Getting Down to Business

Read this section learn about internal and external factors that affect the success of businesses. Pay particular attention to Figure 1.2 to gain an understanding of where each of these factors falls.

Key Takeaways

  • The main participants in a business are its owners, employees, and customers.
  • Businesses are influenced by such external factors as the economy, government, consumer trends, and public pressure to act as good corporate citizens.

  • The activities needed to run a business can be divided into five functional areas:

    1. Management involves planning, organizing, staffing, directing, and controlling resources to achieve organizational goals.
    2. Operations transforms resources (labor, materials, money, and so on) into products.
    3. Marketing works to identify and satisfy customers' needs.
    4. Finance involves planning for, obtaining, and managing company funds.
    5. Accounting entails measuring, summarizing, and communicating financial and managerial information.