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1.1 Introduction to
Business
Management
Role of Business
Input Process Output
Business
Businesses exist to satisfy the needs and wants of people, organizations and
governments
Market Customers
Market
...
Adding Value
Adding value is increasing price of the products by improving
packaging or adding features
It leads to profit...
Opportunity Cost
This next best alternative foregone while making a choice is known
as Opportunity Cost
Because of the fac...
Division of labor
The separation of a work process into a number of
tasks, with each task performed by a separate
person o...
Business Functions
 Human Resources
(Personnel)
 Marketing
 Finance
 Production
(Operations)
Human Resources
 Manpower Planning
 Job analysis and Job
description
 Determining wages and
salaries
 Recruitment and ...
Marketing
 Conducting Market
Research
 Price Planning
 Customer Relationship
Management
 Identifying New Business
Oppo...
Finance
 Advice on the financial and tax implications of
business decisions
 Management of wages
 Raising Finance
 Pre...
Production
 Production and planning
 Purchasing department
 Stores department
 Manufacture of products
 Design and te...
Business sectors
Primary Tertiary
Secondary
Quaternary
Primary sector
 Larger sector in underdeveloped &
developing countries
 Less capital investment
 Less use of machinery
...
Secondary sector
 Takes the output of the primary sector and
manufactures finished goods
 Important sector to promote ec...
Tertiary sector
 Significant contribution to GDP in developed
countries
 Provides key inputs to most other business
 Tr...
Quaternary Sector
The portion of an economy that is based on knowledge
applicable to some business activity that usually
i...
Sectoral change
Refers to a shift in the GDP contribution from primary
sector to secondary and tertiary sector
Reasons for sectoral change
 Cultural Changes
 Development of Markets
 Market orientation
 Rampant migration
 Focus o...
Benefits of sectoral change
 Creation of more jobs
 Gradual movement towards Tertiary sector
 High capital investment t...
Role of Entrepreneurship
 Bringing together the factors of production
 Contributes towards growth of
economy
 Reduces u...
Intrapreneurship
Giving opportunity to a person within a large
corporation to take direct responsibility for turning an
id...
Start-up cost of business
 Premises
 Buildings
 Capital equipment
 Marketing costs
 Legal and professional fees
Factors to consider when setting
up business:
 Business idea
 Finance
 Human resources
 Entrepreneurial skills
 Fixed...
Reasons for starting business
 Growth
 Earnings
 Autonomy
 Security
 Hobbies
Challenges of start-up business
 Obtaining Finance
 Market potential
 Cash flow problems
 Customer Loyalty towards oth...
Elements of Business Plan
1.1 introduction to business management
1.1 introduction to business management
1.1 introduction to business management
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1.1 introduction to business management

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1.1 introduction to business management

  1. 1. 1.1 Introduction to Business Management
  2. 2. Role of Business Input Process Output
  3. 3. Business Businesses exist to satisfy the needs and wants of people, organizations and governments Market Customers Market place
  4. 4. Adding Value Adding value is increasing price of the products by improving packaging or adding features It leads to profit making by allowing a business to sell its products for more than its production costs
  5. 5. Opportunity Cost This next best alternative foregone while making a choice is known as Opportunity Cost Because of the fact that choice involves opportunity cost, the factors of production have to be used in the most efficient way and therefore SPECIALIZATION
  6. 6. Division of labor The separation of a work process into a number of tasks, with each task performed by a separate person or group of persons.
  7. 7. Business Functions  Human Resources (Personnel)  Marketing  Finance  Production (Operations)
  8. 8. Human Resources  Manpower Planning  Job analysis and Job description  Determining wages and salaries  Recruitment and Selection  Training and Development  Employee welfare and motivation  Labour management relations  Performance Appraisal
  9. 9. Marketing  Conducting Market Research  Price Planning  Customer Relationship Management  Identifying New Business Opportunities  Product Planning  Distribution Planning  Consumer Analysis
  10. 10. Finance  Advice on the financial and tax implications of business decisions  Management of wages  Raising Finance  Preparation and monitoring of annual budgets and forecasts
  11. 11. Production  Production and planning  Purchasing department  Stores department  Manufacture of products  Design and technical support department
  12. 12. Business sectors Primary Tertiary Secondary Quaternary
  13. 13. Primary sector  Larger sector in underdeveloped & developing countries  Less capital investment  Less use of machinery  Agriculture constitutes the major part
  14. 14. Secondary sector  Takes the output of the primary sector and manufactures finished goods  Important sector to promote economic growth and development  Important source of income in developing countries
  15. 15. Tertiary sector  Significant contribution to GDP in developed countries  Provides key inputs to most other business  Transformation of goods through providing services
  16. 16. Quaternary Sector The portion of an economy that is based on knowledge applicable to some business activity that usually involves the provision of services Examples: Consultancy (offering advice to businesses) and R&D (research, particularly in scientific fields)
  17. 17. Sectoral change Refers to a shift in the GDP contribution from primary sector to secondary and tertiary sector
  18. 18. Reasons for sectoral change  Cultural Changes  Development of Markets  Market orientation  Rampant migration  Focus on customer relationship management
  19. 19. Benefits of sectoral change  Creation of more jobs  Gradual movement towards Tertiary sector  High capital investment towards Government  Increase in country’s GDP  Decrease in imports & increase in exports
  20. 20. Role of Entrepreneurship  Bringing together the factors of production  Contributes towards growth of economy  Reduces unemployment
  21. 21. Intrapreneurship Giving opportunity to a person within a large corporation to take direct responsibility for turning an idea into a profitable finished product through assertive risk-taking and innovation
  22. 22. Start-up cost of business  Premises  Buildings  Capital equipment  Marketing costs  Legal and professional fees
  23. 23. Factors to consider when setting up business:  Business idea  Finance  Human resources  Entrepreneurial skills  Fixed assets  Suppliers  Customers  Marketing  Legalities
  24. 24. Reasons for starting business  Growth  Earnings  Autonomy  Security  Hobbies
  25. 25. Challenges of start-up business  Obtaining Finance  Market potential  Cash flow problems  Customer Loyalty towards other brands  Regulations  Finding the right staff  Uncertainty
  26. 26. Elements of Business Plan

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