DECA Business Administration Core - Performance Indicators

Explain types of business ownership. (CS)

Sole Proprietorship - owned/run by one individual who receives all profits and is responsible for loss/debt; limited capital, unlimited liability

Partnership - partners agree to cooperate in working toward mutual interests; combined capital, unlimited financial ability

Corporation - sells shares in stock market, company is owned by multiple shareholders, allows for limited liability, greater financial power by issuing stock

Monopoly - one supplier, no substitute goods or services readily available

Private LLC - limited liability, no shares of stock

Nonprofit - uses revenue to achieve social goals

Franchise - chain of suppliers providing goods/services

Cooperative/Joint Venture - run/managed by employees

Identify sources that provide relevant, valid written material. (PQ)

Government publications, reputable news outlets, textbooks, and professional research papers provide relevant, valid written material. One should verify an author's credentials to determine credibility.

Analyze company resources to ascertain policies and procedures. (CS)

Consulting the employee handbook or one's co-workers can ascertain one of company policies and procedures.

Explain the nature of effective verbal communications. (PQ)

Effective verbal communication can be formal or informal, and is when a speaker appears confident and "in the know." This can influence/persuade the listener.

Handle telephone calls in a businesslike manner. (CS)

State your contact information, say "How may I help you?", speak as if it were a real business meeting

Participate in group discussions. (CS)

Ask relevant questions, respect the opinions of others, work together with the intention of meeting a goal.

Explain the nature of effective written communications. (CS)

Effective written communications should contain all of the necessary information, have proper formatting/conventions, and attempt to persuade or inform the reader.

Select and utilize appropriate formats for professional writing. (CS)

Business letters are most appropriate for professional writing as they contain contact information and the address.

Edit and revise written work consistent with professional standards. (CS)

Written work contains professional and advanced vocabulary and slang should not be used.

Write business letters. (CS)

Business letters should contain the contact information and address of the sender, while containing a formal greeting/closing and a professional body.

Write informational messages. (CS)

Informational messages contain a variety of information that has different levels of importance. It is usually presented in order of importance, so that the reader can clearly understand. Information should be explained throughly.

Describe the impact of a person's social media brand on the achievement of organizational objectives. (CS)

Social media can improve the public image of a person and allow them to connect with customers and advertise/market more effectively.

Distinguish between using social media for business and personal purposes.

Social media can be used personally to communicate with friends and family, while professionally to promote products and events.

Explain the nature of staff communication. (CS)

Types of Staff Communication:

Upward - subordinate -> manager (same dept.)

Downward - manager -> subordinate (same dept.)

Horizontal - same hierarchical level

Diagonal - subordinate <-> manager (diff. depts.)

Grapevine - circulation of rumors and unofficial info

Choose and use appropriate channels for workplace communication. (CS)

Appropriate channels for communication in the workplace include email and in-person communication. Employees should refrain from using social media and group messaging apps to communicate.

Participate in a staff meeting. (CS)

All employees should participate in the discussion. The purpose of staff meetings is to discuss issues that are of importance to the business, or to solve problems. Therefore, ideas and opinions are valuable. Employees should not comment on ever detail, should explain their ideas adequately, and not cause arguments with those who disagree.

Demonstrate a customer-service mindset. (CS)

By being welcoming and encouraging to customers and helping them, employees can demonstrate a customer-service mindset.

Develop rapport with customers. (CS)

By exhibiting empathy with customers and being understanding, employees can build rapport with and retain customers.

Respond to customer inquiries. (CS)

Customer inquiries should be responded to with all necessary and relevant information in an assertive and friendly manner. Make sure your response is accurate and clear. If you are not sure, refer to company handbook or upper management.

Adapt communication to the cultural and social differences among clients. (CS)

Employees should refrain from using derogatory, racist, and sexist vocabulary. They should determine when it is appropriate to utilize more casual or more professional communication.

Interpret business policies to customers/clients. (CS)

The business policy should be stated in a colloquial and politically correct manner to those who do not understand it.

Handle difficult customers. (CS)

Difficult customers should have their needs heard and handled professionally through employees explaining policies and negotiating terms.

Types of Difficult Customers:

Domineering - acts like a know-it-all

Suspicious - doesn't trust anyone

Slow/Methodical - takes forever to make a decision

Dishonest - lies about pricing, promotion rules, etc.

