BMGT 110 - Exam 1, Jeff Miller

Advantages/Disadvantages of Entrepreneurship

Advantages: freedom to make own decisions, more opportunity and wealth Disadvantages: more risk and lose benefits from other employers

2 Major Competitors

China and India

Logistics vs. Distribution

Distribution means transportation. Logistics is more complex. (multiple different types of logistics)

Manager vs. Leader

Managers plan, organize, control functions. Leaders have a vision and inspire others, establish values, emphasize ethics.

Service Corps of Retired Executives

SBA volunteers from industry, trade associates, education who counsel small businesses at no cost

Two Different Types of Warehouses

Storage warehouses store products for a relatively long time. Distribution warehouses are used to gather/redistribute products.

Mass Customization

Tailoring products to meet needs of individual customers

Technical Skills

ability to perform tasks in specific part of department

Master Limited Partnership

acts like corporation, traded on stock exchange, taxed like partnership, avoids corporate tax

Service Utility

adding value by providing fast, friendly service during and after the sale and by teaching customers how to best use products over time

Place Utility

adding value to products by having them where people want them

Time Utility

adding value to products by making them available when they're needed

Information Utility

adding value to products by opening two-way flows of information between marketing participants

Channels of Distribution

agents, brokers, wholesalers, retaliers

Communism

all economic decisions made by government, control factors of production

Corporate Distribution System

all organizations the channel of distribution are owned by one firm

Productivity

amount of output generated with given imput

Direct Marketing

any activity that directly link manufacturers or intermediaries with the customer

Leverage Buyout

attempt by employees, management, or group of investors to purchase an organization primarily through borrowing

Corportation

authority to act and have ability apart from owners

Gantt Chart

bar graph showing production managers what projects are being worked on and what stage they are at a given time

Strategical Planning

broad, long-term planning that outlines goals of organization

Cooperative

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

Sole Proprietorship

business owned and managed by one person

Unlimited Liability

business owners are responsible for all debts of business (may have to sell personal possessions to pay business debts)

Partnership

business with two or more owners

Incubators

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

Four Choices in Structuring Orgainzations

centralize or decentralize, breadth of span of control, tall versus flat organization structures and type of departmentalization

Enterprise Resource Planning (EPR)

combines computerized functions of all divisions and subsidiaries of the firm into a single integrated software program that uses a singe database

Economies Of Scale

companies reduce production costs if they can purchase raw materials in bulk

Venture Capitalists

companies that invest in new businesses in exchange in partial ownership of those businesses

Franchisor

company that develops a product concept and sells others the right to make and sell the products

Transparency

company's facts and figures clear to all stakeholders

Materials Requirement Planning (MRP)

computer based operations management system that uses sales forecasts to make sure that needed parts/materials are available at right time/place

Participative Leadership

consists of managers and employees working together to make decisions

Statistical Quality Control (SQC)

continually monitor all phases of production process to assure quality is being built into product from beginning

Operations Managament

converts resources into goods and services

Four Types of Distribution Systems

corporate systems, contractual systems, administered systems, and supply chains

S Corporation

corporation with limited liability and simpler taxes, company must have fewer than 100 stockholders, cannot derive more than 25% of income from passive sources

Intrapreneurs

creative people who work as entrepreneurs within corporations

Stakeholders

customers, employees, stockholders, suppliers, dealers, bankers, media, people in community, environmentalists, government leaders. Businesses must respond to needs of them and still make profit.

Decentralized Authority

decision making authority is delegated to lower level managers more familiar with local conditions than headquarters

Centralized Authority

decision making authority is maintained at top level of managment

Steps of Decision Making

define a situation, describe collected information, develop alternatives, develop agreement, decide which alternative is best, do what is indicated, determine whether decision is a good on

Flexible Manufacturing

designing machines to do multiple tasks so they can produce a variety of products

Tactical Planning

detailed, short-term statements about what is to be done, who is to do it, and how it is to be done

Line Organization

direct two-way lines of responsibility, all people reporting to one supervisor, provides each worker with only one supervisor

Contractual Distribution System

distribution system in which members are bound to coorperate through contractual agreements

