cape mob samplesba(2)
TRANSCRIPT
Table of Contents
Page #
Acknowledgement 1
Aims and Objectives 2
Methodology 3
Description 5
Analysis 6
Evaluation 15
Recommendations 17
Conclusion 18
Appendices 19
Bibliography 35
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Acknowledgement
Firstly, it is with gratitude that I recognize God for all the blessings, abilities
and privileges - especially physical and mental ones - which have allowed me to both
commence and conclude this School Based Assessment.
I also wish, secondly, to express a sincere appreciation to the teacher of this
wonderful subject, Ms.. Without the driving force of this individual, the completion of
this assignment would be a most difficult task as she thoroughly guided and mentored
me through the various stages of this SBA.
Lastly, I acknowledge my parents who supported me in all of my endeavours
and provided the inspiration and encouragement I needed to fulfil this task.
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Aims and Objectives
The Barbados Transport Board was chosen for this School Based Assessment
because of the great value it has to the Barbadian society and economy. In researching
the operations of the Barbados Transport Board, three main business concepts were
explored in an effort to assess, analyse and evaluate the firm.
The aim of this SBA is:
To investigate the way in which the formation of business objectives affects
the Transport Board’s ability to cope with change and meet financial
requirements.
The objectives of this SBA are:
To analyse the firm’s objectives.
To determine the overall reaction to change within the business.
To determine how the firm is financed and how it manages its debts.
Thesis Statement
“By establishing sound business objectives, a firm is able to successfully
implement change and acquire the finance necessary for its operations.”
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Methodology EmployedInformation for this assignment was collected by use of primary and secondary
sources.
An interview with the Financial Controller of the Barbados Transport Board, as
well as a questionnaire consisting of twenty-three questions, was used as primary
data collection methods.
The secondary source of research was the Transport Board’s website,
http://www.transportboard.com. On this website, the basic information was gathered
such as:
Year of founding
Number of buses
Locations
Number of terminals
Limitations:
In carrying out this experiment in order to formulate this report on the
Barbados Transport Board, there were a few limitations which impacted on the
reasons for employing the methods of data collection used.
The questionnaire could not provide all the information required because, by
administering lengthy questionnaires one runs the risk of several questions
being unanswered.
Some answers had little relation to the question being asked.
Reasons for Employing these Methods
A questionnaire would be more suitable for the number of questions being
asked as well as the number of possibilities listed for each question.
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The formation of a questionnaire is a more efficient way of acquiring precise
information.
An interview was used for three questions whose answers were unclear when
the questionnaire was completed. This was less time consuming and factored
in the verbal interaction that allowed the interviewee to better comprehend the
questions being asked.
The website was easier to use and more accessible for any additional
information which was found to be necessary after the interview and receiving
the completed questionnaire.
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Description
The Barbados Transport Board was formed by an Act of Parliament on August
24, 1955. Its mission is “To be the principal provider of safe, reliable and efficient
transit services and to consistently deliver the highest level of consumer satisfaction to
users of public transport in Barbados”.
Prior to 1955, transportation in Barbados was provided by public
concessionaires which operated on specific routes. Currently, however, the Transport
Board has become a vital part of the economic development of the nation. Located at
Roebuck Street, Bridgetown, the Board has approximately 304 buses with terminals at
three different locations, a central staging depot and one sub-terminal.
The objectives of growth and increased market share are paramount to the
organisation’s existence. The major factors that affect change at the Barbados
Transport Board include consultation with employees as well as clear objectives and
are impacted by political, economic and social changes.
Passive resistance to change is high among the staff mainly because of a fear
of job loss and increased workload. Despite this, the firm’s organisational culture
allows for and encourages change in a significant way even though feedback is not
considered a major element in the change process.
Due to the fact that the firm is subsidized by Government, its main financial
requirement is for the paying of daily expenses. When capital stock of buses needs
replacing, the funds are obtained from the Government’s resources.
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Analysis
(I) - Business Objectives
Jewell (2000) defines an objective simply as something that we seek to
achieve. At the Barbados Transport Board, the objectives are growth and increased
market share. However, there are several other objectives, corporate objectives as
explained in Marcousé et al (2003). As shown in Table (A) below.
