Book Notes - Chapters 4, 8, 6, 9 Flashcards
(CIO) Chief Information Officer
Executive responsible for managing all information resources and processes in an org
Knowledge Worker
Worker who develops and uses knowledge, contributing to and benefiting from information used in performing various tasks, incl: planning, acquiring, searching, analyzing, organizing, storing, programming, producing, distributing, marketing or selling functions
Technology Transfer
Formal transfer of rights to use technology given to the user by the owner (usually developer)
Intrapreneurs
Entrepreneurs who apply their creativity, vision and risk taking within large organizations rather than starting companies of their own
Small Business
Business that is independently managed, is owned by an individual or a small group of investors, is based locally ad is not a dominant company in its industry
Business Plan
Formal written statement that describes in detail the idea for a new business and how it will be carried out, and includes a general description of the company, the qualifications of the owner(s) a description of the product or service, an analysis of the market, and a financial plan
Debt
Form of business financing consisting of borrowed funds that must be repaid with interest over a stated period
Equity
Form of business financing consisting of funds raised through the sale of shares
What is technology?
Technology is the practical application of knowledge
What is information technology?
The study or use of systems (especially computers and telecommunications) for storing, retrieving, and sending information.
What is technology planning?
Technology planning is a continual process to ensure that businesses are effectively and efficiently managing their Technologies
List the steps involved in technology planning
1 requirements analysis 2 design 3 implementation 4 testing 5 feedback 6 evolution
What are complementary Technologies and why are they important?
Complementary technology is like apps for iOS or Android, they are important because as complementary technology grows so does the supporting technology (installed base). As they all grow together they become more popular and more users tend to jump on board. The opposite can also happen, when less complimentary technology is available
Why is the installed base important?
The installed base is important because if not only allows complimentary technology to be developed an integrated within the installed base but the size and number of users of the installed base will also determine the exposure amount. This can greatly affect the success rate of complementary technology and the lifespan of the installed base
What are network effects?
Network effects exist when the value of a product depends on the number of users Facebook and Twitter are good examples of this. You would not be using Facebook or Twitter if your friends were also not using it.
How can tracking day-to-day activities increase business success?
Tracking day-to-day activities help increase business success as businesses can adapt to changing market conditions rapidly, reducing the risk of sales loss and increasing the chance of success by tailoring the business strategy to meet the market conditions.
Why is it important to protect our information?
Supporting to protect your personal information since your information can be collected, shared, and used to personally and financially harm you or your business
What expenses are associated with technology acquisition and maintenance?
Technology development requires companies to continually evaluate their existing technology and determine if new technology would provide better competitive advantages.
One of the critical considerations in mergers and Acquisitions is the compatibility of different Technologies used in each company some considerations would be whether to keep the technology separate, use one of them, or combine both. Regardless of the decision it is a very expensive process in both time and money
Why is it important that social media is current and relevant to customers?
Social media benefits includes increased brand recognition, increased brand loyalty, ease of switching from one retailer to another, lower marketing cost, increased numbers of consumers visiting social media sites. Social media allows small businesses with Niche markets to expand and have a global presence.
Why has online retailing increased?
Retail companies are taking on intermediaries and selling directly to their customers. New technologies has allowed retailers to sell globally such as language and customer support translation tools.
Describe several types of entrepreneurs
Classic Entrepreneur - Some are Micropreneurs, they start small and plan to stay small. Mainly for personal lifestyle reasons. Contrary there are also Growth-Oriented entrepreneurs, who are individuals who want their businesses to grow into huge corporations.
Multipreneurs/Serial Entrepreneurs - Thrive on the challenge of building a business and usually start a series of companies
Intrapreneurs - Employees that work for a business but enjoy the freedom to nurture their ideas, develop new products. They have a high degree of autonomy to run their own mini-companies within the larger enterprise.
Describe the traits and skills of successful entrepreneurs.
Ambitious, Independent, Self-Confident, Risk Taking, Visionary, Creative, Energetic, Passionate, Committed
What is the difference between entrepreneurs and business owners?
Business owners are more managers than creators.
What are some common major factors that motive entrepreneurs to start businesses?
Reasons include: Financial Independence, frustration working for someone else, feeling of personal satisfaction for the work you created and developing the lifestyle you want.
