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What is business? & Understanding management and leadership styles…
What is business? & Understanding management and leadership styles 1&2
Public limited company
shares on public stock market, many shareholders, detailed disclosure of info, costly to administer. shares may be quoted
Private limited company
most popular form incoroprated business, privately owners, shares cannot be traded publicly, 1 or less shareholders, quick and easy set up to administer
Market Capitalisation
total market value of issued share capital of company
Share Capital
returns dividend and capital growth, part of ownership, LT source of finance, higher returns given higher risk, can be repaid
Debt
most common form of loans and overdrafts, return interest on amount loaned and outstanding, repaid over agreed period, ST/LT, no participation in ownership of company, often secured against assets of company
Floatation
on stock exchange, opp of existing shareholders to realise profits on their investments, costly and time consuming
Rights Issue
new shares to existing shareholders, right to subscribe new shares discount to existing share price
Unlimited Liability
business owners personally responsible for debt and liability of business, if failed owner liable amounts owed
Sole Trader
most common business structure, individual owning of business, can employ people don't share ownership, assets personally at risk and responsible for debts
Limited Liability
important protection for shareholders, can only lose the value of their investment, not protect or fraud trading
Limited company
separate legal entities to founders, own things itself can/be sued, owned by shareholders and run by directors (shareholders appoint directors) shareholder not own any assets of company or liable for any debts. Company owns assets and pays debts.
Public Sector Organisations
business provide goods and services which benefit community
Unincorporated business
owner is the business no legal difference, owner has unlimited liability for actions, sole trader
Incorporated business
legal difference business and owner, limited liability for actions
Traditional leadership
command and control, decision making Theory X
Modern Leadership
inspiring employees, creating vision, share core values, building effectiveness Theory Y
Autocratic
focus on power with manager, communication top down, use of rewards and penalties, little delegation
Demographic
focus of power with group as whole, leadership shared with group, employees greater involvement
Paternalistic
leader decided whats best for employees, little delegation, links with Mayo
Laissex-faire
little input day to day running decisions, effectives when staff ready and willing take responsibility