BUSINESS STUDIES

Junior College 1 Glossary of Terms

Definition of Terms. Write down the correct definitions of the following terms (based on the glossary in your textbook)

autocratic leadership a style of leadership that keeps al decision making at the centre of
1.
the organisation.
balance of payments (current account) this account records the value of trade in goods
2. and services between one country and the rest of the world. A defi cit means that the
value of goods and services imported exceeds the value of goods and services exported.
3. commission a payment to a salesperson for each sale made.
corporate culture the values, attitudes and beliefs of the people working in an
4. organisation, that control the way they interact with each other and with external
stakeholder groups.
corporate plan this is a methodical plan containing details of the organisation’s central
5.
objectives and the strategies to be followed to achieve them.
corporate social responsibility the concept that accepts that business should consider
the interests of society in its activities and decisions, beyond the legal obligations that it
6.
has by taking responsibility for the impact of its decisions and activities on customers,
employees, communities and the environment.
corporate strategy a long-term plan of action for the whole organisation, designed to
7.
achieve a particular goal.
decentralisation decision-making powers are passed down the organisation to empower
8.
subordinates and regional/product managers.
delayering removal of one or more of the levels of hierarchy from an organisational
9.
structure.
10. delegation passing authority down the organisational hierarchy.
democratic leadership a leadership style that promotes the active participation of
11.
workers in taking decision.
dismissal being dismissed or sacked from a job due to incompetence or breach of
12.
discipline.
dividends the share of the profi ts paid to shareholders as a return for investing in the
13.
company.
emotional intelligence (EI) the ability of managers to understand their own emotions,
14.
and those of the people they work with, to achieve better business performance.
employment contract a legal document that sets out the terms and conditions
15.
governing a worker’s job.
16. environmental audits assess the impact of a business’s impact on the environment.
ethical code (Code of Conduct) a document detailing a company’s rules and guidelines
17.
on staff behaviour that must be followed by all employees.
18. ethics are the moral guidelines that determine decision making.
external growth business expansion achieved by means of merging with or taking over
19.
another business, from either the same or a diff erent industry.
franchise a business that uses the name, logo and trading systems of an existing
20.
successful business.
hard HRM an approach to managing staff that focuses on cutting costs, e.g. temporary
21. and part-time employment contracts, off ering maximum fl exibility but with minimum
training costs.
22. hourly wage rate payment to a worker made for each hour worked.
human resource management (HRM) the strategic approach to the effective management
23.
of an organisation’s workers so that they help the business gain a competitive advantage.
24. hygiene factors aspects of a worker’s job that have the potential to cause dissatisfaction
 such as pay, working conditions, status and over-supervision by managers.
induction training introductory training programme to familiarise new recruits with the
25.
systems used in the business and the layout of the business site.
informal leader a person who has no formal authority but has the respect of colleagues
26.
and some power over them.
informal organisation the network of personal and social relations that develop between
27.
people within an organisation.
internal growth expansion of a business by means of opening new branches, shops or
28.
factories (also known as organic growth).
job description a detailed list of the key points about the job to be fi lled – stating all its
29.
key tasks and responsibilities.
job enrichment aims to use the full capabilities of workers by giving them the
30.
opportunity to do more challenging and fulfi lling work.
job re-design involves the restructuring of a job – usually with employees’ involvement
31.
and agreement – to make work more interesting, satisfying and challenging.
job rotation increasing the fl exibility of the workforce and the variety of work they do by switching from one job to
32.
another.
labour productivity the output per worker in a given time period. It is calculated by:
33. total output in time period, e.g. 1 year
total staff employed
labour turnover measures the rate at which employees are leaving an organisation. It is
measured by:
34.
number of staff leaving in 1 year x100
average number of staff employed
laissez-faire leadership a leadership style that leaves much of the business decision
35.
making to the workforce – a ‘hands-off ’ approach and the reverse of the autocratic style.
