Business Management Vocabulary

Flashcards for Business Management Lecture Review

Management

The process of working with and through other people, coordinating a business’s resources to achieve its goals, in a rapidly changing business environment.

Manager

Someone who coordinates the business’s limited resources effectively and efficiently, to achieve the specific business goals.

Effective Management

The degree to which a goal has been achieved.

Efficient Management

Comparing the resources required to achieve a goal (the inputs/costs) against what was achieved (the output/benefits).

Skill

The ability that comes from the knowledge, practice, and talent to complete a task effectively.

FAD PVC SIR

Flexibility, Adaptability to change, Decision-making, Problem-solving, Vision, Communication, Strategic thinking, Interpersonal skills, Reconciling conflicting interests of stakeholders

Flexibility

The ability to anticipate and adjust to changing circumstances, and to implement a course of action that is appropriate to the current circumstances; being proactive rather than reactive.

Adaptability to Change

The ability to change and adopt new methods in response to a dynamic environment.

Decision-Making

The process of identifying the options available and then choosing a specific course of action to solve a specific problem.

Problem-Solving

A broad set of activities involved in searching for, identifying, and then implementing a course of action to correct an unworkable situation.

Vision

The clear, shared sense of direction that allows people to attain a common goal.

Communication

The exchange of information between people, involving verbal and non-verbal messages.

Strategic Thinking

Allows managers to see the business as a complex of parts that depend on each other and to take the broad long-term view, considering the business’s future direction and goals.

Interpersonal Skills

The ability to relate to people, understand their needs, and to motivate, lead, and inspire them.

Reconciling Conflicting Interests of Stakeholders

Attempting to satisfy as many stakeholders as possible, while achieving business goals, even when their interests conflict.

Planning

The preparation of a predetermined course of action for a business; the process of setting objectives and deciding on the methods to achieve them.

Organizing

The structuring of the organization to translate plans and goals into action.

Leading

The process of influencing or motivating people to work towards the achievement of the organization’s objectives.

Controlling

Compares what was intended to happen with what has occurred.

Stakeholders

Society expects businesses to accept responsibility and accountability toward all stakeholders.

Business Goals

Profit maximization, increasing market share, maximizing growth, improving share price, social goals, and environmental goals.

Profit Maximisation

Occurs when the difference between total revenue and total costs are maximized.

Market Share

The business’s share of the total industry sales for a particular product.

Growth Objective

Increasing the volume of sales that a company secures.

Share

Part ownership in a company.

Community Service

Sponsoring events, charities.

Environmental Sustainability

Producing goods in such a way that it does not diminish future generation's ability to produce goods themselves.

Classical Approach

Management as planning, organizing and controlling, hierarchical organizational structure, and autocratic leadership style.

Behavioral Approach

Management as leading, motivating, and communicating through teams and a participative/democratic leadership style.

Contingency Approach

Adapting to changing circumstances.

Hierarchical Organization Structure

Pyramid-shaped organization structure with division of labor.

Division of Labor

Involves dividing complex tasks into smaller tasks done by multiple individuals.

Autocratic Leadership Style

One who makes decisions and tells employees what tasks to do and how to do them.

Participative/Democratic Management Style

Presents problems, asks for suggestions, and works together to make a decision.

Behavioral Management Approach

Emphasizes human needs, motivation, and communication, influenced by Hawthorne studies.

Intrinsic Motivation

Internal drive to act, like purpose.

Extrinsic Motivation

External rewards, like bonuses.

Contingency Approach

Recognizes the business environment is constantly changing, requiring flexibility and adaptation.

Autocratic Management Style

Managers make most decisions with low levels of trust in workers and little opportunity for initiative.

Democratic Management Style

Decision-making that is consultative, encouraging ideas and suggestions with two-way communication.

Laissez-Faire Management Style

Workers function within broad guidelines, with the group arriving at decisions and no specific guidance provided.

Strategies

Series of actions to meet goals.

Operations Manager Role

Improve production processes and design efficient layouts.

