3. Consider the management of resources

3.1

In this unit I will investigate the following subjects throughout 4 tasks, which will finally result in the understanding of business and management in a certain business which in this case is Boots. The learning outcomes are as follows –

Explore the role of management in achieving organisational aims and objectives.
Investigate the role of management in improving business performance.
Consider the management of resources
Examine the nature of key management skills

The learning outcome that I will investigate in this report is to consider the management of resources. It is crucial to monitor all resources within a business to ensure that management is aware of every operation and is aware of any risks that could have a detrimental effect on the business. The four main resources that need to be monitored are –

Physical Resources
Human Resources
Financial Resources
Technological Resources

I am going to describe, in depth all of these resources and why if they are followed it will result in the business being effectively managed.

3.2

Physical Resources

Physical resources cover a wide range of resources including –

Buildings and facilities – it is crucial that managers at boots ensure that the building premises are maintained as a credible environment for both the staff to work in and for the consumer to see the business as a clean and well kept organisation. If the building is left to deteriorate, then it will give a negative effect on the business which could result in loss for the business.

Materials and waste –Boots don’t want waste. Waste=Cost and therefore a boots needs to ensure that waste is minimal and physical resources are in place to help recycling which is cost effective and environmentally friendly. Boots have recycling schemes in place and they mainly recycle merchandise. By Recycling merchandise, they made donations to over 2,000 community-based projects last year.

Plant & Machinery – like the premises, it is crucial that these are maintained well. Not just for the superficial exterior but for the actual quality of the machinery to ensure that everything is working to its best ability and is keeping output high.

Equipment – Equipment can include things such as I.T resources i.e. computers. Computers are crucial in boots, they are the brain of a company and without it they would seriously struggle. Therefore as part of physical resource management, computers should be regularly checked to make sure they are up to date and are running efficiently.

Maintenance & Refurbishment – premises or buildings can become dirty or things could break. For this reason there are people solely employed at boots to keep on top of maintenance and refurbishment. They would be in charge of fixing broke things and doing things such as painting, decorating etc.

Emergency Provision – Boots will have an emergency plan. In a big business, all employees will be aware of things such as a meet up point when they have gotten out of the premises in cases of a fire. It also includes the manager being responsible for the installation of things such as fire alarms and sprinkler systems.

Insurance – insurance is very important. It is a massive market within the UK with everyone having insurance on things from their cars, homes, life to things such as body parts. In terms of boots, insurance must cover the staffs wellbeing whilst working there and insurance in case of fire or damage on the building.

Security – in any business, especially a high street store like Boots, security is essential. There are thieves everywhere in the world and no business is safe. Therefore the only thing a business can do is put security measures in place such as CCTV and security guards to minimise theft, because like waste, theft=cost to the business

Physical resources is basically the management of anything physical within the business and also ensuring that there are plans in place to ensure that things cannot go wrong in terms of these resources. For this reason managers in business should have a plan in place called a contingency plan. A contingency plan is a plan that prepares for things that could happen that have serious threat to the business. This could include things such as fire, terrorists, bombs etc.

In terms of Boots then a contingency plan might be put into place for the threat of a certain store having to close for a considerable amount of time due to essential refurbishment or it being dangerous to the customers and staff. This contingency plan would outline things such as – will a temporary store be opened for the customers still wanting to shop at Boots? Would the store be able to be transferred to a portacabin for the duration of the work so that it doesn’t cause massive loss in profit and customer numbers for the business.

3.3

Human resources

Human resources is a huge functional area within a business. it is more sensitive than other resources within a business because it deals with humans within the business and not actual material resources that don’t need to be dealt with such much care. Human resources covers many areas including –

Recruitment and retention

This is a preview of the whole essay

3.3

Human resources

Recruitment and retention

The first area of human resources is to actually recruit the staff. When employing people, you need to know exactly what the person is required to do. This way there will be no confusion. A job description will describe what there responsibilities will be, who will be there manager and what skills they will be required to have to carry out the job that they are applying for. The firm can then write a personal specification for the type of person that they want for the job.

