BUSI-1005 Exam Review PDF

BUSI-1005: Final Exam Review Chapter 11- Motivation in the Workplace Motivation: internally generated drive to achieve a goal/follow a particular course of action. Intrinsic Motivation (from inside employee): enjoyment of doing tasks, satisfaction of job well done, desire to achieve, creative/innova...

BUSI-1005: Final Exam Review Chapter 11- Motivation in the Workplace Motivation: internally generated drive to achieve a goal/follow a particular course of action. Intrinsic Motivation (from inside employee): enjoyment of doing tasks, satisfaction of job well done, desire to achieve, creative/innovative ideas/executions. Extrinsic Motivation (actions taken by employer): financial incentive (bonus/raise), prizes, promotion, fear of punishment. 4 Important Theories of Employee Motivation: Maslow's Hierarchy of Needs (down-up) Physiological: have all basic needs (food and housing) Safety: free from physical, emotional, mental harm Social: feel sense of belonging among others Esteem: feel sense of self respect and pride Self-Actualization: have reached full potential Two-Factor Theory Hygiene Factors (pay, job security, company policies, relations with others, quality of supervision, physical working conditions) can cause more dissatisfaction. Motivation Factors (recognition, achievement, responsibility, promotion opportunities, opportunities for personal growth) can increase employee satisfaction. Expectancy Theory Effort: employees believe effort will produce acceptable performance Performance: employees believe acceptable performance will earn desired reward Reward: employees value the offered reward Equity Theory “Contributions to rewards” ratio; if an employee feels job inputs he contributes are more than job outcomes he receives he will not be motivated; also compare how they are treated to how others are; asking themselves “Am I fairly treated?” Chapter 12- Human Resource Management What’s involved in HR Management Strategy & Planning: how many, what job, how long-permanent/temp contract, weekly need- PT/FT? Attract Talent: recruit great candidates, select best fit employees. Develop Employees: orientation, training for role, ongoing development. Retain Quality Employees: motivate to excel, appraise performance, compensations/benefits, make (great place to work) External Employment Environment: employment laws, supply/demand workers. Human Resource Planning: having right number of employees, with right skills, in right place, at right time Job Analysis: WHAT is the work; explains job itself (hours, type of work, duties, responsibilities) Job Description: Job Specification: WHO is needed; lists qualifications needed (skills knowledge, abilities) HR Supply/Demand Forecasting Steps in forecasting employment: 1. Identify number/type of employees currently available in firm- number of people/skills 2. Forecast employees/skills needed to reach company mission/vision. 3. Measure gap between two above; hire to fill gap/lay off. Contingent Workers- Rise of Gig Economy: Employer Decisions: permanent, contingent, contract, on call workers; full-time/part-time hours per week; outsource work to another company. Why is contingent work so prevalent: Employees can be hired/dismissed easily- no severance pay required Easy to add temps when busy/reduce temps when work slows down May be lower wage level, no benefits Can try people before hiring, an hire for one time projects Downsides to company: high training cost/turnovers, less employee loyalty, less commitment to company goals Hiring: Recruiting Process of attracting qualified individuals to apply for open jobs Internal Recruiting: present employees as candidates, specially for promotions; builds morale/employee retention External Recruiting: attract from outside organization; recruit externally from: (company website-careers section, campus interviews/job fairs- college/university, internships, referrals from current employee, announce on employment website, union/trades hiring halls, walk-ins, job fairs) Hiring: Selection Choosing a person who: has skills for job, fits with company now/future, personal values align with org. values. Steps to Choose Right Hire: 1. Application 2. Employment test 3. Interview 4. Security clearance/reference checks 5. Final decision Important to use constantine process, interviewers, testing, questions to show that everyone is considered without discrimination Discrimination is Illegal when Hiring Canada/Onatrio human rights act makes discrimination in hiring/workplace illegal Discrimination: treating someone unfairly based on race, national ethnicity, color, religion, age, sex, sexual orientation. Equal pay for similar work by genders is law. Diversity, Inclusion Benefits Workplace Employee can connect with diverse customer base=good for business; workplace where employees feel they belong/respected= good for business; employees with broad range of skills/perspectives= good for ideas/solutions New Employee Orientation Base Matters: company history, values, policies, culture, leaders Practical matters: pay process, benefits, tour, etc. Learning the Job On-the-Job Training: learn by watching others do job in real time Off-the-Job Training: classroom, simulations, on-line training, reading material, testing Observation/Coaching by Supervisor: done in first weeks/months Compensation Options: Basic Compensation/Pay: hourly wages/annual salary, overtime pay, commissions (pay per sale), piece work (pay per item produced) Benefits: legally required benefits (CPP,EI,WSIB), paid time off, insurances (health benefits, life insurance, disability), retirement benefits (company pensions, RSP contributions) Incentive Programs (pay for performance): individual- (piece