EEM3366_Day_school1_Presentation_Slides.pptx

Introduction Session EEM3366 – Introduction to Business Studies Centre for IT Education Services (CITES) The Open University of Sri Lanka 25.02.2022  Acknowledgement This presentation was prepared by K. V. Jeeva Padmini K.D.B Arat...

Introduction Session EEM3366 – Introduction to Business Studies Centre for IT Education Services (CITES) The Open University of Sri Lanka 25.02.2022  Acknowledgement This presentation was prepared by K. V. Jeeva Padmini K.D.B Aratthanage Centre for IT Education Services (CITES)  ▪ Credits :3 (148 hours) ▪ Course Materials :Book 1 ▪ Pre-requisites: None ▪ Continuous Assessment Activities TMA – 03 CAT – 02 MP – 01 ▪ Eligibility Criteria : AVG(TMA) * 0.2 + AVG(CAT) *0.4 + (MP) * 0.4 >= 40 And (MP) >= 40 ▪ Final Examination : ▪ Essay Type questions -3 hours, if X ≥ 40 Centre for IT Education Services (CITES) Recommended Learning; Handy, C.B., 2005, Understanding Organizations (4th edition) Waomack, J., Jones, D., Lean Thinking (new edition) Worthington, I., C Britton, C., The Business Environment (6th edition) Jewels , B.R., An integrated approach to business studies. Students’ Book 4thedition Easton, G., Learning from case studies 2ndedition Kotler, P., Keller, K., Marketing Management Atrill, P. McLaney, E., Accounting and Finance for Non- specialists (6th edition) Centre for IT Education Services (CITES) Syllabus outline Unit 1 – Overview of Business Studies Understand the business environment from an ethical, socially and globally responsible perspective. Recognize the various forms of business ownership opportunities. Recognize the potential conflict between objectives, and the solution of such conflicts. Understand the nature of the uncertain business environment and the development of business plans of action which aim to respond effectively to the changing business environment. Understand how businesses might have to change their behavior when influenced by specific constraints such as legal framework. Centre for IT Education Services (CITES) 5 Syllabus outline Unit 2 – Organizational Behaviour Demonstrate knowledge of management and organizational structure, including human resources practices that support the business. Understand the role of various management, leadership and motivation theories should be developed in a practical way. Recognize the key differences in management styles Discuss the important contributions of motivational theorists and their relevance to business today. Understand the different payment systems used in business today. Appreciate the relationships between human resource management, staff motivation and staff welfare in a business organization. Centre for IT Education Services (CITES) 6 Syllabus outline Unit 3 – Marketing Understand the importance of effective marketing including social media and e- business. Understand what marketing is and the role of marketing in modern societies. Understand the business situations with process of finding and satisfying customers, with the focus also on how marketing objectives can be met. Recognize marketing concepts to develop strategies and evaluate changing situations/options Centre for IT Education Services (CITES) 7 Syllabus outline Unit 4 – Operational Management Understand the importance of effective marketing including social media and e- business. Understand what marketing is and the role of marketing in modern societies. Understand the business situations with process of finding and satisfying customers, with the focus also on how marketing objectives can be met. Recognize marketing concepts to develop strategies and evaluate changing situations/options Centre for IT Education Services (CITES) 8 Syllabus outline Unit 5 – Introduction to Accounting Utilize and evaluate financial and accounting data for business operations. Understand the concepts of finance and cash flow problems will be expected. Understand the analysis of tactical solutions to finance and cash flow problems. Recognize how to aid strategic decision making and to evaluate the performance of a business and business investment projects in financial terms. Centre for IT Education Services (CITES) 9 Overvie w of Business Studies Centre for IT Education Services (CITES) 10 What are the buzzwords in nowadays? (Mentimeter Activity) Centre for IT Education Services (CITES) 11 Coronavirus (COVID -19) Centre for IT Education Services (CITES) 12 Centre for IT Education Services (CITES) 13 Centre for IT Education Services (CITES) 14 Businesses launch innovative products to battle Covid-19 Centre for IT Education Services (CITES) 15  Business ideas inspired due to pandemic situation Centre for IT Education Services (CITES) 16  Business ideas inspired due to pandemic situation Centre for IT Education Services (CITES) 17 Distinguishing between wants and needs during Distinguishing between wants and needs during the coronavirus pandemic the coronavirus pandemic Centre for IT Education Services (CITES) 18  Human Needs and Wants Centre for IT Education Services (CITES) 19  Basic Human Needs and wants A need is something that is necessary for an organism to live a healthy life. Wants are defined as something that a person would like to possess, either immediately or later. Centre for IT Education Services (CITES) 20 Keys to business success 1.The basic business idea What business is, the person entering and what will be sold? Ex: It may be better to sell ‘high quality and performance sports shoes’ rather than just ‘trainers’. What would be a good business idea when consider the pandemic