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1.1 Introduction to Business Management (role of entrepreneur…
1.1 Introduction to Business Management
Role of business
Consumer services
Capital goods
Consumer goods
Business inputs
Labour
temporary/permanent
manual and skilled labour
Capital
finance
capital goods
factories/offices
Land
raw materials
site for buildings
Enterprise
risks-takers
decision makers
coordinators
Define
business
any organization that uses resources to meet the needs of customers by providing a product or services that they demand.
Business functions
Finance and accounts
analysing account
provide financial information
monitor flow of finance in and out
Marketing
concerns about price and promotions and products
do market research and analysis
Human resource management
manage human resource to
help achieve missions in business
provides motivational system to retain workers
recruits/trains employees
Operations management
inputs/outputs in productions
service industries, traditional manufacturing
Definition: Resources such as people, raw materials finance that are put into a system to obtain a desire doutput.
Why start a business?
desire for independence
wishing to make more money than current job
job loss
economic sectors
secondary sector
firms that manufacture products from natural resources; construction, brewing
tertiary sector
firms that provide services to the consumers and other business; retailing, transport, insurance
primary sector
firms that extract natural resources; farming, fishing
quartenary sector
sector that is focused on IT business an information service provider; business conculting, R&D, information gathering, website design
role of entrepreneur
entrepreneur; someone who takes the financial risk of starting and managing a new venture
innovative
commitment and self-motivation
multi-skilled
leadership skilled
belief in oneself
risk-taker
Intrapreneurs
someone who helps in developing business such as making investments but do not take the risk of failure
Impact of enterprise on business activity
economic growth
gross domestic product of country will increase when output of goods or services from a start-up business increase
firm's survival and growth
some firms survive and expand to become really important busines although a high proportion of new firms fail
employment creation
self-employment
employ others too
innovation and technological change
the higher the usage of IT in a business, the higher the chance for the business to become more advanced and success thus competetive
common steps in starting up a business or enterprise
problems faced by start-ups
competition
lack of record-keeping
lack of finance and working capital
poor management skills
changes in the business environment
identifying market opportunities
determining a location
building a customer base
sourcing capital (finance)
business plans
importance of business plans
to ensure the success of marketing strategies
can aim for the targets of financial and other forecasts contained in the plan
obtain finance for the business start-up
contents of a business plan
management team personnel
operations; premises to be used, production facilities
marketing and sales strategy
financial forecasts
description of business opportunity
executive summary; overview and strategy of new business
users of business plans
allows potential investors in the new business
financial forecasts can act as budget for the internal stakeholders; managers
employees will give focus to their work, which aids motivation