ib exams Flashcards
BUSINESS FUNCTION: Human resources
Handles all aspects related to the workforce. In charge of recruitment, training, promotion, dismissal of staff, etc.
BUSINESS FUNCTION: Finance and accounts
Ensures the business has sufficient funds in order to conduct its daily operations
BUSINESS FUNCTION: Marketing
Identifies the needs and wants of the customers and provides ways to meet those requirements
BUSINESS FUNCTION: Operations management
Makes the goods and provides the services from their resources. In charge of ensuring that they meet production targets, deadlines, and quality standards.
Primary sector
The business sector involved with extracting natural resources (farming, fishing, mining)
Secondary sector
The business sector involved with the manufacturing or construction of finished products (construction, engineering, food processing)
Tertiary sector
The business sector involved with providing services to customers (banking, retail, health care)
Quaternary sector
The business activity involved with the creation or sharing of knowledge and information using digital technologies
Entrepreneurs
Own their own business, able to take risks
Intrapreneurs
Take the initiative on implementing new ideas in order for the business to thrive and remain competitive
Private sector
Businesses owned by private individuals/organizations that aim to earn a profit (sole traders, partnerships, limited liability companies)
Public sector
Businesses controlled by the government aiming to provide resources/services to the general public (education, emergency services, health care services)
SMART
Specific, measurable, achievable, realistic and tactics
SWOT
SWOT: Strengths, weaknesses, opportunities, and threats. Advantages: helps develop a better understanding of an organization’s position in the market. Disadvantages: SWOT does not guarantee the strategy will be successful, only provides a snapshot of the current situation for an organization.
ANSOFF’S MATRIX: Market penetration
Existing market, existing products
ANSOFF’S MATRIX: Market development
Existing products, new market
ANSOFF’S MATRIX: Product development
New products, existing market
ANSOFF’S MATRIX: Diversification
New products, new market
Internal stakeholder types
Employees, managers, shareholders
External stakeholder types
Customers, suppliers, local community, pressure groups, the government
STEEPLE/PESTLE
Social, technological, economic, ethical, political, legal, environmental. Advantages: helps managers plan more strategically, enables the business to identify opportunities and threats.
Economies of scale
Enables a business to benefit from lower average costs (the cost per unit) by increasing the size of its operations
Diseconomies of scale
Causes the firm’s average costs of production to rise, occurs if the firm grows beyond its ability to operate efficiently
Marketing mix
Product, price, promotion, place
Types of pricing strategies
Psychological pricing, price discrimination, price leadership, loss leader
The product life cycle (PLC)
PLC is the stages a product goes through - research & development, launch, growth, maturity, decline
Internal (organic) vs external (inorganic) growth
Internal: growing w/o help of an external partner. External: organization needs help from a partner organization to grow.
Co-operative
For-profit social enterprise owned/managed by its members
Capital expenditure
Purchase of fixed assets that will generate revenue over a longer period of time
Revenue expenditure
Short-term expenses running daily operations
Below/Above the line promotion
Below does not use external media agents, above does use external media agents
Cost-plus pricing
Determining the price of a product based on the business’ unit costs
Limited liability/Unlimited liability
Limited: shareholders are not liable for more than original amount of money invested. Unlimited: owners of business are responsible for debts even if it comes from personal assets.
Liquidity
How easily a business can convert assets into cash
Return on capital employed (ROCE)
Profitability ratio that measures a firm’s efficiency/profitability in relation to its size
Social enterprises
Revenue generating businesses with community benefiting objectives
Supply chain
Managing sequence of activities from production to being delivered to customer
Zero-channel distribution network
Sells directly to consumer
