Intro to Business Management – Flashcards

Time-motion studies - helped researchers determine the most efficient ways of doing things Principle of motion economy - each job could be broken into elementary motions, each motion was analyzed to make it more efficient Limitations include: not taking into account the human and psychological aspects of work

They were surprising because the productivity kept going up, no matter what the experimenters did. It revealed that money is not the only motivator to an employee, there are other factors that motivate employees to be productive.People's tendencies to behave differently when they know that they're being studied.

Maslow said that motivations arises from need, and needs that are already satisfied no longer provide motivation. Maslow created a hierarchy of needs. Herzberg said there are factors called motivators that made employees productive and gave them satisfaction, usually relating to job content. He also said there were other elements that related to job environment which could cause dissatisfaction, but they wouldn't necessarily motivate if increased

Theory X = Managers have to watch carefully and tell employees what to do at all times. Theory Y = Managers are relaxed, workers are more free. Empowerment is a big part of Theory Y.

Idea that setting ambitious but attainable goals can motivate workers and improve performance if the goals are accepted, accompanied by feedback, and facilitated by organizational conditions. MBO helps implement the idea in the way that it helps employees motivate themselves using goals. Managers formulate goals in cooperation with everyone in the organization to commit the employees to their goals, and to monitor results and award accomplishment.

Managers could use the expectancy theory to motivate workers by making sure the reward is worth it. Effort depends on expectation of outcome. Make the reward worth the work. Personally sell 20 vehicles off a lot in one week, if you do, you get an all expenses paid vacation to Hawaii for a week. Can I accomplish it: Yes If accomplished what's the reward: Vacation Worth it: Yes

Baby boomers: born between 1946 and 1964, raised in families that experienced unprecedented economic prosperity, secure jobs, and optimism about the future. Generation X: born between 1965 and 1980, raised in dual career families with parents who focused on work. Generation Y: born between 1980 and 2000, raised by indulgent parents, most don't remember a time without cell phones, computers, and electronic entertainment.

A shift in employee attitudes toward work. Leisure time has become a much higher priority. As have flextime and a shorter workweek. Shortages of trained workers in growth areas such as computer technology, and the sciences. A decreased sense of employee loyalty, an increase in employee turnover, also having to pay the cost of replacing workers who have left

*the purpose of a performance appraisal: used by managers to determine whether their workers are doing an effective job *performance appraisal: an evaluation that measures employee performance against established standards in order to make decisions about promotions, competition, training, or termination *6 steps: 1) established performance standards 2) communicating those standards 3) evaluating performance 4) Discussing results with employees 5) taking corrective action 6) using the results to make decisions

flextime plans: gives employees some freedom to choose which hours to work, as long as they work the required number of hours or complete their assigned tasks compressed workweeks: an employee works the full number of hours, but in few than the standard number of days... ex: nurses job sharing plans: allows for two ore more part-time employees to share one full-time job

*workers that have illnesses and disabilities which do not impede on them doing their job, can not be discriminated against or terminated for this reason *legislation has restricted management's ability to terminate employees as the ADA increased workers' rights to their jobs

yellow dog contract: required employees to agree, as a condition of employment, not to join a union collective bargaining: process whereby union and management representatives negotiate a contract for workers s *Norris-LaGuardia Act, 1932: Prohibited courts for issuing injections against nonviolent union activities; outlawed contracts forbidding union activities; outlawed the use of yellow dog contracts by employers. **National Labor Relations Act (Wagner Act) 1935: Gave employees the right to from or join labor organizations (or to refuse to form or join); the right to collectively bargain with employers through elected union representatives; and the right to engage in labor activities such as strikes , picketing, and boycotts. Prohibited certain unfair labor practices by the employer and the union, and established the National Labor Relations Board to oversee union election campaigns and investigate labor practices. This act gave great impetus to the union movement. ***Fair Labor Standards Act, 1938: Set a minimum wage and maximum basic hours for workers in interstate commerce industries. The first minimum wage was 25 cents an hour, except for farm and retail workers. ****Labor-Management Relations Act (Taft-Hartley Act), 1947: Amended the Wagner Act; permitted states to pass laws prohibiting compulsory union membership (right-to-work laws); set up methods to deal with strikes that affect national health and safety; prohibited secondary boycotts, closed-shop agreements, and featherbedding (the requiring of wage payments for work not performed) by unions. This act gave more power to management. *****Labor Management Reporting and Disclosure Act (Landrum-Griffin act), 1959

