AL SL Vocab from ALL Modules

Break Even Analysis

a management tool used to calculate the level of sales needed to cover all costs of production, where any more sales will generate profit

Break Even Chart

the name given to the graph that shows a firm's costs, revenues, and profits (or loss) at various levels of output

Break Even Point

the position on the break-even chart where the total cost line intersects the total revenue line (where TC=TR)

Break Even Quantity

the level of output that generates neither a profit nor loss.

Contribution per unit (Unit Contribution)

the difference between the selling price of a product and its variable costs of production. The surplus goes towards paying fixed costs

Margin of Safety

the difference between a firm's level of demand and its break even quantity.

Profit

the positive difference between a firm's revenue and its costs.

Total Contribution

essentially, a firm's gross profit

Contribution

the sum of money that remains after all direct or variable costs have been deducted from the sales revenue of a product.

Loss

this exists when a firm's total costs exceed its total revenues. This occurs at all levels of output or sales below the break even quantity.

Target Price

the price set by a firm in order to reach break even or a certain target profit

Target Profit

the amount of surplus a firm intends to achieve, based on price and cost data. It is calculated by deducting total costs from expected sales revenues.

Target Profit Output

the sales volume or level of output required to achieve the target profit that business managers expect to achieve by the end of a given time period.

Operations Management

the function concerned with providing the right goods and services in the right quantities and at the right quality level in a cost-effective and timely manner

Production Process

the method of turning factor inputs into outputs by adding value in a cost-effective way

Sustainability

this promotes intergenerational equity, i.e. production enables consumption of goods and services for the people of today without compromising consumption for future generations

Value-added

this occurs during the production of a good or service because the value of the output is greater than the costs of production. Businesses cannot earn a profit if this does not occur in the production process.

Factors of Production

the resources needed to produce a good or service, namely land, labor, capital and enterprise

Productivity

a measure of a firm's operational efficiency level, calculating the rate at which inputs (factors of production) are transformed into outputs (goods and services).

Batch Production

producing a set of identical products. Typically used where the demand for a product is frequent and steady.

Flow Production

this type of production uses continuous and progressive processes, carried out in sequence. When one task is completed, the next stage of production starts immediately

Mass Production

this type of production involves large-scale manufacturing of a homogeneous (standardized) product. Unit costs of production are relatively low when using these methods.

Job Production

this type of production involves the manufacturing of a unique or one-off product. It can be completed by one person or by a team of people.

Standardization

producing an identical or homogeneous product in large quantities, such as printing a particular magazine, book or newspaper

Capital Intensive

the manufacturing or provision of a product relies heavily on machinery and equipment, such as automated production systems

Mass Customization

an operations method that uses flexible manufacturing systems to mass produce products that meet individual consumer needs and wants.

Labor Intensive

production that relies heavily on labor inputs, so the cost of labor accounts for the largest proportion of a firm's overall production costs. It is most apparent in the provision of personalized services.

Assisted Areas

regions identified by the government to be suffering from relatively high unemployment and low incomes, so are in need of regeneration through financial assistance.

Bulk-increasing Businesses

firms that are involved with products that increase in weight during the production process, so need to be located near their customers in order to reduce costs

Bulk-reducing Businesses

firms that need to locate near the source of raw materials because they are heavier, and hence more costly, to transport than the final product

Clustering

when a business locates near other organizations that operate in similar or complementary markets

Footloose Organization

a business that does not gain any cost reducing advantages from locating in a particular location. Hence, the firm can locate in almost any location

Industrial Inertia

the reluctance to relocate due to the inconvenience of moving. Managers may feel that the potential inconveniences and costs of relocation outweigh the benefits

Infrastructure

the term used to describe the transportation, communication and support networks in a certain area

Insourcing

the use of an organizations own people and resources to accomplish a certain function or task which would otherwise have been outsourced

Location

the geographical position of a business.

Offshoring

this involves relocating business functions and processes overseas. These functions can remain within the business (with overseas operations) or outsourced to an overseas organization.

Outsourcing

the practice of transferring internal business activities to an external organization to reduce costs and increase productivity

Government Incentives

financial enticements offered by the state to businesses to locate in a particular area or region, perhaps due to high unemployment

Reshoring

the reverse of offshoring; the transfer of business operations back to their country of origin

Subcontractors

outsourced firms that undertake non-core activities for an organization. They are used for their expertise and cost advantages they bring such as accountancy services

Ageing Population

a demographic change that tends to occur in high income countries, with the average age of the population getting higher

Demography

the statistical study of population characteristics, using data such as birth rates, death rates, aging populations and net migration rates

Flexitime

a system that enables workers to have a degree of autonomy to determine when they work, so long as they complete their work by set deadlines

Gig Economy

labor markets where workers are typically on short term, temporary contracts or carry out freelance work as independent contractors

Homeworking

an aspect of flexitime whereby people work from their own homes

Human Resource Management

the role of managers in planning and developing the organization's people; done through interrelated functions such as the recruitment, selection, dismissal and training & development of employees

Human Resource Planning/Workforce Planning

the management process of forecasting an organization's current and future staffing needs

Migrant Workers

people who move to other countries in search of better job prospects and opportunities

Mobility of Labor

the extent to which workers are flexible enough to move to different locations and/or their flexibility in changing to different jobs.