situation in the country? Centre for IT Education Services (CITES) 21 Keys to business success 2. Finding out about the market How many products exist already? Ex: Customers may prefer other types of shoes for fashion wear or a different type of design. What are the strengths and weaknesses of the competition? You all are going to introduce a new sanitizer. Let’s answer these questions and find out about the market? Centre for IT Education Services (CITES) 22 Keys to business success 3. Marketing and promotion What price can be charged? It may be possible to undercuts competitors’ prices or sell initially at less than unit cost until the product begins to sell well. Centre for IT Education Services (CITES) 23 Keys to business success 4. People What are the main skills needed to run the business? What skills are needed to manufacture the product? 5. Finance How much money is needed to start up? The business person will need to work out the costs of setting up, eg. Rent and rates, wages, machinery, sales and distribution costs and professional fees. 6. Coordination So that all the functional areas (fiancé, marketing, operations, HRM) work together to achieve corporate objectives. Centre for IT Education Services (CITES) 24 Why startups-fail? Centre for IT Education Services (CITES) 25 Top 10 Startup Failures of 2021 https://techcrunch.com/2021/12/27/ remembering-the-startups-we-lost-in- 2021/ Centre for IT Education Services (CITES) 26 Purpose Business Activity Centre for IT Education Services (CITES) 27 Centre for IT Education Services (CITES) 28 Factors of Production Resources necessary to produce goods and services. Centre for IT Education Services (CITES) 29 Centre for IT Education Services (CITES) 30  Business Objectives Goals of the business. The objectives of a business can be derived from its aims. Hierarchy of objectives Centre for IT Education Services (CITES) 31  Key Business Objective Value added is the difference between the price at which goods or services are sold and the cost of raw materials. Profit is the difference between the price at which goods or series are sold and all costs of production. Centre for IT Education Services (CITES) 32 D.S Activity 1.2 – 10 minutes Take a paper. Set up into groups. Discuss and write down followings. 1.What is the difference between vision and mission of a business. 2.Give an example. 3.Discuss hierarchy of business objectives and listed examples. 4.Create a discussion forum under the class discussion and discuss. 5.Put your group members Reg. numbers at the chat. Centre for IT Education Services (CITES) 33  Stakeholders in business Stakeholders are the group of people or the individual who have interest in the activities of organization. Each of the types of stakeholders in a business are categorized in 3 ways: ❑ Internal or External ❑ Primary or Secondary ❑ Direct or Indirect Centre for IT Education Services (CITES) 34 Internal & External Stakehold ers Centre for IT Education Services (CITES) 35 Primary & Secondary Stakehold ers Centre for IT Education Services (CITES) 36  Direct & Indirect Stakehold ers Centre for IT Education Services (CITES) 37  10 different types of stakeholders Communities are major stakeholders in businesses because each party (your business and the community) are mutually beneficial in different ways than, say, a supplier and your business. Government agencies can also be thought of as a major stakeholder in a business. They collect taxes from the company, its employees, and from other spending the company does. Creditors lend money to businesses, and they have a secured External or Internal? interest in the company’s worth. Creditors get paid back from the sale of products or services at your business. In the event of Direct or Indirect? a business shutdown, creditors get paid before stockholders. Primary or Secondary? Centre for IT Education Services (CITES) 38 The 10 Types of Stakeholders That You Meet in Business (activecampa ign.com) Centre for IT Education Services (CITES) 39 Shareholder and Stakeholder Centre for IT Education Services (CITES) 40  Opportunity Cost For a new business the two most important resources are money and time. Both have an opportunity cost. Opportunity cost -> the benefits foregone of the next best alternative. Every business decision has an opportunity cost, measured in time, money and often both. The main circumstance in which opportunity cost arises is when an entrepreneur has two ideas. One should be chosen, and one rejected. After evaluating the two options carefully, the weaker of the two should be stopped completely. The reason is simple; opening one business is tough enough; two would be impossible. In business there are many occasions when one factor has to be traded off against another. Centre for IT Education Services (CITES) 41 Business Case Amelia uses $7 t buy smoothie at the mall. She notes that many people would view the choice as one based on whether you want the drink or not. Instead, Amelia suggests wearing “a unique pair of ‘economist glasses’” to see the decision differently, asking: 1.How much do I value this? 2.What am I giving up now to have this? 3.What am I giving up in the future to have this now? Centre for IT Education Services (CITES) 42 Business Case Amelia uses $7 t buy smoothie at the mall. She notes that many people would view the choice as one based on whether you want the drink or not. Instead, Amelia suggests wearing “a unique pair of ‘economist glasses’” to see the decision differently, asking: 1.How much do I value this? 2.What am I giving up now to have