ETDM DECA Performance Indicators

Describe methods used to protect intellectual property.

(BL:051)

Patents - applies to designs, inventions, etc.

Trademarks - applies to words, phrases, symbols/logos, etc.

Trade secrets - applies to private information, practices, techniques, etc., that are not publicly known

Copyright - the right to copy or reproduce a product

Describe legal issues affecting businesses.

(BL:001)

Wrong Termination Lawsuits - the former employee sues if (s)he believes (s)he was unjustly fired

Harassment/Discrimination Cases - employee/customer was harassed or treated inferiorly due to demographic differences

Immigration Audits - requirement of businesses to file Form 1-9 in order to verify employee eligibility

IP Issues - disputes over ownership of trademarkes, copyrights, and/or patents

Dissatisfied Customer s - consumers feel misled or deceived

Identify the basic torts relating to business enterprises.

(BL:069)

A business tort is a civic wrong committed against an organization that results in harm to its assets.

Types of Torts:

Intentional Torts - occurs when an individual/entity purposefully engages in conduct that harms another party.

Negligence - occurs when an individual/entity is careless and fails to provide a duty owed to another person. These torts are unintentional, but still result in harm.

Strict Liability - occurs in cases where responsibility for an injury can be imposed on the wrongdoer without proof of negligence or direct fault.

Describe the nature of legally binding contracts.

(BL:002)

A contract is an agreement between two or more parties to do, or refrain from doing, a certain action.

Components of a contract:

Offer - one party must make a clearly stated offer to another party

Acceptance - the offer must be accepted by the other party/parties

Consideration - something of value must be promised in echange for a specific action or non-action

Explain the nature of human resources regulations.

(BL:007)

Human resources regulations exist to provide a safeguard for employees so that they are getting the rights and treatment that they deserve.

Explain the nature of workplace regulations (including OSHA, ADA).

(BL:008)

The nature of workplace regulations are to provide consistency to the structure and guidelines of a company, and to make sure that both the company and its employees are protected against lawsuits.

Explain types of business ownership.

(BL:003)

Sole proprietorship - business is owned/run by one individual who receives all profits and is responsible for all loss or debt

Partnership - business is owned/run by two or more parties who agree to divide the profits, contribute resources, and share liability

Corporation - business is owned/run by multiple shareholders and often sells shares on the stock market. Allows for limited liability.

Limited Liability Company (LLC) - business is owned/run by multiple members (not shareholders) that are not personally liable for the company's losses or debts. Considered a hybrid between corporations and sole proprietorships.

Select form of business ownership.

(BL:006)

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Explain the nature of tax regulations on business.

(BL:009)

The nature of tax regulations, or treasury regulations, on businesses are to pick up where the tax laws leave off.

Explain the nature of businesses' reporting requirements.

(BL:010)

Businesses' reporting requirements are meant to make sure that investors and regulators can evaluate a company's financial performance and business operations. Additionally, access to these reports are necessary for company transparency.

Develop strategies for legal/government compliance.

(BL:011)

Establish, evaluate, study, authorize, train, involve, ensure.

Prepare complex written reports.

(CO:009)

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Write proposals.

(CO:062)

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Explain management's role in customer relations.

(CR:008)

Lead and motivate the team to ensure they're giving the best customer service possible, handle complaints and queries, and sort security issues.

Identify company's brand promise.

(CR:001)

Determine the company's goals and make educated business decisions by planning a strategic direction, marketing to the right people, and attracting the right employees.

Identify the impact of small business/entrepreneurship on market economies.

(EC:065)

Statistics have consistently shown that the creation of new businesses drives economic prosperity. It increases the competition of emerging sectors and inspires innovation. Small businesses are critical for economic growth and innovative capacity in many regions. Additionally, they add to job creation, economic growth, and poverty reduction.

Explain the concept of private enterprise.

(EC:009)

Private enterprises are businesses carried on for profit and not owned by government. The system discourages public ownership of business. This is the same as a free enterprise.

Identify factors affecting a business' profit.

