Week 01 Understanding Business System And Environment
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Transcript of Week 01 Understanding Business System And Environment
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Understanding Business and Environment
Week 1
Content :
Concept of business, profit, and production
Exclusively prepared & presented by: Anna Riana Putriya e-mail: [email protected]
Environment
Jakarta, September 2008
Business environments
profit, and production
Economic systems
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The concept of business & the concept of profit
• Business is an organization that provides goods or services to earn profits
• Profits represent the difference between a business’s revenues and its expenses
Content :
Concept of business, profit, and production
Exclusively prepared & presented by: Anna Riana Putriya e-mail: [email protected]
business’s revenues and its expenses profit, and production
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What are factors of production?
Content : Resources used in the production of goods and services—labor, capital, entrepreneurs, physical resources and information resourcesConcept of business,
profit, and production
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profit, and production
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Factors of production
1. Labor / Human resources / Intelectual Capital
2. Capital
3. Entrepreneur
4. Physical resources
Content :
Concept of business, profit, and production
Exclusively prepared & presented by: Anna Riana Putriya e-mail: [email protected]
5. Information resources
Can you name any others ?
profit, and production
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Economic systems around the world
Content :An economic system is a nation’s system for allocating
its resources among its citizens.
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Economic systems
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1. Planned Economy
Content : Relies on a centralized government
to control all or most factors of
production and to make all or most
production and allocation decisions.
The Kremlin is shown above.
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Economic systems
The Kremlin is shown above.
What is Communism?
Planned economy in which the government
owns and operates all factors of production
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2. Market Economy
Content :
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Economic systems
Relies on individuals to control production and allocation decisions through supply and demand
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Content :
Circular Flow in a Market Economy
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Economic systems
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3. Mixed Market Economy
Content : Features characteristics of both planned and market economies
• Privatization is the process of converting government enterprises into privately owned companies
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Economic systems
owned companies
• Socialism is a partially planned system in which the government owns and operates selected major industries
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The Laws of Supply and Demand
Content : The law of demand:Buyers will purchase (demand) more of a product as its price drops and less as its price increases.
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Economic systems
The law of supply:
Producers will offer (supply) more of a product for sale as its price rises and less as its price drops.
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Evolution in Business
Content :
Laissez-Faire &
Production Era Marketing Era
Global Era
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Economic systems
Industrial Revolution
Laissez-Faire & Entrepreneurship Era
Global Era
Information & Internet Era
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Organizational Boundaries
Content :That which separates the organization from
its environment
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Business environments
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Dimensions of the External Environment
Content :
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Business environments
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1. Economic environment
Content :• Economic Growth
– Aggregate Output and Standard of Living
– Gross Domestic Product (GDP) & Gross National Product (GNP)
• Purchasing Power Parity
– Productivity
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Business environments
– Balance of Trade
– National Debt• Economic Stability
– Inflation
– Unemployment
• Recessions and Depressions
• Global economy in 21st century
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The global economy in the 21st century
Major forces driving the economy:
– The information revolution will continue to enhance productivity
across all economic sectors.
– New technological breakthroughs will create entirely new industries.
Content :
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– Increasing globalization will create much larger markets while
fostering tougher competition among global businesses.
Business environments
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2. Socio cultural environment
Conditions including the customs, mores, values and demographic
characteristics of the society in which an organization functionsContent :
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Business environments
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Customer Preferences and Tastes
• Customer preferences and tastes vary both across and within
national boundaries.
• Consumer preferences can vary widely within the same country.
• Consumer preferences and tastes change over time.
Content :
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• Consumer preferences and tastes change over time.
Business environments
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3. Business environment
• Core competencies
• Outsourcing
• Viral marketing
Content :
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• Viral marketing
• Business process management
Business environments
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thank you
Content :
Concept of business, profit, and production
Exclusively prepared & presented by: Anna Riana Putriya e-mail: [email protected]
thank you
Business environments
Economic systems
profit, and production