BUSINESS AND MANAGEMENT MODULE 1 BUSINESS ORGANIZATIONS & ENVIRONMENT

Business Stakeholders  Various groups of people have an interest in business –Managers –Owners or shareholders –Employees –Customers –Suppliers –Government –The community

Owners  The business is the property of the owner  Owners will differ greatly in their decision making ability and job function

Discussion  Can you think of the job functions of the owner of a small watch repair shop?  Think!  Pair!  Share!

Owners (continued)  Owners of large corporations (called shareholders) have a very small role in the business function of the corporation  In fact, shareholders may not have any say at all in the day-to-day operations of the business  The more shares of a business you own, the more control you have over the business

Managers  An individual who is accountable for more work than he or she could undertake alone –Organizing and decision making –Planning and control –Accountability –Entrepreneurial role

Employees  Role of an employee tends to be of following the instructions of the employer  Employees assist in carrying out the business activity  Wages are paid as a reward for following the terms of employment  The amount paid depends on a number of things like seniority, qualifications, nature of the job etc

Customers  Not part of the business, but vital to its success  Businesses must understand the needs of its customers, and produce the goods or provide services that the customer wants  Customers and consumers are not the same –Consumers ultimately “consume” the product –Customers may resell the product (may be other businesses)

Suppliers  Provide the resources which allow businesses to produce good and services  Good relationships must exist between supplier and business  Laws of interdependence –A business’ dependency on other businesses to provide materials and supplies in order to satisfy customers needs and wants

Government  Influences business in a number of ways –Legislation  Laws that dictate what can be sold and to whom –Economic policies  Interest rates and tax rates –Subsidies and grants  Start up money or initiatives for hiring visible minorities

Stakeholder Conflict  Businesses need to make decisions that will address the interests of some stakeholders, but at the expense of not being able to meet the needs of others –If owners want more profit, the resulting action may be staff reduction  Should some stakeholders have more of a say in management and direction?

Mini Case Case: Highland Bus Company Source: Jones, Hall, Raffo, Business Studies 3 rd Edition, Unit 3, page 25