Buisness Management

1.2 Entrepreneurship


Entrepreneurship — The act of starting and operating a new business by identifying opportunities and taking risks in hopes of making a profit.


1.3 Motivation behind starting a business


Financial independence — The ability to support your lifestyle by managing and controlling your own income and expenses without relying on an employer.


Personal independence — The freedom to make your own decisions and manage your work, lifestyle, and business without restrictions from an employer.


Making a profit — The goal of earning more income by operating a business rather than working for an employer.


Fulfil a market need — Addressing a gap in the market by providing a product or service that is in demand but not available


Fulfil a social need — The production of goods and services that contributes to societal needs (eg. homelessness, food security, etc)  


Benefits

Limitations

• Being your own boss — independence

• Possibility of making a profit

• Challenging, rewarding and satisfying

• Increasing personal wealth

• Contributing positively to society

• Developing own creative ideas

• Overcoming unemployment

• Achieving a better lifestyle

• Employing family members

• Possible tax advantages

• Hard work and long hours

• Meeting the demands of customers, suppliers and

financiers

• Fluctuating or uncertain income

• Risk of failure

• Stress and worry

• High levels of responsibility

• Constantly solving problems

• Difficulty selling the business



1.4 Characteristics of business managers and entrepreneurs


Manager—has responsibility for overseeing the operations of the business to ensure that it successfully achieves its goals.


- Leadership qualities

- Taking calculated risks

- Communication and listening

- Self-motivation


Entrepreneur— willing to seize opportunities to start and operate a business, and prepared to take risks in the hopes of making a profit


- A shared vision

- Initiation

- Innovation and enterprise


1.5 Identifying business opportunities


Innovation — significantly improving an already existing good, service or process.


Invention — the development of a brand new product


Changing customer needs:


- Changing income

- Changing tastes and fashion

- Changes in the number of potential customers


Business opportunity —a chance to start/grow a business by fulfilling market needs


Research and development (R&D) —  the process businesses use to improve existing products, create new ones, and enhance production methods. It involves investigating, developing, and testing new ideas to innovate and stay competitive.


1.6 Goal setting and decision-making in business



Vision statement — describes where the business wants to be in the future (e.g five years from now)


Mission statement — describes what the business will do and how it will achieve its vision


Financial goals — target that aim to  improve the financial performance of a business


- Making a profit

- Increase sales

- Increase market share


Social goals — targets that aim to improve the welfare of the community, environment or employees of a business.


- Reduce the business’ impact on the environment

- Resolve community issues

- Advocate for employee welfare



1.7 Business concept development


Business opportunities VS concept development


Ideas come from assessing business opportunities, leading to the development of the business concept.


concept development - researching and conducting studies how to make it a viable approach


Protecting Intellectual Property (IP) 


Trademark — Protection of reputation and identity (logos, slogans, etc) 


Patent — Protection of tangible business ideas which haven’t been developed yet 


Copyright — Protection of product and original work


1.9 Market research and initial feasibility studies


Market research — a process involving gathering and analysing information concerning a specific market.


3 Steps of Market Research:


1. Identifying the information needed to make a decision about the potential of a business

2. Gathering relevant information from appropriate sources

3. Analysing and interpreting the relevant results to extract some clear information that will assist in decision-making.


Feasibility study — an assessment of the business ideas potential for success


Inclusions:


- an assessment of a market

- a consideration of the operations

- an analysis of commercial feasability


1.11 The contribution of businesses to the nation


Economic wellbeing — refers to the level of income, consumption and wealth people have to support their material living standards.


- Economic growth (GDP → higher GDP = stronger economy)

- Employment

- Taxation revenue


Social wellbeing — measures the quality of life individuals have reflected by their non-material living standards (general happiness, crime rates, environmental quality ,etc)


- Social wellbeing

- Innovation


Corporate Social Responsibility (CSR) — the obligations a business has above its legal responsibility to the wellbeing of employees, customers, the community and the environment.


1.12 The methods by which a culture of business innovation and entrepreneurship may be fostered in a nation 


Methods of fostering innovation 


  • Council Grants which are a one-off financial payment from a local council to a business, which do not need to need to be repaid, that aims to support business ideas and development

  • Regional Start up hub are physical spaces that individuals and businesses can go to in order to have office facilities to work in, or to obtain support regarding business matters 

  • School Based entrepreneurship programs introduce students to the business world, allowing them to develop their business knowledge and problem-solving skills