Solution Manual For
Business in Action, Global Edition, 9th edition Courtland L. Bovee John V.
Thill
Chapter 1-16
DEVELOPING A BUSINESS MINDSET
An introduction to business course offers something to everyone, from
students who are still deciding whether business is the right major for them to
workers who already have practical experience in the business world. This
chapter introduces some fundamental concepts of business, including the
definitions of business, major types of business, as well as the positive and
negative impact of business in society. It also addresses the multiple
environments in which businesses exist and operate. It identifies the main
functional areas of business and explores various careers in the business world
and the key success factors of such careers. Finally, it discusses the seven
components of professionalism.
I. Understanding What Businesses Do
A. A business is a profit-seeking organization that provides goods and
services designed to satisfy customers’ needs
1. A company’s business model is an outline of how the business
intends to generate revenue (money received through the sale of
goods and services)
2. If revenue exceeds expenses, the business makes a profit
B. Businesses add value for customers by transforming lower-value
inputs into higher-value inputs
1. Businesses seek a competitive advantage that makes its products
more appealing than those of its competitors
2. Businesses make decisions involving some risk in anticipation of
receiving future rewards
C. The driving force behind most businesses is the prospect of earning
profits and building assets. Not-for-profit (nonprofit) organizations
such as charities, museums, and most universities do not have a profit
motive. Four helpful ways to categorize businesses are:
1. Product types and ranges
2. Company size
3. Geographic reach
4. Ownership
II. Making the Leap from Buyer to Seller
, A. A business mindset considers decisions to be made and problems to
be overcome before companies can deliver goods/services that satisfy
customers’ needs
B. Businesses contribute to society through:
1. Offering valuable goods and services
2. Providing employment
3. Paying taxes
4. Contributing to national growth, stability, and security
C. Businesses can have negative effects on society such as:
1. Generating pollution and creating waste
2. Creating health and safety risks
3. Disrupting communities
4. Causing financial instability
III. Recognizing the Multiple Environments of Business
A. The social environment consists of trends and forces in society at
large, such as population trends
1. A company is responsible to its stakeholders (all those groups
affected by its activities)
B. The technological environment is comprised of forces resulting from
the practical application of science to innovations, products, and
processes
C. The economic environment encompasses conditions and forces that:
1. Affect the cost and availability of goods, services, and labor
2. Shape the behavior of buyers and sellers
3. Gig economy: portion of the economy composed of people who
work as independent contractors on a series of short-term projects or
tasks
D. The legal and regulatory environment is comprised of laws and
regulations at local, state, national, and international levels
E. The market environment is composed of three important groups:
1. A company’s target customers
2. Buying influences that shape those customers’ behaviors
3. A company’s competitors
Barriers to entry are resources or capabilities a company must have
before it can start competing in a given market.
IV. Identifying the Major Functional Areas in a Business Enterprise
A. Research and development (R&D) is the functional area responsible
for conception and design of products
B. Manufacturing, production, and/or operations—the functional area
charged with producing the goods and/or services of the company. It
includes functions such as purchasing, logistics, and facilities
management
C. Marketing, sales, distribution, and customer support—customer-related
functions that provide customers with the right product at the right
, price and place and then make sure customers have needed support
and information. The advent of social media has put buyers on more
equal footing with sellers
D. Finance and accounting—responsible for all aspects of a firm’s
finances, including financial planning, monitoring, and reporting
E. Human resources—responsible for the recruitment, hiring,
development, and support of employees
F. Business services—other services performed by in-house staff,
external firms, or a combination of the two in areas such as law,
banking, and real estate
V. Exploring Careers in Business
A. Operations Manager/Operations Management: management of the
people and processes involved in creating goods and services
B. Human Resources Specialist: HR specialists and managers plan and
direct personnel-related activities, including recruiting, training and
development, compensation and benefits, employee and labor relations,
and health and safety
C. Information Technology (IT) Manager/IT: the functional area of
business as well as systems responsible for gathering, processing, and
distributing information where needed throughout an organization
D. Marketing Specialist: a wide range of career opportunities in the
interrelated tasks of identifying and understanding market opportunities
and shaping the product, pricing, and communication strategies needed to
pursue those opportunities
E. Sales Professional: professionals responsible for building relationships
with customers and helping them make purchase decisions
F. Accountant: accounting professionals need to have an affinity for
numbers, analytical minds, and attention to detail
G. Financial Manager: financial managers perform a variety of leadership
