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Accounting is the systematic and detailed recording of business transactions. These business transactions are used to track who owns what, where money came from and where it went, how much profit was made, and so on. The goal of accounting is to turn a pile of data into useful information that managers can use to run their businesses more efficiently. Accounting consists of two broad areas: financial accounting which deals with matters involving the company's finances (e.g., tracking profits, losses, assets) and management accounting which deals with matters involving internal operations (e.g., production levels).
Biography books focus on individuals' life and their achievements in the field of business. They are often written in chronological order, detailing key events throughout their career. Many business biographies contain sections that focus on the author's life outside their company. They are often written by an individual who has previously worked with the CEO or other members of staff, giving insight into how they managed to succeed in business. We can also learn about morality through reading business biographies, as many individuals became very wealthy through hard work and perseverance; however, there are others that became rich due to corrupt practices or illegal activity.
Business culture is the set of values and practices that an organization holds and uses to achieve its objectives, such as increasing profit. It includes the attitude of employees towards their work and towards standards of behavior; how they treat each other; how everyone in the organization interacts, as well as with those outside the company. The many aspects of business culture include: 1) how companies communicate (how often, what methods); 2) work ethic (hours worked per day/week, etc.); 3) employee treatment (hiring process, training, advancement); 4) decision making (who makes decisions and who is consulted).
In broad terms, Business Development consists of maximizing the value of a company's existing businesses through organic growth and M&A while minimizing risk. Entrepreneurship is about taking the initiative to launch new products or services within an existing business, or a spin-off from a current core operation. While the terms are often used interchangeably, there is a subtle difference between Business Development and Entrepreneurship. This distinction is important to understand when considering entrepreneurship as part of your path towards becoming an investor - if you want to end up on the buy-side managing money for institutional investors, you likely will need some experience in business development. However, if you intend to start or join a start-up one day, you will ideally have at least some entrepreneurship experience under your belt. Founders are expected to be pragmatists capable of driving their businesses forward through any challenge.
Economics is defined as a social science that studies the production, distribution, and consumption of goods and services. It analyzes how individuals, businesses, governments and nations make choices on allocating resources to satisfy their wants and needs, or what to produce, how to produce it, and how much to produce. Economics also deals with the study of how society manages its scarce resources. Economics focuses on flows of money in an economy. This means that income and expenses are studied, along with their effects on the financial position of firms or individuals. The word 'economics' originates from the Greek language: oikos means "house" or "home"; nomos means "regulating". The term was first used by the French economist Jean-Baptiste Say (1767–1832) who saw it as one of three divisions of society (the others being politics and legislation).
Finance is the study and management of assets and liabilities over time under conditions of different degrees of uncertainty and risk. The concept arose in the wake of the industrial revolution as carrying on business increasingly came to rely on using funds borrowed from outside sources. Finance can be divided into three sub-categories: public finance, corporate finance and personal finance. Public finance deals with government borrowing and spending, while corporate finance deals with the borrowing and spending associated with running a corporation. Personal finance concerns household borrowing & spending money, usually by individuals or families. The distinction between the three sub-categories is arbitrary, as each one involves a large amount of interconnectedness with various other parts of financial theory. For example, personal finance may involve choosing a mortgage loan which makes use of both public and private borrowing and as well as building on ideas from corporate finance.
In a nutshell, HR simply means "people management" and it's now considered as one of the key business functions. However, it used to be called personnel management or industrial relations. People working in HR can vary from strategic business partners to transactional administrative staff. Some will simply manage the recruitment process for a company by checking CVs and placing job advertisements, others may carry out psychometric assessments or conduct interviews, but generally they'll want to attract top talent into an organisation. Another part of what HR professionals do is make sure all employees are treated fairly and equally under the law – this will include salaries, maternity/paternity policies, overtime payments etc.
An industry is a group of companies and organizations that operate in similar kinds of business activity, serving similar kinds of customers using similar kinds of products and services and having comparable corporate forms. The defining characteristics of an industry are mostly related to the products or services it provides and the markets it sells those products to. Industries can be classified as product or service based, depending on how they make money (for example, a tobacco company produces and distributes cigarettes that people pay for; a media organization makes money by selling advertising space). Industries that offer some sort of service, such as education, health care and financial services, tend to be organized along multi-faceted professional lines and rely on large networks of skilled employees. On the other hand, industries whose primary business is making something tangible, such as cars or clothes, tend to be more centralized around large factories with mass production systems supported by low paid employees. Industries can also be classified in terms of the size and location of their markets: local, national, regional and global. Markets serving a larger geographic area tend to have greater economies of scale – which explains why companies in a global industry typically locate in large population centers near major marketplaces where there is a strong customer base from which they can draw customers and where they can connect to suppliers, distributors and other partners. Local companies usually have lower revenues but also tend to have higher costs because of the smaller volume of services or goods they produce.
