Ayussh Sanghi is teaching live on Unacademy Plus
Strategic Managament Chapter 1-Business Environment Lesson 1.1 Presented by CA Ayussh Sanghi
What is Business? . According to Peter F. Drucker: . Business is created & managed by people. . It is a group of people who will take decisions which will determine whether the business will be successful or not, will t survive or will t eventually (come to an end) perish.
Business in terms of profit The business cannot be explained just in terms of profit. Profit maximisation means selling at a higher price than the cost. . In present time, the economic principle of profit maximization has little relevance. It has been linked with long term perspective & has been modified to include - . Development of wealth Non-financial factors such as goodwill, societal factors, relations etc
Objectives of Business . Growth: Every enterprise seeks growth, the extent of which may differ& depends largely on the goals/ambitions (aspirations), limitations (constraints) & other internal/ external factors. Example: It may take the form of any one or more of the following Increase in assets, manufacturing facilities Increase in sales volume in existing products or through new products; . Increase in manpower employment; . Diversification i.e. venturing into new projects/ fields, etc.
Objectives of Business Stability: . A stable & steady enterprise minimises managerial pressure/ tensions & demands less dynamism from managers/owners Therefore, it is the least expensive & risky objective of any enterprise.
Objectives of Business Survival . It is the willpower & concern/fear (anxiety) to continue into the future as long as possible. Survival gains importance during the initial stages (beginning) of an enterprise & during general economic adversity.
Objectives of Business .Efficiency .Every business enterprise seeks efficiency in: . Choosing appropriate means to achieve their goals, doing things in the best possible manner, and utilizing resources in the most suitable combination to get highest productivity.
Spread the word of this education revolution