and strategic functions; unlike accounting tasks, for which there is a long
tradition of outsourcing, the work of financial managers is generally kept
in-house
VI. Achieving Professionalism
A. Professionalism is the quality of performing at a high level and
conducting oneself with purpose and pride
B. Professionalism encompasses seven traits:
1. Striving to excel
2. Being dependable and accountable
3. Being a team player
4. Communicating effectively
5. Demonstrating etiquette: the expected norms of behavior in any
particular situation
6. Communicating effectively:
a. Listen actively
, b. Provide practical information
c. Give facts rather than vague impressions
d. Don’t present opinions as facts
e. Present information in a concise, efficient manner
f. Clarify expectations and responsibilities
g. Offer compelling, persuasive arguments and
recommendations
7. Making ethical decisions
VII.Thriving in the Digital Enterprise: Disruptive Technologies and Digital
Transformation
A. A digital enterprise is any company that uses digital systems as one of
the foundations of its value-creation processes, regardless of what
industry it is in or what product it makes
B. Disruptive innovation: development so fundamentally different and
far reaching that it can create new professions, companies, or even
entire industries while damaging or destroying others
C. Digital transformation: process of reimagining a company’s business
model and operations to become a digital enterprise
1. Big data
2. Internet of Things
3. Cloud computing
4. Social media
5. Mobile apps
6. AI
7. Robotics
8. Robotic process automation
VIII.Developing Skills for Your Career
A. Communication
B. Critical thinking
C. Collaboration
D. Knowledge application and analysis
E. Business ethics and social responsibility
F. Information technology skills
G. Data literacy
Learning Catalytics is a "bring your own device" student engagement,
assessment, and classroom intelligence system. It allows instructors to engage
students in class with real-time diagnostics. Students can use any modern,
web-enabled device (smartphone, tablet, or laptop) to access it. For more
information on using Learning Catalytics in your course, contact your Pearson
Representative.
Business in Action, Global Edition, 9th edition Courtland L. Bovee John V.
Thill
Chapter 1-16
DEVELOPING A BUSINESS MINDSET
An introduction to business course offers something to everyone, from
students who are still deciding whether business is the right major for them to
workers who already have practical experience in the business world. This
chapter introduces some fundamental concepts of business, including the
definitions of business, major types of business, as well as the positive and
negative impact of business in society. It also addresses the multiple
environments in which businesses exist and operate. It identifies the main
functional areas of business and explores various careers in the business world
and the key success factors of such careers. Finally, it discusses the seven
components of professionalism.
I. Understanding What Businesses Do
A. A business is a profit-seeking organization that provides goods and
services designed to satisfy customers’ needs
1. A company’s business model is an outline of how the business
intends to generate revenue (money received through the sale of
goods and services)
2. If revenue exceeds expenses, the business makes a profit
B. Businesses add value for customers by transforming lower-value
inputs into higher-value inputs
1. Businesses seek a competitive advantage that makes its products
more appealing than those of its competitors
2. Businesses make decisions involving some risk in anticipation of
receiving future rewards
C. The driving force behind most businesses is the prospect of earning
profits and building assets. Not-for-profit (nonprofit) organizations
such as charities, museums, and most universities do not have a profit
motive. Four helpful ways to categorize businesses are:
1. Product types and ranges
2. Company size
3. Geographic reach
4. Ownership
II. Making the Leap from Buyer to Seller
, A. A business mindset considers decisions to be made and problems to
be overcome before companies can deliver goods/services that satisfy
customers’ needs
B. Businesses contribute to society through:
1. Offering valuable goods and services
2. Providing employment
3. Paying taxes
4. Contributing to national growth, stability, and security
C. Businesses can have negative effects on society such as:
1. Generating pollution and creating waste
2. Creating health and safety risks
3. Disrupting communities
4. Causing financial instability
III. Recognizing the Multiple Environments of Business
A. The social environment consists of trends and forces in society at
large, such as population trends
1. A company is responsible to its stakeholders (all those groups
affected by its activities)
B. The technological environment is comprised of forces resulting from
the practical application of science to innovations, products, and
processes
C. The economic environment encompasses conditions and forces that:
1. Affect the cost and availability of goods, services, and labor
2. Shape the behavior of buyers and sellers
3. Gig economy: portion of the economy composed of people who
work as independent contractors on a series of short-term projects or
tasks
D. The legal and regulatory environment is comprised of laws and
regulations at local, state, national, and international levels
E. The market environment is composed of three important groups:
1. A company’s target customers
2. Buying influences that shape those customers’ behaviors
3. A company’s competitors
Barriers to entry are resources or capabilities a company must have
before it can start competing in a given market.