this? 3.What am I giving up in the future to have this now? Centre for IT Education Services (CITES) 43 Opportunity Cost Centre for IT Education Services (CITES) 44 Organization in its environment Technologica Social/ l variables Culture Custome r Economi c Competit Demographi Employe or 2nd Level c e Organisati on Macro Shareholde rs Environment 1st Level Global Media Special interest Ecologic groups Political al Centre for IT Education Services (CITES) 45 Business Structure Businesses must have a legally recognized formal structure. There are various possibilities linked to business size, finance requirements and the type of product and market. Economic sectors: Economic activity can be divided into three sectors, each one with industries of a particular type. Businesses generally operate in one of the following three sectors. Public and Private Sectors: One way to classify organizations is whether they operate in the private sector of the economy. The Private sector is made up of organizations that are owned and run by one or more private individuals or other groups Centre for IT Education Services (CITES) 46 Economic Sector Primary Sector Extracts Raw Materials Secondary Sector Manufactures and Assembles Goods Tertiary Sector Refers to Commercial Services Centre for IT Education Services (CITES) 47 Primary Sector Extracts Raw Materials Primary sector of the economy can be classified as the "extractive" industry. These include the industries that produce or extract raw materials. Examples: farmers - primary sector workers food items are collected as raw materials wheat and milk and are taken from the farm and made into other products such as bread and cheese. Mining, such as coal, iron ore or oil, which extract the raw materials from the ground. Centre for IT Education Services (CITES) 48 Secondary Sector Manufactures and Assembles Goods Comprised of the manufacturing industries which take raw materials and produce products. Example: steel used to manufacture cars. carpenters take wood and make homes furniture and cabinetry. semi-manufacturing companies produce parts to be used in other products that have several stages of production. Centre for IT Education Services (CITES) 49 Tertiary Sector Refers to Commercial Services The tertiary sector of the economy is the service industry. Service companies do not provide a physical good like the primary or secondary sectors. They still provide value. Example: banks, insurance and the police Centre for IT Education Services (CITES) 50 NEW SERVICE BASED SECTOR- Quaternary sector In the extended model, the quaternary sector describes the knowledge-based part of the economy, which typically includes knowledge- oriented economic sectors such as information technology. Example: telephone banking and home delivery shopping using the internet. Centre for IT Education Services (CITES) 51 Chain of production The sectors all work together to create an economic chain of production. The primary sector gathers the raw materials, The secondary sector puts the raw materials to use, Tertiary sector sells and supports the activities of the other two. Many companies will have components of all three sectors. Example: A dairy farmer who makes cheese and ice cream and distributes the products to stores for sale. Centre for IT Education Services (CITES) 52 Occupation by Sector Centre for IT Education Services (CITES) 53 Public and Private Sectors Centre for IT Education Services (CITES) 54 Private Sector One way to classify organizations is whether they operate in the private sector of the economy. The Private sector is made up of organizations that are owned and run by one or more private individuals or other groups. Centre for IT Education Services (CITES) 55  Public Sector The Public sector is made up of organizations which are owned and run by national or local govt. Examples : Rupavahini The Central Bank Departments Authorities General hospitals Public schools. Centre for IT Education Services (CITES) 56  Legal structure of business organisation – the private sector Centre for IT Education Services (CITES) 57  Size Of Business Measurement of business size 1.Sales turnover 2.Number of employees 3.Capital employed 4.Market share 5.Market capitalisation 6.Other: agriculture – land area, hospitals – no. of rooms or no. of customers Centre for IT Education Services (CITES) 58 D.S Activity 1.3 – 10 minutes Group exercise. You need to select a measurement type in the business size.(Ex. Number of employees). You need to select an industry (Software development industry). Identify the existing categorization. Identify examples for the selected categorization. Centre for IT Education Services (CITES) 59  Impact made to the society in positive way. Corporate Organisation take pure air, energy, environment, Social human life best time, etc., Responsibili Ex; Sponsoring for sports competitions ty (CSR) Cultural activities Campus reach Building and handing over goods to schools Centre for IT Education Services (CITES) 60  Ethics Study of the rights – Who is benefited or should be benefited or harmed by an action. Personal Ethics Business Ethics Professional Ethics Environmentally friendly Business Ethics products and packaging Fair treatment of employees Unethical business practices Safe and healthy Managers lying to employees products for use. Taking credits for others work Ex. Toxic paint for children Divulging confidential information or trade secrets Centre for IT Education Services (CITES) 61 Thank you PO Box 21, Nawala, Nugegoda, Sri Lanka Phone: +94 11 288 100 www.ou.ac.lk