Transcript Introduction to Business - Glendale Community College

BSUAD-101
Poorna Pal, MS MBA Ph.D.
Professor of Geology & Business
#7516: Th
& Coordinator: Program Review
23
6-9 PM,
Glendale Community College
Office: SG-152, Ph. Ext 5517
CR-137)
E-mail: [email protected]
(Introduction
to Business)
is a 3-units
introductory course surveying the functions,
characteristics, organization, and problems
of business.
Transfer credit: CSU,UC,USC
In this “Information Age” the U.S. is increasingly
becoming a service
Service Providing Jobs
1. Trade, Transportation 5. Education and
economy. Note that
and Utilities
Health Services
2.
3.
4.
all additional jobs in U.S.
since 1970 have been
created in economy’s service
providing segment; and
most of them are nongovernmental jobs.
a
Information
Financial Activities
Professional and
Business Services
6.
7.
8.
a
Goods
Producing
Jobs
b
8
a.
c
7
b.
c.
b
8
6
7
Goods
producing
Service
Providing
1970
5
Total
4
Employed:
3 2
71 million
1
Service
Providing
c
6
5
3
1
Leisure and
Hospitality
Other Services
Government
4
2
Natural
Resources
and Mining
Construction
Manufacturing
2007
Total
Employed:
137.6 million
Data source: Bureau of Labor Statistics: ftp://ftp.bls.gov/pub/suppl/empsit.ceseeb1.txt
We are mostly
a service
economy and
most of our
jobs are in the
private sector.
2007:
22.2 million goods
producing jobs
3% Natural
resources &
Mining
= 115.40 million service providing
(= 115.42 million private + 22.2 million
government ) + 22.2 million goods
producing jobs
2007: 115.4 million service
providing jobs
19%
Government
5% Other
services
34%
Construction
63%
Manufacturing
2007: 137.6 million total
non-farm employment
12% Leisure
and hospitality
22% transportation
& utilities
3% Information
7% Financial activities
16% Professional
16% Education
& health services
& business services
ftp://ftp.bls.gov/pub/suppl/empsit.ceseeb1.txt
That our labor-force is well-educated (by 2007, almost
one in three had Bachelor’s degree or better) reflects
this and the fact that employability rises with
educational attainment.
Employment status of the
civilian non-institutional
population 25 years and over
by educational attainment
High
Some College,
Bachelor's
School
with or without
Degree or
Diploma or the Associate
Higher
Equivalent
Degree
26.63
61.37
49.83
56.62
13.70%
31.56%
25.63%
29.12%
Number in millions
12.41
38.54
35.89
44.07
Relative to total
labor force
9.48%
29.44%
27.42%
33.66%
Numbers employed (million)
11.52
36.86
34.61
43.18
Employment-population ratio
43.30%
60.10%
69.50%
76.30%
Unemployment rate
7.10%
4.40%
3.60%
2.00%
Civilian noninstitutional
population
Civilian labor
force
Number in millions
< High
School
Diploma
Fraction of total
population
Datasource:
source:Bureau
Bureau
Labor
Statistics
(ftp://ftp.bls.gov/pub/special.requests/lf/aat7.txt)
Data
of of
Labor
Statistics
(ftp://ftp.bls.gov/pub/special.requests/lf/aat7.txt)
Most of this employment growth has
been in the economy’s small business
sector. And small business owners are
hardly an uneducated lot!
19%
Graduate
School
24%
Bachelor’s
Degree
4% Not reported
24% High
School or
less
28% Some
College
Source: U.S. Census Bureau “Survey of Small Business Owners (SBO): Owner’s Education Levels at StartUp, Purchase, or Acquisition of the Business” (http://www.census.gov/csd/sbo/edu.html)
The aging of our population too poses a
problem. Demographics define …
70%
16-64 years
(left scale)
14%
65%
12%
60%
10%
65-plus years
(right scale)
55%
6%
50%
1940
8%
1950
1960
1970
1980
1990
2000
Data source: 2008 Economic Report of the President http://www.gpoaccess.gov/eop/2008/B34.xls
Proportion of Total Population
Proportion of Total Population
the kinds of goods and services that are needed, and
the kinds of goods producers and service providers
we can have.
