Monday, September 9 - Weebly

Monday, September 9

IB Business Management SL

ENTRY TASKS:- Sit in your chosen assigned seat from Friday.- Take out your Personal Brand Project (if you haven't presented).- Turn in your signed syllabus form at the front table (if you didn't on Friday).- Think of your top 3 favorite corporations.

TODAY✓ Book Check

✓ Finish Personal Brand Presentations

✓ Popsicle Sticks

✓ Choose Table Company Names

✓ Unit One Overview: Business Organization & Environment

✓ DECA Competition Video

✓ Business Plan Recap & Samples

TABLE NAMESChoose a company as your designated table name. It can be local, state-wide, national, international, etc. Your choice!

Tell us:

• Company name

• Why you chose it

• How it represents the members of your table

• Company mission statement and/or vision statement

1.1 - Introduction to Business Management✓ The role of business

✓ The main functions of business

✓ Business sectors

✓ The role of entrepreneurship

✓ Reasons for starting up a business

✓ Steps in the process for starting up a business

✓ Problems that a new business may face

✓ The elements of a business plan

✓ Intro to business management & the CUEGIS concepts

DECA BUSINESS PLANhttps://www.deca.org/high-school-programs/high-school-competitive-events/

1. Independent Business Plan

2. International Business Plan

3. Franchise Business Plan

4. Business Growth Plan

https://www.deca.org/high-school-programs/high-school-competitive-events/

Tuesday, September 10 (per 1 & 5)Wednesday, September 11 (per 4 & 6)


ENTRY TASKS: what makes a "good" business?

If you haven't already: turn in your signed syllabus form to the tray up front!

BUSINESS ORGANIZATION & ENVIRONMENT

IB Business Management

UNIT ONE










1.1 | The Role of BusinessOBJECTIVE

AO2: Demonstrate application and analysis

➢ The role of businesses in combining human, physical, & financial resources to create goods & services.

What do you think of when I say the word "business"?

Share your word(s)/short phrase(s) at menti.com and enter the code:

42 91 74You can enter up to 3 words/phrases!

1.1 | The Role of Business

What is a business?

➢Decision-making organization involved in the process of using inputs to produce goods and/or provide services

Identify:

• Products: goods & services

• Goods: physical products

• Services: intangible products


Types of products:

1. Consumer goods: products sold to general public, not other businesses• Durables

• Non-durables

2. Capital/producer goods: physical products bought by businesses to produce other goods/services

3. Services: intangible products provided by businesses

Think-Pair-ShareTurn to an elbow partner

Give an example of each type of product:

1. Consumer goods

2. Capital goods

3. Services



What is the role of a business?

➢The combine human, physical, & financial resources to create goods and services to satisfy the needs and wants of people, organizations, and governments

Identify:

• Needs: necessities for survival

• Wants: desires

Think-Pair-ShareTurn to an elbow partner

Give an example of:

• A need

• A want



Customer VERSUS Consumer

Customer: the people or organizations who BUY the product

Consumer: the people or organizations who USE the product










1.1 | The Main Functions of BusinessOBJECTIVE


➢ The main business functions and their roles: human resources, finance & accounts, marketing, and operations.

1.1 | The Main Functions of Business

4 interdependent functional areas:

1. Human Resources: manages personnel of an organization

2. Finance & Accounts: manages an organization's money

3. Marketing: identifies and satisfies needs & wants of customers

4. Operations: manages converting raw materials & components into finished goods, ready for sale & delivery


Human Resources (Chapter 2)Manages personnel of an organization

• Staffing

• Workforce planning

• Recruitment

• Training & On-boarding

• Benefits

• Record Keeping

• Compensation

• Performance Appraisal

• Dismissals

• Safety & Wellness

• Talent & Culture

• Labor & Relations


Finance & Accounts (Chapter 3)Manages an organization's money

An organization's Financial Director must ensure accurate recording and reporting of financial documents occurs to:

1. Comply with legal requirements

2. Inform those interested in the financial position of the organization (i.e. shareholders, potential investors)


Marketing (Chapter 4)Identifies and satisfies wants & needs of customers

Marketing professionals ensure products sell via tasks such as market research, advertising, & social media.

Functions (the 4 P's):

1. Product

2. Price

3. Promotion

4. Place


Operations (Chapter 5)Manages converting raw materials & components into finished goods, ready for sale & delivery

Examples: extraction of crude oil, car manufacturing, construction of roads

Also includes providing services to customers... as in the case of hotels, restaurants, salons, and financial institutions

Table DiscussionDiscuss with your table partnersIdentify examples of the following FUNCTIONS for your table's Company:

• Human Resources: Choose one area of HR to focus on

• Finance & Accounts: who is the company's CFO? Who are the top shareholders?

• Marketing: What types of marketing does your company utilize?

• Operations: Does your company focus more on converting raw materials into finished goods OR providing services to the public?


Class DiscussionDiscuss with the classThink about the education industry. Education is a type of business. Let's consider public colleges; the University of Washington, for example. Now think:

a) What types of revenue does the UW earn?

b) What types of costs of production does the UW encounter?

c) What do the four main functions of business look like for UW?


CURRENT EVENTS• Two students will present a current event every Tuesday (Extended Learning Day).

• Students' popsicle sticks will be drawn from the can each week to determine who presents the following week.

• You'll present a current event from your assigned week's news to the class.

• You'll need to include:

✓ WHO?

✓ WHAT?

✓ WHERE?

✓ WHEN?

✓ WHY?

✓ SO WHAT?

https://www.seattletimes.com/business/starbucks-ceos-new-ideas-start-with-a-pick-up-only-sstore-in-nyc/

✓ WHO?

✓ WHAT?

✓ WHERE?

✓ WHEN?

✓ WHY?

✓ SO WHAT?

https://www.seattletimes.com/business/starbucks-ceos-new-ideas-start-with-a-pick-up-only-sstore-in-nyc/

Thursday, September 12


ENTRY TASKS: Recall the terms products & services from yesterday's class. Think: What is your favorite, most cherished consumer good that you own? What is a service you couldn't live without?

TODAY

✓ IBBM SL Pre-Test (30 minutes)

✓Continue 1.1 (business sectors)










1.1 | Business SectorsOBJECTIVE


➢ Primary, secondary, tertiary, & quaternary sectors

➢ The nature of business activity in each sector and the impact of sectoral change on business activity.

1.1 | Business Sectors

4 stages of production:

1. Primary Sector

2. Secondary Sector

3. Tertiary Sector

4. Quaternary Sector


Primary Sector

Involved with extraction, harvesting, & conversion of natural resources

i.e. agriculture, fishing, mining, forestry, oil extraction

• Account for large percentage of output & employment in LEDC's

• Businesses operating in this sector in MEDC's use automation

• As economies develop, there's less reliance on primary sector because of little value added in primary production

Pause: now work with your table team to think of a company that operates in the PRIMARY sector

Less economically developed

countries (i.e. Haiti, Uganda, Ethiopia)


Secondary Sector

Involved in the manufacturing or construction of products

i.e. clothes manufacturers, publishing firms, construction firms

• Output is then sold to customers (other businesses, governments, foreign buyers, domestic customers)

• Largely dominant in economically developing countries

• The "wealth-creating sector" (value addded)

Pause: now work with your table team to think of a company that operates in the SECONDARY sector

Examples: Mexico, Jamaica, Ecuador,

Thailand


Tertiary Sector

Specialize in providing services to the general population

i.e. retailing, transportation, healthcare, banking, finance, insurance, leisure, entertainment, tourism

• Most substantial in MEDC's regarding output & employment

• These countries have a growing decline in the manufacturing sector

Pause: now work with your table team to think of a company that operates in the TERTIARY sector

More economically developed

countries (i.e. US, Germany, Australia,

Switzerland)


Quaternary Sector

Involved in the intellectual, knowledge-based activities that generate and share information

i.e. research & development (R&D), consultancy services, information communication technology (ICT), scientific research

• Subcategory of tertiary sector

• Mainly exists in MEDC's because it requires a highly educated workforce

• Businesses invest in this sector for further growth & innovation

Pause: now work with your table team to think of a company that operates in the QUATERNARY sector

PRODUCTION

MANUFACTURING

SERVICES(tertiary & quaternary output)

CONSUMERS

CHAIN OF PRODUCTIONThe 4 sectors are linked through this chain, which tracks the stages of an item's production


The 4 sectors are interdependent on each other because each relies on the others to remain in existence

➢No need for oil refiners if there are no customers for the oil (i.e. motorists or airlines)

➢Businesses are highly interdependent. They need: ICT, manufactured producer goods, financial services, management consultants


Sectoral Change

A shift in relative share of national output and employment that's attributed to each sector

• Industrialization causes a shift in business activity from primary to secondary because of higher added value

• Example: Apple


Several factors lead to sectoral change:

1. Higher household income

2. More leisure time

3. Greater focus on customer service

4. Increasing reliance on support services

Class ActivityName that Sector!

• You will each receive a post-it note with a service/activity listed on it.

• Then, you will stick it onto the poster of the sector that the activity belongs to.


Friday the 13th!!!


ENTRY TASKS: Think & Share: What are 3 traits and/or skills that you think an entrepreneur must have in order to be successful?

TODAY✓ DECA Stock Market Game FAQ's

✓ Continue 1.1 (the role of entrepreneurship, reasons for starting up a business)

DECA Stock Market Game FAQs• Where are the rules?

