Business Organisation Notes for the Leaving Certificate

Industrial Relations Notes

1. History- social classes, lack of worker rights and abuse, Tolpuddle Martyrs leading to social change and legalisation of TUs'.

2. Union Organisation- shop steward, National Executive, General Secretary and elected President, ICTU. Benefits for employers- communication and clarity. Union role-
· Negotiation,
· Advice,
· Services(eg pensions, group scheme ins),
· Job Security,
· National Voice(national pay deals).
Types Industrial, White Collar, General, Professional

3. Causes of Disputes-
· Conditions
· Dismissals
· Discrimination
· Redundancies
· Pay Claims: cost of living, comparability, productivity, relativity
· Demarcation

4. Industrial Relations Act 1990: official disputes(secret ballot, 1 weeks notice, confirmed by ICTU) union can't be sued by employer for loss of profits, injunction won't be given if strike is legal,, unofficial (non union backing or legal immunity), illegal (if strike for political reasons, enforcing closed shop or against policies of management)

5. Industrial action-
· Work to rule - no extra duties outside employment contract
· Go slow - bare minimum of work without breaking contract
· Token Stoppages
· All Out Strike
· Pickets - must be peaceful and no obstruction, not outside employers home, Secondary only ok if second employer is helping first
· Sympathetic Action
·Overtine Ban
·General Strike

6. Outside Agencies - LRC, Labour Court, Equality Authority, EAT
LRC aims to improve Ind Rel by
· intervening if negotiations fail
· developing Codes of Industrial Relations Practice
· Advising firms and workers on IR law and practices
· Equality Officers - investigate discrimination
· Rights Officers - one or few workers, conditions not pay or hours

Labour Court - court of last resort, only where LRC has failed or where asked by Minister of Enterprise and Employment
· Main duties - Conciliation and Arbitration
· Other - registration of agreements to make them binding, establish JLC (Joint Labour Committee) in non unionised companies, assist JICs' in creating non binding agreements
Equality Authority - employers conform to anti Discrim laws
· Advise employers
· Monitor implementation of legislation
· Investigate complaints
Employment Appeals Tribunal - firms conform to Unfair Dismissal Acts, ie no dismissals due to : gender, race pregnancy, union membership religious or political opinions. Compensation up to 2 years salary

Heath and Safety Authority

7. National Pay Deals - tripartite, leading to lower inflation, less strikes, control of the National Finances, better planning by all, stronger economy, better Ind Rel



1 Choice of form of business depends on size, finance, risk, control, etc.

2 Sole Trader: Advantages-easy decision making, motivation to work, easy to set up. Disadvantages: overdependence on one person, less finance available, risk, pay higher tax-top personal rate rather than corporation tax rate.

3 Partnerships: business where 2-20 people combine their abilities and finance with a view to making mutual profit. Usually rules laid out in Partnership Deed, if not implied even split of duties, etc. Usually unlimited liability though Junior Partners, Sleeping Partners, etc.
Advantages: more finance, more expertise, better decision making.
Disadvantages: Difficult to get borrowed finance, differences of opinion/personality clashes, more formal and less flexible than Sole Trader, unlimited liability.

4 Private Limited Companies: registered under the companies acts as Limited, 1-50 shareholders, shares transfered by agreement of other shareholders, information must be publically available.
Establishing Private Ltd. Co.: Promoters send documents to Co.'s office: (1)name registration, (2)Memo of Assoc (name, reg office, objectives, auth sh cap,ltd liab statement), (3)Articles of Assoc (appointing directors, meetings, transfering shares, duties of directors), (4)Declaration of Compliance with Companies Acts, (5)Statement of Authorised and Issued share capital, (6)list of directors. When those are agreed by Companies Office a Certificate of Incorporation is issued and trading can begin. Advantages: Ltd liability, more finance, continues after death of owner, professional managment. Disadvantages: harder to set up, less flexible decision making, publication of accounts loses confidential info.

5 Public Limited Companies (PLC's): at least 7 shareholders, same certs but Trading Certificate for Stock Exchange. Running companies- meetings, AGM, EGM, quorum, statutory (1st meeting), voting by proxy, casting vote. Debentures: indenture, pref and ord shares, at premium, Prospectus, using merchant bank to underwrite. Directors: reckless trading becomes Restricted, Shadow Director (major creditor influencing board decisions), Executive (part time, experience, skills, etc), Non-Executive (politicians, etc, for image).