work, bonuses) company wide- (bonuses, profit sharing plans, company stock options) Intangible Benefits: praise, awards, performance ratings, thank you’s, pizza days, fancy office Companies offer “cafeteria benefits”- employee can select from to build customized compensation Benefits= very expensive for employer, highly valued by employee Keeping Jobs Interesting, Challenging for Long Term Employees Job Redesign: changes job description to avoid boredom Job Rotation: employees rotate systematically through few jobs Job Enlargement: add different tasks, to not do same thing all the time Job Enrichment: offer challenging new opportunities to grow skills Alternative Work Arrangement Traditional FT Work: 5 days weeks, 8 hrs days, fixed shifts (8-4/9-5), evenings, nights Alternatives: Flextime: wor when you want during day Compressed Workweek: work 4/fewer days a week, more hours a day Job Sharing: 2 people share 1 full time job/cover all hours Telecommuting: work from home Family-Friendly Programs: dependant care looking after young kids/elderlies- 50 hrs/year; parental leave/support; care for yourself (personal days, paid counseling, fitness programs), unmarried without children (need time for personal needs/social life) Performance Appraisals: 1. Set goals/performance expectations, specify criteria used to measure performance 2. Complete written evaluation rating performance according to stipulated criteria 3. Meet with employee to discuss evaluation/suggest means of improving Benefits of PAs: confirms employees doing well; used to decide raises, bonuses, discipline, terminations; identify candidates for promotions; discuss performance in job, set goals; discuss career goals,future training, skill development; give regular feedback to all, not just poor performers. Challenges of PAs: can be emotional, judgemental, adversarial, defensive. Additional PA Methods: 4. Ongoing coaching/feedback during year, no surprises at PA time 5. 360 feedback, from boss, peers, subordinates 6. Upward feedback, give feedback to boss on performance When employees Leave Jobs: Voluntary Termination/Turnover: Reason for Quitting Unreasonable demands, opinion not valued, favoritism in pay/reward,/promotions, low wages/no benefits, don’t enojour work/boring work, poisoned work atmosphere. Involuntary Termination: Reason for Termination by Employer With cause: theft, violate code of conduct, found guilty of serious misconduct/wilful disobedience to employers orders; no severance pay or notice period required of employer Layoff: not enough work, job eliminated, restructuring; severance pay/notice given Poor Performance: employer needs to show they communicated/coached employee; document!x3 At will: if no contract, employer/employee can be end employment at any time,; no severance/notice required (rare today) Chapter 13- Unions Unions: organized groups of workers; generally workers vote to be members of union, employer not part of decisions; bargains with employer to obtain contract for employees Goal: Improve union members pay, benefits,job, security, working conditions. History Big in 1800s in UK, US, Canada; were few laws for working conditions, safety, minimum wage; Labour unions drove lots of worker protection in law today; today- government workers, factories, airlines are main unionized workplaces; many large employers are anti-union/try to keep employees more satisfied. Unions: have pyramida structure; bottom= locals that serve workers in particular geographical area; negotiations start when each side states position and presents demand; if negotiations stall, the side may call in outsiders How collective bargains work: 1. Representatives from unions discuss contracts. If what management wants and what employees want are different, collective bargain (negotiation) begin  2. After negotiations, tentative agreement may be reached between management/union leaders 3. No tentative agreement- union often may threaten to strike; strike vote gives permission to call strike 4. Ratification vote by all union members is take to accept/reject tentative agreement 5. Accepted= contract is signed and becomes collective agreement 6. Rejected= management/union resort to strong pressure to influence the process. If collective bargaining does not get contract, each side has tactics to use: Union: work slowdown, strike (withdraw labor services), picket (members may picket the company and have large signs at the company entrance), boycott (workers/public don't buy products) Management: lockout (wont let employees into work to do their jobs), during a strike by union managers do work, strike breakers, contracting out (hiring another company to do work), move work to other country, easier with globalization Alternatives to Strikes Mediation: union/management agree to appoint neutral third-party to hear/recommend possible solution; no legal authority to enforce recommendation Arbitration: Appoint third-party arbitrator to devise/impose solution; “binding arbitration” as both union/management must accept contract the way arbitrator decides Chapter 14- Marketing Marketing: Process for creating, communicating, delivering value to customers/improving customer relationships Coming up with product, defining features/benefit, setting price, identifying target market, providing value, getting people to buy, managing relationships with customers Marketing Concept: Satisfying customer need while meeting company goals (profitability/growth) 1. Find out what customer/potential needs 2. Develop products to meet needs 3. Engaged entire company in efforts to satisfy customer 4. Results should be profit/growth Selecting Target Market Identifying Market: consumer- for personal use, Industrial- for use by business to make