Essay on Business! Read this essay to learn about:- 1. Short Essay on Business 2. Characteristics of Business 3. Classification 4. Role of Profit 5. Changing Concept 6. Objectives 7. Processes 8. Techniques of Finding New Business Ideas 9. Need for Ethical Considerations 10. Social Responsibility 11. Changing Environment.
Essay on Business
ADVERTISEMENTS:
Essay Contents:
- Short Essay on Business
- Essay on the Characteristics of Business
- Essay on the Classification of Business
- Essay on the Role of Profit in Business
- Essay on the Changing Concept of Business
- Essay on the Objectives of Business
- Essay on Business Processes
- Essay on the Techniques of Finding New Business Ideas
- Essay on the Need for Ethical Considerations in Business Enterprise
- Essay on the Social Responsibility of Business
- Essay on the Changing Environment of Business
1. Short Essay on Business:
Business represents an organised effort by an individual or group of individuals engaged in making a living. It, therefore, includes all those activities which involve production or purchase of goods or rendering of certain services with the object of selling them at a profit. It is expected of business to provide goods and services to the society in an effective manner.
That is, while it should aim at earning profit, it should also keep in view the interest of its customers who should feel satisfied after they have purchased goods or services from it. Only then, a business can survive and flourish.
Though the term ‘business’ has been defined by different authors in their own ways, there is not much difference in the essence of their definitions.
ADVERTISEMENTS:
For example- according to Urwick and Hunt, “Business is any enterprise which makes, distributes, or provides any article or service which other members of the community need and are able and willing to pay for.”
Almost the same views have been expressed by Davis when he defines business as “the organised effort by individuals to produce goods and services, to sell these goods and services in market place, and to reap some reward for this effort.”
Thus, business, on the one hand, aims at earning profit for itself and, on the other, it provides required goods and services to the members of the society at a price that they can afford. Therefore, Davis and Blomstorm are very right when they say, “Business comprises all profit-seeking activities and enterprises that provide goods and services necessary to an economic system.” Thus, while profits are a primary mechanism for motivating business activities, meeting needs of the people is one of the main objectives of business.
Business is the economic pulse of a nation, striving to improve the society’s standard of living. Thus, business means the total enterprise of a country in manufacturing, industry, finance and commerce. It may be public enterprise or a private enterprise or the like.
ADVERTISEMENTS:
2. Essay on Business: Characteristics of Business:
For any activity to be called business, it must possess the features as given below:
1. Economic Activity:
Business is solely an economic activity as it involves buying and selling of goods and services for the purpose of profit-making and creating wealth. Non-economic activities such as serving the poor, cooking for one’s family and attending religious gatherings are not called business because they are not performed with the objective of earning wealth.
2. Dealings in Goods and Services:
A crucial aspect of business is production or purchase of goods and services for selling them to earn profit by satisfying human wants. The goods and services are of two types – Consumer goods which are meant for direct consumption by the ultimate consumer like coffee, soap, biscuits, shampoo etc. and Producer goods which are utilised in the production of consumer or capital goods such as machinery, raw materials, and industrial chemicals.
ADVERTISEMENTS:
Services can be classified as intangible goods such as transportation, banking, insurance, warehousing, communication etc. Services clear the way for buying and selling of goods by removing various hurdles in business.
3. Continuity in Dealings:
The sale and exchange of goods and services become a business activity only if there is regularity of dealings. A single or isolated transaction cannot be called business. For example, if Caryn gives her old books to poor school- going children, it won’t be called a business activity. However, if Caryn sets-up a shop to sell old books in exchange of money, it becomes business.
4. Profit Motive:
Profit earning is the main aim of business. It lends continuity to business. Profits ensure the growth and survival of business in the long-run. However, profit should not be earned through unlawful, unethical and unfair means.
5. Sale, Transfer or Exchange:
A business cannot function without sale, transfer or exchange of commodities or services for some monetary consideration. In business, goods and services are delivered to those who need them and are ready to pay for them. For instance, if the owner of a toy shop, Mr. X, gifts a toy to his son, it is not business. But, if he sells the toys to a customer at his shop, in exchange of money, it can be called as business.
6. Creation of Utilities:
ADVERTISEMENTS:
Utility means the value or usefulness received by a purchaser in return for exchanging money for the producer’s goods or services. Business makes goods more useful for others by adding time, place, form and possession utilities to them. It transports goods where they are available in excess to the place of scarcity (place utility). It also makes goods available for usage in future by storing them in warehouses (time utility). Thus, everyone is able to satisfy wants and needs in an efficient and economical manner.
7. Element of Risk:
Risk in the context of business is used to denote the uncertainty of making profit or possibility of suffering loss. Risk is an inseparable part of business. However, the reward is a positive outcome of bearing risk. Change in demand, changes in fashion or consumer taste, competition, government policies, economic recession etc. are the main causes behind creation of business risk.
Losses are also incurred by business due to natural calamities such as earthquake, tsunami, floods, strike by employees, theft, fire, inappropriate usage of company funds etc. Though various types of business risks can be avoided by correct forecasting and insurance but it is not possible to completely eliminate all risks.
8. Art As Well As Science:
Business is an art because it involves application of creative skills, ideas and experiences to achieve the desired goals. It is also a science because it is based on certain laws and principles.