➢DECA Stock Market Game guidelines & rules

• When does the competition begin? 9/3/2019

• When is the last day to sign up? 10/18/2019

• How do I sign up? See your teacher.

• How many students can be on my team? 1-3.

• When is the diversification deadline? 10/25/2019 If you don't know what this is you didn't read #1.

• When does the competition end? 12/13/2019

• Are there tutorials? Yes! On my website.

• How do I compete at ICDC? Place in the Top 25 in our region!

http://r20.rs6.net/tn.jsp?f=001r6vDcBcNm6SiDOXRfuNKGds2M3NbIBDkYryNRuTdxZ-XOfyo1EHY9yoU5-nB8jGjsFHYtJ_1jYTJtSfNFUgUgt0C8-EBi5FsGGZ6kjoiVPz5KCNckwVu-0d9jG_Ml9cNxVpVnvxwyUJKBzRzCBjN-F_VPj_bizKoM4y3Xr3BKFpl2HngKMCA1pAOb0UQ_oimmGchLNh2jBcQSgXKF_pU9w==&c=mY2kXMy08w9prQcb-qDVKiUzzyNc0mQ_ctghYom4lRgZ2Glu13Zu8g==&ch=cTdVMFQ7jvx53eakhgj_cRU9-BPmdqL-ACyOlq65bojd4RnoSOTpzQ==










1.1 | The Role of Entrepreneurship & IntrapreneurshipOBJECTIVE

AO3: Demonstrate synthesis and evaluation

➢ The role of entrepreneurship and intrapreneurship in overall business activity.

1.1 | The Role of Entrepreneurship & Intrapreneurship

What is an entrepreneur?

An individual who plans, organizes, and manages a business, taking risks in doing so.

What is entrepreneurship?

The trait business leaders who are distinctive in their temperament, attitude, and outlook who drive the business


What are the traits & skills of entrepreneurs?

✓ An individual who combines the three other factors of production – pays rent for land, wages to labor, and interest on capital

✓ Have the skills needed to oversee the whole production process

✓ Ability and willingness to be creative, innovative, and passionate

✓ Search for business opportunities by forecasting and/or responding to change


What is an intrapreneur?

An employee who thinks and acts like an entrepreneur, but on behalf of the organization they work for

What is intrapreneurship?

The act of being an entrepreneur, but as an employee within a large organization


What are the traits & skills of intrapreneurs?

✓ Independent, creative, proactive, generates new ideas & innovations to the organization

✓ Takes direct responsibility and risks for turning a project or idea into a profitable finished product for the organization

✓ Looks for business opportunities to increase profit, but does it in the best interest of the organization

Table DiscussionChoose a businessperson who displays the traits & skills of an entrepreneur. Do some research and tell us about their:

• Background & upbringing

• College education and/or job experience

• Initiative & risks they took to be successful

• Innovative product(s) and/or idea(s)


Differences betweenEntrepreneur & Intrapreneur

Owner/operator of organization Employee of organization

Take substantial risks Take medium to high risks

Visionary Innovative

Rewarded with profit Rewarded with pay/compensation

Responsible for workforce Held accountable by owner

Failure incurs personal cost Failure absorbed by organization










1.1 | Reasons for Starting Up a BusinessOBJECTIVE


➢ Reasons for starting up a business or enterprise.

1.1 | Reasons for Starting Up a Business

G

E

T

C

A

S

H

GrowthEarningsTransference & InheritanceChallengeAutonomySecurityHobbies

1.1 | Reasons for Starting Up a BusinessGrowth

• Capital growth = increase in the value of an asset or investment over time (i.e. Property/land)

• Sometimes capital growth of a business can be worth more than the value of the owners' salaries

1.1 | Reasons for Starting Up a BusinessEarnings

• Potential returns from setting up your own business can easily outweigh the costs (even though the risks are high)

• "You can never get rich earning money from working for someone else."

1.1 | Reasons for Starting Up a BusinessTransference & Inheritance

• Many entrepreneurs view their business as something they can pass on (transference) to their children (inheritance) to give them sense of security

• In some societies, this is the cultural norm

1.1 | Reasons for Starting Up a BusinessChallenge

• Some might view setting up and running a business as a challenge

• The challenge drives entrepreneurs to perform and gives them personal satisfaction

1.1 | Reasons for Starting Up a BusinessAutonomy

• Autonomy = right or condition of self-government• Those who set up their own business have: independence,

freedom of choice, flexibility

1.1 | Reasons for Starting Up a BusinessSecurity

• More job security for someone who is their own boss• Risks of self-employment are great, but it's also easier to

accumulate personal wealth & provide higher funds for (early) retirement

1.1 | Reasons for Starting Up a BusinessHobbies

• Some want to turn their passions into a business• Being an entrepreneur is easier if the nature of work is

directly related to interests

Small Group DiscussionI will put you in groups of 4-5. Your group will be assigned one of the 7 reasons for starting up a business. Then, you'll create a start-up based on that reason – and share with the class. Tell us:

• Your start-up name

• Your products (goods and/or services) offered

• Your motivation for starting the business


Monday, September 16th


ENTRY TASKS:Think & Share: Imagine that you're starting up a business. What would be your biggest fear/concern?

CURRENT EVENTS START THIS WEEK!• Two students will present a current event every Tuesday (Extended Learning Day).

• Students' popsicle sticks will be drawn from the can each week to determine who presents the following week.

• You'll present a current event from your assigned week's news to the class.

• You'll need to include:

✓ WHO?

✓ WHAT?

✓ WHERE?

✓ WHEN?

✓ WHY?

✓ SO WHAT?










1.1 | Steps in the process of starting up a businessOBJECTIVE


➢ Common steps in the process of starting up a business or an enterprise.

1.1 | Steps in the Process for Starting Up a Business

The steps may vary country to country but, in general, these are the steps for starting up a business:

1. Write up a business plan2. Obtain start-up capital3. Obtain business registration4. Open a business bank account5. Marketing


1. Write up a business plan.

A feasible business idea becomes an official business plan.

Includes:• Goals• Objectives• Outlined plan of how targets will be reached


2. Obtain start-up capital.

Starting a business takes $$$$$

• Many small/new business owners use their own savings and/or obtain loans to finance their start-up

• The loan process can take several months, and the lender usually requires a completed business plan


3. Obtain business registration.

There are registration and licensing requirements that must be followed.

• Owners must register legal status/type of business organization (i.e. limited liability company, partnership, etc)


4. Open a business bank account

A bank account must be set up so the business can pay for its costs of operations and to receive payment from customers.


5. Marketing

Small/new businesses must get the word out about their product(s)!

• Examples: promotional campaign, website, advertising, social media


NOTE: Starting up a business can be very risky, and most new businesses fail due to mismanagement!!


Factors to consider when starting up a business:• Business idea• Finance• HR• Enterprise• Fixed assets• Suppliers• Customers• Marketing• Legal


Business ideaIdentify and fulfill a niche OR provide products that have a unique selling point

• Examples of innovative products: Amazon, Dell, Dyson


FinanceBusinesses need $ to fund business activities and need to keep records of all spending/income

• This can be a major barrier to starting up a business


Human ResourcesNeeded at ALL stages of operationsProduct design to development to delivery

• Need to hire, train, retain, & motivate staff

*In what ways can we companies do this?


EnterpriseBusiness owners need: entrepreneurial, effective leadership, & negotiation skills + passion and self-confidence


Fixed AssetsThings such as premises and capital equipment

• Popular location = higher chance of attracting customers, but also a higher cost


SuppliersBusinesses need suppliers for raw materials, finished stock, and support services

• Businesses often need to negotiate with suppliers, i.e. regarding price and delivery time


CustomersNo customers = the business will fail

• It's vital to use market research to find out what products customers want and need, at what price, and what location


MarketingThis step is ESSENTIAL

• With new businesses, it is key to get the word out about products


Legal issuesSuch as consumer protection laws, copyright & patent legislation, employment rights, food hygiene laws

• These can present MAJOR problems


Examples of start-up costs:• Premises: purchase costs, mortgage payment, rent deposit• Buildings: alterations, fixtures, fittings, insurance• Capital equipment: machinery, furniture, vehicles, phones• Legal/professional fees: licenses, permits, copyright permission• Marketing: research, ads, promotional campaigns• HR: recruitment, induction, training










1.1 | Problems that a new business may faceOBJECTIVE


➢ Problems that a new business or enterprise may face.

