Sole Proprietorship

Definition: As the name suggests, ‘sole’ means ‘only one’ and ‘proprietorship’ implies ‘ownership’. Hence, a¬†sole proprietorship is a form of business organisation, wherein a single person owns, manages and controls, all the business activities and the individual who operates the business is called as a sole proprietor¬†or, a sole trader. In this business unit, the…

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Porter’s Five Forces Model

Definition: Porter’s five forces model, refers to a framework based on the competitive analysis, introduced by Harvard Business School Prof. Michael E. Porter. The model determines the intensity of competition in any industry is a mix of five competitive factors operating in different areas of the whole market. The framework is an outside-in strategy tool…

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Commercial Paper

Definition: Commercial Paper or CP is defined as a short-term, unsecured money market instrument, issued as a promissory note by big corporations having excellent credit ratings. As the instrument is not backed by collateral, only large firms with considerable financial strength are authorised to issue the instrument. Features of Commercial Paper The maturity period of…

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Total Quality Management (TQM)

Definition: Total Quality Management, abbreviated as TQM is a people-oriented management system, wherein all the members of the organisation, makes continuous efforts so as to maintain high work standards, in all the operations of the company. Its main aim is to make a continuous increase in the customer loyalty and satisfaction, at constantly lower cost.…

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Strategic Business Unit (SBU)

Definition: Strategic Business Unit (SBU) implies an independently managed division of a large company, having its own vision, mission and objectives, whose planning is done separately from other businesses of the company. The vision, mission and objectives of the division are both distinct from the parent enterprise and elemental to the long-term performance of the…

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Outsourcing

Definition: Outsourcing, the name itself suggest its meaning, i.e. source from outside. It refers to a practice of contracting out the non-core and sometimes core activities of the organisation to a captive unit or a third party. It is a process, in which business-houses handover their regular or peripheral work to the external organisation, who…

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Business Environment

Definition: Business Environment means a collection of all individuals, entities and other factors, which may or may not be under the control of the organisation, but can affect its performance, profitability, growth and even survival. Every business organisation operates in a distinctive environment, as it cannot exist in isolation. Such an environment influence business and…

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Entrepreneurship

Definition: Entrepreneurship refers to the process of creating a new enterprise and bearing any of its risks, with the view of making the profit. It is an act of seeking investment and production opportunity, developing and managing a business venture, so as to undertake production function, arranging inputs like land, labour, material and capital, introducing…

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Benchmarking

Definition: Benchmarking, is a tool of strategic management, that allows the organisation to set goals and measure productivity, on the basis of the best industry practices. It is a practice in which quality level is used as a point of reference to evaluate things by making a comparison. The process helps in comparing and gauging…

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Change Agent

Definition: In business parlance, a change agent is an individual or group, who carry out the task of instigating and managing change in the organization. He/She is someone, who directly or indirectly influences change, i.e. the change agents are appointed by the organizations to transform the ways, the organization is managed, or the business is…

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