Intense Distribution

distribution that puts products into as many retail outlets as possible

Selective Distribution

distribution that sends products to only a preferred group of retailers in an area

Exclusive Distribution

distribution that sends products to only one retailer outlet in a given geographic area

Possession Utility

doing what is necessary to transfer ownership from one party to another (delivery, installation, guarantees)

Stagflation

economy is slowing but prices going up

Line Personnel

employees part of a chain of command responsible for achieving organizational goals

Staff Personnel

employees who advise and assist line personnel in meeting their goals

Micropreneur

entrepreneurs willing to risk starting a small business, lets them do work they want to do, and offers a balanced lifestyle

Line-And-Staff Organizations

expert advice of staff assistants help in areas such as safety, quality control, computer technology, human resource managament, and investing

Capitalism

factors of production and distribution are privately owned, operated for profit

Flat Organization Structure

few layers of management and a broad span of control

Oligopoly

few sellers dominate market

Core Competencies

functions that organizations can do better than any organization in the world

Command Economies

government decides what goods/services are produced, who gets them, and how economy will grow

Fiscal Policy

govt's efforts to keep economy stable by increasing/decreasing taxes or govt spending

Cross Functional Self-Managed Teams

groups of employees from different departments who work together on a long-term basis

How businesses beat competiton

high-quality products, exceed customer expectations, more training and authority of employees (empowerment)

Merchant Wholesalers

independently owned firms that take title to the goods they handle

Producer Price Index (PPI)

index that measures prices at wholesale level

Affiliate Marketing

internet-based marketing strategy, business rewards businesses for each customer they send to the website

Conceptual Skills

involve the ability to picture the organization as a whole and relationship of various parts

Reverse Logistics

involves bringing goods back to manufacturer because of defects or for recycling materials

Inbound Logistics

involves bringing raw materials, packaging, other goods and services, and information from suppliers to producers

Outbound Logistics

involves managing flow of finished products and information to business buyers and ultimate consumers

Conglomerate Merger

joining firms of unrelated industries (Ex. Athletic Shoes and Soda Firm OR Soda Company and Snack Food Company)

Vertical Merger

joining two companies involved in different stages of related businesses. (Ex. automobile company joining with a parts supplier OR Soda Company and Artificial Sweetener Company)

Horizontal Merger

joining two firms in same industry (Ex. Pepsi and Coke OR Soda Company and Mineral Water Company)

Five Factors of Production

land, labor, capital, entrepreneurship, and knowledge.

Monopolistic Competition

large number of sellers produce similar goods that buyers perceive as different

Limited Liability Partnership

limits partners' risks of losing personal assets to only their own acts

Formal Organization

lines of responsibility, authority, and position; structure shown on org. charts

Supply Chain

linked activities that are preformed by various organizations to move goods from the source of raw materials to customers

Continuous Process

long production runs turn out finished good over time

Autocratic Leadership

making managerial decisions without consulting others

Monetary Policy

management of money supply and interest rates by Federal Reserve

Free-Rein Leadership

managers setting objectives and employees being relatively free to do whatever it takes to accomplish objectives

Free-Market Economies

market determines what goods/services produced, who gets them, and how economy will grow

Agents/Brokers

marketing intermediaries who bring buyers and sellers together and assist negotiating an exchange but don't take title to the goods

Wholesaler

marketing intermediary that sells to other organizations and individuals, but not to final consumer

Program Evaluation and Review Technique (PERT)

method for analyzing the tasks involved in completing a given project, estimating time needed to complete each task, and identify minimum time to complete total project

Consumer Price Index (CPI)

monthly statistics that measures inflation and deflation

Materials Handling

movement of goods within a warehouse, from warehouse to factory floor, from there to workstations

Acquisition

one company purchases another

Monopoly

one seller controls total supply of product/service, sets price

Span of Control

optimal number of subordinates a manager supervises

Inverted Organization

organization that has contract people at the top and chief executive at the bottom of org. chart

Freight Forwarder

organization that puts many small shipments together to create single large shipment that can be transported cost-effectively to the final destination

Retailer

organization that sells to customers

Bureaucracy

organization with many layers of managers who set rules and regulations and oversee all decisons