6 Company difficulties - court hearing, possible results: (a) Inspector to look for wrong doing, (b) Liquidator to sell off, (c) Receiver to wind up or make viable, (d) Examiner to see if company can be saved. Winding up : voluntarily or compulsory.

7 Co-Operatives: one person one vote, shared profits, shared effort. Service - artists, taxi drivers, Production, Agricultural, Fisheries. Must be registered with the Registrar of friendly societies to get limited liability. Many now changing to Plc's to get extra finance to expand. Adv's: Ltd liab can be got, motivation, Disadv's: managed by popularity not skill, one vote no matter how many shares.

8 State Ownership: reasons for- (a) national need (b) high capital investment (c) control monopolies (d) protect employment (e) national promotion eg. Bord Trachtala, Bord Failte.

Growth of Firms

· Business environment is dymanic- stand still and you die. Competition, technological change, increased consumer demand and lack of loyalty.

· Business Life Cycle- research, launch, growth, maturity, next?

· Need for Expansion: A. defensive- guarantee supplies, ec of scale, reduce unit costs, diversification, improve ability to survive downturn. B. offensive - get rid of comp, acquire new products/patents/ideas, profits, better able to handle new opportunities. C psychological -image, ego, self actualisation

· 2 distinct ways of growing- A organically by finding new or existing products, B inorganically by alliances, t/o s' and mergers

1. Access to more existing products/ideas: eg sales expansion, import distribution agencies, franchising, licensing your own products abroad,
2. New products- high R+D costs but potential patent benefits
3. Strategic Alliances- eg Ryanair + Hertz,
4. Mergers
5. Takeovers
6. Subsidiaries(>50%), Associate Co(>20%), Holding Co, Conglomerate (diversified Holding co), diseconomies of scale.

· Advs and disadvs of Expansion to the different stakeholders.

· EU Competition Law: approves large T/Os' and mergers to allow free competition

· Irish Competition law: Competition Auth (1991 Competition Act) must be informed if >50% market likely from a merger or T/O. Monopolistic, Cartels, Price Fixing, Restriction of Production, Blocking entry to a Competitor, etc

International Business

1. Ireland operating in a global marketplace. History from setting up the state, development of consumer information, WWW, etc.
2. Flows into and out of an economy, Balance of Trade, Balance of Payments, visible and invisible, link to Economic Growth.
3. Barriers to foreign trade: tariffs, quotas, bureaucracy, embargoes, subsidies
4. Reasons for free trade (sales, sourcing materials, efficiency, international relations, consumer choice) and protectionism (jobs, prevent dumping, protect culture). Trading blocs( NAFTA, OPEC, EU, ASEAN), WTO
5. Globalisation: one market regardless of culture, language, etc, location of industries, lack of loyalty of Multinationals, resistance groups, etc, economies of scale, deregulation(remove govt rules). Global Marketing mix: 4ps' standardised or adapted to local conditions
6. Difficulties in Exporting: cultural, start up costs, language, payments, political uncertainty.
7. State assistance: Enterprise Ireland (help develop export markets, get ideas across), Bord Trachtala (Irish Marketing Board), Dept of Enterprise and Trade, Dept of Foreign Affairs (Embassies, Consuls), organising trade fairs, trade missions
8. TNCs': production and marketing in diff countries, production sharing, Conglomerates, Holding Companies, Transfer Pricing (valuing output between elements to minimise tax). Reasons for TNCs': need for new markets, Economies of Scale, better transport and communications. Why locate in Ireland: tax incentives, grants, access to EU, trained workforce, we speak English. Pro's and cons of TNC's



1 Definitions: Marketing and Advertising, connections

2 Product Life Cycle-intro, growth, maturity, saturation,decline, Churning & Harvesting, sales, adv., profits, product mix

3 Developing ideas: essential to the long term survival of any type of organisation-club, school, etc.
-internally: brainstorming,salespeoples comments, R&D, customers, product churning, product covering (copying competitors), parallel development (new generations of existing products, intrapreneur to motivate, create the environment for the creation of ideas.
-externally: reacting to compeditors products, exhibitions, magazines, street trends.