Objectives Explanation Implementation in
Barbados Transport
Board
Maximising
organisational profit
In the private sector, this is usually
a primary objective as it is done in
the firm’s effort to survive when
threatened in the short-run1.
The Barbados
Transport Board is
not in the public
sector. Therefore, it
is funded by
Government and
seeks to provide a
service rather than
earn profits. Hence,
this objective is not
implemented.
Growth (size of firm) The motivation behind this goal is
the desire to see a firm fulfil its
potential and even eliminate
competition (horizontal
integration).
The firm aims to
increase the number
of buses it owns and
eliminate or reduce
reliance on route
taxis and PSVs
especially on shorter 1 In the Public Sector most Public Corporations replace the profit maximization objective with goals of providing essential services.
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routes.
Increased market share The aim is to control as much as
the markets as possible by having
a marketing mix more successful
than that of competitors.
Maximising sales
revenue
The levels at which sales revenue
are determine the salaries and
allowances of staff.
As it is a
Government owned
firm wages are
negotiated by Trade
Unions rather than
sales revenue.
Government’s
objectives and
income tend to
determine the level
of wages.
Maximising shareholder
revenue
This usually applies to public
limited companies which aim to
generate increased returns for
shareholders through raising
prices.
The firm has no
named shareholders
as it is a Government
owned firm seeking
to provide a public
good2.
Table (A): Corporate objectives and their application to the Barbados Transport
Board.
Different firms will have different needs, aims and objectives, but objectives
should be sound. Sound objectives, according to Jewell (2000) should conform to the
SMART criteria as shown in Table (B).
2 A public good is one that is non-rivalled and non-excludable. http://en.wikipedia.org/wiki/Public_good.
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Criteria Explanations
SPECIFIC Exactly pertaining to what is needed.
MEASURABLE
Based on performance-measuring criteria that would
assess whether or not objectives are being achieved.
AGREED
The individuals responsible for achieving the objectives
Agree on them.
RELEVANT
Pertaining to the needs of the organisation; capable of
being achieved within the time and with the resources
available.
TIMETABLED Constructed with an approximated period for completion.
Table B: Table explaining the SMART criteria
Of the five areas used in the criterion, the Barbados Transport Board only chose
relevance to the needs of the organisation, Though this was the only one chosen, it
may be argued that in setting business objectives, they must consider the specificity,
measurability and time constraints of the objectives.
Mission Statement
Mission statements as expressed in Stimpson et al (2007) are attempts to condense the
central purpose of a business’ existence into one statement. It is a statement of the
business’ core aims, phrased in a way to motivate employees and to stimulate interest
by outside groups. Jewell (2000) posits that a well-produced mission statement should
do five things. Table (C) below applies these to the Barbados Transport Board.
Features Application to Barbados Transport Board
Outlines clearly the way
ahead
“To be the principal provider…of public transport in
Barbados”
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Provide information and
inspiration for employees
“To be the principal provider of…highest level of
customer satisfaction…”
Identifies what the
organisation will be in the
future
“To be the principal provider of…”
Defines success “…the highest level of…”
Provides a statement that
can be used as a goal or
objective
“To be the principal provider of safe, reliable, and
efficient mass transit services and to consistently deliver
the highest level of customer satisfaction to users of
public transport in Barbados”.
Table C: Table applying features of a well-produced mission statement to that of the
Barbados Transport Board
(II) - Change Management
Jewell (2000) outlines some features of organisations which are more
receptive to change. Four of these features were used in the questionnaire. These
included:
1) Frequent consultation with employees
2) Trust
3) Retraining facilities
4) Clear objectives
Figure 1 shows how each was ranked on a scale of 1 to 5 within the Barbados
Transport Board.
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In the Barbados Transport Board, it is clear that the implementation of three of these
features is poor in that the highest level of relevance of the four is three on a scale of
one to five.
Nature of Change
Stimpson et al (2007) point out that there are ways that the nature of change
may be manifested within a business in its lifetime. These changes and their
applications to the Barbados Transport Board are explained below in Table (D).
Nature Explanation Application to Barbados
Transport Board
Political Political and governmental As a Government owned firm,
Figure 1: Graph showing the levels at which four features of organizations receptive to change are implemented in the Barbados Transport Board.
