Management and Business Environment
Management fundamentals
Know the classical functions - planning, organising, leading and controlling - and be able to map them to a manager's day. Add Mintzberg's roles (interpersonal, informational, decisional) and Katz's skills (technical, human, conceptual, shifting in weight with managerial level). Then cover leadership: trait, behavioural, contingency (Fiedler), situational (Hersey–Blanchard) and transformational approaches. On motivation, be precise about Maslow's hierarchy, Herzberg's two-factor theory, McGregor's Theory X and Y, Vroom's expectancy theory and Adams's equity theory. Also revise delegation, span of control, centralisation versus decentralisation, and organisational structures (functional, divisional, matrix, network).
The environment
Use PESTLE for the macro environment, Porter's five forces for industry attractiveness, the value chain for internal activity analysis, and SWOT to synthesise. Stakeholder mapping (power/interest grid) and the micro versus macro distinction are frequently examined, as are globalisation, corporate social responsibility and business ethics.
Traps examiners use
- Herzberg: salary, working conditions and supervision are hygiene factors; their absence demotivates, but their presence does not motivate. Only achievement, recognition, responsibility and growth motivate.
- PESTLE is macro only - competitors, customers and suppliers belong to the micro/industry layer.
- Five forces assesses an industry, not a single firm's strengths; that is what SWOT's internal half does.
- In SWOT, strengths and weaknesses are internal; opportunities and threats are external.
- Motivation theories describe different things - needs (Maslow), work content (Herzberg), assumptions about workers (McGregor), and cognitive choice (Vroom).
Rule of thumb
Classify any factor in three steps: inside the firm → SWOT internal; outside but specific to the industry → five forces; outside and affecting everyone → PESTLE. A new competitor's price cut is therefore a five-forces event, while a change in the central bank rate is a PESTLE event.