4 Marketing process- generating ideas, screening crap ones, formulating the concept, feasability study, prototype, test marketing, research, SWOT analysis.

5 Marketing Research- desk: primary- for this purpose- secondary: for general use, eg census
field: observation, interviews, questionnaires, judged on cost, accuracy and response.

6 Sampling- group used to represent the population as a whole, divide pop into subgroups and find similar samples, social divisions, researcher's impartiality: rndon, cluster, quota.

7 5 P's-product, price, place, promotion, packaging. Marketing mix, price- discrimination, compeditors, quality statement, product age, etc.

8 Types of Advertising- Informative, Comparitive,Persuasive, Global, Generic, Reminder, Subliminal, Corporate

9 Sales Promotion and Merchandising

10 Public Relations- PRO, press releases, free advertising, exhibitions, complaints procedures, customer loyalty,repeat business.

11 Other terms- ASAI, codes of advertising practice, consumers charters (UK), Image, brands, logos, copyright, patent, intellectual property, trade marks.


1 definition of Management: arranging the organisation to get profit out of the enterprise idea(vs enterprise)

2 characteristics of the Manager: charisma, focused, ability to see a plan through, motivator, co-ordinator, planner,

3 Management Skills: leading, motivating, communicating
a. LEADING: get results done, knowledge needed, decision making, mission statements,Autocratic, Democratic and Spectator managers
b. MOTIVATING: Mc Gregor (X and Y theories), Mazlow's hierarchy of needs (physiological, security, social, self esteem, self actualisation)
c. COMMUNICATING: verbal, non-verbal, visual, electronic, internal, external.
Factors to consider- cost, accuracy, speed, confidentiality, reliability CASCR
Barriers to effective communication (noise interference,assumptions incorrect, organisational attitudes, lack of planning, not assessing the receivers), break even charts, meetings (minuites, agenda, etc.), reports

4 Management Activities: planning, organising, controlling
a. PLANNING: general + specific objectives-mission statements
b. ORGANISING: structure, staffing (HRM), delegation, decision making
c. CONTROLLING: stock, credit, quality- do they meet targets?

5 Management Organisations-
Chambers of Commerce
Trade Associations

6 Modern management - changing as a result of
· Technology esp IT, eCommerce, eBusiness
· Global nature of business
· Larger Businesses, MNCs', Transnational Organisations
· Increased need for flexibility and adaptability to change
· Worker morale

7 IT in Business
· Teleworking
· EDI - less paperwork
· eCommerce and the eBusiness Enterprise
· Product design and manufacture

8 Creating Morale during changes
· Job Rotation
· Staff training and outside education
· Communication
· Staff participation in managing change, delegation
· Move away from the traditional Functional structure of management to a Team/Project structure

9 Quality Control in today's competitive marketplace
ISO 9000 (international) or Q mark (Irish) standards

10 Total Quality Management -
Each staff member is encouraged to provide the best quality service to their own end user. Tools include:
· Recruitment of motivated staff
· Incentives incl profit sharing
· Leadership
· Education and training

11 Japanese Management - Quality Circles: staff groups from all levels meet to discuss problems, etc


1. Intro: HRM = managing the staff resources of organisation to ensure we have the right staff doing the right jobs at the right wage level. HR planning/ manpower planning = identifying future needs. Done by HR forecasting + current HR audit

2. Recruiting: " Assess needs incl future needs - Job Description incl hours, duties, responsibilities, etc " Advertise including essential specifications of person sought " Assess responses: CVs', emails, letters, etc to produce a shortlist " Interview to see if the interviewee suits job + organisation " Possible further interviews/assessments, etc

3. Staff training:induction + staff development (on the job and off the job)

4. The job of the Human Resource Manager Assessing morale thro absenteeism + labour turnover. Reasons for high T/O: " Poor pay " Poor treatment of workers " Opportunities elsewhere " Poor job satisfaction " Ind Rel difficulties " Wrong workers being chosen for jobs

5 Improving morale: " Performance appraisal " Regular communication " Grievance and Dispute procedures laid out " Motivation tools (Mazlow and McGregor) rewards " Emphasise job security " Worker participation in decision making (eg Worker Directors, works councils, etc) " Profit sharing + Share Ownership schemes, Conditions of work eg Teleworking, job sharing, job rotation, employee empowerment (allowing employees to decide how to achieve targets), Occupational health - recognising the losses due to stress and ill health, being proactive to assist in a speedier recovery.

