Common Wrong Answer Exam Notes (BMA)

Groups at Work:

• Project team -- comprised of ppl w complementary skills necessary to complete a single project
  • Outside project, team members have separate responsibilities
  • When project ends, team members go back to original jobs
• Quality circle -- participative management technique where:
  • Employees voluntarily work together to solve quality/performance-related problems + report results to management
  • Long term position
    • Doesn’t end when one issue is solved
• Team vs group
  • Group = ppl just meet regularly
  • Team = each has a complementary skill

Credit Cards:

• Annual Percentage Rate (APR): the interest charged (at the end of the year) for all overdue or late payments

Private Enterprise Economy:

• Person’s skills = main determinant of their income
• Supply + demand = determines exchange of goods
  • Higher demand = higher prices
• Regulated, but not controlled, by the govt
  • = companies must adhere to guidelines and laws
• May use marketing to increase sales → cause customers to be aware of products/services

Types of Currencies:

• Pegged: when a currency is created to mirror another country’s currency; done in developing nations to give them a more stable currency.
• Free-floating: when a currency is able to fluctuate based on economic factors; usually in developed countries (USA)

Types of Analytical Reports:

• Feasibility -- weighing pros and cons of a certain action
• Troubleshooting -- to solve a problem
• Justification -- evaluates the success/failure of a previous decision/course of action
• Market analysis -- evaluates a particular market

Types of Management:

• operations management -- systematic design, direction, and control of processes used to create services and products
• Knowledge Management -- the function of collected, storing and sharing employees’ personal knowledge throughout and organization
  • Usually emphasizes the exchange of tacit or experience-based knowledge
• marketing
• accounting
• human resources

Types of Orders:

• advance orders -- regular order that is placed now but requested to be delivered at a future date (weeks, months, etc)
  • (ex) placing orders for a game before its release to ensure enough supply for anticipated demand
• reorder -- ordering previously-ordered items
  • (ex) place orders to replenish stock
• special order -- request for custom item that vendor does not usually have in stock
  • (ex) order a sign for your store
• blanket order -- covers all/part of retailer’s seasonal requirements
  • typ. placed MONTHS before the season
  • no detailed specifications/shipping dates
• Backorder -- when a regularly ordered item is out of stock
  • When the items/products are available they are immediately shipped

Dating Terms:

• 5/10 net 30 means:
  • 5% discount if buyer pays within 10 days
  • entire invoice must be paid within 30 days

Quality Control:

• total quality management (TQM) -- 14 point-technique
  • do not rely on inspection to ensure quality
  • lower costs by working w just one supplier
• Six Sigma -- system for reducing variation in processes (aka defect levels) using advanced statistical techniques
  • improve quality + maximize efficiency while lowering costs
  • constantly build upon previous goals to continuously improve + attain perfection
  • Goal: 3.4 per million products/services produced
• lean operations -- series of mathematic and visual tools to streamline material and info flow
• continuous improvement -- any ongoing effort

Types of Organizational Goals:

• organizational goals -- overall goals that a business wants to achieve
• order goals -- control/prevent negative behavior
  • address ethic/legal issues, expectations in workplace
• product goals -- goods and services
  • Ex. To have full line of different sizes and colours of a product available by ___
• profit goals -- pricing
• short-term goals -- takes less than a year to achieve

WBS (Work Breakdown Structure):

• dividing project into smaller, meaningful components to complete
• effectively schedule, assign, monitor project activities
• 8/80 rule:
  • no work “package” should take less than 8 hrs or more than 80 hours

Miscellaneous:

• elevators must be checked by govt regulations
• can be considered raw materials if used to complete finished product:
  • bolts
  • paper
  • leather
• example of marketing-research activity -- evaluating survey responses from customers
• example of pricing activity -- calculating break-even points
• example of purchasing activity -- gathering quotes from vendors
• example of analyzing human-resources information -- reviewing several other companies’ pay scale to determine if the pay for the firm’s marketing director is appropriate
  • human-resource management function -- responsible for finding/hiring skilled workers, determining pay for those workers and conflict-resolution
• paradigm innovation -- a product that revolutionized the perception of an entire company/industry
  • e.g. windows operating system
  • *Note: innovations are only slight changes/improvements, not entirely new
• product innovation -- improving a product
• certificate of authority -- gives permission to foreign businesses to operate within the borders of the authorizing state
• Executive staff reports to CEO reports to board of directors (made of people who decide the business’ activities, sometimes shareholders)
• project managers should possess technical skills to understand the work of other members
  • to answer questions, give directions, solve problems
• termination checklist -- list of things that must be done during closing phase of project
• expense audit -- reviewing + evaluating various project expenses
• spooling -- process of transferring computer data to a temporary location so the data can be retrieved and possessed thru a diff computer program
• Economies of scale -- reduction in cost per unit resulting from increased production, realized thru operational efficiencies
• Stress = short-term, burnout = caused by stress but is long-term
• Employee turnover -- when someone leaves the company and is replaced by someone else
• Territorial Routing Application (TRA): Used to schedule/execute sales calls
• Electronic Data Interchange (EDI): Exchanges information between suppliers and businesses
• Industriousness: Being ready and willing to work, as well as taking pride in the quality of work (often similar to cooperativeness)
• Finishing tasks with care: finishing tasks on time or before the time, not in relation to quality

