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Sole Trader
Business structure that is owned and operated by one individual
Partnership
Business structure that is owned by 2-20 owners
Private Limited Company
Incorporated business structure that has at least one director and a maximum of 50 shareholders
Public Listed Company
Incorporated business that has an unlimited number of shareholders and lists and sells its shares on the ASX
Social Enterprise
Type of business that aims to fulfil a community or environmental need by selling goods or services
Government Business Enterprise
Business that is owned and operated by the government.
Unlimited Liability
Personal legal responsibility a business owner has for an unincorporated business’s debts
Personal Income Tax
Portion of an individual’s earnings that is paid to the government for public services
Unincorporated
Legal status of a business whereby the business owner and the business are viewed as the same legal entity.
Incorporated
Legal status of a company whereby the company
is established as a separate legal entity to the shareholder/s.
Shareholders
Individuals or organisations who have purchased shares of a company and therefore are part-owners of the company.
Shares
Portions of an incorporated business that can be bought and sold as a means for the business to gain revenue
Dividends
Regular sums of money paid out to shareholders from a company's profit.
Company Tax
Portion of profits a company pays to the government for public services
Limited Liability
Shareholders are only liable to the extent of their original investment, meaning they are not personally responsible for the business debts
Capital
Resources that can be used for funding a business, such as cash, machinery, and equipment.
Australian Securities Exchange (ASX)
Electronic market where Australian public company shares are bought and sold.
Increase Market Share
Business’s % of total sales in an industry
Business Objectives
Goals a business intends to achieve - provides direction
Make A Profit
Businesses create more revenue than expenses
Meet Shareholder Expectations
Investment can facilitate growth/development of a business - new market opportunities
Fulfill Market Need
Fill gap in market - addressing unmet/unprecedented customer needs by other businesses in the same industry
Fulfill Social Need
Improving environment and society through business activities
Improve Efficiency
Get most out of resources
Improve Effectiveness
For a business to be competitive
Stakeholders
Individuals, groups or organisations who have a vested interest in the performance and activities of a business
Owners
Individuals who establish, invest, and have a share in a business, often with the goal of making a profit
Managers
Individuals who oversee and coordinate a business’s employees and lead its operations to ultimately achieve business objectives
Employees
Individuals hired by a business to complete work tasks and support achievement of objectives
Customers
Individuals or groups that interact with a business by purchasing and utilising goods/services
Suppliers
Individuals or groups that source raw materials, component parts and processed materials and sell them to a business to use in the production of goods/services
General Community
Individuals or groups who are impacted by a business’s operations and decisions, often located in close proximity to the business
Management Styles
Approach and manner in which employees are directed and motivated within a business
Autocratic
Involves a manager making decisions and directing employees without any input from them
Persuasive
Involves a manager making decisions and communicating the reasons for decisions to employees without their input
Consultative
Manager seeking input from employees on business decisions but making the final decisions themselves
Participative
Manager sharing information with employees (can participate in decision making)
Laissez-Faire
Manager communicating business objectives to employees and giving them freedom to make decisions independently
Appropriateness Of Management Styles
In relation to the nature of the task, time, experience of employees, manager preference
Time
Time in which decision should be made for the manager to complete a task
Experience Of Employees
Untrained and inexperiences to highly skilled and qualified experts
Nature Of Task
Can be straight-forward and simple in nature to highly complex, technical work
Managers Preference
Can be highly individualised
Planning
Process of determining a business’s objectives and establishing strategies to achieve these objectives
Decision-Making
Skill of selecting a suitable course of action from a range of plausible options
Communication
Skill of effectively transferring information from one party to another
Delegation
Skill of assigning work tasks and authority to other employees who are further down in a business’s hierarchical structure
Interpersonal Skills
Skill of creating positive interactions with other employees to foster beneficial professional relationships
Leadership
Skill of motivating others in order to achieve a business’s objectives
Relationship Between Skills And Style
Each management style requires a manager to use a different set of skills - unique balance to manage employees effectively
Corporate Culture
Shared values and beliefs of a business and its employees
Official Corporate Culture
Involves shared views and values that a business aims to achieve, often in written format
Real Corporate Culture
Shared values and beliefs that develop organically within a business, practised on a daily basis by its employees