MGMT 100 - Chapter 1 Notes

Business: All profit-seeking activities and enterprises that provide goods and services necessary to an economic system.
Profits: Rewards for businesspeople who take the risks involved to offer goods and services to customers.
Not-for-profit enterprises: businesslike establishments that have primary goals other than returning profits to their owners.

Capitalism (synonymous with Private Enterprise System): an economic system that rewards firms for their ability to identify and serve the needs of customers.
Adam Smith: father of capitalism; book: Wealth of Nations.
Economy is best regulated by the “invisible hand” of competition.
Minimizes government intervention in economic activity.
Economic system determines business ownership, profits, and resources.
Firms rewarded for their ability to serve the needs of consumers.
Competition: battle among businesses for consumer acceptance.

An Entrepreneur: a person who seeks a profitable opportunity and takes the necessary risks to set up and operate a business.
Financial, personal, social, and career risks.
Sees a potentially profitable opportunity.
Devises a plan to achieve success in the marketplace and earn those profits.
Fuels the economy.
Provides innovation.

Colonial Period: primarily agricultural; prior to 1776.
Industrial Revolution: mass production with semiskilled workers, machines (1760-1850).
Age of Industrial Entrepreneurs: advances in technology and increased demand for manufactured goods, leading to enormous entrepreneurial opportunities (late 1800s).
Production Era: producing more goods faster, assembly lines; through the 1920s.
Marketing Era: consumer orientation, understand and satisfy needs and preferences of customer groups; since 1950s.
Relationship Era: benefits derived from longer-term links with individual customers, employees, suppliers, and other businesses – “loyalty”; began in the 1990s.
Social Era: businesses interact, connect, communicate, share, and exchange information (relationship management), generally using social media; since 2004.

Relationship Management: the collection of activities that build and maintain ongoing, mutually beneficial ties with customers and others.
Relationship management depends on technology.

Reliable workers dedicated to promoting strong ties with customers and partners.
Workforces capable of efficient, high-quality production.
Able to compete in global markets.
Technically savvy and innovative.

Several trends that emerged due to disruptions caused by the pandemic:
- Increase in adoption of digital technologies (online purchasing, remote work/study via digital conferencing software).
- Changes in work attitudes and development opportunities due to isolation.
- Remote work versus being physically present.

Generations and birth years:
- Boomers: 1946-1964
- Gen X: 1965-1976
- Millennials: 1977-1995
- Gen Z: 1996-2015
https://jasondorsey.com/about-generations/generations-birth-years/
Baby boomers are retiring; Generations X and Y (Millennials) launching their careers.
More generations mixing in the workplace than ever before.
Technology has intensified the hiring challenge (skill gaps between generations).
Canada is set to lose a large percentage of our workforce as baby boomers retire.

Two-thirds of Canada’s population growth is due to international immigration.
Employee teams with individuals of different genders, ethnic backgrounds, cultures, religions, ages, and physical and mental abilities are more effective.

Millennials demand work-life balance and prioritize training, flexibility, and diversity and inclusion over money.

Outsourcing: using outside vendors to produce goods or fulfill services and functions that were previously handled in-house.
Offshoring: relocation of business processes to lower-cost locations overseas.
Innovation Through Collaboration: a continued growing trend made easier with current technology.

Vision: the ability to perceive marketplace needs and what an organization must do to satisfy them.
Critical thinking and creativity:
- Critical thinking: the ability to analyze and assess information to pinpoint problems or opportunities.
- Creativity: the capacity to develop novel solutions to perceived organizational problems.
Ability to Lead Change.

Guide employees and organizations through changes.
Managers must be comfortable with tough decisions in fluctuating conditions.
Factors that require organizational change can come from external and internal sources.

Question: Why are the four factors of production important?
- A) The factors of production are regulated by the government.
- B) Human resources will always be the most important factor of production.
- C) Managing all four of the factors of production is critical for the successful operation of a business.
- D) Firms need to understand how to reduce the cost of production if they are going to be successful.
Answer: d

Question: Identify the business era during which managers began to pay more attention to what consumers wanted and needed rather than simply to what the firm could produce.
- A) The Industrial Revolution
- B) The production era
- C) The marketing era
- D) The relationship era
Answer: c

Question: The Internet has made possible another business tool for staffing flexibility: , or using outside vendors to produce goods or fulfill services and functions that were previously handled in-house or in-country.
- A) outsourcing
- B) nearshoring
- C) offshoring
- D) partnering
Answer: a