BM IB1

CURRENT BUSINESS AFFAIRS

TEAM A TEAM B
1. PEHEL JAIN 1. HARSH (Leader)
2. AATHREY RUTURAJ 2. SHYEYAS
3. NEYLA BHOSLE (Leader) 3. RITHANYE KANNAN
4. RISHI 4. IRIS ELDO
5. Meera 5. YOONAH SHIN
6. Ayush 6. Diya

https://www.thehindu.club/
https://www.bbc.com/news/business/companies
SWOT analysis – Prestentation by students
Unit 1: BUSINESS ORGANISATION AND ENVIRONMENT

Chapter 1.1 Introduction to Business Management

Learning outcomes
Meaning of Business:
• It combine factors of production to produce goods and services to
satisfy needs and wants.
Q. What are main roles of a businesses?

• A) A business is a decision making organization. It combine human,

physical and financial resources to produce goods and provide
services.
• Inputs: Land, Labour, Capital and Enterprise.
Q. What are the role of a business?
A) Role of a business:
• Decision-making company or organization
• May/may not be for profit
• Involves the exchange of goods and services
• Produce goods and/or provide services
• Exist to satisfy the needs and wants of people, organizations, governments,
etc.
• Enterprise – a group of people that tackles an objective, usually profit
• Quality of output depends on quality of inputs
Q) Define the term needs and wants

• Meaning of needs: It is a good or service essential for living.

• Meaning of wants: It is a good or service which people would like to
have, but which is not essential for living. People’s wants are
unlimited.
Definitions of the terms:
• Economic problems: It results from being unlimited wants but limited
resources to produce the good and services to satisfy those wants.
This creates scarcity.
• Scarcity: It is the lack of sufficient products to fulfil the total wants of
the population. (Scarcity = unlimited wants + limited resources)
• Inflation: Rise in price.
Opportunity cost: It is the next best alternative
given up by choosing another item.
 Q. Difference between needs and wants
Needs Wants
i) It is a good or service essential for i) It is a good or service not essential
living. for living

i) Limited needs ii) unlimited wants

i) Eg: Food, water, shelter etc. iii) Eg: Car, Fridge, air conditioner
etc.
Q Explain the main inputs/ factors of production in a
business.

• Ans) Four types of inputs are:

• Capital
• Amount of money needed to run a business
• Man-made goods like machines, buildings, vehicles, and equipment needed for business to
operate
• Investment – increasing spending on capital
• Land
• Space where a business operates
• Raw materials and natural resources that are used in making a product
• Labour/manpower
• Physical & mental efforts of people to produce products/services
• Enterprise
• Management, organization, and planning of other three factors of production
• Actions of entrepreneur who shows initiative and takes risks to set up, invest, and run a
business
• Day 4 18/08/2021
Q. Describe the main business functions and their roles.

• Ans) Main business functions and their roles

• Human resources
• Manages the workforce and developing an organization’s workforce to meet the company objectives.
• Deals with recruitment, wages, communication, and motivation of employees
• Finance and accounts
• In charge of managing the organization’s money and assets.
• Ensures accurate recording and reporting of financial documentation (to comply with legal requirements)
• Marketing
• Ensure that a company’s products sell
• The management process of predicting, identifying and meeting the needs and wants of satisfying consumers’ in a
profitable manner.
• In charge of promotions, advertisements, etc.
• Operations/Production
• In charge of business functions and processes that produce the right/actual goods and services at right quantity and
quality in a cost effective and time-manner.
• Concerned with research & development, delivery, stock management, etc.
Case study activity
Brain teaser
Brain teaser – Find the hidden picture.
Q. Explain in detail the business sectors
• Business sectors (or economic sectors)
• Primary sector:
• Involves the extraction, harvesting and conversion of natural resources.
• e.g. mining, agriculture, fishing, livestock etc.
• Regulated and protected by the government
• Fuels (produces inputs for) the other economic sectors
• Example countries: Vietnam, Philippines, Canada, Dubai
• Large Percentage of output from LEDCs. Low value added.