Closed shop agreement: clause in a labor-management agreement that specified workers had to be members of a union before being hired (was outlawed by the Taft-Hartley Act n 1947) Open shop agreement: agreement in right-to-work states that gives workers the option to join or not join a union, if one exists in their workplace. union shop agreement: clause in a labor-management agreement that says workers do not have to be members of union to be hired, but must agree to join the union within a prescribed period. agency shop agreement: clause in a labor-management agreement that says employers may hire nonunion workers; employees are not required to join the union but must pay a union fee *Taft-Hartley Act made it no longer necessary for someone to be a part of a union to be hired.

UNION TACTICS: Strike: occurs when workers collectively refuse to go to work cooling-off period: workers return to their jobs while negotiations continue, to prevent a strike primary boycott: when labor encourages both its members and the general public not to buy products or services of a firm engaged in a labor dispute secondary boycott: an attempt by labor to convince others to stop doing business with a firm that is the subject of a primary boycott MANAGEMENT TACTICS: lockout: an attempt by management to put pressure on union workers by temporarily closing the business injunction: a court order directing someone to do something or to refrain from doing something strikebreakers: are workers hired to do the jobs of striking employees until the labor dispute is resolved (replacements)

Executive Compensation: the issue regarding how much the highest level executives and people in the company should be making, ranges from 20 to 400 times more than the lowest level workers Pay equity: (Equal pay act of 1964): act requiring companies to give equal pay to men and women who do the same job. Women earn 81% of what men earn. Sexual harassment: refers to unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature that creates a hostile work environment. (Civil Rights Act of 1961) Child Care and Elder Care: management must deal with providing their employee with the proper benefits and resources to care for either the elderly or their children. The cost of this to the business is very large and growing. Drug testing: The issue of deciding to whether or not to drug test before hiring a person for a job and conducting random drug tests, the issue mainly regards cost. Preventing drug use means preventing "lost work". Violence in the workplace: companies and management work to prevent problems from occurring before the act. Companies do not like the media's over exaggeration of violent acts in the work place.

The reason union membership has declined is because of the growth of the service sector. In order to regain prominence, unions will need to include more white-collar, female, and foreign born workers than in the past. Unions will need to assist management in employee relations.

Product) designing a want-satisfying product Price) setting a price for the product Place) putting the product in a place where people will buy it Promotion) promoting the product, including how "green" it is

It is important because it will allow you to instead of marketing your product all throughout the U.S., you can focus on just one or two regions where you will be the most successful. Geographic segmentation: study a group's values, attitudes, and interests and have your ad portray a lifestyle that appeals to a particular target group benefit segmentation: Determining which product benefits your target market prefers and using those benefits to promote a product volume (or usage) segmentation: separating the market by volume of product use, this can be used to design your promotions to better appeal to that specific group or groups

B2B deals with selling goods and services that will be used to produce other goods or services, consumer deals with goods or services used for personal consumption consumer includes households, B2B includes organizations and companies Less customers in the B2B market than there are in the consumer market consumer marketing occurs from advertising, B2B marketing occurs from personal selling.

Mass marketing means developing products and promotions to please large groups of people. Relationship marketing tends to deal with custom-made goods and services. (goal of relationship marketing is to keep their customers because of the individualized services and products that directly satisfy their needs

Define the problem or opportunity and determine the present situation Collect Data analyze the data choose the best solution

production era: marketing was largely a distribution function, the emphasis was on producing as many goods as possible and getting them to markets selling era: the emphasis was on selling and advertising to persuade consumers to buy the existing goods produced by mass production marketing concept era: when businesses recognized the need to be responsive to customers' needs customer relationship era: focusing on enhancing customer satisfaction and stimulating long-term customer loyalty

Total Product Offer- consists of everything consumers evaluate when deciding whether or not to buy something. Important elements for college: location. size. weather, majors offered. price. friends. family ties.