There are many different ways that a business can attract new staff to the business. An advert isn’t the only choice that can be taken. Another method of finding potential candidates is to use a job agency. There are a large number of them who have sites on the Internet. One example is ().

Recently, the number of business that offer on-line job application has soared. Boots offer an online form that potential employees can fill in in hope to get a job. This is much faster than other methods such as post or handing the application form into a box in Boots. Other benefits of online recruitment includes –

It is possible to monitor how many people visit the site
See how many people from this that then go on to apply for the job
Able to breakdown the applicants more efficiently and accurately for example – gender, sex, race. This then helps conform to equal opportunities legislation

Another way that a business may test potential employees is through an actual test. It is known as psychometric testing and allows the business to get an insight into the true applicant and whether they would be good for the business. There are two main types of psychometric tests –

Ability testing - Ability tests measure a persons potential, for instance to learn the skills needed for a new job or to cope with the demands of a training course.

Aptitude testing - There is no widely accepted definition of the difference between ability and aptitude. Most people would agree that to some extent the two terms refer to the same thing: aptitude referring to specific ability, and ability referring to general aptitude.
ref.

Retention

Boots are keen to retain good staff. This saves them the cost of hiring another employee and retraining them and also saves time. The company usually carries out certain programmes that would enable them to keep their staff and save them money. Boots want to make sure that their staff are satisfied with their job and carry out induction days to help make sure that all of their staff is ready to work to their full standards and enjoy their job enough to stay loyal to the company. When boots is trying to make sure that their staff is satisfied they take into consideration certain points

Whether the job is interesting – if not the employee could get bored and go elsewhere
Having responsibility – if the employee feels they are not trusted with the appropriate responsibility they may not feel wanted and leave
Being praised – Praise allows the person to feel wanted and happy in their job
Being able to achieve – knowing that doing their job will allow them to achieve different things in their life will give them something to aim for therefore they will stay at the company longer
Personal growth/ opportunities for advancement – knowing that doing the job you are doing now well will allow you to get promoted to a higher position in the future with higher pay is a good incentive to keep working in the business

Boots were in crisis recently when they were finding it hard to retain qualified pharmacists for the business. Therefore boots started recruiting pharmacists from abroad about 18 months ago. The company has been on several recruitment visits to both Spain and South Africa and is planning to return to both countries later this year. Boots used “unique circumstances” as the reason behind this recruitment drive. Human resources would have been responsible for the decision to seek recruitment elsewhere.

The main objective of the Human Resources is to attract the right quality of people at the right number. Boots continuing success could not be achieved without the good work of its employees and Boots has been very successful at recruiting the right candidates. However if the wrong person is chosen for the job it will cause problems for the company so Boots takes this area very seriously and always tries to employ employees that are right for the job. If the wrong candidate is selected for the job it causes problems such as he might find the job to difficult and decide to leave or be forced to leave and this will add to administration costs. Also Boots will face extra cost of advertising, interviewing and training a new candidate.

Boots believe the most suitable applicant will only be chosen if selection is based on ability, skill and knowledge rather than race or gender. Boots is always fair when recruiting candidates.

Human Resources also deal with things such as company policies that are outlined to the employee when they start. These policies include things such as disciplinary procedures and grievance procedure. The two are relatively the same however are taken out by different people. A disciplinary would be taken out by the manager towards an employee if they don’t comply to business rules and conditions or are not working to the best of the ability. However a grievance procedure is the other way around and is the employee taking it out on the manager. Basically a grievance procedure could be used if an employee feels they are being treated unfairly but is sometimes used to argue against a disciplinary procedure if the employee doesn’t agree with it.

Monitoring staff is crucial in human resources. If staff weren’t monitored then boots would never know things such as sickness and absence rates and lateness levels. If an employee is sick or absent from work then it can cause business operations to be uncompleted, this could result in missed deadlines and even loss for the business. It is therefore very important that accountability for all staff is in place. It will allow the business to monitor levels of lateness and sickness and more importantly any patterns that may occur for example a certain member of staff being off on the same day for a series of weeks or months.

