Trends in Small Business Development

A closer look at changes in the industry distribution of small businesses suggests somewhat different trends. Retailing, the largest segment of small business, along with manufactur­ing, is in relative decline. But the number of service and construction enterprises is increasing. How­ever, all generalized trends must be interpreted cau­tiously. For instance, the overall decline of manu­facturing doesn't mean that every manufacturing operation has less promise than, say, a service enterprise (an area that is growing). Obviously, it depends on what you're manufacturing and where. While microchips in the San Fran­cisco Bay area may be booming, auto parts in Ohio or electric light plugs in Pennsylvania are not. In fact, given the overall performance of small busi­ness in recent years, sales and earnings of small business have been well below their long-term aver­age since 1979.

The Franchise Boom

The growth of small business service enterprises has been stimulated over the past decade by fran­chise operations. The franchise is perhaps easiest understood as a marriage between big business and small enterprise. The franchiser (big business) grants the franchisee certain exclusive rights—to the name of the business and/or to a particular range of widely advertised products or services. The franchisee in turn agrees, usually, to an initial fee and continued regular payments (either flat-rate monthly payments or payments based on sales).

2.Give the summary of the text levels of authority: the management pyramid1

Within all organizations, managers operate through a hierarchy of responsibili­ties and functions. Although most businesses utilize many layers of manage­ment, these generally fall into three categories: top or upper managers, middle managers, and operating or supervisory managers.

Management is a pyramid of authority and power. Nearer the top, the authority is greatest and the scope of responsibility the broadest. Further down the pyramid, authority diminishes² and responsibilities have become more specific and more clearly defined.

Top Management

Top management includes the president and the vice-presidents of the firm. In a large enterprise, each of these vice-presidents is responsible for a particular aspect of the business—for example, production, personnel, marketing, finance, research, accounting, or overseas operations. The president has authority over all of these functional decisions and is responsible to the board of directors and ultimately to the stockholders. Top management comprises³ the firm 's most powerful decision-makers. Although they may have little knowledge of day-to-day events within the firm, they must develop the longer-range plans and strategies necessary for the firm to attain its objectives. Their capacity to comprehend "the big picture" and to initiate needed action accordingly is crucial to the success of the firm. Generally when an enterprise has trouble or fails outright, the difficulty can be found at this level.

Obviously, some firms are more successful than others in preventing "dead wood⁴" from accumulating in their upper branches. Exxon, as we saw earlier, has employed the device of "management committees" to create both a sense of shared responsibility and a built-in check on upper management performance. However, the Success and Failure section suggests that a very different top level management situation developed at General Motors in the early 1970s. The result may have contributed to the recent troubles of the American automobile.

Middle Management

Middle manager's responsibilities are largely interpretive. Existing between the broad policy level and the day-to-day operation, they must translate and inte­grate policies set by top management. In general, middle managers are depart­ment heads such as plant managers, heads of marketing or accounting depart­ments, or regional sales managers. Although their authority is not nearly as great as that of top management, middle managers are still generally responsible for the hiring and evaluation of employees, the selection and purchasing of machin­ery and equipment, and the introduction of many marketing techniques employed by the firm.

Supervisory Management.

Supervisory managers are responsible for the daily, even hourly, execution of prefigured plans sent down by middle management. Their performance can be no better than the directions they are given. However, this "front line" of management authority still has important discretion⁵ and responsibility. As the final representatives of management to the employees, they must possess con­siderable leadership skill. They also must make countless decisions daily as they adapt various aspects of higher level plans to "actual" working conditions.

THE BASIC FUNCTIONS OF MANAGEMENT

Management's role within any organization may be subdivided into four general functions: planning, organizing, directing, and controlling. These basic activ­ities are continuous and overlapping.⁶ They should not be seen simply as stages.

Planning.

Planning is the function of setting and constantly reviewing any future courses of business action that will achieve company objectives. Planning activities affect all aspects of a firm's operations: research and development, personnel, production, marketing, and financing policies. Planning rests on the assumption⁷ that all business and economic conditions undergo⁸ change—yes­terday's policies and habits must always be subject to review. Planning is the most important of the four management functions: All other efforts, no matter how diligently they are followed, are likely to fail if planning breaks down..