ADVERTISEMENTS:
3. Essay on Business: Classification:
We may classify business activities into two categories. In the first category we can group all the business activities relating to production. Similarly, all the activities relating to exchange may be grouped under the second category. The first category is known as ‘Industry’, while the second category is called as ‘Commerce’.
(i) Industry:
Industry refers to that part of business activities which is concerned with the production of want-satisfying goods through utilisation of available material resources. Industry utilises the natural resources and brings them into the form useful for final consumption or further use.
It means that industrial activity aims at ensuring the supply of goods in that form which suits the objects, needs and convenience of the persons expected to use them. Thus, industry creates the form utility to goods.
ADVERTISEMENTS:
There is another explanation for industry:
Under this explanation, industry means a group of factories usually specialising in a particular product line. For example, all the factories which produce cloth are collectively called the textile industry.
The three main sectors of the industry are:
a. Primary Sector- extraction of raw materials – mining, fishing and agriculture.
b. Secondary/Manufacturing Sector- concerned with producing finished goods, e.g., factories making toys, cars, food, and clothes.
ADVERTISEMENTS:
c. Service/’Tertiary’ Sector- concerned with offering intangible goods and services to consumers. This includes retail, tourism, banking, entertainment and I.T. services.
A primitive economy will primarily be based on the primary sector – with most people employed in agriculture and the production of food.
As an economy develops, improved technology enables less labour to be needed in the primary sector and allows more workers to produce/manufacture goods. Further development enables the growth of the service sector and leisure activities.
The primary sector is sometimes known as the extraction sector – because it involves taking raw materials. These can be renewable resources, such as fish, wool and wind power or non-renewable resources, such as oil extraction, mining for coal.
In the 1920s, over one million people were employed in the UK coal industry. It was a key part of the economy. However, improved technology and the growth of other energy sources have seen a dramatic decline in this primary sector industry.
ADVERTISEMENTS:
b. Secondary or Manufacturing Industry:
The manufacturing industry takes raw materials and combines them to produce a higher value added finished products. For example, raw sheep wool can be spun to form a better quality wool. This wool can be threaded and knitted to produce a jumper that can be worn.
Initially the manufacturing industry was based on labour intensive ‘cottage industry’ e.g., hand spinning. However, the development of improved technology, such as spinning machines, enabled the growth of larger factories. Benefiting from economies of scale, they were able to reduce the cost of production and increase labour productivity. The higher labour productivity also enabled higher wages and more income to spend on goods and services.
The service sector is concerned with the intangible aspect of offering services to consumers and business. It involves retailing of the manufactured goods. It also provides services, such as insurance and banking. In the twentieth century, the service sector has grown due to improved labour productivity and higher disposable income. More disposable income enables more spending on ‘luxury’ service items, such as tourism and restaurants.
(ii) Commerce:
In simpler terms commerce can be defined as all functions connected with the buying and selling of goods and services. In other words, commerce deals with the movement of goods from the men who produce them (the producers or the manufactures) to the men who ultimately consume them (the ultimate consumers).
ADVERTISEMENTS:
It is the function of commerce to provide the connecting link between producers and consumers. Therefore, such commercial activities connected with production, distribution and consumption etc., are called commercial activities.
4. Essay on Business: Role of Profit in Business:
Earning money is the primary motivator for any economic activity including business. A business should earn sufficient profit so as to cover its expenses and accumulate enough funds for its expansion and growth.
The following features highlight the role of profit in business:
1. Survival:
ADVERTISEMENTS:
The main objective of a business enterprise is to gather enough funds for its survival in the market and to thrive in the long-run. In case the organisation falls short of enough profits, it will be forced to consume its capital, and eventually shut shop. Profits are helpful in surviving trade cycles and other unforeseen events. They are also required in maintaining factors of production like labour, land and machinery.
2. Expansion and Growth:
Profits are essential for expansion and growth of the business enterprise. They are a great source of self-financing. As business is dynamic in nature, it needs to bring changes in its business strategies. All this is possible only when a business earns sufficient profits.
3. Measuring of Efficiency:
The success of a business is measured in terms of the profit it makes. The higher the profits, the more efficient a business is. Thus, it is the parameter on which success of a business is measured.
4. Reward for Risk:
ADVERTISEMENTS:
Business risk means the possibility of reaping lower profits or losses due to change in government policies, changing tastes of consumer etc. Every businessperson bears risks while carrying out business activities. Profit is the reward an entrepreneur gets for bearing the risks in running a business. Without reaping profits, no businessperson would be motivated to take risk.
5. Reputation and Goodwill:
A profitable business enterprise enjoys more goodwill as compared to the one incurring losses. It attracts resourceful staff and investors who are willing to pool in their capital. Moreover, a profit-making company can easily avail loans from banks and obtain credit for further expansion.
Objections against Profit Maximisation:
Profit-making is the main driver and an indispensable part and parcel of a business enterprise. However, it should not be the only pursuit of a business.
The profit maximization suffers with the following objections or drawbacks:
1. Indulgence in Malpractices:
Businesspersons aiming to maximize profit tend to resort to socially unfair means like overpricing, black-marketing, hoarding, adulteration etc. They may get obsessed with profit-making and consider it the ideal aspect of business.
2. Results in Exploitation:
Overambitious businesspersons aiming to earn more profits may exploit their employees by offering less pay and no hike in the remuneration. They may even make the employees work for long hours to derive maximum benefit for profit-maximisation. In addition, business enterprises longing for more profits may exploit natural resources such as trees, water bodies, mineral deposits etc.
