Business 0450 · IGCSE · Organisation and management
Organisation and management — practice question
AUC operates as a bank. Its organisational structure is tall, with many layers and a lengthy chain of command. Most of its customers are small businesses from the tertiary sector. In the previous year AUC recorded a loss of $60m. The new Managing Director has to lift employee motivation as well as cut costs. 20% of its 19 000 employees will be made redundant. She said: ‘Keeping customer loyalty is important. We will need to tell our customers that 500 of our 2000 retail bank branches are going to close.’
(a)[2]
What does the term ‘chain of command’ mean?
(b)[2]
Identify two examples of activity carried out in the tertiary sector.
(c)[4]
Identify and explain two reasons why keeping customer loyalty matters to AUC.
(d)[6]
Identify and explain two factors that AUC should take into account when deciding which employees to make redundant.
(e)[6]
Explain two methods of communication that AUC could use to tell customers about the planned closures. Recommend which method AUC should use. Justify your answer.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “Structure by which orders/messages travel down and up the hierarchy” …