Intro to Business 100 Ch. 5,6,8,Bonus Chapter A

Franchisee

A person who buys a franchise

General Partnership

All owners share in operating the business and in assuming liability for the business's debts.

Centralized Authority

An organization structure in which decision making authority is maintained at the top level of management.

Line Organization

An organization with direct two way lines of communication running from the top to the bottom of the organization, people only report to one supervisor.

Common Law

Body of law that comes from decisions handed down by courts; also referred to as unwritten law.

Judiciary

Branch of Government chosen to oversee the legal system through a system of courts.

Franchise Agreement

Business sells the rights to use a Business's name and sell a product or service in a given territory.

Product Liability

Businesses are liable for the harm that stems from the production, design, or use of products they put to market.

Inverted Organization

Contact People at top, CEO at bottom

Intrapreneurs

Creative people who work as entrepreneurs within corporations.

Precedent

Decisions made in earlier cases that guide the handling of new cases.

Franchisor

Develops product concept and sells the rights to make and sell the products

Negotiable Instruments

Forms of commercial paper (such as checks) that are transferable among businesses and individuals and represent a promise to pay a specified amount.

Taxes

How the government raises money.

Venture Capitalists

Individuals or companies that invest in new businesses in exchange for partial ownership of those businesses.

Acquisition

One company's purchase of the property and obligations of another company

Limited Liability

Responsibility of a business's owners for losses only up to the amount they invest. Ex. Limited partners, Shareholders

Enterprise Zones

Specific areas governments try to attract businesses toward by offering lower taxes and other government support.

Formal Organization

Structure that details lines of responsibility, authority, and position, that is, the culture shown on organization charts.

Real Time

The actual moment, or time something takes place.

Departmentalization

The dividing up of organizational functions into separate units.

Core Competencies

The functions a firm can do as well as or better than any other organization in the rest of the world.

Damages

The monetary settlement awarded to a person who is injured by a breach of contract.

Span of Control

The optimal number of subordinates a manager supervises or should supervise.

Breach of Contract

When one party fails to follow the terms of a contact.

Matrix Organization

Where specialists from the organization are brought together to work on specific projects but still remain part of the line-and-staff structure.

Cooperative

A business owned and controlled by the people who use it-producers, consumers, or workers with similar needs who pool resources for mutual gain

Sole Proprietorship

A business that is owned, and usually managed by one person.

Limited Liability Company (LLC)

A company similar to an S corporation but without the special eligibility requirements.

Business Plan

A detailed written statement that describes the nature of the business, the target market, the advantages the business will have, and qualifications of the owners.

Copyright

A document that creates a creator's rights to materials such as books, articles, photos, paintings, and cartoons.

Entrepreneurial Team

A group of experienced people from different areas of business who join together to form a managerial team with the skills needed to develop, make, and market a new product.

Corporation

A legal entity with authority to act and have liability apart from its owners.

Partnership

A legal form of business with two or more owners

Contract

A legally enforceable agreement between two or more parties.

Limited Liability Partnership (LLP)

A partnership that limits partners' risk of losing their personal assets to only their own acts and omissions and to the acts and omissions of people under their supervision.

Master Limited Partnership (MLP)

A partnership that looks like a corporation and is traded on a stock exchange but is taxed like a partnership and avoids the corporate income tax.

Bankruptcy

A person, business, or entity, unable to meet financial obligations, is relieved of those obligations by a court that divides any assets among creditors, allowing creditors to get at least part of their money and freeing the debtor to begin anew.

Small Business Investment Company (SBIC)

A program which private investment companies licensed by the Small Business Administration lend money to small businesses.

Consumerism

A social movement that seeks to increase and strengthen the rights and powers of buyers in relation to sellers.

Conventional (C) Corporation

A state-chartered legal entity with authority to act and have liability separate from its owners.

Hierarchy

A system in which one person is at the top of the organization and there is a ranked or sequential ordering from the top down of managers who are responsible to that person.

Virtual Corporation

A temporary networked organization made up of replaceable firms that join and leave as needed.

Organization Chart

A visual device that shows relationships among people and divides the organization's work: it shows who reports whom

Tort

A wrongful act that causes injury to another person's body, property, or reputation.

