Bus1201 Exam 1 Dr.Lail Baylor

Business

Organized group of people imvolved in professional, commercial, or industrial activities

What does a Business do

Earns a profit

Starts with an idea

Must generate what we refer to as value in business

What are the 3 legal types of businesses

For Profit

Non Profit

Government

For profit

Focused on gaining a financial benefit

Non Profit

Aim at pursuing a charitable, religious, artistic, educational, scientific, or literary purpose

Government

Legal entities who act on behalf of the country's government while providing commerical activities

Small Business

No more than 1500 Employees

Revenues based on Industry

Medium Business

1500-2000 Employees

revenue between $10 million and $1 Billion

Large Enterprise

Over 2000 employees

Annual Revenue are over 1 billion

3 Types of Businesses

Retail

Services

Manufacturing

3 Types of businesses based on their primary function

Franchising

Distribution

Multilevel and Network Marketing

Franchising

Focuses on expanding a business by licensing to others by selling a franchise

Distribution

The activity of delivering more products and services usuall y from manufacturer to the consumer. A company who moves the products and services is part of the distrbution channel

Multilevel and Networking Marketing

Companies recruit people as distributors and generate sales and recruit people by selling the opportunity to make money

netowrk marketing

hiring or recruiting new individuals that will become part of ones network while selling without a hierachy

Industry

The setting where bussinesses conduct their operations and generate value

Group of businesses that are classified together based on their primary businesses activities

North American industry Classification System (NAICS)

Used by federal statistical agencies to classify businesses to collect, analyze, and publish statistical data about the US economy

Standard Industrial Classification code (SIC)

Assigned by the US Government

Each Business has a primary SIC code- the main line of business as it is based on the code definition that produces the most revenue for the business

5 Legal Structures

Sole Proprietorship

Cooperaties

Partnership

Corporations

Limited Liability

Sole Proprietorship Default Structure

Easy setup, Low cost

Advantagous tax deductions

Easy exit

Sole Proprietorship Challeneges

Not a separate entity

Owner pays self-income tax

Harder to raise captial

Examples of Sole Proprietorships

Single Person art or photography studio

Small local grocery store

An information technology service

A bookkeeping business and home healthcare services

Partnership

Association where two or more individuals join a legal agreement to form a business for profit

Partners become co-owners

Two types of partnerships

Limited Partnership

Limited Liability Partnership

Limited Partnership

Some partners have personal liability while the rest are limited

Incentivizes limited partners to invest without personal liability

Limited Liability Partnerships

Limited liability to every owner

Partners are not responsible for the actions of the other partners

Limited Liability Company

Permits owners, partners, and shareholders to form a business while protecting their personal assets

Examples: Ebay Sony Nike Coke

Corporations

Separates the company from its owners

People owning stocks become shareholders

Corporations are required to hold formal shareholder meetings

Corporation governance includes a board of directors, officers, and shareholders

Types of Corporations

C Corporation

S Corporation

B Corporation

C Corporations

Unlimited investors

They are taxed as separate entities

Subject to double taxation

S Corporations

Smaller Corp (up to 100 shareholders)

NO double taxation-shareholders pay taxes

Less management flexibility

B Corporations

Benefit Corporations balance profit and purpose

Legally Bound to consider how decisions impact customers, workers, suppliers, community, and environment

Example: Ben and Jerry's

Cooperatives

Focus on associating people

Owned by the very same people they serve

Owners are called members who vote on the cooperatives's mission, business course, and profit sharing

Cooperatives enjoy lower taxes as its memebers are not taxed on their income from it and can have access to additional funding via federal grants

What 4 questions does a great business model answer

Who is the customer?

What does the customer value?

How do we make money?

What is the economic logic that describes how we provide value to customers at an appropriate cost?

What are the Newer business models

Subscription Business

Bundling

Advertising supported revenue

Low Cost

Peer-to-peer

Freemium

Leasing

Crowdsourcing

Subscription Business

Consumers pay a subscription fee to enjoy a product or service

Bundling

Selling related goods and services, usually at a discount

Advertising supported revenue

Provides content for free to users while selling ads to generate revenue

Low Cost

Providing the product or service at the lowest possible cost to pass on the saving to the consumers

Peer-to-peer

Act as an intermediary to facilitate exchanges between providers of goods and services and consumers

Freemium

The basic services are offered for free and the premium or improved service for a charge

Leasing

Businesses and consumers are encouraged to rent products and services

Crowdsourcing

Businesses receive the knowledge, ideas, and work from people via a digital space, known as a crowdsourcing platform

business functions

processes and activities carried out to support operations and generate income

Business functions are interdependent of each other

Communication among functions and people is encouraged

Types of Stakeholders

Customers

Competitors

Shareholders

Government

Communities

How to be a growth-oriented leader

Embrace and encourage reasonable risk taking and innovation

believe in learning from feedback and changing course as needed

Valuing learning and determination

Resilience

The capacity to overcome adversity

Emotional Intelligence

The ability to recognize and understand emotions in yourself and others, and your ability to use this awareness to manage your behaviors and relationships

Ethics

the moral principles that regulate or control a person's behavior

Business Contracts

a legal agreement between buyer and seller of goods and services

A contract must contain?

