FOUNDATIONS OF INTERNATIONAL BUSINESS
PAPER CODE: BBA-6003
QUESTION-1. Define and explain the concept of Business. What are thesignificant characteristics of Business and Business Organizations? Answer:Business
Business is not a new or modern concept rather it is eras old. A
Business is animportant institution in any society in any part of this world. Be it for the supply of goodsor services, creation of employment opportunities, offer of better quality life, orcontribution to the economic growth of a country, the role of business is crucial. So the first
question arises in anyone’s mind is what really a business is? The following definition is an
attempt to provide appropriate answer.
“A Business is nothing more than a
person or group of persons properly organized toproduce or distribute goods or services. The study of business is the study of activitiesinvolved in the production or distribution of goods and services-buying, selling, financing,
personnel and the like”
.Practically the above said definition is true but in theoretical sense it is incorrect. Beforeany activities can be considered in the business, there must exist both the goal of profit andthe risk of loss. Thus Business can be accurately defined by K.
Ashwathapa as “Complex
field of commerce and industry in which goods and services are created and distributed in
the hope of profit within a framework of laws and regulations”.
The Concept of Business:
To understand any business the critical step is to explore all thefactors related to business and properly judging its impact on the business. There are manyfactors and forces which have considerable impact on any business. All these forces comeunder one word called environment. Hence understanding the business meansunderstanding its environment. Environment refers to all external forces which have abearing on the functioning of business.From the micro point of view, a business is an economic institution, as it isconcerned with production and/or distribution of goods and services, in order to earnprofits and acquire wealth. Different kinds of organizations (i.e., sole trader ship,partnership, Joint Stock Company and co-operative organization) are engaged in businessand are operating from small scale, as in case of grocery in a start, to large scale, as in caseof Tata Iron and Steel Co., Bajaj Auto, Maruti Udyog, and Reliance Industries.