Chapter 1:
Business Now
Change is the Only Constant
Looking Ahead
LO1 Define business and discuss the role
of business in the economy
LO2 Explain the evolution of modern
business
LO3 Discuss the role of not-for-profit
organizations in the economy
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Looking Ahead
LO4 Outline the core factors of production
and how they influence the economy
LO5 Describe today’s business
environment and discuss each key
dimension
LO6 Explain how current business trends
might influence your career choices
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LO1 Business Now:
Moving at Breakneck Speed
– In the last decade, the players, what
consumers want, and how we buy has
changed
– Companies are being launched and
growing faster than ever
– Mature firms are being merged, acquired,
and dissolved
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Business Basics
Business – any activity
that provides goods and
services in an effort to
earn profit
Not-for-profit
organizations –
focus on causes not
profit
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Business Basics
Profit – the financial reward
that comes from starting and
running a business; the
money that a business earns
in sales (or revenue), minus
expenses
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Business Basics
Entrepreneurs –
people who risk time,
money, and other
resources to start and
manage a business
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Business drives up the
Standard of Living,
which, in turn, contributes
to the Quality of Life
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Business Encourages
Entrepreneurial Spirit
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LO2 The History of Business:
Putting It All In Context
Assembly Line
Consumer Power
Industrial Titans
Refining Production
Wealth Creation
Productivity Gains
Growth in
Consumerism
Satisfied Customers
Decrease Costs
Product Differentiation
Increase in Living Standard
Use of Technology
Manipulation/Competition
Hard Sell
Exploitation
No Customer Focus
Mass Production
Factories
Long-term
Relationships
Customer Focus
Work Specialization
Efficiency
Industrial
Revolution
1700-mid
1800s
Entrepreneurship Production
Era
Era
Second half of
Early 1900s
1800s
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Marketing
Era
1950s
Relationship
Era
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LO3 Not-For-Profit Organizations
and the Economy: The Business
of Doing Good
– Not-for-profit organizations focus on health,
human services, education, art, religion,
and culture
– Canada’s 161 000 non-profits contribute
more than $80 billion to the economy
– While focused on “doing good” rather than
financial gain, non-profits are businesses in
every other sense: they employ people,
take in revenue, and produce goods and
services
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LO4 Factors of Production:
The Building Blocks
Natural Resources
Capital
Human Resources
Entrepreneurship
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– Businesses rely on
some combination of
these factors
– Entrepreneurial activity
can kick-start an
economy by harnessing
the other factors of
production
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LO5 The Business Environment:
The Context for Business
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Economic Environment
Free enterprise and fair competition flourish in Canada
Government takes an active role to support
businesses:
–Economic development is supported by
Industry Canada
–Provinces promote economic development
by providing investment and tax incentives
–Legislation supports enforceable contracts
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Economic Vulnerabilities
– CEO/Worker pay gap
– Corruption and ethical
lapses
– Consumer debt
– Federal/provincial debt
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Competitive Environment
– Today’s competition is intense
– Companies must focus on loyal customers
because they are the vocal promoters of
their products/services
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Competitive Environment
– Companies must provide unsurpassed
value
• Value is the size gap between benefit
and price
• The cheapest product does not mean
value
• The key to value is quality
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Competitive Environment
– How fast firms get products to market can
be a competitive advantage
• Bleeding edge firms launch products that fail
because they are ahead of the market
• Leading edge firms offer products just as the
market is ready
Apple computers was not first
to the MP3 market but they
now own 75% market share
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2014 by Nelson Education Limited
Employees are another
key competitive
advantage
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Competitive Principles
– Avoid your competitors’ strengths and exploit
their weaknesses; don’t try and beat them at
their game
– Always be a little paranoid; never
underestimate your competition
– Competitors will usually get better when
pushed
– Competitors are sometimes irrational
when pushed
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Competition is Changing
– Top 10 global
brands all U.S.based
– Japan, Germany,
Finland, S. Korea,
and Francebased brands all
included among
the next 10 best
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Insert exhibit 1.3, p. 8,
C2e
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Inventions with Impact
(Can you identify four Canadian inventions?)
Disposable diapers
Cat litter
Poutine
Insulin
Zippers
Great Inventions
that have
impacted human
life….for better or
for worse
Bikinis
Laptop
Blackberry
Viagra
Camcorder
Kool-Aid
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Astroturf
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Technological Environment
– Business technology includes any tools
that businesses can use to become
efficient and effective
• Source of competitive advantage
• Industries have experienced dramatic change
• New industries have emerged
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Technological Environment
– Technology continues to evolve at
breakneck speed; the
change in everyday life
and business operations
is almost unimaginable
– Companies that welcome
change and manage it
well will clearly be the
winners
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Social Environment
– Diversity
– Aging population
– Rising worker
expectations
– Ethics and social
responsibility
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Shades of Green: The Six Sins of
Greenwashing
 Sin of hidden trade-off
 Sin of no proof
 Sin of vagueness
 Sin of irrelevance
 Sin of lesser of two evils
 Sin of fibbing
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Global Environment
Technology is linking
customers/suppliers
worldwide
China and India’s
economies are
growing
Technology
Free Trade
Natural Disasters
Job Migration
Terrorism is more
of a threat today
Blurred lines between
countries/world
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Global Environment
– Both China and India
have been growing
relatively fast due to
foreign investment and
internal development
– China has been a
magnet for
manufacturing jobs and
India for high tech jobs
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LO6 Business and You:
Making it Personal
– What are your
passions?
– What are
business careers
that encompass
your passions?
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Looking Back
– What is the role of business in the
economy?
– How has business evolved?
– What is the role of non-profits in the
economy?
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Looking Back
– What are the core factors of production?
– What are the elements of the environment
affecting business?
– How are business trends impacting
careers?
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