Entrepreneurship

Accepting the risk of starting and running a business.

Affiliate Marketing

Affiliates are rewarded for sending customers to their website.

Leveraged Buyout (LBO)

An attempt by employees , management, or investors to purchase an organization through borrowing.

Bureaucracy

An organization with many layers of managers who set rules and regulations and oversee all decisions.

Limited Partner

An owner who invests money in the business but does not have any management responsibility or liability for losses beyond investment

General Partner

An owner/partner who has unlimited liability and is active in managing the firm.

Involuntary Bankruptcy

Bankruptcy procedures filed by a debtor's creditors

Incubators

Centers that offer new businesses low-cost offices with basic business services.

Economies of Scale

Companies can reduce their production costs if they can purchase raw materials in bulk; average cost of goods goes down as production increases.

Benchmarking

Comparing one business's achievements and stats against the world's best.

Uniform Commercial Code (UCC)

Comprehensive commercial law that covers sales law and other commercial laws.

Line Personnel

Employees part of the chain of command responsible for accomplishing company goals.

Micropreneurs

Entrepreneurs willing to accept the risk of starting and managing the type of business that remains small, lets them do the kind of work they want, with a balanced lifestyle.

Administrative Agencies

Fed or state institutions and other government organizations created by Congress or state legislatures with delegated power to create rules and regulations within their mandated area of authority.

Flat Organization Structure

Few layers of management and a broad span of control

Patent

Gives inventor's exclusive rights to their inventions for 20 years. (7 if pharmaceutical)

Small Business Administration (SBA)

Gov. organization that provides management training, financial advice, and loans.

S Corporation

Government creation that looks like a corporation but is taxed like partnerships and sole proprietors.

Deregulation

Government withdrawal of certain laws and regulations that seem to hinder competition.

Cross-Functional Self Managed Teams

Groups of employees from different departments who work together on a long term basis.

Implied Warranties

Guarantees concerning products legally imposed on the seller.

Negligence

In tort law, behavior that causes unintentional harm or injury.

Small Business

Independently owned, not dominant in it's field of service, and meets certain standards set by the BBB as far as employees and annual receipts.

Voluntary Bankruptcy

Legal procedures initiated by a debtor

Strict Product Liability

Legal responsibility for harm or injury caused by a product regardless of fault.

Decentralized Authority

Organizational structure in which decision making authority is delegated to lower level managers more familiar with local conditions than headquarters management should be.

Limited Partnership

Partnership with one or more general partners and one or more limited partners.

Staff Personnel

People who advise and assist line personnel in achieving their goals.

Market

People with unsatisfied wants and needs who have the resources and willingness to buy.

Tall Organization Structure

Pyramidal organization chart would be tall because of the many levels of management

Restructuring

Redesigning an organization so it may more effectively serve its customers

Service Corps of Retired Executives (SCORE)

Retired veterans of the business industry provide advice for small businesses for no cost. (except expenses)

Contract Law

Set of laws that specify what constitutes a legally enforceable agreement.

Consideration

Something of value; consideration is one of the requirements of a legal contract.

Express Warranties

Specific representations by the seller that buyers rely on regarding the goods they purchase.

Statutory Law

State and federal constitutions, legislative enactments, treaties....written law

Informal Organization

System develops spontaneously as employees meet and form cliques, relationships, and lines of authority outside the formal organization.

Conglomerate Merger

The joining of firms in completely unrelated industries

Vertical Merger

The joining of two companies involved in different stages of related business

Horizontal Merger

The joining of two firms in the same industry

Chain of Command

The line of authority that moves from the top of a hierarchy to the lowest level.

Unlimited Liability

The responsibility of business owners for all the debts of the business

Merger

The result of two firms forming one company

Franchise

The right to use a specific business's name and sell its products or services in a given territory.

Business Law

The rules, statutes, codes, and regulations that provide a legal framework for the conduct of business and that are enforceable by court action.

Networking

Using communications and technology to link organizations together to work on common objectives.

Organizational (or corporate) Culture

Widely shared values within an organization that provide unity and cooperation to accomplish common goals.

Digital Natives

Young people who have grown up using the internet and social media.