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Business is an integral part of our daily lives. The term is used to describe organisations that operate in a market to sell goods and services for a profit. Businesses can take a variety of different forms and operate in a wide range of different industries. Some organisations’ main goals are maximising profits, while others pursue social and environmental objectives.
It is important to keep in mind that business studies goes beyond explaining the different types of business and understanding finances - you will cover a wide range of topics such as innovation, leadership, global marketing and organisational culture. By studying business you will not only understand how to sell goods and services but gain deeper insight into markets, stakeholders, strategy and decision-making.
Are you studying for your upcoming business exam or starting to write your business coursework? StudySmarter can help you with business studies revision and preparation. On StudySmarter, we cover all business topics and provide you with detailed revision notes and guides. You also have free access to a business quiz and hundreds of business studies topic flashcards.
On StudySmarter you can access all business studies learning material for free. Prepare for your exams with our complete guide of business topics and revision notes. Check your business knowledge with our existing flashcards and quizzes, or create your own personalised flashcards with your friends.
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Throughout your business course, you will learn about the various elements and functions of the business including operations, finance, marketing, human resources, management and strategy. You will familiarise yourself with the key aspects of business decision-making in different contexts and environments. You will also broaden your understanding of how decisions impact different stakeholders of the business. Finally, you will be able to evaluate managerial and strategic decisions through qualitative and quantitative analysis. On StudySmarter you will find detailed summaries and revision notes on the following key business topics and subtopics:
Nature of Business
As a first step, we have to understand what businesses are and why they exist. Businesses exist to make profit, survive, grow and even reach social aims. One key feature of businesses is that they all have a mission and should have objectives that guide them to attaining their mission.
Another important step is understanding the different forms of business. This is an important concept to consider when making business decisions and evaluating performance.
The external environment also plays an important role in decision making and includes various factors like competition, demographics, the environment or interest rates, which can hugely influence operating costs and the demand for a business’s products and services.
To test your knowledge take a look at our business studies flashcards under the ‘Nature of Business’ subtopic!
Management is another key component of business studies. Managers play a key role in all forms of business. Their role is not only about making decisions, analysing, planning and reviewing, but also finding an effective leadership style through which they can motivate and support employees. They also need to understand stakeholder needs and how to manage relationships between various stakeholders. Managers should make decisions based on data and intuition, keeping in mind the mission and objectives of the organisation.
To find out more about management and leadership, take a look at our detailed summaries under the ‘managers’ section.
Marketing is an integral part of every business. By setting effective marketing objectives, a company can boost its sales, gain market share and increase brand loyalty. To achieve these results, the business needs to understand the market and consumers, which can be done through primary and secondary research. Marketing also involves segmenting consumers, targeting a defined segment and positioning the product or service effectively – through a niche or mass-market strategy. An additional tool for marketing decision-making is the marketing mix, which is made up of the 7Ps:
To learn more about the essentials of marketing and decision making to improve marketing performance, take a look at the ‘marketing’ business studies revision guide.
Setting operational objectives is another fundamental part of the business. Operational objectives can include:
Flexibility or dependability
Once operational objectives have been set, the business needs to analyse its operational performance. Operational performance can be measured through operational data – by calculating metrics like labour productivity or unit cost. Through these calculations, we can understand the business’s operational strengths and weaknesses and make further decisions on how to optimise efficiency and productivity. Another core concept in operations management is understanding supply chains and managing inventory. These are essential for maximising operational efficiency.
The financial performance of a business is based on a couple of key factors. The business has to plan, analyse, make decisions and set financial objectives. Financial objectives can include things like:
Cash flow objectives
Capital expenditure objectives.
These can be measured through performance metrics like return on investment (ROI), profitability ratio analysis, break-even analysis or cash inflows and outflows. Financial performance also includes budgeting, forecasting and sourcing finance. There are many ways businesses can source finance in both the long and the short term. It all comes down to understanding how we can make effective financial decisions that boost the financial performance of the business.
Human resource decisions can also expand the competitiveness of a business. Human resource objectives could include training, diversity and employee engagement. Both internal and external factors can influence how a business sets human resource objectives.
For a deep dive into human resources related decision-making check out our summaries under Human Resources.
To understand the strategic position of a business we need to analyse its mission, objectives and strategy. We need to look at a business’s internal position and performance to understand where strengths and weaknesses come from. In order to understand opportunities and threats, the business needs to examine its external environment through a PESTLE analysis and the competitive environment through Porter’s five forces.
To learn more about how the external and internal environment plays a role in business strategy, take a look at our summaries under analysing the strategic analysis section.
Every business needs to choose a strategic direction - they need to decide which market to operate in, what products to offer and how to enter the selected market. Businesses also need to determine their strategic positioning and sustain their competitive advantage.
To find out more about competition and strategy, take a look at our in-depth summaries under strategic direction.
Once a business has established its strategy, it is time to figure out how to pursue the strategy in a profitable way. It is important to evaluate whether the business is growing and find strategies to overcome problems in case the business is stagnant or growing too quickly. Innovation and internationalisation can play a huge role in the growth of a business. Recently, digital technology has also become valuable for strategy and almost inevitable for businesses to adopt.
Change can often be a daunting process for businesses. The causes for change can be internal or external but either way, it can be very valuable for strategy. The problem is that change often comes with resistance. Managers have to successfully overcome barriers to change by leading organisational culture and implementing strategy effectively.
Take a look at our revision notes on change management for more detail!
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