Currency

• Pegged currency -- set by country’s government to mirror another country’s currency
  • Often done by developing countries in order to achieve currency stability
• Free-floating currency -- value fluctuates based on supply/demand
• Indirect quotation -- # of USDs that 1 unit of foreign currency could buy
  • Using foreign currency as base
• Direct quotation -- # of foreign currency that 1 USD could buy ]
  • Using domestic currency as base

Types of Business Functions

• Organizing -- setting up the way that a business’ work will be done
  • Division of labor
  • Establishing levels of authority
• Staffing -- finding workers for a business
  • identify the skill sets needed → identify qualified candidates
  • Promoting employees
  • Assigning employees with the most suitable skills to the correct tasks/jobs
• Controlling -- monitoring the work effort
  • Inspecting outputs, providing employee feedback/performance evaluation
  • Ways to Control:
    • feedforward -- taking preventative measures/occurs before a business activity is performed
      • involves establishing standards (e.g. quality of raw materials), proper procedures for carrying out activity
      • standard -- measure for determining the level of excellence of something → a control tool
    • concurrent -- monitoring while employees are performing it
      • allows manager to determine if employee is doing work correctly and efficiently
    • feedback control -- occurs after business activity has been completed
• Planning -- deciding what will be done and how it can be accomplished
  • Mission statement
  • Timelines, budgets and goals
• Directing -- providing guidance to workers and work projects
  • Initiating action → providing guidance/instruction about the proper way to perform a task
  • Motivating employees
  • Giving employees instructions for completing activities

Project Cycle Phases (not sure how many total):

1. Planning: Objectives, Work Breakdown Structure and project resource allocation are developed.
2. Definition: Project Charter is developed, and the project is INITIATED.
3. Execution: Implementing the “project,” whatever that may be, and using control methods to monitor the success.
4. Closure: Determining if the deliverables were met and returning resources/equipment to their original places and or giving them new uses in the business. Create a post-implementation review after releasing the project deliverables. Lessons-learned document also created.

Project Resources:

• SOW (Statement of work) The terms and conditions of a project: hours, duration, benefits, etc.
  • Contains purpose: why?
  • Contains Scope: What we will and will not be doing; we will be investigating the effects of promotion on our sales, but we will not be developing alternative options
• Project Charter: The authorization to start a project, explains the goals (Done in the definition phase of project)
• Work Breakdown Structure: Who is responsible for which tasks, can be referred to by employees.
  • Work Breakdown Structure Dictionary: Detailed account of how to complete specific tasks in a project.

BANKING FEES:

Annual fee – paid once a year to the credit card company to allow the person to continue his use of the credit card

Annual percentage rate – interest paid on the remaining portion of the credit card bill that one does not pay, i.e. interest on the amount that remains after the minimum payment is made

Late fee – charged when one does not submit any payment at all before the monthly due date

Overdraft fee – charged when one draws out more money (i.e. writes a check that is more) than is available in their checking account

TYPES OF MANAGEMENT

Business-information –

Human resources –

Capital-assets –

Financial-services – manages the BUSINESS’ money

TRADE SECRETS

- Info that a business develops/owns that can be used to obtain competitive advantage or financial gain

- *trade journals – academic journal for a particular trade

PARTS OF A LINK: http://maps.google.com/maps?hl=en&tab=wl

Scheme – identifies the protocol to be used to access the resource on the internet

- either HTTP or HTTPS

Host name – identifies the host that holds the resource

- maps.google.com

Path – identifies the specific resource within the host that the Web client wants to access

- /maps

Query string – follows the path, provides string of info that the resource can use for some purpose

- ?hl=en&tab=wl

PROJECT-MANAGEMENT SOFTWARES:

- allows businesses to:

o plan

• • • automate, schedule

o track

o evaluate

all aspects of a project

- helps project manager allocate resources in most efficient ways

o human, material, financial, capital

Stakeholders:

