Intro to Business Management test Flashcards
Why do we use stakeholder mapping?
To determine the key stakeholders of an organization based on the varying degrees of power and interest.
what does SWOT stand for
Strengths, weaknesses, opportunities, threats
what does STEEPLE stand for
Social, technological, economic, ethical, political, legal and environmental.
why do we use SWOT analysis
to consider a business opportunity (merger/acquisition) and its “pros and cons”
why do we use the STEEPLE analysis
It examines the influence in the external environment in which a business operates.
what is a business ?
It exists to satisfy the wants and needs by selling goods and services, usually in return of profit
What is a mission statement?
A statement ro share who the company is and what they do
what is a vision statement ?
It states what the company would like to become and what they would like to accomplish. (future plans)
What is a SMART goal?
It is Specific, Measurable, Agreed, Realistic and Time specific.
what are two sectors businesses can be in?
private sector, public sector
what is the private sector
it consists of businesses owned and ran by private individuals and organizations.
what are private sector businesses working towards
they are usually aiming to earn profit for their owners
what is the public sector
it consists of organizations ran by regional and/or national government.
what are public sector businesses working towards
they are usually aiming to provide essential goods and services to the general public.
what is a company
Any business organization that is owned by its shareholders who have limited liability.
are companies privately or publicly held
they can be both
what are cooperatives
For-profit social entreprises owned and ran by their members (employees, managers, customers…)
what is the main goal of cooperatives
creating value for their member-owners.
what is a deed of partnership
a legally binding contract that all joint owners sign; it states the purpose of the business, the rights of the partners, how profit should be split…
what is an incorporation
it means that there is a legal difference between the owners of a company (shareholders and the business entity itself)
why do incorporations exist
they ensure that the owners are protected by limited liability.
what does IPO stand for
initial public offering
what is an IPO
it occurs when an organization sells all or a part of its business to shareholders on a public stock exchange for the first time. It changes
what does the legal status of a business change to after an IPO
they become a publicly held company
what is limited liability
the legal status of a business that enables its shareholders not to be liable for more than the original amount of money invested in the business. (apple is being sued–> stockholders don’t pay)
what is unlimited liability
the owners of a business (sole traders or partners) are personally liable for any business debts, even if it requires the debt to be settled by selling off personal assets (small pizzeria being sued–> the owner might have to pay from his pockets)
what is a limited partnership
a special type of partnership where one or more partners contribute capital and enjoy a share off the profits but don’t participate in the running of the business
what are NGOs
non-governmental organizations are a type of non profit organizations operating in the private sector of the economy for the benefit of others in society.
what is a partnership
business alliance consisting of between 2 and 20 individual owners who are jointly responsible for the business.
what is a sleeping/silent partner
an investor in a partnership who doesn’t get involved in the daily running and management of the organization.
what is a sole trader
organization which is owned by a single who has exclusive responsibility for the running of the business.
what is a free market
system that is controlled by the internet forces of supply and demand, as opposed to one regulated by government controls. in this market, companies and resources are owned by private individuals or entities who are free to trade contracts with each other.
what is an oligopoly
a market structure wherein only a select few participants compete with each-other.
what is a monopoly
market where only one firm is the sole supplier of certain goods or services.
what is a monopsony
market condition in which there is only one buyer.
what does MNC stand for
Multi National Company
what are MNCs
they are business organizations that have operations overseas, respective of whether it produces/sells goods or/and provide services.
what is a stakeholder
people who have an interest in a company and can either be affected by the business or affect it.
what is the triple bottom line
the combination of economic sustainability. social sustainability and ecological sustainability.
what is economic sustainability
the need to use available resources and raw materials to their best advantage. Ultimately ensuring profitability and financial performance.
what is social sustainability
the need to take human factors into account both internally and externally when making business decisions.
what is ecological sustainability
the need to take ecological factors into account when making business decisions.
what is a circular business model
focuses on the long term environmental consequences and sustainability matters related to business activities. (profitability vs. people/planet)
what is a traditional business model
focuses on costs, revenues, profit related to businesses activities with more of a short term outlook
what are some common business objectives
growth, profit, protecting shareholder value, ethical objectives…
What are economies of scale
term that describes a competitive advantage that large entities have over smaller entities
why are larger entities advantaged
they can allow bulk purchases, can use ships for shipping…
example of positive impacts of mncs
employment opportunities, they offer choice and quality…
example of negative impacts of mncs
exploitative business practices, negative impact on local businesses…
what is the quaternary sector
refers to business activity involving the creation or sharing of knowledge and information.
what are the different sectors
primary ( farming, mining, forestry) secondary (manufacturing) tertiary (services) and quaternary (sharing knowledge info ex: education)