1. Convenience goods and services-products the consumer wants to purchase frequently with a minimum of effort 2. Shopping goods and services- products the consumer buys only after comparing value, quality, price, and style from a variety of sellers 3. specialty goods and services- consumer products with unique characteristics and brand identity 4. unsought goods and services-products consumers are unaware of, haven't necessarily thought of buying, or suddenly find they need to solve an unexpected problem. They differ based on the individual consumer, each consumer values things and prioritizes them differently based on numerous factors, such as age and location and market. convenience: candy, gum, milk, snacks, gas, banking services shopping: clothes, shoes, appliances, auto-repair services specialty: fine watches, expensive wine, fur coats, jewelry unsought: emergency car-towing services

Packing is used by companies to change and improve their basic product, example: squeezable ketchup bottles that stand upside down, paint cans withs screw tops, and integrated handles, packaged popcorn for microwave preparation

Brand: a name, symbol, or design, that identifies the goods or services of one seller or group of sellers and distinguishes them from the goods and services of competitors Brand name: consists of a world, letter, or group of words or letters that differentiates one seller's goods and services from others. Brand Equity: the value of the brand name and associated symbols

Utility: in economics, the want-satisfying ability, or value, that organizations add to goods or services Time utility: adding value to products by making them available when they're needed Business such as 7 eleven provide an option where resources such as food and drink are available around the clock, while internet may be more convenient, it can not provide these services as quickly as a local corner store Place utility: adding value to products by having them where people want them placing your business in a location that frequents visitors, where there are not other options, such as a 7 eleven along a road where there are not stores for miles at a time Possession utility: doing whatever is necessary to transfer ownership from one party to another; including providing credit, delivery, installation, guarantees, and follow-up service. Real estate brokers, banks that provide savings and loan allow people to use goods through renting or leasing without owning Information utility: adding value to products by opening two-way flows of information between marketing participants Newspapers, salespeople, libraries, websites, and government publications are information sources that provide information that aids us in making decisions Service utility: adding value by providing fast, friendly services during and after the sale and by teaching customers how to best use products over time Example: Apple's genius bar that allows customers in-store service and appointments that allow them to learn how to use their products and learn about other products

A wholesaler makes business-to-business sales of goods and services to businesses and institutions. Merchant wholesaler: independently owned firms that take title to the goods they handle Agents and brokers: bring together buyers and sellers and assist in negotiating an exchange. ***Difference: Agents and brokers ever own the products they distribute Three types: Rack jobbers: wholesalers that furnish racks or shelves full of merchandise to retailers, display products, and sell on consignment Cash and carry wholesalers: wholesalers that service mostly smaller retailers with a limited assortment of products drop shippers: wholesalers that solicit orders from retailers and other wholesalers and have the merchandise shipped directly from a producer to a buyer

intensive distribution: distribution that puts products into as many retail outlets as possible Ex: candy, cigarettes, gum, and popular magazines selective distribution: distribution that sends products to only a preferred group of retailers in an area Ex: appliances, furniture, and clothing (shopping goods) exclusive distribution: distribution that sends products to only one retail outlet in a given geographic area. Ex: luxury auto manufacturers

Corporate distribution system: one firms owns all the organizations in the channel of distribution. Contractual distribution system: members are bound to cooperate through contractual agreements. (Franchise systems (Mcdonalds), Wholesaler-sponsored chains (Ace hardware), Retail cooperatives(Associated Grocers) Administered distribution systems: A system in which producers manage all the marketing functions at the retail level Supply-chain management: process of managing the movement of raw materials, parts, work in progress, finished goods, and related information through all the organizations in the supply chain; managing return of these goods, and recycling materials when necessary

