venture business operates.

Activity 6. 11 1. 2. 3. 4. The Labour Relations Act requires you to recognise trade unions and to involve trade unions in your negotiations on behalf of employees . Your employees have a right to strike if they cannot negotiate suitable terms of employment; during a strike you lose the production and sales you would have if your employees worked. Your are required, by the Basic Conditions of Employment Act, to state overtime rates as part of the contract of employment . Therefore, your employees should have prior knowledge of the overtime rates they will be paid . You need to assess your business for dangerous chemicals and processes that might hard employees . You also need to take action to minimise any risk by providing protective clothing and safety gear . The 1% of employees’ salaries paid to the UIF is a cost to your business . Therefore you have to take it into account when costing products and fixing selling prices or it will reduce your profitability .

Module 6: Final summative assessment (1 of 2) 1. 2. 3. 4. 5. 6. Job analysis means reviewing a job to identify the overall characteristics required of the next job holder . Job description is a description of the tasks required to complete the job . Job specification is detailed statement of the tasks and personal characteristics needed to complete the job successfully . The information in a job advertisement must be correct and up-to-date so that it will result in application only from those capable of doing the job properly . Psychological testing aims to identify how an applicant might behave in certain workplace situations . Physical testing aims to identify health problems that might impact on the job . The purpose of job design is to arrange job tasks to get the best performance . Job enlargement means adding more tasks to make the job bigger . Job enrichment means looking for ways to make a job more interesting and more motivating because it adds responsibility . THREE (choose) focus areas of a training and development programme are organisation knowledge through induction training; job knowledge through skills training; individual needs through technical training; interpersonal skills training; decision-making skills training; general knowledge skills through development programmes.

Module 6: Final summative assessment (2 of 2) 7. 8. 9. 10. Every performance appraisal must start with personal goals which provide the targets that the job holder aims to achieve and against which he or she is assessed . TWO (choose) things to take into account when designing a remuneration package are: Level of skills and qualification required; industry and sector guidelines; union agreements; legal requirements; minimum wage agreements The purpose of a trade union is to represent and protect the interests of employee members . The purpose of a bargaining council is to negotiate wages and benefits for a group of member employees . The Labour Relations Act focuses on the right of every employee to join and be represented by a trade union . The Basic Conditions of Employment Act focuses on the right of every employee to be treated fairly in the workplace and to be given specific details of the employment contract .

Module 7 overview When you have completed this module, you should be able to: l Unit 7. 1: Explain the nature and characteristics of control, and how controlling a business helps it achieve its objectives. l Unit 7. 2: Describe the steps in the control process. l Unit 7. 3: Discuss various aspects of a business that need to be controlled, including terminating employment contracts, technology, stock and credit, and understand how budgeting, zero-based budgeting, ratio analysis and the break-even point are used to control a business.

Activity 7. 1 Q: Factor: What is required: 1 Organisation structure Student identified organisation structure from organogram Student clearly showed how the proposed structure would provide control of the organisation processes through the different levels 2 Resources Student identified the financial resources required and explained how they would help control a particular aspect of the business Student identified the production resources and explained how they would help control a particular aspect of the business Student identified the human resources and explained how they would help control a particular aspect of the business Potential marks: 1 -5 1 -10

Activity 7. 2 1. 2. 3. 4. Vuma needs to set targets for the 20 toys to be produced each day. It would be even better for him to set targets that tell employees which toys to produce and how many of each toy should be produced every day . If employees make 10 toys a day, there would be a deviation of 10 toys . If employees make five toys a day, there would be a deviation of 15 toys . The number of toys made each day might differ because some toys can take longer to make than others . Numbers can also be influenced by the availability of materials, tools and other resources . To resolve the factors identified in 3 above, Vuma would have to ensure that materials, tools and resources are available for every toy . He would also need to schedule toys according to the time it takes to make each one .