The role of planning has been increasingly important in the last quarter of the twentieth century. A hundred years ago most companies could operate with very little planning. Technological, capital, and market conditions, while undergoing continuous change, did not change very rapidly. Without much planning effort, most firms could adapt fairly easily to new busi­ness conditions and changes in the business environment.

Not only has the world economy grown more complicated, but businesses of all types and sizes have become more complex—and all evidence suggests that complexity and complications will demand ever-greater planning activity on the part of business managers.

Consider the automobile industry, for example. Between the 1930s and the early 1970s (except during the years of World War II) the American automobile industry's planning activities were almost exclusively limited to superficial mat­ters of styling and design. To be sure, occasional changes were initiated in automobile technology, the production process, and the marketing emphasis. But, overall, Detroit built pretty much the same thing year in and year out—big, sleek, higher horsepowered automobiles. By 1973, consumers were buying nearly 10 million of them each year. To almost every observer, the industry seemed sound and secure.

1 Active words are of extended type

2 Cart \\ тележка для отбора товаров в магазине самообслуживания

3 five and dime store \\ Магазин товаров повседневного спроса типа «тысяча мелочей».

4 Junk \\ «бросовый» товар

5 pitch \\ реклама (по радио, телевидению)

6 borne уст. = bourn \\ ручей

7 adage \\ (старинная) пословица, поговорка; изречение

 Active words are of extended type

 intercity \\ междугородные грузовые автоперевозки

 chain \\ сеть розничных магазинoв

^ shrink \\ уменьшать, сокращать, сжимать



 Active words are of extended type

^ ailment \\ недомогание, нездоровье, болезнь

3 bludgeone \\ вынуждать

4 frenzied \\ бешеные /лихорадочные/ усилия





 worldliness \\ поглощённость земными заботами

6 redeemable \\ выкупаемый, погашаемый

7 long-run costs \\ предельные издержки длительного периода



 Active words are of extended type

2 immune \\ обладающий иммунитетом человек

3 stagger \\ ошеломлять; потрясать, поражать

4 per capita \\ лат. на человека; на душу (населения)

5 bullish \\ преуспевающий, растущий (напр. о каком-л. секторе экономики)

6 testimony \\ доказательство, свидетельство

7 tout \\ разг. усиленно расхваливать, рекламировать

8 prune \\ чернослив

1 Active words are of extended type

2 span \\ интервал, промежуток времени

3 daily \\ ежедневная газета

4 bathtub \\ встроенная ванна

5 conceivable \\ мыслимый, возможный

6 junk mail \\ макулатурная почта (реклама, циркуляры и т. п.)

7 intermediate \\ эк. промежуточный продукт, полуфабрикат

8 gaudy \\ слишком яркий, броский, кричащий

1 Active words are of extended type

2 hawk \\ торговать на улицах (обычно шумно предлагая товар)

3 barrage \\ масса, поток

4 trial \\ испытание, проба

5 key \\ приспосабливать (к чему-л.); приводить в соответствие (с чем-л.)

6 cardboard \\ картон

7 aisle \\ проход между полками (обыкн. в магазине самообслуживания)

8 rack \\ полка; стеллаж

1 Active words are of extended type

2 kit \\ разг. комплект, набор (вещей)

3 lavish \\ щедрый; расточительный

4 abusive \\ жестокий, негуманный

5 offset \\ возмещение, компенсация

6 minorities \\ pl национальное меньшинство

7 militant \\ активист; борец

8 abide \\ следовать (чему-л.), выполнять (что-л.)

