ImperialMIT

This blog represents my ambition to review previously studied academic topics. Despite having studied Biology with Management, you should only really expect commercially focused articles. Expect a lot of breadth, and perhaps on occasions depth. I’ll start with the basics, from Accounting to Economics, plus more!

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The Art of Creative Destruction and Unicorns.

Entrepreneurship is the process of designing, launching and running a new business venture. Though often associated with small businesses, entrepreneurship can occur within larger organisations (and arguably within not-for-profit organisations), albeit such individuals are known as intrapreneurs (and in the case of not-for-profit organisations, innerpreneurs). Founders are the individuals that have to undertake some or all of the risk required for the new venture to generate economic value (albeit alternative names such as philanthropists/hobbyists may be used in alternate circumstances).

Start-ups represent entrepreneurial ventures, typically conceived of as fast-growing and new (albeit not necessarily innovative or valuable). These businesses usually aspire for a liquidity event (not to be confused with liquidation/discontinuance of service) — conversion of ownership by early investors into cash (e.g., through an IPO or sale of the business). I will be exploring how businesses can develop and scale business models, accommodating risk through an effective business plan. Further more I will be exploring sources of capital (e.g., private equity, such as angel investors and venture capital; debt options, such as loans from banks; grants options) and predators of success (e.g., access to an incubator/accelerator).

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The case for novelty.

Innovations are the economic application of a new idea (new/modified product or process). Innovations should be distinguished from inventions (which first and foremost lack economic value). On the other hand, exnovation refers to the discontinuance of the economic application of a new idea (albeit the product or process may not be discarded), whereas obsolescence represents the absence of value in a product or process that has been replaced/no longer used. Within organisations, innovations are associated with an economic value (e.g., reductions in cost through efficiency/productivity; increase in revenue through a higher perceived value, competitiveness and market share).

I will explore the variant tools that can be used for innovation strategy and management, along with the competing theories, types, and sources of innovation. In a similar way, I will also explore exnovation and obsolescence.

Industry Emerging Technology(s) Agriculture Cultured Meat, Précision Agriculture, and Vertical Farming. Entertainment Screen-less Displays. Energy Wireless Energy Transfer. Information Technology Li-Fi, 5G, Artificial General Intelligence, Augmented Reality, Blockchain, Cryptocurrency, Internet of Things, Machine Vision, Quantum Computing, Semantic Web, Speech Recognition, and Virtual Reality. Medical Neuroprosthetics, Head transplant, Tissue and Genetic Engineering. Military Cloaking Device, Directed Energy Weapon, Force Field, Sonic Weapon, Vortex Ring Gun, Wireless Long-range Electronic Shock. Robotics Android, Gynoid, Powered Exoskeleton, Swarm Robots, Unmanned Vehicles. Transport Flying Car, Hover Bike, Jet Pack, Magnetic Levitation, Space Elevator.

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Marketing is not advertisement.

Marketing is an exchange relationship between organisations and their customers. Value (e.g., products and services) are exchanged to fulfil the demands of an individual or group (needs and wants that can be realised through a transaction). Managers realise the exchange relationship by influencing potential customers (e.g., exploiting perceptions of values strategically).Marketing tools and techniques will be explored further within this blog.

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Managing human capital and other resources within the workforce.

Human resource management (HRM) can be defined as the management of human resources (people that constitute the workforce of an organisation). Human capital refers to the economic value that can be provided through labour. Generally, HRM is a means to maximise employee performance. Therefore, HRM may be personnel management, or a means to establish a competitive advantage/achieve strategic objectives.

HRM is influenced by organisational behaviour (the behaviour of individuals and collectives interacting within workforces). HRM is important because of the opportunity to reduce employee turnover (essentially reducing hiring cost through retaining talent/human capital). I will be exploring how firms establish their culture and leadership, as well as the strategies which motivate organisational citizenship, whilst discouraging counterproductive work behaviour.

The Three Layers of Organisational Behaviour

Micro Meso Macro Individuals Groups/Teams Organisation

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The Internationalisation and Globalisation of trade.

Let’s talk about international businesses. Internationalisation references the process of integrating into the world economy by virtue of increasing involvement in international markets. Globalisation references a process of worldwide integration, through which there is an increased interaction between countries (e.g., in terms of trade and information flow). There are several theories for internationalisation and globalisation. These reasons include the free flow of goods and services, along with developments in information technology. The strategic process of foreign direct investment and choice of entry mode, along with internationalisation theories will be explored further within this blog.

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Corporate Sustainability.

Let’s go green. Sustainable businesses ensure a minimal negative impact on Earth’s Ecosystem through a triple bottom line (TBL) approach, a concept introduced by John Elkington in 1994, contrary to the Friedman doctrine. The triple bottom line suggests that the responsibilities of businesses extend beyond legal obligations (extension of considerations from shareholder to multiple stakeholders). Corporate sustainability often embodies the notion that businesses should satisfy present needs without compromising the ability to do so in the future. Such should not be confused with corporate social responsibility (CSR). The essential characteristics of sustainable businesses concern strategy (e.g., deriving benefit and reducing costs through considering design, biomimicry, waste and ecological footprint).

The Triple Bottom Lines:

People Planet Profit Company’s ‘social equity account’, a measure of corporate social responsibility. A gauge of ecological impact. Company’s conventional ‘bottom line’ of economic profit and loss.

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The Psychology of Business.

Let’s talk strategy — the process that allows organisations to achieve their long-term objectives. Business strategy is a top-level activity devised by senior executive officers (often with the approval of a board of directors). Strategic planning consists of an acknowledgement of available resources, alongside a situational analysis (analysis of what’s going on within and beyond an organisation), recognition of core value proposition (what they do) and target market (whom they do it for), the opportunity cost associated with the choice of venture (whether they should do it), alongside how they can best achieve their target within a foreseeable timeframe (whilst maintaining a competitive advantage).

