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ลำดับตอนที่ #7 : [[R.S.]]General Business Test::Chapter.4 to 6::29.9.09

review sheet of General Business for

Chapter 4 - 6* 29.Sep.09

 

Chapter.4 :: Business Ethics and Social Responsibility  [[Page.52]]

Section 4.1 – Business Ethics [[Page.54]]

-          Ethics are moral principles by which people conduct themselves personally, socially, or professionally.

-          Business ethics are rules based on moral principles about how businesses and employees ought to conduct themselves.  

·         Most businesses are committed to providing safe products, creating jobs, treating their employees fairly, protecting the environment, and being truthful about their financial situation.

·         Unethical behavior of businesses make the customers pay more.

·         Different cultures, businesses, and industries have different ethical standards.

-          In business, people follow rules as well as a code of ethics.

·         A code of ethics is a set of guidelines for maintaining ethics in workplace.

-          Many unethical behaviors lead to the passage of legislation that makes those behaviors illegal.

-          A sweatshop is a shop or factory in which workers are employed for long hours at low wages and under unhealthy conditions.

-          The Occupation Safety and Health Administration (OSHA) sets & enforces work-related health and safety rules.

-          A code of ethics can cover issues such as employee behavior and environmental safety.

-          Unethical business practices include lying, offering merchandise known to be substandard, or treating customers or employees unfairly

·         Unethical business owners => go to jail

·         Unethical employees => fired or lose their licenses

-          Most businesses (especially small ones) rely on repeat customers & word of mouth to get new customers. So, the amount you make in profits from one unhappy customer may not be worth the lost business.

-          Treating employees unethically can also backfire, which means that you fire your old workers that you already teach them to work things out and your competitor hire them instead. So, your competitor has your well-trained employees who are much more efficient.

-           Another major ethical question that is generally not illegal relates to conflict of interest.

·         A conflict of interest is a conflict between self-interest and professional obligation.

-          When you encounter an ethical decision and must choose a course of action, ask yourself some important questions like are you sacrificing long-term benefits for short-term gains.

-          Some steps to take if you find yourself in an ethical dilemma are ..

1.        Identify the ethical dilemma (problem)

2.        Discover alternative actions

3.        Decide who might be affected

4.        List the probable effects of the alternatives

5.        Select the best alternatives

Section 4.2 – Social Responsibility [[Page.59]]

-          Business ethics focus on decisions considered good or bad, correct or incorrect.

-          Social responsibility is the duty to do what is best for the good of society.

·         Business that follow ethical standards value integrity and honesty in employees.

-          Some people believe that if a company produces goods that benefit society, it is fulfilling its social responsibility.

-          Some firms are very concerned about limiting the damage that they do to the environment.

-          Customers are a business’s first responsibility.

-          Businesses should offer a good, safe product or service at a reasonable price.

-          The Food and Drug Administration (FDA) is a federal government agency that protects consumers from dangerous or falsely advertised products.

-          Fair competition between businesses is necessary for the marketplace to operate effectively but some companies don’t care about it although it’s a major component for the marketplace.

-          One of the most common unethical tactics used to eliminate other companies is to conspire with them to control the market for a product.

-          When companies restrict competition, consumers are affected.

·         When the market changes or new market open up, a company can find itself unprepared to compete.

-          Some businesses provide work experience for people with limited job skills. (to develop their skills and confidence levels)

-          Volunteerism is another way businesses tackle societal problems.

-          Businesses have a social responsibility to provide employees with safe working conditions, equal treatment, and fair pay.

-          The government passed the Equal Pay Act to require that men and women to be paid the same wages for doing equal work. Another law is the Americans with Disabilities Act which bans discrimination against people with physical or mental disability.

-          One of the biggest social issues facing businesses today is environmental responsibility.

-          There is also Environmental Protection Agency (EPA), which enforces rules that protect the environment and control pollution.

-          Some behaviors (like inaccurate accounting records) are harmful to creditors – those who loan money – and outside shareholders – those who are owners but don’t work in business.