1.1 | Problems That a New Business May Face

• Lack of finance• Cash flow problems• Marketing problems• Unestablished customer base• People management problems• Legalities• Production problems• High production costs• Poor location• External influences

20-25% of new businesses fail in the first year


Lack of financeMost owners of new/small businesses don't have the credentials to secure external funding without major difficulty

• Borrowed funds may be insufficient or high interest charges might seriously affect cash floor

• Owners may remortgage homes to raise money


Cash flow problemsFinancing working capital can be a major problem for new businesses

• May have a lot of stock that can't be easily turned into cash or customers may demand lengthy pay period

• Owners often add cash flow forecast to the business plan so provisions can be taken to cover shortfalls

**Single largest cause of business failure**


Marketing problemsWhen businesses fail to meet customer needs, sales will be poor

• It's crucial to supply the right products at the right price, but many new business owners don't have the know-how


Unestablished customer baseIt's hard to attract customers, but even harder when there are established rivals in the market

• It takes time, money, and know-how to build a customer base


People management problemsMany new business owners have lack of experience in hiring the right people with the necessary skills

• This leads to poor customer service and the need to rehire or retrain staff

• New business owners often don't know the ideal organizational structure


LegalitiesPaperwork and legal requirements of setting up a new business can be tedious, time-consuming, confusing, & expensive

• i.e. business regulation procedures, insurance, copyright rules• Any oversight or a misstep could lead to compensation or

penalty fees


Production problemsIt's difficult accurately forecast levels of demand, which can lead to overproduction or underproduction

• Overproduction leads to stockpiling, wastage, increased costs• Underproduction leads to dissatisfied customers, loss of

potential sales


High production costsBecause of the large amount of money needed to pay for machinery, stock, rent, ads, insurance, etc.

• New/small businesses can't benefit from economies of scale (bigger, more established businesses benefit from lower average costs of production due to scale of operations)


Poor locationBusy areas offer the highest potential of customers but higher costs

• Many new/small business owners operate from home


External influencesExogeneous shocks affect all businesses (i.e. economic recession, oil crisis)

• New/small businesses are hit harder by these shocks


3 interrelated reasons for business failure: lack of cash in the business, poor cost control, and management incompetence

Common mistake: biggest risk = not taking any risks


Find a business that failed in its early stages. Tell us:

• The business idea• Why it failed

https://www.ted.com/talks/bill_gross_the_single_biggest_reason_why_startups_succeed?language=en

TED Talk: the single biggest reason why start-ups succeed

https://www.ted.com/talks/bill_gross_the_single_biggest_reason_why_startups_succeed?language=en

Periods 1 & 5: Tuesday, September 17thPeriods 4 & 6: Wednesday, September 18th


ENTRY TASKS:Think-Pair-Share: What is one thing you think you might need to include in a business plan? Assume that it'll be read by a potential lender.

CURRENT EVENTS – TUESDAY, 9/17/19

• 1st period: Kyle Karupiah – entrepreneurship• https://drive.google.com/file/d/1PSuPok_ZWX8udRIEXsq0sMgVtcLd0Oxf/view

• 1st period: Arthur Yan – business failure➢ https://www.npr.org/2019/09/14/760862605/moviepass-has-officially-shut-

down-and-we-dont-know-if-there-will-be-a-sequel• 5th period: Isaac• 5th period: Ross

https://drive.google.com/file/d/1PSuPok_ZWX8udRIEXsq0sMgVtcLd0Oxf/view

https://www.npr.org/2019/09/14/760862605/moviepass-has-officially-shut-down-and-we-dont-know-if-there-will-be-a-sequel

CURRENT EVENTS – 9/18/19

• 4th period: Mason Beckmeyer – human resources➢ https://www.nbcnews.com/business/autos/how-gm-strike-could-impact-

buyers-american-cars-n1054746• 4th period: Nathan B• 4th period: Connor Lee• 6th period: Katie B• 6th period: Forrest Williams

https://www.nbcnews.com/business/autos/how-gm-strike-could-impact-buyers-american-cars-n1054746










1.1 | The elements of a business planOBJECTIVE


➢ The elements of a business plan.

1.1 | Elements of a Business Plan

Business plan: a report detailing how a business sets out to achieve its goals and objectives

Also, a useful planning tool because it requires the owner(s) to consider marketing, finance, AND human resources of the business


A business plan helps to reassure financial lenders (i.e. banks, venture capitalists) that the entrepreneur has 1) comprehensively researched the business idea and 2) given reasons to support the venture

➢ Investors assess: opportunities, risks, & potential problems➢ Then, financiers can make an objective judgement regarding the firm's

likely success & its ability to repay loans➢ Other stakeholders (i.e. shareholders) will look at the business plan to

assess potential gains


Other components:

• SWOT analysis• Contingency plan• Supporting evidence (i.e. charts, stats, & other references)• Typically 5-6 pages• May include executive summary – summary given in the main report

highlighting key points & conclusions

1.1 | The elements of a business planTABLE DISCUSSION

I'm going to assign each table an element of the business plan. Think about what could be included in your element of the business plan. Then, we'll share out.


Contents of a typical business plan:

• The business• The product• The market• The finance• The personnel• The marketing


The business

• Name & address• Costs of premises & other start-up costs• Details of owner(s) & past business experience• Type of business organization• Quantifiable goals & objectives


The product

• Details of good(s) and/or service(s)• Supporting evidence of why customers will buy products• Where and how production will take place• Details of suppliers of resources• Costs of production• Pricing strategies


The market

• Expected number of customers or forecasted sales• Nature of the market such as customer profiles and market

segmentation• Expected growth of the market in the foreseeable future• Competitor analysis


The finance

• Proposed sources of funding• Break-even analysis• Security in case borrower defaults• Cash flow forecast and steps to deal with cash flow problems• Forecast profit and loss amount for first year• Forecast balance sheet showing firm's financial health• Forecast rate of return for investors


The personnel

• Number and job roles of workers to be employed• Organizational structure• Payment details (i.e. wage rates)


The marketing

• Market research & test marketing• Distribution plan• Details of promotional mix• Unique selling point










1.1 | Intro to business management & the CUEGIS conceptsOBJECTIVE


➢ The CUEGIS concepts.

1.1 | Intro to Business Management & the CUEGIS Concepts

Concept-based learning:Three-dimensional model that structures facts(content) and skills with concepts of a particular discipline = CUEGIS concepts

Provide 6 conceptual lenses through which students investigate, analyze, and evaluate factual content to create deeper understanding of Business Management

C - ChangeU - CultureE - EthicsG - GlobalizationI - InnovationS - Strategy

1.1 | Intro to Business Management & the CUEGIS Concepts

Business activity: the process of turning inputs into outputs in order to meet the needs and wants of different customers

Purpose of business activity: to satisfy the needs and wants of customers WHILE fulfilling the organization's objectives

➢ All businesses must generate profit or surplus to survive

1.1 | Quiz Review

Terms to know & understand:• Business plan• Businesses• Consumers• Customers• Entrepreneurship• Intrapreneurship• Needs• Primary sector

• Quaternary sector• Secondary sector• Sectoral change• Tertiary sector• Wants

1.1 | Quiz Review

Concepts to understand – be able to apply & analyze in case studies/real-world examples:• 4 main functional areas of business• Distinguish between goods (know the 2 types) and services• 4 business sectors & sectoral change• What it takes to be an entrepreneur/intrapreneur and the differences between the two• Various reasons someone may start a business• The 5 steps to start up a business• Factors to take into consideration when starting a business• Start-up costs a new business may encounter• Problems a new business may face• Elements of a business plan

1.1 | Deliverables for Thursday, 9/19

• Study for 1.1 Quiz (Thursday, September 19 in class)• Pay your DECA dues (by Monday, September 23)• Ask a parent/family member:

• Who is your favorite entrepreneur and why?• When you were a kid/teen, what was a business that failed? Why

did it fail?

1.1 | DECA Business Plan Elements

http://misshallshs.weebly.com/business-plan.html

http://misshallshs.weebly.com/business-plan.html

Thursday, September 19th


ENTRY TASKS:• Take the first 4 minutes of class for final quiz review / to ask me questions.• Write your parent's answer to one of the questions I presented on

Tuesday/Wednesday on an index card:• Who is your favorite entrepreneur and why?• When you were a kid/teen, what is a business that failed? Why'd it fail?

1.1 | Quiz Review

Terms to know & understand:• Business plan• Businesses• Consumers• Customers• Entrepreneurship• Intrapreneurship• Needs• Primary sector

• Quaternary sector• Secondary sector• Sectoral change• Tertiary sector• Wants

1.1 | Quiz Review

Concepts to understand – be able to apply & analyze in case studies/real-world examples:• 4 main functional areas of business• Distinguish between goods (know the 2 types) and services• 4 business sectors & sectoral change• What it takes to be an entrepreneur/intrapreneur and the differences between the two• Various reasons someone may start a business• The 5 steps to start up a business• Factors to take into consideration when starting a business• Start-up costs a new business may encounter• Problems a new business may face• Elements of a business plan

1.1 | Quiz

Things to do when you're done:• Write down your parent's answer to one of the questions I asked:

• Who is your favorite entrepreneur & why?• When you were a kid/teen, what was a business that failed? Why did it

fail?

• Brainstorm ideas for your business plan• Homework for another class

No phones or laptops out until everyone has finished the quiz!