9 halt \\ останавливать; обрывать; прекращать

1 Active words are of extended type

2 markup \\ ценообразование

3 margin \\ коэффициент прибыльности

4 well-to-do \\ обеспеченные слои общества

5 crate \\ упаковочная корзина

6 apparel \\ предметы одежды

7 constraint \\ ограничение

8 wary \\ осторожный, осмотрительный

9 tight-fisted \\ скупой, прижимистый

1⁰ cater \\ поставлять провизию: снабжать продовольствием

1¹ sauerbraten \\ нем.жаркое из говядины, вымоченной в уксусе

1² clientele \\ клиентура

1 Active words are extended type

2 initial \\ первые

3 in-lieu payment\\ выплата взамен (напр. другой формы возмещения)

4 proxy \\ полномочие, доверенность (выдаваемая акциедержателем на право голосования)

5 corral \\ разг. присваивать, завладевать

6 muster \\ собирать

7 defeat \\ расстраивать, срывать; разрушать (планы, замыслы и т. п.)

8 takeover proposal \\ предложение о приобретении (фирмы), предложение о слиянии

9 merger \\ поглощение (путём приобретения ценных бумаг или основного капитала); слияние (компаний)

1⁰ reluctant \\ сопротивляющийся

1¹ retain \\ удерживать; сдерживать; поддерживать

1² sought-after \\ модный, престижный

¹³ taxing \\ требующий большого напряжения или усилий

¹⁴ assaults \\ резкие выступления (против кого-л., чего-л.); нападки

¹⁵ leverage \\ система рычагов

¹⁶ grumbling \\ ворчание, ропот; жалобы

1

1

1

1

1 Active words are of extended type

2 astound \\ поражать, изумлять

3 cluster \\ собираться группами, толпиться, тесниться

4 abreast \\ не отставая; держась на (должном) уровне

5 discrepancy \\несоответствие, расхождение; различие; несогласие

1 Active words are of extended type

2 custom-made \\изготовленный, сделанный на заказ

3 heft \\ воровство; кража

4 deplete \\истощать, исчерпывать (запас); опустошать

5 obsolete \\устарелый, вышедший из употребления

6 expeditious \\ срочный; неотложный; поспешный

7 malfunction \\ неисправная работа; неправильное срабатывание

8 jumbo \\ слон

9 presumably \\возможно, вероятно; предположительно; по-видимому

1 Active words are of extended type

2 facilitate \\ облегчать, помогать, способствовать

3 anticipation \\ ожидание, предвидение, предчувствие

4 to defer payments \\ отсрочивать платежи

5 merit \\ заслуживать, быть достойным

6 lapel \\ отворот, лацкан

7 markdown \\ снижение (цены)

8 garment \\ предмет одежды

9 random \\ выбранный наудачу

1⁰ arm out \\ отдавать на откуп

1 Active words are of extended type

2 salient \\ бросающийся в глаза, характерный

3 soaring \\ (быстро) растущие

4 dribble \\ ручеёк

5 contraction \\ ограничение; сокращение (деловой активности и т. п.)

6 build-up \\ сл. спектакль с растущими сборами

7 paraphernalia \\ личное имущество

8 bundant \\ распространённый

9 aptly \\ быстро, легко, умело

1⁰ vanishing \\ исчезающий

1 Active words are of extended type

2 hreshold \\ порог

3 shun \\ избегать, держаться в стороне

4 inclination \\ предрасположение, предрасположенность, склонность

5 shy \\ сторониться, избегать; уклоняться, увиливать

6 merge \\ сливать, соединять (банки, предприятия и т. п.)

7 underway \\ продвижение

8 to get smth. off the ground \\ успешно положить начало

9 commuter airline \\ местная авиалиния

1⁰ would-be \\ претендующий (на что-л.); мечтающий (о чём-л.)

1 Active words are of extended type

2 diminish \\ умалять, преуменьшать (значение чего-л.)

3 comprise \\ включать, заключать в себе

4 to have / the dead-wood on smb. \\ амер. поставить кого-л. в тяжёлое положение

5 discretion \\ свобода действий; право свободно решать, выбирать; полномочия

6 overlapping \\ перекрывающий(ся); частично совпадающий

7 assumption \\принятие на себя (ответственности, обязанности и т. п.)

8 undergo \\ испытывать, переносить