People

Overview

The 'People' topic is a core component of GCSE Business Studies, exploring how businesses manage their most valuable asset: human resources. Examiners expect you to understand how organisational structures, recruitment processes, motivation theories, training, and employment law impact business performance. Crucially, top marks are awarded not just for knowing these concepts, but for applying them to specific business contexts provided in the exam stimulus. Whether it's a small local bakery or a multinational corporation, your ability to tailor HR strategies to the scenario is key.

Organisational Structures

Businesses need a structure to define roles, responsibilities, and the chain of command. The two primary structures you must understand are Tall and Flat.

Tall Structures

Key Features: Many layers of hierarchy, narrow span of control (e.g., 2-3 subordinates per manager), long chain of command.

Impact on Business: Communication can be slow as messages pass through many levels. However, there are clear lines of supervision and numerous promotion opportunities for staff.

Flat Structures

Key Features: Few layers of hierarchy, wide span of control (e.g., 6-10 subordinates per manager), short chain of command.

Impact on Business: Communication is faster and decisions can be made more quickly. Employees often feel more empowered and trusted, though managers may become overloaded with too many direct reports.

Recruitment and Selection

Finding the right people is critical for business success. The process involves identifying a vacancy, creating documents, advertising, shortlisting, and interviewing.

Job Description vs. Person Specification

• Job Description: Outlines the duties, responsibilities, and tasks involved in the job.
• Person Specification: Details the qualifications, skills, and experience the ideal candidate should possess.

Internal vs. External Recruitment

• Internal Recruitment: Hiring from within the existing workforce (e.g., promotion). It is cheaper, faster, and the candidate already knows the business culture. However, it leaves another vacancy to fill and doesn't bring in new ideas.
• External Recruitment: Hiring from outside the business. It brings in fresh perspectives and a wider talent pool, but it is more expensive, takes longer, and carries a higher risk of the candidate not fitting in.

Motivation Theories

Motivated employees are more productive, provide better customer service, and are less likely to leave the business. You need to know three key theories:

1. Taylor (Scientific Management)

Frederick Taylor believed workers are motivated primarily by money. He advocated breaking jobs into small, repetitive tasks and paying workers based on their output (piece-rate pay). This works well in manufacturing but ignores social and psychological needs.

2. Maslow (Hierarchy of Needs)

Abraham Maslow proposed that people have five levels of needs: Physiological, Safety, Social, Esteem, and Self-Actualisation. A business must satisfy lower-level needs (like a basic wage) before higher-level needs (like recognition) can motivate the employee.

3. Herzberg (Two-Factor Theory)

Frederick Herzberg identified two sets of factors:

• Hygiene Factors: Pay, working conditions, job security. These do not motivate, but their absence causes dissatisfaction.
• Motivators: Achievement, recognition, responsibility. These actively drive performance and satisfaction.

Training and Development

Training improves employee skills, leading to higher productivity and better quality work.

• On-the-Job Training: Learning while performing the role (e.g., shadowing an experienced colleague). It is cost-effective and directly relevant, but bad habits can be passed on, and mistakes might impact customers.
• Off-the-Job Training: Learning away from the workplace (e.g., at a college or training centre). It is usually delivered by experts and allows focused learning, but it is expensive and the employee is away from their normal duties.

Employment Law

Businesses must comply with legislation designed to protect employees:

• Equality Act 2010: Protects workers from discrimination based on age, gender, race, disability, etc.
• National Minimum Wage Act: Ensures employers pay a legal minimum hourly rate.
• Health and Safety at Work Act 1974: Requires employers to provide a safe working environment and adequate training.

Revision Podcast

Listen to this 10-minute podcast for a comprehensive review of the topic, including exam tips and a quick-fire recall quiz.