AQA AS-Level Business: People management (7137) – Revision Notes

Quick recall for AQA AS Business (7137), for first teaching from September 2026, section 3.2.1 People management. For full explanations and a worked data example, use the study guide. Test yourself with the practice questions. The AQA AS Business hub, the checklist and the diagnostics cover the rest of the course. Ethics in HR is not included. For stakeholder links see What Is Business? and for the course layout the course structure guide.

Key definitions

• HR objectives: targets for the number and skills of employees, turnover and retention, engagement, employee costs, and equality, diversity, inclusion and belonging.
• HR planning: matching the workforce to future needs through recruitment, training, retention, redeployment and redundancy.
• Flexible employment: a mix of employment types and patterns so the workforce can change with demand.
• Span of control: the number of people reporting directly to one manager.
• Levels of hierarchy: the layers of authority in the structure.
• Delayering: removing one or more levels of hierarchy.
• Appraisal: a regular review of performance against agreed targets.
• Talent management: acquiring, managing, developing and retaining valuable people.
• Employee voice: the way staff express views and influence decisions.

HR planning in steps

1. Set the HR objectives from the corporate objectives.
2. Audit the current workforce: numbers, skills, age, location.
3. Forecast future needs from expected demand and strategy.
4. Identify gaps in numbers or skills, and surplus.
5. Choose actions: recruit, train, retain, redeploy or make redundant.
6. Check what the labour market can supply and review.

Employment types at a glance

Type	Main plus	Main minus
Full-time	Cover and commitment	Fixed cost
Part-time	Matches demand	Handover and admin
Permanent	Loyalty, training pays back	Redundancy cost
Temporary	Peak cover	Low commitment
Zero-hours	Hours track demand	Insecurity, turnover
Freelance	Specialist skill on demand	Little control

HR data formulas (standard forms)

Measure	Formula
Productivity	output ÷ employees
Sales per employee	revenue ÷ employees
Employee turnover	leavers ÷ average employees × 100
Employee costs % of revenue	employee costs ÷ revenue × 100
Percentage change	(new − old) ÷ old × 100
Index number	new ÷ base × 100

Method for a data question. Write the formula, substitute, give units or a percentage, then comment on what it means for the business and what else you would want to know.

Worked reminder: Calder Quay Couriers.

	Year 1	Year 2
Employees	25	24
Deliveries	300,000	336,000
Revenue	£1,500,000	£1,620,000
Employee costs	£480,000	£486,000
Leavers	5	3

• Productivity: 12,000 then 14,000 deliveries per employee, an index of 116.7 (up 16.7%).
• Sales per employee: £60,000 then £67,500, an index of 112.5.
• Employee turnover: 20% then 12.5%.
• Employee costs as a percentage of revenue: 32% then 30%.
• Revenue rose 8% but employee costs rose only 1.25%.

Comment: fewer staff are doing more, and turnover has fallen, so the position has improved on every measure. The risk is overload on 24 people, so engagement and wellbeing data should be checked. Also say why the HR data matters: engagement, representation, diversity and wellbeing are measured so that problems are found early.

Structures

Feature	Tall	Flat
Levels	Many	Few
Span	Narrow	Wide
Communication	Slow	Faster
Management cost	High	Lower
Supervision	Close	Limited
Promotion steps	Many	Few

Feature	Centralised	Decentralised
Decisions made	At the top	Lower down
Plus	Consistency, control	Speed, local knowledge, staff development
Minus	Slow, demotivating	Inconsistency, less control

Delayering / restructuring: cuts cost, speeds communication, widens spans; but redundancy, overload, lost experience and falling morale.

Quick sum: levels needed fall as span widens. With 56 staff and a span of 8, seven supervisors are needed.

Leadership

Style	Feature	Fits	Risk
Autocratic	Leader decides	Crisis, unskilled team	Resentment, turnover
Democratic	Leader consults	Skilled team, complex issues	Slow decisions
Transformational	Vision, inspiration, change	Growth or major change	Depends on the leader

Impact: individuals (motivation, stress), teams (cooperation), the business (performance, retention). Influences on choice: personality, staff skills, urgency, culture.

Developing people and teams

• Appraisal: feedback, training needs, link to pay or promotion. Risk: feels like criticism.
• Talent: adds hard-to-copy skills. Challenges: cost, poaching by rivals, trained staff leaving.
• Teams: share skills and ideas and spread the load; risks include conflict and free-riding.

Hackman’s model, five conditions: real team; compelling direction; enabling structure; supportive context; expert coaching. Judged on output quality, ability to keep working together, and member growth. Exam use: spot the missing condition in the case.

Motivation theories

Theory	Core idea	Business use	Limit
Taylor	Pay is the main motivator; simple timed tasks	Piece rate, tight methods	Ignores other needs; monotony
Maslow	Hierarchy: physiological, safety, social, esteem, self-actualisation	Meet the next unmet need	Not everyone follows the order
Herzberg	Hygiene factors prevent dissatisfaction; motivators raise motivation	Enrich jobs, delegate	Hard to separate in practice

Rewards

• Financial: wages, salaries, piece rate, commission, performance-related pay, shares, fringe benefits. Plus: attract and direct effort. Minus: cost, narrow focus, short-lived effect.
• Non-financial: delegation, empowerment, job enrichment, training and development, remote, hybrid and flexible working. Plus: meets higher needs. Minus: needs trust and skilled management.