6 Managing change, Communication, Job Rotation, Incentives, Retraining, Job Enrichment (more say and responsabilities), Job Enlargement, Empowerment


1 Def- payment of money in return for a promise to make good a particular loss suffered

2 Terms- premium, policy, cover note, exposure unit, proposal form, claim form, compensation, contributory negligence, insurer, insured, reinsurance, policy excess, days of grace, ex gratia payment, surrender value (of life assurance policy), assignment of policy.

3 Principles-
Utmost good faith
Insurable Intrest
Average Clause
Proximate Cause: loss due to risk insured against

4 Motor Insurance; TP, TPFT, comprehensive, no claims bonus, loading, no days of grace, high cost due to uninsured drivers (Motor Insurers Bureau pays compo), poor roads, high court payouts, group schemes.

5 Family Insurance- house, contents, all risks, fire, subsidence, health (VHI vs BUPA), life: whole, term and endowment.

6 Business Insurance- motor, property, consequential loss, fidelity guarantee, product liability, public liability, employer liability, goods in transit (importer), PRSI, key person ins,


1 History- local chiefs, development of the social welfare state, increased expectations of what the state will pay for.

2 Types- direct, indirect, capital, local.

PAYE: P45,P60,P35 + calculations, balancing statement (form 21) if over/under paid, form 12a applying for TFA's, disincentive effect.
Self Assessment- inspector does preliminary (guess) assessment which can be amended/appealed with payment by November. Difference between amount owed and paid is rectified with form 11.
Corporation Tax- using loan intrest, depreciation (over 8 years), capital allowances (buying fixed assets), Tax Designated Areas, etc. to reduce Tax.

4 INDIRECT- VAT regressive and progressive taxes, claiming back VAT, if T/O >£30,000 must register (VAT 1 form), payable every 2 months with VAT 3 form, varying levels of tax.

5 CAPITAL- CGT: profit on selling fixed assets except the family house
CAT: on gifts and inheritances. Limited by closeness of blood relationship. Exempt- spouse, charity, education and family maintenance.

6 LOCAL- eg. rates and service charges, aimed to allow local councils more autonomy in the control of local spending, ie. what services to provide.

7 Implications for business:
a. collecting taxes, b. allowances against profit eg. urban renewal, c. disincentive effect.

8 Implications for Government- fiscal policy

9 Implications for the individual- avoidance vs evasion, dole qualification, medical card scheme, PRSI, black market,

The Economic System

1 Economy: inter dependent pool of finance flowing between a group of companies and people. Circular flow of income, leakages flowing outside the locality and injections flowing in. Flow affected by: intrest rates, inflation, tax policies, economic confidence.

2 Factors of Production: Land Labour Capital & Enterprise, rewards, primary, secondary & tertiary. Movement away from Agriculture, development of service industries. Economic Growth and Economic Development. Characteristics of a developed country/economy. New business trends: Forestry, decline in fishing stocks, EU regulation, chemical/pharmaceuticals, electronics, Government incentives, brain drain. Service industry development: Economic Development = more disposable income so more leisure time, tourism,etc., business expansion involves more use of business services. Economic systems, political decisions reflecting the will of the people.

3 The Central Bank: major tool in Government economic policy. Functions: minting money, managing foreign reserves, controlling intrest rates (inflation and Money Supply), stabilising exchange rates. ERM, economic forecasting, Central Bank Quarterly Report, Monetary and Fiscal Policy ( taxation, subsidies, current & capital expenditure, National Pay Deals.)

4 Other Institutions: (a) International Monetary Fund- finance poorer countries budget deficits (b) International Bank for Reconstruction and Development (world bank) infrastructural development lending (c) European Investment Bank- European Infrastructure.