(EC:010)

Sales Changes - changes in sales costs are affected by certain external factors (economic health, market stability, natural factors, etc.) and certain internal factors (marketing efforts, pricing, and available payment options)

Material Price Changes - changes in material pricing are often affected by certain external factors (political unrest, natural disasters, global supply issues)

Labor Price Changes - changes in labor pricing are often affected by factors such as insurance changes and the effectiveness of a company's human resource management.

Inventory Method Changes - inventory methods include FIFO (First-In, First-Out), LIFO (Last-In, Last-Out) and average cost

Determine factors affecting business risk.

(EC:011)

Internal Factors - pricing, employees, vendors, technological factors, physical equipment malfunctions, etc.

External Factors - economy, natural causes, political factors, etc.

Explain the concept of competition.

(EC:012)

Competition is the rivalry between companies selling similar products and services. It motivates companies to increase sales volume by utilizing the four components of marketing mix (price, product, promotion, place).

Determine the relationship between government and business.

(EC:008)

In a planned economy or market economy, the government controls the shaping of business activities in the country. Most countries allow for a large degree of private businesses while maintaining a strict regulation of certain aspects of the economy through legislative laws. Today's relationship between government and business is mainly a mixed economy (combines private and public enterprise).

Describe the nature of taxes.

(EC:072)

Taxes benefit the society and are used as instuments for attaining certain social objectives. Governments use taxes to either speed or slow economic growth.

Describe the concept of economies of scale.

(EC:077)

Economies of scale refer to reduced costs per unit that arise from increased total output of a product.

Exhibit cultural sensitivity.

(EI:033)

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Leverage personality types in business situations.

(EI:104)

Introverts - prefer to have time to think about their ideas, and generally need solitude and time to recharge after socializing. They can run out of energy quickly when put in group situations for too long.

Extroverts - prefer to generate ideas in a group setting and feel most energized during back and forth communication. They easily become bored when they cannot actively participate in a conversation.

Adapt management style to the personality type of others.

(EI:105)

Identify the strengths and weaknesses, as wel as needs and wants, of each personality type in business.

"Sell" ideas to others.

(EI:108)

Use persuasive language, good arguments, and focus on closing the deal.

Persuade others.

(EI:012)

Use persuasive language, pay attention to what the individual wants or needs, be personal.

Demonstrate negotiation skills.

(EI:062)

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Encourage team building.

(EI:044)

Use the 9 C's:

- Clear expectations

- Context

- Commitment

- Control

- Collaboration

- Communication

- Consequences

- Coordination

- Culture change

Explain the concept of leadership.

(EI:009)

A good leader aims to establish goals, values, and concepts that make up the organization's personality or how the organization is observes by both outsiders and insiders.

Types of Leadership:

Authoritarian - strictly professional, direct supervision

Paternalistic - father figure, more personal

Democratic - social equality

Laissez Faire - workers have all the power

Transactional - system of rewards and punishments

Transformational - leads change and initiative

Determine personal vision.

(EI:063)

Personal vision is determined through goals.

Demonstrate adaptability.

(EI:006)

Adaptability is the ability to change with market or industry trends, and adjust goals and visions off of market predictions.

Develop an acheivement orientation.

(EI:027)

Acheivement orientation refers to how an individual interprets or reacts to tasks, resulting in different patterns of cognition, effect, and behavior. It refers to an individual's ability to set measurable self-improvement goals.

Enlist others in working towards a shared vision.

(EI:060)

Set the goal and then establish steps to work towards it. Be sure to communicate and motivate your team.

Act as a role model to fulfill the organization's standards/values.

(EI:111)

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Recognize/reward others for their efforts and contributions.

(EI:014)

Make it personal and magnify recognition, and provide opportunities for people to be rewarded. Facilitate peer-to-peer recognition and motivate through financial incentives.

Determine stakeholder expectations.

(EI:113)

Identify the stakeholders and the preferred mode of communication, and make sure you have accurately mapped expectations so that they are engaged throughout the process. Classify the level of communication for each stakeholder and identify which stakeholders will be advocates. Engage the stakeholders in decision making processes, and make sure that the manner in which the project is accomplished is positive even if problems arise.

Establish strategic relationships with others.

(EI:114)

A strategic relationship is a relationship between two commercial enterprises, usually formalized by one or more business contracts. They usually fall short of a legal partnership entity, agency, or corporate affiliate relationship.

