Exploring Business 1
Exploring Business 1 BUS - 10123 - 002
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This 8 page Class Notes was uploaded by Armani Lindsay on Sunday January 31, 2016. The Class Notes belongs to BUS - 10123 - 002 at Kent State University taught by Eric Von Hendrix (P) in Winter 2016. Since its upload, it has received 48 views.
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Date Created: 01/31/16
Chapter 1: T aking Risks and Making Profits within the Dynamic Business Environment Vocabulary Goods -- Tangible products such as computers, food, clothing, cars and appliances. Services -- Intangible products (that can’t be held in your hand) like education, healthcare, insurance, recreation and travel. Business -- Any activity that seeks to provide goods and services to others while operating at a profit. Entrepreneur -- A person who risks time and money to start and manage a business. Revenue -- The total amount of money a business takes in during a given period by selling goods and services. Profit -- The amount of money a business earns above and beyond what it spends for salaries and other expenses. Loss -- Occurs when a business’s expenses are more than its revenues. Risk -- The chance an entrepreneur takes of losing time and money on a business that may not prove profitable. Standard of Living -- The amount of goods and services people can buy with the money they have. Quality of Life -- The general well-being of a society in terms of its political freedom, natural environment, education, healthcare, safety, amount of leisure and rewards that add to personal satisfaction. Stakeholders -- All the people who stand to gain or lose by the policies and activities of a business and whose concerns the businesses need to address. Outsourcing -- Contracting with other companies (often in other countries) to do some of the firm’s functions, like production or accounting. Insourcing -- Foreign companies opening offices and factories in the United States. Nonprofit Organization -- An organization whose goals do not include making a personal profit for its owners or organizers. Technology -- Everything from phones to copiers and the various software programs that make businesses more effective, efficient and productive. Effectiveness -- Producing the desired result. Efficiency -- Producing goods and services using the least amount of resources. Productivity -- The amount of output you generate given the amount of input (example: hours you work). E-Commerce -- The buying and selling of goods online. Database -- An electronic storage file for information. Identity Theft -- The obtaining of individuals’ personal information, such as Social Security and credit card numbers, for illegal purposes. Empowerment -- Giving frontline workers the responsibility, authority, and freedom to respond quickly to customer requests. Demography -- The statistical study of the population in terms of size, density and characteristics like, age, race, gender and income. Climate Change -- Movement of the temperature of the planet up or down over time. Greening -- Trend toward saving energy and producing products that cause less harm to the environment. Notes Business • Successfully filling a market need means you could make money for yourself and provide jobs for others. • Success in business is often based on the strategy of finding a need and filling it. • Not all businesses make the same amount of profit. • Businesses take risks, but with great risks could come great profit. Taxes are used to provide: • Hospitals • Schools • Libraries • Playgrounds • Roads • Fire Protection • Police Protection • Environmental Programs • Support for People in Need • The U.S. has one of the highest standards of living in the world. • Workers in other countries may make more money, but prices for products are higher. • Who are Stakeholders? • Customers • Employees • Stockholders • Suppliers • Dealers • Community Members • Media • Elected Officials • Bankers • Environmentalists Well known nonprofit organizations are United Way, American Heart Association, Salvation Army, American Cancer Society, and American Red Cross Entrepreneurship The UPSThe DOWNS The freedom to succeed. The freedom to fail. Make your own decisions. No paid vacations. High possibility of wealth. No health insurance. Hire your own staff. No daycare. • Millions of people have started businesses and succeeded. • The number of Hispanic-owned businesses in the U.S. has grown dramatically. • Women now own over one-third of all businesses. Entrepreneurs use what they’ve learned to grow their businesses and increase wealth. 5 factor if production: Land, labor, capital, entrepreneurship, Knowledge The advantage of working for others is that someone else assumes the company’s entrepreneurial risk and provides benefits. Government’s Role in Business Government can promote business by… 1. Minimizing spending and keeping taxes and regulations to a minimum. 2. Allowing private ownership of businesses. 3. Minimizing interference with the free exchange of goods and services. 4. Passing laws that enable businesspeople to write enforceable contracts. 5. Establishing a currency that’s tradable in world markets. 6. Minimizing corruption. The number of employees calling in sick has reached a five- year high. 3/5 of all callers were not even sick. Others conduct personal business at work, play video games and check their Facebook pages while at work. What is the problem with this situation? What are the alternatives? What are the consequences of each alternative? What path would you choose? Is it ethical? Benefits of Technology - B2C: Business to Consumer - B2B: Business to Business - 80% of cyber-attacks involve weak passwords. - Since 2012, there has been an 8% increase in malware attacks with an average loss of $92,000! - Since 2012, there has been a 125% increase in social media phishing attacks, stealing over $1 billion from businesses. - 29% of security breaches are hackers pretending to be you and resetting your passwords. Follow these steps to help protect yourself: • Protect your Social Security Number. • Shred financial documents and items with personal information. • Don’t give out personal information unless you know whom you are dealing with. • Use strong passwords. • Never click links in suspicious emails. • Monitor your credit report. • Customers want quality products at a good price with excellent customer service. • Because business is more customer-driven, some managers give frontline employees more decision-making power. • The U.S. Equal Employment Opportunity Commission prohibits laws discriminating against: • Age • Disability • Genetic information • National origin • Pregnancy • Race • Religion • Sex IMPORTANT CHANGES to the GLOBAL ENVIRONMENT • Growth of global competition. • Increase of free trade among nations. • Development of efficient distribution systems. • Advances in communication systems. • Wars cost billions of dollars. • Tax money is diverted. • Cost of security goes up. • Cost of insurance goes up. • Agriculture Era • Manufacturing Era • Service Era • Information-Based Era The SERVICE ERA • Makes up over 70% of the U.S. economy. • Since the mid-1980s, the service industry generated almost all the increases in employment. • More high-paying jobs in service industries. The Business Environment: Consists of the surrounding factors that either help or hinder the development of business. The five elements of the business environment are the economic and legal, technological, competitive, social, and global business environment. Businesses that create wealth and jobs grow and prosper in a healthy environment.
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