MANAGEMENT TOOLS AND PRINCIPLES
CHAPTER 1: Developing a Business Mindset
Intro VOCAB
-Business: Any profit-seeking organization that provides goods and services designed to satisfy
customers’ needs. Also called firm
- Revenue: Money a company brings in through the sale of goods and services.
- Business model: A concise description of how a business intends to generate revenue.
- Competitive advantage: Some aspects of a product or company that makes it more appealing to
target customers.
- Goods-producing businesses: Companies that create value by making “things” (most tangible)
-Service business: Companies that create value by performing activities that deliver some benefit to
customers.
-Barrier to entry: Any resource or capability a company must have before it can start competing in
a given market.
MANAGERS
-Human skills (communicative, motivate, lead, inspire enthusiasm and trust)
RISK AND REWARD
-A company needs to see some promise of reward before it will decide to accept the risks involved
in creating and selling products.
- if the decisions turn out bad, that company should suffer the consequences, not someone else.
BUSINESSES
- Composed of ppl, have a purpose, a deliberate structure
-Businesses add value by transforming lower-value inputs to higher-value outputs.
- 2 categories: goods producing (need + money) and services businesses (need + ppl)
BUSINESS MODEL CANVAS
- Value: the advantages of the product/service
- Costumer Target: audience (mass, or specific)
-Costumer relations: How to get people to buy it
-Channels: How to sell the product (online, retails stores).
-Retail activities: marketing, design, R&D (investigation)
-Key resources: people, tech, patents
-Key partners: Original Equipment Manufacturers (OEM)
-Revenue streams:
-Costs: manufacturing, labor, marketing, distribution
3 STEPS TO MAKE THE LEAP FROM CONSUMER TO BUSINESS PROFESSIONAL
- develop a business mindset that views business from the inside out rather than the outside in
-Recognize the positive and negative effects that business can have on society
- Develop a business vocabulary and explore the wide variety of jobs in the field of business
FIVE MAJOR ENVIRONMENTS IN WHICH EVERY BUSINESS OPERATES
,-Social: trends
- Tech: can create and destroy markets
- Economic: cost and availability of goods, services, labor
-Legal and regulatory: rules and regulations relating to business activity
- Market: target costumers, the buying influences that shape the behavior of those customers, and
competitors that market similar products to those customers.
PESTLE (environments for business)
-Political: type of government, situation of the country
-Economic: conditions, GDP, inflation
-Social: trend, culture, demographics, religion
-Technology: number of patents, innovation, penetration of internet, number of smartphones,
infrastructure of a country. Tech can also disrupt businesses.
DISRUPTIVE TECH
-3D Printing
-Artificial intelligence
-Automation
-Internet of things
-Mobile connectivity
- Augmented reality (seeing something in the phone that isn’t there pokemon go)
PURPOSE OF THE SIX MAJOR FUNCTIONAL AREAS IN A BUSINESS ENTERPRISE
-Research and development (R&D): designs and creates the goods and services that a company can
manufacture or perform for its customers.
- Information Technology (IT): Systems that promote communication and information usage
through the company or that allow companies to offer new services to their customers.
-Manufacturing: production, or operations is the part of the company where the firm makes
whatever it makes or performs whatever services it performs.
-Marketing: sales, distribution, and customer support are responsible for identifying market
opportunities, crafting promotional strategies, and making sure customers are supplied and
satisfied with their purchases.
- Finance and accounting: plan for the company’s financial needs, control spending, and report on
financial matters.
- Human resources: recruits, hires, develops, and supports employees.
SEVEN OF THE MOST IMPORTANT BUSINESS PROFESSIONS.
-Operations managers: oversee all the people and processes involved in creating the goods and
services that a company sells.
-HR specialists and managers: plan and direct HR activities such as recruiting, training and
development, compensation and benefits, employee and labor relations, and
health and safety.
-Information Technology managers: oversee the design, implementation, and maintenance of
systems that help deliver the right information at the right time to the right people in the
organization. Communication aswell.
, -Marketing specialists: perform one or more tasks involved in identifying and understanding
market opportunities and shaping the product, pricing, and promotional strategies needed to
pursue those opportunities.
-Sales professionals: build relationships with customers and help them make purchase decisions.
-Accountants: collect, analyze, and report on financial matters; they also perform audits to verify
financial reports or find ways to lower costs.
-Financial managers: plan for the company’s financial needs, invest funds, and raise capital.
SEVEN COMPONENTS OF PROFESSIONALISM.
-Professionalism is the quality of performing at a high level and conducting yourself with purpose
and pride.
-Seven key traits of professionalism are:
- striving to excel
- being dependable and accountable
- being a team player
- communicating effectively
- demonstrating a sense of etiquette
- making ethical decisions
- maintaining a positive outlook.
CHAPTER 2: Understanding Basic Economics
L.Os
1. Define economics, and explain why scarcity is central to economic decision making
2. Differentiate among the major types of economic systems
3. Explain the interaction between demand and supply.
4. Identify four macroeconomic issues that are essential to understanding the behavior of
the economy.
5.Outline the debate over deregulation, and identify four key roles that governments play in
the economy.
6. Identify the major ways of measuring economic activity.
ECONOMICS
-Study of how a society uses its scarce resources to produce and distribute goods and services.
-Scarcity is a crucial concept in economics because it creates competition for resources and forces
everyone to make trade-offs.
VOCAB
-Microeconomics: The study of how consumers, businesses, and industries collectively determine
the quantity of goods and services demanded and supplied at different prices.
-Macroeconomics: The study of “big-picture” issues in an economy, including competitive behavior
among firms, the effect of government policies, and overall resource allocation issues
-Natural Resources: Land, forests, minerals, water, and other tangible assets usable in
-Human resources: All the people who work in an organization or on its behalf.
-Capital: The funds that finance the operations of a business as well as the physical, human-made
elements used to produce goods and services, such as factories and computers.
