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3/4 BusMan > U3 AOS1 > Flashcards

U3 AOS1 Flashcards

Business Foundations

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1
Q

sole trader definition

A

an individual owner of a business entitled to keep all profits after tax has been payed but liable for all losses, operating under their own name or RBN.

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2
Q

sole trader features

A

 Simplest and most inexpensive
 Total responsibility for decisions, planning, operations
 Rights to all profits and capital
 Owner held totally responsible for all debts of the business unlimited liability.

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3
Q

partnership definition

A

legal form of business ownership, 2 or more people work together with a view of making a profit

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4
Q

partnership features

A

 2 types, general and limited partnership
 Combining expertise and resources of 2-20 people
 Each partner is jointly reliable for debts unlimited liability
 No perpetuity, not ongoing if a partner leaves/dies, new partnership must be formed.

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5
Q

private listed company features/definition

A
  • shown by (Pty Ltd)
  • seperate legal entity where there is a minimum of 1 shareholder and a max of 50 non-employee shareholders
  • limited liability
  • has perpetuity
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6
Q

public listed company definition/features

A
  • (Ltd)
  • separate legal entity
  • Used to increase number of shares and access to more capital.
  • Limited liability for debts incurred (separate legal entity)
  • Has perpetuity
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7
Q

social enterprise definition

A

private sector business that distributes profit to benefit the community rather than individual shareholders

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8
Q

social enterprise features

A

Uses strategies to maximise improvements in human wellbeing or the environment.
Aims to earn revenue while achieving social, culture, community, or environmental outcomes.

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9
Q

government business enterprise definition

A

government owned and operated, they seek to run profitably by controlling costs and selling their good at a price to cover costs

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10
Q

government business enterprise feature

A

Governments act as the shareholders and have a strong interest in their performance and financial returns.

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11
Q

business objectives

A

statements of desired achievement that provide direction for the business. Successful business would have had clear objectives established.

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12
Q

What is the acronym for businesss objectives, and what are the objectives

A

PMEEMSS

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13
Q

objective of to make a profit

A

the difference between revenue and expenses. If a business makes a profit, it may be considered successful
 Profits may be earned to unsure survival, growth and expansion over time.

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14
Q

objective of to increase market share

A

proportion or percentage of the market (and total sales) controlled by the business.
 Aiming to gain a greater percentage of the market through its sales resulting in an increased revenue stream.
 Buis should aim to maximise appeal of their product/service where possible.

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15
Q

objective of to improve efficiency

A

the best use of resources in the production of goods and/or services
 A buis should review and evaluate operations to determine improvements (whilst working with financial constraints of the business)

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16
Q

objective to improve effectiveness

A

degree to which a business achieves its stated objectives
 Businesses must have strategies in place to achieve stated objectives.
 They must also consider tools to use to assess whether the outcome meets the stated objectives.

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17
Q

objective of to fulfil a market need

A

set of actual or potential buyers of a product or service.
 It is important for a business to recognise and satisfy the needs of its market.
 This allows the business to increase profits and sell more products and services (enabling greater concentration on the size and type of market)

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18
Q

objective of to fulfil a social need

A

relate to the role of a business in the community.
 Going beyond the financial objectives, focusing on the business being a ‘good citizen’
 May relate to the provision of services, contribution to causes, provision of local job opportunities and focussing on the environment.
 Can also be promoted through policies and practices within the workplace.

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19
Q

objective of to meet shareholder expectations

A

shareholders expect to make a profit, for shares to increase in value and dividends to be paid.
 Shareholder: owner of a company, earn money for the business
 Stakeholders: an individual or a group that has direct or vested interest in the activities of a business e.g. employees, customers, competitors

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20
Q

stakeholder

A

An individual or a group that has a direct or vested interest in the activities of a business, can affect the operations of a business in a positive or negative way
*All shareholders are stakeholders, not all stakeholders are shareholders

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21
Q

what are the 7 stakeholders

A

owners/shareholders
managers
employees
customers
suppliers
competitors
general community/society

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22
Q

stakeholder interest of owner/shareholder

A

 Profitability of business
 Ethical operations via adoption of socially responsible behaviour
 (For shareholders) to receive dividends/increased share value