1.1 | Reminders & FYI's

• If you want to look at DECA Business Plan samples from past students, you can do so by following these steps:• Go to Mr. Sherman's new website: http://www.bjsherman.com/• Enter the passcode: DECA2020 (all caps!!)• Click on the DECA drop-down arrow• Click on Business Plan Resources• You'll be taken to a DropBox folder. You can find sample papers for each

category here• DECA FAQ's have been added to my website! Check it out under my DECA

tab.

http://www.bjsherman.com/

1.1 | Deliverables for Friday, 9/20

• Pay your $40 DECA dues (by Monday, September 23)• Skim 1.2 in your book (we'll begin this section tomorrow)• For your DECA Business Plan, know:

• If you'll be working alone, with a partner, or in a trio• Which of the 4 categories you'll be competing in

Friday, September 20th


ENTRY TASKS:• Grab an index card from the turn-in table. Write the following items

on it, regarding your DECA Business Plan:• Your name + name(s) of your partner(s), if applicable, and what

period they're in• Which of the 4 categories you plan to compete in (if you're not

sure, write down the ones you're considering/exploring)• Any ideas you have for your Business Plan

DAILY OVERVIEW – 9/20/19

• Lock in Business Plan teams• Score multiple choice/matching/completion sections of the 1.1 quiz• Discuss DECA "pre-prepared" events

Class Period Representatives

This year we will be rolling out a new plan for communication within Skyline DECA. Each class will have one class representative who will be asked to 1) attend a monthly meeting with the DECA board and 2) act as a communication medium between the board and the rest of Skyline DECA students. We ask that interested students possess strong speaking abilities, punctuality, and passion for DECA. This will be an extremely important position that--if implemented well--will prove very advantageous to our chapter.

If you are an interested student, answer the 3 following questions by next Friday (9/27/19) and send responses as a Word Doc to [email protected]:

• 1) Why should we select you for the position of class representative?

• 2) Describe yourself in three words.

• 3) What does it mean to you to have "character"?

• Include name, grade, & gender

mailto:[email protected]

DELIVERABLES – 9/20/19

• Pay $40 DECA dues to bookkeeper or online• Continue brainstorming Business Plan ideas• Sign up for my 9/24 OR 9/25 Flex Time!!!• Skim 1.2

Monday, September 23rd


ENTRY TASK:• Think-Pair-Share: Tell someone at your table...

o Which DECA competitive event(s) you plan to compete in, other than the Business Plan

o Any question(s) you have about DECA competitive event options• When the bell rings: raise your hand and keep it raised if you've paid

your DECA dues.

DAILY OVERVIEW

• DECA competitive events Q&A• 1.2: Types of Organizations

REMINDERS

✓ Pay your $40 DECA dues to the bookkeeper or online✓ Sign up for my Flex Time on Tuesday 9/24 OR Wednesday 9/25✓ Continue brainstorming ideas for Business Plan✓ Think about what other DECA event(s) you want to compete in

1.2 - Types of Organizations✓ The private & public sectors

✓ Profit-based organizations

✓ For-profit social enterprises

✓ Non-profit social enterprises

✓ Types of organizations & the CUEGIS concepts

1.2 | The private & public sectorsOBJECTIVE


➢ Distinction between the private and the public sectors.

1.2 | The Private & Public Sectors

Private SectorOrganizations that are owned and controlled by private individuals and businesses, rather than the government

• Differ in size – from those owner & run by one person to large multinational companies that operate all over the world

• Main aim: to make profit (sales revenue – costs)


Public SectorUnder ownership and control of the government

• Traditionally, they provide essential goods & services that would be underprovided or inefficiently provided by the private sector (I.e. health care, education, emergency services)

• State-owned enterprises: organizations that are wholly owned by the government


Reasons for public sector activity:• Ensures everyone has access to basic services (i.e. education, health care,

public libraries)• To avoid wasteful competition, because the government is able to achieve

HUGE economies of scale, such as postal service or national defense• To protect citizens and businesses through institutions like the police and

courts that govern law and order• To create employment (large employers of teachers, doctors, nurses)• To stabilize the economy (I.e. several private sector banks were bought by

the government during global credit crisis)

1.2 | The Private & Public SectorsProvision of Basic Services

In America, education, housing, health-care, broadcasting, and mail delivery services can be provided by both private-sector firms and the public sector.

➢ Distinguish between the aims of businesses in the public sector and the private sector in your service category.

➢ Tell us about: goals, pros, cons, opportunities, threats, & examples of businesses of the private vs public sector of your category






1.2 | Profit-based organizations, for-profit social enterprises, & non-profit social enterprisesOBJECTIVEAO3: Demonstrate synthesis and evaluation➢ The main features of the following types of for-profit (commercial)

organizations: sole traders, partnerships, & companies/corporations.➢ The main features of the following types of for-profit social enterprises:

microfinance providers & public-private partnerships➢ The main features of the following types of non-profit social enterprises:

non-governmental organizations (NGOs) and charities.

1.2 | The Private & Public SectorsProfit-based organizationsMost businesses that operate in the private sector aim to make a profit.

➢ Profit-based organizations differ in terms of ownership and control (you do not have to run a business simply because you own it), how they raise finance, and how the profits are distributed.

➢ 3 types:▪ Sole traders▪ Partnerships▪ Companies/corporations

1.2 | The Private & Public SectorsSocial EnterprisesRevenue-generating businesses with social objectives at the core of their operations

• Two categories: 1) For-profit companies and 2) Non-profit organizations• Regardless, two goals: 1) achieve social objectives and 2) earn revenue in

excess of costs• Cannot deliver social good if they do not manage financial health• Success in helping others depends on ability to operate sustainable

business (no surplus or profit = no business)

1.2 | The Private & Public SectorsFor-profit social enterprisesStrive to earn a profit for their owners, while still operating with social objectives at the core of their business

• Profit is the reward distributed to the owners or investors in the business in return for risking their money in the business

• Three types:• Cooperatives• Microfinance providers• Public-private partnerships (PPP)

1.2 | The Private & Public SectorsNon-profit Social EnterprisesBusinesses run in a commercial-like manner but without profit being the main goal

• Non-profit organizations (NPOs) use their surplus revenues to achieve their social goals rather than distributing the surplus as profits or dividends

• Examples: public libraries, state schools, museums, government hospitals, social services (Habitat for Humanity, Red Cross)

• NPO does not mean that the business is not allowed to make a profit or surplus, but it must be retained in the business for its self-preservation and growth

• 2 types: non-governmental organizations (NGOs) & charities

Periods 1 & 5: Tuesday, September 24thPeriods 4 & 6: Wednesday, September 25th


ENTRY TASK:• Think about:

1) your Business Plan idea2) what other competitive event(s) you'll be participating in

1.2 |DAILY OVERVIEW✓ New Current Events Rubric✓ 1.2 (Types of Organizations) jigsaw activity

NOTE: 1.2 Quiz on Friday!!!

1.2 | Types of Organizations

Profit-Based Organizations

Social Enterprises

Sole Traders

PartnershipsCompanies/Corporations

For-ProfitSocial

Enterprises

Non-Profit Social

Enterprises

CooperativesMicro

finance provider

PPP's NGOs Charities

1.2 |JIGSAW ACTIVITY• 5 minutes: You'll number off 1 – 8. Each number corresponds with a type of

organization. You'll meet with all students who were assigned the same number / type of organization (3-4 students per group). You'll work together with your group to become "masters" of your content.

• 30 minutes: With your group, you'll fill out your own graphic organizer for your type of organization, while simultaneously creating a poster with the same content (in condensed format).

• 30 minutes: Then, you'll move into a group of 6 other students (one who represents each of the other types of organizations). You'll teach your group members about your assigned type of organization, and they'll teach you about theirs! You'll fill out a graphic organizer for each other type of organization so you have notes to study.

1.2 |JIGSAW ACTIVITY• 1's: one 1, one 2, two 3's• 2's: one 1, two 2's, one 3• 3's: two 1's, one 2, one 3• 4's: one 1, one 2, two 3's• 5's: one 1, two 2's, one 3• 6's, 7's, & 8's: one 1, one 2, one 3

Thursday, September 26th


ENTRY TASK:• To Do:

• Take out your Types of Organizations packet• Have one person from your group grab your poster

• Recall & Apply: which type of organization is each of the following businesses?• Target• West Sound Wildlife Shelter• BECU• Red Cross

DAILY OVERVIEW

• Finish jigsaw activity & presentations• Supplemental 1.2 lecture• Quiz review

REMINDERS✓ Pay your $40 DECA dues online or to the bookkeeper! First class to be

fully paid gets CANDY.• 1st period: 6 students• 3rd period: 11 students• 4th period: 9 students• 5th period: 5 students• 6th period: 7 students

✓ Apply to be your Class Period DECA Representative✓ Determine your DECA Business Plan idea & other event(s) you'll be

competing in at Area by Monday, September 30th✓ Study for tomorrow's quiz!

JIGSAW ACTIVITY

• Get back into your large groups: Group 1, Group 2, Group 3• Finish up teaching each other about the 8 types of

organizations• Finish large group activity within 30 minutes (5 minutes/type

of organization)• Grab your poster from the basket and be ready to present• Present posters for 10 minutes

JIGSAW ACTIVITY

• What should my notes look like?• What should our poster presentation look/sound like?• What should I be doing as a listener during the

presentations?

1.2 | Types of Organizations

Profit-Based Organizations

Social Enterprises

Sole Traders

PartnershipsCompanies/Corporations

For-ProfitSocial

Enterprises

Non-Profit Social

Enterprises

CooperativesMicro

finance provider

PPP's NGOs Charities






1.2 | Profit-based organizations, for-profit social enterprises, & non-profit social enterprisesOBJECTIVEAO3: Demonstrate synthesis and evaluation➢ The main features of the following types of for-profit (commercial)

organizations: sole traders, partnerships, & companies/corporations.➢ The main features of the following types of for-profit social enterprises:

microfinance providers & public-private partnerships➢ The main features of the following types of non-profit social enterprises:

non-governmental organizations (NGOs) and charities.

