2. Learning Goals
1 Distinguish between business and not-for- 5 Explain how today’s business
profit organizations. workforce and the nature of work
itself is changing.
2 Identify and describe the factors of
production. 6 Identify the skills and attributes
managers need to lead businesses
3 Describe the private enterprise system, in the 21st century.
including basic rights and
entrepreneurship. 7 Outline the characteristics that make
a company admired by the business
4 Identify the six eras of business, and community.
explain how the relationship era—
including alliances, technology, and
environmental concerns—influences
contemporary business.
3. W is Business?
hat
s Profit-seeking activities and enterprises provide
goods and services necessary to an economic
system.
s Profit-seeking is the reward for business people
who take the risk involved to offer goods and
services to customers.
s See Fortune 500 for a list of major U.S.
companies.
4. Factors of Production
s Natural Resources
s Capital
s Human Resources
s Entrepreneurship
s Occupational Outlook Handbook
5. The Private Enterprise System
s Capitalism
s Adam Smith is the father of capitalism.
s “Invisible Hand”
s Economic system determines business
ownership, profits, and resources
s Rewards firms for their ability to serve the needs
of consumers
s Minimized government intervention
s Competition is the battle among businesses for
consumer acceptance.
7. Entrepreneurship
An Entrepreneur:
Entrepreneurial thinking is
s Is a risk-taker
s Takes financial, personal, important within large firms.
social, and career risks
s Sees a potentially profitable
opportunity
s Devises a plan to achieve
success in the marketplace
and earn those profits
s Fuels the U.S. economy
s Provides innovation
9. Managing Relationships through
Connections
s Relationship Management
s Activities to build and maintain mutually
beneficial ties with customers and other parties
s Relationship management depends
on technology.
10. Strategic Alliances and Partnerships
s A partnership is an affiliation of two or
more companies that help each other
achieve common goals.
s A strategic alliance is a partnership
formed to create a competitive advantage
for both parties (see Amazon).
11. Today’s Business Workforce
s Dedicated workers who can foster strong
ties with customers
s Capable of high-quality production
s Able to compete in global markets
s Technically savvy
12. Changes in the W orkforce:
Aging Population
s By 2030, the number of U.S. workers 65 or
older will reach 72 million.
s Many baby boomers are hitting the peak of
their careers, while Generations X and Y are
launching their careers.
s Technology has intensified the hiring
challenge by requiring workers to have ever
more advanced skills.
s U.S. Census Bureau
13. Changes in the W orkforce:
Shrinking Labor Pool/Diversity
s Economists predict the U.S. labor pool could
soon fall short by as many as 10 million
people.
s The two fastest-growing ethnic populations in
the United States are Hispanics and people of
Asian origin.
s Employee teams with individuals of different
genders, ethnic backgrounds, cultures,
religions, ages, and physical and mental
abilities are more effective.
14. Changes in the Workforce:
Outsourcing
s Outsourcing is using outside vendors to
produce goods or fulfill services and functions
that were previously handled in-house or in-
country.
s Offshoring is the relocation of business
processes to lower-cost locations overseas.
15. Changes in the W orkforce:
Innovation through Collaboration
s Younger workers are looking to something
other than work-comes-first
s Telecommuting and job-sharing
s Part-time and temporary workers are growing
s Collaboration is replacing working alone
s Value risk-taking and innovation
17. Critical Thinking and Creativity
s Critical thinking is the ability to analyze and
assess information to pinpoint problems or
opportunities.
s Creativity is the capacity to develop novel
solutions to perceived organizational
problems.
18. Ability to Lead Change
s Guide employees and organizations through
changes
s Managers must be comfortable with tough
decisions.
s Factors that require organizational change
can come from external and internal sources.
19. W Makes a Company Admired?
hat
s Solid profits
s Stable growth
s Safe and challenging work environment
s High-quality goods and services
s Business ethics and social responsibility
s Fortune’s list of Most Admired Companies
20. The Future of Business
s New Technologies
s Population Shifts
s Emerging nations
s Shrinking Global Barriers
s Trade, communication, transportation
