small business management chapter 2 vocabulary
competencies
forms of business-related expertise
existence stage
the second stage of the business life cycle marked by the business being in operation but not yet stable in terms of markets, operations, or finances
business life cycle
the sequence or pattern of developmental stages any business goes through during its life span.
slack resources
profits that are available to be used to satisfy the preferences of the owner in how the business is run
determination competencies
skills identified with the energy and focus needed to bring a business into existence
specialized business professionalization
A situation that occurs when businesses have founders or owners who are passionate about one or two of the key business functions, such as sales, operations, accounting, finance, or human resources
cognition
a person's way of perceiving and thinking about his or her experience
key business functions
activities common to all businesses such as sales, operations (also called production), accounting, finance, and human resources.
industry-specific knowledge
activities, knowledge, and skills specific to businesses in a particular industry
succession
the process of intergenerational transfer of a business
standard business practice
a business action that has been widely adopted within an industry or occupation
certification
an examination-based acknowledgement that the firm is owned and operated as specified
role conflict
the kind of problem that arises when people have multiple responsibilities, such as parent and boss, and the different responsibilities make different demands on them
time management
the organizing process to help make the most efficient use of the day
resource maturity
the resource maturity stage is the most typical fourth stage of the small business. it is characterized by relatively stable or slow rising sales and profits over several years. in a firm that has a takeoff stage following the success stage, the resource maturity stage occurs after takeoff
action
the visible behavior a person takes
second career entrepreneurs
People who begin their businesses after having left, retired, or resigned from work. These can include veterans of the armed forces and civilians from a broad range of industries.
liability of newness
The set of risks faced by firms early in their life cycles that comes from a lack of knowledge by the owners about the business they are in and by customers about the new business.
family business
a firm in which one family owns a majority stake and is involved in the daily management of the business
organizational culture
a set of shared beliefs, basic assumptions, or common, accepted ways of dealing with problems and challenges within a company that demonstrate how things get done
expert business professionalization
a situation that occurs when all the major functions of a firm are conducted according to the standard business practices of its industry
emergence stage
the first stage of the small business life cycle, where the entrepreneur moves from thinking about starting the business to actually starting the business
passion
an intense positive feeling an entrepreneur has toward the business or the idea behind the business
minimalized business professionalization
a situation that occurs when the entrepreneur does nearly everything in the simplest way possible
opportunity competencies
skills necessary to identify and exploit elements of the business environment that can lead to a profitable and sustainable business
professionalization
the extent to which a firm meets or exceeds the standard business practices for its industry
comprehensive planners
entrepreneurs who develop long-range plans for all aspects of the business
Critical-point planners
entrepreneurs who develop plans focused on the most important aspect of the business first
habit-based planners
entrepreneurs who do not plan, preferring to let all actions be dictated by their routines
opportunistic planners
entrepreneurs who start with a goal instead of a plan and look for opportunities to achieve it
reactive planners
entrepreneurs with a passive approach, who wait for cues from the environment to determine what actions to take
promotion focus
an entrepreneur's attention to maximizing gains and pursuing opportunities likely to lead to gains
prevention focus
an entrepreneur's attention to minimizing losses, with a bias toward inaction or protective action to prevent loss.
resource competencies
the ability or skill of the entrepreneur at finding expendable components necessary to the operation of the business such as time, information, location, financing, raw materials, and expertise
perseverance
the ability to stick with some activity even when it takes a long time and its outcome is not immediately known
success stage
the third stage of the business life cycle marked by the firm being established in its market, operation, and finance
takeoff
this stage occurs after the success stage for a small percentage of businesses. it is characterized by rapid growth (5-10% a month or more). when this growth levels off, the firm enters the resource maturity stage