BUSINESS
STUDIES – CHAPTER 1: ENVIRONMENTS
(MICRO, MARKET, AND MACRO
AND SECTORS OF THE ECONOMY)
GRADE 10
VOCABULARY
2.
1. Marketing 5. Institutional
Interrelationship 3. Regulators 4. Intermediaries
Function environment
of functions
6. Demographic 7. Legal 8. 9. Sole
10. Partnerships
environment environment Entrepreneurship proprietorship
11. Human 12. General 13. Factors of 14. Secondary
15. Formal Sector
Resources Management Production Sector
The concept of a business
A “Business” refers to the
specific processes that add value
to an economic society and/or to
the particular country in which it
operates.
Characteristics of successful business
Strong leadership
Create a competitive advantage
Satisfy the needs and wants
Use resources
Responsible, accountable and
transparent corporate citizen
Important objectives of a business
Survival
Social Profitability
Responsibility and growth
Long-term
Objectives
Technological Productivity
Development and efficiency
Employee
development Competitive
and Advantage
relationships
BUSINESS ENVIRONMENTS
Macro – it is
also know as
the external
environment.
Market – it is also
known as the
industry
environment and
is immediately
outside the micro
business
environment. Micro – it is also
referred to as the
internal
environment.
Micro Environment
Functions of business
Organisational resources
Management
Business organisational structure
Organisational culture
Goals
Eight Business Functions
The eight business functions are all part of the business.
Some businesses may not have all of the functions.
The role and importance of the business functions:
Their role is to ensure that the goals of the business are
achieved.
Each of the function has an important job to do and the
different parts cannot work on their own.
Eight Business Functions (contd.)
General management – the umbrella function of any
business.
Purchasing – responsible for buying all the raw materials,
machinery, equipment and services for the business.
Production – is responsible for the production of goods
and services.
Marketing – carries out market research to assess the
demand from the consumers.
Eight Business Functions (contd.)
Public Relations – responsible for keeping customers,
suppliers, shareholders and anyone involved in the
business happy.
Human Resources – it looks after the employees or
workers in the company.
Administration – supports all the other business functions.
Finance – handles all the money matters of the business.
ORGANISATIONAL STRUCTURES
This is the hierarchy that determines the positions of management, the
departments and employees.
The organizational structure is influenced by the following:
Size
Resources
Goals
Example of an organisational structure:
RESOURCES
• Everything that is available to produce goods or deliver a service.
• These resources can be:
human resources
financial resources
physical resources (raw materials, equipment)
Micro Environment
Factors of production:
Entrepreneurship
Human
Resources Capital
Raw Materials
The Business Policy
• The framework drafted by the business to describe its vision, mission, goals and
objectives as well as policies and procedures to guide behaviour within the
business.
1. The Vision – the current position of the business and the ideal position the
business would like to achieve.
2. The Mission – the refinement of the vision and it specifies the core business
functions and the reason why the business exists.
3. Goals and objectives – goals are the long-term accomplishments that the
business wants to achieve while objectives describe the short-term tasks which
must be achieved to assist the business in reaching the long-term goals.
4. The Organisational Culture – can be described as the values and beliefs that are
shared within the business.
STRATEGY
• A business strategy describes how a particular business (department) intends to
succeed in the chosen market, and against competitors.
• The purpose of a business strategy is to use the business’s resources to gain and
sustain a competitive advantage in the chosen market by meeting the needs of the
customers.
• The chosen strategy should be in line with the business’s vision/mission, culture and
code of ethics.
• In grade 11 and 12 we will look at the following strategies in detail:
Growth Strategy
Decline Strategy
Corporate Combination Strategies
Low Cost Strategy
Differentiation Strategy
Focus Strategy
Organisational (Business) Culture
Business culture refers to the beliefs
and values in the business.
These values and beliefs are what
direct the behavior and attitudes of
the internal stakeholders of the
business.