Activity 7. 3 Disadvantages of terminating an employee include the following: l You lose the productivity of that employee l The process of recruiting a new employee (advertising, interviewing, etc. ) is very expensive l It takes time and effort to get a new employee l The dismissed employee loses his or her livelihood l When an employee loses his or her job, there is less money spent in the community l The dismissed employee can go to a labour tribunal which takes more time and money to defend l Dismissals tend to de-motivate other employees

Activity 7. 4 l l l Student is required to update and change information in the previous Budget Statement for his or her new venture business Student is required to explain each change The revised Budget Statement will be needed for future activities

Activity 7. 5 Calculations should be as follows: Ratio: 2012 2013 Profit on sales (POS) 28. 4% 21. 1% Return on capital employed (ROCE) 60. 8% 37. 7% Current ratio 2. 97 9. 2% Acid-test ratio 2. 82 8. 2% Debtor turnover 86 days 72 days Inventory turnover 48 days 120 days If your were buying the business, you would be concerned about the fall in profit and ROCE and the rise in Inventory Turnover

Activity 7. 6 l Student must first calculate categorise fixed and variable costs l Student then calculates contribution margin: Contribution margin = Income from sales - variable costs l Student can then calculate break even: Break-even point = Fixed costs Contribution margin / 12

Activity 7. 8 1. l 2. l 3. l l l The total cost of 50 pieces is: 50 x (R 10 + R 5) = R 750 (there is no discount on this level of order) The total cost of 200 pieces is: 200 x (R 10 + R 5) = R 3 000 less R 150 (5% discount) = R 2 850 Vuma would pay: R 15. 00 each (R 750/50) for 50 pieces R 14. 25 each (R 2 850/200) for 200 pieces Vuma would buy 200 pieces because they are R 0. 75 cheaper .

Activity 7. 9 Class discussion that should identify the following: l You are in business to make money and all money owed should be chased l There is no point paying professional fees if those fees cost more than the amount you are trying to collect

Module 7: Final summative assessment (1 of 2) 1. 2. 3. 4. 5. TWO characteristics (choose) of effective control are timeliness; effective organisation structure; strategic placement of resources; costeffective action; periodic evaluation of trends Setting standards is vital to the control process because they provide a benchmark against which to measure performance . No, you cannot fire an employee because you do not like him or her . Dismissal procedures have to comply with the Basic Conditions of Employment Act . Basic budgeting relies on building on data from a previous period . Zero-based budgeting checks every cost item from scratch . The advantages of zero-based budgeting is that it provides accurate information for pricing products and helps the business to remain competitive . TWO ratios you would use to make sure that your business is making a profit are Profit on Sales (POS) , and Return on Capital Employed (ROCE) .

Module 7: Final summative assessment (2 of 2) 6. 7. 8. 9. 10. Liquidity ratios are used to check how efficiently the business is using the money available in terms of inventory turnover, debtor collection, creditor payment, and the balance between current assets and current liabilities (1 example ). Break-even occurs when a business reaches a point at which it begins to make a profit . Stock or inventory in a business must be controlled to ensure that there always materials available to produce goods for sale , and that those materials have not deteriorated or been damaged during storage . Before giving credit to a customer, you must check his or her financial standing at the bank , and check with other suppliers who supply a similar level of credit . TWO costs (choose) of giving credit include loss of cash-flow during the period of credit; possible need to arrange and overdraft and pay interest in order to pay suppliers; risk of customer going out of business before paying your account; risk of the customer running away before paying your account

Module 8 overview When you have completed this module, you should be able to: l Unit 8. 1: Explain the term ‘operations management’ and the three elements of operations management. l Unit 8. 2: Explain the importance of products and services, capacity, facilities and technology when designing an operations system. l Unit 8. 3: Explain the key aspects that need to be controlled when you use an operations system. l Unit 8. 4: Describe the different factors that influence a business’s productivity. l Unit 8. 5: Explain the requirements of a quality control system, and describe the possible costs of quality control.

