Anatomy of a Business: What It Is, What It Does, and How It Works

A reference book for business novices (high school and undergraduate college students) who want to learn about the basics (and have a good laugh at the same time).

From the birth of international trade along the exotic Silk Road, to the economics of running a lemonade stand or a day in the life of a corporate executive, traces the evolution of modern business practices and how they are applied in enterprises of all kinds. In her first book, which was released by Greenwood Press in 2007, Dr. Sasha Galbraith uses humor and the straight facts to inform, educate and empower those considering a career in business. A multitude of charts and illustrations, as well as an extensive glossary and easy-to-navigate chapters, help answer a number of questions that students ponder, but never want to ask. With quick wit and a touch of attitude, Galbraith uses the book to explain a number of popular theories, approaches to management and contemporary issues. She also presents tales from chief operating officers, executives and company presidents about what their professions entail and how their days unfold. It is a wonderful resource for students, entry-level employees and human resources departments seeking to help guide people’s career choices.

TABLE OF CONTENTS

Title page
Copyright Acknowledgements
Dedication
List of Figures and Charts
Preface
Abbreviations
OVERVIEW/INTRODUCTION
- WHAT IS BUSINESS?
- HISTORY OF BUSINESS
- BUSINESS AS TRADE
  - The Barter System
  - The Have’s and Have-nots: Natural Resources and Where’s the Beef?
  - Early Traders
  - The Silk Road
  - Trader as Raider
  - Colonialism – The Sun Never Sets on the British (French, Portuguese, Spanish) Empire
  - The First Corporation
  - BUSINESS AS COMMUNICATION
  - Pony Express
  - BUSINESS AS ECONOMIC DEVELOPMENT
- SUMMARY
BUSINESS BASICS
- TYPES OF BUSINESSES
  - SOLE PROPRIETORSHIP,
  - PARTNERSHIP
  - CORPORATION
  - LIMITED LIABILITY COMPANY (LLC)
  - NON-PROFIT ORGANIZATION
- SOME BASIC ECONOMICS
  - SUPPLY & DEMAND
  - FIXED AND MARGINAL COSTS
  - THE VALUE CHAIN
- BASIC ORGANIZATION TYPES
  - FUNCTIONAL ORGANIZATION
  - HOW TO READ AN ORGANIZATION CHART
  - MULTI-BUSINESS UNIT OR DIVISIONAL ORGANIZATION
  - MATRIX ORGANIZATION
- SUMMARY
BUSINESS STRATEGY
- WHAT IS BUSINESS STRATEGY?
- LEVELS OF STRATEGY
- DIFFERENT APPROACHES TO STRATEGY
  - PORTER’S COMPETITIVE STRATEGY
  - BLUE OCEAN STRATEGY
  - CORE COMPETENCIES
  - DIVERSIFICATION STRATEGY
  - GENERAL ELECTRIC’S #1 OR #2
  - SCENARIO PLANNING
  - THE BALANCED SCORECARD
- THE STRATEGY SETTING PROCESS
- A DAY IN THE LIFE OF A CHIEF STRATEGY OFFICER
- Jim Schneck, Vice President, Strategy and Corporate Development, Maritz, Inc.
- A DAY IN THE LIFE OF A STRATEGY MANAGEMENT CONSULTANT
- Francis Gouillart, Founding Partner, ECC Partnership.
- Jobs in Business Strategy
- INTERNET RESOURCES
- SUMMARY
LEADERSHIP
- WHAT IS LEADERSHIP?
- FAYOL & TAYLOR: PRINCIPLES OF MANAGEMENT
- LEADERSHIP AND POWER: USES AND ABUSES
- CAPTAIN OF THE TEAM: WHAT DOES A LEADER DO?
  - MANAGING STAKEHOLDERS
  - BALANCING ACT
  - DEVELOPING LEADERS AT ALL LEVELS
- LEADERSHIP STYLES: HOW DOES A LEADER DO IT?
- SOME EXAMPLES
  - ANDY “MAD HUNGARIAN” GROVE – PARANOID CEO
