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Business Management Unit 3/4 > AOS1: Business Foundations > Flashcards

AOS1: Business Foundations Flashcards

1
Q

Sole Trader

A

One owner, unlimited liability, retains all profits

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2
Q

Liability

A

Any loss or debts of the business

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3
Q

Advantages of a sole trader

A

Low cost, simple, complete control, no partner disputes

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4
Q

Disadvantages of a sole trader

A

Unlimited liability, burden of management, difficult to operate when sick, need to perform variety of tasks

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5
Q

Partnership

A

2-20 owners. All partners equally responsible for liability.

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6
Q

Advantages of a Partnership

A

Low startup cost, shared responsibilities, pooled funds

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7
Q

Disadvantages of a Partnership

A

Personal Unlimited liability for all debts, possibility of disputes

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8
Q

Private Limited Company

A

Has at least one shareholder, and a maximum of 50 non-employee shareholders.

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9
Q

Advantages of private limited company

A

Limited liability, easier to attract finance, easy transfer of ownership, perpetual succession, company tax rate lower

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10
Q

Disadvantages of private limited company

A

Cost of formation, company is taxed, public disclosure, inefficiences

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11
Q

Public Listed Company

A

Incorporated business with a minimum of five shareholders, and shares are trader on the ASX

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12
Q

Advantages of a public listed company

A

Can attract extra capital by issuing shares on the ASX, Easy transfer of ownership

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13
Q

Disadvantages of a public listed company

A

Highly complex business structure, significant establishment costs, requires accountability and compliance

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14
Q

Social Enterprise

A

Has the objective of fulfilling a social need and invests profit into a social need or back into the business

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15
Q

Advantages of a social enterprise

A

Can meet a demand that commercial businesses may not, meeting a social need may have a positive effect on market share

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16
Q

Disadvantages of a social enterprise

A

Difficulty in obtaining capital for startup, can be difficult to focus on business objectives and social objectives

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17
Q

Government Business Enterprise

A

Government owned and operated

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18
Q

Advantages of a government business enterprise

A

Can carry out business in areas that private companies would be hesitant to invest in, can give healthy competition to other businesses, can operate with some independence from the government

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19
Q

Disadvantages of a government business enterprise

A

Political interference in the day-to-day operation, inefficiencies, less accountability, heavily regulated

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20
Q

Examples of business objectives

A

To make profit, to increase market share, to improve efficiency, to improve effectiveness, to fulfil a market need, to fulfil a social need and to meet a shareholder expectations.

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21
Q

What are some business Stakeholders

A

Owners, managers, employees, customers, suppliers, general community

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22
Q

Company structures

A

A company structure is incorporated and is a sperate legal entity to an individual or individuals

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23
Q

Stakeholder Conflict

A

Different stakeholders have competing values or interest for the business

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24
Q

Social entrepreneur

A

A person who establishes an enterprise with the aim of solving a social problems or effecting social change

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25
Q

Objectives

A

Statements of desired achievement that provide direction for the business

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26
Q

What is a stakeholder?

A

Someone that has a direct or vested interest in the activities of a business

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27
Q

Autocratic

Management Style

A

Manager tells staff what decisions have been made.
-Highly centralized, communication from top down, no discussion.

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28
Q

Persuasive

Management Style

A

Manager makes decision than persuades workers of the benefits.
-Decision making rests solely on manager, however employee may feel better about a decision because it is explained.

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29
Q

Consultative

Management Style

A

When the manager consults employees before making decisions.
-Seeks input
-Takes into account the opinions of team members

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30
Q

Participative

Management Style

A

Where the manager unites with staff to make decisions together
-Decentralized decision making
-two way communication
-management ultimately retains control

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31
Q

Laissez-Faire

Management Style

A

Employees assume total responsibility for workplace operations
-Approach problems and tasks in their own way
-only constraint being budgets, timelines and goals

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32
Q

Skills

A

The ability
to do something
well, gained
through training
and experience

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33
Q

Communication

Management Skill

A

A process of
creating and
exchanging
information
between people
that produces
the required
response.

34
Q

Personal communication

Dot Point of Management Skill “Communication”

A

Sharing information between
the manager and subordinates

35
Q

Internal organisational communication

Dot Point of Management Skill “Communication”

A

Systems used to share with internal stakeholders such as employees

36
Q

External operational communication

Dot Point of Management Skill “Communication”

A
37
Q

Delegation

Management Skill

A

Passing of
authority down
the hierarchy to
perform tasks or
make decisions

38
Q

Planning

Management Skill

A

Formalised
decision-making
process that is
future-oriented

39
Q

SWOT Analysis

Management Skill “Planning” Dot Point

A

An assessment
of the internal
strengths and
weaknesses
and the external
opportunities
and threats for
a business in a
given situation

40
Q

Strategic Planning

Management Skill “Planning” Dot Point

A

Long term planning undertaken by senior management to achieve business objectives

41
Q

Operational Planning

Management Skill “Planning” Dot Point

A

The
detailed, short term
planning
undertaken by a
business

42
Q

Tactical Planning

Management Skill “Planning” Dot Point

A

Time
frame is medium
term. Undertaken by
middle-level
management.

