Business Organization and Management: Structures, Functions and Motivation
Core concepts
This area covers forms of business ownership (sole proprietorship, partnership, company, cooperative), business environment, and management functions: planning, organizing, staffing, directing, and controlling. Understand organizational structures (line, line-and-staff, functional, matrix), span of control, delegation versus decentralization, and motivation theories such as Maslow's hierarchy and Herzberg's two-factor theory.
Traps to watch
Questions often blur delegation with decentralization: delegation is between a superior and subordinate, while decentralization spreads authority across the organization. Distinguish authority, responsibility, and accountability. In motivation questions, hygiene factors prevent dissatisfaction but do not motivate; motivators drive satisfaction. Also separate management functions from managerial roles and skills.
Worked example
A manager gives a subordinate a task with the power to approve expenses up to a limit but retains final accountability. This is delegation of authority with retained accountability. Rule of thumb: authority can be delegated, responsibility can be assigned, but accountability cannot be delegated; the delegator remains answerable.
Strategy
Memorise frameworks as lists with one defining feature each, then apply them to short scenarios. When a question describes a situation, identify the function or concept that best fits the described action rather than the job title.