Chapter One - SAC STUDY Flashcards
what are 3 characteristics of LSO’s?
- 200+ employees
- Earns revenue in the millions
- Multiple locations (stores)
what are 4 management functions? “Our Family Has Many Relatives”
operations - production of goods and services
Finance - management of financial aspects of the organisation
human resources - managing staff or employees
marketing - marketing mix (price, product, promotion, place)
research and development - innovation
what are 2 positive contributions LSO’s make to the economy?
contribution to employment
contribution to economic growth
what are 2 negative contributions LSO’s make to the economy?
- outsourcing
- damage to environment
what are 2 people in the internal environment and what interests may they have in the business? (employees and shareholders)
employees - if bus is profitable it creates opportunity for higher wages and lowers risk of outsourcing & downsizing which could make them redundant
shareholders - want the organisation that they have invested in to be profitable as they receive a proportion of the dividends
what are 2 external stakeholders and what interests may they have in a business? (suppliers and customers)
suppliers - if the company is performing well the supplier will be making more money
customers - expect high quality at competitive prices
what are 2 financial performance indicators?
number of sales
percentage of market share
what are 2 non-financial performance indicators
results of a customer satisfaction survey
level of staff turnover
what is a possible conflict between management and customers?
- management may attempt to maintain profit and high dividend to satisfy shareholders by raising the prices of products
- This will upset customers who expect reasonably priced products
what is a possible conflict between management and suppliers?
- management wishes to keep costs down to improve profit
- suppliers providing ethical materials require higher prices to cover their costs
who is included in the operating environment? (4)
- Customers - expect high quality at reasonable prices
- Suppliers - want business to do well so they make more money
- Competitors – organisations that offer rival products/services
- Trade unions
how can a business be socially responsible to customers?
ensuring their product is high quality and reasonably priced which will make customers happy
how can a business be socially responsible to suppliers?
develop good relationships with suppliers to ensure timely delivery
how can a business be socially responsible to members of the community? (2)
- show concern for the environment
- give back to the community (local sport events)
what is the responsibility of research and development department?
designing and developing new products or improving existing ones
Who is included in the internal environment? (4)
- Employees
- Managers
- Shareholders
- Corporate culture
Who is included in the macro environment? (PELTS)
- Political influences
- Economic influences
- Legal influences
- Technological developments
- Social attitudes
What are 2 things that make LSO’s unique?
- have a hige range and large numbers of stakeholders
- they operate in many countries
what is ‘contribute to economic growth’? (pos impact of LSO’s on economy) 2
- LSO’s produce huge amount and range of goods and services, which is measured by the GDP
- This grows the level of economic activity in Australia and builds wealth through their sales as exports overseas
what is ‘contribute to employment’? (pos impact of LSO’s on economy) 3
- LSO’s make a significant contribution to employment
- leads to those employees spending their income
- has a multiplier effect, generating benifits across the economy through their spending
what is ‘damage to the environment’? (neg impact of LSO’s on economy) 2
- mass production of goods and services, leads to waste and pollution in the environment
- this needs to be cleaned up by the government or other organisations, having a negative impact on the economy
what is ‘outsourcing’? (neg impact of LSO’s on economy) (3)
- Usually results in labour being used overseas, which leads to less wages overall being paid in Australia, reducing amount of money available for people to spend.
- This has a negative multiplier effect as theres less money to spend on the consumption of goods and services
- leads to less production and even fewer jobs.