0
1
2
3
4
5
1 2 3 4Feature
Level of Im
plementation
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factors affect organisations and
stimulate change through shifts
in policy encouraging or
discouraging control, protection,
intervention and regarding
financial assistance.
political changes are prevalent
in that there will be increased
Government intervention in a
situation where the firm’s
survival is threatened. There is
also protection through
subsidies as the Government
would seek to lower production
costs while stimulating
provision and consumption.
Economic This deals with changes in the
external environment and
involves concepts such as
demand, supply, tax rates and
income distribution levels.
Depending on the income, the
elasticity of demand for public
transport would change because,
if income decreases, the quantity
demanded will increase because
public transport is an inferior
good.
Social This refers mainly to the changes
in social structure whether it is a
change in demographics or the
actual lifestyle and culture of
society.
In terms of the lifestyle, there
are fewer young workers as
most individuals are seeking
higher education. Therefore, the
number of young individuals
entering the labour force and
hence, being employed at the
firm, may very well decline.
Technological Advances in technology can
result in improved goods and
services.
If the firm were to employ new
machines which would make the
maintenance process easier and
more efficient, retraining of staff
would be necessary so as to
ensure this nature of change
may be coped with. For
example: by replacing
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conductors with fare boxes,
many employees had to be
trained to operate the boxes
efficiently.
Legal This generally speaks to
regulations and restrictions by
Government.
Health and safety laws have
been implemented not only for
the job site but on the vehicles
to ensure that a limited number
of persons travel on each bus.
Table D: Table explaining the nature of change and as applied to the Barbados
Transport Board
Reaction and Resistance to Change
Jewell (2000) outlines the possible reactions to change within the organisation.
The Barbados Transport Board experiences all of the reactions from its employees.
However, acceptance and active resistance are at a minimum, but indifference and
passive resistance are very dominant. Employees are reluctant to contribute and
strictly work-to-rule when the change process is occurring.
These reactions must be a result of underlying issues which Jewell (2000) also
lists. Of these, five were chosen and ranked by a member of the Management Team at
the Barbados Transport Board. These included:
1) Fear of job loss – 25%
2) Dissolution of working groups – 13%
3) Inability to adjust – 25%
4) Loss of power – 6%
5) Misunderstanding of the nature of change – 31%
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Figure 2 demonstrates the extent to which each is responsible for the reactions to
change in the firm under analysis.
Figure 2: Pie Chart showing the extent to which each factor is responsible for the reaction to change at the
Barbados Transport Board
Loss of power6%
Inability to adjust25%
Dissolution of working groups
13%
Misconstruing the nature of
change31%
Fear of job loss25%
From Figure 2 above, it can be seen that a misunderstanding of the nature of change
caused the greatest resistance to the change, while loss of power caused the least
resistance.
Ways to Overcome Resistance to Change
Jewell (2000) explains that there are several strategies to overcome change.
The firm being analysed only utilises one of these strategies. Management at the
Barbados Transport Board only communicates the need for change to the workforce.
However, educating them about the positive aspect of change, having mutual trust,
ensuring there is participation and involvement and getting their support from the
inception can help a firm overcome resistance. Negotiation and agreement through
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incentives as well as providing counselling and retraining facilities are also resistance-
conquering strategies as outlined by Jewell (2000).
(III) – Need for Finance
Stimpson et al (2007) state that finance is required for many business activities
which can include setting up the business, expanding, paying for expenses, research
and development and the day-to-day running of the business. The Barbados Transport
Board only requires finance for all of the above but, because of subsidization by
Government, these costs are mainly covered by the Government, leaving them only to
pay for expenses. Therefore, management does not have to devote a great deal of
concern to sourcing finance because Government covers any deficit which cannot be
covered by revenue.
The finance for this firm is usually short-term, that is, one year or less. This
means that it is sourced from bank overdrafts rather than creditors or debt factoring as
they do not apply to the type of business being analysed.
Marcousé et al (2003) define the acid test ratio as a ratio examining the
business’ liquidity position by comparing current assets and liabilities, but omits stock
from the total of current assets since stock is the most illiquid current asset. It is
recommended by professionals that the ideal ratio be approximately 1:1 to suggest
that the firm is meeting short-term payments. The Barbados Transport Board’s ratio is
less than 1:1 which implies cash flow problems and the inability to cover current
costs.