• Secondary Sector:
• Involves construction of products or manufacturing of raw products to finished or component goods.
• Finished goods – exported or sold to domestic consumers
• Component goods – sold to companies in the tertiary sector
• Example countries: China, Scotland, Japan, Italy, USA
• Example companies: Coca-Cola, Honda, BMW
• Tertiary sector:
• Involved with service and retail
• Includes retail sales, transportation, entertainment, restaurants, media, healthcare, banking, etc.
• Exploited in developing countries
• Relies on the primary and secondary sector for inputs
• Example countries: USA, United Kingdom, Singapore, Hong Kong
• Quaternary sector:
• Involves intellectual/knowledge based activities or innovation based activities.
• Includes government, R&D, education, libraries, scientific research, information technology, etc.
Activity
Q. What is meant by sectoral change?

• A) It is a shift in relative share of national output and employment to

the business sectors.
Definition of De-industrialization
• The decline in the manufacturing or secondary sector of industry is
called de-industrialization.
Q. State the impact of sectoral change.

• A) Industrialization – primary to secondary and tertiary

• Products become more refined and have more export potential
• Increased standard of education
• Increased job opportunities in secondary & tertiary sector
• Greater focus on customer service
• Higher household income
 Q. Explain the main impact of sectoral change.

• Impact of sectoral change

• Change in economic structure (primary to secondary, secondary to tertiary,
etc.)
• Industrialization
• When a country moves towards the manufacturing sector as its principal output and
employment (primary to secondary)
• Products become more refined and have more export potential
• Raises the standard of education
• Opens better job opportunities
• Developed nation
• Exploits the tertiary sector as the national output of employment
• Further raises the standard of education
Examples of effects of shifting to the tertiary sector
• For a labor intensive manufacturer of aluminum cans
• Quality of products improve
• More distributors
• Less employees and higher wages for employees
• Can consider turning to robots and machines, as well as outsourcing
• For the owner of a small seaside bed and breakfast
• Easier to find competent employees
• More income due to higher demand
• More competition
• People would rather work for bigger companies
• Can consider expanding
• For a family-owned vegetable farm
• More demand due to more stores
• Less laborers
• Can consider opening a small business or outsource.
Case study activity
Q. Define the terms:

• Entrepreneur: Individual who plans, organizes and manages a

business, taking on financial risks in doing so. Rewarded with profit
• Intrapreneur: Being an entrepreneur but as an employee in an
organization. Rewarded with pay and remuneration.
.

Q. Differences between entrepreneurs and Intrapreneurs

Factors of production are the four types of inputs or resources necessary for the
production process

Entrepreneurs Intrapreneurs
Owners and/or operator of Employees of organization
organization Takes medium to high risks
Takes substantial risks Innovative
Visionary Rewarded with pay and remuneration
Rewarded with profit Accountability to the owner / operator
Responsibility for workforce (labour) Failure is absorbed by the organization
Failure incurs personal costs  
Brain teaser
Brain teaser
Q.Identify the reasons for starting up a business or an enterprise.

• Reasons for starting up a business or an enterprise

• Profit – positive difference between revenues and costs
• Fame, Growth, earnings, challenge, autonomy, security, hobbies
• Benefit human welfare
• Very fulfilling
• Family
• Legacy
Q. What are the common steps in starting up a business and
problems new ones may face?

