Business Studies Exam Prep: Vocabulary and Concepts

Comprehensive vocabulary and key concepts from the Business Studies practice paper, covering management styles, marketing, finance, human resources, and legal structures.

Indemnification

The process where a business is put back in the same financial position it was in before a loss, protecting its cash flow.

Transactional Manager

A manager who uses a system of rewards and punishments to achieve results.

Induction

The process, often including mentoring, used to help a new employee settle into the business culture.

Macro Environment

The broad, uncontrollable environment outside a business that includes factors like inflation.

Market Map

A tool used to compare price and quality of products against competitors.

Work-to-rule

A form of industrial action where employees do only the bare minimum required by their contracts.

Collective Bargaining

Negotiation between an employer and a trade union regarding pay and working conditions.

People Policy

A marketing element that focuses on staff behavior, skills, and morale, and how they affect the customer experience.

Accountability

The principle of owning up to a mistake that happened under your watch.

Functional Conflict

Healthy conflict within a team that produces genuine benefits for the organization.

Balanced Scorecard

A strategic tool that includes a 'learning and growth' perspective to look at the strategic role of people.

PR (Public Relations)

The business function responsible for building and protecting the image of the business with the public and managing crises.

Contractual Capacity

The legal allowance to enter into binding contracts.

Current Ratio

A financial ratio calculated as $\frac{\text{Bank} + \text{Debtors} + \text{Inventory}}{\text{Current Liabilities}}$, expressed as a ratio to 1.

Liquidation Strategy

A strategy involving the selling off of assets to pay debt.

Retrenchment

A strategy of cutting back on staff or operations to remain sustainable when a business can no longer afford them.

Line-and-staff Structure

An organizational structure that includes advisors, unlike a pure line structure.

Benchmarking

The practice of comparing your own business methods to how others do it.

Stop-loss Strategy

A strategy that sets a specific price at which an investment is sold to cut losses.

Value Analysis

The process of looking at cutting the cost of a product's components to boost its overall value.

Lock-out

A situation where an employer shuts employees out of the workplace until they accept certain terms.

Staff Retention

The practice of keeping existing staff rather than replacing them.

Bullish Market

A market that is expected to go up (opposite of bearish).

Resource-based Analysis

An internal analysis looking at the business's own tangible and intangible assets.

Porter's Forces

A strategic model that looks at rivals and competitors within an industry.

Proximate Cause

The principle of checking that a loss was directly caused by the insured event.

Intrapreneur

Some who innovates on behalf of their employer rather than for their own business.

Average Clause

A clause that reduces an insurance payout if the asset was under-insured.

Job Description

A document listing the duties and level of supervision required for a role.

Job Specification

A document listing the specific personal requirements and qualifications for the person in a role.

Mediation

A process where a mediator suggests a non-binding solution to a conflict.

Differentiation

The strategy of making a business offering different from those of competitors.

Product Life Cycle

The stages a product goes through from its launch through to its withdrawal from the market.

Delegation

The act of a manager handing over tasks to subordinates.

Memorandum of Association

A document setting out the rules governing a company, including its objectives and the rights of shareholders and directors.

Limited Liability

A legal condition where shareholders can only lose the amount they invested, protecting their personal assets.

GRI (Global Reporting Initiative)

A standard framework for businesses to report on their economic, social, and environmental (sustainability) performance.

Substantive Fairness

In dismissal, this refers to whether there was a valid and reasonable reason for the dismissal.

Procedural Fairness

In dismissal, this refers to whether the correct legal process, such as a disciplinary hearing, was followed.

Fixed Notice Deposit

A low-risk short to medium-term investment where capital is held by a bank for a fixed notice period with a fixed interest rate.

Equities

High-risk long-term investments in shares where returns come through dividends and share price growth.

Triple Bottom Line

A reporting framework consisting of three elements: People (social), Planet (environmental), and Profit (economic).

Conceptual Skills

The management competency used to see the bigger picture and plan for expansion or long-term goals.