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Evaluation
The Barbados Transport Board has, in its establishment, created a vision and a
main objective to ensure that there is a sense of purpose for its employees and a goal
to work towards. From the responses given to certain questions on the questionnaire,
its objectives are only described as “relevant to the needs of the organisation”. When
mapped against the SMART criteria, this spells a problem for the organisation. It
suggests that there is no way for performance to be measured; the objectives do not
outline explicitly what needs to be achieved, how and by what time.
Conversely, it is not possible for an objective, in practice, nor theoretically, to
merely be ‘relevant’. Any objective has to be specific, measurable and timetabled. It
is possible though, for an objective not to be ‘agreed upon’ in that, in many cases,
some stakeholders are unaware of the business’ objectives.
Also, the Management by Objectives system is not implemented which means
that performance gaps may exist within the firm as the overall aim is not divided to
create specific targets for each department. This also points out the absence of a
hierarchy of objectives so the overall goal cannot be broken into strategies and tactics
and it is not possible to measure performance.
The firm employs moderate consultation with employees, but keeps trust at a
low level. Retraining facilities and clear objectives are very low as they were rated 1
out of 5. In analysing and evaluating how this firm manages, leads and copes with
change, it can be said that the low implementation of trust, retraining facilities, clear
objectives and consultation with employees are somewhat responsible for the firm’s
inability to react positively to change. Therefore, when fare boxes were implemented,
because of the lack of retraining facilities, trust, communication and clear objectives,
this change was a difficult one at the firm. The conductors would have had a negative
reaction to the change because it may have been sudden and they feared job loss. The
drivers, however, were also reluctant in that they would have to change routines and
habits for this change to be implemented successfully.
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All aspects of the nature of change need to be coped with by this government owned
organisation but communication is the only medium through which change is
promoted. Their communication system does not allow for feedback but ensures that
all stakeholders are briefed. Management tries to motivate employees to embrace
change through this medium. However, overall reaction to change in the business is
poor. This is mainly because of the misunderstanding of the nature of change and
various personal insecurities such as fear of job loss and the inability to adjust.
The firm’s financial requirements are met by the Government which owns and
subsidises it. This implies that Government will finance and support any unprofitable
operations through taxation receipts. This enables them to pay for short-term any
expenses. The day-to-day running of the firm, however, is funded by bank overdrafts.
Losses in this sector are not seen as management’s inability to make sound financial
decisions, but are acceptable as costs almost always exceed revenue. This is so
because prices are seldom charged to cover costs and make a profit at the same time.
Government may impose spending limits if financial deficits are too excessive3.
Recommendations3 Dearden & Foster (1993)
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Based on the information gathered in the questionnaire and the comparison of
the results to the literature, there are certain recommendations which could be made to
the Barbados Transport Board.
It is recommended that objectives be formulated as closely as possible to the
SMART criteria and be broken down into strategies and tactics for each
department within the firm. This should be done in an effort to ensure that the
workforce is motivated and coordinated.
By altering the objectives and motivating the workforce, the firm should also
aim to establish better worker-management relations employing trust,
delegation, participation and consultation so that when there is a need for
change, it may be implemented as successfully as possible by removing the
major stressors.
The Barbados Transport Board should assess any overhead costs like
advertising or professional labour and make the best of any opportunity to
reduce them. It should also sell any assets which are not generating revenue.
These should be done in an effort to improve the firm’s liquidity.
Conclusion
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After studying, analysing and evaluating the Barbados Transport Board, it can
be concluded that the establishment of objectives can affect all aspects of the
organisation including the ability or inability to cope with change and fulfil financial
requirements. All aims were met as the firm’s objectives were analysed, proving that
they did not align with the SMART criteria outlined in Jewell (2000). The negative
reaction to change was identified as well as the Government as the firm’s main source
of finance.
Appendix (A) – Literature Review
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Business Objectives:
Jewell (2000) defines an objective as something that we seek to achieve. An
objective is necessary in order to accomplish a variety of things including determining
a strategy and motivating employees. Objectives can come in three forms: strategic,
operational and tactical. Strategic objectives relate to the productivity of the firm,
which tactical objectives are short-term targets and operational objectives are
statements used to define outcomes to be achieved.