• Businesses often start up by looking for market opportunities (market gaps or

niches)
• Niche markets are where small businesses can easily compete
• Factors to consider: What questions would businessmen ask about the
factors?
• Business idea/Plan
• 4 business inputs (capital, land, labor, and enterprise)
• Four departments/functional areas
 Case study activity
• Farah branches out on her own Farah was a well-qualified dressmaker. She had worked
for two of the biggest dress shops in town. She was always arguing with her shop
manager, who was very jealous about Farah’s superior dress making skills. Farah was
now determined to set up her own business. She was lucky that her father was
prepared to invest $5,000 in it, but she would have to find the rest of the capital
needed – about $10,000, she guessed – from her own savings and a bank loan. Her first
step was to investigate the prices of shop premises and she was disappointed when
she found out how expensive the city-centre locations were. Her father suggested a
cheaper but less busy out-of-town location. She contacted an accountant who offered
to look after the financial side of the business, but he would charge at least $2,000 per
year. Farah wondered if she could learn to keep the accounts herself if she attended
classes at the local college in the evening.
• She wanted to make her shop very different from all of the competitors in the city
and she had the idea of offering lessons in dress-making as well as selling finished
dresses. She had been asked so many times by customers, ‘How did you do that?’
when they were pleased with her latest dress designs, that she was sure this was
a great business opportunity. What she had not realized was the amount of
paperwork she had to complete before her business could even start trading.

• 1 Outline three problems that Farah had to deal with in setting up this new
business. [6]
• 2 Which of these problems do you think was the most important one for Farah to
find a good solution to? Explain your answer. [6]
• 3 Do you think Farah had some of the right qualities to be a successful
entrepreneur? Justify your answer. [10]
 Theory of knowledge
• Look at the reasons for starting up a business.
How do reason and emotion interact to affect the decision making
process? Is emotion or reason more important in this process?
Brain teaser
Q. Write the problems that a new business or enterprise may face.
• 1. Lack of finance, cash flow problems
• 2. Lack of manpower.
• 3. Legalities are complex in some countries
• 4. High production costs
• 5. External issues in economy – oil crisis, disaster, limited resources.
• Possible problems faced by a start-up (either internal or external)
• Internal
• No land to establish a business
• Product may not appeal to your location
• Lack of manpower
• External
• Terrorists
• Politics or government
• National Calamities
• Limited resources
Q. Write in short the elements of a business plan?

• Information about business.

• Information about the product.
• Information about the market
• Information about the finance.
• Information about personnel.
• Information about marketing – the market research & test marketing.
 Elements of a business plan
• Business plan
• Report detailing aims and objectives of a business
• Planning tool that serves as a blueprint to address the issues of a startup business
• Meant for investors/banks to help them decide on whether to invest/approve
loans
• Elements of a business plan
• Business – name of the business, type of the business, statement of aims and objectives,
details of the owner
• Product – details of goods/services, operations and equipment needed, suppliers, price
• Market – who you’re selling to, market profile, competition (strengths and weaknesses)
• Finance – money, start-up costs
• Personnel – employees and workforce, skills
• Marketing – marketing mix employed by business
Web links and video links
Website links:

https://ibnotesbyellie.weebly.com/introduction-to-business-management.html
https://
sites.google.com/site/brackensibbusiness/units/business-organizations-and-environment/1-1-nature-of-business-activity
https://sites.google.com/a/aisr.org/mun-ib/Business-SL/business-organization/topic-1-1-introduction-to-business-manag
ement
 
https://www.businessmadeeasy.xyz/business-basics/1-1-introduction-to-business-management/
https://blog.prepscholar.com/the-best-ib-business-and-management-notes-study-guide
 https://www.mrbevan.com/11-introduction-to-business-management.html
 
Video links:
https://www.youtube.com/watch?v=BlbJ-tyOQV0
https://slideplayer.com/slide/12097380/
https://www.youtube.com/watch?v=7qhMg19y_OI
Power point presentation – By students
• SWOT analysis
TEAM A TEAM B
1. PEHEL JAIN 1. HARSH (Leader)
2. AATHREY RUTURAJ 2. SHYEYAS
3. KARAN SANTOSH 3. RITHANYE KANNAN
4. NEYLA BHOSLE (Leader) 4. IRIS ELDO
5. RISHI 5. YOONAH SHIN
BM – Assessment pattern
• Thank you