Business

What is the nature of a business?

An organisation that produces goods or services to satisfy needs and wants.

What are goods?

Tangible products sold by businesses.

What are services?

Intangible actions provided by businesses.

What is profit?

The financial gain made when revenue exceeds costs.

How do businesses contribute to employment?

They provide jobs and incomes.

How do businesses improve quality of life?

By providing goods, services and employment.

What is entrepreneurship?

The ability to start and manage a business while taking risks.

What is innovation?

The development of new ideas, products or processes.

What is risk in business?

The chance of financial loss or failure.

What are SMEs?

Small to medium enterprises.

What is a large business?

A business with significant employees, revenue and market share.

What is a local business?

A business operating in one area or community.

What is a national business?

A business operating across a country.

What is a global business?

A business operating internationally.

What is the primary industry?

Industry extracting natural resources.

What is the secondary industry?

Industry manufacturing goods.

What is the tertiary industry?

Industry providing services.

What is the quaternary industry?

Industry based on knowledge and information services.

What is the quinary industry?

Industry involving high level decision making and specialised services.

What is a sole trader?

A business owned by one person.

What is a partnership?

A business owned by two or more people.

What is a private company?

A company owned privately by shareholders.

What is a public company?

A company listed on the stock exchange.

What is a government enterprise?

A business owned by the government.

What factors influence legal structure choice?

Size, ownership and finance.

What are external influences on business?

Factors outside the business affecting operations.

What are examples of external influences?

Economic, legal, social, technological and political factors.

What are internal influences on business?

Factors within the business affecting operations.

What are examples of internal influences?

Products, location, resources and management.

Who are stakeholders?

Individuals or groups affected by business activities.

What is the establishment stage of the business life cycle?

The stage where the business starts operating.

What occurs in the growth stage?

Sales, customers and profits increase.

What occurs in the maturity stage?

Growth slows and stabilises.

What is post maturity?

A stage of decline, renewal or closure.

What is liquidation?

The selling of business assets to pay debts.

What is voluntary cessation?

When owners choose to close the business.

What is involuntary cessation?

When a business is forced to close.

What can contribute to business decline?

Poor management, competition or changing markets.

What is effective management?

Achieving business goals efficiently and effectively.

What interpersonal skills do managers need?

Skills for working with and motivating people.

Why are communication skills important in management?

They ensure clear information sharing.

What is strategic thinking?

Planning for long term business success.

Why is flexibility important for managers?

It helps businesses adapt to change.

What is decision making in management?

Choosing the best course of action.

What is the role of managers in reconciling stakeholder interests?

Balance the needs of different groups.

What are common business goals?

Profit, growth, market share and social responsibility.

What is market share?

The percentage of sales controlled by a business.

Why is staff involvement important?

It improves motivation and innovation.

What is mentoring?

Experienced workers guiding less experienced staff.

What is the classical management approach?

A focus on planning, organising and controlling.

What is an autocratic leadership style?

Managers make decisions alone.

What is a hierarchical organisational structure?

A structure with clear levels of authority.

What is the behavioural management approach?

A focus on leadership, motivation and communication.

What is a participative leadership style?

Employees contribute to decision making.

What is the contingency approach?

Management adapting to circumstances.

What is the management process?

Planning, organising, leading and controlling.

What are operations in business?

The production of goods and services.

What is the production process?

The steps used to create goods or services.

What is quality management?

Processes ensuring products meet standards.

What is marketing?

Activities promoting and selling products.

What is a target market?

The specific group a business aims to sell to.

What is the marketing mix?

Product, price, promotion and place.

What is finance in business?

The management of money and funds.

What is a cash flow statement?

A record of money entering and leaving a business.

What is an income statement?

A report showing profit or loss.

What is a balance sheet?

A statement of assets, liabilities and equity.

What is recruitment?

The process of hiring employees.

Why is training important?

It improves employee skills and productivity.

What is an employment contract?

A legal agreement between employer and employee.

What is voluntary separation?

When an employee chooses to leave.

What is involuntary separation?

When an employee is dismissed.

What is ethical business behaviour?

Acting honestly and responsibly.

Why is change management important?

It helps businesses adapt successfully.

What are internal influences causing change?

Changes within the business such as staff or structure.

What are external influences causing change?

Changes outside the business such as laws or technology.

Why must businesses identify the need for change?

To remain competitive and effective.

What are business information systems?

Systems used to collect and manage information.

Why should managers set achievable goals?

To provide realistic direction and motivation.

Why do employees resist change?

Fear of uncertainty or job loss.

What is the role of management consultants?

Provide expert business advice.

What is quality management beneficial for?

Improving efficiency and customer satisfaction.

How can SMEs manage change effectively?

By planning, communicating and involving staff.

Why is cash flow management important?

To ensure bills and expenses can be paid.

What is the purpose of the balance sheet?

Show the financial position of a business.

What is the purpose of the income statement?

Show business profitability.

How can stakeholder conflicts be resolved?

Through communication and compromise.

What is the role of operations?

Transform inputs into outputs.

What is the role of marketing?

Identify and satisfy customer needs.

What is the role of finance?

Manage funds and financial performance.

What is the role of human resources?

Manage employees and workplace relations. What is finance in business?

Why is finance important?

It helps businesses operate, grow and survive.

What is a cash flow statement?

A record of cash entering and leaving a business.

What is cash inflow?

Money received by the business.

What is cash outflow?

Money spent by the business.

Why is positive cash flow important?

It allows the business to pay expenses and debts.

What can happen with poor cash flow management?

The business may struggle to pay bills.

What is an income statement?

A financial report showing profit or loss over a period.

What does an income statement show?

Revenue, expenses and net profit or loss.

What is revenue?

Money earned from sales or services.

What are expenses?

Costs incurred in running the business.