Share best practices with key individuals and groups.

(EI:115)

Best practices are practices determined to be effective and practicable for business operations.

Leverage business relationships.

(EI:116)

Keep selling to clients, talk on a regular basis, send them messages, ask for introductions, and take initiative.

Describe the nature of entrepreneurship.

(EN:039)

Entrepreneurship is the development of a business from the ground up. This includes coming up with the idea and the process of turning it into a profitable business.

Discuss entrepreneurial discovery processes.

(EN:002)

The process for entrepreneurial discovery is a learning process. It is a vision about opportunities in existing or emerging sectors, and the process of bringing that idea into reality.

Assess global trends and opportunities for business ventures.

(EN:003)

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Determine opportunities for venture creation.

(EN:004)

Understand the opportunity space around an idea, and find an idea in an attractive and fast growing opportunity space.

Assess opportunities for venture creation.

(EN:005)

SWOT Analysis - a compilation of your company's strengths, weaknesses, opportunities, and threats

Ansoff Matrix - a grid used to analyze and plan strategies (market penetration, product development, market development, diversification) for a business based on new and existing products/markets, as well as the risk factors associated with them

Pricing Matrix - when businesses define their costs, features, and what differentiates them from their competition, which (if done well) can motivate a new customer to purchase

Boston Matrix - a model that helps businesses analyze their portfolio of products using the basis of their relative market shares and growth rates to help with long-term strategic planning

Generate venture ideas.

(EN:006)

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Determine feasibility of venture ideas.

(EN:038)

TMMD Analysis:

Time - evaluate the time it will take to successfully set up a working business

Money - evaluate the costs, set a budget range, and plan accordingly

Market - evaluate the state of the market, the success of the competition, and any opportunities that could lead to profit

Determination - determine if the venture is worth the risk

Describe entrepreneurial planning considerations.

(EN:007)

Identify a real opportunity, create a plan to address that opportunity, determine the feasibility of the idea, forecast the future of the business, find funding, market the idea

Explain tools used by entrepreneurs for venture planning.

(EN:008)

PEST Analysis - helps entrepreneurs make better business decisions and improving efficiency by studying various factors (political, economic, social, technological) that might influence the business

SWOT Analysis - helps raise the organization's awareness of all the risks and factors involved in the making of their business by analyzing their strengths, weaknesses, opportunities, and threats

McKinsey 7s Framework - used to determine a business' organizational effectiveness by analyzing the business' strategy, structure, system, style, shared values, staff and skills

Assess start-up requirements.

(EN:009)

Select a Legal Structure - sole proprietorship, partnership, corporation, LLC

Obtain a Federal Employer Identification Number - apply for a FEIN from the IRS based on the legal structure of the business

Open a Company Bank Account - select a bank and open a company bank account

Lease or Buy an Office, Warehouse, or Retail Space - depending on the type of business, arrange for an office space to be leased

Obtain Licenses and Permits - depending on the industry, a business may need a federal permit, state license, sales tax permit, or business license

Hire Employees - if a business intends to hire employees, they must register with the appropriate state agencies

Set Up an Accounting and Record Keeping System - learn about the taxes the company is responsible for paying and keep a strict record-keeping system (company documents are generally required to be kept for three years)

Assess risks associated with venture.

(EN:010)

Market Timing Risk - determine whether it is the right time to start such a business

Market Adoption Risk - determine whether there are currently strong competitors in the business, and evaluate any major barriers to entry

Market Size Risk - if the company is successful, consider whether the exit scenario is large enough to provide the types of returns for the business' fund needs

Execution Risk - evaluate whether the business has what it takes to fully execute the business plan and acheive the goal

Technology Risk - if the company has to develop new technology that may not reach fruition, evaluate the risk of the development taking longer than expected

Business Model Risk - determine whether the business has a clear business model, and whether the unit economics work out

Platform Risk - determine how strong the relationship between the startup and the platform, and whether their product plans are complementary

Venture Leadership Risk - determine whether the company is receptive to feedback, and if the management team is fit for leadership

Financial Risk - determine the amount of money required for the company to acheive its goals, and whether the financial risk is manageable given the current environment and company trajectory

Legal Risk - determine whether the business has a high likelihood of lawsuit for patent/copyright infringement

Describe external resources useful to entrepreneurs during concept development.

