Lecture Notes: Chapters 7-12 – Productivity, Accounting & Finance, HR, Motivation

A comprehensive set of vocabulary flashcards covering key terms in productivity, accounting & finance, human resources, and motivation from the video notes.

Productivity

A ratio that measures how much gets done relative to the inputs used to achieve it; also called efficiency.

Output

Goods or services produced.

Input

Resources used to produce outputs.

GDP per Capita

GDP divided by population.

Real GDP Per Capita

Real GDP divided by population.

Natural Resources

Resources such as clean water, fertile soil, oil, gold, natural forests, and preserved ecosystems.

Labour

A healthy, well-educated, well-trained workforce.

Capital

Tools and infrastructure like transport, communication, and finance systems.

Entrepreneurship

Entrepreneurial activity encouraged by government in Canada; starting and growing new ventures.

Information/Knowledge

Patents, scholarly journals, and global research as sources of knowledge.

Labour Productivity

GDP divided by labour hours.

Business Productivity

Quality or value produced divided by quality or value used to produce it.

Quality

Meeting or surpassing customer expectations; high quality can reduce costs.

Planned Obsolescence

Deliberate policy to limit a product’s useful life to boost short-term sales.

Profit Margin

Sales minus Cost of Goods Sold.

Data

Raw facts and figures.

Information

Structured data presented in a context to be useful.

Knowledge

Understanding from experience used to form judgments and decisions.

MIS (Management Information System)

System for collecting data and turning it into information for managers.

Accounting Information

System for collecting, analyzing, and communicating financial information.

Financial Accounting

External financial information about the overall performance and condition of the business.

Managerial Accounting

Internal-focused accounting for planning, decision making, and control.

Audit

Formal examination of an organization’s financial procedures and statements.

Balance Sheet

Financial statement showing resources owned and how capital is funded.

GAAP (Generally Accepted Accounting Principles)

A common set of accounting principles; Canada’s guidelines are issued by the profession.

Income Statement

Statement of profit and loss; revenue, costs, and expenses over a period.

Revenue (Sales)

Total income the company has made.

Cost of Goods Sold (Cost of Sales)

Cost of materials and labour to make the product.

Gross Profit

Revenue minus Cost of Sales.

Operating Expenses

Selling and general expenses; fixed costs in some analyses.

Depreciation and Amortization

Wear and tear on buildings and equipment.

Operating Income (EBIT)

Income from operating activities.

Net Income

The bottom line; Revenue minus all expenses.

Asset

Resources owned by an organization.

Liability

Money a company borrows.

Owner’s Equity

Capital contributed by owners.

Liquidity

Ease and speed with which an asset can be converted to cash.

Current Assets

Assets expected to be converted into cash within one year (e.g., cash, accounts receivable, inventory, work-in-progress, raw materials).

Fixed Assets

Long-term assets not intended for immediate sale (e.g., factory, machinery).

Current Liability

Debts due within one year.

Working Capital

Current Assets minus Current Liabilities.

Current Ratio

Current Assets divided by Current Liabilities.

Leverage

Ratio of how much a business borrows relative to owner’s equity.

Debt to Equity Ratio

Total Liabilities divided by Total Owner’s Equity.

Return on Investment (ROI)

Profit generated by a business relative to the capital invested (defined here as Net Profit divided by Owner’s Equity).

CFO (Chief Financial Officer)

Senior manager responsible for financial management of the organization.

Budget

Forecasted cost of plans and projects for the coming period.

Budget Deficit

When costs exceed inflows.

Budget Surplus

When inflows exceed costs.

Financial Planning

Planning of a company’s finances to meet objectives.

Investment

Decision to commit capital to generate future returns (new product, geographic expansion, capacity expansion, acquisitions).

Investment Appraisal

Assessment of the attractiveness of investment opportunities.

Payback Period

Time required for cash inflows to exceed initial outflow.

Risk of Return

Range of possible returns from an investment.

Capital Raising

Increasing capital via partnerships, incorporation, or issuing shares to existing or new investors.

Capital Structure

Debt and equity mix used to finance operations and growth.

Equity Financing

Capital from existing or new investors.

Dilution

Decrease in ownership percentage after new investment.

Entrepreneurship (HR context)

Independence and achievement orientation; potential resistance to shared decision making.

Debt Financing

Borrowing money to spend; does not dilute ownership but adds interest and repayment obligations.

Investor Relations

Communicating a company’s financial results and strategy to stakeholders.

Financial Control

Standards, measurement, and actions to manage capital raising and spending.

Financial Ratios

Tools to assess financial health; includes profitability, efficiency, liquidity, and leverage ratios.

Profitability Ratios

Examples: Gross Profit Margin and Net Income Margin.

Efficiency Ratios

Examples: Asset Turnover, Inventory Turnover, Receivables Turnover, Accounts Payable Turnover.

Liquidity Ratios

Examples: Current Ratio, Quick Ratio, Working Capital.

Financial Leverage

Use of debt to enhance returns.

Probability of ROI (Investment)

ROI = Net Profits / Equity.

HRM (Human Resource Management)

Activities involved in planning, organizing, leading, and controlling a business’ people.

Recruiting

Attracting applicants to fill a position.

Job Analysis

Breakdown of the mental and physical tasks involved in a job.

Job Specification

Knowledge, education, experience, and characteristics essential for the job.

Job Description

Environment and culture of the job within the organization.

Job Advertisement

Information from Job Analysis and Job Specification used to attract candidates.

Head Hunters/Recruitment Agencies

Intermediaries that locate prospective candidates for vacancies.

Internal Recruiting

Filling vacancies from within the organization; benefits include time/cost savings and morale.

Screening

Sifting through applications to create a shorter list of suitable candidates.

Resume

Summary of an individual’s skills, education, and experience.

Cover Letter (CV)

Detailed portrayal of skills, accomplishments, education, and experience.

Soft Skills

Interpersonal traits such as manners, social graces, confidence.

Employment Equity Act

Requires equal employment opportunities for four groups (women, aboriginal peoples, persons with disabilities, visible minorities).

Canadian Human Rights Act

Prohibits discrimination on grounds such as race, religion, sex, etc., including in job applications.

Selection

Process of choosing the right person for the job.

Compensation

All forms of reward given to employees.

Minimum Wage

Lowest hourly wage that must be paid by law.

Gain Sharing

Sharing profits with employees for improvements they initiate.

Sales Commission

Reward paid to salespeople based on revenue generated.

Employee Benefits

Non-financial forms of compensation in addition to salary.

Orientation/Induction

Process of introducing new employees to the organization.

Management by Objectives

Theory that performance improves when managers and employees set mutually agreed objectives.

Performance Appraisal

Evaluation of an employee’s achievements and growth.

Training

Activities to increase an employee’s job-specific skills.

Employee Development

Activities to increase general skills, knowledge, and planning for career growth.

Mentoring

Guidance from a senior manager to a junior employee.

Retention

Activities to keep and manage personnel.

Absenteeism

Employee absences due to illness or personal/family responsibilities.

Motivation

Internal process that energizes and directs behavior.

Intrinsic Reward

Good feeling from doing a job well.

Extrinsic Reward

Rewards from others (pay, praise, promotions) for good work.

Classical Theory of Motivation

Motivation driven primarily by money.