2. Business and Management Chapter 1 College of Science and Human Studies at Ghat Female Branch Instructor: FATMA LETAIEF 1 st Semester 1436/1437

3. After studying this chapter you should be able to. 1- Explain what is meant by "Business". 2- Explain the objectives of business. 3- Explain the essential of good business. 4- Describe the business environment. 5- Explain the concept of management. 6- Describe the characteristics of management. 7- List the functions and levels of management. 8- Outline the skills of management 9- Explain levels of management 10-Explain the functions of management

4. 1- What is the Business? The term 'business' signifies individual and group activities directed toward wealth generation through exchange of goods and services. Business, as a system, uses various inputs like men, material, machinery, information and energy to create goods and services as output to meet the needs of the consumers. Business involves risks and the profit gained is the reward for risk- taking. The common risks are changing technology, changes in consumer preferences, competitive threats, and government policies. Business influences the living standard of people and is the leading indicator of the development of any nation.

5. 2- objectives of Business The objectives of business are two-field: economic and social. 2-1-Economic objectives include: (a) Ensuring a satisfactory return on investment (ROI). (b) Growth of business through diversification, merger, or acquisition. (d) Ensuring profitability by gaining strong market position. 2-2-Social objectives include (a) Prevention of environmental pollution and ecological ambiance. (b) Overall development of the locality where the business is situated. (c) Development of backward areas. (d) Promotion of ancillary and small scale industries.

6. 3- Essential of good Business The essentials of good business are: 1. A business must have well defined and attainable objectives. 2. It should follow an appropriate planning procedure based on up-to-date, reliable, and adequate information. 3. It should have a right layout and location so as ensure minimization of costs and maximization of profits. 4. A business should have a responsive and adaptive management. 5. It should have a sound organization ensuring effectiveness. 6. A Business should have a customer-focused marketing system.

7. 4- Business environment Just as human beings live influence and get influenced by an environment, similarly businesses also affect and get affected by the environment in which it operate. The environments may be classified in four groups: Economic, Social, Political and Legal. These are discussed below.

8. 4-1-Economic Environment: It is sometimes thought that the economic environment is of concern only to businesses whose socially approved mission is the production and distribution of goods and services that preference want and can pay for. But it is also of the greatest importance to other types of organized enterprises.. The factors affecting an economic environment are. Capital, Labor, Customer, Government taxes, Price levels.

9. 4-2- Social Environment The social environment is made up of the attitudes, desires, expectations, degrees of intelligence and education, beliefs, and customs of people in a given group or society. The concept of social responsibilities requires organizations to consider the impact of their actions on society ethical environment, which could well be included as an element in the social environ; includes sets of generally accepted and practiced standards of personal conduct. These STANDERS may or may not be codified by law, but for any group to which they are meant to apply sometimes have virtually the force of law.

10. 4-3- Political Environment: The political environment has an effect on the business in the world economics. We can see the difference between the business in the European versus Arab countries. These differences are causes some factors. One of these factors have the effects is the political environment. It has considered as the building blocks of business success.

11. 4-4- Legal Environment: Every manager is encircled by a web of laws, regulations, and court decisions not only or national level but also on the state and local levels. Some are designed to protect workers consumers, and communities. Others are designed to make contracts enforceable and to property rights. Many are designed to regulate the behavior of managers and their suborder in business and other enterprises.

12. 5- Concept of management Managing is the art of getting things done through people in formally organized. Management can thus be defined as the art or skill of directing human activities and resources in the predetermined goals. Management is practiced with the help of five basic functions: planning, organizing, staffing, directing and controlling.

13. 6-Characteristics of management We have just read about the meaning of management. Now let us discuss its characteristics: (i) Management is a goal directed activity. (ii) This is called co-ordination (iii) This is known as decision making. (iv) Management is an economic-activity. (v) Management is a creative activity.

14. 7-Nature of management: is it the art or science ? We have discussed the various interpretations of the term ‘ Management ’. When a manager performs his functions or takes decisions, the systematized body of knowledge helps him to apply one or more principles or methods in the course of his activities. In this sense management is a science. However, we have to apply our skill and judgment rather than simply use the methods and principles known to him. In this sense, management may be regarded as an art. Therefore, management may be regarded as both a science as well as an art.

15. 8- Management Skills Three basic kinds of skills — technical, human and conceptual are needed for a manager. Technical skill is the ability to use the procedures, techniques, and knowledge of a specialized field. For examples, surgeons, engineers, and accountants all have technical skills in their respective fields. Human skill is the ability to work with, understand, and motivate other people as individuals or in groups. Conceptual skill is the ability to coordinate and integrate the organization's goals and activities.

16. 9-levels of management We have already stated how managers jointly perform the various functions. Different managers perform different types of duties. Some managers decide about the objectives of the business as a whole. Some managers perform functions to achieve these objectives in different departments, like production, sales, etc, and some of the managers are concerned with the supervision of day-do- day activities of workers. Managers performing different types of duties may, thus, be divided into three categories: Top-Level Management Middle-Level Management Lower-Level Management

17. 10-functions of management We have already discussed that management is a process. It comprises different stages. These stages in the process are known as the functions of management. Each of these functions are described below: (a)Planning (b) Organizing (c) Staffing (d) Directing (e) Controlling (f)Co-ordination

18. (a) Planning Planning requires decisions to be made on what should be done, how it should be done, who will do it, where it will be done, and why it is to be done. The essential part of the planning consists of setting goals and programmers of activities. (b) Organizing After plans have been drawn, the management has to organize the activities. Managers determine what activities are necessary to achieve the objectives and how these activities should be divided among the departments and employees. (c) Staffing Staffing is concerned with employing people for the various activities to be performed. The objectives of staffing is to ensure that right type of people have been recruited for different positions. It includes the function of recruitment, selection, and placement of employees.

19. (d) Directing The directing function of management includes guiding the subordinates, supervising their performance, communicating information and motivating. A manager should be a good leader. (e) Controlling Controlling means measuring the actual performance with the planned one. If differences are noticed, corrective steps are taken which may include revision of plans, improvement in the division of work and providing better guidance. (f) Co-ordination The heads of different departments should not treat each other as competitors but should work as organs of one body.. This function of management is called co-ordination. It consists of harmonizing group effort so as to achieve common objectives.

20. End of Chapter 1