Disagreeable - tells you how to do your job

Identify company's brand promise. (CS)

A company brand's promise is a statement in which a company promises to provide and abide by a set criteria of performance and reliability.

Determine ways of reinforcing the company's image through employee performance. (CS)

Employees at a company should be seen as diligent such that more people will apply for jobs and more customers will purchase the company's products.

Explain the concept of economic resources. (CS)

Economic resources are the factors used in producing goods or providing services. In other words, they are the inputs that are used to create things or help you provide services. Economic resources can be divided into human resources, such as labor and management, and nonhuman resources, such as land, capital goods, financial resources, and technology.

Capital Resources - assets, monetary value

Human Resources - labor/management

Natural Resources - raw materials

Describe the concept of economics and economic activities. (CS)

Economics is the study of meeting unlimited human wants and examining their behavioral patterns in regards to money based on various environmental, social, political, personal, and psychological factors. This includes strategy involved in various economic activities in order to attract consumers of the target market and generate more cash flow.

Economic Activities:

Production - creation of a good/service

Distribution - making good/service available

Consumption - usage of a good/service

Determine economic utilities created by business activities. (CS)

Form Utility - configuration of product; Changing raw materials or putting parts together to make them more useful

Place Utility - physical location; Having a product where customers can buy it.

Time Utility - timing of service; Having a product available at a certain time of year or a convenient time of day.

Possession Utility - terms of ownership; The exchange of a product for some monetary value; cash, checks, credit/debit cards, and etc.

Information Utility - communication with the consumer; information on websites, emails and etc.

Explain the principles of supply and demand. (CS)

Supply - availability of good/service

Demand - public desire for good/service

Law of Supply - price and supply are positively correlated because it is more profitable and suppliers are more willing to produce/offer good/service

Law of Demand - price and supply are negatively correlated because less people are willing to pay for said good/service

Elasticity - sensitivity of supply/demand to increasingly subtle changes in price (high elasticity = sensitive to smaller changes in price, no elasticity = no change in supply/demand regardless of price)

Market Equilibrium - price at which supply and demand are equal, correlates with equilibrium quantity, assessed by economists in order to avoid shortage or surplus

Shortage - price too low, supply less than demand, not enough for every consumer

Surplus - price too high, supply higher than demand, capital wasted on resources for things no one wants

Factors Affecting Supply:

Resource Price - negative correlation

Related Product Price - negative correlation

Number of Suppliers - positive correlation

Technological Advancement - positive correlation

Expected Future Prices - positive correlation

Factors Affecting Demand:

Substitute Price - positive correlation

Complement Price - negative correlation

Expected Future Prices - positive correlation

Income - positive correlation (except for low-value)

Population - positive correlation (except for low-value)

Describe the functions of prices in markets. (CS)

The price of a good or service is how much it costs per unit or time period. Based on factors affecting supply and demand in the current marketplace, the price determines an forecasted quantity supplied and demanded, allowing a business to determine what price to set in order to accomplish market equilibrium.

Describe types of business activities. (CS)

Operations - includes every activity needed to manufacture a product or provide a service; improving quality/efficiency

Marketing - targeting needs and desires of consumers; determines the specifications of products and services, proper pricing, the best distribution channels, and packaging;

Finance - When approached carefully, finance activities build a foundation for a company's security, ensuring future operations. Creating budgets, allocating funds throughout the company, determining investments, protecting assets, managing credit and preparing financial reports are other necessary financial activities; balance sheet (assets vs. liabilities) and income statement determine profit vs. loss

Explain the types of economic systems. (CS)

Traditional - unregulated perfect competition

Command - government monopolies

Market - unregulated, various forms of competition

Mixed - regulated, various forms of competition

Identify the impact of small businesses/entrepreneurship on market economies. (CS)

Market economies are completely unregulated, meaning that there are few barriers to entry and startups can easily make contributions to society and profit.

Identify factors affecting a business's profit. (CS)

Supply/Demand

Competition

Global Environment

Expansion - into new markets (vertical integration)

into various brands (horizontal integration)

Determine factors affecting business risk. (CS)

Human Risk - possibility of loss caused by humans

Economic Risk - unfavorable market conditions

Natural Risk - natural disasters

Explain the concept of competition. (CS)

Competition is the amount of businesses and differentiation among their goods and services within a certain market.

