Market Leader Advanced
Semester 4 Manual
Units 7-12
Tománkova Groups contains selected chapters of Business Vocab in Use
i
UNIT SEVEN - FINANCE AND BANKING
Finance, Banking
TASK Complete the gaps with the most suitable words. The first letters are always given.
Personal banking
1.  Banks send to their clients m_______________s____________listing recent sums of
money going out, called d__________, and sums of money coming in, called c_______.
2.   Banks transfers include s_________o_________, i.e.  instructions to bank to pay
fixed   sums  of  money  from   a   client's  account  to  another  account,  and   d_______
d__________where the payment date and the amount vary.
3.   Some banks offer o____________, which allow customers to o______________an
account, i.e. withdraw from an account more money than there is actually on it.
4.   M______________are long-term loans on which the property (house, flat) bought
acts as c______________or a guarantee for the bank. If the borrower doesn 't repay the
m_____________, the bank can r____________the property, i.e. takes it back from the
buyer and sells it.
Commercial and retail banking
1.  The capital a bank has and the loans it has made are its a_____________. The
customers' deposits are I_______________because the money is owed to somebody
else.
2.   Banks have to keep a certain percentage of their assets as r_______________for
borrowers who want to w____________their money. This is known as the r_________
r____________________.
3.  Before lending money, a bank has to a____________or calculate the risk involved.
4.  Banks have to find a balance between I______________- having cash available when
d______________want it - and different m______________- dates when loans will be
repaid. They also have to balance y________- how much money a loan pays - and risk.
Central banking
1.  Some central banks are responsible for m____________p______________- trying to
control the rate of inflation to maintain financial stability.
2.   In  many countries, the central  bank s______________and  r______________the
banking system  and the whole financial  sector.  It also  prints and  i______________
currency - putting banknotes into c_______________.
3.  The r________-a________ratio is the minimum percentage of its deposits a bank
has to keep in its reserves.
4.  If depositors think a bank is unsafe, they might all try to w______________their
money. This is called a b_______r__________.
5.  Central banks can act as lender of I_______r__________, which means lending
money to financial institutions in difficulty, to allow them to make payments.
Interest rates
1. An amount of money which is lent or invested to earn interest is called p_________.
2
2.  The d_______________rate is the rate that the central bank sets to lend short-term
funds to commercial banks. When this rate changes, the commercial banks change their own b____________rate, the rate which they charge their most reliable customers.
3.    Banks   make   their   profits   from   the   difference,   known   as   m__________or
s_________, between the interest rates they c__________borrowers and the rates they
p______to depositors.
4.   The  rate that  borrowers  pay depends on  banks'   c_____________________,  also
known as credit standing or credit rating.
5.   Leasing  or h________p_____________(HP)  are  agreements  where a  consumer
makes a series of monthly payments to buy d____________goods (a car, furniture).
Islamic banking
1.  Islamic banking is i________-f_________banking.
2.   Islamic   banks   do   n________pay   interest  to   depositors   or  charge   interest  to
borrowers. Instead they invest in companies and share the profits with their depositors.
Investment financing and trade financing are done on a p______and I_____s________
(PLS) basis.
Stocks and shares 1
1.  Stocks and shares   are c________________representing part o_____________of a
company.
2.  The word e____________(sg) or e_____________(pi) is also used to describe stocks
and shares.
3.    A   successful   existing   company   wants   to   expand,   and   decides   to   g_______
p_____________,    i.e.    to   change   from    a    private   company   to   a    p__________
I____________company (PLC) by selling shares to o____________investors for the first
time.
4.    The   company   makes   a   f_______________or   i____________p____________
o_________________(IPO).
5.  An investment bank u______________the stock issue, i.e. guarantees to buy the
shares if there are not enough other buyers.
Stocks and shares 2
1.   Major stock Exchange, such as New York and London, have a lot of requirements
about publishing financial information for shareholders. Most companies use o_____-the-
c__________(OTC)   markets,   such   as   NASDAQ   in   New  York  and   the  Alternative
Investment Market (AIM) in London, which have fewer regulations.
2.  The n_____________v_____________of a share - the price written on it - is rarely
the same as its market price. This can change every minute during t_____________
hours, because it depends on s_________and d_________- how many sellers and
buyers there are. Some stock Exchange have computerized automatic trading systems
that     match     up     buyers     and     sellers.     Other    markets     have     m____________
m_______________:    traders    in    stocks    who    quote    b________(buying)    and
3
profit or m_
(selling)  prices. The spread or diference between these prices is their -u
3. Companies that require further capital can issue new shares.   If these are offered to
existing shareholders first it is known as r________________issue. Companies can also
choose   to   capitalize   part   of   their   profit   or   r_____________      e______________
(nerozdělený zisk), i.e. to turn their profits into capital by issuing new shares to existing
shareholders instead of paying them a d_________________. There are various names
for this process, including scrip issue, capitalization issue or bonus issue.
Bonds
1.   Bonds are loans to local and national governments and to large companies. The holders of bonds generally receive fixed interest payments and get their money, known as the p_____________, back on a given m______________date.
2.  B_______________, the company issuing bonds, are given credit ratings. This means
they are graded according to their ability to r______________the loan to bondholders
BUSINESS RECOVERY; reading, p. 64
TASK Find the words in the text which mean the following:
1._____________=  a person who is chosen by a court to manage the financial affairs
of a company that is bankrupt, to sell its assets in order to pay its debts, and to close it: The____________ said he had the legal duty to obtain the best price for the
business.
2.  to wind up = to close a company, sell its assets and pay its debts: The court ordered the______________of the company.
3.  handful = a very small number of people or things, the quantity of something that you can hold in your hand
Marconi repays £669 m of debt; reading, p. 64
TASK Complete the gaps with the correct forms of the following verbs:
Par 1-2 : FOLLOW (3X), TAKE, GRANT, ANTICIPATE, EMERGE, CASH IN
Par 3-5: RUN, STAVE OFF, BE, WIPE OUT, DROP, WRITE OFF, LEAVE, BURST, DRY UP
/ Struggling telecoms equipment    maker    Marconi
today A)___________a giant
step towards recovery as it announced         the         early
repayment of £669 m of debt
B)_____________________its
restructuring last year. The money was paid well ahead of the 2008 deadline set by creditors, and will save Marconi   £55,8 m in annual
interest Charles. "The early paydown of all our restructuring debt is an excellent achievement, " Mike Parton, the Marconi chief   executive,   said.   "We
have C)_______with a strong
balance sheet, and can now fully focus our efforts on growing our business."
repayments _____better-
2       Today's
m_____
than-E)____________returns
from the sale of businesses and improved trading performance at the company.
F)______________________an
increase in confidence among telecoms customers, Marconi announced its first quarterly profits for three years in May. Last   month,   the   improved
4
trading performance enabled three directors, including Mr Parton, to raise almost £9 m
from G._______stock options
H.__________after they met
performance                targets,
including those for debt reduction.
3              Marconi              1}
___________________collapse
in May last year thanks to a restructuring in which banks and bondholders agreed to J}
_________________most   of
the company's debt in return for control. Shareholders saw their   holdings   virtually   K}
4 The near-collapse of the company was one of the most spectacular in British corporate history. Formely GEC, Marconi was an industrial giant built up by Arnold Weinstock, one of Britain's                     premier
industrialists. At its zenith, it
L)________worth more than
£30bn. Problems began when Lord Weinstock's successor, Lord Simpson, decided to focus                                  on
telecommunications, selling profitable   defence   business
and M)___________the name
GEC in favour of Marconi.
5 Marconi N)__________into
trouble three years ago when the     hi-tech     bubble     O)
________________.    Demand
for      is      products       from customers     such     as     BT
P}_______________,   and   it
with  huge an     ill-timed
fíi-
debts after acquisition spree. Thousands of jobs were lost, and Marconi currently employs one third of its 12,400 global workforce at UK sites in Coventry,        Beeston        in
Nottingham,   Liverpool   and Chelmsford.
