Business and Economics Chapter 1

Study Notes

A business's aim is to provide goods and services for profit, encompassing both tangible (e.g., electronics) and intangible (e.g., services like education) aspects.
Consumers purchase products mainly for the satisfaction they provide, not just the item itself.
Examples include fitness trackers promoting health and Jeeps conveying a lifestyle image.

The primary objective of any business is profit, defined as the revenue generated minus operational costs.
Companies must manage expenses, including salaries and other costs, to ensure profitability while balancing social responsibilities.
Non-profit organizations focus on social missions rather than profit, relying on donations and grants for funding. They have different management strategies compared to for-profits.

Profitable organizations depend on skilled employees, particularly in management, marketing, and finance.
Management skills are crucial for planning, organizing, and leading activities, as well as developing a workforce to meet consumer needs.
Marketing skills help identify consumer demands and inform decisions on manufacturing, pricing, promotion, and distribution.
Financial skills are essential for resource management, budgeting, and adhering to regulations.

Internal stakeholders include investors, employees, and customers who are invested in the company’s success; businesses must ensure job security and promote diversity within their workforce.
External stakeholders, such as suppliers and the community, highlight businesses' broader social and environmental impacts.
There is a growing trend towards sustainability, exemplified by Microsoft's goal of achieving zero waste by 2030, targeting 90% landfill waste diversion.

Management connects effectively with employees, emphasizing leadership, decision-making, and task delegation.
Successful management involves high-quality personnel management and open communication to boost operational efficiency.
Efficient management transforms resources, including employee skills, into improved service quality for customers, as illustrated by Peloton.

Marketing focuses on satisfying consumer needs through effective product promotion and distribution.
Key decisions in marketing management revolve around product attributes, pricing, distribution channels, and promotional strategies.
The marketing mix (product, price, place, and promotion) is essential for attracting consumers and differentiating products in competitive markets.