Innovation and Entrepreneurship

1. Product Life Cycle (PLC) – Four stages. Introduction > Growth > Maturity > Decline

2. Six Sigma is a set of techniques and tools for process improvement. It was developed by
Motorola in 1986. Jack Welch made it central to his business strategy at General Electric in
1995. A six sigma process is one in which 99.99966% of the products manufactured are
statistically expected to be free of defects (3.4 defective parts/million).

3. Competitive Advantage: Creating and sustaining superior performance – A book by

Michael Porter

4. Quality circle – A quality circle or quality control circle is a group of workers who do the
same or similar work, who meet regularly to identify, analyze and solve work-related
problems. Quality Circle concept was first introduced in India by S. R. Udpa.

5. Fiedler contingency model – The contingency model by business and management

psychologist Fred Fiedler is a contingency theory concerned with the effectiveness of a
leader in an organisation.

6. Predatory pricing – Predatory pricing is a pricing strategy, using the method of

undercutting on a larger scale, where a dominant firm in an industry will deliberately reduce
its prices of a product or service to loss-making levels in the short-term.

7. Oligopoly – An oligopoly is a market form wherein a market or industry is dominated by a

small group of large sellers.

8. Monopoly – A monopoly exists when a specific person or enterprise is the only supplier of
a particular commodity.

9. Monopsony – In economics, a monopsony is a market structure in which a single buyer

substantially controls the market as the major purchaser of goods and services offered by
many would-be sellers.
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10. Good to Great – A management book by James C. Collins that aims to describe how
companies transition from being average companies to great companies and how companies
can fail to make the transition.

11. Appreciative inquiry – A model for analysis, decision-making and the creation of
strategic change, particularly within companies and other organizations. It was developed at
Case Western Reserve University’s department of Organizational behavior, starting with a
1987 article by David Cooperrider and Suresh Srivastva.

12. Akio Morita – A Japanese businessman and co-founder of Sony along with Masaru
Ibuka. In 1986, Morita wrote an autobiography titled Made in Japan.

13. Lateral thinking – A term coined by Edward de Bono which refers to solving problems
through an indirect and creative approach. Lateral thinking is about reasoning that is not
immediately obvious and about ideas that may not be obtainable by using only traditional
step-by-step logic.

14. Open Space Technology (OST) – An approach to purpose based leadership, including a
way for hosting meetings, conferences, corporate-style retreats, symposiums, and community
summit events, focused on a specific and important purpose or task—but beginning without
any formal agenda, beyond the overall purpose or theme.

15. 360-degree feedback – A feedback that comes from members of an employee’s

immediate work circle. The German military first began gathering feedback from multiple
sources in order to evaluate performance during World War II.

16. Blue Ocean Strategy – A book published in 2005 and written by W. Chan Kim and
Renée Mauborgne. Based on a study of 150 strategic moves spanning more than a hundred
years and thirty industries, Kim & Mauborgne argue that companies can succeed not by
battling competitors, but rather by creating “blue oceans” of uncontested market space.

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17. James C. “Jim” Collins – An American business consultant, author, and lecturer on the
subject of company sustainability and growth. His books include: Built to Last, Beyond
Entrepreneurship, Good to Great, How the Mighty Fall, Great By Choice.

18. Economic Value Added (EVA) – An estimate of a firm’s economic profit – being the
value created in excess of the required return of the company’s investors (being shareholders
and debt holders). Quite simply, EVA is the profit earned by the firm less the cost of
financing the firm’s capital.

19. Competitive Advantage – When a firm sustains profits that exceed the average for its
industry, the firm is said to possess a competitive advantage over its rivals. The goal of much
of business strategy is to achieve a sustainable competitive advantage. Michael
Porter identified two basic types of competitive advantage: Cost advantage, Differentiation
advantage.

20. The McKinsey 7S Framework – A management model developed by well-known

business consultants Robert H. Waterman, Jr. and Tom Peters (who also developed the
MBWA – “Management by Walking Around” motif, and authored In Search of Excellence)
in the 1980s. This was a strategic vision for groups, to include businesses, business units, and
teams. The 7S are structure, strategy, systems, skills, style, staff and shared values.

21. The balanced scorecard (BSC) is a strategy performance management tool that can be
used by managers to keep track of the execution of activities by the staff within their control
and to monitor the consequences arising from these actions. The original four “perspectives”
are Financial, Customer, Internal business processes, Learning and growth. The tool was
created by Robert S. Kaplan and David P. Norton.