  - “NEUTRON” JACK WELCH – AMERICA’S TOUGHEST (AND MOST ADMIRED) BOSS
  - MEG WHITMAN – OPEN-MINDED INFLUENCER
  - LEE IACOCCA – SUPERSTAR CEO
  - HAROLD “MEAN” GENEEN – MICROMANAGER EXTRAORDINAIRE
  - “CHAINSAW” AL DUNLOP – RAMBO IN PINSTRIPES
- THE BOARD OF DIRECTORS
  - CORPORATE GOVERNANCE
- A DAY IN THE LIFE OF A CHIEF OPERATING OFFICER
- Roger McCarthy, co-President, Vail Resorts and COO Breckenridge and Keystone Ski Resorts
- A DAY IN THE LIFE OF A CHIEF EXECUTIVE OFFICER
- Gail Plummer, CEO, Altair Global Relocation
- Jobs in Leadership
- SUMMARY
FINANCE & ACCOUNTING
- WHAT IS FINANCE?
- WHY IS FINANCE IMPORTANT?
  - THE CONCEPT OF INTEREST
  - PRESENT VALUE AND FUTURE VALUE
  - RISK
  - SAVING, SPENDING, BORROWING AND INVESTING
  - THE “QUANTS”
- WHAT IS ACCOUNTING?
- FINANCIAL STATEMENTS
  - WHY ARE FINANCIAL STATEMENTS IMPORTANT?
  - THE BALANCE SHEET
  - THE INCOME STATEMENT
  - OTHER FINANCIAL STATEMENTS
- WHERE ACCOUNTING AND FINANCE MEET
  - THE AUDIT FUNCTION
  - Control systems
  - Some Control Failures
- INVESTORS: SHAREHOLDERS AND BONDHOLDERS
  - STOCKS
  - Common versus Preferred Stock
  - Stock Exchanges
  - Stock Split
  - THE ANNUAL MEETING,
  - PROXIES
- CREDITORS
  - LOANS AND LEVERAGE
  - BONDS
  - Bonds and Interest Rates
  - What is a Credit Rating?
  - The Yield Curve
- A DAY IN THE LIFE OF A CFO
- Paul Brooks, Chief Financial Officer, Experian
- INTERNET RESOURCES
- SUMMARY
MARKETING
- WHAT IS MARKETING?
- WHY IS MARKETING IMPORTANT?
- STRATEGIC MARKETING PLANS
  - THE SWOT ANALYSIS
  - BCG GROWTH SHARE MATRIX
- IDENTIFYING YOUR CUSTOMERS
  - CUSTOMER, SHOPPER, USER
  - CUSTOMER PROFILES
- MARKETING APPROACHES
  - MASS MARKETING
  - MASS CUSTOMIZATION
  - RELATIONSHIP MARKETING
  - INTERNET MARKETING
  - ONE-TO-ONE MARKETING
- CUSTOMER RELATIONSHIP MANAGEMENT
  - BRANDS AND BRANDING
  - BRAND EQUITY
  - BRAND EXTENSIONS
  - LADDERING PROCESS OR HOW TO GET AT CORE VALUES
  - UNIQUE SELLING PROPOSITION
- ADVERTISING
- A DAY IN THE LIFE OF A MARKETING EXECUTIVE
- Eric McCarthey, Sr. Vice President, Managing Director, Global 7-Eleven Business Unit, Coca-Cola
- INTERNET RESOURCES
- SUMMARY
SALES
- WHAT IS SALES?
- WHY IS THE SALES FUNCTION IMPORTANT?
- DISTRIBUTION CHANNELS
  - SELLING TO THE CONSUMER
  - SELLING TO INSTITUTIONS
  - CALL CENTERS
- WHO IS THE CUSTOMER?
  - SEGMENTATION OF THE SALES FORCE
- REWARD STRUCTURE (OR INCENTIVES)
  - SALARY OR COMMISSION?
  - QUOTAS
  - PUBLIC RECOGNITION AND AWARD PROGRAMS
- A DAY IN THE LIFE OF A SALES EXECUTIVE
- Vincent Roche, Vice President, Global Sales, Analog Devices Inc.
- INTERNET RESOURCES
- SUMMARY
MANAGEMENT OF INFORMATION SYSTEMS
- WHAT IS THE MANAGEMENT OF INFORMATION SYSTEMS?
  - THE AUTOMATION OF INFORMATION AND COMMUNICATION
- WHY IS MIS/IT IMPORTANT?
  - BUSINESS PROCESS ENGINEERING
- THE PEOPLE IN MIS
- INFORMATION PROCESSING
  - DATA WAREHOUSING
  - DATA MINING
  - LEGACY SYSTEMS
  - DECISION SUPPORT SYSTEMS
  - DATA SILOS
  - DATA MARTS
  - SWIVEL CHAIR NETWORKS
  - WHO OWNS THE DATA?
- SYSTEMS DESIGN
  - END PRODUCT UTILITY
  - SYSTEM RELIABILITY
  - REPAIR AND UPGRADES
- SECURITY
  - HACKER AND PHISHER PATROL
  - KEEPING BUSINESS AND CUSTOMER DATA SAFE
- A DAY IN THE LIFE OF AN MIS MANAGER
- Monica Herbold, Vice President, Information Systems, A West Coast Bank
- INTERNET RESOURCES
- SUMMARY
