Business Management

(Net profit before interest and tax / capital employed) * 100

(Net profit before interest and tax / sales revenue) *100

(Gross profit / sales revenue) *100

(Original cost - residual value) / expected life

(Target profit + total cost) / output

Total cost / output

(Fixed cost + target profit) / contribution per unit

Fixed cost / contribution per unit

Selling price - average variable cost

Total revenue - total variable cost

More efficient to advertise large number of products

Easier for larger companies to receive loans

The role of a business is to combine human, physical, and financial resources to create goods and services

Resources that a business uses in the production process

Turning the inputs into manufactured goods or the provision of services

The output or provision of final goods and services

An individual who plans, organises, and manages a business, taking on financial risks in doing so

The act of being an entrepreneur but as an employee within a large organisation

Owned and controlled by private individuals with an aim to make profit

Owned by the government to provide essential goods and services

Sole traders and partnerships

Private / public limited companies

Revenue-generating businesses with social objectives at the centre of business operations

Businesses owned and run by the members, including employees and customers

A financial service aimed at financing disadvantaged members of society

When the government works together with the private sector

Businesses run in a commercial manner but without profit being the main goal

Non-profit social enterprise that operates in the private sector

Provides voluntary support for good causes

Long term aspirations of a business

Underlying purpose of an organisation's existence and it's core values

Set by senior leadership to determine the long term goals and actions

Set by the middle management to determine the medium term action plan

Set by the lover management to determine the short term day to day objectives

The consideration of ethical and environmental issues relating the business activity towards all stakeholders

The company genuinely does it for social benefits

Businesses ought to be socially responsible only if such actions help them become more profitable

The belief that it is the government's job to protect society

Market penetration, product development, market development, diversification

Political, economic, social, technological

Social, technological, economics, environmental, political, legal, ethical

As the output increases the cost per unit output decreases

Lower average cost due to better skilled management

Lower average cost due to bulk purchasing

Lower average cost due to better investments and research

As the business expands its operations the average cost per unit output increases

A business grows using its own resources to increase the scale of its operations

A business grows by collaborating with another firm (acquiring, merging)

Firms are in the same line of business at the same stage of production

Firms are in the same line of business at different stages of production

Firms sell related goods that do not directly compete with each other

Firms are in completely different lines of business

An external growth strategy that combines the contributions and responsibilities of two firms to a shared project by forming a separate legal enterprise

An agreement between two parties to pursue shared objectives while remaining independent organisations

An arrangement where the franchisor sells the rights to sell their products or use the company name / brand to franchisees

Worldwide movement towards economic, financial, trade, and communications integrations

Product, price, place, promotion, people, process, physical evidence

Recruitment, training, appraisal, termination

Job description, person specification, job advert, application processing, selection

Done while the employee is doing their normal job while at the work place

The training received when first starting a job

The training received by a mentee from a mentor

Training that happens outside working hours away from the job

Focuses on employees developing their thinking and processing skills

Focuses on employees developing certain interpersonal skills

The process of reviewing the performance of employees against pre-set objectives

Ongoing process that focuses on giving employees recognition and feedback

Measures employee's performance based on standards set by the business

Feedback on the employee's performance is collected from managers and co-workers

Employees reflect on their own performance by rating themselves

Level of responsibilities in the business

Formal route that a decision must follow

The number of subordinates directly under the authority of a manager

Giving one's subordinate authority to make a decision or carry out a task

All major decisions of the company are made by a small group

The relative importance of rules and procedures

Many levels of hierarchy, narrow span of control, long chain of command, centralised

Few levels of hierarchy, wide span of control, short chain of command, decentralised

Based on chain of command

Based on departments

Market structure where employees are organised around different projects the firm carries out

Core managers, contractual fringe, flexible workforce

Leader holds most decision making power, minimal consulting, close supervision

Leader takes on a paternal role, great concern for employees, extreme loyalty and trust

Employee involvement in decision making

A lot of freedom, skilled workforce

Pay, above all is the main source of motivation

Psychological, safety, love / belonging, esteem, self-actualisation

Hygine and motivators

Giving workers variety in what to do

Giving workers more complex things to do

Delegating decision making to workers

Employees are given unfamiliar tasks

Workers will compare their efforts or rewards to those of others

Achievement, affiliation, power

Autonomy, competence, relatedness

Expectancy, instrumentality, valence

Regular fixed payment to staff, typically monthly

Staff is paid per hour of work