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IB Business Management HL 2016+ > Unit 1 - Business Organisation > Flashcards

Unit 1 - Business Organisation Flashcards

1
Q

added value

A

difference between a product’s price and the total cost of the inputs that went into making it; extra worth created in the production process

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2
Q

aim

A

long-term goals of a business, often expressed in the firm’s mission statement

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3
Q

Ansoff’s matrix

A

tool to analyse product and market growth strategies

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4
Q

backward vertical integration

A

business buys a firm operating in an earlier stage of production, e.g. firm buys supplier

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5
Q

business

A

organisation involved in the production of goods and/or provision of services

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6
Q

business cycle

A

cyclical fluctuations in economic activity; the business cycle shows that economies typically move through a pattern of economic growth with the phases: recovery, boom, recession, trough

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7
Q

business plan

A

report detailing how a business sets out to achieve its aims and objectives

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8
Q

capital

A

all non-natural resources used in the production process, e.g. money, machines, buildings

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9
Q

charities

A

non-profit organisations established to support good causes

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10
Q

company

A

business that is owned by shareholders with a separate legal identity from its owners

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11
Q

conflict

A

situation where people have disagreements or certain matters due to differences in their opinions

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12
Q

conglomerates

A

businesses with a diversified range of products and operations in different industries, e.g. Virgin

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13
Q

corporate social responsibility CSR

A

consideration of ethical and environmental issues relating to business activity

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14
Q

decision-making framework

A

systematic process of dealing with business problems, concerns or issues in order to make the best decision

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15
Q

decision trees HL

A

tool to calculate the probable values of different options

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16
Q

deregulation

A

removal of government rules and regulations which constrain an industry

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17
Q

diseconomies of scale

A

cost disadvantages of growth as unit costs eventually rise as a firm grows, e.g. lack of control

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18
Q

diversification

A

growth strategy that involves selling new products in new markets

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19
Q

division of labour

A

breaking a job down into particular roles or tasks that are repeated by the same workers

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20
Q

driving forces HL

A

forces acting for change, e.g. benefits after the change

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21
Q

economic growth

A

increase in the GDP of a country

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22
Q

economies of scale

A

cost advantages of growth as unit costs eventually decrease as a firm grows, e.g. bulk buying

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23
Q

ethics

A

moral values that determine and affect business behaviour and decision-making

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24
Q

entrepreneurs

A

people who organise the other 3 factors or production and take the risk

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25
Q

exchange rate

A

value of a currency in terms of another currency

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26
Q

external growth

A

business grows by collaborating, buying up or merging with another firm

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27
Q

external stakeholders

A

are not part of the organisation but have direct interest in its actions, e.g. customers, suppliers, government

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28
Q

factors of production

A

inputs necessary for the production process (land, labour, capital, entrepreneurship)

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29
Q

fishbone diagram HL

A

decision-making framework based on identifying the root causes of a problem or issue

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30
Q

force-field analysis HL

A

model that deals with the forces for and against change

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31
Q

forward vertical integration

A

business buys a firm operating in a later stage of production, e.g. firm buys costumer

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32
Q

franchise

A

agreement between a franchisor selling its rights to other businesses to allow them to sell products under its name in return for a fee, e.g. McDonald’s, Subway, Benetton

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33
Q

free trade

A

trade without trade barriers

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34
Q

globalization

A

integration and interdependence of economic, social, technical and cultural issues of the world’s economies

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35
Q

Gross Domestic Product (GDP)

A

total value of all goods and services produced in an economy in one year

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36
Q

horizontal integration

A

business buys a firm operating in the same stage of production, e.g. firm buys competitor

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37
Q

inflation

A

steady increase in the price level

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38
Q

interest rate

A

price of borrowed money

39
Q

internal growth

A

business grows by using its own resources to increase the scale of its operations and sales revenue

40
Q

internal stakeholders

A

are members of the organisation, e.g. employees, shareholders, managers

41
Q

joint venture

A

two or more different organisations share costs, risks, control and rewards and form a separate legal enterprise, e.g. Sony-Ericsson

42
Q

labour

A

physical and mental effort

43
Q

land

A

all natural resources, e.g. land itself, water, wood

44
Q

limited liability

A

restriction on the amount of money the owners of a company can lose if the business goes into bankruptcy

45
Q

market development

A

growth strategy that involves selling existing products in new markets

46
Q

market penetration

A

growth strategy that involves selling more existing products in existing markets

47
Q

merger

A

form of external growth whereby two or more firms agree to form a new organisation

