INTRODUCTION TO BUSINESS MANAGEMENT
What is business management?
Globalization, Mindsets, Culture, Economies of Scale, Complex & Dynamics
Globalization: 4 points of view( pro-globalists, anti-globalists, skeptics,
How about a working definition?
- Defined as the art and science of getting things accomplished though
others in organizations
- Different ROLES of management:
First level: mobilization
Second (middle): coordination
Third level: strategic
BUSINESS: all profit-seeking activities and enterprises that provide goods
and services necessary to an economic system
PROFITS: rewards for businesspeople who take the risks involved to offer
goods and services to customers.
FACTORS OF PRODUCTION: four basic inputs for effective operation:
natural resources, capital, human resources, and entrepreneurship.
The four factors of production is important because firms need to understand
how to lower the cost of (and optimize) production if they are going to be main
profitability and sustainability.
Natural resources: all production inputs that are useful in their natural states,
including agricultural land, building sites, forests, and mineral deposits.
Capital: production inputs consisting of technology, tools, information, and
physical facilities. Human resources: production inputs consisting of anyone who works,
including both the physical labour and the intellectual inputs contributed by
Entrepreneurship: the willingness to take risks to create and operate a
THE PRIVATE ENTERPRISE SYSTEM
Private Enterprise System: an economic system that rewards firms for their
ability to identify and serve the needs and demands of customers. Also known
Adam Smith known as Father of Capitalism
“Invisible hand” (Adam Smith) versus “visible hand” (Chandler):
Invisible hand: Market; Visible hand: Management
The idea of the “invisible hand” is a basic principle of the private enterprise
Economic system determines business ownership, profits, and resources.
Firms rewarded for their ability to serve the needs of consumers.
A private enterprise economy MAXIMIZES indi