Chapter 1 - The Changing Face of Business Flashcards
Business
All profit-seeking activities and enterprises that provide goods and services necessary to an economic system.
Profits
Rewards for businesspeople who take the risks involved in blending people, technology, and information to create and market want satisfying goods and services.
Not-for-profit
Organizations that have primary objectives of public service over profits.
Factors of production
The basic inputs for a successful operation. The 4 factors of production are natural resources, capital, human resources and entrepreneurship.
FoP 1: Natural resources
Inputs that are useful in their natural states. This includes land, forests, and minerals.
FoP 2: Capital
Technology, tools, information, facilities, machines and equipment.
FoP 3: Human resources
Production inputs including anyone who works, including both the physical labour and intellectual inputs contributed by workers.
FoP 4: Entrepreneurship
The willingness to take risks to create and operate a business
Capitalism (Private Enterprise System)
Capitalism is an economic system that minimizes government interference in economic activity and rewards businesses for their ability to perceive and serve the needs of customers.
Competitive differentiation
The unique combination of organizational abilities, products, and approaches sets a company apart from competitors in the minds of consumers.
Basic rights in the private enterprise system
1) Right to private property
2) Business owners’ right to after-tax profit
3) Freedom of choice in employment, purchases, and investments
4) Right to fair competition
The entrepreneurship alternative
Entrepreneurs are risk-takers who recognize marketplace opportunities and use their skills and capital to seize and profit from those opportunities.
Changes in the workforce
- Aging population
- Shrinking labour pool
- Diversity in the workplace
- Changing nature of work
- Need for flexibility and mobility
- Collaboration to innovate
Diversity
Blending individuals of different genders, ethnic backgrounds, cultures, religions, ages, and physical and mental abilities.
Outsourcing
Using outside vendors to produce goods or fulfill services and functions that were previously handled in-house
Offshoring
The relocation of businesses to lower-cost locations overseas.
Nearshoring
Outsourcing production or services to nations near a firm’s home base.
Vision
The ability to perceive marketplace needs and what an organization must do to satisfy those needs.
To thrive in the 21st century, vision is crucial.
Critical thinking
The ability to analyze and assess information to find problems or opportunities.
Creativity
The capacity to develop novel solutions to organizational challenges.
In business, creativity refers to the ability to see better and different ways of doing business.
Ability to lead change
Managers must be aware of both internal and external causes for change, and they must be effective when it comes to helping the organization and its people adapt and move towards common goals.
What makes a company admired?
- Solid profits
- Stable growth
- Safe and challenging work environment
- High-quality products
- Strong ethics and social responsibility
Business ethics
The standard of conduct and moral values that are involved in distinguishing right from wrong actions in the work environment.
Social responsibility
Management philosophy that includes:
- contributing resources to the community
- preserving the natural environment
- developing or participating in nonprofit programs designed to promote the well being of the general