For example- in 2015, many top Realtors in the National Capital Region (NCR) were found to be illegally extracting ground water for construction purposes. Some famous industrial giants were also booked for flouting the norms by extracting ground water for packaging mineral water bottles to be sold in the market.
3. Profit-Making At the Cost of Business:
The ambition to earn more and more profit may blind the businesspersons to such an extent that they may even put the welfare of business at stake. They may spend less money on Research and Development (R&D), employee training, procure cheap raw materials and ignore long-terms investments for the business firm. These actions are bound to have detrimental consequences on the enterprise sooner or later. Consequently, it may have adverse impact on the economic growth of the country.
4. Lack of Interest in Social Responsibility:
Business being a social institution has obligations towards the society. In the words of Howard R. Bowen, “social responsibility refers to the obligations (of businessmen) to pursue those policies, to make those decisions or to follow those lines of action which are desirable in terms of the objectives and values of our society.” Over-emphasis on profit-making may derail the businesspersons from taking a balanced approach of doing business. They may overlook their social responsibilities in order to fulfill their ambitions for business growth.
Therefore, it is in the long-term interest of the business to follow the idea of profit- making through honest means to serve all the stakeholders such as the founders, shareholders, investors, consumers, government and the society.
5. Essay on Business: Changing Concept of Business:
Business and society are closely inter-related with each other and therefore, there is a great interaction between the two. Business influences the various elements of the society which, in turn, affect business. Although business activities also affect social outlook, values, attitudes, customs, way of thinking, etc.
Yet it the reason that there has been a change in the concept and objectives of business as follows:
1. ‘Profit’ Concept of Business (Old Concept of Business):
Initially business was considered to be a commercial activity aiming at making of profits or organisations formed to make a profit. Profit maximisation was considered to be the basic objective of every organisation. It conforms to the views of Frankin G. Morse when he says, “We are in business not for steel making, not for shipbuilding, not for construction of buildings but for earning profit.” Profit was considered to be the sole objective of business.
2. ‘Profit-cum-Service’ Concept/Modem Concept/ ‘Business as a Social System’ Concept:
Till around 1950 or so, business was concerned with two main features was replaced by ‘Profit-cum-Service’ concept which stated that the aim of business is to make a better product at a competitive price. The result should be customer satisfaction and profit to shareholders.
3. ‘Profit-through-Service ‘Concept/Modern Concept/’/Business as a Social System ‘Concept:
Till around 1950 or so, business was concerned with two basic objectives, viz:
(i) Provision of goods and services to satisfy customer needs and desires, and
(ii) Securing of profits for the owners of business. But since 1950, people have questioned whether customer need satisfaction and economic profit are the only corporate objectives. Today, there are many organisations which take ‘profit-making’ as a secondary objective. Not only this, there are some organisations, especially in the public sector, and government undertakings whose main consideration is to serve the community even if they have to run at a loss.
The modern outlook is that business should not serve the interest of businessmen and customers alone but also maximise the interest of the nation and its economy. Modern view indicates that the present society has many groups and all of them have a stake or interest in business enterprise. Therefore, the business should take care of all these sections of the society. Instead of behaving like a ‘BigBrother’ business should serve the society.
Due to the above thinking, today business is regarded as an integral part of the social system. A ‘System’ conveys the idea that everything is inter-related and inter-dependent. A system is usually dependent on the orderly functioning of other sub-systems for its harmonious and continuous action. A system becomes ‘social system’ when it relates to people.
It normally aims at seeking certain human objectives like running a business for providing goods or services to the society and for earning profit. In this sense, business is also a social system having production, finance, personnel, marketing, etc., as its sub-systems. Each of those subsystems, in turn, is composed of further sub-systems.
An organisation can function effectively only when each of its subsystems operate in a coordinated, balanced and integrated manner. Today, it is well recognised that the direction of business is important to the public welfare, that businessmen perform a social function. “According to Davis and Blomstorm also, business is “a social institution, performing a social mission” and having a broad influence on the way people live and work together.”
The main characteristics of business as a social system are as follows:
1. Business is a system having its own sub-systems:
Every system is a part of larger system, which again is a part of an even larger system, and so on, until all related parts have been joined in terms of the largest known system. In this way, something is a ‘whole system’ from one point of view but a ‘sub-system’ from a larger point of view. Thus, business is a ‘whole system’ having production, marketing, finance, personnel, etc., as its sub-systems each of whom has its own function and simultaneously is inter-related with and inter-dependent on one another to make business a ‘whole system’.
2. Business interacts with its external environment:
No business can run in isolation. It has to interact with other business organisations and social groups. All business organisation are open systems and, therefore, inter-connected with other social groups existing in their external environment.
3. Business is a dynamic social system having stabilising tendencies:
Every social system is related to people who are living, active and dynamic creatures. There is always an element of change and uncertainty in their actions. Therefore, every social system has to be dynamic to face challenges posed by varying human behaviour. Despite the inconsistencies both in the internal and external environment, a business organisation has to maintain equilibrium by coordinating both the internal and external forces just as an ocean remains quiet despite stormy waves, moving sea-life, merging rivers, etc.—all of which operate in a balanced manner.
4. Social Values:
Like other social systems, business also develops certain values which are derived from various sources like the mission of the business as a social institution, the country in which the business is conducted, the nature of employees, the philosophy of the management, etc. Such social values serve as a guide for employees’ decisions in the interests of business and also act as potential motivators for people in a business.