-          The Sarbanes-Oxley Act mandates truthful reporting and makes the CEO more accountable for the actions of the financials managers of a firm.

 

Chapter.5 :: Business Entrepreneurship  [[Page.74]]

Section 5.1 – Rewards and Challenges of Entrepreneurship [[Page.76]]

-          An entrepreneur is a person who recognizes a business opportunity and organizes, manages, and assumes the risks of starting and operating a business.

-          Entrepreneurship is the process of recognizing an opportunity, testing it in the market, and gathering the resources necessary to go into business.

-          Creating and running a business venture requires a variety of skills.

·         A venture is a new business undertaking that involves risk.

-          The Small Business Administration (SBA) created a checklist to help people see if they have the recommended traits for a career in entrepreneurship. Those traits include persistent, risk-taking, self-confident, restless, goal-oriented, action-oriented, responsible, self-demanding, creative, independent, inquisitive, and enthusiastic.

-          The SBA also defines a small business as an independently owned business that usually has owner as it manager and serves a limited geographic area & employs fewer than 500 people

-          A virtual business or dot-com company is a business that operates on the Internet. It makes shopping easier and more efficient. This shows how an entrepreneurial venture can make a significant improvement to what already exists.

·         Small businesses that use Internet have grown more than 45% than those that do not.

-          People become entrepreneurs because they want to …

·         Be the boss ((or have ability to be in charge of everything))

·         Do what they enjoy

·         Have the opportunity to be creative ((they’re able to shape a business in ways employees cannot))

·         Build an enterprise ((they must research the viability of the venture & choose form of business to start))

-          Many forms of business include …

·         Sole proprietorships = businesses are owned and operated by one person

·         Partnership = businesses are owned and run by two or more people

·         Corporation = businesses has many owners

-          Entrepreneurs enjoy developing their own schedule, run home-based businesses, make economic contribution to community through investment & creation of jobs, and they are rewarded for assuming risk.

-          Some challenges of entrepreneurship are

·         Getting funds to start the business (which is one of the biggest obstacles)

·         Being fully responsible for the business (need to make sure everything gets done on time)

·         Other challenges are feeling alone & insecure about making right decisions, long work hours, uncertain income levels, risks of failing, etc.

-          More than 99% of U.S. firms are small businesses, which are the principal sources of new jobs.

Section 5.2 – The Business Plan [[Page.82]]

-          If your market research shows that your business has the potential to succeed, then develop a business plan.

·         A business plan is a written description of a new business venture that describes all aspects of the business. 

-          A checklist is a good way to organize your thinking when u begin planning your own business.

-          A business plan must be well organized, easy to read and follow a logical format. There are 16 essential parts of all …

1.       Executive summary = a brief account of the key points contained in a business plan.

ð It should include most important information from each section of the plan.

2.       Management team plan = presents your qualifications and those of any partners you might have

ð Describes your team’s capabilities to execute your business concept

3.       Company description = provides an outlines of the business.

ð Describes the business opportunity and explains why the venture will succeed.

4.       Product and service plan = describe the product you want to offer

ð Spin-offs are additional products and services that you might offer when business is more established.

5.       Vision and mission statements = states the guiding principles by which a business functions

ð A vision statement establishes the scope & purpose of a company and reflects its values and beliefs.

ð A mission statement expresses the specific aspirations of a company, the major goals it will try to reach.  

6.       Industry overview = presents your research of the industry

ð Discuss trends and growth within the industry

7.       Market analysis = presents research about your customer profile

ð Include geographic, economic, and demographic data about the target market and business location.

8.       Competitive analysis = indicates how the proposed business has advantage over its competitors

9.       Marketing plan = discusses how a company makes its customers aware of its products or services

10.   Operational plan = includes the business processes that result in production and delivery of the product or service.