Objectives should adhere to the SMART criteria. This simply means that
objectives should be:
1) Specific – to the organisation’s needs
2) Measurable – in terms of using a performance measuring system
3) Agreed – persons responsible for achieving objectives have all argeed
4) Relevant – to the organisation and capable of achievement
5) Timetabled – constructed with a signpost for fulfilment
Stimpson & Mohammed (2007) outline several common objectives of the business
ranging from increasing market share to concentrating on core activities. They express
that the Management by objectives system which is “designed to motivate and co-
ordinate a workforce by dividing the organisation’s overall aim into specific targets
for each division…” can cause delegation and motivation to be very effective.
Management of Change:
Marcousé et al (2003) provide that “…Change is a permanent characteristic of
business activity…in some cases it can be anticipated…in others it is unexpected.”
Jewell (2000) outlines some external and internal pressures for change must be
identified. These were listed as competition, changes in technology, employees’
expectations and the financial environment. However, in practice, some organisations
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will be more receptive to change than others. This could be as a result of an
organisation employing trust, retraining facilities, management-employee consultation
and ultimately by establishing clear objectives.
Stimpson & Mohammed (2007) explain that there are several ways that the
‘nature of change’ may be manifested within a business. These include: political,
economic, social, technological and legal.
Political: Political and governmental factors affect organisations and stimulate change
through shifts in policy encouraging of discouraging control, protection, intervention
and regarding financial assistance.
Economic: This deals more so with changes in the external environment, that is, the
interaction between economies in the global market. This involves concepts such as
demand, supply, taxation, subsidization and distribution of wealth or income.
Social: Changes which are caused mainly by changes in social status, lifestyle, culture
and even age fall into this category.
Technological: When innovation and invention occur, change occurs as well, causing
technology to evolve. This ranges from improved good and services in a market to
faster and more efficient ways of completing various organisational processes.
Legal: Any regulations or restrictions placed on an organisation which is bound by the
laws of that land are seen as legal changes. Usually, Government would impose such
in an effort to ensure fairness in trade, safety and health on the job and with the
welfare of society in mind.
Reaction and Resistance to Change:
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Jewell (2000) outlines possible reactions to change within an organisation.
Change can be handled with: acceptance, indifference, passive resistance or active
resistance.
Acceptance: This would occur in situations where employees and all parties impacted
by the change are enthusiastic about the change being implemented it and are willing
to cooperate with management to ensure that it is successful.
Indifference: Employees may in some cases express a lack of concern and be
unresponsive to the changes in progress. This could be mainly executed through
minimal contribution to organisational activities surrounding the change being
implemented.
Passive Resistance: Some individuals in the work environment would resist by being
inactive. They may tend to present a non-learning attitude to the job or strictly work-
to-rule in an attempt to avoid submitting to the change being implemented.
Active Resistance: Slowing down, absenteeism, sabotaging, intentionally making
errors are attributes of this type of reaction to change. The change may be viewed as
illogical and workers may be upset or offended by the suggested change. This would
result in their resistance.
Change is resisted because:
Jewell (2000) expresses that analysing why change occurs is essential. He outlines
organisational barriers include:
1) Structuring inertia – complacency and belief that change will destroy the logic
behind current ways of operation
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2) Existing power structure – those with little power will feel most threatened by
change. If there is no ability to participate or make decisions, one may be more
threatened by the change.
3) Resistance by work groups – change will negatively impact work groups
through promotion, demotion or transferral.
Reasons for resisting change:
Fear of change: Job security is threatened by change and because the nature is not
properly communicated to employees, fear plays an integral part in resistance.
Disrupted habits: The methods used to complete a task may need to be revised and the
employee may find it difficult or be unwilling to ‘break away’ from redundancy.
Loss of control and confidence: The power an individual has at his/her job influences
their confidence. When manual labour is replaced by machinery or authority is
reduced, employees lose control and confidence and would therefore oppose the
change.
Poor training: Staff may not be provided with the skills needed to deal with new
technology and systems.
Redistribution of workload: New tasks, systems and objectives can result in workers
feeling as though they have been overburdened with work when other colleagues
seem to have less.
