Labelling

Definition: Labelling is a part of branding and enables product identification. It is a printed information that is bonded to the product for recognition and provides detailed information about the product. Customers make the decision easily at the point of purchase seeing the labelling of the product. Labels must comply with the legal obligations. A…

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Motivation

Definition: Motivation is a driving force which affects the choice of alternatives in the behaviour of a person. It improves, stimulates and induces employees leading to goal-oriented behaviour. For example, promotion is a motivating factor as employees work to achieve preset targets for getting a promotion. Motivation can be monetary, e.g., rewards given in the…

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Controlling

Definition: Control is a primary goal-oriented function of management in an organisation. It is a process of comparing the actual performance with the set standards of the company to ensure that activities are performed according to the plans and if not then taking corrective action. Every manager needs to monitor and evaluate the activities of…

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Balance Sheet

Definition: A Balance Sheet refers to the position statement, which lists out the balances of the assets, liabilities and owner’s equity, i.e. capital, of an enterprise at a specified date. While the assets show the resources owned by the company, liabilities and capital exhibits the funding of resources. Characteristics of Balance Sheet The preparation of…

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Private Equity

Definition: Private Equity firms are described as the investment fund companies that invest in the capital of the enterprise so as to acquire a strategic stake in it, once it is set up as a successful unit. The capital injected by private equity firms in a company which forms a part of their equity capital…

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Lease

Definition: Lease is a financial arrangement, wherein one party (lessor) allows another party (lessee) to use the capital asset or equipment for a definite period, in return for an adequate consideration, i.e. lease rental charges. In this contract, the lessee need not buy or own the asset in order to use it, because it is…

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Key Performance Indicator (KPI)

Definition: Key Performance Indicator (KPI) refers to monetary and non-monetary measures that an organization employ to define and measure the progress towards achievement of long-term goals of the organization. These factors are fixed and predetermined in nature and comprise more meaning if it is compared with the information. KPI varies from organization to organization such…

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Business Risk

Definition: By the term ‘business risk’ we mean the uncertainty with respect to firm’s operations. It is a type of systematic risk wherein there is a┬ávolatility associated with the future income or earnings arising from events, circumstances, conditions, action, or inactions that hinders the attainment of goals and objectives and carry out the strategies. Business…

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Activity-Based Management (ABM)

Definition: Activity Based Management (ABM) can be understood as the cost management implementation of activity-based costing. It is a management approach that concentrates on efficiently and effectively managing the activities so as to improve the quality of goods and services offered to the customers and also increase the profitability and competitiveness of the organization. ABM…

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Management by Objectives (MBO)

Definition: Management by Objectives (MBO) or otherwise called as Management by Results (MBR) is management philosophy which was first propounded by Peter F. Drucker in the year 1954, in his book “Practice of Management”. Management by objectives is a planning and controlling system, in which the superior and subordinates work together in order to define…

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