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Business Management 1 > Introduction To Business Management > Flashcards

Introduction To Business Management Flashcards

1
Q

What is a business?

A

An organisation that is involved in industrial, professional or commercial activities

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2
Q

What does it mean for a business to have a competitive advantage?

A

A business is able to offer something unique, or offer a cheaper product/service than its competitors

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3
Q

What are products?

A

Items that are tangible in nature

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4
Q

What is a service?

A

An intangible activity

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5
Q

What is a need?

A

Anything needed for survival

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6
Q

What is a want?

A

Goods and services a person finds desirable.

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7
Q

What is buying power?

A

The ability to purchase a product or service

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8
Q

What is demand?

A

When a person has a need or a want and the ability to purchase something to satisfy that need or want

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9
Q

What is the first tier of Maslow’s hierarchy of needs?

A

Physiological needs

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10
Q

What is the second tier of Maslow’s hierarchy of needs?

A

Safety needs

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11
Q

What is the third tier of Maslow’s hierarchy of needs?

A

Love/belonging needs

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12
Q

What is the fourth tier of Maslow’s hierarchy of needs?

A

Esteem needs

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13
Q

What is the fifth tier of Maslow’s hierarchy of needs?

A

Self-actualisation

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14
Q

What is limited resources?

A

Restricted quantities of inputs that may be required by a business

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15
Q

What is scarcity?

A

Insufficient goods, resources or abilities to achieve the desired end

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16
Q

What are the 4 factors of production?

A

Capital
Land
Labour
Entrepreneurship

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17
Q

What is an economic system?

A

The organisations and methods used to determine what goods and services are produced, how they are produced and for whom they are produced.

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18
Q

What are the 4 economic systems?

A

Traditional
Command
Market
Mixed

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19
Q

What is the traditional system?

A

System whereby people produce only what they need for themselves, which requires people to barter with one another

20
Q

What is the command system?

A

System whereby all factors of production are state-owned and controlled, and all supply, demand and pricing are planned by the state

21
Q

What is the market system?

A

System whereby anyone is free to start and run a business in the way they see fit. It is characterised by the ‘invisible hand’ of market forces, i.e., supply, demand and competition

22
Q

What is the mixed system?

A

System that includes elements of both command and market systems. Major areas are controlled by government; minor areas are controlled by individuals

23
Q

What is a business sector?

A

The type of activity that a business predominantly performs

24
Q

What does the primary sector involve?

A

Mostly unskilled labour attaining raw materials to be used in production

25
Q

What does the secondary sector involve?

A

Mostly semi-skilled labour transforming raw materials into goods and services

26
Q

What does the tertiary sector involve?

A

Mostly highly skilled labour engaging in the end-user sale of goods and services

27
Q

What are the two sections of the business environment?

A

The internal environment and the external environment

28
Q

What is the micro-environment?

A

The internal factors within a business that may impact its activities and success

29
Q

What are the internal factors of the micro-environment?

A

Vision and mission
Goals and objectives
Culture
Diversity
Ethics
Manner in which it desks with change

30
Q

What are the 8 functions within the micro-environment?

A

General management
Purchasing
Logistics
Marketing
Finances
Human resources
Public relations
Administration

31
Q

What is the market environment?

A

The external factors that affect influence a business but that can also be included by the business

32
Q

What are the 5 factors of the market environment?

A

Suppliers
Publics
Customers
Competitors
Market intermediaries

33
Q

What are the 6 types of publics?

A

Media publics
Government publics
Local publics
Internal publics
Citizen-action publics
General publics

34
Q

What is a public?

A

Any group that has an actual or potential interest in, or impact on, an organisation’s ability to achieve its objectives

35
Q

What are market intermediaries?

A

Businesses that help a firm to promote, sell and distribute its goods to final buyers

36
Q

What is the macro-environment?

A

General environment that can affect the working of all business enterprises. They are forces outside of a business’s control

37
Q

What are the forces of the macro-environment?

A

Demographic forces
Economic forces
Technological forces
Natural forces
Political forces

38
Q

What does environmental scanning do?

A

It allows businesses to observe the industry and attempt to establish and evaluate its position within it

39
Q

What are 3 methods of environmental scanning?

A

SWOT analysis
PESTLE analysis
Porter’s Five Forces analysis

40
Q

What does SWOT analysis determine?

A

A business’s position in relation to the market

41
Q

What is a PESTLE analysis used for?

A

To identify opportunities and threats to a business

42
Q

What are the 2 steps of a PESTLE analysis?

A
  1. Collect information about the 6 PESTLE categories
  2. Identify which of the factors pose threats and opportunities to the business
43
Q

What is a Porter’s Five Forces analysis used for?

A

To determine industry profitability

44
Q

What are Porter’s Five Forces?

A

Threat of substitutes
Threat of new entrants
Bargaining power of suppliers
Bargaining power of buyers
Rivalry among existing firms

45
Q

What are the 6 barriers of entry?

A

Economies of scale
Product differentiation
Capital requirements
Cost advantages independent of size
Access to distribution channels
Government and legal barriers

46
Q

What are economies of scale?

A

Situations where the more a business produces accumulatively, the cheaper its cost per unit of production

Business Management 1 (10 decks)

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