what is business

• business definition


  an organisation that exists to provide goods and services on a commercial basis to customers
• start up definition

  a new business enterprise formed by one or more entrepreneurs
• entrepreneur

  a person who sets up a business taking on financial risk in the hope of profit
• why does business exist?

  to provide goods and services on a commercial basis to customers
• what are the benefits of business to society?

  1. create employment 2. drive innovation. 3. tax (on profits). 4. create wealth by providing returns on investment
• what is the role of the entrepreneur?

  1. spots business opportunities 2. takes calculated risks in order to gain possible future returns 3. acts as a catalyst for the creation and growth of new business enterprises
• what is the transformation process?

  where value is added to inputs to create outputs.
• what are the four key inputs into the transformation process?

  land, labour, capital and enterprise
• what is the primary sector?

  grows goods and extracts materials
• what is the secondary sector?

  manufacturing a product
• what is the tertiary sector?

  providing a service
• what is the quaternary sector?

  information services
• what are business objectives?

  helps to achieve aims, the intended outcomes of business strategy
• what are the main functions of objectives?

  a clear statement of what needs to be achieved, a means of measuring performance
• what factors can influence business objectives?

  age of business, market conditions, competition, state of economy
• most corporate objectives will refer to:

  profit, return on investment, cash flow, sales revenue, corporate image and reputation
• how can objectives be used?

  provide clear focus for decision making, motivate employees, reduce uncertainty, provide a target
• strategic objectives (LT)


  set by the board, involve higher risk, long term, involve high investment, strengthening and challenging, difficult to change in the short term
• tactical objectives (ST) 


  set by middle management, involve low risk, short term, limited resources invested, realistic and achievabl, relatively easy to change
• what are the SMART objectives?


  specific

  measurable

  achievable

  relevant

  time bound