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23
Q

stakeholder interest of managers

A

 Involved in setting and achieving business objectives
 Fair remuneration and benefits
 Job satisfaction, secure position and career development opportunities
 Work for ethically and socially responsible business

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24
Q

stakeholder interest of employees

A

 Fair wage/salary provision
 Work for ethically and socially responsible business
 Opportunity for career development
 Gain of job satisfaction and security

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25
Q

stakeholder interest of customers

A

 To obtain high quality goods/services (products)
 Establish a relationship with the business
 To support Australian owned and Australian made
 Ensuring the business is acting in an ethically and socially responsible manner

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26
Q

stakeholder interest of suppliers

A

 Ensure their customers business is profitable because of their supply & 4 payment
 Value prompt payments
 Establish long term supplier preferred relationship

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27
Q

stakeholder interest of competitors

A

 Gain competitive edge over the business (greater market share)
 Differentiation of good or service
 Compare and evaluate performance against rival businesses

28
Q

stakeholder interest of the general community/society

A

 Benefit from employment opportunities provided by the business
 Participate in the community
 Ensure the business is an ethically and socially responsible citizen who considers the environment and sustainability in their operations

29
Q

what can conflicts between stakeholders occur about

A

 Profit/distribution of profit
 Prompt and fair payment
 Provision of good quality goods/supplies
 Consideration of CSR
 Environmental issues because of inputs, process or business outputs

30
Q

what are the 5 management styles from task to people oriented

A

Autocratic, Persuasive, Consultative, Participative, Laissez-Faire (CLAPP)

31
Q

autocratic management style define

A

all decision-making is centralised, there is little delegated authority and communication is one-way (downwards)

32
Q

features of an autocratic management style

A

 Desire for control
 Centralisation of decision making
 Task Emphasis, procedures must be followed
 Limited opportunities for change
 Communication from them at the top down
 Expectations of compliance, rewards (monetary) used to motivate staff,
 Don’t think staff will be motivate by kindness from employer, so they don’t bother

33
Q

persuasive management style define

A

managers make the decisions, then persuade workers of the benefits of those decisions

34
Q

features of a persuasive management style

A

 Desire for control
 Centralisation of decision making, decision explained to staff, emphasis on task
 Managers can interpret a situation and can convince staff to work towards achieving a goal in the way desired by the manager
 Some value placed on staff contributions
 Top-down communication
 Expectation of compliance, some limited opportunities for change

35
Q

consultative management style define

A

manager consults with employees when discussing an issue, however, the ultimate decision is made by the manager based on the suggestions and input received

36
Q

features of consultative management style

A

 Two-way communication as opinions and feedback are sought
 Consultation is important, staff performance linked to consultation process, a reasonable level of employee involvement in decision making
 Control is centralised but staff ideas are taken into an account
 Staff are more likely to perform when given a say

37
Q

participative management style define

A

decision making is performed as a team with management and staff working together, with the manager retaining responsibility and accountability

38
Q

features of a participative management style

A

 Decentralisation of control and authority
 Team/department/individual setting of objectives
 Focused on people, not task, encourages motivation as staff needs are met
 Trust in staff is high
 Open communication
 Positive corporate culture, staff contributions are valued

39
Q

laissez-faire management style define

A

leaves most of the decision making and running of the business to employees, they leave broad outlines of internal environment constraints are made known by management to employees such as budget, timelines, and objectives

40
Q

features of laissez-faire management style

A

 Employees are empowered to set own objectives, solve their problems, and make decision
 Teamwork is usual and communication is open and two-way
 Generally used in workplaces that have highly educated and skilled staff
 High levels of intrinsic motivation are common amongst such staff

41
Q

acronym for appropriateness of management styles, and what it stands for

A

MENT
- manager preference
- experience of employees
- nature of the task
- time

42
Q

appropriateness of time

A

 How much time is available is important when deciding which management style to use
 If a quick decision needs to be made, a task-oriented style such as autocratic could be justified
 If there is more time for discussion with employees and other stakeholders, an employee-oriented style could be more appropriate