What does it mean when they say an entrepreneur should work “on a business” and not “in it”?
There is a bridge every entrepreneur must cross in order to grow a business beyond a certain point, a point where they must transition from “doing” to “leading.”
Why are small businesses becoming so popular?
Independence and a better lifestyle, Personal satisfaction from work, Rapidly changing technology, Outsourcing, Major corporate restructurings and downsizing.
Advantages and Disadvantages of small businesses
Advantages - Flexibility to adapt quickly to changing market conditions, innovation can happen faster, operate more efficiently, increased personal one-on-one customer service.
Disadvantages - Difficulty obtaining financing, limited variety of employee skill-set may impact growth, complying with regulations is expensive for smaller companies, major time commitments by the owners
Angel investors
Individual investors or groups of experience investors who provide funding for start-up businesses
What are the drawbacks of sole proprietorship?
Unlimited Liability Difficulty in raising capital Limited managerial experience Trouble finding qualified employees Personal time commitment Unstable business life Losses are the owners responsibility
Business Development Bank of Canada BDC
The bank that provides small and medium-sized businesses with flexible financing, affordable consulting services, and venture capital
Angel Investors
Individual investors are groups of experienced investors who provide funding for start-up businesses
Venture capital
Financing obtained from investment companies that specialize in financing small, high growth companies and receive an ownership interest and a voice in management in return for their money
Business Development Bank of Canada BDC
A bank that provides small and medium-sized businesses with flexible financing, affordable consulting services, and venture capital
How can potential business owners find new business ideas?
Many Executives get ideas for their companies while working in the same or related industry, other sources of inspiration or personal experiences as a consumer, hobbies and personal interest, suggestions from customers, family, and friends, and college courses and other education. Reading entrepreneurship and small-business magazines along with visiting their websites regularly is an excellent way to keep up with trends.
Why is it important to develop a business plan? What should a plan include?
If you require financing for your startup business you need to find Angel Investors and create an interest for them a solid business plan to show potential for solid return on their Investments is a good way to start.
Plans should include the following: cover page, table of contents, executive summary, Target customers, competitor analysis, description of company, product or service plan, marketing plan, operations and development plan, management team, critical risks, offering, exit strategy, financial plan, and finally the appendix of supporting documents.
What financing options do new business owners have?
Loans, government-sponsored programs, 3F, venture capitalist, short-term loans, line of credit, and reinvesting profits or selling off shares of the company
Summarize the risks of business ownership
Tech risks: is the idea possible? How long will it take, how much will it cost?
Management: can you pull off the idea? What’s your skill-set? Do you have the team to do it?
Market: are their customers that will use the product or service?
Finance: loans, government-sponsored programs, three F’s, venture capitalist, short-term loans, line of credit, and reinvesting profits or selling off shares of the company
How is the Internet affecting small business?
Internet driven entrepreneurs are 25% more likely to be women and 25% more likely to be university-educated customers are more comfortable with technology technology is not only having a significant impact on traditional business but also providing new opportunities to start a business many internet users are either starting internet based businesses or buying from them. The popularity of eBay and other e-commerce sites of giving the rise to a new kind of entrepreneur, mumpreneur X corporate professionals using web driven businesses specializing in the sales of specific items.
How did the economic crisis of 2008 and 2011 encourage some to become business entrepreneurs?
The crisis of 2008 and 2011 and the economic challenges that began in 2014 resulted in many people without jobs, well for the most part this was devastating for Summit provided the motivation to live their dream and start their business. Some entrepreneurs feel that small businesses offer more Financial Security than larger corporations that have the potential to lay off employees. Small businesses are in the hands of the owners while large businesses are in the hands of other people.