Net Migration

measures the difference between the number of workers entering a country (immigration) and the number of people leaving (emigration)

Portfolio Working

simultaneously carrying out a number of different jobs, often for various employers, usually on a part-time or temporary basis

Six Change Approaches

Kotter's model for reducing the impact of change and resistance to change. It consists of six strategies or approaches: i) education and communication, ii) participation and involvement, iii) facilitation and support, iv) negotiation and agreement, v) manipulation and co-option and vi) explicit and implicit coercion

Teleworking

a method of workforce planning whereby employees work in a location away from the workplace

Workforce

the number of employees at any one point in time for a particular organization; it is often used to measure the size of businesses

Barriers to Communication

anything that can limit or impede the effectiveness of communications, thereby leading to information failure. Examples include jargon, ignorance, internal politics and computer failure.

Channel of Communication

the method(s) through which communications take place between the sender and recipient

Communication

the transfer of information between different people and between organizations

Electronic Mail

the process of using computer wide area networks (WAN) as a mailing system for communication purposes

External Communication

conducted between members of one organization and members of another

Formal Communication

the official and established channels of communication

Grapevine Communication

this covers all aspects of communication through unofficial (informal) channels

Jargon

specialist or technical language used to speed up communication

Informal/Grapevine Communication

refers to unofficial, natural and unstructured channels of communication, naturally established by people from within an organization

Information Overload

the excessive amount of information being passed onto staff, i.e swamping workers with too much communication. This can increase workload and stress

Internal Communciation

refers to communications within the business organization

Internal Politics

refers to conflict between people within an organization

Non-verbal Communication

any form of communication other than oral communication, such as electronic systems (such as email), written methods (such as letters) and visual stimulus (such as body language)

Open Channels of Communication

these are used when information is not confidential and can be shared by anyone

Restricted Channels of Communication

these are used when information is confidential and is directed only to those who need to know

Verbal/Oral Communication

communication via the use of spoken words, such as meetings, interviews and appraisals

Videoconferencing

a communication method that allows communications to take place via telecommunications networks. The parties can see and hear each other using hardware and software technology

Visual Communication

the use of visual stimuli to communicate information or ideas

Written Communication

communication methods that make use of the written word, such as letters, memoranda, reports and notices

Commission

a type of financial reward that pays workers a certain percentage of the sale of each good or service that they are responsible for

Differentiated Piecework

an incentive scheme that rewards more productive workers who exceed a pre-determined benchmark

Division of Labor

the process of breaking down different aspects of a job or task and assigning different people to each particular part of the work in order to improve efficiency and output

Empowerment

a non-financial motivator that involves developing the potential of workers or teams to achieve the best they can by granting them the authority to make various decisions and to execute their own ideas to solve business problems

Employee Share Ownership Schemes

a type of payment system that rewards staff by giving them shares in the company or by selling the shares at a discounted price

Esteem Needs

refers to the desire of people to feel respected, having value and having self-respect; in Maslow's Hierarchy of Needs

External Recruitment

the process of hiring people from outside the business

Fringe Payments

the financial rewards paid in addition to a worker's wages or salaries such as subsidized meals, housing allowance and pension fund contributions

Herzberg's Motivation-Hygiene Theory

this theory looks at the factors that motivate employees, namely hygiene factors (that must be met to prevent dissatisfaction) and the factors that actually motivate employees

Hygiene Factors

parts of a job that do not increase job satisfaction but help to remove dissatisfaction, such as reasonable wages and working conditions

Induction Training

a type of training aimed at introducing new employees to the organization

Internal Recruitment

hiring people who already work for the business to fill a vacant post

Job Enlargement

increasing the number of tasks that an employee performs, thereby reducing or eliminating the monotony of repetitive tasks

Job Enrichment

given workers more responsibilities and more challenging jobs

Job Rotation

a form of job enlargement where workers are given different tasks, but of the same level of complexity, to help reduce the problems caused by performing repetitive tasks

Labor Turnover

measures the percentage of the workforce that leaves the organization in a given time period, usually a year.

Maslow's Hierarchy of Needs

this theory outlines 5 levels of needs, from satisfying physiological needs to slef-actualization.

Motivation

the inner desire or passion to do something; the driving forces can be intrinsic and/or extrinsic

Motivators

the factors that Herzberg considered to increase job satisfaction and motivation levels, such as praise and recognition

Movement

this occurs when people do something because they need to, so they feel obliged to do so; according to Herzberg

National Minimum Wage

the lowest hourly pay that all firms must remunerate their workers, as stipulated by the government

Non-financial Rewards

non-monetary factors that motivate people by offering psychological and intangible benefits (i.e. factors not directly linked to money)

Off the Job Training

training conducted off-site, such as at a tertiary college or hotel conference center

On the Job Training

training carried out while at the workplace. For example, the training can be delivered by a manager, supervisor, or other specialist

Performance-related Pay (PRP)

a payment system that rewards people who meet set targets over a period of time

Piece Rate

a payment system that rewards people based on the amount that they produce or sell