Chapter 3: Small Business Environment: Managing External Relations

List steps for Making Ethical Decisions

1) Define the moral problem 2) Generate alternatives 3) Implement best alternative

Baldrige Award

Stands for the International Standards Organization, and refers to certification for having met a standard of quality that is consistently evaluated around the world (see www.iso.org).

Legitimacy

The belief that a firm is worthy of consideration or doing business with because of the impressions or opinions of customers, suppliers, investors, or competitors.

social network

The entrepreneur's set of relation- ships and contacts with individu- als and institutions.

external relations

The general description for the processes and skills used in the management of a firm's interactions with people, organizations and institutions outside of its boundary.

networking

interacting with others in order to build relationships useful to a business

mutuality

the action of each person helping another

External Environment

the forces, institutions and people (i.e., the rest of the world) outside the boundary of the firm

trade magazines

the magazines that target specific industries and professions

environment

the sum of all the forces outside the firm or entrepreneur

Bootstrapping

using low-cost or free techniques to minimize your cost of doing business

BATNA

A Latin expression that means "let the buyer beware," which has been made into a philosophy sometimes used by businesses to put the bur- den for consumer protection onto the customer.

caveat emptor

A Latin expression that means "let the buyer beware," which has been made into a philosophy sometimes used by businesses to put the burden for consumer protection onto the customer.

general environment

A part of the external environment made up of sectors of major forces that shape the people and institutions of the task and internal environments, such as the economic sector or the demographic sector

ethical dilemma

A situation that occurs when a person's values are in conflict, making it unclear whether a particular decision is the right thing to do.

Billboard principle

An ethical model that asks whether someone would be comfortable having his or her decision and name advertised on a billboard for the public to see

universalism

An ethical model that suggests that there is a code of right and wrong that everyone can see and follow

organizational identity

Part of the BRIE model; composed of the name, description, and distinctive elements of a firm, such as trademarks, uniforms, logos, characters, and stories.

ISO

Stands for the International Stan- dards Organization, and refers to certification for having met a stan- dard of quality that is consistently evaluated around the world (see www.iso.org).

internal environment

The people and groups within the boundary of a firm, including the owners, managers, employees, and board members of the firm

ethics

a system of values that people consider in determining whether actions are right or wrong

billboard principle

an ethical model that asks whether someone would be comfortable having his or her decision and name advertised on a billboard for the public to see

social capital

characteristics of a business such as trust, consistency, and networks, that represent potential social obligations that are assets of the firm or entrepreneur.

ISO 14001 certification

A certification awarded to organizations for creating and implementing an environmental management system that meets the requirement of the International Standards Organization.

social capital

Characteristics of a business, such as trust, consistency, and networks, that represent potential social obligations that are assets of the firm or entrepreneur.

Task Environment

a part of the external environment made up of those components that the firm deals with directly such as customers, suppliers, consultants, media, interest groups, and the like.

entrepreneurial ecosystem

a specific configuration that reflects the components that are most central to developing a strong and active community of start-up businesses. The components are entrepreneurs, government, universities, investors, service people, mentors, and large organizations.

utilitarianism

an ethical model that supports seeking the greatest good for the greatest number of people

Golden Rule

an ethical model which suggests you treat others in the manner you wish to be treated

List the PROFIT sorceresses:

Property/Physical: Buildings, land, equipment, raw materials ∙ Relational: Customers, networks, distributors, social capital ∙ Organizational: Systems, structures, operational procedures ∙ Financial: Money, lines of credit, crowdfunding, bartering ∙ Intellectual (also known as Human): Employees, contractors, advisers, consultants, and the skills the business needs or has ∙ Technological: Patents, trademarks, ideas, copyrights, licenses, access to technology or expertise networks