Lack of purpose: Change tends to leave some people unsure and insecure. If they
were excluded from the change process and their new role is not defined they may
suffer lack of purpose. Stimpson & Mohammed (2007)
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Resistance can derail the change process. The greater involvement, the greater the
probability of acceptance and contribution by workers is. Stimpson & Mohammed
(2007)
This resistance must be avoided and can be done by:
1) Increasing urgency.
2) Building the team responsible for guiding/leading the change process.
3) Establishing a vision identifiable by future staff.
4) Communicating and involving as many employees as possible
5) Remove obstacles to change by encouraging feedback and empowering
employees.
6) Create short-term aims that are relatively easy to achieve
7) Encourage determination and persistence.
8) Make change permanent by recruiting and promoting change leaders.
Communication and Change:
Good communication plays a vital role in allowing change to be effectively
introduced within an organisation. With two-way communication absent, the chances
of change being delayed and resisted is greater. Stimpson & Mohammed (2007)
Need for Finance:
Finance is required for several business activities. These can include the
following:
a) Setting up : A business will need injections of cash from owners to purchase
the necessary capital equipment and even premises. This is known as start-up
capital.
b) Day-to-day finance : All businesses need working capital to pay for bills and
expenses and to build up stock levels.
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c) Increasing capital assets : This is expansion and requires further finance and
can involve higher working capital needs.
d) Expansion: Finance may be required to by out other firms to increase market
share.
e) Research and development : Apart from purchasing assets, an organisation
must pay for research and development into new products and even invest in
new marketing strategies such as overseas markets. Stimpson & Mohammed
(2007)
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Appendix (B) – Questionnaire
1. What is the legal name of your business?______________________________________________________________________________________________________________________________________________________________________________________________________
2. What is the aim of your business?______________________________________________________________________________________________________________________________________________________________________________________________________
3. What is the mission statement of your business?______________________________________________________________________________________________________________________________________________________________________________________________________
4. Check the appropriate boxes below which describe your organisation’s objectives.
Specific – clearly states requirements
Measurable –based on criteria which measures their efficiency
Agreed – all persons responsible for achieving goals agree
Relevant – to the needs of the organisation; realistic
Timetabled – date for fulfilment and completion
Other, please specify: ___________________________________________________________________________________________________________________________________________________________________________
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5. Which of the following are some of the objectives of your business enterprise?
Profit maximisation
Growth
Increased market share
Maximising sales revenue
Maximising shareholder revenue
Other, please specify: ___________________________________________________________________________________________________________________________________________________________________________
6. Using a scale of 1 to 5, with 1 being the least and 5 the greatest, assess the relevance of the following limitations of the above objectives to your firm.
Maximising profits:
Focus on profits in the short-term increase competition and threaten long-term survival. ____
Constant changes to price and output in an effort to maximise profits deter consumption or decrease demand. ____
Growth:
Rapid expansion may cause cash flow problems. _____
Larger businesses can experience diseconomies of scale _____
7. Definition: MBO - Management by Objectives – This refers to a system where the objectives of the firm are not only written but used in every day life on the job. The system allows for individuals to compare their performances to the goal and eliminate performance gaps.
Is this system implemented in your organisation?
Yes No
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8. In your opinion, does it motivate employees?
Yes No
For questions 9 to 12, on a scale of 1 to 5, where 1 is the least and 5 the greatest, assess the impact, relevance of the following where your organisation is concerned.
9. Which of the following exist within your firm?
Frequent consultation with employees ____
Trust ____
Retraining facilities _____
Clear objectives _____
10. Which natures of change does your business have to cope with?
Political (Government intervention and protection) _______
Economic (the external economic environment) _______
Social (societal structure) _______
Technological _______
Legal (regulations) _______
11. Within your firm, what are the reactions to change?
Acceptance ______
Resistance (passive) – non-learning behaviour ______
Resistance (active) – slowing down; sabotage ______
Indifference – lack of interest, care or concern ______
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12. Which of the following do you think account for the various reactions to change in your firm?
