Lesson 3 Flashcards
(18 cards)
What are the three main types of entrepreneurial profit motives?
- Profit maximisation – making the highest possible profit.
- Profit satisficing – achieving a ‘good enough’ level of profit.
- Not-for-profit – using profits to support a specific cause.
Why should organisational values not be compromised?
Compromising values may harm business performance and reputation.
What are Key Performance Indicators (KPIs)?
Quantifiable measures of performance, expressed as numbers or percentages, used to assess business success.
How are KPIs used in a business?
They measure performance at different levels, from a single business process to the entire organisation.
What are corporate objectives?
Goals that help a business succeed by providing direction, coordinating operations, and measuring results.
What are the key functions of corporate objectives?
- Give a clear sense of direction
- Coordinate business operations
- Set functional objectives
- Delegate authority
- Measure performance
What are the main types of business objectives?
- Survival – ensuring business continues to operate.
- Profit satisficing – achieving an acceptable profit level.
- Profit maximisation – making the highest possible profit.
- Growth maximisation – increasing market share to strengthen against competitors.
- Diversification – expanding into new markets or offering new products/services.
How do different business types prioritise objectives?
- Sole traders focus on survival.
- Social enterprises prioritise profit satisficing.
- Public limited companies (PLCs) focus on growth and diversification.
What is Corporate Social Responsibility (CSR)?
A business strategy that creates social benefits while achieving profit and growth objectives.
What is the ‘triple bottom line’ in CSR?
- Profit – financial performance.
- People – considering shareholders and stakeholders.
- Planet – minimising environmental impact.
What is the goal of CSR?
To ensure businesses contribute to society and sustainability while maintaining profitability.
What does “doing well by doing good” mean in CSR?
Businesses can be profitable while supporting social and environmental causes.
How does CSR benefit businesses?
Improves reputation, attracts ethical consumers, and can lead to long-term financial success.
Why are environmental objectives important for businesses?
They help address global challenges like climate change, resource depletion, and pollution.
What are some environmental challenges businesses face?
- Increasing demand for resources and energy
- Deforestation and biodiversity loss
- Local and global pollution
- Climate change impacts
How can businesses promote sustainable production?
- Use renewable natural resources (e.g., water, fast-growing trees).
- Adopt renewable energy (e.g., solar, wind, wave power).
What is a circular economy?
A system focused on reducing waste by repairing, reusing, and recycling products.
How can businesses reduce food production’s environmental impact?
- Reduce food waste
- Operate locally to minimize fossil fuel use
