VOCABULARY
management , , ,
a management level
a management structure
a management style
to be responsible for
a flow of information
to forecast
autocratic
to set objective
to take into consideration
influence
to influence
labour productivity
experience
in the focus of attention
environment
an approach
to approach
an innovation
judgment , ;
skills
maturity
adaptability ,
assertiveness
a suggestion ,
a limit
to limit
Management means the members of administration of a business or an organisation. They may be or may be not the owners of the business. But they are always selected by the owners to be responsible for different functions of the organisation. A typical organisation has three layers of management: the senior management, the middle management and the junior management.
Heads of major departments within the organisation make the senior level. Leaders of sections make the middle management level. The junior management level provides a link with the rest of the workforce.
The word "management" has also another meaning. F. Pitt and V. Baker in "Management and Information" define it as "the making of decisions on the allocation of resources".
The common essential of all management activity is the flow of information. That is, the inward flow of data on which decisions can be based and the outward flow of the decisions.
A good definition of a manager is given by W. Brown and E. Jaques. A manager is "an individual who is accountable for more work than he/she can do themselves and who gets some of it done through other people". This definition is related to managers who function at all levels. The main functions of a manager are:
1. to forecast and plan (seeing into the future and drawing up plans of action);
2. to organise (to put plans into operation);
3. to command (to get the best performance from the staff);
4. to co ordinate (to make it sure that each department's efforts harmonise with those of other departments);
5. to control (to see that everything works according to plan). Traditionally, there are the two styles of management autocratic and democratic. Let us consider them.
Autocratic managers set objective for the group demonstrating their power and authority. They give orders and expect group members to obey them without any question. It is clear that in such situations group members do not make their own decisions.
Democratic managers, on the contrary, let group members set their own objectives. If they give orders they explain why and give reasons for their orders. Group members take part in decision making, they express different points of view. What is more, democratic managers take into consideration all their opinions before making a final decision. They also demonstrate the fact that the opinions of group members influence a final decision.
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Researches show that the democratic style of management is much more effective. It leads to higher labour productivity, feelings of involvement into business and job satisfaction.
Of course, the autocratic management style can also achieve high productivity. However, researches show that such group members experience conflicts with management more often. They also show dissatisfaction with their work more often.
What modern researches also showed is that managers adopt more than one style in different situations.
So, how do management styles vary?
Let us consider the following table:
High Tells manager makes decision and informs the group
Sells manager makes decision and explains it to the group
Consults manager listens to suggestions, then makes decision
Shares manager defines limits and lets the group make decision
Low Delegates manager allows group members to operate within defined limits
5. ADVERTISING
VOCABULARY
a billboard board on which advertisements are posted
a circular letter or notice distributed among people for business purposes
skywriting writing in the sky by an aircraft
copy ad text
a form letter standardised printed letter
space advertising advertising on large areas
a booklet very small and thin book
a give away something given free to attract customers
effective good, producing some effect, result
to induce cause, influence
to hold interest keep interest
In business they spend billions on advertising. Products and services are advertised through mass media including radio broadcasts, television, newspapers and magazines. They are also advertised through billboards, handbills, circulars, skywriting, through space advertising, booklets, give-aways and so on.
In small business they prepare their own copy and give it to newspapers, as a rule, or they mail circulars or form letters all by themselves.
In big business, however, they employ the whole army of specialists in the field of advertising. They work out advertising programmes, provide means for advertising purposes, discuss and solve many advertising problems with the owner or management of a company. As a rule, they advertise to sell their products and services through various advertising mass media. Today there are many types of advertising. We can classify the most popular of them:
1) television advertising;
2) radio advertising;
3) space advertising (newspapers, periodicals, house walls);
4) stores advertising (including special departments);
5) mail advertising (letters, calendars, catalogues, circulars, booklets, giveaways);
6) position advertising (street car, train, bus, window cards, billboards).
What is an effective advertisement? It is one that attracts your attention. It is such an advertisement which keeps an honest information about a product or a service. It often has a clever and interesting picture or drawing, skilful use of colours. It is also put in the right place.
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Apart from attracting your attention a good advertisement must hold your interest. What is more, a really effective advertisement induces action. You simply go and buy this very product. In a word, a good advertisement sells the product or the service.