2003 World Population
= 6,651 million
12% SubSaharan Africa
6% South America
1% Oceania
5% North America
7% North Africa &
Middle East
11% Europe
3% Central America
& Caribbean
Compared to the 15-65 years old “working
population”,
55% Asia
• Europe, North America and Oceania have
(excluding
too many elderly (>65 years old), whereas
Middle East)
• Central America & Caribbean, Middle East
& North Africa, South America and SubSaharan Africa have too many children
(<15 years old).
2003 World Population Data
http://earthtrends.wri.org/
Asia (excluding Middle East)
Central America & Caribbean
Europe
Middle East & North Africa
North America
Oceania
South America
Sub-Saharan Africa
World
Demographics explain
the Asian resurgence
Total
population
(million)
3566.68
180.32
730.06
427.38
325.60
32.47
363.84
732.68
<15 yrs
27.94%
32.77%
16.40%
35.04%
20.73%
24.85%
29.85%
42.95%
15-65 yrs
65.73%
61.81%
68.15%
60.63%
66.97%
65.38%
64.01%
54.04%
>65 yrs
6.32%
5.42%
15.45%
4.33%
12.30%
9.76%
6.14%
3.01%
6359.03
28.68%
64.17%
7.14%
Population, by age
60%
40%
20%
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
0%
1992
The 1992 start-ups still alive
Small businesses have high failure*
rates. For instance, these Census
Bureau data show that only
100%
29% of the 1992 start-ups
still existed in 2002!
80%
________________
* “Failure” here
encompasses all
forms of failure to
continue including
insolvency, abandonment, sickness, death,
closure, sale of
business, loss of
lease, acts of god
etc etc.
Scott Shane: “Illusions of Entrepreneurship: The Costly Myths that Entrepreneurs, Investors, and Policy Makers Live By “ (Yale University Press, 2008)
The confluence of four factors
today supports and expands the
entrepreneurial opportunities:
Demographics
Education
Globalization and
Information Technology
The Rise of China, India & Russia: The Next American Century
seeprogress
Indian Call Center -1 05:56 From: suprabhathalder
Advances in Information
Technology have aided Trade,
Commerce and Globalization,
e.g., …
Electronic transactions
and E-Commerce
Outsourcing
Play now May 26, 2007
video.yahoo.com
Your entrepreneurial effort is likely to succeed
if you start it for the following reasons:
You have a passion and love for what you'll be doing, and
strongly believe ― based on educated study and investigation ―
that your product or service would fulfill a real need in the
marketplace.
You are physically fit and possess the needed mental stamina to
withstand potential challenges. Less-than-robust health has often
been responsible for bankruptcies.
You have drive, determination, patience and a positive attitude.
When others throw in the towel, you are more determined than
ever.
Failure doesn’t defeat you. It is a "learning process" if you learn
from your mistakes, and use these lessons to succeed the next
time around. Studies of successful business owners showed they
attributed much of their success to "building on earlier failures“.
You thrive on independence, and are skilled at taking charge
when a creative or intelligent solution is needed. This is
especially important when under strict time constraints.
You like ― if not love ― your fellow man, and show this in your
honesty, integrity, and interactions with others. You get along
with and can deal with all different types of individuals.
Source: “The Seven Pitfalls of Business Failure and How to Avoid Them” by
Patricia Schaefer (http://www.businessknowhow.com/startup/businessfailure.htm accessed on 8/30/08)
A private enterprise system rewards the firm/business for
its ability to identify and serve the needs and demands of its
customers, and therefore operates in the framework of four
basic rights:
Right to private property: Every
participant has the right to own,
use, buy, sell, and/or bequeath
most forms of property.
Private
Right to profit: Every firm/
Property
business has the right to
all profits, after taxes,
it earns through its
operations/activities.
Right of free choice:
Every participant in the
system has the freedom of
choice (with regard to jobs,
Profits
purchases, and investments)
Right to compete: Every participant has the right to compete
freely and fairly in the marketplace.
Competition
Rights
Freedom
of Choice
Why public policy needs strategies to
promote small/medium-sized enterprises
(SME)?
The growth of a vibrant, thriving, highly productive
and profitable SME sector is crucial for sustaining
our living standards. It creates an abundance of job
and investment opportunities.
Appropriate public policies must be therefore
designed to remove barriers to SME’s growth and to
offer adequate incentives to foster their development.
We need to continually examine if the entrepreneurs
and managers at SMEs and their financiers are doing
all they can to address the growth challenges.
Rapidly changes in the international regulatory
environment require that SMEs understand their
implications.
Adapted from Path to Prosperity
http://www.cme-mec.ca/national/documents/sme_final.pdf