(EN:011)

Indirect Research - looking at trends of similar products, reviews, success by past comparison

Direct Research - speaking to/questioning markets for their experiences in the past (correlate to case)

Assess the need to use external resources for concept development.

(EN:012)

...

Describe strategies to protect intellectual property.

(EN:013)

Externally:

Patents - protects designs, inventions, etc.

Trademarks - protects distinguishing logos or designs

Trade Secrets - protects formulas, algoritms, processes, etc.

Copyrights - protects the original works and the right to reproduce or copy such products

Internally:

Non-disclosure Agreements - contract between one or more parties that states that neither will disclose confidential information

Confidential Information - educate all tem members and employees on confidential information

Attourney - hire an attourney in case of legal conflict

Use components of a business plan to define venture idea.

(EN:014)

- product/service team

- management team

- marketing plan

- operational plan

- organizational plan

- financial plan

- industry/market analysis

- growth plan

Describe processes used to acquire adequate financial resources for venture creation/start-up.

(EN:015)

Networking, finding public sector contract possibilities, writing RFP's or requests for proposals, eliciting bids and accepting/networking with potential investors.

Select sources to finance venture creation/start-up.

(EN:016)

Personal Investment - entrepreneur invests cash or personal assets as collateral to secure financing

Personal Connections - entrepreneurs rely on "love money," or capital borrowed from friends and family (usually family and friends don't mind waiting to be repaid until profits start rolling in, but it can be challenging to mix business with personal relationships)

Debt Financing - lenders offer various types of debt financing, including term loans and lines of credit

Outside Equity Financing - businesses with high growth potential may be able to secure start-up money from angel investors, business incubators or venture capital funds, usually in exchange for an equity position in the company

Grants and Subsidies - some companies may be eligible for government grands and subsidies to help with start-up costs

Explain factors to consider in determining a venture's human-resources needs.

(EN:017)

...

Explain considerations in making the decision to hire staff.

(EN:018)

Review the Positions - determine the requirements and eligibilities

Look for workers with related skills and experience, strong work mindset, teamwork-oriented, strong communication skills, etc.

Describe considerations in selecting capital resources.

(EN:019)

Capital resources can be defined as resources that can be used for production (tools, machines, factories, etc.).

Consider a resource's productivity, affordability, ease of access, and sustainability in the selection process.

Identify capital resources needed for the venture.

(EN:020)

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Assess the costs/benefits associated with resources.

(EN:021)

...

Use external resources to supplement entrepreneur's expertise.

(EN:022)

Find people who can fill in for the entrepreneur's lack in expertise (e.g production facilities, manufacturers)

Explain the complexity of business operations.

(EN:023)

Business operations refer to the condition of having several interdependent and interconnected stakeholders, information technology systems, and organizational structures.

(e.g stakeholders, infrastructures, tech, etc.)

Evaluate risk-taking opportunities.

(EN:024)

Risk assessment is the process of identifying every risk of loss associated with a new project or business venture, and then comparing each potential loss against the potential benefit/profit of the whole project.

Explain the need for business systems and procedures.

(EN:025)

Implementing a business system helps improve performance, meet customer expectations, produce consistent results, and engage and educate employees. A systematic approach also allows your organization to receive constant information on areas that need to be improved.

Describe the use of operating procedures.

(EN:026)

A standard operating procedure is a set of step-by-step instructions compiled by an organization to help worker carry out complex routine operations. They provide the baseline and make sure that all regulations are met.

Explain methods/processes for organizing workflow.

(EN:027)

- Identify the ultimate outcome

- Create a series of steps involved to reach the outcome

- Identify the order that each task needs to occur in

- Assigning tasks to a person, if necessary (some tasks may be automated)

- Setting a duration for each task and step

Develop and/or provide product/service.

(EN:028)

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Use creative problem-solving in business activities and decisions.

(EN:029)

Identify and define the problem, look at potential causes for the problem, identify alternatives for approaches to resolve the problem, select an approach to resolve the problem, plan the implementation of the best alternative, monitor the implementation of the plan, verify if the problem has been resolved or not.

Explain the impact of resource productivity on venture success.

