Business Jargons A Business Encyclopedia

Definition: In business terminology, goodwill is the monetary worth of the advantage which a firm possesses over the other firms in the market with respect to profits which are expected to be derived in future over and above the normal profits. As the time goes by, a business develops a good reputation, name, strong connections…

Definition: Responsibility Centre refers to an operating segment within the firm, lead by the manager who is accountable for its activities, performance and results, in terms of expenditure, profit, and return on investment. A responsibility centre has its own goal and objectives, plans and strategies, policies and procedures. Further, it has a dedicated team or…

Definition: Economic Activities implies all the activities of producing, distributing, trading, consuming, exchanging and supplying, goods and services of value, at any level, in a society, for monetary consideration. These activities are undertaken with the aim of making money, acquiring wealth, earning a livelihood, and generating income from different sources. The economic activity in a…

Definition: Operations Management can be understood as an area of management which is concerned with the government of system, processes and functions that manufacture goods and renders services to the end user, to provide desired utilities to them while adhering to other objectives of the concern, i.e. efficiency, effectiveness, and productivity. Objectives of Operations Management…

Definition: Internal environment is a component of the business environment, which is composed of various elements present inside the organization, that can affect or can be affected with, the choices, activities and decisions of the organization. It encompasses the climate, culture, machines/equipment, work and work processes, members, management and management practices. In other words, the…

Definition: Quality Assurance is a managerial tool that encompasses all the systematic actions required for providing sufficient confidence, that a product will meet the requisite quality. Here, the confidence is bifold, as in internally to the company’s management and externally to the stakeholders such as customers, creditors, clients, society, government agencies, third parties, etc. Altogether,…

Definition: Diversification can be understood as the corporate strategy that a company implements to increase the market share and sales volume by introducing new products in new markets or industry, which is distinct from its core business. Simply put, diversification refers to the expansion of business by entering into a completely new segment or investing…

Definition: Functional Level Strategy can be defined as the day to day strategy which is formulated to assist in the execution of corporate and business level strategies. These strategies are framed as per the guidelines given by the top level management. Functional Level Strategy is concerned with operational level decision making, called tactical decisions, for…

Definition: Competitive Strategy can be defined as the firm’s long term action plan that formulated by considering several external factors, that helps the company to achieve competitive advantage, increase the share in the market and overpower rivals. Competitive advantage is the result of the firm’s excellence in performing activities. The firm’s external environment, has the…

Definition: A company is that form of business organization, which is created by law. It refers to an association of persons, created to undertake business activities, having a separate legal existence, perpetual succession and a common seal. It is a legal entity incorporated under the Companies Act, 2013 or any other previous acts, prevalent in…