Business Concepts

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Business entities

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Organizations legally recognized to conduct business activities. Example: Different business entities require different reporting and control systems.

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Target markets

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Specific groups of customers a company aims to serve. Example: The company adjusted its structure to better serve its target markets in Asia.

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Functional structure

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An organizational design grouped by business functions. Example: A functional structure separates departments such as finance, marketing, and operations.

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Chain of command

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The formal line of authority from top management to lower levels. Example: A clear chain of command ensures accountability in decision-making.

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Senior management

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Top-level executives responsible for strategic decisions. Example: Senior management approved the company’s long-term restructuring plan.

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Middle management

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Managers who link senior management and operational staff. Example: Middle management plays a key role in implementing strategy.

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Junior management

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Entry-level or first-line managers supervising daily operations. Example: Junior management oversees staff performance on a daily basis.

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Lines of communication

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Formal pathways through which information flows in an organization. Example: Flat structures often improve lines of communication.

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bureaucratic

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Characterized by excessive rules and slow decision-making. Highly bureaucratic organizations struggle to respond quickly to change.

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product lines

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Groups of related products managed as separate units. The firm reorganized around product lines to improve innovation.