22. The situational leadership theory – A leadership theory developed by Paul Hersey,
professor and author of the book Situational Leader, and Ken Blanchard, leadership guru and
author of The One Minute Manager, while working on the first edition of Management of

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Organizational Behaviour. The theory was first introduced as “Life Cycle Theory of
Leadership”.

23. Approaches to Global Staffing:

– Ethnocentric staffing: Primarily hiring expatriates for higher-level foreign positions.
– Polycentric staffing: More host-country nationals are used throughout the organization,
from top to bottom
– Regiocentric staffing: Regional groups of subsidiaries reflect organization’s strategy and
structure work as a unit
– Geocentric staffing: Using worldwide integrated business strategy to hire the best person
for the job

24. The managerial grid model (1964) – A situational leadership model developed by
Robert R. Blake and Jane Mouton. This model originally identified five different leadership
styles based on the concern for people and the concern for production.

25. Maslow’s hierarchy of needs – A theory in psychology proposed by Abraham Maslow

in his 1943 paper “A Theory of Human Motivation” in Psychological Review. Maslow used
the terms Physiological, Safety, Belongingness and Love, Esteem, Self-Actualization and
Self-Transcendence needs to describe the pattern that human motivations generally move
through.

26. In Search of Excellence – An international bestselling book written by Tom Peters and
Robert H. Waterman, Jr. First published in 1982, it is one of the biggest selling business
books ever.

27. A glass ceiling – A political term used to describe “the unseen, yet unbreachable barrier
that keeps minorities and women from rising to the upper rungs of the corporate ladder,
regardless of their qualifications or achievements. The term was first coined in March 1984
by Gay Bryant.

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28. Entrepreneur – A loanword from French. It is defined as an individual who organizes or

operates a business or businesses. Credit for coining the term entrepreneur generally goes to
the French economist Jean-Baptiste Say, but in fact the Irish-French economist Richard
Cantillon defined it first. Cantillon used the term differently. Biographer Anthony Breer
noted that Cantillon saw the entrepreneur as a risk-taker while Say considered the
entrepreneur a “planner”.

29. Professional Employer Organization (PEO) – A firm that provides a service under
which an employer can outsource employee management tasks, such as employee benefits,
payroll and workers’ compensation, recruiting, risk/safety management, and training and
development. This practice is known as joint employment or co-employment.

30. Kaizen – Japanese for “good change”. Kaizen refers to activities that continually improve
all functions and involve all employees from the CEO to the assembly line workers. It also
applies to processes, such as purchasing and logistics that cross organizational boundaries
into the supply chain.

31. The International Labour Organization (ILO) – A United Nations agency dealing with
labour issues, particularly international labour standards and decent work for all. ILO
Headquarters is in Geneva, Switzerland. In 1969, the organization received the Nobel Peace
Prize for improving peace among classes, pursuing justice for workers, and providing
technical assistance to other developing nations.

32. Red tape – An idiom that refers to excessive regulation or rigid conformity to formal
rules that is considered redundant or bureaucratic and hinders or prevents action or decision-
making. It is usually applied to governments, corporations, and other large organizations.

33. An open-door policy – A communication policy in which a manager, CEO, president or

supervisor leaves their office door “open” in order to encourage openness and transparency
with the employees of that company. As the term implies, employees are encouraged to stop

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by whenever they feel the need to meet and ask questions, discuss suggestions, and address
problems or concerns with management.

34. The Delphi method – A structured communication technique, originally developed as a

systematic, interactive forecasting method which relies on a panel of experts. The name
“Delphi” derives from the Oracle of Delphi. The Delphi method is based on the assumption
that group judgements are more valid than individual judgements.

35. The halo effect – A cognitive bias in which an observer’s overall impression of a person,
company, brand, or product influences the observer’s feelings and thoughts about that entity’s
character or properties. It was named by psychologist Edward Thorndike in reference to a
person being perceived as having a halo.

36. The horn effect – A form of cognitive bias that causes one’s perception of another to be
unduly influenced by a single negative trait. An example of the horn effect may be that an
observer is more likely to assume a physically unattractive person is morally inferior to an
attractive person, despite the lack of relationship between morality and physical appearance.