Partnership
An association of two or more individuals who agree to operate a business together for profit
General partnership
A partnership in which all Partners share in the management and profits, each can act on behalf of the company and has unlimited liability for all its business obligations
Limited partnership
A partnership with one or more General Partners who have unlimited liability and one or more limited partner whose liability is limited to the amount of their investment
General partners
Partners who have unlimited liability for all of the company’s business obligations and who control its operations
Limited partners
Partners whose liability for the company’s business obligations is limited to the amount of their investment, helped to finance the business but do not participate in the company’s operations
Limited liability partnership LLP
Partnership in which each partner is protected from responsibility for the acts of other partners and each party’s liability is limited to harm resulting from the Partys own actions
Corporation
Legal entity with its own rights and responsibilities separate from its shareholders, who therefore are not personally liable for the entities actions and liabilities
Public corporation
Corporation who shares are widely held and available to the General Public
Private Corporation
Corporation whose number of shareholders is limited, normally restricts the transfer of shares to third parties, and shares do not trade on a recognized Stock Exchange
Shareholders
The owners of a corporation who hold shares of stock, share or shares, that provide certain rights, also known as stockholders
Board of directors
A group of people elected by the shareholders to handle the overall management of a corporation, such a setting major corporate goals and policies, hiring corporate officers, and overseeing the company’s operations and finances
One-person Corporation
A corporation with only one person as a shareholder common and professional practices, examples such as medical doctors, accountants, or lawyers, and in trades such as plumbers and electricians
Crown corporations
Companies that only the provincial and federal governments can set up
Cooperative
A legal entity typically formed by people with smaller interest such as suppliers or customers to reduce costs and gain economic power, has limited liability, and unlimited lifespan, and elected board of directors, and an administrative staff, all profits distributed to the member owners in proportion to their contributions.
Joint venture
Business agreement in which two or more businesses agree to pool their resources for specific project or business venture
Franchising
A form of business organization based on a business Arrangement between a franchisor, which supplies the product concept, and the franchisee, which sells the goods and services of the franchisor in a certain geographic area
Franchisor
Franchising Arrangement, the company that supplies the product concept to the franchisee
Franchisee
Franchising arrangement to the individual or company that sells the goods or services of the franchisor in a certain geographical area
Franchise agreements
Contract setting out the terms of a franchising agreement, including the rules for operating a franchise, the service provided by the franchisor, and the financial terms, under the contract, the franchisee is allowed to use the franchisor’s business name, trademark, and logo
Merger
Combination of two or more companies to form a new company, which often takes a new corporate identity
Acquisition
The purchase of one company by another company or by an investor group, the identity of the acquired company might be lost
Friendly takeover
I take over that is supported by the management and board of directors of the targeted company
Hostile takeover
I take over that goes against the wishes of the target company’s management and board of directors
Horizontal merger or acquisition
Merger or acquisition involving companies at the same stage of the supply chain in the same industry, done to reduce cost, expand product offerings, or reduce competition
Vertical mergers and acquisitions
Mergers or Acquisitions involving companies at different stages of the supply chain in the same industry, done to gain control over supplies of resources or to gain access to different markets
Conglomerate merger or acquisition
Emerger or an acquisition involving companies in unrelated businesses done to reduce risk
Leveraged buyout LBO
Corporate takeover Finance buy large amounts of borrowed money, can be done by outside investors or by a company’s own management
What is sole proprietorship a popular form of business organization?
Easy and inexpensive to form Profits all go to the owner Direct control of the business Relative freedom from government regulations No special taxation Ease of dissolution
What are the drawbacks of sole proprietorship?
Unlimited Liability Difficulty in raising capital Limited managerial experience Trouble finding qualified employees Personal time commitment Unstable business life Losses are the owners responsibility
How does partnership differ from a sole proprietorship?
While sole proprietorship relies on only 1 owner a partnership adds layers of complexity such as: Potential conflict between partners, complexity of profit sharing, difficulty exiting or dissolving a partnership
What are the three main types of partnerships?
General - All parties share management and profits, all act on behalf of the company and have unlimited liability
Limited - Includes one or more general partners with unlimited liability along with one or more partners with limited liability based on their initial investment.
Limited Liability - Each partner is protected from the responsibility and acts of other partners, each parties liability is limited to harm resulting from that parties own actions.
What are the three main advantages and disadvantages of a partnership?
Advantages
1) Ease of formation
2) Availability of capital
3) Diversity of skill and expertise
Also: Flexibility, No Special Taxes and Relative freedom from gov’t control
Disadvantages
1) Unlimited liability
2) Potential for conflicts between partners
3) Complexity of profit sharing
Also: Difficulty exiting or dissolving a partnership
What is a corporation? Describe how they are formed and structured.
