Business Management Vocabulary Review

A comprehensive set of vocabulary flashcards covering key terms in IB Business Management, aimed at helping students review and consolidate their knowledge for effective exam preparation.

360-degree appraisal

A type of appraisal system that provides feedback from a range of people including managers, co-workers, subordinates, and customers.

7 Ps (marketing mix)

Refers to the marketing of services which includes people, processes, and physical evidence, in addition to the traditional 4 Ps (product, price, promotion, place).

Above the line (ATL) promotion

Form of promotion that refers to any form of paid-for promotional technique through independent consumer media.

Academic journals

Publications containing the latest educational research and academic theory.

Accountability

The extent to which a person is held responsible for the success or failure of a task, job, or project.

Accounting rate of return (ARR)

Method of investment appraisal calculating the average annual profit of an investment project as a percentage of the invested amount.

Acid test ratio

Short-term liquidity ratio measuring an organization’s ability to pay its short-term debts without selling stock.

Accumulated depreciation

Accrued value of non-current assets, affected by time due to depreciation.

Acquired needs theory

D. McClelland’s theory stating three types of needs (achievement, power, affiliation) must be met to improve motivation.

Ad-hoc market research

Market research conducted as needed for specific problems faced by the organization.

Adams’ equity theory of motivation

Suggests people compare fairness in the workplace based on the ratio of their input (effort) to output (rewards).

Adding value

The process of producing a good or service that is worth more than the cost of resources used.

Adaptive cultures

Organizational cultures that are responsive and receptive to change.

Adverse variance

Occurs in the budget when profit is lower than expected due to higher costs or lower revenues.

Advertising

A form of promotion using visual and audio marketing to inform and persuade customers to buy.

Ageing population

A higher mean (average) age of the population.

Agents

Independent intermediaries helping to sell a vendor’s products for commission.

Algorithm

A defined set of rules or procedures AI uses to solve problems.

Appraisal

Formal procedure assessing the performance and effectiveness of an employee.

Arbitration

Independent conflict resolution method where all parties agree to accept the arbitrator's decision.

Artificial intelligence (AI)

Area of computer science enabling machines to perform tasks requiring human intelligence.

Artificial neural networks (ANN)

Learning algorithms that can solve problems independently by processing new data.

Assets

Possessions owned by a business that have monetary value.

Autocratic management (leadership)

Management style with centralized decision-making without input from others.

Average costs

Cost per unit of output calculated as total cost divided by quantity of output.

Average revenue

Amount received from customers per unit of a good or service sold.

Backward vertical integration

Acquiring a company further up the supply chain from the final consumer.

Bad debt

Occurs when debtors cannot pay outstanding invoices, reducing cash inflows.

Balance sheet

Financial statement showing the value of a firm’s assets, liabilities, and owners’ equity at a point in time.

Bankruptcy

Situation when a business declares inability to pay back debts.

Bar charts

Visual graphs presenting categorized data for comparison.

Bargain products

Goods perceived to be of high quality sold at low prices.

Barriers to communication

Factors preventing effective information transfer.

Batch production

Operations method producing identical products in sets.

Below the line (BTL) promotion

Promotion methods that do not use external media agents.

Benchmarking (or yardstick)

Routine process comparing products and performance with competitors.

Big data

Extensive amounts of unprocessed and processed data from various sources.

Boston Consulting Group (BCG) matrix

Management tool examining a business's product portfolio according to market share and growth.

Break-even

Condition when a firm’s sales revenues equal all production costs.

Break-even analysis

Tool to determine sales volume needed to cover costs.

Break-even chart

Graphical illustration of production costs, sales revenues, and profits at various output levels.

Break-even point (BEP)

Point on a break-even chart where total costs equal total revenue.

Break-even quantity (BEQ)

Quantity of sales needed to reach break-even.

Break-even revenue

Value of output needed to break-even, shown on the y-axis.

Brand

Registered name used to identify a product of a business organization.

Branding

Practice using exclusive symbols to identify specific products or businesses.

Brand awareness

Degree to which customers recognize a particular brand.

Brand development

Strategy communicating the value and purpose of a brand.

Brand loyalty

Degree of customer devotion to a particular brand.

Brand switching

Switching to alternative brands due to loss of original brand appeal.

Brand value

Expected earning potential of a brand.

Budget

Detailed financial plan for a set time period.

Budgetary control

Methods to balance actual outcomes with budgeted outcomes.

Bulk-increasing industries

Businesses needing to be near consumers as final products are bulkier than raw materials.

Bulk-reducing industries

Businesses needing to be near raw materials as final products are lighter.

Capital outlay (or principal)

Initial money invested in a project.

Business

Decision-making organization for producing goods or services.

Business angels

Wealthy individuals investing in high-growth potential ventures.

Business etiquette

Customs and manners for conducting business globally.

Bureaucracy

Formal policies and procedures within an organization.

Capacity utilization

Extent to which an organization operates at its maximum level.

Capacity utilization rate

Firm’s actual output as a percentage of its capacity.

Capital employed

Value of funds used to operate the business.

Capital expenditure

Spending on purchasing non-current assets.

Capital intensive production

Manufacturing relying mainly on machinery and capital equipment.

Capital productivity

Measures efficiency of non-current assets to generate output.

Cash

Money available to an organization at its premises or in the bank.

Cash cows

BCG matrix products with high market share in low growth markets.

Cash flow

Movement of cash inflows and outflows in an organization.

Cash flow forecasting

Predictive technique for cash flow over a time period.

Cash flow problems

Liquidity issues from insufficient funds for business operations.

Cash inflow

Money coming into a business from earnings.

Cash outflow

Money going out of a business for costs.

Centralization

Decision-making predominantly made by senior managers.

Chain

Series of interconnected business outlets owned by one company.

Chain of command

Formal lines of authority in an organization.

Collateral

Financial guarantee using non-current assets to secure loans.

Chance node

Probable outcomes in a decision tree.

Change management

Processes and techniques for planning and evaluating changes.

Chatbots

AI virtual assistants simulating human conversations.

Circular business models (CBMs)

Strategies prioritizing sustainability by minimizing waste.

Circular supply models

CBMs focusing on renewable and recyclable resources.

Cloud computing

Online storage and data management systems.

Closure

Temporary business shutdown due to extreme actions.

Closing balance

Cash value at the end of a trading period.

Clustering

Businesses locating near others in related industries.

Collective bargaining

Negotiation process of working conditions and pay between employers and employees.

Commission

Payment system rewarding sales as a percentage.

Communication

Transfer of information between entities.

Companies (corporations)

Business organizations owned by shareholders.

Competence

Capacity and confidence to enhance mastery in desired tasks.

Competitors

Rival firms contesting for the same customers.

Competitive pricing

Setting product prices at similar levels as competitors.

Conciliation

Conflict resolution aligning incompatible stakeholder interests.

Consumer goods

Products bought for personal consumption.

Consumer panel

Group providing feedback in primary market research.

Continuous market research

Ongoing type of market research.

Contribution

Amount remaining from sales revenue after variable costs.

Contribution pricing

Pricing higher than direct costs for a positive contribution.

Consumer profiles

Characteristics of consumers in market segments.