37. The Hawthorne effect – (also referred to as the observer effect) refers to a phenomenon
whereby workers improve or modify an aspect of their behavior in response to the fact of
change in their environment, rather than in response to the nature of the change itself. The
term was coined in 1950 by Henry A. Landsberger when analyzing earlier experiments from
1924–32 at the Hawthorne Works (a Western Electric factory outside Chicago).

38. The Value Chain – To analyze the specific activities through which firms can create a
competitive advantage, it is useful to model the firm as a chain of value-creating
activities. Michael Porter identified a set of interrelated generic activities common to a wide
range of firms. The resulting model is known as the value chain and is depicted below:
Inbound Logistics – Operations – Outbound Logistics – Marketing & Sales – Service.

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39. Management by objectives (MBO) – A process of defining objectives within an

organization so that management and employees agree to the objectives and understand what
they need to do in the organization in order to achieve them. The term “management by
objectives” was first popularized by Peter Drucker in his 1954 book The Practice of
Management.

40. A core competency – A concept in management theory introduced by, C. K. Prahalad,

Julian Kriviak and Gary Hamel. It can be defined as “a harmonised combination of multiple
resources and skills that distinguish a firm in the marketplace”. Core competencies fulfill
three criteria: Provides potential access to a wide variety of markets, Should make a
significant contribution to the perceived customer benefits of the end product, Difficult to
imitate by competitors.

41. Triple bottom line – A framework which incorporates the notion of sustainability into
business decisions, coined by John Elkington in 1994. The TBL is an accounting framework
with three dimensions: social, environmental (or ecological) and financial. The TBL
dimensions are also commonly called the three Ps: people, planet and profit and are referred
to as the “three pillars of sustainability”.

42. The Human Side of Enterprise – A book by Douglas McGregor where he identified an
approach of creating an environment within which employees are motivated via authoritative,
direction and control or integration and self-control, which he called theory X and theory Y.

43. Management by wandering around (MBWA) – It refers to a style of business

management which involves managers wandering around, in an unstructured manner, through
the workplace(s), at random, to check with employees, or equipment, about the status of
ongoing work. The origin of the term has been traced to executives at the company Hewlett-
Packard, for management practices in the 1970s. Also, the management consultants Tom
Peters and Robert H. Waterman had used the term in their 1982 book In Search of
Excellence: Lessons from America’s Best-Run Companies.

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44. Built to Last: Successful Habits of Visionary Companies – A 1994 book written by
Jim Collins and Jerry I. Porras. The text outlines the results of a six-year research project into
what makes enduring great companies.

45. Social loafing – The phenomenon of people exerting less effort to achieve a goal when
they work in a group than when they work alone. This is seen as one of the main reasons
groups are sometimes less productive than the combined performance of their members
working as individuals.

46. BCG growth-share matrix displays the various business units on a graph of the market
growth rate vs. market share relative to competitors. Resources are allocated to business units
according to where they are situated on the grid as follows: Cash Cow, Star, Question Mark,
and Dog. It was created by Bruce D. Henderson for the Boston Consulting Group in 1970 to
help corporations to analyze their business units, that is, their product lines.

47. Person–environment fit (P–E fit) – It is defined as the degree to which individual and
environmental characteristics match. Due to its important implications in the workplace,
person–environment fit has maintained a prominent position in Industrial and organizational
psychology and related fields.

48. The “carrot and stick” approach – An idiom that refers to a policy of offering a
combination of rewards and punishment to induce behavior. It is named in reference to a cart
driver dangling a carrot in front of a mule and holding a stick behind it. The mule would
move towards the carrot because it wants the reward of food, while also moving away from
the stick behind it, since it does not want the punishment of pain, thus drawing the cart.

49. H. Igor Ansoff – Ansoff was a Russian American, applied mathematician and business
manager. He is known as the father of Strategic management. Ansoff’s matrix provides four
different growth strategies: Market Penetration, Market Development, Product Development,
and Diversification.

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50. The Pygmalion effect – Also known as Rosenthal effect, it is the phenomenon whereby
the greater the expectation placed upon people, the better they perform. The effect is named
after the Greek myth of Pygmalion. Pygmalion was a sculptor who fell in love with a statue
he had carved.

