BUS Midterm

Capitalism

all or most of the factors of production and distribution are privately owned and operated for profit

Line and Staff Organization

allows for back and forth communication line people= can make decisions staff people= cannot make decisions only advise

Importing

buying products from another country

Malthus

dismal science/resources will run out and the poor will overpopulate the government needs to be involved

Oligopoly

few sellers dominate the market

Cross Functional Organization

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

things that impact inventory

obsolescence pilferage damage

Mission Statement

outlines organizations purpose

Exporting

selling products to another country

Human Skills

skills that involve communication and motivation; they enable managers to work through and with people

Technical Skills

skills that involve the ability to perform tasks in a specific discipline or department

Conceptual Skills

skills that involve the ability to picture the organization as a whole and the relationship among its various parts

Franchising

someone with a good idea for a business sells the right for others to use it

Six Sigma Quality

standard of quality for many businesses allows 3.4 defects/million transactions

Types of skills

technical, human, conceptual

Price

tells companies how much they should produce (this is the key to a free market)

perfect competition

there are many sellers in a market and none is large enough to dictate the price of a product

absolute advantage

when a country produces a product more efficiently than all the others

technology makes businesses (3 things)

1. effective 2. efficient 3. productive

when in an ethical dilemma ask...

1. is it legal 2. is it balanced 3. how will this make me feel about myself

Line organization

An organization that has direct two-way lines of responsibility, authority, and communication running from the top to the bottom of the organization, with all people reporting to only one supervisor.

LLP (Limited Liability Partnership)

Deals with liability for partners through 1. Partners are not held liable for each others actions 2. Liability is limited to losing only personal assets directly related to personal actions 3. When a partner is sued individually for malpractice it does not affect the other partners a. Ex is doctors office or law firm

Departmentalization and ways to divide

Divides organizations into separate units. ways to divide: by function by product, by process, ect

division of labor

Division of work into a number of separate tasks to be performed by different workers

economies of scale

The situation in which companies can reduce their production costs if they can purchase raw materials in bulk; the average cost of goods goes down as production levels increase.

factors of production and what are the two most important

1. Land 2. Labor 3. Capital 4. Entrepreneurship 5. Knowledge 4/5 are most important

Types of Leadership Styles

1. Participate= managers and employees decide together 2. Autocratic= manage decisions without others 3. free reign = employees are free to do what they want

4 Functions of management

1. Planning 2. Organizing 3. Leading 4. Controlling

4 Functions of management and which one is most important

1. planning 2. leading 3. organizing 4. controlling planning(goal setting) is most important

what percentage of businesses survive their first year?

80%

LLC (Limited Liability Company)

A company similar to an S corporation but without the special eligibility requirements. Pros: limited liability/choice of taxation Cons: no stock/ few incentives/ limited life span

joint Venture

A partnership in which two or more companies (often from different countries) join to undertake a major project. Pros: shared technology and risk Cons: 1 partner can learn the product and then steal the idea

Entrepreneurship

A person who risks time and money to start and manage a business

Operations Management

A specialized area in management that converts or transforms resources (including human resources) into goods and services.

decentralized organization

An organization structure in which decision-making authority is delegated to lower-level managers more familiar with local conditions than headquarters management could be.

Keynes

English economist who advocated the use of government monetary and fiscal policy to maintain full employment without inflation

JIT

Just in Time. A system that eliminates work-in-process (WIP) inventory by scheduling arrival of parts and assemblies for an operation at the time they are needed and not before. limits inventory

Objectives

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

Goals

The broad, long-term accomplishments an organization wishes to attain.

market price

The point where supply and demand are equal

computer-integrated manufacturing (CIM)

The uniting of computer-aided design with computer-aided manufacturing.

Smith

The wealth of Nations and father of economics: believed in freedom and the idea that people will work hard if they are incentive's less government involvement

Vision

a broad explanation of why the company exists and where it is going

Sole Proprietorship

a business owned and managed by a single individual Pros: set your own hours/be your own boss Cons: unlimited liability/ limited financial resources

Corporate Social Responsibility

a business's concern for society's welfare

Licensing

a firm allows a foreign company to pay it a fee to make or distribute the firm's product or service

Corporation

a legal entity with authority to act and have liability apart from its owners Pros: limited liability /able to raise more money for investment Cons: high initial cost/extensive paperwork

Partnership

a legal form of business with two or more owners Pros: more financial resources/ shared knowledge and skills Cons: unlimited liability / division of profits

centralized organization

an organization structure in which decision-making authority is maintained at the top level of management

non-profit organization

an organization whose goals do not include making a personal profit for its owners or organizers used to reach social and educational goals

decision making

attempting to select the best alternative among several options

Fayol

created 14 principles of management uses the idea of top down management also developed division/ specialization of labor

integrity based

defines their values and creates environment with ethically sound behavior and accountability

Max Weber

developed pyramid management with top management, middle management, and front line workers

Intrapreneurship

entrepreneurship within an existing organization

Goals VS Objectives

goals = broad long term accomplishments objectives= short specific details of how to achieve goals ( this is a set vision/mission statement)

SWOT Matrix

internal Strengths internal Weaknesses potential Opportunities potential Threats

Microeconomics

looks at the behavior of people and organizations in markets EX: will people buy smaller cars when gas prices increases

matrix structure

most common but also costly to run. you can assign specific people to projects An organization in which specialists from different parts of the organization are brought together to work on specific projects but still remain part of a line-and-staff structure. Cons: issues of loyalty can arise as workers don't know who to answer to

Profit Organization

motive is to make a profit

Monopoly

one seller controls the total supply of a product or service and sets the price

What factors determine facility location?

partners/suppliers customers fiscally wise

compliance based

preventing unlawful behavior by increasing control

What is the difference between quality of life and standard of living?

quality of life is the general well being of society( safety, healthcare,ect) Standard of living is the amount of goods and services that people can buy

demand

quanity consumers will buy at a given price

supply

quantity businesses will sell at a given price

standard of living

refers to the amount of goods and services people can buy with the money they have

quality of life

refers to the general well-being of a society in terms of its political freedom, natural environment, education, health care, safety, amount of leisure, and rewards that add to the satisfaction and joy that other goods and services provide

Socialsim

some if not most should be owned by the government to distribute profits evenly

comparitive advantage

the ability to produce a good at a lower opportunity cost than another producer

Foreign Direct Investment

the buying of permanent property and businesses in foreign nations Pros: parent company maintains control Cons: they must commit to the deal with foreign funds

risk

the chance an entrepreneur takes of losing time and money on a business that may not prove profitable

Communism

the government makes almost all economic decisions and owns almost all the major factors of production

span of control

the less specialized the job the broader the span of control

Macroeconomics

the operation of a nations economy as a whole

Ethics

the standard for moral behavior that is accepted as right v wrong

Economics

the study of how society chooses to employ resources to produce goods and services and distribute them for consumption

production management

the term used to describe all the activities managers do to help their firms create goods

computer-aided design (CAD)

the use of computers in the design of products

computer-aided manufacturing (CAM)

the use of computers in the manufacturing of products

How did ford cut costs to produce his first car?

using economies of scale( company produces materials in bulk to reduce cost)