Stave off= to stop sthfrom happening (odvrátit, zažehnat)
Spree = a short period that you spend doing only one activity, especially something enjoyable such as spending money
or drinking alcohol:
a shopping/spending/buying spree
1.  Who is Marconi? What have they achieved recently?
2.  How does its CEO comment on their future prospects?
3.  Did the early repayment of the debt come unexpectedly?
4.  How would you comment on Marconi's business performance last month?
5.  How did Marconi manage to avoid collapse in May last year? How did it affect shareholders?
6.  Why does the article label the near-collapse of the company as one of the most spectacular ones in British history?
7.  Describe the situation of Marconi 3 years ago.
US Airways vows to rise again; reading, p. 65
TASK In the text find the translation of the following:
zdůraznit své odhodlání =__________
zažádat o ochranu v době konkurzu =
navzdory naléhavému varování =____
věštit zánik podniku =_____________
ukončit plány =__________________
zůstat v konkursním řízení =
TASK 2 - Wordformation:
5
1.   The management team  isn't here to (PRESIDENT, LIQUIDATE)
2.  The company said it was entering____
over a
in order to
cash as it struggles with high fuel costs and competition from low-cost carriers. (BANKRUPT, CONSERVATION)
Listening; 7.5., p. 67
TASK Listen and complete the gaps with the words you hear:
We've had 1.
(2 words) nine months this year. If we look at this
chart,   you    can    see    our   segment    net    revenue,    which    is    all    of   our   stations   2.
_________________________________    (2    words).    In    year   one,    revenue   almost   3.
________________(1 word) between the third and fourth quarters to 40 million dollars. That
4. _____________ (1  word) our revenue for year one 5. _______ (1  word)  119 million
dollars. In year two, our revenue rose by nearly 16 per cent ot 138 million dollars. Now, as you
can see here, segmented revenue for the first quarter 6.____________ (1 word) the first
quarter in year one. It rose to 40 million in the second quarter. Then revenue in the third
quarter 7. _______________ (4 words)  25  million and grew to 47  million  in the fourth
quarter. Last year was another successful year, with revenue reaching 8.__________________
(4 words) 176 million dollars. That's 27.5% growth. 9.________________
were the 10._____________  (1 word) in the second and fourth quarters 11.
word) 48 million and 62 million dollars 12._______________(1 word).   oThis year, we're
expecting another great year. Revenue for the first quarter reched 48 million. It 13.______(1
word) again in the second quarter 15.___________ (2 words) the fourth quarter of last
year. In the third quarter, it 16.___________________ (3 words) 46 million, and we're
expecting to reach 17._____________________________ (4 words) 70 million in the fourth
quarter of this year.
(2 words)
___a
GRAPH MOVEMENT
TASK Classify the following verbs into the below groups, according to the kind of movement they express:
crash; reach a peak; remain stable; shoot up; jump; increase; be a little stronger; rocket; slip; reach a low point; gain; pick up; finish slightly firmer; plummet; remain constant; recover; decrease; fall; top out; slump; level off; peak; bottom out; hit a low; plunge; stay at the same level; stabilize; take off; be slightly weaker; rise; stagnate; soar; to sink
to rise after previously falling		to fall a little	
to rise a little		to fall a lot	
to rise a lot		to    reach    the lowest level	
to     reach     the highest level		not to change	
TASK Complete the information with the most appropriate words from the listening exercise (not direct tapescript).
1)  Four major factor which have_________________(1 word) international banking in recent
years are:
•     globalisation
•     new___________________(2 words)
•     new technology aspects
•_________________________(3 words) capital markets
2)      If     something      is__________________________(2     words)     as     well     as
____________________________________(2 words), the chances (1 word) are that this
will    become    a    new    financial    instrument.    Markets    use    nowadays    very    powerful
____________________________(2 words) which allow banks and corporations to transfer
money____________________________________________(6 words).
3)   Banking   services   which   have__________________________(  3   words)   advanced
technology   include______________________(1   word)   like   electronic   letters   of  credit,
electronic  direct  debits  or even   international___________________________(2  words)
where paper doesn 't travel anymore.
7
4) Today companies need more_______________________(1 word) banking services such
as        bond        issues,        mergers        and        acquisitions,        corporate        restructuring
_____________________________(4   words).   We've   seen   a   substantial   increase   in
investment  banking  services,____________________________(3  words)  the traditional
banking services of the past.
TASK Complete the gaps with the words you hear. (Direct tapescript of one part of the text)
I: And what are going to be the new 1._______________________? You mentioned Internet
banking previously.
J: Yes, we've gone from a  2.__________________________________to a  new, banking
based on Internet. We've gone from what we call a '3.___________________________' retail
banking      to      either      '4.      __________________________      '      banking      or     a      '5.
____________________________'    banking.    The    '6.______________________________'
banking is a sort of banking where you are combining both the branches, the retail branch network, with powerful Internet banking services. But then you have banks which only operate
through Internet , this is what we call the '7.__________________________________' sort of
banking                                                                                                                                 activities.
8
Review Test
PJI4A
Market Leader: Unit 7 - Finance and banking
Name:					
Teacher:				TOTAL (60 points to pass)	MARK
Number of points (max. 100 points)					
I. Listening:		III. Grammar:			
II. Vocabulary:		IV. Translation:			
I. Listening: (max. 20 points)
points
II. Vocabulary: (max. 34 points)
points
A. Translate the following expressions into English:
podat žádost o ochranu před věřiteli u konkurzního soudu -
předběžné výsledky zahrnuté ve finančních výkazech —___
regulační rámce ovlivňující restrukturalizaci podniků —____
splatit jistinu a úrok držitelům dluhopisů —______________
(2 points each)
ochrana schválená soudem, věřiteli, akcionáři a správcem daně -
odečíst splatný úrok ze zisku před zdaněním —______________
odepsat dlužníkům pasiva kvůli snížení dluhu —____________
účetní hodnota zásob a odepisovaných aktiv —______________
B. Write expressions the following definitions refer to:
(2 points each)
1.     the relationship between the amount of money that a company owes (debts) and the value of its shares (equity):
2.     something that a company has and that benefits it but does not exist physically, for example
a brand or the company's reputation:
C Complete the sentence with one ofthefoUowingphrases; translate the selected phrase.                     (2 points each)
PROFIT AND LOSS ACCOUNT, STOCK OPTION, OVERDRAFT, ZENITH, CASHFLOW CONTROL, OPERATING PROFIT, LETTER OF CREDIT
1.    Because of its bad ________________________________________, the firm doesn't have
enough money available.
In C^ech or Slovak:_________________________________________
2.    The banks offers the possibility to use a(n)_____________________
if you want to withdraw more money that you have in your account.
In C^ech or Slovak:________________________________________
3.     Unfortunately, this program has reached its____________________________________and
now its quality will decrease.
In C^ech or Slovak:_________________________________________
D. Complete the sentences with correct forms of the following verbs; some verbs are not used:                  (1 pant each)
DIP - CONSERVE - WIND UP - OVERVALUE - BACK AWAY TERMINATE- CASH IN - OUTPERFORM - ACCOMPLISH
1.     Many investors want to___________________________their investments in a crisis period
because they regard money safer than shares.
2.     The hi-tech bubble was caused by irresponsible and unfounded______________________
the shares of technological companies.
3.     Our sales are higher than rivals' so we hope_____________________________them in the
next quarter.
4.     NBC's turnover_________________________a little last year but it is expected to rise again
this year.