51. Thinking, Fast and Slow – A best-selling 2011 book by Nobel Memorial Prize winner in
Economics Daniel Kahneman which summarizes research that he conducted over decades,
often in collaboration with Amos Tversky. The book’s central thesis is a dichotomy between
two modes of thought: “System 1” is fast, instinctive and emotional; “System 2” is slower,
more deliberative, and more logical.

52. Business process re-engineering – A business management strategy, originally

pioneered in the early 1990s, focusing on the analysis and design of workflows and business
processes within an organization. BPR aimed to help organizations fundamentally rethink
how they do their work in order to dramatically improve customer service, cut operational
costs, and become world-class competitors.

53. The Fifth Discipline: The Art and Practice of the Learning Organization – A book by
Peter Senge focusing on group problem solving using the systems thinking method in order to
convert companies into learning organizations. The five disciplines are “Personal mastery”,
“Mental models”, “Building shared vision”, “Team learning”, “Systems thinking”.

54. T. V. Rao – Also regarded as “The Father of Indian HRD”. Dr. Rao is also the founder
president of the National HRD Network and the Indian Society for Applied Behavioral
Sciences (ISABS).

55. Michael Porter – A Professor at The Institute for Strategy and Competitiveness, based at
the Harvard Business School. Michael Porter is the author of 18 books and numerous articles
including Competitive Strategy, Competitive Advantage, Competitive Advantage of Nations,
and On Competition. Professor Porter is the most cited author in business and economics.

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56. Kenneth Blanchard – American author and management expert known for his book The
One Minute Manager (co-authored with Spencer Johnson).

57. C. K. Prahalad – A professor of Corporate Strategy who was frequently ranked as one of
the most prominent business thinkers in the world. He was renowned as the co-author of
“Core Competence of the Corporation” and “The Fortune at the Bottom of the Pyramid.”

58. Departmentalization – The grouping of related functions into manageable units to

achieve the objectives of the enterprise in the most efficient and effective manner.

59. Delegation – The process that makes management possible because management is the
process of getting results accomplished through others. Delegation is the work a manager
performs to entrust others with responsibility and authority and to create accountability for
results. It is an activity of the organizing function.

60. Scalar principle – Also known as chain of command, this represents a clear definition of
authority in the organization. This authority flows down the chain of command from the top
level to the first or lowest level in the organization.

61. Centralization and Decentralization – Centralization occurs in an organization when a

limited amount of authority is delegated and Decentralization occurs when a significant
amount of authority is delegated to lower levels in the organization.

62. Peter Drucker – Austrian-born American management consultant, educator, and author,
whose writings contributed to the philosophical and practical foundations of the modern
business corporation. He was also a leader in the development of management education, he
invented the concept known as management by objectives, and he has been described as “the
founder of modern management”. As per Peter Drucker, enterprise has two–and only two–
basic functions: Marketing and Innovation.

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63. McJob (sometimes called Joe job) – A slang for a low-paying, low-prestige dead-end
job that requires few skills and offers very little chance of intra-company advancement. The
term McJob comes from the name of the fast-food restaurant McDonald’s, but is used to
describe any low-status job – regardless of the employer – where little training is required,
staff turnover is high, and workers’ activities are tightly regulated by managers.

64. Intrapreneurship – The act of behaving like an entrepreneur while working within a
large organization.

65. Need theory, also known as Three Needs Theory – It was created by psychologist
David McClelland, is a motivational model that attempts to explain how the needs for
achievement, power, and affiliation affect the actions of people from a managerial context.

66. A golden parachute – An agreement between a company and an employee (usually

upper executive) specifying that the employee will receive certain significant benefits if
employment is terminated. The benefits may include severance pay, cash bonuses, stock
options, or other benefits.

67. A golden handshake – A clause in an executive employment contract that provides the
executive with a significant severance package in the case that the executive loses his or her
job through firing, restructuring, or even scheduled retirement. This can be in the form of
cash, equity, and other benefits, and is often accompanied by an accelerated vesting of stock
options.

68. Golden handcuffs – A system of financial incentives designed to keep an employee from
leaving the company. These can include employee stock options that will not vest for several
years, but are more often contractual obligations to give back lucrative bonuses or other
compensation if the employee leaves for another company.

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69. Golden boot compensation – Also known as the ‘Golden Boot’, is an inducement, using
maximum incentives and financial benefits, for an older worker to take “voluntary” early
retirement.