product Segment Market: demographic, geographical behavior, psychographic (attitude, value, desires) Cluster Segments: starbucks; urban,25-40 years, income educated, enjoy being special Marketing Mix: Plan designed to reach target market /(4 P’S) Product: developing product that meets need of target market Price: setting price for product Place: distributing the product to place where customer can buy Promotion: informing potential buyers about it Market Research: collecting/analyzing data relevant to marketing situation Primary Data: in-depth interviews, surveys, focus groups, social media monitoring Secondary Data: government statistics, industry associations, trade publication, company website, market research reports Branding Private branding: manufacturer makes product for retailer who attaches own brand to product (walmart,great value) Generic Branding: Not easily differentiated from competitors Manufacturer Branding: Nike shoes Brand Equity: added value generated by favorable customer experiences Packaging/Labeling: Promoting a Product Promotion tools: Advertising-non personal; personal selling; sale promotion (loss leader item); publicity/public relations Interacting with Customers Customer-Relationship Management: complaint handling, reward programs, image Social Media Marketing: more targeted, more immediate, challenging to manage, viral content-good/bad New Model: SAVE: Solution: define offering by needs they meet not by features, functions,etc Access: develop integrated cross-channel presence considering customers entire purchase journey, instead of emphasizing purchase location.channels Value: articulate benefits relative to price, rather than stressing how price relates to product cost, profit margins, competitor prices Education: provide info relevant to customer needs at each point of purchase cycle, rather than focusing on pr, advertising, etc that cover the waterfront Chapter 15- Accounting Accounting: process of measuring/summarizing business activities, interpreting financial info, communicating results to stakeholders Fields of Accounting Management Accounting: info create for internal use- usually management within firm; usually focused on future projections; helps managers/executives analyze risks, prioritize, make decisions Financial Accounting: Preparing organizations financial statements, focuses on past; income statement, balance sheet; accountants follow International Financial Reporting Standards (IFRS) ensuring consistency/fairly compare with other companies; summarize company’s past performance/evaluate current financial condition Related Fields: auditing, forensic accounting, bookkeeping Many stakeholders use financial accounting- Stakeholder: any person/group with interest in financial success, current/future stability of company Internal Stakeholders: employees, manager, owners External Stakeholders: suppliers, society, government, creditors, shareholders, customers Financial Statements Balance sheet (statement of financial position): firms overall financial position at one date in time (assets+liabilities=owner’s equity) Income Statement (profit-loss statement): revenues/expense/whatever profit made during a period of time Statement of Cash Flow: show cash received/paid out during period of time (cash from operations, from investing, from financing Break-Even Analysis: Calculates the value of sales needed in order to show profit E.g: Assume cost to play is $3000. Ticket price is $25, breakeven is 120 tickets at $25. If the ticket price is $30, the break -even point is just 100 tickets. If ticket price is $15, break even is 200 tickets, but more people may be willing to purchase Financial Statement Analysis- using Ratios Trend Analysis from Income Statement: compare results in same company year over year Benchmarking Analysis: compare result different companies in same industry Using Ratios to Analyze Financial Statements Solvency ratios (short term-long term): current ratio (current assets/liabilities), debt equity ratio (total debt/owner’s equity) Profitability Ratios: return on equity (net income/owner’s equity), earnings per share (net income, # common shares), return on sales (net income/sales revenue) Efficiency/Effectiveness/Activity Ratios: inventory turnover ratio (cost of goods sold/ave inventory) Chapter 16- Personal Finances Personal Finance: application of financial principles to decision make ith your money, for your/families benefit Financial Planning: process of managing personal finances in order to meet goals set for yourself/family Financial Planning Life Cycle 1. Build wealth 2. Preserve/increase wealth 3. Live on saved wealth after retirement Compounded Interest In savings: earning interest on interest already earned on savings/investments overtime In borrowing: interest paid not just on initial principal, but also on accumulated interest from previous billing periods. Time Value of Money: principal that a dollar received today (present) is worth more than dollar received in future Credit Score Calculated using: payment history (pay on time, everytime), use of available credit (don;t run at limit on cards), length of credit history (start early) , number of inquiries (don’t be frequent credit seeker), types of credit (borrow for the long term needs-don't have many cards) Average canadian score is 650 300-560: Poor 561-660: Fair 661-725: Good 760-900: Excellent Improving Personal Budget Keep written record of spendings/total it weekly; keep all atm receipts/count up fees; take $100 cash to spend, tap is too accessible; don't shop when bored/for entertainment Make changes; what can be eliminated from expenses; what can be reduced; what areas can you be a smarter consumer. Chapter 17- Risk Management/Insurance Risk: uncertainty about future event; businesses face risk daily 2 Types Speculative Risks: possibility of gain or loss (financial investments, starting business, gambling) Pure Risks: possibility of a loss only (fire, car accident, being sued) Businesses must manage both types of risks in cost effective manner to survive Risk Management: conserving firms earning power/assets by analyzing/reducing risk of losses due to uncontrollable/accidental events 5 Steps in Risk Management Process 1. Identify risks/potential losses- (could you lose assets, income, ability?) 