1.2 | Supplemental Lecture – Tads & TidbitsUnlimited Liability: feature of sole traders & ordinary partnerships who are legally liable for all monies owed to their creditors (even if they have to sell personal possessions to pay their debts)

• Exists to prevent sole traders and partners from making careless decisions in managing their businesses

• Makes individuals accountable for their actions & decisions• Risk of loss of property = entrepreneurs make safe decisions instead of

taking risks

1.2 | Supplemental Lecture – Tads & TidbitsCompany? (or) Business?

Companies are owned by shareholders (only 2 types: private limited and public limited companies).

Businesses cover all other forms of ownership, such as sole traders & partnerships.

Bottom line: all companies are businesses, but not all businesses are companies.

1.2 | Supplemental Lecture – Tads & Tidbits

Abbreviations for public limited companies

• USA – Inc., Corp.• Australia – Pty. Ltd. (proprietary limited company)• Germany – AG (German word for 'shareholder corporation')• Hong Kong – Ltd. for private & public• Sweden – AB (Swedish phrase for 'limited liability company')

1.2 | Supplemental Lecture – Tads & Tidbits

Charities as Not-For-Profit Social Enterprises

Doesn't mean that they don't strive for surplus

Surplus not classified as "profit" because it doesn't get distributed to owners or taxed by the government but is reinvested in the charity itself

1.2 | Types of OrganizationsVarious factors that affect the strategic choice of setting up a business:• Amount of finance: change in legal status usually requires more finance• Size: larger the operation, more likely it is to be a corporation• Limited liability: desire to have this can affect legal status• Degree of ownership: those who wish to retain control/ownership may

prefer to stay as a sole trader or maybe private limited companies• Type of business activity: nature & scale of business activity can influence

legal status• Change: as a business grows & evolves, it might need further HR &

finance, likely causing the type of organization to change

1.2 |Quiz Review

Terms• Charities• Cooperatives• Companies/Corporations• Deeds of partnership• Incorporation• Initial Public Offering (IPO)• Limited liability• Microfinance provider• Non-governmental organization

• Partnerships• Private limited company• Private sector• Public limited company• Public-private partnerships• Public sector• Sole trader• Social enterprises• State-owned enterprises• Stock exchange• Unlimited liability

1.2 | Quiz Review

• Public vs private sector• Private limited vs public limited company• Cooperatives vs microfinance providers vs public-private

partnerships• Concept of limited liability• Partnership vs sole trader• Examples of each type of organization• Tads & Tidbits I just covered


fully paid gets CANDY.• 1st period: 6 students• 3rd period: 11 students• 4th period: 9 students• 5th period: 5 students• 6th period: 7 students

✓ Apply to be your Class Period DECA Representative✓ Determine your DECA Business Plan idea & other event(s) you'll be

competing in at Area by Monday, September 30th✓ Study for tomorrow's quiz!

Friday, September 27th


ENTRY TASK:• Turn In:

• Your Types of Organizations packet• Put Away:

• Cellphones• Laptops• Notes


fully paid gets CANDY.✓ Apply to be your Class Period DECA Representative by 3:00pm today!✓ Determine your DECA Business Plan idea & other event(s) you'll be

competing in at Area by Monday (September 30th)!!!!!✓ Sign up for Flex Time for next week by 9am on Monday.

• October 1 & 2: identify your problem, solution, unique value proposition, & target market

• October 8 & 9: identify target market/pathways, areas of costs & revenue

• October 8: IB in Theatre (process, costs, benefits, questions)

AFTER THE QUIZ YOU CAN...✓ Work on homework for another class✓ Think about your DECA Business Plan

NO PHONES OR LAPTOPS OUT!

Monday, September 30


ENTRY TASKS:• Turn in: your Types of Organizations packet if you didn't on

Friday• Think about: your DECA competitive event(s)• Do: Go vote for your favorite poster for each type of

organization on the side white board!! I'll put the winners up :)

DAILY OVERVIEW✓ Peer grade 1.2 quizzes✓ Begin to select DECA competitive event(s)✓ Begin 1.3: mission & vision statements

1.3 - Organizational Objectives✓ Vision statements

& mission statements

✓ Aims, objectives, strategies, & tactics

✓ The need for changing objectives

✓ Ethical objectives

✓ SWOT analysis

✓ The Ansoff matrix

✓ Organizational objectives & the CUEGIS concepts

1.3 | Mission & vision statementsOBJECTIVE


➢ Vision statement & mission statement.

1.3 | Mission & vision statements

Vision statementsOutlines an organization's aspirations in the distant future

➢ Vision: to have an image of an ideal situation in the future➢ Tend to relate to the attainment of success➢ Visualization of what success would look like


Mission statementsSimple declaration of an organization's existance and it's core values

➢ Mission: to have clear purpose➢ Clearly defined & realistically achieveable➢ Gives sense of direction & guides decision-making➢ Unifies all people & corporate cultures within the organization to achieve overall

vision➢ Does not have distinct timeframe➢ Tends to be qualitative, not quantitative


Differences between the two

• Vision statement addresses "what do we want to become?" & mission statement deals with "what is our business?"

• Vision statement focuses on long-term, while mission statement can focus on medium or long-term

• Mission statement is updated more frequently• Vision statements do not have to be actual targets that must be achieved;

instead, they allow people to see what could be• Mission statement tends to outline values of the business


Limitations & disadvantages

• No more than a PR stunt• Can be very time-consuming• Very difficult to craft statements that cater to all dynamics of a business• Might not be supported by all stakeholders & can be hard to convert

people's beliefs


Steps in setting mission statements:

1. Defines the organization (i.e. what it is)2. Outlines what the organization aspires to be (in line with its vision

statement)3. Limited enough to exclude certain ventures4. Broad enough to allow for growth in a creative or innovative way5. Serves to evaluate current business activities6. Phrased clearly so it's understood by all


Mission statement examples

Coca-Cola• To refresh the world in mind, body and spirit• To inspire moments of optimism and happiness through our brands and

actions• To create value and make a difference.


Mission statement examples

Alzheimer's AssociationTo eliminate Alzheimer's disease through the advancement of research; to provide and enhance care and support for all affected; and to reduce the risk of dementia through the promotion of brain health.


Vision statement examples

Coca-ColaTo achieve our mission, we have developed a set of goals, which we will work with our bottlers to deliver:People: Inspiring each other to be the best we can be by providing a great place to workPortfolio: Offering the world a portfolio of drinks brands that anticipate and satisfy people's desires and needsPartners: Nurturing a winning network of partners and building mutual loyaltyPlanet: Being a responsible global citizen that makes a difference by helping to build and support sustainable communitiesProfit: Maximizing long-term return to shareholders, while being mindful of our overall responsibilitiesProductivity: Being a highly effective, lean and fast-moving organization.


Vision statement examples

Alzheimer's AssociationA world without Alzheimer's disease.

Tuesday, October 1 &Wednesday, October 2


ENTRY TASKS:• Turn in: your Types of Organizations packet if you didn't on

Friday or Monday• Think about: your DECA competitive event(s)• Recall: your favorite business's mission and/or vision

statement

DAILY OVERVIEW✓ Chocolate✓ 1.3: aims, objectives, strategies, & tactics + need for changing

objectives






✓ SWOT analysis



1.3 | Aims, objectives, strategies, tacticsOBJECTIVE


➢ Aims, objectives, strategies, and tactics – and their relationships.

1.3 | Aims, objectives, strategies, & tactics

AimsGeneral & long-term goals of an organization

• Broadly expressed as vague & unquantifiable statements• Serve to give a general purpose & direction for an organization• Often expressed in the mission statement• Usually set by senior directors• Example: "to provide a high quality education to all"


ObjectivesShort-to-medium-term & specific targets an organization sets in order to achieve its aims

• More specific & quantifiable than aims• Must be consistent with aims• Can be set by managers & subordinates• Example: "to achieve 95% pass rate within two years"


Aims• What business wants to

achieve• Not necessarily time-bound• Vague or abstract goal• What a business wants to

happen• Set by senior leaders

Objectives• What the business must do to

achieve the aim• Time-bound• Specific & measurable target• What a business needs to

happen• Set by managers/subordinates


Importance of aims & objectives

1. To measure & control2. To motivate3. To direct


StrategiesPlans of action to achieve strategic objectives of an organization• Operational: day-to-day methods used to improve efficiency; aimed at

trying to achieve tactical objectives➢ i.e. restaurant investigates how to reduce customer wait time without

compromising quality of service

• Generic: those that affect business as a whole➢ i.e. business looks at how to gain competitive advantage to achieve goals

Corporate: targeted at long-term goals of a business➢ i.e. firm aims for market dominance through mergers


Tactical objectivesShort-term goals that guide daily functioning of certain departments or operations• i.e. "to keep staff turnover below 10%" or "to raise sales by

$10M in the next year"• Tend to refer to targets set for up to 12 months, such as:➢ Survival➢ Sales revenue maximization


Strategic objectivesLonger-term goals of a business• Profit maximization: traditionally, the main objective• Growth: usually measured by sales revenue or market share• Market standing: extent of presence in industry• Image & reputation: improved customer service, better

facilities, superior after-sales care


CLASS DISCUSSION

What business(es) do you think of when you think of the _______________ industry?