6. BANKS
VOCABULARY
savings-bank
savings
a source
a source of credit
a depositor ,
a depositary
a withdrawal
a commercial bank
a loan
a letter of credit (L/C)
a trust ,
a goldsmith
an interest
interest-free
to select
a selection ,
integrity ;
to take into consideration
an offer
to offer ,
a rate
reasonable ,
confidence
to require
a requirement
a connection '
an insurance
activities
indebtedness
an amount
expenses
in regard to
proof ,
future prospects
a foreign exchange currency
to give notice
the Middle Ages
middle
a choice
BANKS
There are different banks. They may be classified according to different services they perform.
Savings banks. These are institutions which accumulate savings in small accounts. They are also valuable sources of credit for businesses. Savings banks, as a rule, invest their funds in long-term credit instruments. That is why, most savings banks require their depositors to give notice before a withdrawal.
Commercial banks. In most countries commercial banks serve as a depository of funds and a source of credit. Today they are active in giving short-term loans to business.
Commercial banks also deal in foreign exchange and letters of credit.
Investment banks. They do not accept checking deposits. They promote industry through the sale of large issues of stocks to investors.
Trust companies are such financial institutions which administer funds or property for the benefit of others. They serve as trustees for property or guardians of minors, or agents for stocks. In a word, they manage business in the interests of others.
The banking system of modern times is very complex.
If we go back as far as the Middle Ages we can find some banking practices too.
The goldsmiths made fine things out of gold and silver. They kept those precious things in strong-boxes. Soon some people began to come to them to entrust money to the goldsmiths. Later on some goldsmiths found themselves in possession of large sums of money. Some of goldsmiths didn't want to keep money idle. They began to lend it at interest. At the same time the goldsmiths kept some part of money to meet possible withdrawals. It was an early step in the development of banks.
Questions to Text A:
1. What are the main types of banks?
2. What are their functions?
3. What is the origin of banks?
SELECTING A BANK
The most important thing in the choice of a bank is its integrity. The size and the type of the bank must be taken into consideration too.
If you are going into business, there is an advantage for a small business to place an account in a small bank. The staff of such a bank know each customer and can estimate your business better.
However, there are the advantages of a larger bank. It is true, that dealings with a large bank are more impersonal. But, it is also true, that a large bank can offer more facilities. Large banks can make a loan at more favourable interest rate. They also can make as large a loan as it is desired.
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In any case, selecting a bank people learn as much information about the reputation of a bank as possible.
As a summary, therefore, the following six guides are suggested.
1. Choose a bank whose officers possess character, leadership, and the willingness to assume a risk provided, there is a reasonable chance of repayment.
2. Choose a progressive bank one whose officers are alert to current industrial trends and are willing to make loans for new products and more efficient processes.
3. Choose a bank that stresses an attitude of friendliness to a small business.
4. Choose a bank that has confidence in the future of your community and thus is willing to invest in it.
5. Choose a bank that quotes reasonable interest rates.
6. Choose a bank that gives good service.
Requirements for Obtaining a Loan
When making a loan for some business most banks want additional information. The complete list of such information is given below. It includes the business ability of a borrower, his past experience, his chances of success in the future, the need and purpose of the loan, etc. There are some items:
1. Proper identification.
2. Nature of business.
3. How the business is organised, its ownership, and any special agreements.
4. Personal data on all principal owners as to age, connection with the business, connection with other businesses, life insurance, banking connections, and civic activities.
7. EXCHANGES
VOCABULARY
an exchange ;
a stock exchange
a commodity exchange
a labour exchange
a rate of exchange
an exchange business
a rule
a broker
securities
a bond
a council
a trading floor
a fixed rate
an ordinary share ,
an installment
an exchange trade
a penny ,
a preference ,
a preference share
a fixed income
to go bankrupt
in full ,
a deal ;
to deal ; ; ;
to deal-out
unlisted securities
to be listed
restructure
gilts (Gilt-Edged Securities = gilts)
a stock market
a redemption date
a fund , ,
funds
to fund money
to refund money
spending
I
What is an exchange? It is an organised meeting of people in an appointed place to buy and sell. Certain rules govern the trading there and the members of exchange are called brokers.
There are the two types of exchanges known as the commodity exchange and the stock exchange.
