HSC Business Studies

absenteeism

refers to a worker who neglects to turn up for work when they were scheduled to do so.

advertising

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

acquisition

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

assets

items of value owned by the business. Current assets can be turned into cash within 12 months, whereas non-current assets are not expected to be turned into cash within 12 months.

awards

legally enforceable, formal agreements made collectively between employers and employees and their representatives at the industry level. They are determined by an industrial court or tribunal and set out minimum wages and conditions of employees.

balance sheet

represents a business's assets and liabilities at a particular point in time, expressed in money terms, and represents the net worth of the business.

budgets

provide information in quantitative terms (facts and figures) about requirements to achieve a particular purpose.

cash flow

the movement of cash in and out of a business over a period of time.

consumer markets

individuals — that is, members of a household — who plan to use or consume the products they buy.

controlling

the comparison of planned performance against actual performance and taking corrective action to make sure the objectives are attained.

corporate social responsibility

open and accountable business actions based on respect for people, community/society and the broader environment. It involves businesses doing more than just complying with the laws and regulations.

cost centres

particular areas, departments or sections of a business to which costs can be directly attributed.

current assets

assets that a business can expect to convert into cash within 12 months. They usually include cash and accounts receivable.

current liabilities

liabilities that a business must repay within the short term. They usually include overdraft and accounts payable.

customisation

creation of individualised products to meet the specific needs of the customers.

debentures

issued by a company for a fixed rate of interest and for a fixed period of time.

debt finance

the short-term and long-term borrowing from external sources by a business.

discrimination

when a policy or a practice disadvantages a person or a group of people because of a personal characteristic that is irrelevant to the performance of the work.

economies of scale

cost advantages that can be created as a result of an increase in scale of business operations. Typically the cost savings come from being able to purchase lower cost per unit of input and from efficiencies created through improved use of technology and machinery.

efficiency

the ability of a business to minimise its costs and manage its assets so that maximum profit is achieved with the lowest possible level of assets.

employee

a worker under an employer's control.

environmental sustainability

means that business operations should be shaped around practices that consume resources today without compromising access to those resources for future generations.

equity finance

the internal sources of finance in the business.

expenses

costs

external finance

the funds provided by sources outside the business, including banks, other financial institutions, government, suppliers or financial intermediaries.

factoring

the selling of accounts receivable for a discounted price to a finance or factoring company

FIFO

method of pricing inventory assumes that the first goods purchased are also the first goods sold and therefore the cost of each unit sold is the first cost recorded.

financial forecast

the business's predictions about the

future.

fixed costs

those costs that do not change regardless of

the level of business activity.

Gantt chart

a type of bar chart that shows both the scheduled and completed work over a period of time. It is often used in planning and tracking a project.

gearing

the proportion of debt (external finance) and the proportion of equity (internal finance) that is used to finance the activities of a business. Gearing ratios determine the firm's solvency.

global sourcing

a broad term that refers to businesses

purchasing supplies or services without being constrained by location. In the supply chain management activity, global sourcing means buying or sourcing from wherever the suppliers are that best meet the sourcing requirements.

globalisation

the removal of barriers of trade between nations.

gross profit

that part of a business's profit that

represents operating income minus cost of goods

sold.

human resource management

the management of the total relationship between an employer and employee.

income statement

a summary of the income earned and the expenses incurred over a period of trading.It helps users of information see exactly how much money has come into the business as revenue, how much has gone out as expenditure and how much has been derived as profit.

inertia

a term that describes a psychological resistance to change.

inputs

the resources used in the transformation (production) process.

interdependence

the mutual dependence that the key functions have on one another.

inventory control

a system that maintains quantities

and varieties of products appropriate for the target

market.

kaizen

Japanese for 'improvement'

leading edge technology

the technology that is the most advanced or innovative at any point in time.

leasing

a long-term source of borrowing for businesses. It involves the payment of money for the use of equipment that is owned by another party.

liquidity

he extent to which a business can meet its financial commitments in the short term

maintenance

the process of managing the needs of

staff for health and safety, industrial relations and legal responsibilities, including compensation and benefits, of all staff.

market research

the process of systematically collecting,

recording and analysing information concerning a

specific marketing problem.

market share

the business's share of the total industry

sales for a particular product.

marketing approach

focuses on finding out what customers want — through market research — and then satisfying that need.

marketing objectives

the realistic and measurable goals to be achieved through the marketing plan.

mediation

the confidential discussion of issues in a non-threatening environment, in the presence of a neutral, objective third party.

mortgage

a loan secured by the property of the borrower (business).

net working capital

the difference between current assets and current liabilities.

niche market

also known as a concentrated or micro market, a niche market is a narrowly selected target market segment.

operations

the business processes that involve transformation or, more generally, 'production'.

outsourcing

involves the use of third-party specialist businesses, for example, recruitment firms. It aims to take advantage of the specialist skills provided by them and to achieve a reduction in labour costs.

price

refers to the amount of money a customer is prepared to offer in exchange for a product.

price skimming

occurs when a business charges the highest possible price for the product during the introduction stage of its life cycle.

processes

refers to the flow of activities that a business will follow in its delivery of a service.

product differentiation

means distinguishing products (goods or services) in some way from its competitors.

product life cycle

consists of the stages a product passes through: introduction, growth, maturity and decline.

promotion

describes the methods used by a business to inform, persuade and remind a target market about its products.

quality management

those processes that a business undertakes to ensure consistency, reliability, safety and fitness of purpose of product.

recruitment

the process of locating and attracting the right quantity and quality of staff to apply for employment vacancies or anticipated vacancies at the right cost.

sale and lease-back

the selling of an owned asset to a lessor and leasing the asset back through fixed payments for a specified number of years.

secondary markets

deal with the purchase and sale of existing securities.

separation

the process of employees leaving voluntarily, or through dismissal or retrenchment processes.

solvency

the extent to which the business can meet its financial commitments in the longer term (more than 12 months).

stakeholders

any individual or group that has a common interest in or is affected by the actions of an organisation.

strategic

long-term, broad aims affecting all key business areas; that is, the strategic role of each key business function involves the managers of each function contributing to the strategic direction or strategic plan of the business.

supply chain

the range of suppliers a business has and the nature of its relationship with those suppliers.

SWOT analysis

involves the identification and analysis of the internal strengths and weaknesses of the business, and the opportunities in, and threats from, the external environment.

transformation

the conversion of inputs (resources) into outputs (goods and services).

transforming resources

those inputs that carry out the transformation process.

transformed resources

those inputs that are changed or converted in the operations process.

unfair dismissal

occurs where an employee is dismissed by their employer and they believe the action is harsh, unreasonable or unjust.

variable costs

those that vary in direct relationship to the level of business activity (level of production).

volume

how much of a product is made.

working capital

the funds available for the short-term financial commitments of a business.

(TQM): concept focuses

concept focuses on managing the total business to deliver quality to customers.

staff turnover

the loss of employees by a business who leave for a variety of reasons.