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

Unit 1 - Business Organisation Flashcards

(84 cards)

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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

deregulation

A

removal of government rules and regulations which constrain an industry

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15
Q

differentiation

A

firm makes its products distinct from those of its competitors, e.g. by packaging, by branding

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16
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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17
Q

diversification

A

growth strategy that involves selling new products in new markets

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18
Q

economic growth

A

increase in the GDP of a country

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19
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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20
Q

ethics

A

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

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21
Q

entrepreneurs

A

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

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22
Q

exchange rate

A

value of a currency in terms of another currency

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23
Q

external growth

A

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

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24
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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25
factors of production
inputs necessary for the production process (land, labour, capital, entrepreneurship)
26
forward vertical integration
business buys a firm operating in a later stage of production, e.g. firm buys costumer
27
franchise
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
28
free trade
trade without trade barriers
29
globalization
integration and interdependence of economic, social, technical and cultural issues of the world’s economies
30
Gross Domestic Product (GDP)
total value of all goods and services produced in an economy in one year
31
horizontal integration
business buys a firm operating in the same stage of production, e.g. firm buys competitor
32
inflation
steady increase in the price level
33
interest rate
price of borrowed money
34
internal growth
business grows by using its own resources to increase the scale of its operations and sales revenue
35
internal stakeholders
are members of the organisation, e.g. employees, shareholders, managers
36
joint venture
two or more different organisations share costs, risks, control and rewards and form a separate legal enterprise, e.g. Sony-Ericsson
37
labour
physical and mental effort
38
land
all natural resources, e.g. land itself, water, wood
39
limited liability
restriction on the amount of money the owners of a company can lose if the business goes into bankruptcy
40
market development
growth strategy that involves selling existing products in new markets
41
market penetration
growth strategy that involves selling more existing products in existing markets
42
merger
form of external growth whereby two or more firms agree to form a new organisation
43
mission statement
declaration of an organisation’s overall purpose
44
multinational corporations (MNCs)
companies that operate production or service facilities outside their home country
45
non-governmental organisations (NGOs)
private sector organisations that operate for the benefit of others rather than aiming to make a profit, e.g. Oxfam, Amnesty International
46
objectives
short-term targets of an organisation
47
partnerships
form of business owned by 2 – 20 people with shared responsibilities and burdens of running and owning the business
48
PEST analysis
decision-making framework used to analyse the opportunities and threats of the political, economic, social and technological environment
49
pressure groups
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
50
primary sector
cultivation or extraction of natural resources, e.g. farming, mining, fishing, forestry
51
private limited company
business owned by shareholders with limited liability but whose shares cannot be bought by or sold to the general public
52
private sector
part of the economy under the control of private individuals or businesses
53
protectionism
any measure taken by a government to protect the domestic industry from foreign competition
54
public limited company
business owned by shareholders with limited liability whose shares can be bought by or sold to the general public via a stock exchange
55
public sector
part of the economy under the control of the government
56
secondary sector
construction and manufacturing of products
57
shareholders
owners of a company
58
SMART objectives
objectives that are specific, measurable, achievable, realistic and time-specific
59
sole trader
self-employed person who runs the business on their own and has sole responsibility for its success or failure
60
stakeholders
individuals or organisations that have direct interest in the activities and performance of a business
61
stock exchange
market place for trading stocks and shares of public limited companies, e.g. LSE, NYSE
62
strategic alliance
two or more different organisations share costs, risks, control and rewards, but don’t form a separate legal enterprise, e.g. Star Alliance
63
strategy
medium- to long-term methods that businesses can use to achieve its goals
64
SWOT analysis
analytical tool used to assess internal strengths and weaknesses and external opportunities and threats
65
tactics
short-term methods that businesses can use to achieve their objectives
66
takeover or acquisition
form of external growth whereby on firm buys up another by purchasing enough shares to hold a majority
67
tertiary sector
provision of services
68
unemployment
number of people in a country who are willing and able to work but cannot find a job
69
unlimited liability
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
70
vision statement
organisation’s long-term aspirations, i.e. where it ultimately wants to be
71
consumers
people or organizations who actually use a product
72
cooperative
for-profit social enterprise set up, owned and run by their members
73
customers
people or organizations who buy a product
74
ethical code of practice
documented beliefs and philosophies of an organization
75
initial public offering
(IPO) occurs when a business sells all or part of its business to shareholders on a stock exchange for the first time
76
microfinance
type of financial service aimed at entrepreneurs of small very businesses
77
needs
basic necessities that a person must have to survive
78
optimal level of output
most efficient sale of operation for a business which occurs at the level of output where average costs of production are minimized
79
product
refers to both goods and services: goods are physical products, services are intangible products
80
public-private partnership
government creates commercial partnerships with the private sector to provide certain goods or services
81
social enterprise
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
82
STEEPLE analysis
analytical framework used to analyse the opportunities and threats of the external environment (social, technological, economic, environmental, political, legal and ethical environments)
83
structural change
shift of the relative share of national output and employment that is attributed to each business sector
84
want
people’s desires

IB Business Management SL 2016+ (5 decks)

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