IV. Identifying the Major Functional Areas in a Business Enterprise
A. Research and development (R&D) is the functional area responsible
for conception and design of products
B. Manufacturing, production, and/or operations—the functional area
charged with producing the goods and/or services of the company. It
includes functions such as purchasing, logistics, and facilities
management
C. Marketing, sales, distribution, and customer support—customer-related
functions that provide customers with the right product at the right
, price and place and then make sure customers have needed support
and information. The advent of social media has put buyers on more
equal footing with sellers
D. Finance and accounting—responsible for all aspects of a firm’s
finances, including financial planning, monitoring, and reporting
E. Human resources—responsible for the recruitment, hiring,
development, and support of employees
F. Business services—other services performed by in-house staff,
external firms, or a combination of the two in areas such as law,
banking, and real estate
V. Exploring Careers in Business
A. Operations Manager/Operations Management: management of the
people and processes involved in creating goods and services
B. Human Resources Specialist: HR specialists and managers plan and
direct personnel-related activities, including recruiting, training and
development, compensation and benefits, employee and labor relations,
and health and safety
C. Information Technology (IT) Manager/IT: the functional area of
business as well as systems responsible for gathering, processing, and
distributing information where needed throughout an organization
D. Marketing Specialist: a wide range of career opportunities in the
interrelated tasks of identifying and understanding market opportunities
and shaping the product, pricing, and communication strategies needed to
pursue those opportunities
E. Sales Professional: professionals responsible for building relationships
with customers and helping them make purchase decisions
F. Accountant: accounting professionals need to have an affinity for
numbers, analytical minds, and attention to detail
G. Financial Manager: financial managers perform a variety of leadership
and strategic functions; unlike accounting tasks, for which there is a long
tradition of outsourcing, the work of financial managers is generally kept
in-house
VI. Achieving Professionalism
A. Professionalism is the quality of performing at a high level and
conducting oneself with purpose and pride
B. Professionalism encompasses seven traits:
1. Striving to excel
2. Being dependable and accountable
3. Being a team player
4. Communicating effectively
5. Demonstrating etiquette: the expected norms of behavior in any
particular situation
6. Communicating effectively:
a. Listen actively
, b. Provide practical information
c. Give facts rather than vague impressions
d. Don’t present opinions as facts
e. Present information in a concise, efficient manner
f. Clarify expectations and responsibilities
g. Offer compelling, persuasive arguments and
recommendations
7. Making ethical decisions
VII.Thriving in the Digital Enterprise: Disruptive Technologies and Digital
Transformation
A. A digital enterprise is any company that uses digital systems as one of
the foundations of its value-creation processes, regardless of what
industry it is in or what product it makes
B. Disruptive innovation: development so fundamentally different and
far reaching that it can create new professions, companies, or even
entire industries while damaging or destroying others
C. Digital transformation: process of reimagining a company’s business
model and operations to become a digital enterprise
1. Big data
2. Internet of Things
3. Cloud computing
4. Social media
5. Mobile apps
6. AI
7. Robotics
8. Robotic process automation
VIII.Developing Skills for Your Career
A. Communication
B. Critical thinking
C. Collaboration
D. Knowledge application and analysis
E. Business ethics and social responsibility
F. Information technology skills
G. Data literacy
Learning Catalytics is a "bring your own device" student engagement,
assessment, and classroom intelligence system. It allows instructors to engage
students in class with real-time diagnostics. Students can use any modern,
web-enabled device (smartphone, tablet, or laptop) to access it. For more
information on using Learning Catalytics in your course, contact your Pearson
Representative.
