Karteikarten
IB Business Management 1.6
Karten in diesem Stapel (33)
- 1scale of operationthe maximum output that can be achieved using the available inputs (resources)- this scale can only be increased in the long term by employing more of all inputs
- 2economies of scalereductions in a firm's unit (average) costs of production that result from an increase in the scale of operations
- 3Types of economies of scale1. Purchasing (bulk-buying)
2. Technical (flow production lines, advanced tech equipment)
3. Financial (bank preference, public issuing of shares)
4. Marketing
5. Managerial (specialist managers) - 4Diseconomies of scalefactors that cause average costs of production to rise when the scale of operation is increased
- 5Types of diseconomies of scale1. Communication problems (poor decisions, management inefficiency)
2. Alienation of the workforce (less sense of purpose, feel insignificant)
3. Poor coordination and slow decision-making - 6Merits of small organizations on economies-jobs created
-run by innovative entrepreneurs
-creates competition for larger businesses
-supply specialist goods and services
-all great businesses started off small
-lower average costs than larger economies - 7Reasons to grow businesses-increase profits
-increase market share
-increase economies of scale
-increase power and status of owners and directors
-reduced risk of being a takeover target - 8Internal growthopening new branches, shops or factories (also known as organic growth)
- 9external growthbusiness expansion by merging or taking over another business, from either the same or different industry
- 10Backwards vertical integration vs forward vertical integrationBackwards: same industry, towards business's suppliers
Forwards: same industry, towards business's customers - 11Horizontal integration vs conglomerate diversificationHorizontal: same industry, same stage of production i.e. rival company
Conglomerate: different industry i.e. appliance company buys out an auto manufacturer - 12Mergeragreement by managers and shareholders of 2 companies to bring both firms under a common board of directors with shareholders in both businesses owning shares in the newly merged business
- 13Takeoverwhen a company buys over 50% of the shares of another company and becomes the controlling owner- often called 'acquisition'
- 14Joint venturetwo or more businesses agree to work closely together on a particular project and create a separate division to do so
- 15Strategic allianceagreements between firms in which each agrees to commit resources to achieve an agreed set of objectives
- 16Franchisea business that uses the name, logo and trading systems of an existing successful business
- 17Pros, cons, stakeholder impacts of horizontal integrationPROS: eliminates a competitor, possible economies of scale, rationalization, increased power over suppliers CONS: rationalization can lead to bad publicity, monopoly SI: consumers less choice, worker job security
- 18Pros, cons, stakeholder impacts of forward vertical integrationPROS: business able to control pricing and promotion of its own products, secures outlet that can exclude competitors' products CONS: consumers suspicion, lack of experience in this sector SI: greater job security, varied career opportunities, consumers resent lack of competition& choice in retail outlet
- 19Pros, cons, stakeholder impacts of backward vertical integrationPROS: control over quality, price and delivery times, encourages joint research and development, control supplies of materials to competitors CONS: lack of experience, supplying business complacent SI: career opportunities, improved quality for customers, limit of choice for customers
- 20Pros, cons, stakeholder impacts of conglomerate integrationPROS: diversifies the business away from original industry and markets, spread risk, enter a faster growing market CONS: lack of experience, lack of clear focus and direction
SI: career opportunities for workers, job security as risks spread across more than one industry - 21Advantages of joint ventures- costs and risks of a new business venture are shared (high costs for developing new products)
-different companies have different strengths
-might have major markets in different countries and can exploit these - 22Risks of joint ventures-styles of management and culture might clash
-errors and mistakes can cause blame
-business failure of one partner would put the whole project at risk - 23Strategic alliance types (examples)with a university: finance provided by a business to allow new specialist training courses to increase suitable staff
with supplier: design and produce components and materials for new products
competitor: reduce risks of entering a new market - 24Pros and cons of franchisesPROS: less chance of failing, advice and training from franchiser, national advertising, supplies from established and quality-checked suppliers, franchiser agrees not to open another branch in the area
CONS: share of sales paid to franchiser, expensive initial license fees, reduced control - 25globalisationthe growing trend towards worldwide markets in products, capital and labor that is unrestricted by barriers
- 26free tradeno restrictions on trade barriers exist that might prevent or limit trade between countries
- 27protectionismusing barriers to free trade, such as tariffs and quotas, to protect a country's own domestic industries
- 28Benefits of globalisation-consumers offered more choice
-imports of raw materials allow developing economies industrialize
-competition for domestic industries
-comparative advantage (specialization)
- increase foreign investment, bigger pool of skilled labor - 29multinational company or businessbusiness organization that has headquarters in one country, but with operating branches, factories and assembly plants in other countries
- 30Why become multinational?-closer to main markets
-lower cost of production (labor, operations, government incentives)
-avoiding import restrictions
-access to local natural resources - 31Potential problems for multinationals-communication
-language
-legal requirements
-cultural differences
-coordination with other plants across organization
-skill level and training requirements - 32Benefits of multinationals on 'host' countries-bring foreign currency, foreign exchange
-employment opportunities
-local firms can supply services
-local firms bring their quality and productivity up to international standards
-tax revenues to the government
-total output of the economy will increase - 33Drawbacks of multinationals on 'host' countries-exploitation of the workforce, lack of strict health and safety rules, cheap labor
-pollution
-local firms at risk
-imposing 'western' culture
-profits sent back to HQ country
-depletion of natural resources
Informationen
- Beschreibung
- Karteikarten am IB Business Management 1.6, erstellt von One Fish Two Fish am 19/01/2020.
- Erstellt von
- One Fish Two Fish
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