70. Donald Kirkpatrick – He is best known for creating a highly influential ‘four level’
model for training course evaluation, which served as the subject of his Ph.D. dissertation in
1954. The four levels of Kirkpatrick’s evaluation model are as follows: Reaction, Learning,
Behavior, Results.

71. T-group or training group – It is a form of group training where participants learn about
themselves through their interaction with each other. They use feedback, problem solving,
and role play to gain insights into themselves, others, and groups.

72. Porter five forces analysis – A framework to analyze level of competition within an
industry and business strategy development. This analysis is associated with its principal
innovator Michael E. Porter of Harvard University. Porter’s five forces include – three
forces from ‘horizontal’ competition: the threat of substitute products or services, the threat
of established rivals, and the threat of new entrants; and two forces from ‘vertical’
competition: the bargaining power of suppliers and the bargaining power of customers.

73. Zero to One: Notes on Startups, or How to Build the Future – A 2014 book by the
American entrepreneur and investor Peter Thiel which is considered one of the best business
books. The term ‘zero to one’ is now used to indicate an act of creation of a start-up or a new
product.

74. The Johari window – A technique created in 1955 by two American psychologists,
Joseph Luft (1916–2014) and Harrington Ingham (1914–1995), used to help people better
understand their relationship with self and others. It is used primarily in self-help groups and
corporate settings as a heuristic exercise and has four areas: Open or Arena, Hidden or
Façade, Blind Spot, Unknown.

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75. Blind Ads – Recruitment advertisements that do not have the name or identity of the
Employer.

76. Participative Leadership – Participative leadership is a style of leadership in which all

members of the organization work together to make decisions. Participative leadership is also
known as democratic leadership, as everyone is encouraged to participate.

77. Competitive advantage – A competitive advantage is the attribute that allows an

organization to outperform its competitors. A competitive advantage may include access to
natural resources, such as high-grade ores or a low-cost power source, highly skilled labor,
geographic location, high entry barriers, and access to new technology.

78. Innovation – It is the process of entrepreneurship which involves the translation of a

useful idea into an application which has commercial value.

79. Collective bargaining – It is a process of negotiation between employers and a group of

employees aimed at agreements to regulate working salaries, working conditions, benefits,
and other aspects of workers’ compensation and rights for workers. The term “collective
bargaining” was first used in 1891 by Beatrice Webb, a founder of the field of industrial
relations in Britain.

80. The break-even point (BEP) – The point at which total cost and total revenue are equal,
i.e. “even”. There is no net loss or gain, and one has “broken even”, though opportunity costs
have been paid and capital has received the risk-adjusted, expected return. In short, all costs
that must be paid are paid, and there is neither profit or loss.

81. Opportunity cost – Opportunity cost is the loss or the benefit that could have been
enjoyed if the best alternative choice was chosen.

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82. Angel investor – An individual who provides capital for a business start-up, usually in
exchange for convertible debt or ownership equity. Angel investors usually give support to
start-ups at the initial moments (where risks of the start-ups failing are relatively high) and
when most investors are not prepared to back them.

83. Dumping – A kind of pricing, especially in the context of international trade. It occurs
when manufacturers export a product to another country at a price below the normal price
with an injuring effect.

84. 5 functions of management – Henri Fayol identified 5 functions of management, which

he labelled: planning, organizing, commanding, coordinating and controlling.

85. Brainstorming – Brainstorming is a group creativity technique by which efforts are made
to find a conclusion for a specific problem by gathering a list of ideas spontaneously
contributed by its members.

86. Free-trade area – A free-trade area is the region encompassing a trade bloc whose
member countries have signed a free trade agreement. Such agreements involve cooperation
between at least two countries to reduce trade barriers, import quotas and tariffs, and to
increase trade of goods and services with each other.

87. Special Economic Zone – A special economic zone is an area in which the business and
trade laws are different from the rest of the country. SEZs are located within a country’s
national borders, and their aims include increased trade balance, employment, increased
investment, job creation and effective administration.

88. Likert’s management systems – Management styles developed by Rensis Likert in the
1960s. The management systems, established by Likert, include “Exploitative Authoritative
(System I), Benevolent Authoritative (System II), Consultative (System III), and Participative
(System IV).”