48
Q

mission statement

A

declaration of an organisation’s overall purpose

49
Q

multinational corporations (MNCs)

A

companies that operate production or service facilities outside their home country

50
Q

non-governmental organisations (NGOs)

A

private sector organisations that operate for the benefit of others rather than aiming to make a profit, e.g. Oxfam, Amnesty International

51
Q

objectives

A

short-term targets of an organisation

52
Q

partnerships

A

form of business owned by 2 – 20 people with shared responsibilities and burdens of running and owning the business

53
Q

PEST analysis

A

decision-making framework used to analyse the opportunities and threats of the political, economic, social and technological environment

54
Q

pressure groups

A

individuals with a common concern who seek to place demands on organisations to act in a particular way or to influence a change in their behaviour

55
Q

primary sector

A

cultivation or extraction of natural resources, e.g. farming, mining, fishing, forestry

56
Q

private limited company

A

business owned by shareholders with limited liability but whose shares cannot be bought by or sold to the general public

57
Q

private sector

A

part of the economy under the control of private individuals or businesses

58
Q

product development

A

growth strategy that involves selling new products in existing markets

59
Q

protectionism

A

any measure taken by a government to protect the domestic industry from foreign competition

60
Q

public corporations

A

organisations wholly owned by the government

61
Q

public limited company

A

business owned by shareholders with limited liability whose shares can be bought by or sold to the general public via a stock exchange

62
Q

public-private partnership

A

government creates commercial partnerships with the private sector to provide certain goods or services

63
Q

public sector

A

part of the economy under the control of the government

64
Q

restraining forces HL

A

forces acting against change, e.g. disadvantages after the change

65
Q

secondary sector

A

construction and manufacturing of products

66
Q

shareholders

A

owners of a company

67
Q

SMART objectives

A

objectives that are specific, measurable, achievable, realistic and time-specific

68
Q

sole trader

A

self-employed person who runs the business on their own and has sole responsibility for its success or failure

69
Q

stakeholders

A

individuals or organisations that have direct interest in the activities and performance of a business

70
Q

stock exchange

A

market place for trading stocks and shares of public limited companies, e.g. LSE, NYSE

71
Q

strategic alliance

A

two or more different organisations share costs, risks, control and rewards, but don’t form a separate legal enterprise, e.g. Star Alliance

72
Q

strategy

A

medium- to long-term methods that businesses can use to achieve its goals

73
Q

structural change

A

shift of the relative share of national output and employment that is attributed to each business sector

74
Q

SWOT analysis

A

analytical tool used to assess internal strengths and weaknesses and external opportunities and threats

75
Q

tactics

A

short-term methods that businesses can use to achieve their objectives

76
Q

takeover or acquisition

A

form of external growth whereby on firm buys up another by purchasing enough shares to hold a majority

77
Q

tertiary sector

A

provision of services

78
Q

unemployment

A

number of people in a country who are willing and able to work but cannot find a job

79
Q

unlimited liability

A

feature of sole traders and partners who are legally liable for all money owed to their creditors, even if it means that they have to sell their personal possessions to pay for this

80
Q

vision statement

A

organisation’s long-term aspirations, i.e. where it ultimately wants to be

81
Q

consumers

A

people or organizations who actually use a product

82
Q

cooperative

A

for-profit social enterprise set up, owned and run by their members

83
Q

customers

A

people or organizations who buy a product

84
Q

ethical code of practice

A

documented beliefs and philosophies of an organization

85
Q

GANTT chart HL

A

visual representation of all the tasks in a particular project plotted against the timescale

86
Q

initial public offering

A

(IPO) occurs when a business sells all or part of its business to shareholders on a stock exchange for the first time

87
Q

microfinance

A

type of financial service aimed at entrepreneurs of small very businesses

88
Q

needs

A

basic necessities that a person must have to survive

89
Q

optimal level of output

A

most efficient sale of operation for a business which occurs at the level of output where average costs of production are minimized

90
Q

organizational planning tools HL

A

methods that businesses use to aid their decision-making, e.g. decision trees, GANTT charts

91
Q

product

A

refers to both goods and services: goods are physical products, services are intangible products

92
Q

social enterprise

A

revenue-generating business with social objectives at the core of their operations and can be for-profit and non-profit, but all surpluses are reinvested for the social purpose

93
Q

STEEPLE analysis

A

analytical framework used to analyse the opportunities and threats of the external environment (social, technological, economic, environmental, political, legal and ethical environments)

94
Q

want

A

people’s desires

IB Business Management HL 2016+ (5 decks)

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