Insurance is a form of risk management primarily through transfer of risks from one entity to another. This is done through use of financial instruments where payments made under the contract by each party entail that, in effect, some or all of the losses due to an event of default are borne by the other party. It includes traditional insurance as well as reinsurance and insurance exchange systems like Lloyd's (insurance), London market (risk transfer), Munich Re (reinsurance). Insurance companies distribute risk by selling policies, which describe the risks that they will cover and the terms on which the insurance contract is offered. The policy typically describes what is insured, how much it costs (the premium), and when and under what circumstances payment and benefits will be provided. It may also spell out who receives coverage for injuries suffered by others within a home or business, including guests at hotels or sports venues. Many jurisdictions regulate insurance contracts through laws and regulations aimed at preventing frauds like contract misrepresentation or non-disclosure of material facts (misstatement, omission).
Investing is the process of using money with the intention to make more money. For example, if you buy a bond (an IOU from a government or company) and hold onto it until it matures, then you can get your initial investment back, plus some extra money. This is an example of investing: you expect to use the same money and get more back in return. A stock is a share of ownership in a public company; when you own one share of Apple's stock, you own one tiny piece of all of Apple's stuff! In general, when people invest in stocks, they're hoping that the price will rise — that is, that they'll be able to sell their shares for more than what they paid for them. When you buy a house, you might fix it up and then sell it later for more money than what you paid. That's real estate investing – buying properties with the expectation that they will appreciate in value over time so that you can resell them for a profit.
Management is the act of organizing, planning, securing, leading or directing people toward goals. Leadership is the process of influencing people in a way that motivates and inspires them to accomplish certain goals. A leader creates an environment where others respond by willingly doing what needs to be done without being told. Leadership happens in many different contexts and can occur within groups, teams, or whole organizations. Different types of management styles are typically associated with different leadership styles. For example, autocratic leaders often use coercive forms of influence while democratic leaders focus on collaboration and opportunities for others to participate in decision-making processes. Transformational leaders create environments that facilitate change, whereas transactional leaders motivate people by establishing rewards and punishments based on meeting or not meeting expectations.
Marketing and sales activity has always been a part of business, but it wasn't until after World War II that marketing became a discipline within the context of being a separate function from advertising. Over time, marketing's key activities have remained essentially unchanged: 1) Setting the strategic direction for the development and delivery of products/services; 2) Identifying customer needs and delivering compelling value proposition; 3) Understanding the trade-offs between price, quality, service levels and product features in meeting customers' needs or expectations; 4) Providing guidance on where to compete (geography/industry) and when to compete (segments) by assessing capital requirements & return on investment. Marketing needs to ensure that any new product introduction align with company's overall strategic objectives. The marketing mix has become widely used as a tool for business managers, marketers and strategists to understand how different combinations of product/service features (e.g., quality) and price levels (value) can create unique competitive advantages that differentiate the offering from competitors' products or services. Over time, salespeople grew their influence within organizations; however, sales teams were presented with challenges in leveraging market knowledge beyond direct selling opportunities. As a result, sales managers began outsourcing these needs by partnering with consultancies like A.T. Kearney & McKinsey who pioneered many of today's standard practice.
The Real Estate Industry comprises several sub-industries, including new homes construction, apartment rental and development, commercial space leasing, property brokerage services (both commercial and residential), property management services (for both commercial and residential properties), real estate investment trusts (REITs), land use planning, appraisal of real estate assets for purchase or sale purposes (a function performed by members of many established professions) as well as many more lesser known industries. According to the United States Bureau of Labor Statistics, there are six major roles in the real estate industry: 1) Realtor; 2) Property manager; 3) Mortgage brokerage; 4) Development company; 5) Commercial broker; 6) Landlord. The Bureau also reports that in 2010, there were about 1.8 million people employed in the real estate industry, with average hourly earnings of about $31 an hour or around $64,000 a year.
Taxation is the system of laws and rules governing the collection of a direct or indirect payment from an individual by a state as ordered by a legislature. In classical political theory, taxation was akin to slavery as only those who were wealthy were able to pay taxes. The Ancient Roman Empire used taxation as a way to fund its military campaigns, which allowed it to conquer nearly half of Europe. In modern times, taxation has been used for many purposes including regulation of any activity that might have negative externalities that might be under priced if left solely up to a free market economy. The positive effects of taxation include creating a social safety net, stabilizing the macroeconomic fluctuations in business cycle activity associated with recessions and depressions, reducing income inequality, funding public goods such as infrastructure development and scientific research, the enforcement of property rights and increasing the likelihood of economic growth by providing incentives to innovate and work. Taxation is used by central governments to redistribute wealth from the rich to the poor, in order to provide universal public services like healthcare and education. Taxation can take many forms, but there are essentially two main types: direct and indirect. Direct taxes are levied directly from individuals or companies on the basis of their incomes or profits. Indirect taxes are levied on transactions such as VAT (value-added-tax) which is added to the cost of goods and services at each stage of production and distribution.
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