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89. Planned obsolescence – A policy of planning or designing a product with an artificially

limited useful life or a purposely frail design, so that it becomes obsolete after a certain pre-
determined period of time upon which it decrementally functions or suddenly ceases to
function, or might be perceived as unfashionable.

90. TRIPS Agreement – The Agreement on Trade-Related Aspects of Intellectual Property

Rights (TRIPS) is an international legal agreement between all the member nations of the
World Trade Organization (WTO).

91. The South Asian Association for Regional Cooperation (SAARC) – Regional
intergovernmental organization and geopolitical union of states in South Asia. Its member
states are Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri
Lanka.

92. The Pac-Man defense – A defensive business strategy used to stave off a hostile
takeover, in which a company that is threatened with a hostile takeover “turns the tables” by
attempting to acquire its would-be buyer.

93. The Organisation for Economic Co-operation and Development (OECD) : An

intergovernmental economic organisation with 37 member countries, founded in 1961 to
stimulate economic progress and world trade.

94. The International Monetary Fund (IMF) – An international financial institution,

headquartered in Washington, D.C., consisting of 190 countries working to foster global
monetary cooperation, secure financial stability, facilitate international trade, promote high
employment and sustainable economic growth, and reduce poverty around the world while
periodically depending on the World Bank for its resources. It was formed in July 1944, at
the Bretton Woods Conference primarily by the ideas of Harry Dexter White and John
Maynard Keynes.

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95. Kano model – A theory for product development and customer satisfaction developed in
the 1980s by Professor Noriaki Kano, which classifies customer preferences into five
categories: Must-be Quality, One-dimensional Quality, Attractive Quality, Indifferent
Quality, and Reverse Quality.

96. Cartel – A group of independent market participants who collude with each other in
order to improve their profits and dominate the market. Cartels are usually associations in the
same sphere of business, and thus an alliance of rivals. Most jurisdictions consider it anti-
competitive behavior. Cartel behavior includes price fixing, bid rigging, and reductions in
output.

97. Tax haven – A tax haven is a country or place with very low “effective” rates of taxation
for foreign investors. In some traditional definitions, a tax haven also offers financial secrecy.

98. Too big to fail – The “too big to fail” (TBTF) theory asserts that certain corporations,
particularly financial institutions, are so large and so interconnected that their failure would
be disastrous to the greater economic system, and that they therefore must be supported by
governments when they face potential failure.

99. Disruptive innovation – In business theory, a disruptive innovation is an innovation that

creates a new market and value network and eventually disrupts an existing market and value
network, displacing established market-leading firms, products, and alliances.

100. Sweat equity – Sweat equity is a non-monetary benefit that a company’s stakeholders
give in labor and time, rather than a monetary contribution, that benefit the company. Sweat
equity is rewarded in the form of sweat equity shares. These are shares given out by a
company in exchange for labor and time rather than a monetary amount.

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101. The P-O-L-C framework – It provides useful guidance into what the ideal job of a
manager should look like. The principles of management can be distilled down to four critical
functions. These functions are planning, organizing, leading, and controlling.

102. Innovative Entrepreneur – An Individual who has the ability to undertake to create
innovative products according to the changing demands of the market.

103. Adoptive Entrepreneur – An entrepreneur who simply adopts successful innovation

introduced by other innovators. These entrepreneurs imitate the existing entrepreneurs and
setup their enterprise in the same manner.

104. Fabian Entrepreneur – An individual who does not show initiative in visualizing and
implementing new ideas and innovations wait for some development which would motivate
them to initiate unless there is an imminent threat to their very existence.

105. Drone Entrepreneur – These entrepreneurs are reluctant to change since they are very
conservative and do not want to make any changes in the organization. They are happy with
their present mode of business and do not want to change even if they are suffering the losses.

106. Small Industries Development Bank of India (SIDBI) – A development financial

institution in India, under the jurisdiction of Ministry of Finance, Government of India
headquartered at Lucknow. Its purpose is to provide refinance facilities and short-term
lending to industries, and serves as the principal financial institution in the Micro, Small and
Medium Enterprises (MSME) sector.

107. The three-sector model – It divides economies into three sectors of activity: extraction
of raw materials (primary), manufacturing (secondary), and service industries which exist to
facilitate the transport, distribution and sale of goods produced in the secondary sector
(tertiary). The model was developed by Allan Fisher, Colin Clark, and Jean Fourastié.

