Chapter 2 Flashcards
Define an external environnement
Factors beyond organization’s boundaries, cannot be controlled, ex competition
Define organizational boundaries
Separates organization from environment
Name the types of organizational enviro. (7)
Economic, technological, political-legal, socio-cultural, business, global, emerging challenges/opportunities
What are the key goals in an economic enviro.?
economic growth, stability, full employment
List the factors o economic growth (8)
Business cycle, aggregate output, standard of living, GDP, GNP, productivity, balance of trade, national debt
Define the business cycle
Depression,recovery, (expansionary) PEAK, recession, trough (contractionary), recovery
Define an aggregate output
Measure of economic growth, total quantity of goods and services produced by economic system during given period
Define standard of living
Total quantity/quality of goods and services that a country’s citizenscan purchase with $$
Define productivity
Measure of economic growth comparing the output of system with resources needed to produce output; standard of living improves through p increase
How is economic growth measured
GDP (gross domestic product) and GNP (gross national product)
Define GDP
Value of all g/s produced by national economy within given period with domestic factors of production ex: real growth rates, GDP per capital, real GDP
Define GNP
Value of all g/s produced by national economy within peri od given regardless of production location
Define balance of trade
Exported product value minus imported products
Define national debt
Amount of money govt owes creditors; increase or decreased based on budget surplus or deficit
Define economic stability
Condition where amount of money available vs quantity of g/s produced grows at same rate
What are threats to economic stability
‘inflation, deflation, unemployment
define inflation
Widespread price increases in economic system
What is CPI
Tool used to measure inflation (consumer price index)
Define deflation
Period of generally falling prices
Define unemployment
Level of joblessness among people actively seeking jobs an economic system
What are the types of unemployment (4)
Frictional, seasonal, cyclical, structural
What arepolicies helping to manage Canadian economy
Fiscal (taxes, spending) and monetary (money supply ie. Interest rates) = stabilization policies
Define technology
All ways a company creates values for its customers (ex: knowledge, work methods, physical equipment)
Define research and development (R&d)
Provides new ideas for product services and processes; basic Vs applied
What is the political-legal environment
Relationship between business and govt ex: pro or anti-business sentiment, political stability, internation relations
Define socio-cultural environment
Customs, values, attitudes, demographic characteristics of society where org. Functions; customer preferences/tastes vary across and within national boundaries; ethical compliance, responsible business behaviours
Define “Porter’s five forces” and its components
model used to analyze competitive situation in an industry; bargaining power of suppliers + threat of substitutes+ bargain in power of consumers + threat of new entrants + industry rival
What are core competencies?
Skills, resources org. Uses to compete best and create most value for owners
Define outsourcing
Paying suppliers, distributors to perform certain business processes
What role does social media play today?
Integral part of daily communication
How is business process management changing?
Moving from department-oriented organizations to process-oriented teams
What are types of mergers/acquisitions? (3+2)
Horizontal, vertical, conglomerate; friendly, hostile takeovers
Define divestiture/spinoff
Selling part of existing business or setting it up as a new corporation
Define a friendly takeover
Acquired company welcomes acquisition due to needing cash or other benefits
Define a hostile takeover
Acquiring company buys enough of acquired company’s stock to take control
Define a poison pill
Defense tactic used by company management to make a company/firm look less attractive to stop from being taken over
Define ESOP
Employee stock ownership program, turning corporations into employee-owned
Define a strategic alliance
2 + companies temporarily join (called joint venture)
What is the link between subsidiary and parent corporations
Parent owns subsidiary