43
Q

appropriateness of nature of task

A

 Manager considers the type of task that needs to be performed
 If tasks are simple, manager might quickly communicate what needs to be completed (task-oriented style)
 If tasks require more thought and discussion, may be more valuable to include employees in decision making process (employee-oriented approach)

44
Q

appropriateness of experience of employees

A

 If employees have vast experience and knowledge regarding a situation, the manager may rely on that experience and use the employee-oriented styles
 If employees lack experience and knowledge, they won’t be able to offer meaningful suggestions, in this instance the manager may decide to use more task-oriented style

45
Q

appropriateness of manager preference

A

 Many managers have a preferred style to use
 Some like to have full control over situations and would prefer the more task-oriented styles or autocratic and persuasive
 Other managers prefer to use the experience of employees by embracing the more employee oriented consultative, participative or laissez faire styles of management

46
Q

management skills acronym and what it stands for

A

CLIPDD

47
Q

management skill of communication define

A

process of creating and exchanging information between people (sender and receiver) that produces the required response

48
Q

features of management skill communication

A

 Used in internal and external business environments
 Communication must be effective, clear, concise, articulate
 Communication skills are vital to clarify tasks, explain business vision, dealing with suppliers and resolving conflict

49
Q

management skill of leadership define

A

skill of manager when guiding workers towards achieving a business’s goals

50
Q

features of the management style leadership

A

 Motivate, engage, inspire, communicate
 Act as a role model, and mentor
 Understand the skills of others
 Resolve conflict
 Be able to build teams and respond quickly to change

51
Q

interpersonal management skill define

A

skills used every day to communicate and interact with other people, individually and in groups

52
Q

interpersonal management skill features

A

 Be a team player, be able to motivate/encourage others
 Work effectively with others in internal and external environment
 Be empathetic and assertive
 Be a good communicator, be ethical, be honest

53
Q

planning management skill define

A

formalised decision-making process that is future oriented

54
Q

planning management skill features

A

 Ability to define business objectives and decide on strategies to achieve them
 Can assist business to reduce uncertainty about the future
Levels of planning:
 Strategic: long term 2-5 years, impacts direction & objectives that business pursues
 Tactical: medium term 1-2 yrs., implement strategic plan & quickly respond 2 change
 Operational: short term up to a yr., planning around rosters, reorganising

55
Q

delegation management skill define

A

passing of formal authority down the hierarchy to perform tasks and make decisions, responsibility remains with the person delegating

56
Q

delegation management style features

A

 Important to enable objectives of business to be attained
 Delegation builds trust, supports, motivates employees to learn new skills
 Clear communication to the subordinate to ensure they know what’s going on

57
Q

decision making management style define

A

multistep approach whereby a selection is made between a range of different alternatives

58
Q

decision making management skill features

A

 Ability to identify options available then choose a course of action
 Effective decision-making means to identify options and evaluate within a strict timeframe
 Using a systematic process when trying to reach a decision reduces the likelihood of overlooking important factors that should be considered

59
Q

relationship between management styles and management skills

A

 All managers have a particular style and al have skills.
 The types of style used will determine the skills that are used AND how they are used
 Every style of manager uses every skill, but they use it in a DIFFERENT WAY

60
Q

define corporate culture

A

system of shared values and beliefs of people within a business

61
Q

define official corporate culture

A

desired culture that a business wished to establish, and convey to the public

62
Q

how to see official corporate culture

A

 Formal written expression of the values and beliefs of the business
 Who we are and what we say we do.
 Visible through business or company documents, goals, mission and official statements, often slogans and logos are developed to represent culture.

63
Q

define real (unofficial) corporate culture

A

actual values or beliefs present in a company, observable from dress, behaviour, way employees and managers relate to eachother.

64
Q

how to see real corporate culture

A

 What happens in a business
 Who we actually are and what we do.
 Obtained through observation of what occurs and the real relationships and interactions between people.

65
Q

indicators of positive corporate culture

A
  • Values and practices
  • Symbols
  • Heroes
  • Rituals, rites, celebrations
  • Physical environment, spaces to interact

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