Fear – whether of job loss or increased work load ______
Dissolution of groups – being sent to a different department ______
Inability to adjust ______
Loss of power _______
Misunderstanding the nature of the change ______
13. In which of the following ways does your organisational culture promote change? Through:
Education
Communication
Participation
Other, please specify:___________________________________________________________________________________________________________________________________________________________________________
14. In which of the following ways does Management motivate employees to accept positive sides of change?
Clarify intentions
Group discussions
Demonstrations
Other, please specify:___________________________________________________________________________________________________________________________________________________________________________
15. On a scale of 1 to 5, where 1 is the least and 5 the greatest, rank the suitability of the following to the communication system implemented in your
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organisation.
Feedback to assess change _____
Investors and shareholders ONLY to be briefed on change _____
Messages to be as clear and precise as possible _____
16. In which of these circumstances is finance (capital) required for your firm?
Expansion
‘Buying out’ other firms
To pay for expenses
Research and development
Other, please specify:___________________________________________________________________________________________________________________________________________________________________________
17. Are your financing needs mainly short-term (1 year or less) or long-term (1 to 5 years)?
______________________________________________________________________________________________________________________________
18. Which of the following ways was start-up capital acquired?
Personal savings
Banks
Investments by venture capitalists
Government agencies
19. How is working capital acquired?
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Overdrafts
Creditors
20. Using figures from a previous Acid Test Ratio, describe the business’ liquidity.
Excellent – 3:1 and up
Good – 2:1
Fair – 1:1
Poor – less than 1
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Appendix (C) - Statement of Findings
Module 1: Business ObjectivesThe aim/vision of this firm:
“The Transport Board shall be an exemplary transportation institution, exhibiting the
highest standards of excellence and contributing to the social and economic landscape
of Barbados and in so doing assist in the sustainable development of the nation”.
The mission statement of this firm:
“To be the principal provider of safe, reliable, and efficient mass transit services and
to consistently deliver the highest level of customer satisfaction to users of public
transport in Barbados”.
The objectives of this firm:
The objectives are only relevant to the needs of the organisation. These include:
Growth
Increased market share
Two great limitations of their growth objective are that:
Rapid expansion may cause cash flow problems.
As a larger business, they can experience diseconomies of scale.
However, the Management by Objectives system is not implemented in the Barbados
Transport Board.
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Module 2: Management of ChangeFactors which affect Change:
It was found that all of the following existed within the firm but, at different levels.
1) Consultation with employees is moderate.
2) Trust, clear objectives and the presence of retraining facilities are at a very
low level.
The nature of Change:
This business is impacted on by several different factors causing change but, at
different levels.
1) Political change - government intervention and protection – has a very high
impact on the Transport Board.
2) Economic – the state of the external economy – has a moderate impact on the
Transport Board.
3) Social, technological and legal natures of change have very little impact on the
Transport Board.
The reactions to Change:
Within the Barbados Transport Board, employees react to change in four (4) different
ways.
1) Acceptance is very low
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2) Passive resistance is high
3) Active resistance is very low
4) Indifference is very high
Management believes that there are several reasons for this behaviour by employees.
1) Fear of job loss and increased work load
2) Dissolution of work groups
3) Misunderstanding of the nature of change
4) Loss of power
5) Inability to adjust
Also, communication is the method by which the firm’s organisational culture
promotes change. As a result, management motivates employees to see change as
positive by:
Clarifying intentions
Group discussions
The type of communication system implemented in the Barbados Transport Board
allows for:
Messages to be clear and precise
It however does not allow for feedback to assess the change or for investors and
shareholders ONLY to be briefed on change.
Module 3: The Need for FinanceFinancial Requirements:
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The Barbados Transport Board requires finance mainly to pay for expenses. Such
needs are short-term as they last one year or less.
Start-up and Working Capital:
Start-up capital was acquired solely through Government financing. Working capital,
however, is acquired by overdrafts.
When assessing the firm’s liquidity, it was found that its ratio was poor because the
firm has less than $1 in assets for every $1 in liabilities.
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Bibliography
Jewell, B (2000). An Integrated Approach to Business Studies. Pearson
Education Limited.
Marcousé, I., Suridge, M & Gillespie, A (2003). Business Studies for A
Level. Oxford Designs and Illustrations.
Singh, K & Stimpson, P (2007). CAPE Management of Business Unit 1.
Cambridge University Press.
Dearden, C & Foster, M (1993). Organisational Decision Making. Longman.
http://en.wikipedia.org/wiki/Public_good Retrieved April 21, 2009.
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