leadership the art of motivating a group of people towards achieving a common
36.
objective.
level of hierarchy a stage of the organisational structure at which the personnel on it
37.
have equal status and authority.
line managers managers who have direct authority over people, decisions and resources
38.
within the hierarchy of an organisation.
manager responsible for setting objectives, organising resources and motivating staff so
39.
that the organisation’s aims are met.
matrix structure an organisational structure that creates project teams that cut across
40.
traditional functional departments.
motivating factors (motivators) aspects of a worker’s job that can lead to positive job
41. satisfaction such as achievement, recognition, meaningful and interesting work and
advancement at work.
motivation the internal and external factors that stimulate people to take actions that
42.
lead to achieving a goal.
off-the-job training all training undertaken away from the business, e.g. work-related
43.
college courses.
44. on-the-job training instruction at the place of work on how a job should be carried out.
organisational structure the internal, formal framework of a business that shows the
45. way in which management is organised and linked together and how authority is passed
through the organisation.
part-time employment contract employment contract that is for less than the normal
46.
full working week of, say, 40 hours, e.g. eight hours per week.
paternalistic leadership a leadership style based on the approach that the manager is in a better position than the workers to
47.
know what is best for an organisation.
performance-related pay a bonus scheme to reward staff for above-average work
48.
performance.
49. person culture when individuals are given the freedom to express themselves fully and
 make decisions for themselves.
person specification a detailed list of the qualities, skills and qualifi cations that a
50.
successful applicant will need to have.
51. piece rate a payment to a worker for each unit produced.
52. power culture concentrating power among just a few people.
profi t sharing a bonus for staff based on the profi ts of the business – usually paid as a
53.
proportion of basic salary.
project groups these are created by an organisation to address a problem that requires
54.
input from diff erent specialists.
quality circles voluntary groups of workers who meet regularly to discuss work-related
55.
problems and issues.
recruitment the process of identifying the need for a new employee, defi ning the job to
56. be fi lled and the type of person needed to fi ll it, attracting suitable candidates for the job
and selecting the best one.
redundancy when a job is no longer required, so the employee doing this job becomes
57.
unemployed through no fault of his or her own.
58. role culture each member of staff has a clearly defi ned job title and role.
59. salary annual income that is usually paid on a monthly basis.
60. shareholder a person or institution owning shares in a limited company.
social enterprise a business with mainly social objectives that reinvests most of its
61.
profi ts into benefi ting society rather than maximising returns to owners.
soft HRM an approach to managing staff that focuses on developing staff so that they
62.
reach self-fulfi lment and are motivated to work hard and stay with the business.
63. span of control the number of subordinates reporting directly to a manager.
64. staff appraisal the process of assessing the eff ectiveness of an employee judged against pre-set objectives.
staff managers managers who, as specialists, provide support, information and
65.
assistance to line managers.
stakeholder concept the view that businesses and their managers have responsibilities to
66.
a wide range of groups, not just shareholders (see also corporate social responsibility).
stakeholders people or groups of people who can be aff ected by, and therefore have an
67.
interest in, any action by an organisation.
68. task culture this is based on cooperation and teamwork.
team working production is organised so that groups of workers undertake complete
69.
units of work.
temporary employment contract employment contract that lasts for a fi xed time period,
70.
e.g. six months.
71. training work-related education to increase workforce skills and effi ciency.
triple bottom line the three objectives of social enterprises: economic, social and
72.
environmental.
unfair dismissal ending a worker’s employment contract for a reason that the law
73.
regards as being unfair.
vision statement a statement of what the organisation would like to achieve or
74.
accomplish in the long term.
worker participation workers are actively encouraged to become involved in decision
75.
making within the organisation.
workforce audit a check on the skills and qualifi cations of all existing workers/
76.
managers.
workforce planning analysing and forecasting the numbers of workers and the skills of
77.
those workers that will be required by the organisation to achieve its objectives.