E. Complete each sentence with a word made from the word given in brackets.                            (1 point each)
1.     It is not wise to invest in _________________________________; you should invest in
commodities instead. (SECURE)
2.     Deferring a payment is the last_______________________________our company is willing
to offer to you. (CONCEDE)
3.     The                                                       show us that our profit will fall by 20% this year.
(PROJECT)
4.     Low-cost_________________________have an advantage over national airlines. (CARRY)
III. Grammar: (max. 30 points)
points
A. Fill in the gaps with a suitable preposition or adverbial, if necessary:                                        (1 point each)
1.     Ford has staved_________bankruptcy thanks to an additional financial help.
2.     Mr Palmer is going to preside_________the next committee meeting.
3.     All out sources of money have dried_________, so we'll have to declare bankruptcy.
4.     The firm's bankruptcy has wiped_________all my investment.
5.     I wonder how the annual meeting is going to determine the dividends_________share.
6.     The government pays percentage interest_________bonds it issued.
B. Rennte the sentences with the given words and use the passive voice:                                        (3 points each)
1.     The OAK bank will repay all its debts. It will have done it by next December.
The OAK bank's_______________________________________________by next December.
2.     The company Jeff works for should have paid all his expenses.
Jeff__________________________________________________by the company he works for.
3.     I think it was not necessary for the company to raise, announce publicly and postpone the labor costs.
I think the labor costs needn't_____________________________________________________
C Put the VERBSandother words in brackets into their correct'forms, add prepositions, particles or
auxiliary verbs if necessary. You may need to use the passive forms of the verbs:                           (1 point each)
Money transfers____________________________________{BELIEVE, DECREASE) soon as
the financial crisis_______________________________________________{FORCE, consumers,
STOP, BUY) as many things as a few months ago. Banks_________________________________
_________________________(late, DECIDE, AVOID, PROVIDE) risky credits because they
____________________________________________{COULD, ACCUSE, BE) reckless by their
shareholders. Banks' managers think it's not worth___________
{RISK, EXPOSE) the lack of cash, and therefore their policy of _
Busines speople, on the other hand,_________________
DENY) financial means by banks. Some governments
{ENABLE, enterprises, ASK) loans has become very strict. __________________________________{COMPLAIN,
{MAKE, their banks, PROVIDE) loans by law recently, which ___________________________________________{OBJECT).
these banks strongly_________________________________________________
D. Choose suitable words or phrases that can complete each sentence. The number of correct answers is 0 — 4.
(2 points each)
1.     When are you going to____________________?
A: let your room painted                                    B: have cleaned the jacket
C: get your car repaired                                      D: have your new house built
The CEO____________________in a car accident.
2.
A: has had his wife killed C: might been injured
The company____________
B: should have been killed D: is going to be found dead
its biggest rival.
A: is believed to have been sold to C: is expected to be taken over by
B: was said to be bought from D: was known to be resisting to
IV. Translation: (max. 16 points)
points
Translate the following sentences into English:
Své finanční výsledky jsou firmy povinny každoročně zveřejnit ve výroční zprávě, která se skládá z několika finančních výkazů. V současné době je však stabilní finanční situace mnoha firem ohrožená a zdá se, že některé z nich buď požádají u soudu o ochranu, nebo zbankrotují. V takovémto případě by firma začala být řízena správcem konkurzní podstaty, který by dohlížel na ukončení všech činností firmy, splacení dluhů věřitelům a zlikvidování firmy.
Financial reporting
Maria Malone is the chief finance officer of a large international media company, based in the UK, with activities in television and publishing. She's talking to new trainees in the finance department:
'As with all companies, investors and analysts want to know how the company is being run and how their money is being used. Each year we produce an annual report with three key sets of figures:
■   profit and loss account              ■   balance sheet               ■   cashflow statement
These are the three key financial statements in financial reporting. They give the basic information about our financial results.' (They are covered in Units 34-37.)
The financial year
'Our financial year ends on March 31st, although other companies choose other dates. Soon after this, we publish preliminary results, or prelims. The full report and accounts are published a few months later. As a UK company, we also publish interim results or interims after the first six months of our financial year.'
Note: US companies publish their results every quarter. Shareholders, bondholders and lenders
'We use shareholders' money to operate and invest in the business. Some of the profit we make is paid out to them, usually in the form of dividends in relation to the number of shares that they each hold. Our shares are traded on the London stock market.
We also borrow money in the form of bonds. We pay percentage interest on those bonds and then later repay the principal, the amount of money originally lent to us. Our bonds are traded on bond markets.
And we borrow money from banks in the form of loans, on which we also pay interest.
Of course, our shareholders, bondholders and lenders all take a keen interest in our accounts!
The results we publish can affect share prices: good results cause prices to rise, if the market believes the company is undervalued. However, poor results often cause a drop in share price, as investors feel the company is overvalued.'
BrE: shareholder;
AmE: shareholder / stockholder
Business Vocabulary in Use (advanced)
33.1     Complete the crossword with appropriate forms of expressions from A, B and C opposite.
Across 3  Reports that are not for the full year. (8)
7   and 6 down What investors are basically interested in. (9,7)
8   One of the three key financial statements. (8,9)
11   Money lent by a bank. (4)
12   People and institutions that own bonds. (11)
13   The money you pay on a loan. (8)
14   See 2 down.
Down
1   Another of the three key financial statements. (7,5)
2   and 14 across Another of the three key financial statements. (6,3,4,7)
4   Together, these people and institutions are the owners of the company. (12)
5   Period of three months. (7)
6   See 7 across.
9 The publication of results: financial.................(9)
10  Banks and others that loan money. (7)
33.2     Complete the table with words from B and C opposite and related forms. Put a stress mark in front of the stressed syllable in each word of more than one syllable. (The first one has been done for you.)
Verb                                       Noun - thing                          Noun - person/organization		
'borrow	' borrow)/Virj	'borrower
finance		
lend		
33.3     Complete the sentences with appropriate forms of 'finance'. (There are two possibilities for one of the gaps.)
1   A millionaire................................donated a large sum to the charity.
2  The................................for the project is coming from two different sources: bank loans and a new
share issue.
3  The company must keep a careful control on its................................this year in order to avoid
making a loss.
Obtain the annual report of an organization you are interested in. (Many are available on the Internet at www.carol.co.uk. You can also use this source for other units on Company Finance.) Identify the profit and loss account (or the income statement), the balance sheet and the cashflow statement. What other information does the report contain?
Profit and loss account
Accruals accounting
Maria Malone continues:
'The accruals principle means that events in a particular reporting period, for example sales of goods or purchases of supplies, are recorded in that period, rather than when money is actually received or paid out; this may happen in a later period.'
Profit and loss
'The profit and loss (P&L) account records the money we make (or lose!) during a particular reporting period, using the accruals principle. In our case, our accounts record sales from books, magazines, television advertising, etc. during the period - this is the money received from sales, minus the labour and cost of materials used to produce them, which is called the cost of goods sold (COGS).
Then we take away selling and general expenses - the costs related to making these sales - employees' salaries, rent for buildings, etc. There is also the cost of depreciation - this is not an actual sum of money paid out, but is shown in the accounts to allow for the way that machinery wears out and declines in value over time and will have to be replaced. (See Unit 35) This leaves us with our operating profit.
Then we subtract the interest payable on money we have borrowed in the form of bonds and bank loans. This gives the profit on ordinary activities before tax, or pre-tax profit.
Sometimes there are exceptional items to report, for example the cost of closing a particular operation, but fortunately this does not happen very often.
Of course, we pay tax on our profits and in the UK this is called corporation tax.
Note: Sales are also referred to as turnover in BrE. The profit and loss account is called the income statement in the USA.
Earnings
'From the profit after tax, also referred to as earnings, we usually pay dividends to shareholders, and you can see the figure for dividends per share. However, when business is bad, we may not do this - we may omit, pass or skip the dividend.
Naturally, we don't pay out all our profit in dividends. We keep some to invest in our future activities - these are retained earnings, or reserves.