- define project’s purpose

- establish project’s standards

- evaluate quality of project deliverables

TYPES OF BUSINESS RECORDS:

Human resources records — includes employee attendance, positive/negative notes/reviews on employee performance

Production records – info on the products themselves

R&D records – research and development

Inventory records – track the products in the warehouse

COMPUTER SOFTWARES:

Electronic data interchange (EDI) – a system that allows businesses to transmit info to/from their suppliers

- tracks inventory

- determines when business should reorder

- increases purchasing function’s efficiency

Customer relationship management (CRM) – monitor customer data, build ongoing customer relationships

Territorial routing software – develop efficient sales-call patterns

TYPES OF ORDERS:

Reorder – order for same goods previously purchased from the same vendor

Open order – order for staple goods that is placed with one of several available vendors who can meet immediate needs (time, price, quantity, etc.)

Backorder – when a regularly stocked item is temporarily out of order + the customer order it anyway

- unless customer cancels the order, businesses typ ship it out the moment it becomes available again

CONFUSING TERMS @ “QUALITY”

Quality management – ensure the excellence of a process/deliverable

ASPECTS OF QUALITY MANAGEMENT:

Quality assurance – developing systems/processes to prevent product defects AS they are being created

quality control – identifying defects in deliverables AFTER they have been created

- includes inspecting the finished product

quality improvement – focuses on product improvement, i.e. for the FUTURE

- may involve using better materials for better products

- customer-satisfaction feedback allows businesses to determine if quality improvement is needed and in what way

TYPES OF INSURANCE:

Captive insurer – legal insurance companies that are formed (as subsidiaries, sister companies) by the very same company in order for loss coverage that a commercial insurer refuses to cover

Lending institution – loan money to ppl

Miscellaneous

- businesses can use silence (during discussion) to make the vendor make a concession

- Gridlock – neither party gets what they want

- Accounts receivable –

- Accounts payable –

- Project charter – serves as authorization to start a project

o Outlines purpose/terms of project

o = contract with the project’s stakeholders

o all stakeholders must agree and sign the charter before it is authorization for a project team to begin

o may be slightly modified, but all modifications must be agreed and signed off by all stakeholders

§ usually made by project manager

- Plan-Do-Check-Act (PDCA)

o continuous-improvement technique

- what-if planning – use computer programs to analyze level of risk in different business functions

o calculates risk levels in a variety of scenarios based different combinations of data à obtains results under these circumstances

o company analyzes quantitative results à uses it to make decisions

- qualitative research – study based on opinion/expertise

- top-down forecasting – method of predicting sales

- Organic entity – a business that is very flexible and adaptable

o little job specialization

o few layers of management

o decentralized decision-making

o not much direct supervision

- Generic provider – business that lacks a well-known logo bc the logo isn’t advertised. Opposite of brand-name products.

- expropriation – govt taking over private property

- substantiation – to provide proof/evidence of smth

- aptitudes = innate and may be inherited VS interests = influenced by outside forces

ANTI-TRUST LAWS

- Laws protecting against monopolies

ARTHUR ANDERSEN AND ENRON: 2001 scandal

- Arthur Andersen = one of the biggest accounting firms from the early 1900s all the way until this scandal

- The reason why it was so successful was because it had the absolute trust of its clients and the public

o Through bold statements such as “there’s not enough money in all of Chicago to make him approve of bad bookkeeping”, Andersen set the tone for the company à honesty above all

o = if Andersen approved a company’s financial records, then the public could rest assured that it has met all the necessary standards à brand promise

- in 1990s, began to erode its standards:

o Valued profit above integrity

o Willing to jeopardize the quality of its audits (i.e. approve of bad finances) for the purpose of keeping clients happy

§ destroyed, altered, and/or hid evidence for inadequate financial reports

- ENRON: committed fraud, ANDERSEN: hid the evidence against Enron

- in 2001→ truth = uncovered

o charged for obstruction of justice

- implications:

o destroyed both companies

o Enron no longer exists

o Andersen exists for the sole purpose of completing the litigation process

Unknown Types of Goods

• MRO: Maintenance, Repair and Operating Supplies
  • The basic supplies required to keep equipment running, the facility clean and general office supplies
• Work-in-progress: Materials which are incorporated in the product mid-way (chronologically not always) through the production phase. Like screws, bolts, decorative fabrics and pieces in furniture
• Perpetual Inventory Method: records and consistently updates inventory information

EXAM:

• 2011 ICDC Gal (87)