➢ Cellphone➢ Coffee➢ Fast food➢ Sports & entertainment


Overall...

• Strategic objectives can be a combination of many reasons• Objectives can change over time• Organizational culture affects aims & objectives• Operation in private vs public sector affects aims & objectives


Check for understanding

• Aims: state what an organization WANTS• Objectives: state what an organization needs to achieve in order to

get what it wants• Strategies: the actions that facilitate an organization to meet its

goals• Tactics: short-term actions used to achieve an organization's tactical

objectives






✓ SWOT analysis



1.3 | The need for changing objectivesOBJECTIVE


➢ The need for organizations to change objectives and innovate in response to changes in internal and external environments.


Internal & External factors may cause an organization to change objectives.


Internal factors:1. Corporate culture: the accepted norms & customs2. Type & size of organization: change in legal structure3. Private vs public sector organizations4. Age of the business: newer focus on break-even; more est businesses

focus on growth/higher market share5. Finance6. Risk profile: more willingness to take risks = more ambitious objectives7. Crisis management: higher employee turnover, liquidity problems,

quality standards, etc.


External factors:1. State of the economy: booms vs slumps2. Government constraints: rules & regulations3. Presence & power of pressure groups: may need to review approach to

ethics4. New technologies: can create business opps (i.e. e-commerce)


External environment can provide positive changes, thus creating new business opportunities.

ENTRY TASKS:• Think-Pair-Share: What's one company you consider socially responsible? One company

that's not? Share with a partner and be ready to share with the class.

Happy NationalMean Girls Day!

1.3 |DAILY OVERVIEW

✓ Reminder about IB Testing registration✓ Reminder about DECA dues✓ DECA Business Plan date checkpoints overview✓ 1.3 - Ethical objectives✓ Sign up for DECA competitive events






✓ SWOT analysis



1.3 | Ethical objectivesOBJECTIVE

AO1, AO3

➢ Ethical objectives & CSR.

➢ The reasons why organizations set ethical objectives and the impact of implementing them.

➢ The evolving role & nature of CSR.

1.3 | Ethical objectives

EthicsThe moral principles that guide decision-making and strategy.

Morals are concerned with what is considered to be right vs wrong, from society's point of view.


Business EthicsThe actions of people & organizations that are considered to be morally correct.

➢ An ethical & socially responsible business acts morally toward workers, customers, shareholders, & the natural environment.

➢ Pressure to act ethically may come from 1) within the business or 2) impositions from external factors.

1.3 | Ethical objectivesExamples of ethical objectives:

• Reducing pollution by using more environmentally friendly production processes

• Disposal of waste in an environmental manner• Increased recycling of waste materials• Offering staff sufficient rest breaks during work• Fairer conditions of trade with less economically developed

countries (LEDCs)


Examples of unethical behavior

• Financial dishonesty: business mismanages finances• Environmental neglect: harm to natural environment• Exploitation of the workforce: mistreatment of staff• Exploitation of suppliers: businesses take advantage of suppliers,

forcing them to lower prices• Exploitation of consumers: business knowingly sells products with

harmful side effects

1.3 | Table DiscussionFind a business that has recently taken part in your assigned unethical behavior. Then, tell us about it!• Financial dishonesty• Environmental neglect• Exploitation of the workforce• Exploitation of suppliers• Exploitation of consumers

Tell us about:• What happened? • When & where?• Who was impacted?• Did the business receive any

penalties?• What is the business doing to

make it better? If nothing, what do you suggest?


Corporate Social Responsibility (CSR)Conscientious consideration of ethical & environmental practices related to business activity

Socially responsible businesses act morally toward stakeholders.


3 broad views / attitudes toward the role of businesses in delivering CSR

1. Self-interest (non-compliance)2. Altruistic3. Strategic


Self-interest attitude toward CSR

• Role of businesses is to generate profits for their owners.• Governments are responsible for sorting out social problems.• In pursuing profit motive, firms become more efficient &

prosperous – and therefore help society indirectly (eg: employment, wealth creation, etc)


Altruistic attitude toward CSR

• Humanitarian & unselfish behavior• Eg: altruistic businesses do what they can to improve society,

such as willingly donating money or investing in local community projects


Strategic attitude toward CSR

• Businesses ought to be socially responsible ONLY if such actions help them to become more profitable

• They see CSR as a method of long-term growth


Advantages of ethical behavior

• Improved corporate image: enhance reputation• Increased customer loyalty: customers like businesses that don't act

immorally• Cost cutting: can decrease certain costs (eg: excess packaging,

litigation costs)• Improved staff morale & motivation: attract & retain highly

motivated staff


Advantages of ethical behavior

• Improved corporate image: enhance reputation• Increased customer loyalty: customers like businesses that don't act

immorally• Cost cutting: can decrease certain costs (eg: excess packaging,

litigation costs)• Improved staff morale & motivation: attract & retain highly

motivated staff


Limitations of ethical behavior

• Compliance costs: potentially very high costs of being socially responsible

• Lower profits: ethical dilemma – when ethical decision-making involves adopting a less profitable course of action

• Stakeholder conflict: some stakeholders are more concerned with ST profits, not LT ethical behavior

• Ethics & CSR are subjective: views depend on individual/society

1.3 | Ethical objectivesElements of the evolving role of CSR

• Nature of CSR is subjective – what is "right" or "wrong" depends on public opinion, which changes over time

• Changes in societal norms = businesses need to review CSR policies & practices occasionally

• Through pressure groups & educational awareness, businesses stepping up to do their part

• CSR gets complicated when business operate in different countries• Controversy: whether managers should make CSR decisions. They're acting on behalf of

profit-seeking owners

1.3 | Class DiscussionThink: What is a current societal norm or public opinion that could cause a business to reevaluate their CSR policies?

Take a minute to think & chat with your table partners. Then, I'll call on some students to share.


Ways businesses can adapt to meet social responsibilities• Providing accurate info & labeling: help consumers to make better

informed decisions (eg: truthful nutritional info)• Adhering to fair employment practices: decent working conditions,

fair training opportunities, etc• Having consideration for the environment: use recycled materials,

recycle more of waste materials, reduce pollution• Active community work: voluntary & charity work, helping to give

something back to society


What encourages CSR?• The media• Ethical codes of practice• Training• Government assistance• Government legislation• Competitor's actions

1.3 | Ethical objectivesWhether a business acts in a socially responsible way depends on several interrelated factors:• Involvement, influence, & power of various stakeholders, like pressure

groups• Corporate culture & attitude toward CSR• Societal expectations• Exposure & pressure from media• Experiences with CSR (positive & negative)• Compliance costs (HR & financial resources)• Laws & regulation (legislation)

FriYAY, October 4th


ENTRY TASKS:

Think of a business who has utilized Product Development: selling new products for existing customers

DAILY OVERVIEW✓ IB Exam Registration Reminder✓ Flex Time reminder✓ Draw next week's Current Event presenters✓ Website navigation: Business Plan resources✓ 1.3: SWOT Analysis & Ansoff Matrix

FYI: Monday, October 7th – 1.3 Assessment (group case study)Review notes & skim book!

FLEX TIME – 10/8 & 10/9Sign up TODAY! Come to one, NOT both! Bring your laptop!• Independent BP: Finish "Problem" section and begin "Customer

Segments" section• International BP: Finish "Analysis of International situation" &

"Problem" and begin "Customer Segments" section• Franchise BP: Finish "Business history, background and

objectives" and begin "Business Environment" section• Grow Your Business BP: Work on "Introduction" & "SWOT"

October 8th in Theatre: IB Exam Information Session Flex Time!!






✓ SWOT analysis



1.3 | SWOT AnalysisOBJECTIVE

AO3, AO4

➢ SWOT analysis of a given organization.

1.3 | SWOT AnalysisSWOT Analysis

• Simple yet useful decision-making tool• Can be used to assess the current & future situation of a

product, brand, business, proposal, or decision• Strengths, Weaknesses, Opportunities, Threats• Consider both internal factors (strengths & weaknesses) and

external factors (opportunities & threats)

1.3 | SWOT AnalysisStrengths

• Internal factors that are favorable compared with competitors• Help a business better achieve its objectives• Need to be developed & protected• ie: strong brand loyalty, good corporate image, & highly skilled

workers

1.3 | SWOT AnalysisWeaknesses

• Internal factors that are unfavorable when compared with rivals (they create competitive disadvantages)

• Likely to prevent or delay the business from achieving its goals• To remain competitive, the business needs to reduce or remove

its weaknesses

1.3 | SWOT AnalysisOpportunities

• External possibilities/prospects for future development• Changes in the external environment that create favorable

conditions for a business• Ie: China & India present many business opportunities, such as

a huge customer base & rapid economic growth• SWOT can help a firm formulate business strategy

1.3 | SWOT AnalysisThreats

• External factors that hinder the prospects for an organization• They cause problems for a business• Examples: technological breakdowns, product recalls, changes

in fashion, price wars, oil crises, recession, natural disasters, infectious diseases

1.3 | SWOT AnalysisRemember:

• Strengths & Weaknesses are INTERNAL factors that an organization CURRENTLY faces

• Opportunities & Threats are EXTERNAL factors that an organization LIKELY TO face in the near future

1.3 | SWOT AnalysisAdvantages of SWOT analysis

• Can be simple & quick• Wide range of applications• Helps to determine the organization's position in the market and

therefore aids the formulation of business strategy for long-term survival• Encourages foresight & proactive thinking in decision-making• Help reduce risks of decision-making by demanding objective & logical

thinking

1.3 | SWOT Analysis

Disadvantages of SWOT analysis

• Rather simplistic & doesn't demand detailed analysis• Model is static, but business environment is always changing – so shelf

life of SWOT is rather limited• Analysis only useful if decision-makers are open about weaknesses &

willing to act upon them (devote time, money, & people to tackling weaknesses & threats)

• Not typically used in isolation

1.3 | SWOT AnalysisSWOT Analysis can be a good framework for:

• Competitor analysis: e.g. threats posed by a rival or the strengths of a competitor

• Assessing opportunities: e.g. development & growth of the organization• Risk assessment: e.g. the probable effects of investing in a certain project or

location• Reviewing corporate strategy: e.g. the market position or direction of a

business• Strategic planning: e.g. the decision to diversify or expand overseas

1.3 | SWOT AnalysisEXAM TIP!