Types of Competition:

Monopoly - 1 business, no differentiation

Oligopoly - few businesses, low differentiation

Monopolistic Competition - many businesses, high differentiation

Perfect Competition - many businesses, no differentiation

Duopoly - 2 dominant suppliers

Collusion - classified suppliers (e.g. government weapons suppliers)

Cartel - association of suppliers with high prices and low competition

Determine the relationship between government and business. (CS)

There are government agencies and legislation to impose regulations on business activities, but businesses can influence political decision-makers.

Explain the concept of productivity. (CS)

Productivity is a quantitative measure of the ratio of outputs to inputs. When productivity is lower than necessary, inflation occurs due to more input (resources) resulting in less output (money), decreasing each individual unit of money's value.

Describe the nature of emotional intelligence. (PQ)

Emotional intelligence is the ability of an individual to recognize their own and other's emotions to discriminate between different emotions and to act appropriately.

Explain the concept of self-esteem. (PQ)

Self-esteem is a person's overall subjective emotional evaluation of his or her own worth. One can improve his/her self-esteem by assessing their strengths and appreciating them.

Recognize personal biases and stereotypes. (PQ)

Bias - tendency/perspective to a certain thing

Stereotype - broad generalization about something

Identify desirable personality traits important to business. (PQ)

Some desirable personality traits for business include multitasking, strategic thinking, diligence, confidence, decisiveness, leadership, initiative, and team-orientedness.

Exhibit self-confidence. (PQ)

Self-confidence can be exhibited through a calm yet assertive tone of voice, clear articulation and enunciation, and through knowledge of the subject under discussion.

Demonstrate responsible behavior. (PQ)

Responsibility can be demonstrated by leaders through taking responsibility for both necessary tasks and faults.

Demonstrate ethical work habits. (PQ)

Employees with good work ethic demonstrate reliability, a positive attitude, communication skills, and motivation.

Take responsibility for decisions and actions. (PQ)

When a task needs to be carried out, the responsible employee should step up to the plate. However, if something goes wrong, s/he should take the blame.

Manage commitments in a timely manner. (CS)

Commitments should be managed in a timely manner by not procrastinating, and utilizing sequential tasking. If applicable, multitasking can be a powerful productivity tool.

Explain the use of feedback for personal growth. (PQ)

Critical feedback can be used for insight on personal strengths and weaknesses and how these attributes can be perfected to improve work ethic.

Adjust to change. (PQ)

Change is common in the workplace and by adapting policies, work habits, and routines this change can be adjusted to.

Respect the privacy of others. (PQ)

Privacy is an important component of virtue and employees must not violate it by looking through personal communications or eavesdropping on conversation.

Show empathy for others. (PQ)

Empathy is the capability of an individual to understand and sympathize with others' emotions through ways such as relevant questioning and reassurance.

Maintain the confidentiality of others. (CS)

Confidentiality is the protection of private information and employees must not violated by spreading personal information of others' to third parties.

Exhibit cultural sensitivity. (CS)

Cultural sensitivity is the ability of an individual to understand and relate to people of other races/cultures through ways such as refraining from racial slurs and accepting others' differences.

Explain the nature of effective communications. (PQ)

Effective communications can efficiently persuade or inform a group or individual through methods such as simplicity and action.

Use appropriate assertiveness. (PQ)

Exhibit self-confidence and assurance without being aggressive by being negotiable and encouraging.

Use conflict-resolution skills. (CS)

Conflict can be resolved through collaboration, compromise, or avoidance.

Explain the nature of office politics. (CS)

Office politics is a scenario in which multiple employees battle for dominance over decision-making. It can be helpful (clear leader) or harmful (uncontrollable conflict).

Overcome problems and difficulties associated with office politics. (CS)

By using negotiation techniques, office drama can be resolved in an effective manner.

Participate as a team member. (CS)

Teamwork includes leadership and collaboration. By providing input to a task and facilitating new initiatives, employees can be better team members.

Explain the concept of leadership. (CS)

Leadership is the concept of an individual or group of individual managing administrative tasks for an organization.

