Notesale: Turn your study into money

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UNIT 3: STRATEGIES FOR SUCCESS: KEY WORDS
Chapter 1:
Objectives: goals or targets that must be achieved in order to realise the stated aims of an
organisation, department or individual team
...

Corporate objectives: the goals or targets of the whole organisation, usually based on its mission or
aims
...

Strategy: the medium- to long-term plans through which an organisation aims to attain its
objectives
...

Financial objectives: the specific, focused targets of the finance and accounting function or
department within an organisation
...

Financial tactics: short-term financial measures adopted to meet the needs of a short term threat or
opportunity
...

Income statement: an account showing the income and expenditure (and thus the profit or loss) of a
firm over a period of time (usually a year)
...

Financial accounting: the provision of financial information to show external users the financial
position of the business, it concentrates on historical data
...

Non-current assets: resources that can be used repeatedly in the production process, although they
do wear out (depreciate) or lose value
...

Tangible assets: non-current (fixed) assets that exist physically
...
g
...

Current assets: short-term items that circulate in a business on a daily basis and can be expected to
be turned into cash within 1 year
...

Total equity or total shareholder’s equity (capital): funds provided by shareholders to set up the
business, fund expansion and purchase fixed assets
...

Capital expenditure: spending on non-current (fixed) assets – those assets used repeatedly in the
production process such as buildings, vehicles and machinery
...

Obsolescence: when an asset is still functioning but it is no longer considered useful because it is out
of date
...

Liquidity: the ability to convert an asset into cash without loss or delay
...
The most liquid asset a business can possess is cash
...

Gross profit: revenue minus cost of sales
...

Operating profit: the revenue earned from everyday trading activities minus the costs involved in
carrying out those activities
...
In practice, this is unlikely to happen as some profit will be retained in the
business
...

Profit quality: a measure of whether profit is sustainable in the long run
...

Profit utilisation: the way in which a business uses its profit or surplus
...

Chapter 4:
Ratio analysis: a method of assessing a firm’s financial situation by comparing two sets of linked
data
...
A firm that can meet its financial
commitments is described as ‘solvent’; a firm that cannot meet its financial commitments is
described as ‘insolvent’
...

Retained profit: the part of a firm’s profit that is reinvested in the business rather than distributed
to shareholders
...

Ordinary share capital: money given to a company by shareholders in return for a share certificate
that gives them part ownership of the company and entitles them to a share of the profits
...

Debenture: a long-term loan made to a business at an agreed fixed percentage rate of interest and

repayable on a stated date
...

Bank overdraft: when a bank allows an individual or organisation to overspend its current account in
the bank up to an agreed (overdraft) limit and for a stated time period
...
g
...

Chapter 6:
Investment decision making: the process of deciding whether or not to undertake capital
investment (the purchase of non-current assets) or major business projects
...

Payback period: the length of time that it takes for an investment to pay for itself from the net
returns provided by that particular investment
...

Net present value (NPV): the net return on an investment when all revenues and costs have been
converted to their current worth
...

Marketing objectives: the specific, focused targets of the marketing function within an organisation
...

Marketing tactics: short-term marketing measures adopted to meet the needs of a short-term
threat or opportunity
...

Sales forecast: a prediction of the level of sales revenue for individual products or for the
organisation as a whole
...

Test marketing: the introduction of a product to a certain geographical area, in order to assess its
likely success or the effectiveness of the marketing methods being used
...
For example, a weekly moving average will cover the data recorded over a 7 day period
...

Trend: the underlying pattern of change indicated within a set of numerical data
...

Moving averages: statistics used to analyse trends in any recent past so that a firm can predict
future sales (through extrapolation)
...

Correlation: a statistical technique used to establish the strength of the relationship between two
sets of values
...
These are often

described as ‘hunches’, but are influenced by the personal knowledge and experiences of the
individuals who are involved in the forecasting
...

Unique selling point (USP): a feature of a product or service that allows it to be differentiated from
other products
...

Marketing budget: the amount of money that a firm allocates to spend on marketing activities
...

Chapter 11:
Operations management aims: the broad, general goals of the operations management function
within an organisation
...

Operations management strategies: long-term or medium-term plans, devised at senior
management level, and designed to achieve the firm’s operations management objectives
...