2. Measure frequency/severity of losses and impact- (consider past history/current activities) 3. Choose best risk management option for each risk- (risk avoidance, risk control, risk retention, risk transfer) 4. Implement risk management techniques/processes- (e.g: installing fire alarms/sprinkler systems) 5. Monitor risk results- (successful risk control?, any new risks) 4 Options to Prevent/Manage Risks 1. Risk Avoidance: decline to start/stop participating in risky activities 2. Risk Control (reduce potential for loss): loss prevention (use of techniques to prevent loss from occurring- maintaining brakes, cleaning lint in dryer); loss reduction (techniques to reduce effect of losses that do happen- wearing seatbelts, sprinkler system) 3. Risk Retention: decision to cover manageable/predictable losses from company/personal funds (large deductible, not buying insurance) 4. Risk Transfer (to insurance company): purchase insurance to pay in event of loss Risks/Hazards Hazard: condition present which may cause the loss/make loss more severe Physical Hazard: item being insured (wood stove,broken stairs, improper storage of volatile substances) Moral Hazard: human element at risk (poor training, poor auditing of books, poor maintenance of buildings) Insurance: undertaking by one person to indemnify another person against loss/liability for loss in respect of certain risk to which gh object of insurance may be exposed, or to pay a sum of money/other things of value upon the happening of certain events. Insurance Policy: contract between insurance company/insured person; is an agreement enforceable at law Policy: Protects business/individual from financial losses caused by insured perils; lists what is covered, how much would be paid, exclusions that are not covered Peril: event that could cause a loss (fire, theft, lightning, explosion) To be insured, the following must be true of the loss/event: Occurring in future, fortuitous (accident), not at direction of the insured Insurance Premiums Premium: amount of money consumer pays to purchase insurance policy; policy cover period of time (1 year), must pay premium each year to renew Fairness Principle: bigger risk leads to higher annual premium Manage Risk by Buying Insurance Insurance is a risk sharing tool, premiums of the many pay the losses of the few Risks to Insure Remove burden of large financial loss hitting a person Insure risks you can't afford to cover yourself Lender my insist you buy insurance to help pay back loans in event of major loss Insurance Fraud & Claim: Fraud claims cause premiums to rise; “stolen” vehicles, staged collisions- sometimes by organized crime across country (e.g; cargo theft: $5 billion per year in Canada) Opportunistic Fraud: Policyholder has legitimate loss, but inflates damage/exaggerates claims Consequences: denis claims, future exclusion of coverage, higher deductibles, higher premium for all Insurable Risks- Property, Human, Liability Property Losses Real Property: land/buildings Personal Property: personal movable, separate from real property Direct Loss: loss of economic value of property cause by insured peril Indirect Loss: cost incurred due to loss of use of that property Human Asset Losses Death or disability of employee Protect employees against injuries/accidents that could result in inability to work Purchase life insurance, disability benefits or employee benefit plan Liability Losses Usually results from loss to someone else caused by your premise, product, actions or those of family, pets, employees, operation of automobiles You are liable if you are found responsible for causing a loss You/your insurance company can pay the injured party/they can sue you to get legal judgment that you must pay. Cost may be large in any situation Also extend to personal injury: damage to character/reputation of third party in community Liable for slander, invasion of privacy, emotional hurt Negligence: failure to do what a reasonable person would do or not, resulting in injury or damage to others; may be held legally liable to compensate others financial loss; “directors and officers liability” Insurance Product- For Business Commercial General Liability Policy(CGL): standard insurance policy issued to business organization to protect against liability claims for bodily injury/property damage Many CGLs include coverage for liability for products that malfunction; liability in businesses= employees, shareholders, customers. Business Interruption Insurance: gives owner income if there major loss like a fire, business does not suffer as much when rebuilding Automobile/Business Insurance Business owns cars= need auto policy Must cover each driver, driving record/age matter when determining premium Insurance Business- Stakeholders Consumer: purchaser of insurance Intermediary: distribution system for insurance industry (broker, agent, direct writer) Insurance Company: risk taker (design products/services, administers funds, pays claims) Reinsurer: one/more insurance companies who share risk with primary insurer Government Regulators: protectors of public interest; insurance is regulated by provincial government in Canada