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