European Union

1. History: WW2, Co-operation, EBRD, EEC 1957 Treaty of Rome, 1971 Ireland joined, future Federal
2. Running it: (a) Council of Ministers: policies to follow, (b) Euro Commission: laws and Budgets, (c) EU Parliament: watchdog, can't refuse laws, elect 5yrs, 15 Irish MEPs', (d) EU court of justice, (e) EU court of auditors: eu budgets
3. Laws: (a) Regulations: binding targets and how to achieve them, (b) Directives: binding targets only, (c) Decisions: binding declarations eg penalties for Govts, Subsidiarity: decision making as local as possible
4. EU Policies: (a) SEM: free movement of capital and labour, tax harmonisation, public procurement, remove trade barriers, Euro Ec Area: trade and ties with non EU euro countries, (b) Competition Policies: cartels, govts, monopolistic cos', mergers and t/os' etc, (c) CAP: original aims for consumers and farmers, tools (quotas, grants, subsidies, intervention), difficulties (cost, decline in small farms, food quality, etc), (d) Social Policy: improve working conditions and training for workers, Euro Social Fund: training and retraining for workers, school leavers, etc. (e) EU Environmental Policy: sustainable ec devmt + Kyoto(-8% overall, +11% Ireland), (f) Structural Policies: ERDF: infrastructure (85% if GDP 70% of EU average),(g)Common Fisheries Policy: consumers and fishermens jobs

Conflict Resolution

The Stakeholders: groups with an interest in how a business is run
1. Entrepreneurs: idea, then finance an org around the idea to make profit
2. Investors: people who finance org, may want security, worried about return and risk of losing capital.
3. Managers: plan, org and control co. Interested in goal setting and achieving
4. Staff: interested in pay, conditions, treatment, job survival, personal development (promotion)
5. Suppliers: raw mats to keep business producing. Interested in being paid, long term sales
6. Consumers: vital to success, they want quality and value
7. Government: interested in job creation and maintanance, development of a locality
8. Local Community: jobs, environmental effects
9. Pressure Groups: eg Trade Assocs, NGOs' can generate publicity which could have a positive or negative effect on the co.

Different approaches for dealing with stakeholders:
· Competitive ie win/lose, profit/loss, competing to keep staff, TU pressure, strikes
· Co-operative: co-dependency awareness leading to mutual gain, Codes of Practice, Joint Industrial Councils, grievance and dispute procedure

Reasons for Disagreement between Stakeholders:

Look for potential for conflict between each different Stakeholder, the reasons for each, their implications eg firm vs suppliers- being sued, bad publicity, etc
Possible solutions to conflict: Negotiation, Legislation, Litigation. Legislative solution means using the laws or an institution set up by law eg Equality Authority


The legal system, making laws(constitution, dail, precedent)
1. Consumer Protection Act 2007 (a) set up NCA with powers to penalise and prosecute (b) banned false or misleading advertising, pyramid selling (c) protected online buying
2. Sale of Goods and Sullpy of Services Act 1980 incl quiet possession+full legal ownership, cooling off periods for loans etc, contract with seller not manufacturer, Inertia selling (unsolicited) is unenforcable so receiver can keep if seller doesn't take back with in 6 months
3. Data Protection Act 1988: any org storing info must keep it accurate, private for lawful use only. Individuals can- get info in 40 days, have errors corrected, and be compensated for losses as a result of mistakes. Set up office of Data Protection Commissioner.
4. Industrial Relations Act 1990: only legal strikes have secret ballot, one weeks notice, official union sanction,
5. Unfair Dismissals Act 1977/93: fair dismissal if (1) misconduct of employee, eg theft, fraud etc (2) employee incapability, incompetence or unqualified to perform, (3) redundancy. Unfair if: due to Union membership, political views, race, gender, pregnancy, etc NOT AGE at present. Appeal to Employment Appeals Tribunal.
6. Employment Equality Act 1977: not subject to discrimination based on gender or marital status. Set up Employment Equality Agency to monitor, investigate
7. Law of Contract
· Offer: implied, expressed, invitation to treat, can be revoked before acceptance
· Acceptance: qualified, unqualified,
· Consideration: loss to both parties in the contract
· Intention: no duress, legal intention not social
· Capacity: not for minors, Diplomats, incapacitated, Ultra Vires
· Legality of Form: certain must be written eg sale of house, HP agreement, loan
· Legality of Purpose: for a legal purpose, ie not to restrict trade, commit fraud etc
Termination of contract: by performance, agreement, frustration (outside events), breach. Condition (essential), Warranty (non). Remedies for breach: cancel, specific preformance or sue for damages

Third Parties

1. National Consumer Agency: staate body monitoring and regulating consumer - retailer relations. It can issue (i) Prohibition Order (ii) Conpliance Notice (iii) on the spot fine. It informs consumers of their rights + dodgy retailers (Consumer Protection List)
2. Consumers Association of Ireland: consumers lobby group, informing (Consumer Choice), publicising consumer concerns.
3. Ombudsmen: (1) for the Public Sector, (2) for Credit Institutions, (3) for Insurance Industry
4. Small Claims Court: small fee, no solicitors, handled by the Registrar of the District Court who tries to agree a solution, if not goes to the District Court.
5. Data Protection Commissioner


1 Intro- info flowing up, down, & horizontally : avoiding duplication but yet ensuring that each person has all the info necessary to make all decisions.