Commodity exchanges were established with the aim of trading cotton, wool, timber, wheat, skins and many other commodities. Among well-known commodity exchanges are the Board of Trade in Chicago trading corn, the New York Coffee and Sugar Exchange. The world-known is British Metal Exchange trading metal, the Wool Exchange trading wool, Hatton Garden trading diamonds, Beaver House trading furs. The Baltic Exchange is a large grain market. In Japan there is the Tokyo Commodity Exchange for Industry.
Stock exchanges are such places where securities, stocks and bonds are sold and bought. It should be noted that the fluctuation of prices on exchanges influences the prices of various commodities on the world market.
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The business of buying and selling on stock exchanges is called dealing, while a transaction is called a deal. The most famous stock exchanges are the New York Stock Exchange, the Royal Exchange in London, the Tokyo Stock Exchange, the Osaka Securities Exchange, the Australian Stock Exchange, the Sydney Futures Exchange and others.
The governing body of a stock exchange is, as a rule, the Council, which is elected by the members. A large stock exchange has the main trading floor in some large city and some other cities and towns. Say, the stock exchanges of the United Kingdom and the Irish Republic amalgamated in 1973. Since that time it is known as "The Stock Exchange". The main trading floor and central administration of it is in London, however, there are trading floors in Glasgow, Liverpool, Manchester, Birmingham, Dublin and Belfast.
II
Before you invest in the stock market, you need to know the meaning of a few basic terms. Let us consider them. What is a stock? The term "stock" means stock market holdings which pay a fixed rate of interest. But in day-to-day dealings, the words stocks, shares, equities and securities mean pretty much the same thing.
Ordinary shares. If you invest in the stock market, you will almost always be dealing with what are known as ordinary shares. You may come across some other types of shares. These include the following:
Partly-paid shares. Companies may issue partly-paid shares, which allow you to pay for the shares in installments. You can only sell partly-paid shares if all of the installments are up to date. If you miss an installment, you will lose your shares and any money you have already paid.
Penny shares. These are shares which have a low price. They usually cost less than 15 pence each. They can be very risky investments, but if the price rises you may make a great deal of money.
Preference shares. These shares earn a fixed income. You will receive any dividends before the people who hold ordinary shares in the same company. If a company becomes bankrupt, preference shareholders are paid first, after all the creditors have been paid in full.
Unlisted securities. Companies which are not big enough to be listed on the Stock Exchange, or which do not want to pay to be listed, can be sold on the Unlisted Securities Market (USM). The Stock Exchange restructured the USMinthemid 1990s.
Gilts. Gilts, or Gilt-Edged Securities, are securities issued by the British government which have a fixed rate of interest (usually for a set term) and are sold on the stock market. The money that they raise helps to fund government spending. They can be:
♦ longs, with a redemption date (date when the government pays back the money) more than fifteen years away;
♦ mediums, with a redemption date between five and fifteen years away;
♦ shorts, with a redemption date of five years away or less.
8. BUSINESS
VOCABULARY
to own
a partnership ,
a corporation
trade
production
distribution
a profit
a market
a works
an exchange
an aim (= , goal)
expenses
regulations
an agreement
a stock certificate (or share)
a stockholder
governmental
receipts
statistical data
to account for
BUSINESS
The word "business" is used in many modern languages. In ancient times it meant trade for things people wanted. Nowadays business is production, distribution and sale of goods or services to get some profit.
Production is, as a matter of fact, making things, producing goods and creating services.
Distribution is moving things from the place of production (works or factory) to the market-place.
As for the sale of goods and services, it is the exchange of a product or service for money.
In any business activity making a profit is the major aim. Profit is defined as the money that remains after paying all the expenses in business.
FORMS OF BUSINESS
In most countries there are three forms of business. They are the sole proprietorship, the partnership and the corporation.
The sole proprietorship means to go into business for oneself. Everybody has the right to do it. All you need is ideas about the business, some capital to begin with and knowledge of regulations of this business.
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The partnership is an association of two or more people involved in business. In partnership it is important to have a written partnership agreement.
The corporation is the so-called "a legal person", an institution to make a profit. Those, who operate a corporation have stock certificates. The individuals who own such stock certificates (or shares) are called stock-holders. As a matter of fact, there are privately own business corporations and governmental ones.
