Summary Unit 6 Principles of management (Full notes)

Unit 6 Principles of management

Leader – a person who sets the overall company vision and targets and makes decisions on
how the vision can be met.

Leaders require a certain personality, which can be nurtured.

Manager – a person who is responsible for controlling and using resources (including staff)
as productively as possible.


Unit 6 Management by objectives (22.09.2020)

Leader is a person who sets the overall company vision and targets and makes the vision can
be met and a manager is a person who is responsible for controlling and using resources as
productively as possible.

Good leader – influential, resilient, innovative, interpersonal skills.
Bad leader – abuse power, immoral.

Good manager – confidence, organized, good motivator.
Bad manager – lack of perseverance.

Peter Drucker –

 Review objectives for the whole business

 Set objectives for the management of the different functions of the business

 Set objectives for individual departments and workers

 Monitor progress – managers and workers check to see if the objectives are being
reached

 Evaluate performance and give reward if the objectives were reached.

Explain the benefits of management by objectives to McDonald’s


Unit 6 Leadership and Business culture (23.09.2020)

 Creativity – Business requiring innovative workers may use more delegation and
empowerment to give workers freedom.
 Start up businesses with limited capital may need to pay lower wages – How will this
affect worker morale and productivity.
 Determined
 Innovative

,  Budgeting
 Interpersonal skills
 Communication skills
 Time management
 Organized

Transformational leadership
Transformational leadership is a theory of leadership where a leader works with teams to
identify needed change, creating a vision to guide the change through inspiration, and
executing the change in tandem with committed members of a group.

Transactional leadership
Transactional leadership is a style of leadership in which leaders promote compliance by
followers through both rewards and punishments.

Transactional leadership pros:
 Rewards those who are motivated by self-interest to follow instructions
 Provides an unambiguous structure for large organizations, systems requiring
repetitive tasks and infinitely reproducible environments
 Achieves short-term goals quickly
 Rewards and penalties are clearly defined for workers
Transactional leadership cons:
 Rewards the worker on a practical level only, such as money or perks
 Creativity is limited since the goals and objectives are already set
 Does not reward personal initiative


Unit 6 Leadership, Management and Styles (24.09.2020)

 Autocratic – A style of leadership where decision making is made by the leader who
does not consult others.
 Democratic – A style of leadership where the leader involves others in decision
making.
 Paternal – A style of leadership where the leader takes others views into account but
makes the final decision.
 Laissez fair – Where the leader allows subordinates to take control and make
decisions (empowerment)

Quality circle – Where workers and managers are able to offer their views on how to
improve the production process.

Autocratic management is a style of leadership where decision making is made by the leader
who does not consult others.

One-way John can benefit from using autocratic management style is that he makes all
decisions by himself. This means that he is in full control of this business.