Foundations of Business: Units 1-3 & Leadership Review

Comprehensive vocabulary flashcards covering foundations of business, business structures, operational interdependence, marketing frameworks, statistics, management functions, and leadership styles.

Good

A physical product exchanged between buyer and seller.

Service

A purchase that results in something being done for you rather than a physical item.

Merchandising Business

A business category that buys finished goods and resells them at a higher price.

Manufacturing/Producing Business

A business category that converts raw materials into finished products.

Non-Profit / Not-for-Profit

An organization governed by a volunteer board that raises funds to advocate for a social cause or mission rather than generating profit.

Primary Industry

A sector of industry that extracts natural resources (e.g., farming, mining, fishing, forestry).

Secondary Industry

A sector of industry that turns raw materials into finished goods (e.g., car manufacturing, food processing, construction).

Tertiary Industry

A sector of industry that provides services (e.g., retail, healthcare, banking, transportation).

Revenue

The money earned by a business from sales.

Expenses

The operational costs of running a business.

Profit/Loss

The financial gain or deficit of a business, calculated as $\text{Revenue} - \text{Expenses}$.

Unlimited Liability

A legal condition in unincorporated businesses where the owner is legally viewed as the business, meaning personal assets are at risk if the business is sued or incurs debt.

Limited Liability

A legal protection in incorporated businesses where the company is a separate legal person, preventing owners from being personally liable for company debts or lawsuits.

Sole Proprietorship

An unincorporated business owned by one individual who keeps 100% of the profits and exercises full control, but carries unlimited liability.

Partnership

An unincorporated business structure where partners share capital, skills, and workload under a partnership agreement, carrying joint and unlimited liability unless formed as an LLP.

Private Corporation

An incorporated business whose shares are held by a small group and are not publicly traded.

Public Corporation

An incorporated business whose shares are publicly traded on stock exchanges (such as the TSX) to raise capital.

Chain

A retail model where a single corporation owns and maintains centralized control over all business locations.

Franchise

A business model where independent owners pay fees to a parent company for the right to use its brand, system, and operational model.

Co-operative

A business owned and democratically controlled by its members (one member = one vote) with an emphasis on providing services over maximizing profit.

Crown Corporation

A government-regulated enterprise structured like a private company (e.g., Canada Post, LCBO).

Transformational Campaigns

Large-scale strategic initiatives that modernize technology, reduce costs, improve customer experience, and reorganize business operations.

Operational Interdependence

A closed-loop operational structure where every department in a business relies directly on the inputs and performance of other departments to function efficiently.

Income Statement

A financial statement used to evaluate financial performance using the formula: $\text{Revenue} - \text{Expenses} = \text{Profit}$.

Balance Sheet

A financial statement that summarizes a business's assets, liabilities, and owner or shareholder equity.

Quantitative Data

Statistical information represented as numbers (e.g., sales, profit, customer counts).

Qualitative Data

Non-numerical statistical data based on opinions, feedback, reviews, and survey responses.

Primary Data

Firsthand data collected directly by the business itself.

Secondary Data

Data gathered from external, third-party sources outside the business.

The 3 C's

A marketing framework focused on analyzing the Customer, the Company, and the Competitor.

The 4 P's

The foundational marketing mix consisting of Product, Price, Place, and Promotion.

Autocratic Leadership

A centralized leadership style characterized by 'Do as I say,' where the leader makes all decisions without team input; offers rapid, decisive choices but risks employee burnout and turnover.

Democratic Leadership

A consensus-driven leadership style characterized by 'What do you think?' that values collaboration and employee buy-in, but risks slow decision-making and deadlock.

Transformational Leadership

A vision-focused leadership style characterized by 'Follow me into the future,' aiming for organizational change and high innovation, though risking operational neglect and reliance on one leader.

Transactional Leadership

A task-driven leadership style characterized by 'This for that,' using performance metrics, contracts, and penalties to maintain accountability, but stifling bottom-up innovation.

Laissez-Faire Leadership

A hands-off leadership style ('Figure it out' / 'allow to do') that grants complete autonomy to experienced teams, but risks internal misalignment and lack of defined structure.

SWOP Analytics

A strategic business analysis tool evaluating Strengths, Weaknesses, Opportunities, and Problem Solving.

SMART Goals

A goal-setting framework requiring targets to be Specific, Measurable, Attainable, Relevant, and Timely.

Maslow's Hierarchy of Needs

A five-tier psychological model ordered from bottom to top: Physiological, Safety, Love and Belonging, Esteem, and Self-Actualization.

Board of Directors

A group elected by shareholders to govern and oversee the corporation, responsible for hiring and firing the CEO.

Corporate Social Responsibility (CSR)

A business concept holding that companies must address economic, legal, ethical, and environmental responsibilities (such as reducing pollution and practicing fair labour).

Business Ethics

Established external rules, standards, or guidelines for conduct and behaviour within a business context (e.g., not lying in advertisements).

Morality

An individual's personal beliefs and internal compass regarding what is right and wrong (e.g., an owner refusing to exploit workers).

POLC Framework

A foundational management process consisting of Planning (setting goals), Organizing (allocating resources), Leading (motivating employees), and Controlling (monitoring performance).

Interpersonal Management Role

A managerial function that centers on interacting and communicating with people, such as resolving workplace conflicts.

Informational Management Role

A managerial function centered on gathering, analyzing, and sharing data across an organization.

Decisional Management Role

A managerial function that involves making strategic business choices, allocating resources, and resolving operational problems.

Types of For‑Profit Businesses

Finance, Technology & ICT, Human Resources (HR), Marketing & Analytics, and Management & Leadership

Human Resources (HR) 

• Recruits and hires employees 

• Provides training and upskilling 

• Manages compensation, benefits, and performance incentives 

• Ensures compliance with Ontario employment laws, safety regulations, DEI policies 

• Supports workplace standards and employee well-being 

Marketing & Analytics 

• Connects products/services to customers 

• Identifies target audiences 

• Uses the 3 C’s (customer, company, competitor) 

• Uses the 4 Ps (product, price, place, promotion) 

• Conducts research and analyzes data 

• Works with Finance on budgets and ROI 

• Works with Technology on digital tools and analytics

Management & Leadership

• Sets strategic direction 

• Oversees planning, organizing, leading, controlling 

• Ensures departments follow operational policies 

• Measures performance metrics 

• Coordinates cross-department collaboration

How They Work Together (Closed‑Loop System) 

What does CSR stand for

Corporate Social Responsibilities

Corporate Social Responsibility 6 main areas to focus on

CSR e.g.

• Economic responsibilities

• Legal responsibilities

• Ethical responsibilities

• Environmental responsibilities

Management hats

Interpersonal, Decisional, and Informational

Interpersonal

Working with people.

Informational

Gathering and sharing information.

Decisional

Making choices and solving problems.

Characteristics of a good leader: 

People oriented 

Purposefulness 

Collaboration 

Decisiveness 

Self-awareness