Business CH. 1

What is the primary objective of a not-for-profit organization

Not-for-profit organizations place public service above profits, although they need to raise money in order to operate and achieve their social goals.

Define outsourcing, offshoring, and nearshoring.

Outsourcing involves using outside vendors to produce goods or fulfill services and functions that were once handled in house. Offshoring is the relocation of business processes to lower-cost locations overseas. Nearshoring is the outsourcing of production or services to locations near a company's home base.

Outline the characteristics that make a company admired.

A company is usually admired for its solid profits, stable growth, a safe and challenging work environment, high-quality goods and services, and business ethics and social responsibility.

What is an entrepreneur

An entrepreneur is a risk taker who is willing to start, own, and operate a business.

What activity lies at the center of every business endeavor?

At the heart of every business endeavor is an exchange between a buyer and a seller.

Define business

Business consists of all profit-seeking activities that provide goods and services necessary to an economic system. Not-for-profit organizations are business-like establishments whose primary objective is public service over profits

What was the Industrial Revolution

The Industrial Revolution began around 1750 in England and moved business operations from an emphasis on independent, skilled workers to a factory system that mass-produced items.

Identify and describe the factors of production.

The factors of production consist of four basic inputs: land, labor, capital, and entrepreneurship. Land is used in the production of a good, and includes all production inputs or natural resources that are useful in their natural states such as oil, gas, minerals, and timber. Labor includes anyone who works for a company. Capital includes technology, tools, information, and physical facilities. Entrepreneurship is the willingness to take risks to create and operate a business.

Identify the four basic inputs to an economic system

The four basic inputs are land, labor, capital, and entrepreneurship.

During which era was the idea of branding developed

The idea of branding began in the marketing era.

What is the most basic freedom under the private enterprise system?

The most basic freedom is the right to private property.

Describe the private enterprise system.

The private enterprise system is an economic system that rewards companies for their ability to perceive and serve the needs and demands of consumers. Competition in the private enterprise system ensures success for companies that satisfy consumer demands. Citizens in a private enterprise economy enjoy the rights to private property, profits, freedom of choice, and competition. Entrepreneurship drives economic growth.

Identify the seven eras in the history of business.

The seven historical eras are the Colonial period, the Industrial Revolution, the age of industrial entrepreneurs, the production era, the marketing era, the relationship era, and the social era. In the Colonial period, businesses were small and rural, emphasizing agricultural production. The Industrial Revolution brought factories and mass production to business. The age of industrial entrepreneurs built on the Industrial Revolution through an expansion in the number and size of companies. The production era focused on the growth of factory operations through assembly lines and other efficient internal processes. During and following the Great Depression, businesses concentrated on finding markets for their products through advertising and selling, giving rise to the marketing era. In the relationship era, businesspeople focused on developing and sustaining long-term relationships with customers and other businesses. In the social era, businesses use technology and relationship management to connect and communicate with consumers and promote innovation. Strategic alliances create a competitive advantage through partnerships. Concern for the environment also helps build strong relationships with customers

Explain current workforce trends in business.

The workforce is changing in several significant ways: it is aging and the labor pool is shrinking, and it is becoming increasingly diverse. The nature of work has shifted toward services and a focus on information. More businesses now rely on outsourcing, offshoring, and nearshoring to produce goods or fulfill services and functions that were previously handled in-house or in-country. In addition, today's workplaces are becoming increasingly flexible, allowing employees to work from different locations. And with artificial intelligence (AI) to become more efficient, companies are fostering innovation through teamwork and collaboration.

Why is vision an important managerial quality

To thrive in the 21st century, managers need vision, the ability to perceive marketplace needs and to determine what an organization must do to satisfy those needs.

brand

a name, term, sign, symbol, or design, or a combination of these, that identifies the products or services of one seller or group of sellers and differentiates them from those of competitors

critical thinking

ability to analyze and assess information to pinpoint problems or opportunities

vision

ability to perceive marketplace needs and what an organization must do to satisfy them.

competition

battle among businesses for consumer acceptance.

diversity

blending individuals of different genders, ethnic backgrounds, cultures, religions, ages , and physical and mental abilities to enhance a company's chances of success.

transaction management

building and promoting products in the hope that enough customers will buy them to cover costs and earn profits

Relationship Era

business era in which companies seek ways to actively nurture customer loyalty by carefully managing every interaction.

