1. Change is the Only Constant
Chapter 1: Business Now
Change is the Only Constant
Copyright © 2014 by Nelson Education Limited 1 1

2. Looking Ahead
LO1 Define business and discuss the role of business in the economy
LO2 Explain the evolution of modern business
LO3 Discuss the role of not-for-profit organizations in the economy
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 2 2

3. Looking Ahead
LO4 Outline the core factors of production and how they influence the economy
LO5 Describe today’s business environment and discuss each key dimension
LO6 Explain how current business trends might influence your career choices
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 3

4. LO1 Business Now: Moving at Breakneck Speed
In the last decade, the players, what consumers want, and how we buy has changed
Companies are being launched and growing faster than ever
Mature firms are being merged, acquired, and dissolved
Page 3
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 4

5. Not-for-profit organizations – focus on causes not profit
Business Basics
Business – any activity that provides goods and services in an effort to earn profit
Not-for-profit organizations – focus on causes not profit
Page 3
Examples of non-profits: United Way, Planned Parenthood, Red Cross, and YM−YWCA.
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 5 5

6. Business Basics
Profit – the financial reward that comes from starting and running a business; the money that a business earns in sales (or revenue), minus expenses
Page 4
Link to Canada’s largest companies by market capitalization:
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 6 6

7. Business Basics
Entrepreneurs – people who risk time, money, and other resources to start and manage a business
Business drives up the
Standard of Living,
which, in turn, contributes
to the Quality of Life
Page 3
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 7 7

8. Business Encourages Entrepreneurial Spirit
Page 4
Exhibit 1.1 The Richest Canadians in 2011
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 8 8

9. LO2 The History of Business: Putting It All In Context
Long-term
Relationships
Satisfied Customers
Use of Technology
Consumer Power
Growth in
Consumerism
Product Differentiation
Customer Focus
Assembly Line
Refining Production
Productivity Gains
Decrease Costs
Hard Sell
No Customer Focus
Industrial Titans
Wealth Creation
Increase in Living Standard
Manipulation/Competition
Exploitation
Mass Production
Factories
Work Specialization
Efficiency
Pages 4-5
Industrial Revolution
1700-mid 1800s
Entrepreneurship Era
Second half of 1800s
Production Era
Early 1900s
Marketing Era
1950s
Relationship Era
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 9 9

10. LO3 Not-For-Profit Organizations and the Economy: The Business of Doing Good
Not-for-profit organizations focus on health, human services, education, art, religion, and culture
Canada’s non-profits contribute more than $80 billion to the economy
While focused on “doing good” rather than financial gain, non-profits are businesses in every other sense: they employ people, take in revenue, and produce goods and services
Link to Charity Village for a list of Canada’s not-for-profit organizations:
Discuss your college or university as a non-for-profit organization. What are its similarities to a for-profit business?
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 10 10

11. LO4 Factors of Production: The Building Blocks
Natural Resources
Businesses rely on some combination of these factors
Entrepreneurial activity can kick-start an economy by harnessing the other factors of production
Capital
Human Resources
Pages 5-7
Discuss each factor of production.
Highlight the key role entrepreneurs, as risk takers and innovators, play in strong economic systems.
Entrepreneurship
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 11 11

12. LO5 The Business Environment: The Context for Business
Page 7
Exhibit 1.2 The Business Environment
Explain and discuss each of the elements of the business environment.
How would a company such as BOMBARDIER (transportation company) or COSTCO (retailer) currently respond to each element of the business environment?
Talk about Tim Hortons and its new panini sandwiches to combine with the discussion point.
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 12 12

13. Free enterprise and fair competition flourish in Canada
Economic Environment
Free enterprise and fair competition flourish in Canada
Government takes an active role to support businesses:
Economic development is supported by Industry Canada
Provinces promote economic development by providing investment and tax incentives
Legislation supports enforceable contracts
Pages 7-8
The Canadian economy has favourable systems and supports for business as free enterprise is a key driver of the economy.
However, the Canadian economy, although strong with a solid foundation, does face some economic vulnerabilities.
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited
Copyright © 2011 by Nelson Education Limited 13 13