Process Manufacturing

part of production process that physically/chemically changes materials

Assembly Process

part of production that puts together components

General Partnership

partnership where owners share operating cost and the liability of business's debts

Limited Partnership

partnership with one of more general partners and one of more limited partners

Franchisee

person who buys a franchise

Facility Layout

physical arrangement of resources in production process

Logistics

planning, implementing, and controlling the physical flow of materials, final goods, and related information

Four Functions of Managment

planning, organizing, leading, and controlling

Disinflation

price increases slowly (inflation rate declining)

Deflation

prices declining

Supply-Chain Management

process of managing movement of raw materials, parts, work in progress, finished goods, and related information though organizations

Contingency Planning

process of preparing alternative courses if primary plans don't achieve objectives

Administered Distribution System

producers manage all marketing functions at retail level

Efficiency

producing items from least amount of resources

Lean Manufacturing

production of good using less of everything compared to mass production

Just-In-Time (JIT) Inventory Control

production process, minimum of inventory is kept on premises and parts, supplies, other needs are delivered just in time to go on assembly line

Intermittent Process

production run is short and the machines are changed frequently to make different products

Businesses' profit to risk assumption relationship

profit is the money earned with salaries and other expenses deducted. Risk is chance entrepreneurs take of losing time/money.

Tall Organization Structure

pyramidal organization chart would be tall because of various levels of management

Transportation Modes

rail, trucks, ships, pipelines, and airplanes

Restructuring

redesigning an organization so that it can be more effective to serve customer

Merger

result of two firms forming one company

Basic Rights Under Capitalism

right to private property, right to own business and keep profits after taxes, freedom of competition, freedom of choice

Franchise

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

Inflation

rise in prices over time

Telemarketing

sales of goods and services by telephone

Electronic Retailing

selling goods and services to ultimate customers over the internet

Direct Selling

selling to consumers in their homes or where they work

Operational Planning

setting work standards and schedules necessary to implement company's tactical objective

Depression

severe recession with deflation

Objectives

short-term statements detailing how to achieve the organization's goals

Mixed Economies

some resources made by market, some made by individuals

Franchise Agreement

someone with a good business sells rights to use business name and sell a product/service to others

Matrix Organization

specialists from different parts of the organization are brought together to work on specific projects for a short-term, still remain part of line and staff structure

Enterprise Zones

specific areas governments try to attract business investment by offering lower taxes and other support

Limited Liability

stockholders and limited partners are responsible for losses up to amount they invested (private property not at risk)

SWOT analysis

strengths, weaknesses, opportunities, and threats

Economics

study of how society produces goods and services and distributes them amoung competing groups

Resource Development

study of how to increase resources and create conditions to make better use of resources

Microeconomics

study that looks at behavior of people and organizations in a market

Macroeconomics

study that looks at nations economy as a whole

Informal Organization

system that develops spontaneously as employees meet and form cliques, relationships, and line of authority outside the formal organization

Virtual Corportation

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

Keynesian Economic Theory

theory that a govt policy of increasing spending and cutting taxes could stimulate economy in recession

GDP

total value of good/services produced in a country in a given year

Channel of Distribution

transport and store goods in their path from producer to consumer

Recession

two or more consecutive quarters of decline in GDP

Computer-Integrated Manufacturing

uniting of computer aided design with computer aided manufacturing

Computer-Aided Manufacturing

use of computers in manufacturing of products

Computer Aided Design

use of computers in product design

Intermodal Shipping

use of multiple models of transportation to complete single long-distance movement of freight

Form Utility

value producers add to materials in creation of finished goods and services

Utility

value the organizations add to goods or services

Organization Chart

visual that shows relationship among people and divides organization's work, shows who reports to who

Rack Jobbers

wholesalers that furnish racks or shelves full of merchandise to retailers, display products, and sell on consignment

Cash-And-Carry Wholesalers

wholesalers that serve mostly smaller retailers with a limited assortment of products

Drop Shippers

wholesalers that solicit orders from retailers and other wholesalers and have merchandise shipped directly from a producer to buyer

Organizational Culture

widely shared values within organization that provide unity and cooperation to achieve common goals

Telecommuting

working from home via computer

Digital Natives

young people who have grown up using Internet