Social Era

business era in which firms seek ways to connect and interact with customers using technology

consumer orientation

business philosophy that focuses first on determining unmet consumer wants and needs and then designing products to satisfy those needs

creativity

capacity to develop novel solutions to perceived organizational problems

relationship management

collection of activities that build and maintain ongoing, mutually beneficial ties with customers and other parties

capitalism

economic system that rewards companies for their ability to perceive and serve the needs and demands of consumers; also called the private enterprise system

Crowdsourcing

enlisting the collective talent of a number of people to get work done.

factors of production

four basic inputs for effective operation: land, labor, capital, and entrepreneurship.

labor

includes anyone who works, from the chief executive officer (CEO) of a huge corporation to a self-employed writer or editor. This category encompasses both the physical labor and the intellectual inputs contributed by workers

Capital

includes technology, tools, information, and physical facilities.

private property

most basic freedom under the private enterprise system; the right to own, use, buy, sell, and bequeath land, buildings, machinery, equipment, patents, individual possessions, and various intangible kinds of property

not-for-profit organizations

organizations that have primary objectives such as public service rather than returning a profit to its owners

Nearshoring

outsourcing production or services to locations near a company's home base or closer to customers

strategic alliance

partnership formed to create a competitive advantage for the businesses involved; in international business, a business strategy in which a company finds a partner in the country where it wants to do business.

Branding

process of creating in the consumer's mind a clear identity for a particular company's product, logo, or trademark

Offshoring

relocation of business processes to lower-cost locations overseas.

profits

rewards earned by businesspeople who take the risks involved in blending people, technology, and information to create and market want-satisfying goods and services.

Entrepreneurship

the willingness to take risks to create and operate a business

competitive differentiation

unique combination of organizational abilities, products, and approaches that sets a company apart from competitors in the minds of customers

Land

used in the production of a good, includes all production inputs or natural resources that are useful in their natural states such as oil, gas, minerals, and timber

Outsourcing

using outside vendors—contracting work out to another party—for the production of goods or fulfillment of services and functions previously performed in house

Define business ethics and social responsibility

Business ethics refers to the standards of conduct and moral values involving decisions made in the work environment. Social responsibility is a management philosophy that includes contributing resources to the community, preserving the natural environment, and developing or participating in nonprofit programs designed to promote the well-being of the general public.

Describe the importance of collaboration and employee partnership

Businesses are increasingly focusing on collaboration rather than on individuals working alone. No longer do employees just put in their time at a job they hold their entire career. The new employer-employee partnership encourages teamwork, creative thinking, and problem solving.

What is an alternative term for private enterprise system?

Capitalism

Identify three criteria used to judge whether a company might be considered admirable

Criteria in judging whether companies are admirable include three of the following: solid profits, consistent growth, a safe and challenging work environment, high-quality goods and services, and business ethics and social responsibility.

What is the difference between creativity and critical thinking

Critical thinking is the ability to analyze and assess information to pinpoint problems or opportunities. Creativity is the capacity to develop novel solutions to perceived organizational problems.

Identify the skills and attributes needed for today's manager.

For today's managers, the ability to communicate and strategically apply critical thinking skills and creativity to both challenges and opportunities will be a top priority. Critical-thinking skills and creativity allow managers to pinpoint problems and opportunities and plan novel solutions. Finally, managers are dealing with rapid change, and they need skills to help lead their organizations through shifts in external and internal conditions.

What is the difference between transaction management and management in the relationship era

Transaction management is an approach that focuses on building, promoting, and selling enough products to cover costs and earn profits. In the relationship era, businesses seek ways to actively nurture customer loyalty by carefully managing every interaction.