5. Viability:
According to Davis and Blomstorm, viability implies the “drive to live and grow,” to “accomplish a problem potential objective not yet reached” and to “achieve all that a living system is capable of becoming.” Every business needs a drive and spirit of its own to make it a positive actor on the societal stage rather than a reactor or a reflector. It must contribute its share of forces to its environment rather than merely adjust itself to outside forces.
6. Public Visibility:
It involves the extent to which an organisation’s activities are known to outside public. Acts can be judged only if they are known. Therefore, the significance of public visibility is that it subjects business activities to public examination, discussion and judgment. For example, if we find that poisonous gases are being released by a particular factory, only then we can criticise or react to it.
7. Business is related to people:
Another important feature of business is that it is related to people. It has been rightly observed that business is by the people and for the people.
Thus, we see that business is related to people and it being an open system interacts with different components of its external environment including the society and, therefore, affects the society and, in turn is affected by the society.
6. Essay on Business: Objectives of Business:
Objectives give purpose and direction to the work of all employees. They indicate the broad limits within which action is to be taken. They serve as media by which multiple interests are channeled into joint effort. Therefore, identification of objectives of business is a must if it is to be managed well. Objectives contribute to management process and they influence the size and charter of organisation, its policies, personnel interests, type of leadership find managerial control. They are the very basis of management philosophy.
Different authors have classified business objectives in different way.
However, for convenience sake, we classify the business objectives as follows:
1. Primary Objectives:
i. Survival and Growth of Business and Profit to Shareholders:
Every enterprise wants not only just to stay in business but also to grow and prosper. It looks forward to extension, development and improvement of its efficiency. For all this, it has to take risks. Hence, it is essential to provide for risks which are possible only through aiming at profits.
Therefore, profitability is the basic economic objective for the survival and growth of an enterprise.
Earning profit as one of the objectives of business can be justified because profit is necessary:
(i) To pay fair return to shareholders for their investment,
(ii) To retain some earnings for re-investment which is necessary for its growth, and
(iii) Profit is the index of efficiency of an enterprise.
ii. Service to Customers:
One of the primary objectives of an organisation is to supply economic goods and services of good quality, in adequate quantity and at reasonable prices. If an enterprise has to survive and flourish, it will have to ensure consumer satisfaction to the highest degree possible.
2. Social Objectives:
i. Employees’ Satisfaction:
Each employee strives for the accomplishment of certain individual goals like good pay, promotion, participation in management, sharing of profits, recognition of his personality, etc. The organisation can expect willing and effective cooperation from its employees only when it takes care of goals of its employees. Thus, goals of individuals should become organisational goals. There should be a perfect integration between these two types of goals.
ii. Service to Community and to Society in General:
Today, a business organisation is considered not only as an economic institution but also as a social institution and a living organ of the society. As it has to perform both the economic and a social function, it is responsible for economic result and also for social contribution. Today business is supposed to take care of different sections of the society. It has to bother for public opinion also.
Therefore the main objectives of a business enterprise under the present head can be:
1. Maintenance of regular and adequate supply of goods and services of good quality at reasonable prices.
2. Customer-oriented marketing approach.
3. Assisting in the development and promotion of amenities in the locality, e.g., medical facilities, educational facilities, etc.
4. Protecting environment front pollution.
5. Contribution to the well-being and uplift of the community or society at large.
6. Donations for public welfare projects.
7. To contribute to national goals.
Social objectives can enable the organisation to build up its public image and promote its goodwill.
iii. Observance of Governmental Regulations:
A business organisation is supposed to observe all rules and regulations framed by the government. For example- in India there are a large number of Acts, passed by the government, for their implementation by the business organisation. It should pay all dues, taxes and duties, etc., to the local, state and central government whenever due.
iv. Ethical Behaviour:
A business enterprise should be bound by certain ethical (moral) principles. It should have certain rules of conduct which should reflect its responsibility and dignity. It should conduct itself in a way which should not be detrimental to the interests of the society or the organisation itself.
Thus, the main objectives of a socially responsible business should be to strengthen itself and simultaneously take due care of different sections of the society who have any stake whatsoever in business.
7. Essay on Business Processes:
A lot of operational problems and errors arise in businesses because of the haphazard and non-uniform manner in which various operations are carried out. To solve such a problem, a Standard Operating Process (SOP) document or Operations Manual must be prepared to list down all the steps involved in every process.
E.g. how the company processes a sales order. If the entire sales process is not designed and communicated properly to all involved in the process, there are chances that different people in the team may follow different steps in executing a sales order. This may result into confusion, errors, delays and bad experience for the customers.
The development of the Operations Manual which covers all processes within a company can be approached by examining the department KRAs of the company. Generally, there should be a Standard Operating Process for each department KRA. It may be quite elaborate or just a few steps. Preparing SOP for each department KRA may lead to the creation of the Operations Manual of the company.
Here are some questions for some common business processes. These questions are only indicative and are presented here to give a direction towards setting up the process. Answering these and similar additional questions which may be applicable to your business will lead to the documentation of the process in question.
1. Sales Process:
How will a customer give an order?
Which details must be included in the order received?
Who will receive and check the order received?
What are the criteria for checking the order? (Product names/codes, quantity, rate, delivery date, dispatch preferences etc.)
Who will authorize the dispatch against the order?
What are the criteria for such authorization?
Is there any credit limit check done before the order is processed? How and by whom?