(EN:030)

If resource productivity is high, then there is a higher chance of venture success. If the productivity is low, the chance for success decreases accordingly.

Create processes for ongoing opportunity recognition.

(EN:031)

Discover opportunities - entrepreneurs discover opportunities when they search for them in existing markets by observing technological, economic or social trends.

Create opportunities - entrepreneurs create opportunities when they engage with others in bouncing ideas back and forth, where each time it becomes more specific what the user needs are and how they are going to be satisfied.

Develop plan to invest resources into improving current products or creating new ones.

(EN:032)

Product Lifecycle - pay attention to the lifecycle of a product, as it is essential to your profitability. The five stages of a product's life consist of development (idea), introduction (product launch), growth (product is gradually making a profit and establishing itself), maturity (sales growth begins to slow), decline (new and improved products cause competition and lead to a decline in sales). You can extend the lifecycle of your product/service by investing in an "extension strategy," in which you can increase your promotional spending, introduce minor innovations, and seek new markets.

Developing Ideas - produce a plan for the development of a good product. Consider whether your product meets customers' specifications, how technologically feasible it is, and whether the product will satisfy your goals and meet customer expectations.

Match Market Needs - market research is key to the success of new products and services. Pay attention to how customer needs are currently met, why your customers would choose your product/service rather than your competition's, and what risks you are prepared to take to launch your product on the market.

Pricing - establishing a pricing strategy is incredibly important to the success of a product or service. Take into account what your product will have to offer to the customers, whether you're the first on the product or if you already have competition, which selling channels you plan to use, and whether you are covering your costs.

Adapt to changes in business environment.

(EN:033)

Pay attention to internal vs. external environment, and identify any changes, before establishing a solution to adapt to it.

Explain the need for continuation planning.

(EN:034)

Business Continuation Planning (BCP) - plans measures and arrangements, and identifies resources.

BCPs are applicable in cases of accidents, disruptions, resource failures/depletions, cyber attacks, etc., and allow for better efficiency.

Describe methods of venture harvesting.

(EN:035)

Harvesting is the final phase in the entrepreneurial value creation process, which includes building, growing, and harvesting. Harvesting is the process entrepreneurs and incestors use to exit a business and liquidate their investment in a firm.

Evaluate options for continued venture involvement.

(EN:036)

...

Develop exit strategies.

(EN:037)

Merger acquisition - merge company with another company (or being bought by a larger company)

IPO - allow shareholders to take control, while extracting the monetary worth of your company (both this and merger acquisitions are better than liquidation, as they sell at a higher cost)

Selling - company is passed on or sold to select individuals

Liquidation - the full liquidation of a company sells the company at a depreciated face value

Obtain insurance coverage.

(FI:082)

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Explain the concept of accounting.

(FI:085)

The goal of accounting is to understand the business finances, and to know the revenues and costs in order to properly address them.

Explain the nature of balance sheets.

(FI:093)

The purpose of balance sheets are to clearly lay out the statement of assets, liabilities, and capital of a business.

Describe the nature of income statements.

(FI:094)

An income statement is a financial statement that reports a company's financial performance over a specific accounting period.

Prepare cash flow statements.

(FI:092)

Cash Flow From Operating Activities - records a company's operating cash movement

Cash Flow From Investing Activities - records change in cash from purchase or sale of property, plants, equipment, or from general long-term investments

Cash Flow From Financial Activities - reports cash level changes from the purchase of a company's own stock or issue of bonds and payments of interest and dividends to shareholders

Explain the purposes and importance of obtaining business credit.

(FI:023)

The purpose of obtaining business credit is to secure lines of credit, lease equipment, finance a company vehivle, and obtain business loans and credit cards without putting personal credit at risk. This is important because it gives unique financial advantages in the market place.

Analyze critical banking relationships.

(FI:039)

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Make critical decisions regarding acceptance of bank cards.

(FI:040)

Bank cards are plastic cards issued by banks enabling customers to withdraw money at an automated teller machine. This can be anything from an ATM card to a debit card.

Determine financing needed for business operations.

(FI:043)

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(See EN:016)

Identify risks associated with obtaining business credit.