11.   Organizational plan = looks at the people who will run the firm as well as management’s philosophy along with the form of business organization that is chosen

12.   Financial plan = presents forecasts for the business. (data are shown here)

13.   Growth plan = looks at how the business will expand in the future

14.   Contingency plan = looks at likely risks to the business and suggests a way to minimize risk.

15.   Cover page, title page, table of contents

ð Cover page includes the company’s name, address, phone number, Web site & e-mail addresses, and logo.

ð Title page includes the company name; the names, titles, and addresses of the owners; the date the plan was submitted; and the name of its preparer.

ð Table of contents details the components of business plan

16.   Supporting documents = include exhibits and other information relevant to the business

 

Chapter.6 :: Business Ownership and Operation  [[Page.92]]

Section 6.1 – Types of Business Ownership [[Page.94]]

-          There are 3 main types of business organizations, each of them can change as business grows

Types	Definitions	Advantages	Disadvantages
Sole proprietorship	Business owned by one person	·Easy to start (need only a license or permit to start) ·Make all decisions & run the companies as they see it fits ·Sole owner keep all profits ·Income taxes are lower than corporation ·Income is taxed once and the tax rate is lower than corporation	· Has unlimited liability, meaning that the owner is responsible for the company’s debts · If dept is high than income, owner has to make up difference · Limited access to credit · Owner might not have all skills needed to run business · Ends when owner dies
Partnership	Business owned by two or more people who share its risks and rewards (needed of partnership agreement)	·Easy to start (need only to obtain license) ·Easier to obtain capital than sole proprietorship ·Each partner contributes money to start business ·Banks are more willing to lend money to ·Income is taxed only once ·Each partner brings different skills and talents to run a business	· All partners share risks · Problems occur when partners don’t get along or one decides to leave · Share unlimited legal and financial liability · One must responsible for the other’s bad decisions
Corporation	Company that is registered by a state & operates apart from its owner (needed corporate charter, a license to run corporation)	·Limited liability, which holds a firm’s owners responsible for no more than capital that they have interested in it ·ability to raise money when people buy stock ·doesn’t end if owner dies	·Pay taxes on their income and stock holders pay taxes on profits issued to them (this is called double taxes) ·Mare difficult and costly to start

-          There are other ways to organize a business venture too.

·         A cooperative is an organization that is owned and operated by its members.

·         A nonprofit organization, or nonprofit, focuses on providing service not to make profit.

·         A franchise is a contractual agreement to use the name and sell the products or services of a company in a designated geographic area. It offers a well-known name and a business plan.

Section 6.2 – Types and Functions of Businesses [[Page.99]]

-          One way to classify many different types of businesses is to group them by the kinds of activities they perform.

-          Type of businesses

·         A producer is a business that gathers raw goods (which are materials gathered in their original state from natural resources such as land or water)

·         A processor changes raw materials into more finished products.

ð Processed goods are made from raw goods that require further processing.

·         A manufacturer is a business that makes finished products out of processed goods.

ð They turn raw or processed goods into finished goods

·         An intermediary is a business that moves goods from one business to another. It buys goods, stores them, and then resells them.

·         A wholesaler (or distributors) distributes goods. They divide large quantities into smaller ones and sell them to retailers.

·         A retailer purchases goods from a wholesaler and sells them to consumers, the final buyers of goods. 

-          Some businesses meet needs, some provide conveniences, etc.

-          There are 5 main functions involved in the operation of all types of businesses.

1.       Production = process of creating, expanding, manufacturing, or improving goods and services.

Procurement = buying and reselling of goods that have already been produced.

2.       Marketing = process of planning, pricing, promoting, selling, distributing ideas, goods, services (involves getting consumers to buy a product or service)

3.       Management = process of achieving company goals by planning, organizing, leading, controlling, and evaluating the effective use of resources.

4.       Finance = the business or art of money arrangement

5.       Accounting = involves maintaining and checking records, handling bills, and preparing financial reports for a business.

-          The functional areas of business depend on each other.

·         Sometimes they conflict with one another.

·         Companies benefit when all functional areas work together.

 

Ps. I try to maintain the pages up to only five and it’s successful …

Good luck in the GB test everyone ^_^



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