Where will the order be recorded?
How will the material be prepared and packed? Who will inform whom and how?
How will the delivery challan/bill/invoice be made? When and who will make it?
How will the material be dispatched?
How the customer will be intimated about the status of the order (Dispatched/partly-dispatched/delayed). Who will inform and how?
How the payment will be received?
2. Purchase Process:
Who will start the purchase process by raising a requisition or an indent?
Which details will be required on the requisition?
Who will check and authorize the requisition?
Who will prepare, send and keep track of the Purchase Orders?
How will suppliers be paneled for regular purchases?
How will a supplier be chosen for a particular purchase, if it is not a regular purchase?
In which cases a quotation/pro-forma invoice must be received? How many?
Who will receive and check the material purchased?
How will the discrepancies in quantity, quality, rates etc. be resolved?
Which documents will go back to the sender?
Which documents will be given to our accounts department for payment processing?
3. Payment Process:
How will the accounts department keep track of payables?
What will be the authorization required for various types of payments?
How and when will the discrepancies, without resolving which the payment cannot be released, be resolved?
With respect to due date, when will we make the payment?
How many different payment modes will we use to make supplier payments? (E.g. Cash, Cheque, Demand Draft, Bank Transfer, Credit Card etc.)
4. Inventory Management Process:
How will the various items in our store be classified?
How will they be named?
Will there be any codes assigned to them?
Where and how will they be stored?
How will the incoming and outgoing items be recorded?
How will the minimum stock levels and minimum reorder levels of various items be determined?
How frequently the purchase indent will be raised?
How frequently stock reviews will happen?
When will physical stock verification be done?
What will be the method to resolve the discrepancies between physical stock and recorded stock?
5. Sales Return Process:
How can the customers return the material sold to them? Which procedure do they need to follow?
What will be the terms and conditions for accepting these sales returns? (E.g. Days of sale, condition of goods, shipping charges etc.)
Who will authorize or approve the sales return?
Who will record the sales return transaction?
Which documents or entries will be generated?
Who will be intimated about the sales return (e.g. representatives from accounts, stores, sales etc. departments)
Who will verify the goods received back?
Who will finalize the rates of these goods received back?
6. Purchase Return Process:
How can we return the material to the suppliers? Which procedure should be followed?
Who will initiate or authorize/approve such a purchase return?
Who will record the purchase return transaction?
Which documents or entries will be generated?
Who will be intimated about the purchase return (e.g. representatives from accounts, stores, purchase etc. departments)
Who will verify the goods being sent back?
Who will coordinate with the supplier and confirm the receipt of sent goods at the supplier’s end?
How will the credit amount for the returned goods be recovered?
7. Salary Calculation and Disbursement Process:
When will the calculation of salary of the month begin?
Which departments will be involved in the process?
Till which date of leaves will it consider? (Sometimes, leave data up to 25th of the current month is considered and the leaves from 26th onwards are considered in the next month calculation. This is done to facilitate timely calculation for disbursement of salary on the first day of the next month).
How will the advance taken by the employee and his loan repayment installment be considered in the calculation?
Who will prepare the calculation?
Who will check and approve it?
How will the salary be disbursed? (Cash, cheque, bank transfer etc.)
How will the employee’s acknowledgment be taken?
Who will attend to and resolve the employee queries post disbursement?
Remember, the above list is primary and given only for demonstrative purpose to give an idea about process development. It must be developed as per your company’s operations. In real practice, each of these processes may be divided into smaller processes, e.g.
A sales process may be divided into order, shipping/dispatch and collection processes.
A purchase process may be divided into purchase requisition, ordering and material receiving processes.
8. Essay on Business: Techniques of Finding New Business Ideas:
Business ideas are all within everyone and within the environment. Some of these business ideas emanate from analysis of market and consumer needs, while others emanate from a long research process. But the truth still remains that business opportunities are abound. Following are sources of small business ideas and opportunities.
(i) Look within and Examine Skills, Talent and Passion:
In fact, one of the first places to start when looking for business ideas or opportunities is to look within. Most people miss this greatest source of business ideas because of ignorance, laziness and self-doubts.
(ii) Keep up with Current Events and Take Advantage of Business Opportunities:
Societal happenings, events and trends are also sources of business ideas. If one reads and watches news regularly and having the conscious intent of discovering business ideas, there are many business opportunities that will generate.
(iii) Invent a New Product or Service:
With a creative mind one can invent product or services that have never existed in the past. To develop a creative mind, one needs a mindset or perception that sees beyond problems. To develop winning ideas, there is a need to concentrate on a specific target market and analyze and brainstorm business ideas for services that the group would be interested in.
(iv) Add Value to an Already Existing Product:
The uniqueness between raw wood and finished lumber is a nice instance of putting a product through an additional process which maximizes its value, but additional processes are not the only way that value can be added. For this one has to look beyond the lines.
Ask following questions:
a. What are those products you use, that could be improved upon?
b. Which industry things are poorly done?
If answers to such questions are found, a profitable business can be easily created.
(v) Franchising:
A franchise is just an arrangement whereby the’ manufacturer or the sole distributor of a trademark, product or service grants exclusive rights for local distribution to independent retailers in return for their payment of conformity and royalties in order to standardize operating procedures.
Franchising can become a source of business opportunities. Good companies or products that exist in other countries but are not operating in the home country, can purchase a franchise to that product and become a pioneer in home country.