43
Q

Leading

Management Skill

A

The skill
of a manager
when guiding
workers towards
achieving the
goals of the
business

44
Q

Decision-Making

Management Skill

A

A multistep
approach
whereby a
selection is
made between a
range of different
alternatives

45
Q

Interpersonal Skills

Management Skills

A

Skills
used every day
to communicate
and interact with
other people,
both individually
and in groups

46
Q

Corporate Culture

Corporate Culture

A

System of shared
values and beliefs
of people within a
business

47
Q

Official Corporate Culture

Corporate Culture

A

Formal written expression of values and beliefs desired by management

48
Q

Real Corporate Culture

Corporate Culture

A

Actual practises and values that are actually held by the employees in a business

49
Q

What are some strategies to develop positive corporate culture?

Corporate Culture

A

Creating mission, vision and values statements
Establishing management structures
Choice of management styles
Implementing policies
Business documentation and forms of communication
People
Physical environment and material symbols
Stores, narratives and rituals

50
Q

Benefits of Delegation

Dot point of Delegation

A

Assists with smooth flow of production, acts as a time saver, provides opportunity for development and training.

51
Q

5 Step Process for Delegation

Dot point of Delegation

A

Analysis, Appointment, Briefing, Control, Apprasial.

52
Q

5 Step Process for Planning

A

Set Goals, Gather info, establish promoting and restricting factors, develop action plan, evaluate and review

53
Q

Details of Decision Making

A

Requires use of a Systematic Approach that is evidence based. Helps reduce errors and bad decisions, reflects the management style.

54
Q

Best skills for Autocratic style

A

High: Planning, decision-making, communication

55
Q

Best skills for Persuasive style

A

High: Planning, decision-making
Medium: Communication, delegation, interpersonal

56
Q

Best skills for Consultative style

A

High: Planning, decision-making, communication

57
Q

Best skills for Participative style

A

High: Communication, interpersonal, leading
Medium: Decision-making, delegating

58
Q

Best skills for Laissez-Faire style

A

High: Communication, delegating, leading

59
Q
A
60
Q

Market Share

A

Market share is the business’s percentage of total sales controlled by the business in a industry

61
Q

Efficiency

A

The best use of resources in the production of goods and services

62
Q

Effectiveness

A

How successful a business is at achieving its objectives

63
Q

What are business owners concerned with?

Stakeholder conflict

A

Profit, market share, adherence to rules

64
Q

What are Managers concerned with?

Stakeholder conflict

A

Set and achieve objectives, career development, fair remuneration, job satisfaction

65
Q

What are employees concerned with?

Stakeholder conflict

A

Fair pay, safe workplace, career advancement, job satisfaction, secure job

66
Q

What are customers concerned with?

Stakeholder conflict

A

Quality product, customer service, ethical and socially responsible business

67
Q

What are suppliers concerned with?

Stakeholder conflict

A

Ensure that the business is profitable, paid promptly, long term supplier relationship

68
Q

What is the general community concerned with?

Stakeholder conflict

A

Business to participate in the community, ethical business, socially responsible business

69
Q

Advantages of Autocratic

A

Quick decisions, made by experienced leader, communication is direct

70
Q

Advantages of Persuasive

A

Decision making is quick, suits high risk decisions

71
Q

Advantages of Consultative

A

Variety of ideas, employee involvement, motivation and employee satisfaction

72
Q

Advantages of Participative

A

Trust and faith in employees, morale increased, Open communication

73
Q

Advantages of Laissez-Faire

A

Employee independence, motivation and satisfaction, creavity and innovation, teamwork

74
Q

Disadvantages of Autocratic

A

Quick decision is not always the best, discourages teamwork and opinions, low motivation and satisfaction

75
Q

Disadvantages of Persuasive

A

No input from workers, workers can still feel alienated, employee initiative and commitment overlooked

76
Q

Disadvantages of Consultative

A

Empoyees may not understand, time-consuming, employees may not feel valued if their ideas aren’t used

77
Q

Disadvantages of Participative

A

Can give rise to employee conflict, time consuming and lack of contribution by all employees

78
Q

Disadvantages of Laissez-Faire

A

Lack of guidance can cause some employees to have a lack of direction, does not suit untrained employees or those who need structure

79
Q

How is the appropriateness of management styles measured?

A

Nature of the task, time, experience of the employees and the manager’s preference.

80
Q
A

Business Management Unit 3/4 (2 decks)

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