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What is meant by the term short-termism?
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What is meant by the term short-termism?
Short-termism is the focus of decision-making on short-term priorities and objectives, often at the expense of long-term opportunities and goals.
True or False?
Evidence-based decision-making involves gathering and analysing data to inform decisions.
True.
Evidence-based decision-making involves gathering and analysing data to inform decisions.
What is meant by long-termism?
Long-termism is the approach of making decisions with a focus on long-term goals and opportunities, even if it may involve sacrificing short-term gains.
True or False?
A short-termist approach to decision-making is likely to prioritise returns to shareholders.
True.
A short-termist approach to decision-making is likely to prioritise returns to shareholders.
What is subjective decision-making?
Subjective decision-making is guided principally by the personal opinions and experiences of key decision-makers.
Define evidence based decision-making.
Evidence based decision-making is the process of taking a systematic and fact based approach when determining objectives, strategies, and tactics.
True or False?
Establishing and nurturing meaningful and lasting relationships with suppliers indicates that a business has a short-term approach to decision-making.
False.
Establishing and nurturing meaningful and lasting relationships with suppliers indicates that a business has a long-term approach to decision-making.
State two common visual features of a strong company culture?
Common visual features of a strong company culture include:
Business specific artefacts, e.g. uniforms
A well known figurehead as a role model
Ceremonies, rituals and customs, e.g. awards evenings
Layout of business premises, e.g. open plan offices
Clear training culture, e.g induction and on-going training
True or False?
In a strong company culture, a 'them and us' attitude may exist between workers and management.
False.
A 'them and us' attitude between workers and management is more likely to exist in a company with a weak culture.
True or False?
A power culture is characterised by few rules and decision-making concentrated in the hands of a few powerful individuals.
True.
In a power culture, decision-making is carried out by one or a small number of powerful individuals at the top of the business hierarchy.
What is a role culture?
A role culture is where key decisions are made by those with specific job roles. Power lies with those with particular job titles rather than those with desirable skills.
Define a task culture.
A task culture is where decisions are made by teams made up of employees with specific skills. Power lies with those with task-related skills.
What is a person culture?
A person culture is where individuals with extensive experience and skills are loosely brought together. These individuals have significant power to determine their own decision-making procedures and often work autonomously.
True or False?
A business's ownership type can influence its corporate culture.
True.
The ownership type of a business can influence the business culture.
True or False?
In a role culture, teams are often created and dissolved as projects are started and completed, with an emphasis on flexibility.
False.
Task cultures emphasise flexibility. Teams are often created and dissolved as projects are started and completed.
What is meant by the term shareholder approach?
A shareholder approach focuses on meeting the short-term profit maximisation needs of shareholders which are to provide healthy dividends.
Define the term subculture.
Subcultures refer to unofficial or informal groups within an organisation that may have their own attitudes, values, and behaviours that differ from the overall corporate culture.
What is the definition of a stakeholder?
A stakeholder is an individual or group that affects, or is affected by, the actions of a business.
True or False?
Employees and managers are examples of internal stakeholders of a business.
True.
Employees and managers are both internal stakeholders of a business.
What is the primary objective of shareholders?
The primary objective of shareholders is to maximise returns on their investments.
Define external stakeholders.
External stakeholders are individuals or groups outside of a business, such as customers, suppliers, the local community, and government, that affect or are affected by its actions.
What is the stakeholder approach?
The stakeholder approach is a business strategy that ensures the benefits and drawbacks of its operations are shared among stakeholders, rather than being focused on the needs of shareholders.
True or False?
Suppliers and other creditors are examples of internal stakeholders.
False.
Suppliers and other creditors are examples of external stakeholders.
Which stakeholder group most desires a business to have a positive impact on the area surrounding its premises?
The local community
What is a pressure group?
A pressure group is an organisation that seeks to influence the policies and actions of businesses or governments, with the primary objective of promoting a specific cause or agenda.
How do shareholder and customer expectations differ?
Customers aim for fair (or low) prices as well as good customer service. However, shareholders demand high profits to achieve maximum dividends.
True or False?
Employees aim for higher wages and better conditions, which is likely to increase costs and reduce profits.
True.
Employees aim for higher wages and better conditions, which is likely to increase costs and reduce profits.
Define the term business ethics?
Business ethics relates to the rights or wrongs of making business decisions that are beyond legal requirements.
True or False?
An ethical code of practice informs decision-making and sets out how a business behaves responsibly.
True.
An ethical code of practice informs decision-making and sets out how a business behaves responsibly.The code of practice can include aspects such as environmental protection, fair working practices, and responsible supply chains.
What is the trade-off between profit and ethics?
Taking an ethical approach may increase costs and reduce overall profits if prices cannot be raised to compensate. However, businesses that choose to adopt ethical principles usually attract long-term loyalty from employees and customers.
What is the gender pay gap?
The gender pay gap refers to the difference in average earnings between men and women, with women typically earning less than men for the same work.
What is the meaning of the term minimum wage?
Minimum wage refers to the legally required minimum amount that employers must pay their workers per hour.
True or False?
Executive bonuses are not an ethical concern.
False.
Executive bonuses, particularly when they are disproportionately high, are considered an ethical concern related to pay and rewards.
True or False?
Corporate social responsibility can help a business recruit strong candidates for vacant job posts.
True.
Corporate social responsibility can help a business recruit strong candidates for vacant job posts, as ethical businesses often have a good reputation that is attractive to applicants.
What is the definition of sustainable sourcing?
Sustainable sourcing refers to the practice of acquiring raw materials and components from sources that are environmentally and socially responsible.
True or False?
Responsible marketing may involve directing marketing communications to children under the age of 12.
False.
Responsible marketing involves practices such as not actively directing marketing communications to children under the age of 12 or not directly advertising products high in fat, sugar, or salt to children under the age of eighteen.
What is a corporate responsibility report?
A corporate responsibility report is an annual report that provides an audit of the steps being taken by a business to meet their commitments to a range of stakeholders. It is usually published alongside financial reports.