You can look at profitability in terms of earnings per share (EPS), even if some of these earnings are retained and not paid out in dividends.'
Match the words in the b ox to make expressions from A, B and C opposite. (The first one has been done for you.)
(accruals)^ interest reporting	periods payable"^-retained	exceptional \  operating expenses	earnings P&L	items        account profit selling and general
			^principle)	
Now complete each sentence with the correct expression.
1  Our financial year runs from 1 April to 31 March and is made up of two six-month
2  The company's................................................................has increased by 10 per cent this year.
3  We have decided to keep £25,000 from our profits as................................................................and not
distribute this to the shareholders.
4  One of the................................................................in the profit and loss account this year related to the
restructuring costs of our operations in Korea.
Read the profit and loss account for a UK company. Then look at A, B and C opposite and say if the statements below are true or false. All figures are pounds sterling.
he
,at8dig>n Manufacm,,
Profit and loss account for the year ended 31 March 20_    ■
Sales	900,000		
Cost of goods sold		560,000	
Selling and general expenses		120,000	
Depreciation		18,000	
Operating profit			202,000
Interest payable		15,000	
Pre-tax profit			187,000
Exceptional items*		57,000	
Corporation tax		60,000	
Profit after tax			70,000
Dividends		25,000	
Retained earnings			45,000
There are 100,000 ordinary shares. Earnings per share: 70 pence. Dividends per share: 25 pence. "This is for costs related to the closure of our offices in Stockholm.
1   The £120,000 for selling and general expenses includes the salaries of the salesforce.
2  The £18,000 for depreciation represents an actual amount of money paid out to suppliers.
3  The company has a bank loan and/or is paying interest to holders of its bonds.
4  £57,000 for exceptional items is probably paid out every year.
5  The company has paid out more to shareholders this year than it has kept for future investment and/or future payouts.
Over +o ipu    ^P                           ____
Obtain the annual report of an organization you are interested in. Relate what you find in the profit and loss account or income statement with the items in the table above. Then compare the figures with those for the previous year. What differences can you see?
Balance sheet 1
fixed assets
Assets
A company's balance sheet gives a 'snapshot picture' of its assets and liabilities at the end of a particular period, usually the 12-month period of its financial year. But the snapshot could be taken on any day of the year.
An asset is something that has value or the power to earn money for a business. Assets include:
1  current assets:
■   cash at the bank.
■    securities: investments in other companies.
■    stocks, of raw materials, unfinished goods and finished goods, that are going to be sold.
■    debtors: money owed to the company by customers.
2  fixed or tangible assets: equipment, machinery, buildings, land.
3  intangible assets: for example, goodwill, the value that the company thinks it has as a functioning organization with its existing customers, and in some cases brands (see Unit 26), because established brands have the power to earn it money, and would have a value for any potential buyer of the company.
However, there are some things of value that are never shown on a balance sheet, for example the knowledge and skills of the company's employees.
BrE: stocks, AmE: inventories; BrE debtors, AmE accounts receivable / receivables
Depreciation
Of course, some assets such as machinery and equipment lose their value over time because they wear out and become obsolete and out of date. Amounts relating to this are shown as depreciation or amortization in the accounts. For example, some computer equipment is depreciated or amortized over a very short period, perhaps as short as three years, and a charge for this is shown in the accounts. The value of the equipment is written down or reduced each year over that period and written off completely at the end.
The amount that is shown as the value of an asset at a particular time is its book value. This may or may not be its market value, i.e. the amount that it could be sold for at that time. For example, land or buildings may be worth more than shown in the accounts because they have increased in value. Equipment may be worth less than shown in the accounts because its value has not been depreciated by a realistic amount.
Computer equipment is usually depreciated over three years.
Note: The terms 'depreciate' and 'depreciation' are usually used in the UK; 'amortize' and 'amortization' are more common in the USA.
35.1     Complete the assets table for a UK company with expressions from A opposite, and the relevant figures, using the following information:
■    Paradigm has goodwill, in the form of hundreds of satisfied customers, worth an estimated £15,000. This is its only intangible asset.
■    It has investments of £6,000 in other companies.
■    It has raw materials, unfinished goods and finished goods together worth £3,500.
■    It owns equipment and machinery with a book value of £9,000.
■    It owns land with a book value of £31,000.
■    It has £11,000 in its accounts at the bank.
■    It owns offices and factories with a book value of £94,000.
■   Various people and organizations, including customers, owe £7,500.
^adigm Manufactory
Balance sheet at 31 March 20
ASSETS
Cash			
	6.000		
			
			
Total current assets		28,000	
	94,000		
			
			
Total fixed assets (book value)		134,000	
			
Total intangible assets		15,000	
TOTAL ASSETS			177,000
^
35.2     Using the information in B opposite and in the table above, decide if these statements about Paradigm's assets are true or false.
1   The figure for equipment and machinery is the price it was bought for, written down by an amount for depreciation.
2  The figure for equipment and machinery shows that it has been written off completely.
3  The figure for land and buildings is the exact amount they could definitely be sold for.
4  The figure for goodwill is an objective value of the customer base that a buyer of the company would definitely agree to pay.
Think of an organization you are interested in. What are its main assets? Which of them could be shown on its balance sheet?
Balance sheet 2
tm, i O' Sul i  I I   li, j %~. v3
A company's liabilities are its debts to suppliers, lenders, bondholders, the tax authorities, etc. Current liabilities are debts that have to be paid within a year, for example:
■   creditors: money owed to suppliers etc.
■   overdrafts: when the company spends more money than it has in its bank accounts.
■   interest payments that have to be paid in the short term.
■   tax payable.
Long-term liabilities are debts that have to be paid further into the future, for example long-term bank loans and bonds.
BrE: creditors;
AmE: accounts payable or payables
Shareholders' funds
When you deduct a company's liabilities (everything it owes) from its assets (everything it owns), you are left with shareholders' funds1. In theory, this is what would be left for shareholders if the business stopped operating, paid all its debts, obtained everything that was owed to it and sold all its buildings and equipment.
Shareholders' funds as shown in a company's accounts includes:
■   The share capital2 the shareholders have invested.
■   The profits that have not been paid out in dividends  to shareholders over the years, but have been kept by the company as retained earnings, also called reserves.
BrE: shareholders' funds
AmE: shareholders'/owners' equity
36.1     This is the other half of the balance sheet in Unit 35. Complete the assets table with expressions from A and B opposite, and the relevant figures, using the following information:
■   Paradigm has a bank loan of £20,000 to be repaid in three years.
■   It has issued £100,000 worth of shares.
■   It has issued bonds for £30,000 that it will have to repay in seven years. M   It has retained earnings of £10,500.
■I   It has to pay £3,500 in interest on its bank borrowing and bonds.
■    It owes £5,000 in tax.
■    It owes £6,000 to suppliers and others.
■    On one of its bank accounts, Paradigm has spent £2,000 more than it had in the account.
HB
>»<
ad'igm Man*>1actur,
ins
Balance sheet at 31 March 20
LIABILITIES
	6,000		
			
			
	5,000		
Total current liabilities		16,500	
Bank loan repayable in 3 years			
			
Total long-term liabilities		50,000	
			
			
Shareholders' funds		110,500	
TOTAL LIABILITIES PLUS SHAREHOLDERS' FUNDS			177,000
36.2     Using the information in B opposite and in the table above, decide if these statements about Paradigm's liabilities are true or false.
1   The creditors item includes debts that will have to be paid in two or three years.
2  Overdrafts are a form of long-term loan.
3  In the coming year, Paradigm will have to pay more tax than it pays out in interest on its loans.
4  Paradigm has borrowed more in the form of bonds than in the form of bank loans.
5  Share capital of £100,000 is the current value of Paradigm's shares on the stock market.
6  Retained earnings is the total of all the dividends that have been paid out to shareholders over the years.
Obtain the annual report of an organization you are interested in. Relate where possible the items on the liabilities side of its balance sheet with the items in the table above.