(vi) Mass Media:
The mass media is a wonderful source of information, ideas and often opportunities. Magazines, TV stations, Cable networks, radio, newspapers and internet resource sites are all instances of mass media.
(vii) Exhibitions, Expos and Trade Shows:
Another means to discover business ideas and opportunities is to attend exhibitions and trade fairs. These are usually advertised on the radio or in newspapers. By visiting such events regularly, you will not only find out new products and services, but you will, as well, meet sales representatives, wholesalers, distributors, manufacturers and franchisers. These are always excellent sources of ideas in business.
(viii) Industrial Surveys:
The main point for a new business idea should be the customer. The needs and wants of the customer, which will provide the rational for a product or service, can be analyzed or ascertained through a survey. Such a survey may be conducted formally or informally by speaking to people; usually through interviews or using a questionnaire or through observation.
(ix) Listen to Customers Complaints:
Complaints and frustrations on the part of customers have led to many new products or services. Whenever consumers complain badly or bitterly concerning a product or service then, there is a potential for a business idea. The idea can be to set up a rival company offering a better product or service, or it may be a new product or service which can be sold to the company in question or to others.
(x) Brainstorming:
Brainstorming is a creative problem-solving technique, and also a source for generating ideas. The object is to arrive with as many ideas as possible. It usually begins with a question or problem statement. Each idea can lead to one or more additional ideas, resulting in a good number of ideas. In short, this process involves engendering a huge number of solutions for a specific problem/idea with emphasis being on the number of ideas.
(xi) SCAMPER:
It is an idea generation technique that utilizes action verbs as stimuli. It is a well-known kind of checklist developed by Bob Eberie that assists the person in coming up with ideas either for modifications, that can be made on an existing product or for making a new product. SCAMPER is an acronym with each letter standing for an action verb which in turn stands for a prompt for creative ideas.
(xi) Mindmapping:
Mindmapping is a graphical technique for imagining connections between various pieces of information or ideas. Each fact or idea is written down and then connected by curves or lines to its minor or major fact or idea, thus building a web of relationships. It was developed by Tony Buzan, a UK researcher which he discussed in his book ‘Use your Head’ (1972). Mind mapping is utilized in brainstorming, project planning, problem solving and note taking to enable sharing of concepts and ideas.
(xii) Synectics:
Synectics is a creative idea generation and problem solving technique that arouses thought processes that the subject may not be aware of. It is a manner of approaching problem-solving and creativity in a rational manner. It was developed by William J.J. Gordon and George M. Prince.
(xiii) Storyboarding:
Storyboarding has to do with developing a visual story to explain or explore. Storyboards can help creative people represent information they gained during research. Pictures, quotes from the user, and other pertinent information are fixed on cork board, or any comparable surface, to stand for a scenario and to assist with comprehending the relationships between various ideas.
(xiv) Role Playing:
In the role playing technique, each participant can take on a personality or role different from his own. As the technique is fun, it can help people reduce their inhibitions and come out with unexpected ideas.
(xv) Attribute Listing:
Attribute listing is an analytical approach to recognize new forms of a system or product by identifying/recognizing areas of improvement. To figure out how to enhance a particular product, it is broken into parts, physical features of each component are noted, and all functions of each component are explained and studied to see whether any change or recombination would damage or improve the product.
(xvi) Visualization:
Visualization is thinking of challenges visually so as to better comprehend the issue. It is a process of incubation and illumination where the participant takes a break from the problem at hand and concentrates on something wholly different while his mind subconsciously continues to work on the idea.
This grows into a phase of illumination where the participant suddenly gets a diversity of solutions and he /she rapidly writes them down, thereby creating fresh parallel lines of thought.
(xvii) Morphological Analysis:
Morphological analysis aims at recognizing the structural aspects of a problem and studying the relationships among them. It involves imagining the proposed problem and also imagine the probable solution. In doing so, many times, a novel idea occurs and the solution is found.
(xviii) Forced Relationships:
It is an easy technique involving the joining of totally different ideas to come up with a fresh idea. Though the solution may not be strictly unique, it frequently results in an assortment of combinations that are often useful. A lot of products we see today are the output of forced relationships such as a digital watch that also has a calculator, musical birthday cards etc.
Most of these ideas may not be revolutionary discoveries but they are still advantageous products and usually have a prospective market in society. Robert Olson provided an example for forced analogy in his book ‘The Art of Creative Thinking.
(xix) Daydreaming:
Daydreaming is truly one of the most fundamental ways to trigger great ideas. It enables a person to establish an emotional connection with the problem, which is beneficial in terms of coming up with a wonderful idea.
The focus of productive daydreaming is a particular goal irrespective of whether it seems to be an impractical task. If the Wright brothers had not let their imagination run wild, thinking about flight, no one would have been flying.
(xx) Reverse Thinking:
As the term ‘reverse thinking’ itself suggests, instead of adopting the logical, normal manner of looking at a challenge, you reverse it and think about opposite ideas as it easier to produce ideas for the ‘negative challenge’ simply because it is much more fun. However, too much time should not be wasted on the reverse idea-generation. After one session is over, it can be continued in the reverse idea atmosphere with a new challenge
(xxi) Questioning Assumptions:
By questioning assumptions, at every step of service or product development, planners can actually enable the birth of fresh possibilities and ideas. The participants should start by settling on the framework for the creative challenge.