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108. A vision statement – It focuses on the potential inherent in the company’s future; it’s
about what they intend to be. While a vision statement might contain references to how the
company intends to make that future into a reality, the “how” is really part of a mission
statement.

109. A mission statement – A short statement of why an organization exists, what its overall
goal is, identifying the goal of its operations: what kind of product or service it provides, its
primary customers or market, and its geographical region of operation.

110. The Organization for Economic Co-operation and Development (OECD) – An

intergovernmental economic organization with 37 member countries, founded in 1961 to
stimulate economic progress and world trade. It is headquartered in Paris, France.

111. The Entrepreneurship Development Institute of India – An autonomous body and

not-for-profit institute located Ahmedabad, Gujarat, India. Established in 1983, the institute
offers master’s degree in Entrepreneurship, a fellowship program and a number of
entrepreneurship training programs.

112. Scientific Management – A theory of management that analyzes and synthesizes

workflows. Its main objective is improving economic efficiency, especially labor
productivity. It was one of the earliest attempts to apply science to the engineering of
processes to management. Scientific management is sometimes known as Taylorism after its
pioneer, Frederick Winslow Taylor.

113. Concentric Diversification – A growth strategy in which a company seeks to grow and
develop by adding new products to its existing product lines to attract new customers; also
called convergent diversification.

114. Conglomerate Diversification – A growth strategy that involves adding new products
or services that are significantly different from the organization’s present products or

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services. Conglomerate diversification occurs when the firm diversifies into an area(s) totally
unrelated to the organization current business.

115. Backward Integration – A form of vertical integration in which a company expands its
role to fulfill tasks formerly completed by businesses up the supply chain. In other words,
backward integration is when a company buys another company that supplies the products or
services needed for production.

116. Forward Integration – A business strategy that involves a form of downstream vertical
integration whereby the company owns and controls business activities that are ahead in the
value chain of its industry, this might include among others direct distribution or supply of
the company’s products.

117. Ethical codes – These are adopted by organizations to assist members in understanding
the difference between right and wrong and in applying that understanding to their decisions.
An ethical code generally implies documents at three levels: codes of business ethics, codes
of conduct for employees, and codes of professional practice.

118. 5S of good housekeeping – It involves the principle of waste elimination through

workplace organization. 5S was derived from the Japanese words seiri, seiton, seiso, seiketsu,
and shitsuke. In English, they can be roughly translated as sort, set in order, clean,
standardize, and sustain.

119. DMAIC – It refers to a data-driven improvement cycle used for improving, optimizing
and stabilizing business processes and designs. The DMAIC improvement cycle is the core
tool used to drive Six Sigma projects. However, DMAIC is not exclusive to Six Sigma and
can be used as the framework for other improvement applications. It stands for Define,
Measure, Analyze, Improve and Control.

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Innovation and Entrepreneurship

120. The All India Organization of Employers (AIOE) – An allied body of the Federation
of Indian Chambers of Commerce and Industry (FICCI), is the oldest and apex national
employers organization of India. It is the platform for Indian Employers to raise their voice in
formulating labor and social policies to promote business, trade and economy in the country.

121. Rightsizing – The process of making a company or organization a more effective size,
especially by reducing the number of people working for it is called rightsizing. Rightsizing
is a process of bringing an organization to an optimal size. The main purpose of rightsizing is
to minimize the company’s cost to optimize its profits.

122. Business Model Canvas – A strategic management template used for developing new
business models and documenting existing ones. It offers a visual chart with elements
describing a firm’s or product’s value proposition, infrastructure, customers, and finances,
assisting businesses to align their activities by illustrating potential trade-offs. The nine
“building blocks” of the business model design template that came to be called the Business
Model Canvas were initially proposed in 2005 by Alexander Osterwalder.

123. A minimum viable product (MVP) – A version of a product with just enough features
to be usable by early customers who can then provide feedback for future product
development.

124. Bootstrapping – It refers to a self-starting process that is supposed to continue without

external input. Bootstrapping in business means starting a business without external help or
working capital. Entrepreneurs in the startup development phase of their company, survive
through internal cash flow and are very cautious with their expenses.

125. Unicorn – In business, a unicorn is a privately held startup company valued at over $1
billion. The term was coined in 2013 by venture capitalist Aileen Lee, choosing the mythical
animal to represent the statistical rarity of such successful ventures.

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