UNIT EIGHT - CONSULTANTS
Listening; 8.3., p.
First of all, 1._____________________________(2 words): if potential
buyers know that you have the power to make big concessions on your own, then they may get angry if they can't get what they want. If you say:        '        I'm       sorry,       I'm       going       to       have       to       2.
__________________________________ (3 words)  my boss, ' then  if
you refuse the concession, some anonymous authority will be responsible, not you. You should maintain a good relationship, so that you can either continue to negotiate or come back to them at a later day. Next we have avoiding            endless            negotiations,            where            you            3.
__________________________________________      (5      words).      4.
_____________ (1 word)  negotiators will  usually start out with small
concessions,      like      a      one-per-cent      discount,      and      then      5.
_________________ (1 word) to large ones.  But this just makes the
buyer feel as the concessions get bigger, there's more to come. Even if it all     ends,    the    customer    will    feel    there    was     more    they    6.
___________________    (3    words).    They    don't    feel    good    about
negotiations. Professional negotiators, however, give their biggest concession first. As the negotiation continues, the concessions that they grant  will  get smaller and  smaller.   When   it's  over,  the  buyer feels
they've   got   you   7.   ______________________________________   (5
words). Keep in mind that in 8.____________________(2 words)
negotiations, you want the customer to feel as though they're a winner, too. You also want to ovoid long discussions that are a waste of everybody's      time.      Then      there      is      the      negotiation's      9.
________________________(2 words). What do you know about your
10. ______________________ (1 word)  needs, wants and  problems?
What is your original asking price? Is it high enough? What is your bottom line or walk-away number?
Your bottom line is the 11.________________________(2 words) that
you    were    anticipating.    It's    sometimes    called    BATNA,    the    12.
(6     words).      BATNA      represents     the      point     at     which      13.
(9 words). So, if you have to go below your bottom line, it's time to walk away.     The     real     secret     of    good     sales     negotiations     is     14.
_______________________________(3 words) in advance what you can
ask for 15.______________________(3 words) a price cut. Remember
that buyers, like everyone else, tend not 16. ______________ (1 word)
value anything they get for free or can get easily.
TASK Complete the sentences with the words/phrases from the listening exercise.
1.    Once    a    company    has    identified    a    problem,    consultants    can
___________________________  _____(3  words)     the   exact  task  of
consultancy.
2.  Consultants need to establish objectives and principles. Here they often
_______________________       (2   words)    SMART   which    stands   for
___________________________________________________  (4  words)
and    __________________(1    word).    Clients    need    to    establish    a
_______________  (1   word),   a   budget  and   a  ________________  (1
word).
3.  To choose the best consultant, you come up with a_________________
(1 word) and ask them to__________________________(3 words).
4.   Once  you   have  _____________________  (1   word)   one   of  these
consultants,  you  need  to __________________________ (2 words)  a
written contract.
5.       The       contract       needs       to       contain       information       about
______________________(1 word), i.e. the goods and services that are
going to be delivered.
15
6. Fees usually__________________ (2 words) one or two types. The
main                      difference                      lies                      in                      the
___________________________________________(6 words).
7.______________________________(3 words) contract the consultant
______________________________________(3 words).
8.     The    company    hiring     consultants     has    to     make    sure    the
____________________ (1 word) between them and the consultant is
right.
TASK Complete the gaps with prepositions if necessary.
1.  What about overseeing_____the work?
2.  What delieverables have you agreed________?
3.  What problems are consultants coming__________?
4.  It's best if the consultant reports_________just one person.
5.  Some staff are resistant_________change.
6.  Some critics say consultants just snoop _______and only produce a
report telling you something you already know.
snoopl/B snu:p/A verb [intransitive]; čmuchat, slídit
1             to secretly try to get information that someone would not want you to have: She's been snooping round asking questions.
Somebody went snooping through my desk while I was gone.
2            snoop on to watch someone secretly in order to learn about their personal life or business:
I hear they use detectives to snoop on employees. -           snooper noun [count] -fizl
TASK Based on the text answer the following questions:
1.  Explain the expressions a) " money for an old rope", b) jack in their ordinary jobs
2.  Which industries tend to spend most money on consultating services? What do they expect from consultants?
3.   As consultancy business is relatively young, it tends to be less competitive than other businesses. T/F
4.  Which employee target groups do consultancy companies usually try to attract and how? What do they want in return?
5.  What strategies may some consultants be using to get more business?
6.  Explain the expressions "unscrupulous" and "with hindsight".
7.  How do clients sometimes put pressure on consultants?
8.  Explain the expression: some companies are "high maitenance".
9.  Why can an inexperienced client find himself in a situation where they are paying a huge fee for substandard services from consultants? How does the industry protect itself from underperforming consultants? Why is the existing protection still insufficient?
10.   What general tendency in busines today has made it easier for consultancy business to thrive?
11.  It's not easy for a client company to choose a suitable consultant. T/F
12.  Give an example of consultancy service which worked extremely well and failed in two projects assigned by the same company.
16
Review Test
PJI4A
Market Leader: Unit 8 - Consultants
Name:					
Teacher:				TOTAL (60 points to pass)	MARK
Number of points (max. 100 points)					
I. Listening:		III. Grammar:			
II. Vocabulary:		IV. Translation:			
I. Listening: (max. 20 points)
points
II. Vocabulary: (max. 34 points)
points
A. Translate the following expressions into English: propracovaná procedura jmenování generálního ředitele -problém odvíjející se od shody se specifikacemi —_____
ustoupit ve způsobu měření manažerského výkonu ■ milníky obsažené v časovém rámci —____________
amatérští a úmyslně bezohlední vyjednavači -
ostranění odchylek s přesností na zlomek milimetru -nadbytečná, ale uspokojivá požadovaná cena —____
instrukce obsažené ve smlouvě za pevně stanovenou cenu -
B. Write expressions the following definitions refer to:
(2 points each)
(2 points each)
3.            the act of balancing two things that you need or want but which are opposed to each
other:
4._______something that you allow or do, or allow somebody to have, in order to end an
argument or to make a situation less difficult:
C Complete the sentence with one ofthefoUowingphrases; translate the selected phrase.                        (2 points each)
COMMITMENT-MONEYFOR OLD ROPE-CUSTOMER DEUGHT-HINDSIGHT MONEYSPINNER -RETAIL BANKING -INCREMENTAL IMPROVEMENTS
4.             Writing         up         the         report        was        very        easy,        so        it        was ______________________________________for me.
In C^ech or Slovak:______________________________________________
5.             The             Windows             operating            system            has            been             a ________________________________________for Microsoft because so many people use
it on their computers.
In C^ech or Slovak:______________________________________________
Let's   focus   on   __________________________________________________   of  our
computer systems rather than doing everything from the beginning.
In C^ech or Slovak:______________________________________________
D. Complete the sentences with correct forms of the following verbs; some verbs are not used:                    (1 pant each)
WALKAWAY- CONCEDE - TOUT FOR - TAKE OUT- GRANT HOLD BACK-PARE BACK-APPOINT-JACK IN- TAKE ON
5.             My friend has promised me_______________________an additional business which
could bring me more money.
6.             The   bad   economic   situation   forces   us   _____________________________   our
organizational structure and dismiss several workers.
7.             Stop ______________________________ the process of restructuring — we need to
start the production as quickly as possible.
8.             Toyota is considering__________________________ the development of their new
model because the demand seems to be falling rapidly.