Marketing Manager Role

Identify target markets and decide pricing, features, promotion, and distribution strategies.

Finance Manager Role

Manage financial needs, budgeting, and financial records.

Human Resources Manager Role

Recruit, train, manage contracts, and handle staff departures.

Interdependence

Mutual reliance between functions.

Contingency Approach

Stresses the need for flexibility and adaptation of management practices to suit changing circumstances.

Marketing

Total system of interacting activities designed to plan, price, promote, and distribute products to present and potential customers.

Operations

Business processes that involve the transformation of inputs into outputs.

Finance

Planning and monitoring of a business’ financial resources to enable the business to achieve its financial objectives.

Human Resources

Management of the total relationship between employer and employee, including hiring, training, and separation.

Manufacturing Businesses

Produce goods that are tangible and can be stored with little customer involvement in production.

Service Businesses

Produce services that are intangible, cannot be stored, and involve customer participation.

Inputs

Resources used in the transformation process.

Transformed Resources

Inputs that are changed in the operations process, such as materials and information.

Transforming Resources

Inputs that carry out the transformation process, such as human resources and facilities.

Transformation Process

The conversion of inputs into outputs.

Outputs

Good or service delivered to the customer.

Quality

Degree of excellence of goods and services and their fitness for a stated purpose.

Quality Management

Strategy a business uses to ensure that its product meets customer expectations.

Quality Control

Use of inspections at various points in the production process.

Quality Assurance

Use of a system so a business achieves set standards in production.

Total Quality Management

Commitment to excellence that emphasizes continuous improvement in all aspects of a business’ operations.

Target market

A group of customers with similar characteristics who presently, or who may in the future, purchase the product.

Mass Market

The seller mass-produces, mass distributes, and mass promotes one product to all buyers.

Market Segmentation

Occurs when the total market is subdivided into groups of people who share one or more common characteristic.

Niche Market

A narrowly selected target market segment; a segment within a segment.

Primary target market

Market segment at which most of the marketing resources are directed.

Secondary target market

A smaller and less important market segment

Brand

Name, term, symbol or design that identifies a specific product and distinguishes it from competitors.

Logo

graphic representation that identifies a business or product

Packaging

Development of a container and the graphic design for a product.

3 types of pricing methods

Cost-based pricing, market-based pricing, and competition-based pricing.

Promotion

Methods used to inform, persuade, and remind a market about its products.

Advertising

Paid, non-personal message communicated through a mass medium.

Sales promotions

Use of activities or materials as direct inducements to customers.

Personal Selling

Activities of a sales representative directed to a customer in an attempt to make a sale.

Distribution channels

Ways of getting the product to the customer.

People

Interaction between the customer and those within the business who deliver the service.

Processes

The flow of activities that a business will follow in its delivery of a product.

Physical evidence

Everything that the customer sees when interacting with a business, including the physical state of the premises.

Accounting

A managerial and administrative tool for recording financial transactions.

Financial Management

The planning and monitoring of a business’s financial resources to enable the business to achieve its financial objectives.

Balance sheet

Represents a business’s assets and liabilities at a particular point in time.

Assets

Items of value owned by the business.

Current assets

Assets that a business can expect to use up or turn over in 12 months.

Non-current assets

Assets that have an expected life longer than 12 months.

Liability

Items of debt owed to outside parties.

Current liabilities

Short-term debts (less than 12 months).

Non current liabilities

Long-term debt (more than 12 months).

Owner’s equity

funds contributed by the owner(s) and represents the net worth of the business

Debt finance

Use of someone else’s funds, such as a loan.

Equity finance

The use of owner’s funds or using reinvested profit.

Income Statement

Summary of income earned and expenses incurred over a period of trading.

Cash Flow statement

Cash transactions only, indicating the movement of cash into and out of a business.

Human resources management

The effective management of the formal relationship between employers and employees.

Acquisition

Process of attracting and recruiting the right staff for the roles in the business.

Job analysis

A systematic study of each employee’s duties, tasks, and work environment.

Job description

A written statement describing the employee’s duties, tasks, and responsibilities.