Types of Leadership:

Authoritarian - strictly professional, direct supervision

Paternalistic - father figure, more personal

Democratic - social equality

Laissez Faire - workers have all power

Transactional - system of rewards/punishments

Transformational - leads change and initiative

Determine personal vision. (CS)

Personal vision can be defined as a future goal that one hopes to attain. It should be SMART - Specific, Measurable, Achievable, Realistic/Relevant, and Time-Bound.

Demonstrate adaptability. (CS)

Adaptability is ability of an individual to adjust to changes in the workplace.

Develop an achievement orientation. (CS)

Tend to be leaders, set high standards, constantly learning, positive attitude, always performing the correct things while not being supervised.

Lead change. (CS)

Leaders should initiate positive feedback through methods such as assessing the current scenario, finding areas for improvement, brainstorming solutions, and implementing a course of action.

Enlist others in working toward a shared vision. (CS)

Collaboration is a powerful tool and it is important that fellow workers exhibit personality traits such as motivation, positive attitude, empathy, and conflict resolution skills in order to form the perfect work team.

Coach others. (CS)

Others may need coaching and leaders should do so by assessing weaknesses, brainstorming solutions, and suggesting them in an assertive manner.

Treat others fairly at work. (PQ)

Everyone should be treated the same, be heard, and have their rights protected regardless of race, gender, age, religion, or sexual orientation.

Foster positive working relationships. (CS)

Positive working relationships can be fostered through methods such as appreciating others, being positive, and building rapport with co-workers and clients.

Explain forms of financial exchange. (PQ)

Cash - paper money

Credit - legal obligation to pay at a later date

Check - legal document confirming consumer's will to pay

Electronic - virtual money

Investments - bought by speculator with expectation of higher yield/returns

Identify types of currency (paper money, coins, banknotes, government bonds, treasury notes, etc.)

(PQ)

Paper Money- Legal and Governmental value.

Bank notes- a piece of paper money, constituting a central bank's promissory note to pay a stated sum to the bearer on demand.

Treasury Notes- a note issued by the US Treasury for use as currency.

Currencies with High Effect on Global Markets:

U.S. Dollar

EU Euro

Chinese Yuan

British Pound

Describe functions of money (medium of exchange, unit of measure, store of value) (PQ)

Medium of Exchange - facilitate transactions

Store of Value - changes as economy fluctuates

Unit of Measure - common value of good/service

Describe sources of income (wages/salaries, interest, rent, dividends, transfer payments, etc.) (PQ)

Wage/Salary - periodic payment in exchange for labor

Interest - increased payment in exchange for time

Transfer Payment - government benefits

Wage Garnishment - court-ordered initiative

Explain the time value of money. (CS)

The time value of money (TVM) is the idea that money available at the present time is worth more than the same amount in the future due to its potential earning capacity. This core principle of finance holds that, provided money can earn interest, any amount of money is worth more the sooner it is received.

The value of money changes over time due to fluctuations in the foreign exchange market and domestic business cycles.

Picture this scenario:

Given a CPI of 10%, a bank offers you three options:

a) Receive $100 now

b) Receive $109 in a year

c) Receive $120 in two years

Which choice yields the greatest return?

A. In one year, $100 is worth $110, and in two years, it is worth $121, trumping both of the other choices by a dollar.

Explain the purposes and importance of credit. (CS)

Credit is borrowed to allow individuals to pay at a fixed date in the future and helps economy to grow.

Explain legal responsibilities associated with financial exchanges. (CS)

Good Faith - honest intention to fulfill obligation

Disclosure - information is accessible to outside entities

Important Finance Laws:

Sarbanes-Oxley Act - CEO/CFO verifies external docs

Dodd-Frank Act - strictest regulations since Great Depression

Gramm-Leach-Blilley Act - created financial services industry by combining banks, insurance, etc. into one industry

Explain the nature of financial needs. (CS)

Financial need is the necessity of money to purchase goods and services such as food, water, shelter, clothing, transportation, education, labor, etc.

Set financial goals. (CS)

Financial goals involve setting a budget of money that is to be used for purchase, money to be invested in stocks/bonds, and money to be saved in raw form for future use.

