Business Environments Flashcards
Concept of a Business
Define ‘Business’.
The specific processes that add value to an economic society or to the particular country in which it operates.
What does a business do that helps improve peoples general standard of living?
Businesses create employment.
What does ‘Business operations’ refer to?
To activities performed in the private and public sectors.
What are all the characteristics of a successful business?
- Strong leadership
- Competitive advantage.
- Satisfy the customers.
- Uses the four factors of production.
- distributes profits to owners/shareholders
- develops employees through skills training
- uplifts the community
- pays taxes
What are the important objectives of a business to be able to survive?
- be aware of external threats.
- decisions should be assessed
- Uses factors of production sustainably.
- Make astable working environment.
- The ability of the business.
What does ‘Feasibility’ mean?
The idea/opportunity that is considered ‘’workable’’ and whether it can be practically implemented.
What does the ability of the business consist of?
– top management
– plan for the future
- A business will formulate a vision to indicate its long-term dream.
- It will translate the company’s vision into a mission statement which will indicate what needs to be done currently to achieve the long-term dream
-Long-term and short-term goals will ensure the business stays on track.
What is Profitability and Growth?
- The entrepreneur starts a business to make a profit and the long-term objective of any business is financial success. Financial success means the business will grow.
- To improve profitability, management has to manage resource allocation and monitor the overall direction of the business. Viability should always be kept in mind.
What does Viability mean?
Does the idea/opportunity that is considered have the potential to generate sustainable profits and a Return on Investment?
In order for a business to grow, what does it need to do?7
- higher sales volumes and reduced expenses.
-use physical assets
-develop skills and empower employees.
What does Productivity and Efficiency consist of?
- Productivity is the ability of the business to achieve the maximum output with the minimum input.
- Efficiency refers to the ability of a business to satisfy customers’ needs and wants at the right time, price, and place.
To improve both productivity and efficiency, it is important to ensure constant planning and optimally allocate resources to minimize wastage, thereby improving profitability.
How do you Create and maintain a Competitive Advantage?
Quality
Price
Use of technology
Service levels
Use of 4 factors of production
The location of the business.
Employee development and relationships?
Ensure employees are confident
Motivated and committed employees will grow the business.
Employees should tolerant of differences.
Employees should communicate in a constructive manner about their ideas and even differences.
Time management skills are crucial, especially where the output of one employee becomes the input of the second employee.
How do businesses differentiate themselves from their competitors?
Businesses are using technological developments to differentiate themselves.
What is Social Responsibility?
Social responsibility is about the business acting in an accountable and ethical manner even in activities where profit is not the main driving force.
