Nature and Purpose of Business org.pptxx.
- 2. A business is usually defined as a commercial enterprise Some are run by only one person who carry out all of the required functions Others employ thousands of people and provide goods and services to people all over the world Each business can be defined or described by its type of ownership, the goods produced or services offered, the types of jobs provided, or the functions it performs in a community
- 3. Businesses are started by entrepreneurs who see a need, recognize the opportunity, and go into business to meet that need Business and people need each other – there are many stakeholders – we depend on businesses for products and services, but also for employment Buy inputs – raw materials, labour, machinery and equipment, and land Produce outputs – goods and services Focus on efficient use of resources Generate profit/surplus
- 4. Who are the stakeholders? – Anyone who has an interest in the success of a business • Customers • Managers • Employees • Owners • Local Community/Environment • Suppliers • Government • Creditors
- 5. Take Inputs Process/Manufacture Output Costs – Fixed and Variable Revenue Profit
- 6. A group of businesses that all produce similar products is called an industry Example: Automobile manufacturers and automobile parts is the Automobile Industry Separated into three categories – primary, secondary, and tertiary
- 7. • Those involved in the first stage of development of products • Harvest natural resources that are later used to manufacture products • Mining, fishing, agriculture, forestry, and oil and gas extraction are all primary industries • Large amounts of money is needed for research, equipment and machinery • Automation reduces the need for labour Primary Industry
- 8. • Manufacture raw materials into finished products • Gold and silver ores are refined and made into jewellery • Crude oil is refined into machine oil, gasoline, and plastics • Wheat is milled into flour and baked into breads and cookies • Technology innovations has led to automation with computer assisted design • Production is increasing using fewer workers Secondary Industry
- 9. • Provide services to consumers and other businesses • Often involves selling or using products produced by secondary industries • Tertiary industries are rapidly expanding creating job opportunities in service occupations • Due to advances in technology (including electronics, communications, and computer science and aerospace), an aging population, busy consumers with less free time, and consumer demand for higher quality services Tertiary Industry
- 11. Internal and External Influences Marketing Objectives and Strategy Human Resources Production and Operations Management Accounting and Finance External Factors Market Analysis • Market Size • Market Segments Marketing Strategy • Objectives of Business • Niche versus Mass Marketing • Marketing Portfolio Market Research • Primary and Secondary The Marketing Mix • Price • Place • Promotion • Product
- 12. Internal and External Influences Objectives and Strategy Human Resources Production and Operations Management Accounting and Finance External Factors Marketing Legal Structure • Sole Proprietor • Partnership • Corporation Business Objectives • Mission Statements • Starting Business Stakeholders • Customers • Suppliers • Employees • Communities SWOT Analysis • Strengths, Weaknesses, Opportunities, andThreats
- 13. Internal and External Influences Human Resources Production and Operations Management Accounting and Finance External Factors Marketing Objectives and Strategy Management Structure and Organizational Design • Top Managers, Middle Managers, Front Line Managers • Operatives Leadership and Management Styles • Autocratic, Democratic, Laissez-Faire Management by Objectives (MBO)
- 14. Internal and External Influences Human Resources Production and Operations Management Accounting and Finance External Factors Marketing Objectives and Strategy Motivation Recruitment and Training of Employees Workforce Planning Communication
- 15. Internal and External Influences Production and Operations Management Accounting and Finance External Factors Marketing Objectives and Strategy Human Resources Efficiency and Effectiveness • Stock and QualityControl • Capacity Utilization Production Methods Economies and Diseconomies of Scale
- 16. Internal and External Influences Accounting and Finance External Factors Marketing Objectives and Strategy Human Resources Production and Operations Managemen t Profit and Loss Break Even Point Balance Sheet Budgeting Revenue
- 17. Internal and External Influences External Factors Marketing Objectives and Strategy Human Resources Production and Operations Management Accounting and Finance Market Structure • Perfect Competition • Monopoly • Imperfect Competition • Oligopoly The Macro-Economy • Business Cycles • Government Objectives and Policies The Legal Environment (The Law) Social Responsibility Business Ethics