A company or group of people authorized to act as a single entity (legally a person) and recognized as such in law, who therefore are not personally liable for it’s debts.
They are formed as Shareholders who elect Directors who hire Top Management/Officers (President, Vice President, Treasurer an Secretary)
What are the advantages and disadvantages of corporations?
Advantages:
Limited liability, Ease of transferring ownership, Unlimited life, Ability to attract financing, Ability to attract potential employees
Disadvantages:
Double taxation of profits, Cost and complexity of formation, More government restrictions, Losses not written off.
What is a cooperative and what are the advantages to the membership?
A cooperative is a legal entity with several corporate features, such as limited liability for the membership, an unlimited lifespan, an elected board of directors and an administrative staff.
Advantages:
Helps improve the quality of life and economic opportunities by providing members with credit/financial services, energy consumer goods, affordable housing, telecommunications and other services.
How do cooperatives differ from other forms of ownership?
Cooperatives primary focus is to meet the common needs of their members, whereas the primary focus of investor owned businesses is to maximize the value of the company.
One member one vote as opposed to votes per amount of shares
Profits are based on the extent to which members use the cooperative as opposed to number of shares
What are the benefits of joint ventures?
Benefits are:
- Large projects are easier to handle
- Gain access to new markets, products and technology
Describe franchising and the main parties to the transaction?
Franchising is a business organization based on an agreement between a franchisor and a franchisee. The franchisor offer a per-packaged business with proved products/services for a fee and the franchisee retains an agreed upon % of profit from net sales.
Summarize the major advantages and disadvantages to franchising
Advantages:
- Increased ability for franchisor to expand (investment $ comes from franchisee)
- Recognized name, product and operating concept
- Management training and assistance
Disadvantages:
- Loss of control (less decision making ability)
- Cost of franchising (may incl. expensive equip and facilities)
- Restricted operating freedom (strict rules, design, inventory and supply standards)
Different types of mergers and buyouts
Horizontal - Businesses same stage of supply chain
Vertical - Businesses different stage int he supply chain
Conglomerate - Companies in unrelated business
Leveraged Buyouts (LBO’s) - Corporate take-over financed by large amt of borrowed money
Management
Process of guiding and directing the development, maintenance, and allocation of resources to attain organizational goals
Efficiency
Using the least amount of resources to accomplish the organization’s goals
Effectiveness
Ability to produce the desired results are Goods
Leadership
Relationship between a leader and the followers who want real changes, resulting in outcomes that reflect their shared purposes
Planning
Process of deciding what needs to be done to achieve organizational objectives, knowing what is needed to accomplish these objectives, identifying when and how it will be done, and determining by whom it should be done
Strategic planning
Process of creating long-range, 1 to 5 years, broad goals for the organization and determining what resources will be needed to accomplish these goals
Mission
Organizations purpose and reason for existing, its long-term goals
Mission statement
Clear, concise articulation of how the company intends to achieve its Vision, how it is different from its competition and the keys to its success
Tactical planning
Process of beginning to implement a strategic plan by addressing issues of coordination and allocation of resources to different parts of the organization, has a shorter time frame, less than 1 year, and more specific objectives than strategic planning
Operational planning
Process of creating specific standards, methods, policies, and procedures that are used in specific functional areas of the organization, helps guide and control the implementation of tactical plans
Contingency plans
Plans that identify alternative courses of action for very unusual or unforeseen situations and simply won the assumptions on which the original plan is built do not hold true
Organizing
Process of coordinating and allocating a company’s resources to carry out its plans
Top management
Highest level of managers, including CEOs, presidents, and vice presidents, they develop strategic plans and address long-term issues
Middle management
Managers who design and Carry Out tactical plans in specific areas of the company
Supervisory management, operational management
Managers who design and Carry Out operational plans for the ongoing daily activities of the company
Leading
Process of directing, guiding, and motivating others towards the achievement of organizational goals
Power
Ability to influence others to behave in a particular way
Legitimate power
Power that is derived from an individual’s position in an organization
Reward power
Power that is derived from an individual’s control over Rewards
Coercive power
Power that is derived from an individual’s ability to threaten negative outcomes
Expert power
Power that is derived from an individual’s extensive knowledge in one or more areas
Referent power
Power that is derived from an individual’s personal Charisma and the respect or admiration the individual inspires