Logistics: the marketing activity that involves planning, implementing, and controlling the physical flow of materials, final goods, and related information from points of origin to points of consumption to meet customer requirements at a profit Issues: The mode of transportation for the goods, the cost of transportation, the speed by which the goods need to be delivered, how fragile the goods are, how often there are shipments. Different types of logistics: inbound logistics: the area of logistics that involves bringing raw materials, packaging, other goods and services, and information from suppliers to producers materials handling: the movement of goods within a warehouse, from warehouses to the factory floor, and from the factory to various workstations outbound logistics: the area of logistics that involves managing the flow of finished products and information to business buyers and ultimate consumers reverse logistics: the area of logistics that involves bringing goods back to the manufacturer because of defects or for recycling materials

I agree because since these intermediaries do not sell goods themselves, they must make up for this loss of possible revenue. The cost could be reduced if getting rid of the intermediaries because of not having to pay their costs.

Newspapers: A) Good coverage of local markets, able to be placed quickly; high consumer acceptance; ads can be clipped and saved. D) Ads compete with other features in paper, poor color; ads get thrown away with paper (short life span) Cable: A) Uses sight, sound, and motion; reaches all audiences; high attention with no competition from other material D) High cost; short exposure time; takes time to prepare ads. digital video recorders skip over ads Broadcast Tv- 36.8 billion Newspaper-23.4 Cable tv networks-27

Publicity: any information about an individual, product, or organization thats distributed to the public through the media and that's not paid for or controlled by the seller ***the talking part of sales promotion; it is information distributed by the media thats not paid for, or controlled by, the seller. Advantages: It may reach people who wouldn't read an ad, appear on the front page of a newspaper, be given air time on a tv news show. greatest advantage is its believability Disadvantages: Marketers have no control over whether, how, and when the media will use the story. Media will alter the image (positive or negative) and its perception to the public Advertising: limited to paid, non personal (not face to face) communication through various media by organizations and individuals who are in some way identified in the advertising message

Personal selling is the face to face presentation and promotion of products and services. It includes the search for new prospects and follow up service after the sale. Prospect/Qualify: researching potential buyers and choosing those most likely to buy... in the selling process, making sure that people have a need for the product, the authority to buy, and the willingness to listen to a sales message Pre-approach: Learn as much as possible about customers and their wants and needs. It is essential to learn as much as possible about customers Approach: giving an impression of friendly professionalism, create rapport, build credibility, and start a business relationship Make a presentation: matching the benefits of your value package to the client's needs Answer objections: Anticipate any objections the prospect may raise and determine the proper responses Close the sale: A question or statement that moves the selling process toward the actual purchase Follow up: handling customer complaints, making sure the customer's questions are answered, and quickly supplying what the customer wants. Differs: B2B personal selling is different because it does not need to focus on prospecting or qualifying. This is because the customer who came to the store is seen as being qualified to buy and interested in the product. The steps in this process are, A) Approach, B) Ask questions C) Make presentation D) Close sale E) Follow UP

Promotion Mix: The combination of promotional tools an organization uses... Advertising, personal selling, public relations, sales promotion ***all focused on the product Sales promotion: the promotional tool that stimulates consumer purchasing and dealer interest by means of short term activities coupons: free sample coupons in the mail sampling: offering samples at the store to give possible consumers a preview of the product premiums: offering possible deals to encourage purchases bonuses: partnerships with other products and brands to encourage purchases catalogs: putting advertisements in magazines that cater to people who would be interested in similar products

push strategy: promotional strategy in which the producer uses advertising, personal, selling, sales promotion, and all other promotional tools to convince wholesalers and retailers to stock and sell merchandise pull strategy: promotional strategy in which heavy advertising and sales promotion efforts are directed toward consumers so that they'll request the products from retailers

Viral marketing: the term now used to describe everything from paying customers to say positive things on the internet to setting up multilevel schemes whereby consumers get commissions for directing friends to specific websites Blogging: an online diary (web page) that looks like a web page but is easier to create and update by posting text, photos, or links to other sites Podcasting: a means of distributing audio and video programs via the internet that lets users subscribe to a number of files, also known as feeds, and then hear or view the material at the time they choose