(EN:041)

Personal Liability - if the business fails and is unable to pay its debts, the owner will likely be personally liable for any charges made on their card

Credit Bureau Reporting - once a business defaults to a business credit card, most credit card issuers will report the balance and derogatory information on the credit card, causing the owner's credit score to drop dramatically. Additionally, if the owner's debt is unpaid, it will likely be passed along to a collection agency

CARD Act Protections Are Limited - small business credit cards did not benefit from the CARD Act's protection, the most prominent protection being risk-based repricing (a practice where a bank could increase the interest rate on existing balances if the borrower appeared riskier)

Still Liable For Employee Cards (In Some Circumstances) - if a small business adds an employee to the existing business account, they are effectively creating an authorized user. While the same credit limit will be used, the liability still remains with the owner of the account

APRs Are Not Low - if a business chooses to pay the balance over time, the interest rates (APRs) on business cards nare not low

Explain sources of financial assistance.

(FI:031)

Government grants, crowdfunding, investors, bank loans, personal financing, stocks/shareholders.

Explain loan evaluation criteria used by lending institutions.

(FI:031)

...

Complete loan application package.

(FI:033)

Personal/joint financial statement, personal/household monthly living expenses form, business information and debt, signed and dated version of the original and final form 1003.

Describe the nature of cost/benefit analysis.

(FI:357)

Cost/benefit analysis is the process of analyzing the costs of a decision vs. the benefits that would be derived.

Determine relationships among total revenue, marginal revenue, output, and profit.

(FI:358)

Output - the quantity of goods or services produced in a given amount of time

Profit - the financial benefit realized when revenue generated from business activity exceeds expenses, costs, and taxes

Total Revenue - the full amount of total sales of goods and services. It is calculated by multiplying the total amount of goods and services sold by their prices

Marginal Revenue - the increase in revenue from selling one additional unit of a good or service

(Marginal revenue is directly related to total revenue because it measures the increase in total revenue from selling a single additional unit of a good or service)

Develop company's/department's budget.

(FI:099)

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Forecast sales.

(FI:096)

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Calculate financial ratios.

(FI:097)

Current Ratio - measures a company's ability to pay off short-term liabilities with current assets

(current ratio = current assets/ current liabilities)

Acid-Test Ratio - measures a company's ability to pay off short term liabilities with quick assets

(acid-test ratio = current assets - inventories / current liabilities)

Cash Ratio - measures a company's ability to pay off short-term liabilities with cash and cash equivalents

(cash ratio = cash + cash equivalents / current liabilities)

Operating Cash Flow Ratio - measures the number of times a company can pay off current liabilities with the cash generated in a given period

(operating cash flow ratio = operating cash flow / current liabilities)

Debt Ratio - measures the relative amount of a company's assets that are provided from debt

(debt ratio = total liabilities / total assets)

Debt to Equity Ratio - calculates the weight of total debt and financial liabilities against shareholders' equity

(debt to equity ratio = total liabilities / shareholder's equity)

Interest Coverage Ratio - shows how easily a company can pay its interest expenses

(interest coverage ratio = operating income / interest expenses)

Debt Service Coverage Ratio - reveals how easily a company can pay its debt obligations

(debt service coverage ratio = operating income / total debt service)

Asset Turnover Ratio - measures a company's ability ot generate sales form assets

(asset turnover ratio = net sales / average total assets)

Inventory Turnover Ratio - measures how many times a company's inventory is sold and replaced over a given period

(inventory turnover ratio = cost of goods sold / average inventory)

Gross Margin Ratio - compares the gross rofit of a company to its net sales to show how much profit a company makes after paying its cost of goods sold

(gross margin ratio = gross profit / net sales)

Operating Margin Ratio - compares the operating income of a company to its net sales to determine operating efficiency

(operating margin ratio = operating income / net sales)

Earnings Per Share Ratio - measures the amoutn of net income earned for each share outstanding

(earnings per share ratio = net earnings / total shares outstanding)

Price-earnings Ratio - compares a comany's share price to its earnings per share

(price-earnings ratio = share price / earnings per share)

Interpret financial statements.

(FI:102)

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File business tax returns.

(FI:652)

Collect records, find the right form, fill out the form, pay attention to deadlines

Verify the accuracy of business financial records.

(FI:653)

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