Leadership style
The relatively consistent way in which individuals in Leadership positions attempt to influence the behavior of others
Autocratic leaders
Directive leaders who prefer to make decisions and solve problems on their own with little input from subordinates
Participative leaders
Leaders that share decision-making with group members and encourage discussion of issues and Alternatives, includes Democratic, consensual, and consultative styles
Democratic leaders
Leaders who solicit input from all members of the group and then allow the members to make the final decision through a vote
Consensual leaders
Leaders who encouraged discussion about issues and then require that all parties involved agree to the final decision
Consultative leaders
Leaders who confer with subordinates before making a decision but retain the final decision-making Authority
Free-rein leadership (laissez faire)
Leadership style in which the leader turns over all Authority and control to subordinates
Empowerment
Process of giving employees increased autonomy and discretion to make decisions, as well as control over the resources needed to implement those decisions
Corporate culture
Set of attitudes, values, and standards of behavior that distinguishes one organization from another
Controlling
Process of assessing/evaluating the organization’s progress towards accomplishing its goals, includes monitoring the implementation of a plan and correcting deviations from it
Informational roles
Managers activities as an information gatherer, information discriminator, or a spokesperson for the company
Interpersonal roles
Managers activities as a figurehead, company leader, or liaison
Decisional roles
Managers activities as an entrepreneur, a resource allocator, a conflict resolver, or a negotiator
Programmed decisions
Decisions made in response to frequently occurring routine situations
Non programmed decisions
Responses to infrequent, unforeseen, or a very unusual problems and opportunities where the manager does not have a precedent to follow in decision-making
Tactical skills
Managers specialized areas of knowledge and expertise, as well as the ability to apply that knowledge
Human relations skills
Managers interpersonal skills that are used to accomplish goals through the use of Human Resources
Conceptual skills
Manager’s ability to view the organization as a whole, understand the various parts are interdependent, and assess how the organisation relates to external environment
Global Management skills
Manager’s ability to operate in diverse cultural environments
What are the four key functions of managers?
Planning, leading, organizing, controlling
What is the difference between efficiency and effectiveness?
Efficiency is using the least possible amount of resources to get to work done = doing it right
Effectiveness is the ability to produce a desired result = doing the right thing
How are management and Leadership connected?
Leadership is intricately connected to management but they are not the same thing, leadership implies a relationship between a leader and those who follow. While managers are concerned with managing the tasks, getting the job done.
What is the purpose of planning, and what is needed to do it effectively?
Planning begins with the anticipation of potential problems or opportunities that the organization might encounter, managers design strategies to solve these problems and prevent future ones or take advantage of opportunities.
Effective planning requires the extensive information about the external business environment in which the company operates, as well as the internal environment
Explain the managerial function of organizing. What is the managerial pyramid?
Organizing is the process of coordinating and allocating a company’s resources to carry out its plans which includes developing a structure for people, positions, departments, and activities within the company.
A managerial pyramid consists of top management, middle management, and supervisory management
What are the five power bases?
Legitimate power, reward power, coercive power, expert power, and referent power
How do leaders influence other people’s behavior?
Leaders influence other people’s behavior by reacting to people and situations in a particular way, this pattern of behavior is referred to as leadership style. Leadership styles can be placed on a Continuum that encompasses three distinctive Styles:
Autocratic
Participative
Free rein
Describe the Control process.
The Control process involves five steps:
1) set performance standards and goals
2) measure performance
3) compare actual performance to established performance standards
4) take corrective action
5) use information gained from the process to set up future performance standards
Why is the Control process important to the success of the organization?
It helps managers to determine the success of the three functions: planning, organizing, and leading. Second Control Systems direct employee Behavior towards achieving organizational goals. Third, Control Systems provide a means of coordinating employees activities and integrating resources throughout the organization
What are the three types of managerial roles?
Informational roles, interpersonal roles, decisional roles
List the four steps in the analytical and Creative decision making process
Problem or opportunity recognition
Incubation
Illumination / Insight
Verification and implementation
Define the basic managerial skills
Technical skills, human relations skills, conceptual skills, Global Management skills