• A common exam question will require you to examine the position of a business by using a SWOT analysis framework

• On an exam, do not present the SWOT in tabular form. Instead, provide written explanations (bullet points ok)

1.3 | SWOT AnalysisApplication of knowledge

Kidzplay Bouncy Castles is a private business that caters for children's parties and events in London. Explain whether each of the following scenarios represents a strength, weakness, opportunity, or threat:

a. Limited competition in a niche marketb. Limited traffic on its newly launched websitec. Struggling to recruit & retain suitable staffd. Demand in winter months is lowe. Highly profitable earnings could attract new customers






✓ SWOT analysis



1.3 | The Ansoff matrixOBJECTIVE

AO3, AO4

➢ Ansoff matrix for different growth strategies of a given organization.

1.3 | SWOT Analysis

Ansoff matrix (1957)Analytic tool that helps managers to choose & devise various & market growth strategies

1.3 | SWOT AnalysisMarket Penetration

• Low-risk growth activity – sell existing products in existing markets• Might be achieved by offering more competitive prices or through increased advertising• Might attempt to entice customers to buy more frequently (e.g. customer loyalty

programs)• Brands may be repositioned• Advantages: business focuses on markets & products it's familiar with; minimized market

research costs; safest of the strategies• Disadvantages: competitors will retaliate, leading to aggressive reactions like price wars;

once market is saturated, alternative strategies required

1.3 | SWOT AnalysisProduct Development

• Medium-risk strategy – selling new products in existing markets• Product development tends to rely on 1) product extension strategies to prolong

demand for a product that have reached saturation or decline stage and 2) brand development

• Examples: Apple's launch of the iPhone; Nike is able to launch new products because of their well-known brand name

1.3 | SWOT AnalysisMarket Development

• Medium-risk strategy – selling existing products in new markets• e.g. an established product is marketed to a new set of customers• Could be done via:

• New distribution channels (i.e. selling overseas)• Tweaking promotional strategies to make product more appealing to new audience• Prices changed to attract different market segments

• Key advantage: firm is familiar with the product being marketed• Examples: Nike & Adidas marketing sports wear as leisure wear; Nokia selling phones in

lower income countries where consumers don't trade up as often

1.3 | SWOT AnalysisDiversification

• High-risk strategy – selling new products in new markets• Key driving forces: gaining market share in established markets & spread risks by having a well-balanced

product portfolio• Suitable for firms that have reached saturation & are looking for new areas of growth• One way to diversify: become a holding/parent company

• A business that owns a controlling interest in other diverse companies (owns enough shares to be able to take control of other businesses)

• Example: Time Warner (Warner Bros, CNN, HBO, Time Inc)• Two categories:

• Related: caters for new customers in broader confines of the same industry• Unrelated: selling completely new products in untapped markets

1.3 | SWOT AnalysisAnsoff overview

Market Penetration:• Same products for existing customers• Minimal risk• Seek to maintain or increase market share• Intense competition

Product Development:• New products for existing customers• Moderate risk• Innovation to replace existing products• Product improvements

Market Development:• New customers for existing products• Moderate risk• Entering overseas markets• New distribution channels

Diversification:• New products for new customers• High risk• Spreading risks• Use of subsidiaries & strategic business units

1.3 - Organizational Objectives & CUEGIS✓ Vision statements





✓ SWOT analysis



1.3 | Organizational objectives & CUEGISThe use of organizational objectives is the starting point to achieving the vision & mission. Businesses must be able to assess the effectiveness of their objectives – one way to do this is be setting SMART objectives.➢ Specific➢ Measurable➢ Achievable➢ Realistic➢ Time constrained

Monday, October 7th


ENTRY TASKS:Put away your notes, cellphones, & laptops. We'll begin the 1.2 recovery opportunity shortly.

1.3 | Daily Overview✓ 1.2 quiz recovery opportunity✓ Finish 1.3 (Ansoff Matrix, CUEGIS concepts)✓ Introduce 1.3 Assessment: group case study✓ DECA competitive event sign ups, if time






✓ SWOT analysis



1.3 | The Ansoff matrixOBJECTIVE

AO3, AO4

➢ Ansoff matrix for different growth strategies of a given organization.

1.3 | SWOT Analysis

Ansoff matrix (1957)Analytic tool that helps managers to choose & devise various & market growth strategies

1.3 | SWOT AnalysisMarket Penetration

• Low-risk growth activity – sell existing products in existing markets• Might be achieved by offering more competitive prices or through increased advertising• Might attempt to entice customers to buy more frequently (e.g. customer loyalty

programs)• Brands may be repositioned• Advantages: business focuses on markets & products it's familiar with; minimized market

research costs; safest of the strategies• Disadvantages: competitors will retaliate, leading to aggressive reactions like price wars;

once market is saturated, alternative strategies required

1.3 | SWOT AnalysisProduct Development

• Medium-risk strategy – selling new products in existing markets• Product development tends to rely on 1) product extension strategies to prolong

demand for a product that have reached saturation or decline stage and 2) brand development

• Examples: Apple's launch of the iPhone; Nike is able to launch new products because of their well-known brand name

1.3 | SWOT AnalysisMarket Development

• Medium-risk strategy – selling existing products in new markets• e.g. an established product is marketed to a new set of customers• Could be done via:

• New distribution channels (i.e. selling overseas)• Tweaking promotional strategies to make product more appealing to new audience• Prices changed to attract different market segments

• Key advantage: firm is familiar with the product being marketed• Examples: Nike & Adidas marketing sports wear as leisure wear; Nokia selling phones in

lower income countries where consumers don't trade up as often

1.3 | SWOT AnalysisDiversification

• High-risk strategy – selling new products in new markets• Key driving forces: gaining market share in established markets & spread risks by having a well-balanced

product portfolio• Suitable for firms that have reached saturation & are looking for new areas of growth• One way to diversify: become a holding/parent company

• A business that owns a controlling interest in other diverse companies (owns enough shares to be able to take control of other businesses)

• Example: Time Warner (Warner Bros, CNN, HBO, Time Inc)• Two categories:

• Related: caters for new customers in broader confines of the same industry• Unrelated: selling completely new products in untapped markets

1.3 | SWOT AnalysisAnsoff overview

Market Penetration:• Same products for existing customers• Minimal risk• Seek to maintain or increase market share• Intense competition

Product Development:• New products for existing customers• Moderate risk• Innovation to replace existing products• Product improvements

Market Development:• New customers for existing products• Moderate risk• Entering overseas markets• New distribution channels

Diversification:• New products for new customers• High risk• Spreading risks• Use of subsidiaries & strategic business units

1.3 - Organizational Objectives & CUEGIS✓ Vision statements





✓ SWOT analysis



1.3 | Organizational objectives & CUEGISThe use of organizational objectives is the starting point to achieving the vision & mission. Businesses must be able to assess the effectiveness of their objectives – one way to do this is be setting SMART objectives.➢ Specific➢ Measurable➢ Achievable➢ Realistic➢ Time constrained

1.3 | Organizational objectives & CUEGISSignificance of strategic planning

➢ Businesses should recognize the importance of change & be willing to embrace change➢ Businesses should avoid meaningless change, especially because it typically comes

with a high cost➢ Change that is not clearly communicated to employees can cause major demotivation

among the workforce➢ Having clear & realistic objectives with sufficient resources can make success more

likely➢ There is no single organizational objective that is suitable for all businesses to follow

Tuesday, October 8 &Wednesday, October 9


ENTRY TASKS:• Get out your notes for the 1.3 Assessment (group case study)• Choose your official seats!

1.3 | Daily Overview✓ Current Events✓ 1.3 Assessment: group case study✓ DECA competitive event sign ups

1.3 | Case Study✓ You will be put into groups of 4-5.✓ You will work AS A TEAM to answer the corresponding

questions to the two case studies: Fun Air & KDNC✓ Fun Air Q1: SWOT Analysis should be done on 8.5x11 computer

paper & explanation should be written on notebook paper or typed.

✓ KNDC Q1-3: written on notebook paper or typed.