Professional culture is also part of human resources. The way businesses run can vary, they all run the way that the manager wants them to run and in a way that suits the business activity. Professional culture can be defined as to the way that managers deal with staff and respectively how staff deal with managers. This is mainly in the way that the two interact with each other and the language used. Some businesses insist on people being referred to by Mr., Miss, Mrs. and their surname. This is very formal and can create barriers in-between staff and managers because it is too formal. In terms of Boots, everyone is called by their first name which is labeled on their name badge. If a certain manager wants to be called Mrs. or Mr. and their surname then that is their own prerogative as it is their choice how they run the business.

As part of the business professional culture, some businesses want their employees to keep all of their private lives separate from their business work. While this can help improve work output, it also prevents employees getting to know each other and having good teamwork. For this reason most businesses are relaxed to a degree, which ensures that teamwork is good but employees still get on with their work.

Teamworking can be a very good thing for a business. if employees pull together then it could improve the workforce as a whole and even improve the work being done. Teamwork can be encouraged through incentives such as –

Bonuses
Prizes

Teams can be put together and given targets to help them work well. By having numerous teams then the manager can easily monitor the success of each team and notice poor results and then take action against the ones who are underperforming.

Keeping one step ahead is important. The structure of a business allows different levels to monitor performance and co-ordinate teams. This monitoring could include –

Team meetings to monitor if targets are being met in that department
End of year reviews that can take place with representatives from each functional area showing their results.

Culture of change

Change is the reason that many companies are outmaneuvered by competition within their market. If a business isn’t aware of change then they are at risk of not succeeding in making a profit. A big change in today’s society is the internet. When the internet was introduced it held so many opportunities, one of these is internet shopping. In today’s world most high street stores including Boots have websites that allow the customer to order Boots products or whatever they sell through the internet in the comfort of their own home and delivered direct to their door. If a business didn’t take note of this change then they would be seriously behind the times and wouldn’t be making the most potential profit. It is therefore essential that a business is adaptable to the culture of change. Two ways that a business can become more adaptable include –

Becoming more creative
Have initiative

By encouraging employees to develop new ideas it is likely that the business will improve as a whole and become more successful.

Another resource that needs to be monitored closely is health and safety.

It is essential that a working environment is safe to work in and is not hazardous to anyone working within that environment. Things that need to be monitored include –

Making sure the floor isn’t slippy
Providing ergonomically designed chairs for staff who constantly sit at a computer.

A business has guidelines to conform to in terms of health and safety. They are outlined in the Health and Safety at Work Act 1974. The ‘Health and Safety at Work Act 1974’ sets out the general duties and responsibilities that employers have to their managers and the general public, and those that employees have to themselves and each other. The ‘Workplace (health, safety and welfare) Regulations 1992’ gives more specific details about the responsibilities imposed on employees of employers under HASWA. These regulations must be displayed clearly in a noticeable place in the workplace. If they don’t it can cause the company or school to be fined. An inspector working for the Health and Safety executive (HSE) can inspect a companies workplace at any time without warning top investigate a complaint or inspect the premises to make sure everything is in place. If the inspection proves negative they are issued with an Improvement Notice, which gives a specific time in which they should improve the things mentioned that are wrong. If the workplace is bad enough that the workers are at risk the company is issued a prohibition Notice that allows the employees to stop working immediately. The employer can appeal for the notice to be removed. But if the appeal fails and nothing has been improved they can be fined or imprisoned.

It isn’t just slippy floors and chairs that need to be monitored in terms of health and safety. It is also essential that a proper fire drill is organized and is understood by all employees so that in the case of a fire, they all know the correct procedures to follow to get out safely. As part of this procedure it is also a legal requirement that there are fire doors installed and properly labeled to allow quickness of exit.

If health and safety isn’t effectively managed then it can have fatal effects on the staff of the business. they could be seriously injured or even killed which is obviously bad for the employee and their family but can also signal an investigation of the business which could result in them being fined or closed down.