14. Economic Vulnerabilities
CEO/Worker pay gap
Corruption and ethical lapses
Consumer debt
Federal/provincial debt
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited

15. Competitive Environment
Today’s competition is intense
Companies must focus on loyal customers because they are the vocal promoters of their products/services
Page 8
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited
Copyright © 2011 by Nelson Education Limited 15 15

16. Competitive Environment
Companies must provide unsurpassed value
Value is the size gap between benefit and price
The cheapest product does not mean value
The key to value is quality
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited

17. Competitive Environment
How fast firms get products to market can be a competitive advantage
Bleeding edge firms launch products that fail because they are ahead of the market
Leading edge firms offer products just as the market is ready
Pages 8-9
Apple computers was not first to the MP3 market but they now own 75% market share
Employees are another key competitive advantage
Copyright © 2011 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 17
Copyright © 2014 by Nelson Education Limited 17 17

18. Competitive Principles
Avoid your competitors’ strengths and exploit their weaknesses; don’t try and beat them at their game
Always be a little paranoid; never underestimate your competition
Competitors will usually get better when pushed
Competitors are sometimes irrational when pushed
Pages 8-9
These principles are from Jack Trout, a 40-year marketing veteran.
Highlight Jack Trout’s advice (p. 8) on today’s competition. Note the companies that do this well: Exhibit 1.3 (next slide).
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 18 18

19. Competition is Changing
Top 10 global brands all U.S.-based
Japan, Germany, Finland, S. Korea, and France-based brands all included among the next 10 best
Insert exhibit 1.3, p. 8, C2e
Page 8
Exhibit 1.3
Discuss the biggest gainers in regards to brands. Review which brands are growing fastest.
Discuss the number of new products that are introduced every week.
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 19 19

20. Inventions with Impact (Can you identify four Canadian inventions?)
Disposable diapers Zippers
Cat litter
Poutine
Insulin
Bikinis
Laptop
Blackberry
Viagra
Camcorder
Great Inventions that have impacted human life….for better or for worse
Page 8
Four Canadian inventions: insulin, poutine, zippers, and Blackberry.
Link to eHow.com to see Canada’s top 10 inventions:
Note: There are other lists and rankings also available on the website.
Kool-Aid Astroturf
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 20 20

21. Technological Environment
Business technology includes any tools that businesses can use to become efficient and effective
Source of competitive advantage
Industries have experienced dramatic change
New industries have emerged
Page 10
Some industries have been responding slower than others while some remain at the cutting edge. Think about successful companies and how they use technology. Think about companies that are suffering financially. What opportunities have they ignored?
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 21 21

22. Technological Environment
Technology continues to evolve at breakneck speed; the change in everyday life and business operations is almost unimaginable
Companies that welcome change and manage it well will clearly be the winners
Page 13
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 22 22

23. Social Environment Diversity Aging population
Rising worker expectations
Ethics and social responsibility
Pages 10-12
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 23 23

24. Shades of Green: The Six Sins of Greenwashing
Sin of hidden trade-off
Sin of no proof
Sin of vagueness
Sin of irrelevance
Sin of lesser of two evils
Sin of fibbing
Page 12
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 24 24

25. Global Environment Technology Free Trade Natural Disasters
Technology is linking
customers/suppliers
worldwide
China and India’s
economies are
growing
Technology
Free Trade
Natural Disasters
Job Migration
Terrorism is more
of a threat today
Pages 12-14
While the world is becoming more global amongst rapid change, there are advantages and disadvantages and, at the same time, the multipronged threat of terrorism and job loss.
Blurred lines between
countries/world
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 25 25

26. Global Environment
Both China and India have been growing relatively fast due to foreign investment and internal development
China has been a magnet for manufacturing jobs and India for high tech jobs
Pages 12-14
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 26

27. LO6 Business and You: Making it Personal
What are your passions?
What are business careers that encompass your passions?
Page 14
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 27 27

28. Looking Back What is the role of business in the economy?
How has business evolved?
What is the role of non-profits in the economy?
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited 28

29. Looking Back What are the core factors of production?
What are the elements of the environment affecting business?
How are business trends impacting careers?
Copyright © 2014 by Nelson Education Limited
Copyright © 2014 by Nelson Education Limited