E.  Complete each sentence with a word made from the word given in brackets.                               (1 point each)
5.             Removing      levels      of      management      is      sometimes      referred      to      as _________________________ (LAYER)
6.             Every   decision   you   make   is   subject   to   the   boss's   _______________________.
(APPROVE)
7.             Don't forget to mention all the ________________________________ the project
includes. (DELIVER)
8.             There  are  many young  and  ambitious  ______________________________ in  this
company. (ACHIEVE)
III. Grammar: (max. 30 points)
points
A. Fill in the gaps with a suitable preposition or adverbial, if necessary:                                        (1 point each)
7.                 Stop holding back__________producing your reports, we need them.
8.                 Our commitment__________change is obvious and well visible.
9.                 A trade-__________means offering something in exchange for something else.
10.               I'm not going to fulfill your needs one__________one.
/ /.              Let me run this__________my superior and then I'll let you know.
12.              This project will not get__________the ground because it is too costly.
B. Rewrite the sentences with the given words and use conditional clauses:                                    (3 points each)
4.                             It is unfortunate that they didn't offer me the job a month ago.
I wish I________________________________________________________________________.
5.                             Unfortunately, the financial crisis didn't start two months later. It wouldn't be necessary for us to dismiss 200 workers in these days.
If
we
6.                          Fortunately expense reports are filed via the intranet, so they can be paid
within 48 hours.
If expense reports_____________________________, they_____________________________.
C. Put the VERBSandother words in brackets into their correctforms, add prepositions, particles or
auxiliary verbs if necessary. You may need to use the passive forms of the verbs:                           (1 point each)
The consultants___________________________________________(late, POSTPONE, DEAL)
the major issues of their client. Instead of_____________________________{RECOMMEND,
WRITE) a report on the development of production, the consultants_______________________
______________________[URGE, the client, LEAK) some confidential information about their
foreign operations. The consultants
{TRY, MAKE, their employees, GIVE OUT) this information, which
quickly. They
. {CONSIDER) unethical behavior by the management. Managers
_________{DISAPPOINT, HEAR) such news and have reacted
_____________________________________{REFUSE, GO ON,
COOPERATE) the consultancy. They .
{AVOID, PROPOSE, SUE, they) because settlement out of court________________________
{SEEM, BE) a better idea.
D. Choose suitable words or phrases that can complete each sentence. The number of correct answers is 0 — 4.
(2 points each)
4.                If I_____________________you, I_____________________.
A: was ... would accept the offer                        B: had been ... would have gone there
C: were ... would have sold the car                     D: was ... could do it
5.
If
you.
a ball, it
gravity.
A: drop ... will fall
C/had dropped ... would fall
If Jack_______________
B: will drop ... will fall D: drop ... falls
because of
, he
A: had been born earlier ... could vote now
B: hadn't been killed ... wouldn't be dead now
C: was clever ... would have passed the entrance exam
D: was a woman ... couldn't have been interested in football
IV. Translation: (max. 16 points)
points
What is quality?
Defining quality
Staying in the lead means continually raising the bar
In 1980, a television documentary in the US entitled If Japan Can, Why Can't We? announced that it had discovered the secret of Japanese competitive success: quality. Japanese companies were successfully dominating world markets because they had a quality system that allowed them to produce better products than their US rivals.
What was more, the documentary said, the Japanese had learned this
quality system from US experts such as W Edwards Deming and Joseph Juran. What US and other western businesses had to do now was relearn the techniques of quality management. The central problem revolves around an understanding of what 'quality' is and how far the concept can be applied across the organisation. Definitions can vary, but it is generally accepted that the three  elements  which  constitute
quality are fitness of the design, conformity to specification and satisfying customer needs.
Today, quality is most often defined by the reaction of the customer who buys and uses the product. If the customer is satisfied, so the theory goes, the product is of sufficient quality. However, a strategy based on no more than meeting customer expectations is a dangerous one, as it opens the door to rivals that may produce better products.
Financial Times
;:i?;:s::;:;::;'';:;/;;.} ;;::™;ur:iif;;::;!vi;;;
""•"'
Note: Specifications are referred to informally as specs.
Quality in manufacturing
Gordon Greer is head of quality at a car component company:
'The design for each component embodies the intentions of its designer. So conformity to specification means putting these intentions into practice when we make the components. Put another way, this is elimination of variation.
We pay great attention to accuracy. The components must be made to very strict tolerances - the measurements must be not more or less than particular limits to within a fraction of a millimetre.'
Quality in services
Serena Togliatti is customer relations manager at a large bank:
'In services, there is a parallel situation to the one in manufacturing. The service received by the customer must be exactly what is planned and intended, and annoying mistakes, for example in their accounts, must be avoided.
From the customer's point of view, quality could be defined in terms of customer approval, that is, recognition that we are satisfying customer needs and customer expectations. And if we exceed those expectations, there may even be customer delight.' (See Unit 23)
	»■)
A micrometer
10.1      Look at A and B opposite and answer the questions. Which expression refers to:
1   the idea of following a designer's intentions?
2  the work of making sure that the principles of quality are applied?
3  approaching quality in a logical way?
4  keeping customers happy?
5  how good a design is for the purpose of the product it relates to?
10.2      Complete the table with words from A, B and C opposite and related forms. Put a stress mark in front of the stressed syllable in each word of more than one syllable. (The first one has been done for you.)
	
a'pprove (of)	a'pproval
conform (to)	
	delight
eliminate	
expect	
fit	
	satisfaction
specify	
	tolerance
vary	
Now use correct forms of the expressions above and opposite to replace the underlined words and phrases in this memo from the head of a package holiday company.
The management of change
Business process re-engineering
In the 1990s, business process re-engineering, or BPR, emerged. Inspired by a book by Michael Hammer and James Champy1, consultants told companies not to bother with incremental improvements, but to abolish everything, go back to the drawing board and redesign all the business processes involved in producing something, whether a product or a service. They said that this redesign should be:
■    fundamental: asking basic questions about what a process is meant to achieve
■   radical: going to the root of things and ignoring completely how things were done before 'like starting again with a new sheet of paper'
■   dramatic: bringing about very big and sudden changes.
In the eyes of critics, BPR often meant delayering - removing management layers, perhaps resulting in job losses.
The benefits of BPR
For its supporters, these are some of the strengths of BPR:
a leadership: strong leadership is important; changes are imposed from above; there is visible
commitment from leaders for change b people management: fewer management layers mean larger, more challenging jobs C policy and strategy: clearer fit between the organization and its declared purpose and goals d processes: managers and employees gain improved awareness and understanding of key
processes e customer satisfaction: clear focus of processes on the customer for existing products and
services f business results: dramatic improvements for companies in crisis. (The headings are from the EFQM Model - see Unit 13)
1 Re-engineering the Corporation: A Manifesto for Business Revolution (Nicholas Brcaley 2001)
Gordon Greer, production manager at a car components manufacturer (see Unit 10) is talking about a car company that he supplies called Autoco. Replace the underlined words and phrases with expressions from A opposite. Pay attention to the grammatical context.
'One example of (1) restructuring that I know was quite (2) basic: Autoco, one of our customers, wanted to simplify its supplier payments system.
Before, there were three documents relating to every delivery. We got a purchase order from Autoco, a delivery note accompanied the goods when they were delivered to them, and then we sent an invoice. There were 300 employees in their accounts department. Within the department there were sub-departments, each dealing with payments for different groups of suppliers, and each with its own head.
The accounts payable department at Autoco checked that copies of the three documents matched before making payment - there were often problems with documents, and this delayed payment, which caused us problems.
Autoco made a (3) very big and sudden change, one that was (4) designed to go to the root of things. When goods were received, this was entered on Autoco's computer system, and the goods were paid for automatically - we no longer had to send invoices, and were paid promptly.
The number of people in the accounts payable department at Autoco was reduced to 15. There was (5) a reduction in the number of management layers as the sub-department heads were no longer needed, but the company was expanding elsewhere, and the people who were no longer needed were given new jobs within the company, so there were no (6) employees made redundant/
Look at these criticisms (1-6) that have been made of BPR. Match each criticism to one of its claimed benefits (a-f) in B opposite.