Activity 8. 1 Business: Inputs: Transformation processes: Outputs: Car repair business Tools; technical skills; spare parts Identifying problems; removing broken parts; replacing new parts; replacing oils Repaired vehicle Clothing shop Display racks; clothes; payment till Ordering and receiving clothes; displaying clothes; selling clothes to customer Sold clothing

Activity 8. 2 Product details should include the following: l What the product is made from (materials used) l How the product is finished (painted etc. ) l Product sizes available (small, large, etc. ) l Colours available l How the product is packaged l Who the product is aimed at (customer demographics)

Activity 8. 3 1. 2. 3. 4. 5. 6. 7. Sandra must determine the capacity of the new photocopier. Samantha should investigate economies of scale to facilitate discounts. Simon should investigate economies of scale to save money by making more loaves of bread. Sheila needs to eliminate the bottleneck created around the buttonhole machinist. David should determine the capacity of his workers and provide good breaks. Grant needs to eliminate the bottleneck caused by the work imbalance. Gertrude has probably found that the capacity of the kettle is insufficient for the way it is operated and must find the best operating level for the item.

Activity 8. 4 Storage Toilets and Kitchen Was h Style Was h X X X Product display Style Waiti ng Reception and till

Activity 8. 6 1. 2. 3. 4. 5. 6. 7. sequencing quality control continuously the deadline for completion of the task make sure that you buy enough goods to keep your business process flowing smoothly inventory control damage

Activity 8. 7 Influences on productivity: l Employees directly influence productivity by the amount of work they do and the quality of that work. l Management controls resources that influence productivity. l Raw materials influence productivity when they are available when needed and of sufficient quality to use immediately. l Operations influence productivity by being organised in an appropriate flow for the business. l Market conditions influence productivity by creating benchmarks for quantities demanded by customers.

Activity 8. 8 David needs to: l Identify the cause of the problem , which could be related to the equipment used or to the employees using the incorrect timings l Address the problem by correcting faulty equipment or training employees in correct timings l Re-check the next few batches to make sure that everything is okay

Module 8: Final summative assessment Student needs to provide answers related to personal new venture business: l Major capital items (machinery , equipment , vehicles , furniture , storage equipment , etc. ) required to start the business l Major materials required to operate the business l At least TWO suppliers for each of the items listed in 1 and 2 above (some research required) l An estimate of the quantities of materials , monthly , to meet the sales budget shown in the business plan l Quality of materials required to meet customer demands for products, in terms of whether a higher or lower quality will be required. Give a reason for your answer l Type of transport suitable to deliver materials from supplier to business, and to deliver finished goods to the customer (if either are not required, state your reason for that decision) l Any special factors you need to take into account regarding handling and storage to avoid damage and deterioration

Module 9 overview When you have completed this module, you should be able to: l Unit 9. 1: Know how to compile supporting documents for an appendix. l Unit 9. 2: Adapt the business plan into a presentable format. l Unit 9. 3: Present the business plan for a practical mark. l Unit 9. 4: Evaluate the business plan.

Activity 9. 1 Student should: l Investigate all information collected for his or her personal business plan l List complex or large-quantity information that should go into the appendix l Explain the choices made

Activity 9. 2 Student to make notes of areas of business plan where he or she can include more information following completion of the N 5 course

Activity 9. 3 Information required: 1. Information on the levels of management and the management functions, with reasons. 2. In the executive summary, include your personal mission statement. 3. In the part of the business plan that covers management information, information on motivating employees. 4. Insert a separate section, before the marketing section, containing the ethical standards for the business, and how social responsibility will be promoted. 5. In the part of the business plan that covers management information, an organogram of organisational structure. 6. Job description for self or top-level employee in an appendix cross-referenced to the main part of the business plan. 7. Information on how to calculate the salaries of employees. 8. In the part of the business plan that covers operations: Production capacity of the machines; Layout of the business, showing work-flow; Technology you will use in the business, and how this technology will increase competitive advantage; Control of the purchasing function; Inventory control; Quality control. 9. Include relevant documents in the appendix and cross-reference to these documents in the main part of the business plan.