Business strategy extends beyond planning, also including evaluation and implementation. Projects, plans, and policies serve as examples of methods through which firms can achieve their objectives. Frameworks (business analysis techniques) devised by academics and practising managers can be employed to approach complex and dynamic business problems. Performance is evaluated with a balanced scorecard, and choices of initiatives are expected to align with the vision (desired future state), as well as the mission (purpose) of the organisation.

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The science of money management.

Let’s talk about Financial Theory. Finance is an academic field of economics concerning the study/management of the process of raising and/or allocating monetary resources over time. Because finance is so expansive my inevitable exploration of the associated concepts, markets, and instruments will have to wait. The three main sub-categories within the discipline include personal, corporate, and public finance.

Large-scale monetary mismanagement has resulted in speculative bubbles and crises. Under these conditions asset prices are drastically inflated/assets lose a large amount of their value resulting in the collapse of a single economy or more. I will also explore these phenomena.

Examples of Economic Bubbles and Financial Crises:

Timeline Economic Bubbles Financial Crises 1600s Tulip Mania (1637) 1700s South Sea Bubble (1720) 1900s Japanese Asset Price Bubble (1986–1992) Wall Street Crash (1929) and Great Depression (1929–1939) 2000s Dot-com Bubble (2000-2002) Global Financial Crisis (2007–2008) Speculative Cryptocurrency Bubble

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There’s Utility in Economics.

 Let’s talk about Economy Theory. Economics is the social science that describes how economies and economic agents operate under resource scarcity. Economies reference systems of activity consisting of the production, distribution, and consumption of products and services. Such activities are mediated by agents and principals. Economic agents are decision makers serving their desires within the system, whereas principals authorise the actions of agents. Microeconomics concerns their behaviour (e.g., as individuals and within organisations). In a broader sense, Macroeconomics describes the aggregation of quantities within economic systems. Further sub-disciplines also exist, such as econometrics and contract theory. Where the academic disciple advocates “what ought to be” such science is said to be normative, rather than positive (which simply presents what is).

Economic systems used to be presented as simple dichotomies based on the coordination and ownership of resources. Current world economies are more complex, exhibiting market-oriented mixed attributes. Therefore the table below does not provide an exhaustive list of the types of economies that exist/can be described (e.g., economies can also be described by regional scope, centralisation, and openness). However, all economic systems must provide a basis for what and how much to produce, as well as the owners of the factors and outputs of production.

Common Typology (Economic Systems):

Ownership Form Public Private Allocation Mechanism (Top-Level) Planned (“Hands-on”) Socialist Planned Command Capitalism Market (“Hands-off”) Market Socialism Market Capitalism

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Economics is expansive. There are many avenues to explore. There are many economic measures, activities, forces, challenges, trends and influences to understand. We can improve our lives through economic principles — more reasons to thank homo economicus/ sociologicus.

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You’re speaking my Language.

Let’s talk about financial reporting. Accounting is the process of identifying, measuring, recording, and communicating economic transactions for decision-making (usually in monetary terms, through the publication of financial statements subject to generally accepted accounting principles). Financial accounts are required by law and are produced for external parties such as investors and regulators, whereas management accounts concern useful reports produced for business executives. Despite being the most prominent forms of financial reporting, accounting also extends to more activities (e.g. auditing and book-keeping).

Financial statements are important (and can be pretty complex). They are useful because they provide a formal picture of performance and changes in financial position. Therefore they are expected to be comprehensive, clear, relevant, reliable, and standardised for comparison. Financial accounts are also generally based on historical cost accounting, whereas management accounts tend to produce future-oriented reports involving further analysis (e.g. cost-benefit analysis) that are not required to follow GAAP.

There are three main financial statements. Statements of cash flow represent the closing balance resulting as a consequence of a net cash flow into an economic entity (Cash Inflow - Cash Outflow + Opening Balance). Statements of profit or loss (otherwise known as the income statement) represent the change in the value of a company’s accounts over a set period (usually a fiscal year). The summary of an income statement is usually referred to as the “bottom line”, representing a net income. Statements of financial position (otherwise known as balance sheets) represent an economic entity's assets, liabilities, and equity at a particular point in time (usually at the end of the fiscal year).

Buzzwords:

Consolidated financial statements: statements where the parent company and subsidiaries are presented as a single economic entity.

Financial audits: reports produced to provide an opinion of reasonable assurance (usually through objective independent examinations) concerning the quality of the financial statements of an economic entity.

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Let’s get down to business.

Hello world! My description should have encapsulated the concepts that will be explored within this blog. Considering the focus on commercial topics, let’s explore what businesses are.

Businesses (also known as enterprises, companies, and firms) are entities composed of a collection of individuals engaging in commerce. Such entities are registered under several legal structures concerning their choice of obligation, essentially their choice of ownership and how much personal protection they receive. 

Individuals responsible for the running of an organisation are said to be in management positions (e.g. executives and managers). We often refer to these individuals as those making that “moolah”.  Their choice of function (i.e. Business Management) concerns the process of allocating resources for a purpose. There are several management subcategories (e.g. Project, Operations, Risk, and Change). The sheer subcategory breadth should provide enough reasons as to why specialisation becomes important.

Scope Department Relationship Resource Strategic (Top-Level) Component Line Staff e.g. Change and Innovation Management. e.g. Product and Project Management. e.g. Marketing and Operations Mangement. e.g. Human Resource Mangement. e.g. Customer Relationship Management. e.g. Information Technology Management.

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