2 Factors to consider: message, clarity, target, feedback, speed, cost, convenience, distance

3 Legal communication- due to Companies acts 1963-90. Secretary, etc.
a. Reports-formal presentation of facts and recommendations addressed to a body to enable them to make a decision. Features- terms of reference, title, clear, structured, including appendices and bibliography. Pie charts, histograms, pictograms, etc.
b. Meetings- allowing opinions to be aired to a group, giving information, and letting decisions to be made. Notice, agenda, quorum, minuites read, chairman to keep order, voting by show of hands, ballot, proxy, casting vote. Meeting held In Camera, Ad Hoc Committee, Works Councils.

4 Electronic Communications: IT used for speed, accessibility to info, makes automated decisions, Decision Support Software, etc.
a. EDI (Electronic Data Interchange): standardising info/transactions from computer to computer
b. ISDN (Integrated Services Digital Network): phone and fibre optic lines for sending and receiving information, it allows info transfer (EDI), remote working (from home),videoconferencing, security operations, networking (LAN's and WAN's)
c. Internet: is it secure? viruses, copyright, E-mail (leaving messages for user at their Internet service provider ISP)
d. Data Protection Act 1988: personal info on data subject must be obtained, kept and used for agreed lawful purposes with total confidentiality. Data Protection Commissioner information notices (provide info), prohibition notices (stop disclosure), enforcement notices(data controllers to erase,alter, etc info)

5 Barriers to effective Communication-
a Unclear
b. Receiver doesn't understand language, jargon, etc.
c. Lack of trust of parties
d. Wrong medium
e. Clouding of the issues with irrelevancies
f. Poorly timed


1 Intro: the final a/c's and information found, more info needed, day to day management decisions, handling cash flow, etc.

2 Things to look for: Profitability (RoI, RoCE), Price Structure (mark up and margin), Liqudity (a/test + current), Risk (gearing)

3 Information found: overall picture of health of firm,


1 Intro: developing the business idea into a profitable venture, organising the idea to make money, artist vs manager.

2 The Business Plan: needed to focus ideas and anticipate problems, shown to backers to prove venture has been well thought out, needs to be- ACCURATE, BRIEF, CLEAR, REALISTIC, CONSULTATIVE,

3 Parts of plan: (a) WHAT we will make/do
(b) WHO the entrepreneurs are (experience)
(c) HOW we will make it (staff, machinery needed, etc.)
(d) HOW it will be financed (incl. cash flow statement)
(e) MANAGEMENT structure (form of business-sole trader, partnerships (unltd), limited cos, implications of each, etc.)
(f) MARKETING PLAN (5 P's incl feasibility study)

4 Types of production: job, batch & mass, different skill levels, flexibility, costings (economies of scale), subcontracting vs in house producting- advantages of each.

5 Finance: ST, MT, LT, effects on CONTROL, RISK, AMOUNT, TAX, INCOME.
LT- grants (diff sources), motrgage, owners equity, venture/seed capital, project finance, sale and leaseback, retained earnings.
MT- leasing, HP, term loan,
ST- acc exps, O/D, trade credit, factoring (invoice discounting)

6 Cash Flow forecast- must be realistic, shows sources and uses of finance, positive/negative cash flow, need for working capital

7 Financial Institutions- types, services they offer, ways of paying bills, bank reconciliation, characteristics of the ideal investment, managed growth funds etc.

8 Break Even Charts


1 Intro: the final a/c's and information found, more info needed, day to day management decisions, handling cash flow, etc.

2 Things to look for: Profitability (RoI, RoCE), Price Structure (mark up and margin), Liqudity (a/test + current), Risk (gearing)

3 Information found: overall picture of health of firm,