1   Results may be harmed by the chaos and confusion that BPR brings to the organization.
2  People can be left demotivated and demoralized by radical change.
3  Smooth, gradual, incremental introduction of completely new processes is not possible.
4  If the company is in crisis, there can be a tendency to concentrate too much on the internal workings of the organization and lose sight of the actions of competitors, and the success/failure of the organization's strategy.
5  The need for BPR implies bad earlier management, but the existing senior managers hardly ever want to re-engineer themselves out of a job.
6  There can be a tendency to concentrate too much on the existing products/services of the organization, ignoring new customer needs.
You have been asked by the mayor of your town or city to re-engineer one of its services. Which service most needs improving? How would you restructure it? (Money is no obstacle!)
UNIT NINE - STRATEGY
Reading, p. 80
TASK Complete the terms/words/phrases defined by the following. The items appear in the same order as in the text.
1.   __________________________  =   an   improvement  on  the  quality,
price, etc. of a product
2.___________________= to use all the money, resources, etc. that
someone or something has available
3._____________= someone who other people respect and go to for
advice about a particular subject
4.________________________= searching for something that you have
lost, need, or want
5._____________= to encourage strong emotions or behaviour in people
Newspaper articles have___________fears of the new tax policies.
6.__________________= famous, known and admired for
7.___________________= additional objects, equipment, decorations etc
that make something more useful or attractive
8.______________= able to judge people and situations very well and
make good decisions,
a__________marketing strategy
9._______________= to completely change the way something is done,
thought about, or made
10._________= very cheap
high quality goods at_____________prices
11._____________= to make you start feeling or thinking about
something that you have not felt or thought about for a long time
This journey has_______________some old memories forme.
12.___________________= to claim that sth is true
Critics of the school system___________________not enough emphasis is placed
on creativity.
13.________________=   {in the text you have the noun form of this
adjective) next to or near something else
The site of the new building is_________________________the park.
14.__________________= to make something seem less good, attractive,
or important
We should not allow her personal difficulties to_____________________her public
achievements.
15._________________= a thick strong upright post that supports part of
a building; someone who is important and respected within a group
Mr Henderson is a__________________society.
16.____________________= a careless or embarrassing mistake
Officials were accused of making a huge administrative__________________.
17._____________________= to not happen in the way that was hoped
or planned
18._________________________= something that gets your attention
and prevents you from concentrating on something else
We have work to do and it is essential that there are no________________________.
19.____________________= something that makes something else
develop or progress more slowly
High interest rates are______________________the housing market.
20.___________________= very large
21.___________________ = to stretch over or across something in an
ugly and untidy way
22._____________________= a substance that allows some electricity to
pass through it, used for making electronic equipment such as computers
23._______________________= a small or unimportant position in a
place, organization, or activity that you hope will help you to get a better one
24._____________________= a short period that you spend doing only
one activity, especially something enjoyable such as spending
25._______________= less healthy or happy than you were in previous
times:
21
Listening; 9.4., p. 85
TASK Complete the gaps with the words you hear:
It's clear from the feedback that I got from our customers that we have a problem       with       our       brand       image.       They       see       us       as
1._____________________. What's more, they say that our catalogues
are unattractive and they feel just, well, 2.________________________
by    the    number    of    products    we    offer.    There    could    be    a    3.
__________________________reducing the range of products. Let's face
it, we have a lot of lines that really aren 't great 4.___________________.
We could  5. ___________________________ many items,  as well,  by
producing more global and, uf, fewer regional products. As you can also see in my report, our customers often complain about the poor quality of our products and they say there's a lack of interesting new lines. Then we
have what our sales reps 6._____________________. I really discovered
7.      _______________      the      types      of      obstacles      our      reps
8._________________- and I'm talking about very basic things like, uh,
not being able to 9.______________popular items and not receiving the
correct   items   ordered.    We   definitely   have   to   work   on   our   10.
__________________________and distribution systems. And our ordering
procedures are as oldfashioned as our image! I mean what's with those
40-page order forms you gotta 11._______________________and mail
to the office? Our own estimates show that orders aren't properly filled 30% of the time! It makes it difficult for agents to increase their sales,
and, uh, 12.___________________________and for us to, uh, keep our
reps. For me, recruiting and retaining sales reps has got to be a priority. Now,        I'd        appreciate        your        feedback        on        my        13.
22
Strategie thinking
Strategy
A strategy (countable noun) is a plan or series of plans for achieving success. Strategy (uncountable noun) is the study of the skills, knowledge, etc. required to make such plans. Strategic success in a commercial organization is often measured in terms of profitability, the amount of money it makes in relation to the amount invested.
An important part of planning is resource allocation. This is the way finance, people and assets - equipment, buildings, know-how, etc. - are going to be used to achieve a particular objective.
A company's senior executives make strategic decisions or formulate strategy. Sometimes
an organisation will publicly state its main overall objective or vision in its mission
statement.
Companies sometimes form strategic partnerships, working together to achieve a specific
strategic goal. For example, MG Rover entered a partnership with a Chinese car
manufacturer to enable it to produce and sell cars in China. A company may also make a
strategic move, such as acquiring a competitor, designed to increase their market share.
Companies and markets
Company A dominates the market. Company B has a toe-hold in the market. Company C is attacking the market. Company D is withdrawing from the market
When a company ...		
a defends		tries to prevent competitors from being successful in it.
b attacks		starts selling in it for the first time.
c establishes a foothold/ toehold in	a market, it	occupies a small part of it first in preparation for gaining a larger part.
d invades		starts to be very successful in it.
e dominates		is the biggest competitor in it.
f withdraws from		stops selling in it.
1 6.1     Look at the questions from shareholders at the annual meeting of Topaz, a car company.
Complete the chief executive's answers with appropriate forms of expressions from A opposite.
Why has the company bought out its rival, Rivera?
^^
2 r
Some of Topaz's plants have very low productivity. What are you doing about this?
Why are you closing one of the plants?
Was this the only goal that was considered? Did you also look at the possibility of being a mass producer of vehicles?
This was a..............................................................to
broaden our customer base.
^^
We have taken steps to ensure that our...............................
are used more effectively. This is an important part of our strategic...............................process.
—^                                            —;
This is an issue of...............................................................We
don't have infinite financial resources and we want to concentrate investment on the most productive plants.
We looked at a number of different.............................
and decided that the hi-tech option was the best one to follow.
1 6.2     Match the underlined phrases below to the expressions in B opposite that refer to the same idea.
Cofféeway (CW) is a successful American chain of coffee shops. It wanted to (1) aggressively
enter the Chinese coffee shop market,
with shops all over China. CW signed
an agreement with a partner, Dragon
Enterprises (DE). CW and DE decided
to (2) start by opening just one coffee
shop in Shanghai in order to test the
market. This was very successful, so
CW and DE decided to open shops all
over China. It took CW and DE five
years to (3) be the biggest in the
market, with a 70 per cent market
share among coffee shop chains in
China. One of their competitors,
California Coffee, tried to (4) protect
its market share by cutting prices. But
this strategy did not work, and California Coffee later sold its outlets to CW/DE and decided to
(5) leave the market.
Over ko ipu
Think about your organization or one you would like to work for. Look at its website and find its mission statement. If it doesn't have one, what would you suggest?
Key strateqic issues
Industries and their players
In some industries, like steel or tyres, there are few companies: these industries are concentrated. Other industries are fragmented: for example there are millions of restaurants worldwide, and even the largest chain, McDonalds, only has a market share of less than one per cent in terms of all restaurant meals served worldwide.
Some industries have low entry barriers - anyone with a small amount of capital can open a restaurant.
If an industry has low entry barriers and is attractive because of its high potential profitability, there will always be new entrants. This was the case for Internet service providers at the turn of the century with a lot of companies offering this service.
Other industries, like steel, require massive investment in equipment, know-how, etc. -these are high entry barriers and new entrants to the industry are rare.