Managerial accounting: provides information and analysis to managers inside the organization to assist them in decision making Functions of managerial: measuring and reporting costs of production, marketing, preparing budgets Financial Accounting: differs from managerial accounting in that financial information and analyses it generates are for people primarily outside the organization. Functions of financial: annual reports that show the organization's financial condition, progress, and expectations

Independent auditor's conduct evaluations and report based on an unbiased opinion about the accuracy of a company's financial statements. Their role is to audit accounting information and related records, write unbiased written report on their findings

A) Analyze source documents (sales slips, travel records, etc.) - Analyzing documents B) record transactions in journals- Recording information into journals C) transfer (post) journal entries to ledger- Posting that information into ledgers D) take a trial balance- developing a trial balance E) prepare financial statements (balance sheet, income statement, statement of cash flows) F) analyze financial statements

A journal is where the day's transactions are kept. Ledgers are used by bookkeepers to transfer information from accounting journals into. In ledgers, information about special accounts such as office supplies or cash is kept there.

Assets= Liabilities + Owners' Equity, this equation must always be balanced. This equation is the basis for the balance sheet. $50,000= 0 +$50,000

Current: Items that can or will be converted to cash within one year. Cash, accounts receivable, and inventory Fixed: assets that are relatively permanent such as land, equipment, and buildings Intangible: long-term assets that have no real physical form but do have value... patents, trademarks, copyrights

Balance Sheet: reports the firm's financial condition on a specific date Income Statement: Summarizes revenues, cost of goods, and expenses (including taxes), for a specific period and highlights the total profit or loss the firm experienced during that period Statement of Cash Flows: provides a summary of money coming into and going out of the firm. It tracks a company's cash receipts and cash payments.

LIFO: Last in, first out. whatever the price of inventory that was last brought in will be used FIFO: First in, first out. what the price of the first inventory purchased of a product was, this price will be used. the margin is greater using FIFO because the cost was less to buy the books

Ratio analysis: the assessment of a firm's financial condition, using calculations and financial ratios developed form the firm's financial statements Liquidity Ratio: how fast an asset can be converted to cash Leverage (debt) ratios: measure the degree to which a firm relies on borrowed funds in its operations. Profitability (performance) ratios: measure how effectively a firm's managers are using its various resources to achieve profits Activity Ratios (Inventory turnover ratio): measures the speed with which inventory moves through the firm and gets converted into sales

Profit on an income statement: the resources (revenue) that remain after everything is accounted for on the income statement are known as the net income (profit) or loss Cash balance reflected at the bottom of the statement of cash flows: the difference between cash at the beginning of the year and the end of the year, reflecting the sum of the 3 different activities that cash is provided from, (investing, operating, and financing)

Financial management is the job of managing a firm's resources so it can meet its goals and objectives. Financial mangers examine financial data that is prepared by accountants and recommend strategies for improving the financial performances of the firm. They also plan, budget, control funds, obtain funds, collect funds, conduct audits, mange taxes, and advise top management on financial matters.

A) forecasting the firm's short term and long term financial needs B) Developing budgets to meet those needs C) Establishing financial controls to see whether the company is achieving its goals.

operating (master) budget: ties together the firm's other budgets and summarizes its proposed financial activities. capital budget: highlights a firm's spending plans for major asset purchases that often require large sums of money, like property, buildings, and equipment. cash budget: estimates cash inflows and outflows during a particular period, like a month or quarter.

Trade Credit: the practice of buying goods and services now and paying for them later promissory note: a written contract with a promise to pay a supplier a specific sum of money at a definite time secured loan: a loan backed by collateral, something valuable such as property. unsecured loan: a loan that doesn't require any collateral line of credit: a given amount of unsecured short-term funds a bank will lend to a business, provided the funds are readily available revolving credit agreement: a line of credit that's guaranteed but usually comes with a fee commercial finance: organizations that make short-term loans to borrowers who offer tangible assets as collateral

Equity financing makes funds available when the owners of the firm sells shares of ownership to outside investors in the form of stock. IPO (Initial public offering): the first time a company offers to sell its stock to the general public retained earnings: the profits the company keeps and reinvests in the firm Venture capital: money invested in new or emerging companies that some investors

selling bonds and borrowing from individuals, banks, and other financial institutions. Bonds can be secured by some form of collateral or unsecured. The same is true of loans.