Thursday, October 10th


ENTRY TASKS:1) Be ready to record your Area event(s) + Business Plan with me today2) Which of the following growth strategies is each of these businesses utilizing?• Target – new points-based rewards system• Adidas – new Gardening Club line

https://www.usatoday.com/story/money/2019/10/08/how-target-circle-savings-program-works/3900265002/

https://www.highsnobiety.com/p/adidas-gardening-collection-release-date-price/

1.3 | Daily Overview✓ Pass back 1.2 quiz✓ Begin 1.4: internal & external stakeholders✓ Sign up for DECA competitive events (last 15 minutes of class)

1.3 | Case Study DiscussionFun Air➢ What are some strengths, weaknesses, opportunities, & threats for Fun

Air?➢ Should Jeff be confident about this short-term venture?

KNDC➢ What does it mean if a firm is "ethical & socially responsible?"➢ What are the positive & negative aspects of the decision to accept the

sponsorship from Deval?➢ What are 3 constraints KNDC might experience when implementing?

1.4 - Stakeholders✓ Internal stakeholders

✓ External stakeholders

✓ Stakeholder conflict

✓ Mutual benefits of stakeholders' interests

✓ Stakeholders & the CUEGIS concepts

1.4 | Internal StakeholdersOBJECTIVE


➢ The interests of internal stakeholders.

1.4 | StakeholdersStakeholderAny person or organization with a direct interest in, and is affected by, the activities and performance of a business.

Internal Stakeholders: members of the organization➢ Employees➢ Managers➢ Directors➢ Shareholders

1.4 | StakeholdersEmployees➢ Staff of a business have a stake in the organization.➢ Employees likely to strive for:

• Improve their pay & other financial benefits• Working conditions• Job security• Opportunities for career progression

➢ It's important to meet the needs of employees & involve them in the decision-making process

➢ Unhappy employees = unlikely to produce quality goods, unlikely to provide good customer service, may take industrial action

1.4 | StakeholdersManagers & Directors

➢ Managers: oversee daily operations of a business➢ Directors: senior executives who have been elected by the company's

shareholders to direct business operations on behalf of the owners➢ Both aim to:

➢ Maximize their own benefits (i.e. bonuses, other perks)➢ Maximize profits – which will please shareholders & safeguard top

executives' jobs➢ Senior staff look at long-term financial health of their organization

1.4 | StakeholdersShareholders

➢ AKA: stockholders➢ Limited liability companies are owned by shareholders➢ Invest money in company by purchasing shares➢ Very powerful stakeholder group because they have voting rights and a "say" in how the

company is run➢ Entitled to share of its profits➢ Two objectives:

1. Maximize dividends – portion of the company's profits distributed to shareholders2. Achieve a capital gain in the value of the shares (i.e. rise in share price)

1.4 | StakeholdersShareholders continued...

Some shareholders are internal stakeholders➢ Such as directors or employers who hold shares in the company

Some shareholders are external stakeholders➢ Those who own shares in the company but are not involved in the day-to-

day operations

1.4 | StakeholdersPLEASE NOTE:

Do not use the terms shareholder & stakeholder interchangably.➢ Shareholders are the owners of a company, so only ONE type of

stakeholder.






1.4 | Internal StakeholdersOBJECTIVE


➢ The interests of external stakeholders.

1.4 | StakeholdersStakeholderAny person or organization with a direct interest in, and is affected by, the activities and performance of a business.

External Stakeholders: do not form part of the business, but have a direct interest or involvement in the organization➢ Customers➢ Suppliers➢ Pressure groups➢ Competitors➢ Government

1.4 | StakeholdersCustomers

➢ Customer care is very important in all aspects of business operations➢ Vital for businesses to pay attention to the needs of their customers,

such as better-quality products at competitive prices➢ Businesses use market research to find out what customers want➢ Complaints & suggestions considered by management team

1.4 | StakeholdersSuppliers

➢ Provide a business with stocks of raw materials, component parts, & finished goods needed for production

➢ Also provide commercial services, such as maintenance & technical support➢ Suppliers strive for regular contracts with clients at competitive prices and request

that customers pay bills on time➢ Businesses want positive relationships with suppliers to:

➢ Receive quality products on time & at a reasonable price➢ Receive preferential credit terms

1.4 | StakeholdersPressure Groups

➢ Consist of individuals with a common interest who seek to place demands on organizations to act in a certain way or to influence change in behavior

➢ Have increasingly influenced decisions & actions of businesses directly or by influencing government policy

➢ Example: the community – put demands on businesses to create jobs, want businesses to be accountable for activities, put pressure on businesses to sponsor local fundraising events

➢ Other examples: Friends of the Earth, Greenpeace, PETA

1.4 | StakeholdersPossible Actions Taken by Pressure Groups

➢ Boycotting➢ Lobbying➢ Public Relations➢ Direct Action

1.4 | StakeholdersCompetitors

➢ Interested in activities of a rival business for several reasons:▪ Gives incentive to be innovative and/or produce new products▪ To remain competitive▪ To benchmark performance

➢ Examples: Coca-Cola vs Pepsi, Boeing vs Airbus, McDonalds vs Burger King

1.4 | StakeholdersGovernment

➢ Can have a significant influence on business activity, including assurances such as:▪ Unfair businesses practices are avoided▪ Correct amount of corporate tax is paid from net profits▪ Health & safety standards at work are met▪ Compliance with employment legislation occurs▪ Consumer protection laws are upheld

➢ May also have financial stake

1.4 | StakeholdersGovernment

➢ Aims to ensure businesses act in the public interest:▪ Lower interest rates and/or taxes to create employment & investment

opportunities▪ Offer incentives to multinational companies to locate in their country (ex:

subsidized rent)▪ Introduce initiatives that benefit organizations (ex: investment in road building)

➢ Can also constrain businesses (ex: law suits for malpractice or unfair competition)

FriYAY, October 11th


ENTRY TASKS:1) Be ready to record your Area event(s) + Business Plan with me today if you haven’t already2) Read the article about the Salesforce purchase of Tableau. Identify how this purchase could've affected the different types of internal & external stakeholders. We'll discuss as a class.3) Get out your first DECA BP section.

1.3 | Daily Overview✓ Reminder: Flex Time offerings for next 3 weeks✓ Collect first section of DECA Business Plan✓ Begin 1.4: stakeholder conflict & mutual benefits of stakeholders'

interests✓ Sign up for DECA competitive events (last 10-12 minutes of class)

1.3 | DECA Business Plan – first section turn-inBefore turning in your first section of your Business Plan, please:Write one question that you have for me about the section.

➢ Be specific. "I'm not sure if this statistic effectively depicts the problem that my product/service is addressing. What do you think?"

➢ Unacceptable answers: Is this section good? Is this section bad? How can I improve this section to make sure I go to State?






1.4 | Stakeholder ConflictOBJECTIVE


➢ Possible areas of conflict between stakeholders' interests.

1.4 | StakeholdersBecause different stakeholder groups have varying interests in a business, it is likely that conflict will arise.

➢ Conflict arises because a business cannot simultaneously meet the needs of all its stakeholders.

➢ Example 1: Shareholders want more profit so they cut staff benefits. Employees are upset.

➢ Example 2: Suppliers want customers to pay full price for a transaction to improve their cash flow. Businesses expect to receive discounted prices for buying in bulk or regular purchases.

➢ Think of another example of potential stakeholder conflict.

1.4 | StakeholdersCommon cause of stakeholder conflict: Renumeration (pay & benefits) of the company's directors

➢ Shareholders & employees may argue that top management are "overpaid." They may think that profit should be more fairly distributed –in dividends to shareholders & in improved pay to staff.

➢ Senior executives may argue that their compensation needs to be adequate to pay for the higher risks involved in decision-making. They might think that this will ultimately increase profits for the business, leading to higher wages & dividends.

1.4 | StakeholdersCommon cause of stakeholder conflict: Some stakeholders have more than one role or set of interests in an organization

➢ Managers are employees too➢ Some employees are also shareholders➢ Customer also likely a member of the local community (pressure group)

1.4 | StakeholdersWhen deciding how to deal with conflicting stakeholder needs, leaders need to look at 3 key issues:

➢ The type of the organization➢ The aims & objectives of the business➢ The source & degree of power/influence of each stakeholder group






1.4 | Mutual benefits of stakeholders' interestsOBJECTIVE


➢ Possible areas of mutual benefit between stakeholders' interests.

1.4 | StakeholdersStakeholder conflict is essentially an ever-present phenomenon.

➢ Modern management thinking suggests that there are mutual benefits in simultaneously meeting the competing needs of different stakeholders.

➢ Might only occur in the medium to long term.

Address needs of managers & employees

Highly motivated & productive staff

Improved customer relations, corporate image, market share, and profits

Shareholders are pleased

1.4 | StakeholdersStakeholder mappingA model that assesses the relative interest of stakeholders and their relative power (or influence) on businesses.

➢ Lets managers assess how to deal with changing & conflicting stakeholder objectives

➢ Managers can use this tool to prioritize actions

1.4 | Stakeholders

➢ Low interest & Low influence: minimum effort, low priority

➢ Low interest & High influence: keep satisfied➢High interest & Low influence: keep informed➢High interest & High influence: manage

closely, maximum effort, #1 priority

1.4 | Reminders✓ Continue to work on your Business Plan.✓ No school Monday.✓ I'll be out Tuesday & it'll be a Business Plan work day. Bring your

laptop if you can.✓ PSAT testing Wednesday. No class.✓ Sign up for my Flex Time(s) if needed! See FlexiSched for

offerings.

Documents

Monday, September 9 - Weebly