Capacity

Offer

Acceptance

Legality

Consideration

Mutuality

Corporate Social Responsibility (CSR)

A approach businesses take to sustainably develop their operations by providing enviromental, economic, and socialm and benefits for all stakeholders

Communication

Sending information from one person, group, or place to another

Types of Communication

Verbal Communication

Nonverbal Communication

Written Communication

Visual Communication

Interpersonal Effectiveness

a person's ability to successfully communicate with others. You must develop your ability to listen, speak, and question appropriately

3 approches to Interpersonal Effectiveness

Objective effectiveness

Relationship Effectiveness

Self-respect Effectiveness

Objective Effectiveness

Paying attention to the goal when communicationg

Know what is wanted from the interaction and what needs to be done to achieve the goal

Relationship Effectiveness

Prioritize the relationship with the person(s) with whom you are trying to communicate

Self-respect Effectiveness

Put yourself as a priority

These skills can be especially important when someone is crossing a boundary or when engaging in arguments

Important to address

Important to handle with appropriate tone

Active Listening

the ability to focus exclusively on what others are communicating with all the senses

What to do to be an effective active listener

Remain neutral and avoid judgement

Turn off internal dialogue

Be comfortable with silence. Short periods of silence to allow processing

Show signs that you are listening such as making eye contact, mirroring, or leaning in

Rapport

Connecting with one another

4 types of Social Styles Matrix

Analytical

Driver

Amiable

Expressive

Assertiveness

The degree to which people have opinions about issues and make their positions clear to others

What does a elevator pitch include

A opening sentence

The body

Closing

Four Key Traits

Clear

Concise

Compelling

Convincing

The value employees bring is invaluable

They bring talents

An essential part of conducting business and reaching performance targets

The first customer of any business

wants to feel valued and appreciated

People are managed by

Human Resources (HR)

Other names: Human Capital Management, Talent Development, Human Relations, Team Member Services, People

HR Functions

Recruitment

Onboarding

Employee Development

Employee Benefits

Employee Compensation

Employee Labor and Relations

Compliance

Information and Payroll

HR function of Recruitment

Identifying where talent is needed in a business and finding the right people to fill such roles

Consists of: Job Analysis, Sourcing, Screening, and selection

HR function of Onboarding

Intergrating new employees into a business by fimilarizing them with business' policies organizational culture, and their role within the business

HR function of Employee Development

Oversees all the efforts aimed at imporving personal, teams, and organizational effectiveness to support a business' mission and goals

Also known as talent management

HR function Employee Benefits

Includes health insurance, health care flexible accounts, vacation, sick time, family leave, and retirement accounts tht a business offers to its employees

Helps attract top talent

HR functions Employee Compensation

Oversees the pay range for a job position. Every job at a business has a range, usually set by HR, from which employees get paid from

HR functions Employee Labor and Relations

Activities such as drawing contracts, overseeing details about what can be offered to candidates

Enforcement of the code of conduct, business policies

HR functions Compliance

Ensures a business meets all the applicable employment laws

HR functions Infomation and Payrolls

HR collects and analyzes information about the overall working environment

Upgrade Facilities

Necessary Equipment

Software Investment

HR oversees employees receiving their salaries, reconciles payroll data, reports labor taxes

How are resumes reviewed by HR professionals

Applicant tracking system (ATS)

Aplicant tracking system (ATS)

Helps businesses manage cndidates for hiring and recruitment purposes

What do hiring managers look for

Important Keywords

Confirmation

Exaggerations

Career Progression

Online Presence

Equity

Refers to fairness

Equality

Refers to equal rights and equal opportunities for all

Workplace Diversity

the collective mixture of differences and similarities that includes individual and organizational characteristics, values, beliefs, experiences, backgrounds, preferences, and behaviors

Inclusion

The achievement of a work environment in which all individuals are treated fairly and respectfully, have equal access to opportunities and resources, and can contribute fully to the organization's success

Diversity and inclusion bring many benefits

Increases employee satisfaction

Enriches corporate culture

Deepens employee loyalty

Enriches the understanding of different target markets and the opening of new ones

Drives innovative thinking among employees

Key Metrics when managing the HR Function

Benefit % of Salary

Salary % of Operating Expense

Health care costs per employee

Turnover rate

Cost/hire

Revenue per FTE

Employee engagement rate

Workweek FTE

Recruiting yield ratios

The company cultivates an inclusive enviroment by

Evaluating their leaders

Salesforce

This increases volunterrism and empowers employees to be citizen philanthropists

In summary the best companies to work for

Put people first

Help workers find and pursue their passions

Bring people together on a personal level,

Empower people to own their work