Leverage is borrowing funds to invest in expansion, major asset purchases, or research and development. Firms measure the risk of borrowing against the potential for higher profits.

bond: a corporate certificate indicating that a person has lent money to a firm (or a government) major elements: principal: face value (dollar value) of a bond, which the issuing company is legally bound to repay in full to the bond holder on the maturity date maturity date: the exact date the issuer of a bond must pay the principal to the bondholder interest: payment the bond issuer makes to the bondholders to compensate them for the use of their money

Advantages: -as owners of the business, stockholders never have to be repaid their investment -there's not legal obligation to pay dividends to stockholders: therefore, the firm can reinvest income (retained earnings) to finance future needs -selling stock can improve the condition of a firm's balance sheet since issuing stock creates no debt. (A corporation may also buy back its stock to improve its balance sheet and make the company appear stronger financially.) Disadvantages: -as owners, stockholders (usually only common stockholders) have the right to vote for the company's board of directions. (only one vote is granted for each share of stock). Issuing new shares of stock can thus alter the control of the firm -dividends are paid from profit after taxes and are not tax-deductible -they need to keep stockholders happy can affect manager's decisions

Investment bankers are specialists who assist in the issue and sale of new securities.

preferred stock: stock that gives its owners preference in the payment of dividends and an earlier claim on assets than common stockholders if the company is forced out of business and its assets sold common stock: the most basic form of ownership in a firm; it confers voting rights and the right to share in the firm's profits through dividends, if approved by the firms board of directors ***Holders of common stock have voting rights in the company. In exchange for having no voting rights, preferred stockholders receive a fixed dividend that must be paid in full before common stockholders receive a dividend. Preferred stockholders are also paid back their investment before common stockholders if the company is forced out of business.

investment risk: the chance than an investment will be worth less at some future time than its worth now. yield: the expected return on an investment, such as interest or dividends, usually over a period of one year duration: the length of time your money is committed to an investment liquidity: how quickly you can get back your invested funds in cash if you want or need them tax consequences: how the investment will affect your tax situations

blue-chip stocks: stocks issued by higher-quality companies, pay regular dividends and experience consistent price appreciation growth stocks: Stocks of corporations in emerging fields such as technology, biotechnology, or internet related firms, whose earnings are expected to grow at a faster rate than other stocks. potential for higher returns penny stocks: representing ownership in companies that complete in high-risk industries like oil exploration. income stocks: stocks of public utilities, usually offer investors a high dividend yield that generally keeps pace with inflation

Commercial Bank is a profit-seeking organization that receives deposits from individuals and corporations in the form of checking and savings accounts and uses these funds to make loans. Savings and Loan Associates is a financial union that accepts both savings and checking deposits and provides home mortgage loans. Credit unions are nonprofit, member-owned financial cooperatives that offer the full variety of banking services to their members.

Increase Reserve Requirements: Banks put more money into Fed, reducing money supply so there is less to lend, and slowing the economy Decrease Reserve Requirements: Banks put less money into Fed, increasing money supply so there is more to lend, and speeding the economy Fed Sells Bonds: Selling of bonds causes money to flow from the economy to the Fed, slowing the economy Fed Buys Bonds: Buying of bonds causes money to flow from the Fed to the economy, speeding the economy Increasing Discount Rate: Banks borrow less from the Fed, so there is less to lend, slowing the economy Decreasing Discount Rate: Banks borrow more from Fed, so there is more to lend, speeding the economy.

World Bank is primarily responsible for financing economic development, and it lends money to developing nations to improve their productivity and help raise the standards of living and quality of life. IMF is designed to oversee member countries' monetary and exchange rate policies. Goal is to enhance world trade by maintaining a global monetary system that works best for all nations.

EFT is a computerized system that electronically performs financial transactions such as making purchases, paying bills, and receiving paychecks. Tools and products include electronic check conversion, debit cards, smart cards, direct deposits, and direct payments.