Questions
1. What was the definition of business in ancient times?
2. What is the modern definition of business?
3. What does production in business mean?
4. What do we mean under distribution in business?
5. What does sale of goods and services mean in business?
6. Can you give the definition of profit?
9. STATISTICS
VOCABULARY
a phenomenon
to describe
to deal with ',
numerical
numerical data
numeral ,
a state ,
accounting
Antique World
ancient
ancient times
quality
quantity
qualitative
quantitative
to consist of
several
to divide
a branch ,
to consider
analysis
to work out
working out
an index ,
an indicator
calculation ,
standards of life
a level
a consumption
population
development , ,
CONFEST
constantly
to repeat
space ,
in the course of time
The role of statistics is hard to overestimate. As soon as a state is formed people begin to pay attention to the quantitative side of many social things. The more developed a society is, the more important role statistics plays in its life.
The word statistics comes from the Latin word "status" which means the state of things. The synonym of the state of things is a number of facts about certain social and economic phenomena and processes. They also describe statistics as. a science which deals with,mass numerical data.
Historically, statistics development starts with the formation of a state. One can find some traces of statistics and accounting" in documents of the most developed countries of the Antique World.
One should remember that statistics, first of all, deals with the so-called quantitative side of things. However, the quantitative side is closely connected with the qualitative side of things.
Statistics consists of several sections. They are independent and at the same time these sections are closely connected with each other. At present time they divide statistics into four main parts. They are:
♦ statistics theory;
♦ economic statistics;
♦ branch statistics;
♦ social statistics.
Let us consider these parts in short.
Statistics theory deals with the categories of this science, methods and means of analysis.
Economic statistics deals with phenomena and processes that are taking place in an economy. It works out the whole system of economic indices and methods of study of an economy of a country or of a region.
Branch statistics may be subdivided into industrial, agricultural, finance, social infrastructure, trade, banking, state budget and so on.
Each branch statistics works out the methods of calculation of indicators that show specific features of each branch taken separately.
Social statistics deals with social conditions and character of labour, standards of life, levels of profit and income, consumption of products and services by population. During all the time statistics as a science is developing side by side with the development of other theoretical sciences dealing with society.
Another no less important feature of statistics is that it studies the mass character of social phenomena. It means that statistics is constantly dealing with such phenomena which are repeating themselves and are changing in space and in the course of time.
10. MARKETING
VOCABULARY
a producer
a consumer
distribution ,
marketing ; ;
storage
a price
promotion
promotion of goods (products)
an exchange
needs, wants, demand
a need
to recognise a trend
marketing mix
advertising of goods
complex
likings
searching of market
introduction
to rise (prices)
to fall (prices)
Marketing is an activity that includes different kinds of business dealings with the movement of goods and services from producer to consumer. It surrounds our everyday life. Marketing is a very complex process. It includes such activities as product planning, storage, buying, pricing, promotion, selling, traffic, distribution of ideas and research. What is Marketing? Marketing experts and scientists working in this field, more often disagree with the definition of Marketing. Let us consider here the two definitions given by the two well-known specialists in this field.
Philip Kotler: "Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others."
Peter Drucker: "Marketing is the performance of business activities that direct the flow of goods and services from producer to consumer."
"The aim of marketing is to know and understand the customers so well that the product or service fits him and sells itself."
The ability to know some new wants and demands of customers, to recognise new trends and developments is very important in marketing Those who produce must know what goods and services, where, for what prices, why, for what purpose their customers would like to buy. Marketing research in this respect helps producers very much. The ABC of marketing is the so-called Marketing Mix. It includes the Four P's: product, price, place and promotion. Place means the location of certain goods and services as well as distribution of them. Promotion includes all kinds of communication in marketing, say, advertising, sales, direct mail, free additions, testers, fairs and shows to advertise new products and services, telemarketing with telephone sales, newspaper ads, etc. Promotion is considered to be, perhaps, the most complex element in the Four P's. It should be kept in mind that different groups and sections of people have different likings and dislikings. You have to take it into account making all goods and services appeal to different customers. The third element in Marketing Mix is Product (Service). It is often connected with research and development of a new product or service, testing it to know for quality, searching the potential markets and, after all, introduction to the market. Each product has its own "product life cycle". These cycles are different for different products, however, there are 4 stages of life cycle for each product. They are: introduction, growth, maturity and decline. It should be noted that Product is the most controllable of the four elements of Marketing Mix.
The most changeable element of all the four is Price. The definition of price is exchange of something of value for something else. It is as simple as that. And it is very important for customers. As prices rise we can buy fewer things or only things of lesser quality. On the contrary, as prices fall customers can buy more things or things of better quality.