HUMAN RESOURCES
- WHAT IS HUMAN RESOURCES?
- WHY IS HUMAN RESOURCES IMPORTANT?
- STRATEGIC VERSUS TRANSACTIONAL HUMAN RESOURCES
  - ADMINISTRATORS, SPECIALISTS AND GENERALISTS
- THE HIRING PROCESS
  - PERSONALITY & SKILLS TESTS
  - HIRE FOR SKILLS OR ATTITUDE?
- THE APPRAISAL PROCESS
  - TO RANK OR NOT TO RANK?
- TALENT MANAGEMENT AND PEOPLE DEVELOPMENT
  - THE DIVERSITY DEBATE
  - TRAINING
  - JOB ROTATION & STRATEGIC ASSIGNMENTS
  - BUILDING THE GENERALIST
- MOTIVATION
  - REWARD SYSTEMS
  - Job-Based Pay
  - Skill-Based Pay
  - Pay for Performance
- ORGANIZATION DEVELOPMENT
  - ORGANIZATION BEHAVIOR
  - ORGANIZATION DESIGN
- A DAY IN THE LIFE OF AN HR MANAGER
- Keith Lawrence, Director of Human Resources, Global Beauty, Procter & Gamble
- INTERNET RESOURCES
- SUMMARY
SUPPLY CHAIN
- WHAT IS A SUPPLY CHAIN?
  - SUPPLY CHAIN VERSUS VALUE CHAIN
- WHY IS THE SUPPLY CHAIN IMPORTANT?
  - PARTNERING ALONG THE SUPPLY CHAIN
- PROCUREMENT OR PURCHASING
  - WHAT IS PURCHASING?
  - WHY IS PURCHASING IMPORTANT?
  - ECONOMIES OF SCALE
  - LEVERAGING PURCHASING POWER
  - B-2-B EXCHANGES
  - AUCTIONS & REVERSE AUCTIONS
- OPERATIONS
  - WHAT IS OPERATIONS?
  - WHY IS THE OPERATIONS FUNCTION IMPORTANT?
  - MASS PRODUCTION, MASS CONSUMPTION & THE DISEMBODIED WORKER
  - Factors of Production
  - MANUFACTURING PLANNING AND CONTROL SYSTEMS
  - MRP and MRP-II
  - Job Shops
  - Mass Customization
  - LEAN MANUFACTURING
  - Just-in-Time and Kan-Ban
  - Quality, Six-Sigma and ISO Certification
  - OUTSOURCING
  - WHY OUTSOURCE?
- LOGISTICS AND DISTRIBUTION
  - WHAT IS LOGISTICS?
  - Scheduling Algorithms
  - WHAT IS DISTRIBUTION?
  - RFID
- A DAY IN THE LIFE OF A SUPPLY CHAIN MANAGER
- Chris Barry, Senior Strategic Solutions Manager, FedEx
- CAREERS IN SUPPLY CHAIN MANAGEMENT
- INTERNET RESOURCES
- SUMMARY
RESEARCH & DEVELOPMENT
- WHAT IS RESEARCH & DEVELOPMENT?
- WHY IS R&D IMPORTANT?
  - R&D AS A PERCENT OF TOTAL SALES (R&D INTENSITY)
- R&D THROUGH THE GENERATIONS
  - FIRST GENERATION R&D
  - SECOND GENERATION R&D
  - THIRD GENERATION R&D
  - FOURTH GENERATION R&D
- THE TREASURE HUNT
  - DIFFERENT INNOVATION MODELS
  - THE GREENHOUSE EFFECT: NURTURING GOOD IDEAS
  - Skunk Works
  - Greatest Idea & Best Failure Awards
  - Customer Insights or Lead Customer R&D
- IF WE BUILD IT, WILL THEY BUY IT?
  - THE DESIGN & DEVELOPMENT PROCESS
  - EVALUATING PRODUCT DEVELOPMENT
  - PERT and Gantt Charts
  - Phased Process Evaluations
  - Metrics
- A DAY IN THE LIFE OF AN R&D MANAGER
- Bob Niichel, Director of R&D, A Pharmaceutical Company
- INTERNET RESOURCES
- SUMMARY
OTHER STAFF FUNCTIONS
- LEGAL
  - WHAT DOES THE LEGAL DEPARTMENT DO?
  - Contracts
  - Intellectual Property Protection
  - Legal Defense
  - Public Documents
  - WHY IS THE LEGAL DEPARTMENT IMPORTANT?
- COMMUNICATIONS
  - INTERNAL COMMUNICATIONS
  - EXTERNAL COMMUNICATIONS
- INVESTOR RELATIONS
  - CORPORATE GOVERNANCE
  - CORPORATE SOCIAL RESPONSIBILITY
- PUBLIC AFFAIRS
- HEALTH, SAFETY AND ENVIRONMENT
- QUALITY
- CUSTOMER ADVOCACY
- A DAY IN THE LIFE OF A CORPORATE AFFAIRS EXECUTIVE
- Kathleen Linehan, Vice President (retired) Corporate Affairs, CEEMA, Philip Morris
- SUMMARY
Appendix: Job/Career Training and Preparation Resources
Glossary
Annotated Bibliography
Index

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