After this, they should produce 20 to 30 assumptions irrespective of whether they are true or false. The next step is to select several assumptions from the many generated, and utilize them as idea triggers and thought starters to engender fresh ideas.
(xxii) Accidental Genius:
Accidental genius is a relatively new technique that utilizes writing to trigger the best ideas, content and insight.
(xxiii) Brainwriting:
Instead of asking the participants to shout out ideas as in case of brainstorming, they are told to pen down their ideas pertaining to a specific problem or question on sheets of paper, for a small number of minutes. After that, each participant can pass their ideas over to someone else.
This someone else, reads the ideas on the paper and adds some new ones. Following another few minutes, the individual participants are again made to pass their papers to someone else and so the process continues. After about 15 minutes, someone else can collect the sheets from them and post them for instant discussion.
(xxiv) Wishing:
This technique begins by asking for the unattainable and then brainstorming ideas to make it or at least an approximation of it, a reality. Start by making the wishes tangible. There should be collaboration among the members of the team to produce 20 to 30 wishes pertaining to the business. The more bizarre the idea, the better it would be. There should be no restrictions on thinking.
(xxv) Socializing:
Socializing in the context of ideation can also be about talking to others on topics that have nothing whatsoever to do with the present problem. Even such persons can come out with bright ideas.
(xxvi) Collaboration:
As the term indicates, collaboration is about two or more people joining hands in working for a common goal. Designers frequently work in groups and engage in collaborative creation in the course of the whole creative process.
9. Essay on Business: Need for Ethical Considerations in Business Enterprises:
The term ‘business ethics’ came into common use in the United States in the early 1970s. By the mid-1980s at least 500 courses in business ethics reached 40,000 students, using some twenty textbooks and at least ten casebooks. The Society for Business Ethics was started in 1980. Firms started highlighting their ethical stature in the late 1980s and early 1990s,
The term Ethics comes from the Greek word ethos, which means “character”.
Ethics, also known as moral philosophy, is a branch of philosophy that involves systematizing, defending and recommending concepts of right and wrong conduct. Ethical behaviour is characterized by honesty, fairness and equity in interpersonal, professional and academic relationships and in research and scholarly activities. Ethical behaviour respects the dignity, diversity and rights of individuals and groups of people.
Business ethics are implemented in order to ensure that a certain required level of trust exists between consumers and various forms of market participants with businesses. For example, a portfolio manager must give the same consideration to the portfolios of family members and small individual investors. Such practices ensure that the public is treated fairly.
Business Enterprises must be ethical towards the following partners:
A business enterprise needs to be ethical towards Customers, employees, Government, Society, shareholders, third parties, competitors, women employees, minority communities and all genders.
These have been briefly, discussed below:
(i) Customers:
A business can be ethical towards customers by giving them good quality product/service, promised quantity, fair price and hindrances free after sale service. The advertisements should not be misleading.
(ii) Employees:
Employees must be given fair wages and all welfare activities should be carried on by the business to support employee cause. Use of child labour and forced labour should not be resorted to by the business. Efforts must be made by the business to keep the morale high of the employees. No Violation of the basic rights of workers should be done.
(iii) Government:
In order to be ethical towards the government, the business must pay all taxes in time and must carry on a legal business without violating any sections of any acts in force.
(iv) Society:
Every business takes all the resources from the society therefore it has a moral obligation to discharge social responsibilities, in order to be fair and ethical towards the society. Health, safety and environmental standards must be maintained by all businesses.
(v) Shareholders:
Many unethical companies take the shareholders for a ride by giving them wrong information or hiding information from them. In fact the board of directors, who are responsible for running the affairs of the company, are required to be ethical towards shareholders as they are the real owners of the share capital of the company.
(vi) Third Parties:
Third parties such as the Bankers, Financial institutions, debenture holders etc., must be treated fairly by the company. Window dressing by companies is a typical unethical behaviour.
(vii) Competitors:
Though it is a famous saying in business that “all is fair in love, war and business”, but it does not imply that the business should aim to ‘kill, crush, conquer’ competition by treating them as enemies. The competitor’s product or service should not be projected in a negative light, at the time of advertising.
(viii) Women Employees:
With the growing cases of crime against women, it has become the moral duty of the employer to treat women employees with respect and take all measures to ensure their safety. Cases of sexual harassment should be dealt with severely.
(ix) Minority Communities:
The employer has to adopt a just and balanced approach for all, and make sure that there is no oppression of minority communities.
(x) All Genders:
It is also unethical to treat people differently on the basis of gender. This sensitization has to come especially when many countries are making laws for third gender, so that they are also treated as part of the society.
10. Essay on Business: Social Responsibility:
Social responsibility means – ‘responsibility towards society’. Since business organizations are a part of society, they carry a responsibility towards it. At the first instance, talking about social responsibility seems to be making charities for social causes. But the concept of social responsibility of business is much wider.
Being socially responsible means responsible for fairness in the dealings with customers and suppliers, responsible towards employees in providing them good working conditions, responsible towards protection of environment by controlling the polluting wastes, responsible for providing safe and standard good and services, responsible enough not to harm public, and so on.
Following are some examples of areas of social responsibility of business:
1. Consumers – Product information. Fair advertising and packaging, product safety and quality. Service, warranties, guarantees.
2. Environment – Control of air, water, and solid waste pollution. Conservation of energy and other resources. Minimizing noise, odor, and visual pollution.
3. Individual – Fair employment and non-discriminatory practices. Affirmative action. Employee rights of speech, privacy, and safety.