Develop a personal budget. (CS)

Types of Budgets:

Methods of Budgeting:

Explain the nature of tax liabilities. (PQ)

Tax liability is the amount owned to a taxing authority, typically the Internal Revenue Service (IRS). Form 1040 is the most common form used for personal income tax filing, with EZ and A variances, whereas Forms W-2 and W-4 are used in corporate finance in regards to payroll tax.

Interpret a pay stub. (PQ)

A pay stub, also known as a paycheck, is a legal notice including the monetary sums of salary, compensation, and stock bonus that has been deposited to an employee's bank account.

Prepare bank account documents (e.g., checks, deposit/withdrawal slips, endorsements, etc.) (PQ)

Bank account documents include deposit slips, withdrawal slips, checks, passbooks, and account statements. They should contain all necessary information (such as monetary sums).

Maintain financial records. (PQ)

Financial records should include any money spent or saved in a budget.

Read and reconcile bank statements. (PQ)

Bank statements include the financial transactions made over a certain period of time via bank account.

Demonstrate the wise use of credit. (CS)

Credit payments should add up to be less than the total income for the credit period.

Validate credit history. (CS)

Credit history should be checked frequently to ensure that all existent debts have been paid and that no nonexistent debts have been paid. Individuals often validate their credit history before applying for additional credit to make sure the information is accurate.

Protect against identity theft. (CS)

Individuals should avoid sharing personal information such as social security number (SSN) and credit card number to prevent identity theft. Use secure web browsers when purchasing online.

Prepare personal income tax forms (i.e., 1040 EZ form) (CS)

All documents should be gathered and all necessary information should be recorded, such as sources of income, amount of income, and sums of tax-deductible donations.

Describe types of financial-services providers. (CS)

Retail Bank - FDIC insured (0 risk), deposit/withdraw money, bank profits from investments

Credit Union - borrow money for business purposes

Insurance Company - transfer financial risk in exchange for premium

Brokerage Firm - middleman between investors and equities

Discuss considerations in selecting a financial-services provider. (CS)

Reputation and online reviews should be consulted when choosing a provider. The one with the most expertise should always take first priority.

Explain types of investments. (CS)

Mutual Funds - multiple investors pool in money

Real Estate - property ownership

Stocks - shares of corporations (part ownership)

Municipal Bonds - government notes sold for different value

Corporate Bonds - company borrows money

Describe the concept of insurance. (CS)

Insurance is the practice or arrangement by which a company or government agency provides a guarantee of compensation for specified loss, damage, illness, or death in return for payment of a premium

Describe the need for financial information. (CS)

Trends in finance can help businesses make decisions based on funds available and history of profits and losses.

Explain the concept of accounting. (CS)

Accounting is the action or process of keeping financial accounts.

Explain the role of finance in business. (CS)

The financial department of a business seeks to lower costs and utilize budget through methods such as budgeting, reporting, and forecasting.

Discuss the nature of human resources management. (CS)

Functions of HRM:

Determining need, determining job descriptions, recruiting, and screening and selecting applicants.

Planning/Analysis - assessing employees' performance and training

Employee Relations - liaisons between managers and subordinates

Health/Safety - ensuring compliance of workplace with OSHA regulations

Compensation/Benefits - payroll and benefits such as health insurance

HR Development - operations of dept.

Staffing - hiring

Equal Employment - working to make workplace more diverse

Explain marketing and its importance in a global economy. (CS)

Marketing is the concept of promoting a product to an audience with the goal of selling it to consumers. All businesses market their products and attempt to allow it to appeal to a global market in order to increase opportunity for profit.

Describe marketing functions and related activities. (CS)

Pricing - setting price

Product Management - development to meet needs

Distribution - making products available to consumers

Financing - budgeting for marketing activities

Marketing Information Management - researching trends and info on customers to develop strategies

Selling - communicating with customers to determine and satisfy needs

Promotion - advertising, personal selling, PR

Assess information needs. (CS)

Information needs to include several relevant data sets for comparison that can be used to brainstorm promotional strategies.

Obtain needed information efficiently. (CS)

Surveys can be used to obtain information on customer feedback, while federal documents can be a source of demographic data.

Apply information to accomplish a task. (CS)

Information can be applied to brainstorming promotional strategies appealing to the data findings.

Store information for future use. (CS)

Information can be stored in electronic spreadsheets and physical documents.