Wellbeing, representation and relations

• Wellbeing methods: physical and mental health support, inclusive environment, employee voice, flexible working. Benefits: lower absence, retention, engagement. Challenges: cost, hard to measure.
• Individual representation: flexible, personal; low bargaining power. Collective (trade unions, employee forums): strong voice, protection; may bring conflict and delay.
• Poor relations, causes: pay disputes, poor communication, unfair treatment, sudden change. Consequences: strikes, absence, turnover, lower productivity, reputation. Improving: communicate, consult, fair pay, resolve grievances.

Influences and links to other functions

• Influences on HR objectives: the corporate objectives, business size and sector, finances, the labour market, the culture and competitors’ pay.
• Influences on HR planning: the current workforce, future needs, skills and numbers gaps, and the labour market.
• Finance: sets the pay budget and shows employee costs against revenue.
• Marketing: forecasts demand, which drives staffing numbers and the skills needed.
• Operations: sets output targets, shift patterns and the training needed for equipment.
• Competitiveness: skilled, motivated and well-led people improve service, quality, productivity and the ability to adapt, which are hard for rivals to copy.

Case-study skills for people questions

1. Define or identify the term in a few words.
2. Apply it: use a figure, job role or fact from the case.
3. Analyse: explain a chain of cause and effect, such as flatter structure, faster decisions, higher manager workload, lower service quality.
4. Evaluate: weigh both sides, then reach a judgement that depends on a stated factor such as business size, staff skills, urgency or cost.
5. Check the command word: state needs one fact; explain needs a reason; evaluate and justify need a judgement.

For calculation questions, show the formula, the working and the unit, then say what the answer suggests.

Must-know distinctions

• Employee turnover (staff leaving) is not revenue.
• Span of control is not the number of levels.
• Hygiene factors prevent dissatisfaction; motivators create motivation.
• Delegation passes tasks; empowerment passes decision-making power.
• Individual representation is one person; collective representation is a group voice.

Quick self-test

1. A shop averages 60 staff and 9 leave. Calculate employee turnover.
2. Employee costs are £84,000 and revenue £420,000. Calculate employee costs as a percentage of revenue.
3. A team of 18 produces 12,600 units. Calculate productivity.
4. An index rises from 120 to 138. What is the percentage change?
5. Sales per employee rises from £52,000 to £57,200. Give the index with the first figure as 100.
6. A worker is paid £2.40 per unit and makes 310 units. Calculate pay.
7. Fifty-six staff are managed with a span of control of 8. How many managers are needed?
8. Is pay a hygiene factor or a motivator in Herzberg’s theory?
9. Name two of Hackman’s conditions.
10. State one disadvantage of delayering.
11. Give one advantage of a zero-hours contract to the employer.

Answers

1. 9 ÷ 60 × 100 = 15%.
2. 84,000 ÷ 420,000 × 100 = 20%.
3. 12,600 ÷ 18 = 700 units per employee.
4. (138 − 120) ÷ 120 × 100 = 15%.
5. 57,200 ÷ 52,000 × 100 = 110.
6. 310 × 2.40 = £744.
7. 56 ÷ 8 = 7 managers.
8. A hygiene factor.
9. Any two of: real team, compelling direction, enabling structure, supportive context, expert coaching.
10. Any one of: redundancy costs, larger workloads, falling morale, loss of experience.
11. Hours can follow demand, so there is little paid idle time.

Where marks are usually lost

• Using the wrong base in a percentage change or index number.
• Forgetting the percentage sign or units in a calculation.
• Calculating a figure and not saying what it means for the business.
• Mixing up employee turnover with revenue.
• Listing Maslow’s levels or Hackman’s conditions without applying them to the case.
• Treating Herzberg’s pay as a motivator.
• Saying tall or flat structures are good or bad with no link to the business.
• Writing about only one side in an evaluation, with no judgement.
• Ignoring the data supplied in the case study.

Frequently asked questions

What does employee turnover mean in AQA AS Business? In HR, employee turnover is the number of staff leaving as a percentage of the average number employed. It is not the same as revenue, which is sometimes also called turnover.

What is the difference between delegation and empowerment? Delegation passes tasks down to an employee. Empowerment passes decision-making power, so the employee decides how the work is done.

What is the difference between a tall and a flat structure? A tall structure has many levels and narrow spans of control, giving close supervision but slower communication. A flat structure has few levels and wide spans, giving faster communication and lower management cost but less supervision.

Which motivation theories are named in AQA AS Business (7137) section 3.2.1? Taylor, Maslow and Herzberg. Each should be applied to the business in the case and judged on its limits, not just described.

How do you calculate an index number from HR data? Divide the new figure by the base figure and multiply by 100, so the base period is 100. Using the wrong base is a common error.

Official syllabus

AQA AS and A-level Business specification (7137, 7138), for first teaching from September 2026, section 3.2.1 People management.