Chapter 12:
Economies of scale: the advantages that an organisation gains due to an increase in size
...

Diseconomies of scale: the disadvantages that an organisation experiences due to an increase in
size
...

Capital-intensive production: methods of production that use a high level of capital equipment in
comparison to other inputs
...

Chapter 13:
Innovation: the successful exploitation of new ideas
...

Research and development (R&D): the scientific investigation necessary to discover new products
or manufacturing processes, and the procedures necessary to ensure that these new products and
processes are suited to the needs of the market
...

Industrial inertia: the tendency for firms to remain where they are, even though the original reasons

for location no longer apply
...

External diseconomies of scale: the disadvantages arising from the concentration of an industry in
one location
...
These sites may be within one country or located in many different
countries
...

Outsourcing: where companies give responsibility for some of their activities, such as IT support,
catering or manufacturing processes, to other businesses
...

Protectionism: a decision by a country or countries to place restrictions on trade between nations,
in order to help (protect) domestic firms competing with foreign companies
...
This leads to quicker response times, faster
new product development and reductions in waste, culminating in greater efficiency
...
The main form of network analysis is critical path
analysis
...

Critical path: the sequence of activities in a project that must be completed within a designated time
in order to prevent any delay in overall completion of the project
...

Float time: the amount of time that non-critical activities within a project can be delayed without
affecting the deadline for completion of the projects as a whole
...

Lean production: production based on the range of waste-saving measures inspired by Japanese
manufacturing companies
...
The ultimate aim is to eliminate the need for
stock, although in practice that is not always ideal
...
These changes are invariably suggested by
employees and emanate from a corporate culture that encourages employees to identify potential
improvements
...


Hard HR strategy: this strategy treats employees as a resource, just like any other resource, to be
monitored and used in an efficient manner in order to achieve the strategic objectives of the
organisation
...

Chapter 17:
Workforce planning: the method by which a business forecasts how many and what type of
employees I needs now and in the future, and matches up the right type of employee to the needs
of the business
...

Chapter 18:
Organisational structure: the relationship between different people and functions in an organisation
– both vertically, from shop-floor workers through supervisors and managers to directors, and
horizontally between different functions and people at the same level
...

Accountability: the extent to which a named individual is held responsible for the success or failure
of a particular policy, project or piece of work
...
A centralised structure has a greater degree of central control, while a decentralised
structure involves a greater degree of delegated authority to the regions or to subordinates
...
g
...

Matrix organisational structure: a flexible organisational structure in which tasks are managed in a
way that cuts across traditional departmental boundaries
...

Portfolio career: a career in which income is derived from a variety of sources – perhaps a variety of
jobs or a job and a business
...
These sources include marketing consultants, call centres, and
production and assembly plants
...

Downsizing: reducing the size of a firm to make it more responsive to market conditions – e
...
by
removing ‘back room’ activities such as office functions and call centres or the production and
assembly of parts, which are then contracted out to other agencies
...

Chapter 19:
Noise: anything that can interfere with the receipt of a message, including physical problems or
aspects of attitude or culture that get in the way of the communication
...

Jargon: a word or phrase that has a technical or specialised meaning
...

Employee participation: a general term referring to the extent to which employees are involved in
the decision-making process
...
It can take the following forms: worker directors, who are elected to the board of
directors by employees from the factory floor; works councils; workers’ cooperatives, where a firm’s
workers own a majority of its shares, such as the John Lewis Partnership
...

Trade union: a pressure group that represents the interests of people at work
...

Collective bargaining: the process whereby workers’ representatives meet with employers to
discuss and negotiate employment-related issues
...

Industrial dispute: a disagreement between management and the trade union representing the
employees, which is serious enough for industrial action to result
...
g
...

Strike: a form of industrial action involving the complete withdrawal of labour by employees
...

Go-slow: a form of industrial action in which employees keep on working, but at the absolute
minimum pace required to avoid being subject to legitimate disciplinary action
...

Single-union agreement: the recognition by a firm of only one trade union for collective bargaining
purposes
...

Industrial relations: the atmosphere prevailing between an organisation’s management and its
workforce representatives i
...
the trade unions

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