What Students Should Understand for Each Chapter Major Themes for Business 101 Fall 2008

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1 What Students Should Understand for Each Chapter Major Themes for Business 101 Fall 2008 Chapter 1 Understanding the Canadian Business System 1. Students should understand how government affects business, and how a country s economic system affects business. 2. Students should understand the concepts of supply and demand, and equilibrium outcomes. 3. Students should know the different degrees of competition, and how those degrees of competition affect how businesses compete with one another. Chapter 2 Understanding the Environments of Business 1. Students should understand the concepts of organizations, environments and boundaries 2. Students should be able to explain the importance of the economic environment to business and be conversant 1 with the terminology frequently used in the news to describe the performance of the economy. 3. Students should understand the various types of environments (technological, political-legal and socio-cultural) and the role they play in business. 4. Students should know how to analyze an industry using Porter s 5-Forces model, and should also understand the advantages and disadvantages of outsourcing. Chapter 3 Conducting Business Ethically and Responsibly 1. Students should understand why ethical behavior is important in the workplace and know how to assess and debate ethical behavior. 2. Students should be familiar with the social responsibilities that businesses have towards the environment, towards customers, towards employees and towards investors. 3. Students should understand current methods used by companies to promote ethical behavior. 1 This document frequently uses the term conversant. The word means able to converse knowledgeably. Therefore, to be conversant with the terminology, students need to be able to do much more than recite a definition. (In fact, our tests are unlikely to ask for a definition.) Students need to understand the concept of the term, the logic of the concept, and the role that the concept plays in the bigger picture.

2 Chapter 4 Understanding Entrepreneurship, Small Business, and New Venture Creation 1. Students should understand the meaning and interrelationships of the following terms: small business, new venture creation and entrepreneurship. 2. Students should be able to explain the following important elements of becoming an entrepreneur: identifying opportunities; assessing resources; and assessing the fit between the entrepreneur, the opportunity and the resources. 3. Students should understand key issues concerning a start-up such as entry issues (buying an existing business versus starting from scratch versus franchising or licensing), and key determinants of success or failure. 4. Students should know the forms of business organization (sole proprietorships, partnerships and corporations) and should know how to evaluate which form is most suitable for a given Chapter 5 The Global Context of Business 1. Students should be conversant in the terminology commonly used when discussing international competitiveness and international commerce. 2. Students should understand the factors involved in deciding to do business internationally, know the various ways that companies conduct international business, and should be able to assess which methods make sense for a given 3. Students should know the barriers to international trade, and should understand what political efforts have been made to overcome some of those barriers. Chapter 6 Managing the Business Enterprise 1. Students should be conversant with the terms frequently used in strategic planning, and understand the importance of setting goals and formulating strategies as the starting points of effective management. 2. Students should be familiar with the core functions of management, and the different types of managers that exist, including terms that refer to their level in the organization, and terms that refer to their area of management. 3. Students should know what skill sets are required to be an effective manager, and why those skills are important. 4. Students should understand the meaning and importance of corporate culture and how that culture is developed.

3 Chapter 7 Organizing the Business Firm 1. Students should understand traditional organizational structures. They should know the purpose of them, the common bases of organization (e.g. functional, geographic, product, etc.), and the issues that affect how best to organize a firm. 2. Students should understand the concepts of specialization and departmentalization and how they serve as the building blocks of organizational structure. 3. Students should be able to distinguish between responsibility and authority and explain the differences in decision making in centralized and decentralized organizations. 4. Students should also understand how and why many firms are adopting new approaches to organizational design, including some of the major trends. Chapter 8 Managing Human Resources and Labor Relations 1. Students should know the techniques (and their purposes) that are commonly used in employee recruitment, skills development and performance appraisal. Students should be able to identify what techniques are appropriate for a given 2. Students should be familiar with the different forms of compensation, and should be able to identify appropriate forms of compensation for a given 3. Students should know the key legal considerations in human resource management. 4. Students should understand the role of unions and collective bargaining. They should know what unions objectives and tactics are, and should understand what management s objectives and tactics are. Chapter 9 Motivating, Satisfying, and Leading Employees 1. Students should know the theories and strategies of motivation covered in this course. They should be able to explain how these theories and strategies apply (or don t apply) in a particular 2. Students should know the managerial/leadership styles that one might encounter. They should also know the advantages and disadvantages of each style in a given context. Chapter 10 Operations Management and Quality Control 1. Students should be conversant with the terminology commonly used when addressing production and operations. 2. Students should know and understand the techniques that are commonly used to achieve efficient and effective operations. 3. Students should be able to identify the characteristics that distinguish service operations from goods production and explain the main differences in the service focus.

4 Chapter 11 Understanding Accounting 1. Students should know the purpose of accounting, and should understand the differences between financial accounting, managerial accounting and auditing. 2. Students should know the basics required to read and interpret financial statements. a. Regarding the balance sheet, students should know its purpose, the organizational structure of it, and the elements (and their meaning) found on a typical balance sheet. b. Similarly, students should know the purpose, structure and elements of the income statement. c. Students should understand why the statement of cash flows is not the same as an income statement. 3. With a given set of financial statements, students should be able to compute the commonlyused ratios, and should understand why those ratios are useful and significant. Chapter 12 Understanding Marketing Processes and Consumer Behavior 1. Students should be able to explain the concept of marketing and the purpose of a marketing plan including the four components of the marketing mix. 2. Students should understand what segmentation is, what its purpose is, and how markets can be segmented. 3. Students should also understand the purpose of research and what methods are used. 4. Students should be familiar with the customer s buying process (remember that the customer may be an end consumer, an intermediary or another business) and should understand how the buying process matters to a business marketing activities. Chapter 13 Developing and Promoting Goods and Services 1. Students should understand the term product, be able to distinguish between consumer and industrial products, and explain the product mix. 2. Students should be familiar with the process of developing new products, should understand the product life cycle, and should understand the roles of brands, trademarks, patents and copyrights. 3. Students should know the common strategies and techniques used in promotion, and should be able to rationalize which strategies and techniques make most sense in a particular

5 Chapter 14 Pricing and Distributing Goods and Services 1. Students should know the main pricing strategies and tactics, and the logic underlying those strategies. They should be able to rationalize which strategies are most suitable in a particular 2. Students should be able to compute mark-up percentages, and should be able to perform and interpret a break-even analysis. 3. Students should be conversant in the terminology commonly used in distribution. They should be able to identify methods of distribution that make sense in a particular 4. Students should understand the differences between retailers, wholesalers and agents/brokers. 5. Students should understand the different forms of transportation and explain how distribution can be used as a marketing strategy. Chapter 15 Money, Banking and Securities Markets 1. Students should be conversant in the terminology commonly used when talking about banks and other financial institutions. 2. Students should be conversant in the terminology commonly used when talking about stocks and bonds. Chapter 16 Financial Decisions and Risk Management 1. Students should understand the responsibilities of a financial manager. 2. Students should understand why firms need short-term financing, and should know the main sources of short-term financing. They should also understand the types of conditions lenders often impose. 3. With respect to long-term financing, students should know the advantages and disadvantages of debt versus equity financing. They should be able to evaluate which form of financing makes most sense in a particular As part of all this, students should understand the concept of leverage. 4. Students should be able to discuss some issues in financial management for small businesses. 5. Students should be able to understand how risk affects business and the primary ways that businesses cope with that risk.