Business Management - Unit 1: Introduction to business management

Tangible products. They are from the primary and/or secondary sector

Intangible products that the buyer does not take “physically” home. They are from the tertiary and/or quarternary sector.

The way in which all businesses are organized

making sure that the business has sufficient funds to carry out its business activity - to make the product or to deliver the service.

is the function that makes sure the business employs the correct number of appropiriately skilled employees in order to produce its products or deliver its services

involves selling the right product, at the right price, at the right time, to the right customers

plan how goods and services are to be produced and make sure that the correct quantity is produced

includes activities that companies undertake to innovate and introduce new products and services

All raw materials are acquired by extraction, mining, etc. Government monitors this sector.

Raw materials are processed, normally by manufacturing

All services are provided using manufactured products. Services can be education, financial, leisure, healthcare, etc.

Provides services that are more focused on knowledge

Individuals that demonstrate enterprise and initiative in order to make a profit. Are typically self-employed

Individuals employed by a large organization who demonstrate entrepreneurial thinking.

Sets out how the organization will meet its business objective

all organizations owned by individuals or groups of individuals

organizations generally created by governments in order to provide public goods. They do not function under the same profit-making imperative

A business or other organization whose primary goal is making money (profit) for the company and its inverstors

They have no owners which makes them primarily accountable to themselves allowing them to receive donations, charge fees, etc.

a for-profit business owned by a single individual. There is little legal distinction between the business and its owner and the owner is personally responsible for the debts of the business.

a for-profit business owned by two or more individuals who are each personally responsible for the debts of the business.

A voluntary association formed and organized to carry on a business

a for-profit business owned by numerous shareholders who enjoy limited liability. That is, individual shareholders are not responsible for the debts of the business.

a corporation where owners are shareholders and own shares in the business that represent their ownership percentage of the business

a corporation where shares are freely traded in the stock exchange and initially released through an IPO - Initial Public Offering

non-profit organization that usually satte their purpose or mission as benefiting society or the environment

non-profit organizations that exist to benefit the public

organizations that engage in business activity but that have also set themselves important goals in terms of improving society or protecting the environment.

organization that is owned by its members who come together to work towards a common interest. These are run democratically, with members having a say in important decisions.

make financial services available to individuals whose needs would otherwise not be met by traditional financial institutions like banks

Written expression of an organization’s long-term ambitions that it hopes to realize in the future. It is often an optimistic view of what the organization hopes to accomplish in the future.

a written expression of an organization’s purpose and reason of being

They are goals an organization would like to achieve. They may be somewhat broad, optimistic and imprecise.

More concrete than aims. Are often measurable and time-specific, making it easy to evaluate whether they have been attained or not.

Acronym for Specific, Measurable, Achievable, Relevant, Time Specific

Plan for achieving an aim or objective, involve important decisions

Specific day to day actions that support the strategy

The goals set by an organization that fall within an established set of moral guidelines or fair business practices.

Refers to corporations’ obligations to society at large as well as the environment

Strategy used by businesses to analyze and identify different factors of it: strengths, weaknesses, opportunities and threats.

It is a growth strategy for businesses that is based on two criteria: market and products. It includes: product development, market development, market penetration and diversification.

any individual or group that affects an organization or is affected by it. The very definition is that they have an interest in the company and usually are affected by the company’s growth and development.

Are individuals or groups that have an impact on a business but do not work there and do not form part of the decision-making of the business.

Are part of the company. They may affect or be affected by it.

Tool or framework that is useful in eximining a firm’s external environment

factors that considers lifestyles, beliefs, and values.

Factor that includes infrastructure, advances, tools, innovations, ICT.

Factors that consider the economic activity of the country. “Business cycle”: recessions, depression, GDP, peak, trough, recovery, etc. Economic indicators such as Demand and supply, inflation, unemployment.

Considers climate change, pollution, water sources, wastes, air pollution, recycling, animal habitats, etc.

Refers to the political situation or regime, government of a nation.

Factor that considers laws and regulations of a country, it is related to politics but on practical application of the law.

Factor that considers the moral guidelines or corporate behavior.

Includes statistics and data of different features of the population such as religion, ethnicity, age, integration, and tolerance of people.

The average unit cost of production decreases as the level of output increases

cost of producting a single unit of output

The situation when the average unit cost of production increases as the level of output increases

refers to expansion that is carried out by the organization itself (internally)

Involves the type of growth when a company considers another organization in order to expand

A form of external growth that usually results in two firms combining to form a third entity

A form of external growth. This terms implies that one firm purchases another firm.

A term often used to describe the process that results in either a merger or acquisition. This usually involves one firm offering to buy the shares from the shareholders of another firm, usually at a price that exceeds theier value in the stock market.

The creation of a new company by two or more “parent” companies. Usually for a specific time period.

Involves two or sometimes more organizations working together to realize a set of common objectives

The increasing interconnectedness of countries across the world in terms of communication, culture, trade, and the movement of people.

Legal agreement whereby a franchisee buys the rights to use the name and business model of a franchisor.

an individual or company that sells or grants a franchise for the sale of goods or the operation of a service

an individual or company that holds a franchise for the sale of goods or the operation of a service.

corporations that operate in at least two countries, one of which is outside the corporation’s “home” country.