Business management conspect
MNC – multinational company – company that operates in two or more countries.
Reasons for MNCs:
1) An increased customer base
2) Cheaper production costs (inexpensive labor)
3) Economies of scale (network of roads, telecommunication and ports)
4) Brand development and brand value
5) Spreading risks
Impact on host country (where MNCs are located):
1) Job creation
2) Higher national income
3) Knowledge and technology transfer
4) Increased competition (boosts efficiency)
5) Job losses
6) Vulnerability (companies can relocate very fast)
Areas of effective business:
1) Human resource management – leadership, motivation and overall employee relations;
2) Finance and accounts – managing company’s money ensuring smooth financial processes;
3) Marketing – market research, branding and distribution;
4) Operations management – converting raw materials into finished goods.
Sectors:
1) Primary sector – extraction, harvesting and conversion of natural resources.
2) Second sector – manufacturing and construction.
3) Tertiary sector – providing service. Like, transportation, banking, insurance, healthcare and so
on.
4) Quaternary sector – technology and intellectual activities.
Challenges and opportunities for starting business:
Lack of finance
Unestablished customer base – new businesses don’t have loyal and long-term customers
Cash flow problems – businesses run out of money
Opportunities:
Growth – business growths and becomes profitable
Earnings – having entrepreneurial mindset can bring way more earnings than any job could ever
bring
MNC – multinational company – company that operates in two or more countries.
Reasons for MNCs:
1) An increased customer base
2) Cheaper production costs (inexpensive labor)
3) Economies of scale (network of roads, telecommunication and ports)
4) Brand development and brand value
5) Spreading risks
Impact on host country (where MNCs are located):
1) Job creation
2) Higher national income
3) Knowledge and technology transfer
4) Increased competition (boosts efficiency)
5) Job losses
6) Vulnerability (companies can relocate very fast)
Areas of effective business:
1) Human resource management – leadership, motivation and overall employee relations;
2) Finance and accounts – managing company’s money ensuring smooth financial processes;
3) Marketing – market research, branding and distribution;
4) Operations management – converting raw materials into finished goods.
Sectors:
1) Primary sector – extraction, harvesting and conversion of natural resources.
2) Second sector – manufacturing and construction.
3) Tertiary sector – providing service. Like, transportation, banking, insurance, healthcare and so
on.
4) Quaternary sector – technology and intellectual activities.
Challenges and opportunities for starting business:
Lack of finance
Unestablished customer base – new businesses don’t have loyal and long-term customers
Cash flow problems – businesses run out of money
Opportunities:
Growth – business growths and becomes profitable
Earnings – having entrepreneurial mindset can bring way more earnings than any job could ever
bring