3.4

Financial Resources

Financial resources are essential within any business. Without money a business cannot run. Money is crucial and without it a business would fail. The resourcing of finance involves –

Bidding for future resources
Making sure the business is financially sound
Keeping appropriate reserves – i.e. a fund for if the business has to buy emergency stock or equipment

Without money a business couldn’t carry out any of its business activities. It couldn’t –

Produce new products
Buy new stock
Build new premises
Employ new staff
Retain staff – they may have to make some redundant

If a business is running efficiently and making a profit then finance for the building of new stores or buying new stock can be sourced from this profit. However if a business is struggling and want to try a new venture for example opening a larger store in a different area then there are other ways of obtaining finance. These include –

Grants - Financial aid that does not need to be repaid, usually awarded based on need, but can be awarded for special skill, talent, heritage, or other criteria such as benefiting the local community.
Loans - A loan is a type of debt. It involves a borrower (boots) initially receiving an amount of money from the lender, which they pay back, usually but not always in regular installments, to the lender. This service is generally provided at a cost, referred to as interest on the debt.
Investments - Investment refers to the accumulation of some kind of asset in hopes of getting a future return from it. A business may invest in boots in hope to gain money; boots can use this money to expand.
Sponsorship – This involves supporting boots, in an activity or just the company in general. It involves a business or company lending boots money to fund a certain event or just providing money if boots are in need of funding. This is usually in return for advertising space in boots publications or events.

A business strives to make a profit and also to be liquid. By liquid it means that the business has a steady access to finance that will enable them to pay any debts or expand the business. to be liquid the business needs to be making a profit. If a business isn’t making a profit then it could cause the business to cease trading and operating because they don’t have enough money to pay their debts. For this reason, like physical resources and human resources, a contingency plan is put into place for financial resources. It acts like a reserve of money for the business; they can use this money to pay for any unexpected expenses that they hadn’t accounted for. If this money wasn’t saved back then they would be at risk of closure. These unexpected expenses could include things such as –

Electric, gas, water bills being higher than expected due to the costs being heavily increased.
Tills becoming outdated within a store. The introduction of chip and pin has caused massive costs to stores across the country because whole new systems have needed to be installed with the till points. Business hadn’t predicted how big chip and pin would be and therefore didn’t expect the cost of it.

3.5

Technological resources

Technological resources do not include the actual technological hardware and equipment such as computers as it may be expected. It includes things such as

Software
Designs
Music
Text

It is therefore basically the property that the business has created that they now own. It is known as intellectual property or IP. IP is a kind of protection for the things that the business has created or designed and allows for it to not be copied by any other business. this creates exclusivity for the product and makes it the only option for the customer to buy the product if it were to go on sale, allowing for a higher price to be put on the product. IP is proved through a record of some sort, sort of like a certificate that proves where the design was thought of, ensuring it can’t be copied. This can be done in numerous ways including –

Copyright - This exists in creative and artistic works (eg. books, movies, music, paintings, photographs and software), giving a copyright holder the exclusive right to control reproduction or adaptation of such works for a certain period of time.

Patent - This may be granted in relation to an invention that is new, useful and not simply an obvious advancement over what existed when the application was filed. A patent gives the holder an exclusive right to commercially exploit the invention for a certain period of time (typically 20 years from the filing date of a patent application).

A Trademark – This is a distinctive sign which is used to distinguish the products or services of one business from those of another business. For example the Boots logo known as the Boots script is a trademark used on all Boots products and could not be used by any other businesses.

These technological resources do not all necessarily apply to Boots but they are all crucial to any business in terms of the protection they give. Also, if Boots were to design their own revolutionary product, like no other on the market then they could take out a copyright or patent to ensure that their idea isn’t copied.

Another area of technological resources includes the retention of well skilled employees and managers. Over the years a business can accumulate a good team of employees with good experience and skills. Experience is crucial in any business and the more experienced a staff member is the better they are at doing their job. To ensure that these staff are retained a business can do thing such as pay them a good wage in return for their experience and skills and also give incentives such as bonuses, prizes etc.

Without experienced staff working in the business then there will be only limited knowledge, thus causing the business to not run as effectively. For example if Boots Saturday staff are just made up of in experience part time staff that only work four hours a week then there is no-one to give these people direction. This inexperienced attitude and atmosphere will pass onto the customer who will not feel that they are being helped by some one who knows what they are doing.