4. Community-Corporate giving and community involvement. Urban development, job training, support of education and the arts, cooperating with local Government.
5. Government – Obeying laws and regulations. Cooperating with local, state, and central government to deal with social issues.
6. Society (at large) – Corporate governance; role of board, dealings with shareholders and other interested groups. Stand on national and international issues.
Understandable as a concept, but the question is – do business organizations recognize and adopt their responsibility? Earlier, the commercial organizations used to operate with the sole objective of earning profits. But over the years, the business entity has become not only our most important economic institution but also a major force for social change.
The reason is twofold, one, the economic institutions have become a major source of power and influence, and community has become conscious towards the role of business.
Some of the drivers pushing business towards socially responsible attitude are:
1. Shrinking Role of Government:
In the past, governments have relied on legislation and regulation to deliver social and environmental objectives in the business sector. Shrinking government resources, coupled with a distrust of regulations, has led to the exploration of voluntary and non-regulatory initiatives instead.
2. Demands for Greater Disclosure:
There is a growing demand for corporate disclosure from stakeholders, including customers, suppliers, employees, communities, investors, and activist organizations.
3. Increased Customer Interest:
There is evidence that the ethical conduct of companies exerts a growing influence on the purchasing decisions of customers.
4. Growing Investor Pressure:
Investors are changing the way they assess companies’ performance, and are making decisions based on criteria that include ethical concerns.
5. Competitive Labour Markets:
Employees are increasingly looking beyond paychecks and benefits, and seeking out employers whose philosophies and operating practices match their own principles. In order to hire and retain skilled employees, companies are being forced to improve working conditions.
6. Supplier Relations:
As stakeholders are becoming increasingly interested in business affairs, many companies are taking steps to ensure that their partners conduct themselves in a socially responsible manner. Some are introducing codes of conduct for their suppliers, to ensure that other companies’ policies or practices do not tarnish their reputation.
Note that Corporate (business) social responsibility promotes a vision of business accountability to a wide range of stakeholders, besides shareholders and investors. Key areas of concern are environmental protection and the wellbeing of employees, the community and civil society in general, both now and in the future.
Nevertheless, many companies continue to overlook their social responsibility – for example by importing and retailing timber that has been illegally harvested. While governments can impose embargos and penalties on offending companies, the organizations themselves can make a commitment to sustainability by being more discerning in their choice of suppliers.
11. Essay on Business: The Changing Environment in Business:
In order to drive successfully to the future, firms will need to take a fresh look at all the aspects of their business particularly along the three key dimensions of strategy, organisation and leadership. The starting point will be to understand which way the future will move in general as well as in industry-specific terms. The path breaking work of Alvin Toffler, Charles Handy, John Naisbitt and Lester Thurow provide a glimpse of the unfolding future and identify the specific factors that need to be addressed for maintaining industry leadership.
Toffler mentions about increasing “demassification” and predicts that mass market will be splitting into a large number of mini-markets that will demand more options, models, types, sizes, etc. Handy points out the declining longevity of every institution and advices the need for greater flexibility in organisation and management processes, rooted in a core set of activities and competencies.
He also perceives that to manage the emerging uncertainly, firms will need to give more importance to people with intellectual brilliance and sophistication, and that unless organisations are willing to give’ more power-vis-a-vis the top management and share- holders-to those who possess intellectual capital, it will not be possible to hedge against future risks.
Naisbitt puts forward the view that large firms who are able to organise themselves as a collection of self-managed units organically networked to each other, will dominate the future. According t0 him, such units which have the speed and flexibility of small companies with the resource backup of the large firms, will be able to create differentiation continuously by their sheer speed of innovation.
The picture of the fit tree, as drawn by Naisbitt, is one that will be dominated by small and medium-sized companies; even in highly capital intensive industries, the scale will have to be brought down to an appropriate level which will be smaller but more powerful than the scale conventionally thought of.
He also predicts the gradual emergence of the huge, single market economy, thanks to the revolution achieved in telecommunication but believes that there will be two specific phenomena which both companies and individuals will have to live with. First of these two is the strong need for global integration for greater economies of scale; while the second is the all-out efforts of individual societies and countries to stick to their own culture and basic identity. To reconcile these apparently diverse requirements and become successful in the future, companies will need to reconfigure themselves into small, fast moving outfits.
Lester Thurow observes that the 21st century will be characterised by an intense head-to-head competition among firms, and that the basis of this competition will not be such factors as natural resources or factory strength but the ‘brain power’ of the people capable of developing new materials and processes. This implies that competition may occur at any place and from anywhere, not necessarily confined to the resource base and strengths of existing firms.
He believes that given this future scenario, niche competition-which emphasises a win-win pattern of behaviour-will be replaced by head-to-head competition. The key to face this new development will be to ensure the right education and skill for the workforce and to make the latter capable of operating low-cost high-tech processes and innovating new products.
The four authors point towards the emergence of an environment that will be very different from what individual and companies have seen till date. Markets are getting increasingly ‘demassified’ and different sources of competition are likely to come up from countries and organisations that had not been thought of as possible even a few years ago.
The new basis of competitive advantage will not be the natural resources or traditional strengths, but the brainpower or intellectual capital of the people. The organisation of the future in order to survive and grow in the new environment will have to become more flexible in terms of both configuration and size and there will be a greater thrust on networking that will transcend the legal boundaries of firms.