Some companies are very acquisitive, buying competitors in their industry or companies in other industries in a series of acquisitions or takeovers, which it may refer to as strategic acquisitions. Or a company may merge or combine as an equal with another company of similar size.
A company may also buy its suppliers and customer companies in a process of vertical integration.
The result of this may be an unwieldy conglomerate, a holding company with a large number of subsidiaries, which may not be easy to manage profitably as a group.
Make or buy?
Recent strategic thinking holds that conglomerates are not good. Many conglomerates have disposed of or divested their non-core businesses, selling them off in order to concentrate on their core business. This is related to the make or buy decision, where companies decide whether to produce particular components or perform particular functions in-house or to buy them in from an outside supplier. (See Unit 4)
Note: The nouns relating to 'dispose' and 'divest' are 'disposal' and 'divestment'. They can be both countable and uncountable nouns. (Compare "divestment" with "investment".)
Complete the crossword with appropriate forms of expressions from A, B and C opposite.
Across
7   and 4 Things that make it difficult to get into an industry. (5,8)
9 When a company sells a business activity. (10)
11   See 10 down.
13   If an industry is difficult to get into, entry barriers are.................(4)
15 A large group of different businesses. (12)
Down
1   A large industry with not many companies is.................(12)
2   When two companies join as equal partners, they.................(5)
3   A company's most important business activity: its................business. (4)
5   A company that buys a lot of other companies is.................(11)
6   A large industry with lots of small competitors is.................(10)
8   A profitable industry that companies want to get into is................. (10)
10  and 11 across When a company buys its suppliers or customers (8, 11)
12   In a fragmented industry, each competitor only has a small market........
14   If an industry is easy to get into, entry barriers are.................(3)
w		D —I I	
	-i		
ŕ			
	\	■        i	
	T      1     :		
	í       c>                10		
			
! 1	i.'		
U    -	-     E 3 E c: B 14		-JJ
i	----L±±±		-
.(5)
An executive in a consumer goods company is talking. Complete what she says with expressions
from A and B opposite. (There are two possibilities for one of the gaps.)
'We make a wide range of consumer goods. Over the years we have made a number of
(1)................................................................, buying companies that fit in with our long-term plan of
being the number one consumer goods company in Europe. These (2)................................
mean that we now own a large number of (3)................................, each with its own brands.
We have become an (4)................................................................, and all this is very difficult to
manage. So we are now reducing the number of brands from 300 to 100, and getting each unit of the company to concentrate on our long-term goal, which is increased (5)
................................and therefore better results for our shareholders. And our increased power
will certainly dissuade new (6)................................from coming into the industry, so our
position will be further strengthened.'
Over -to tpu
Think of a recent merger or takeover. What benefits were claimed for it at the time? Have they materialized?
Innovation
Innovation and the development process
Enrique Sanchez is head of new product development at a large consumer products company:
'We want to foster creativity and innovation - the development of new ideas. Ours is a large company, but we want to avoid becoming bureaucratic, with slow decision making. (See Unit 1)
We encourage corporate venturing and intrapreneurship, where employees develop entrepreneurial activities within the organization, working on their own projects outside the usual frameworks; we allow them to spend 15 per cent of their time on this. We set up skunk works, away from the main company sites and outside the usual structures, to work on innovations. This is the way we do our new product development. The most famous example of this was IBM, when it developed its PC away from the company's main research and development sites.
We firmly believe that companies have only two basic functions: innovation - developing new products and services - and marketing them. Our marketing people are heavily involved in new product development. They get the reactions of focus groups - groups of consumers who say what they think of the product - at a very early stage in the development process.'
Pioneers and followers
'One problem is to know whether to introduce a product or service before anyone else, or to wait for others to introduce similar products. Some say that if you bring a product to market first, you have first mover advantage - you can influence the way the market develops. These companies are trendsetters or innovators. Others say that it's better to be a follower and learn from the mistakes of the pioneers.'
Note: 'Pioneer' is also a verb.
Shakeout and consolidation
A new or emerging industry, perhaps one based on a new technology, can be attractive -the future structure of the industry is not yet established and there is room for many competitors. But as growth in the new market slows, smaller competitors with higher costs can no longer compete. They drop out or are bought by the larger companies in a process of shakeout and consolidation, leaving the larger companies with the resources to dominate the industry, which is now mature.
20.1     This article contains words from A opposite. Complete it by choosing the best phrase (a-d) below to go in each of the gaps (1-4).
20.2
20.3
INTRAPRENEURSHIP
Increased  global  competition  is      1960s,  the  concept  fell  out  of     innovation is forcing Britain's large
forcing     large     companies     to     favour in the mid-1980s. Fostering     companies to look for methods to
consider more venturesome ways     different   cultures   in   the   same     stimulate ideas for new products.
of stimulating product ideas                organization   has   proven   to  be      (4)   ................................  companies
As   a   theory,   intrapreneurship.     difficult,  while remuneration has      through  corporate  venturing and
where large established companies     also been a problem.                           intrapreneurship may be given new
turn to internal 'entrepreneurs' for     Intrapreneurship  seems  to  have      life  in the UK.   'Too many UK
breakthrough innovations, sounds     been perceived to be more effort     companies  used  to  lack  global
like a good idea. On the surface.     and pain than it was worth. There is      ambition, but now, those who want
nothing can be more efficient than     an   increasing   recognition   that     to compete internationally realize
(1).................................                         (3) ................................ Most of the      that they need to innovate,' says
In practice, things have not been     corporate venturing activity in the     Jim Martin, director of technology
that  easy.   (2)   ................................     past has been centred around US      investment   at   3i.   the   venture
many    companies    which    have     companies, and the concept never     capital group,
ventured    into    the    world    of     really   caught   on   in   the   UK.
intrapreneurship have failed to reap     But   increased   competition   in
any benefits. After its birth in the     global markets and the pressure for
Financial Times
•    mtrntf-
a The push for innovation among large
b encouraging innovation among employees so that they come up with mould-breaking
products and ensure the company's survival. c the nature of big companies is to stifle innovation and entrepreneurship, hampering their
performance in the global arena. d Apart from a few examples of success,
Complete the sentences with appropriate forms of expressions from B opposite.
1   The alliance put ARM in partnership with Psion, the early................................of pocket-sized
computers.
2  Freeserve was the first Internet service provider to drop upfront charges and, with this ................................................................................................, came to dominate the UK market.
3  But when one company................................a successful business, competition inevitably intensifies.
Consumers benefit from the resulting cuts in prices and improvements in quality.
4  So far Taiwan has always been a................................, making things invented elsewhere more
cheaply.
Look at the following facts about the development of the market for online book sales. (They are not in chronological order.) Complete the facts with appropriate forms of expressions from C opposite.
1   Some smaller companies stopped selling altogether: they ...
2  There is a trend towards fewer and bigger companies in the market, a trend towards ...
3  Amazon and a few others lead the industry: they ... it.
4  The market is no longer young: it is now ...
Over +o tpu
Is it always difficult for large organizations to come up with innovative ideas and products? How does your organization, or an organization you would like to work for, produce new ideas?
UNIT TEN - DOING BUSINESS ONLINE
Listening; 10.1., p. 90
TASK Complete the text with the words you hear. There are always two words per gap.
1 It's so convenient. There is virtually no queuing any more, especially if
1  only have hand luggage. I just put my credit card in a machine when I
get to the terminal, and, er, it prints out a a}__________________, and
then I go straight through the b}___________________________._
2  It makes sense, I think, to download this stuff from the Internet. It's so easy    to    update    my    anti-virus    scan.    I've    had    to    buy    a    cl
____________________,   too,   because   my   computer  was   working   so
slowly. Their customer service isn't good, though. It's really frustrating
sometimes, not being able to phone a real ď)__________________about a
problem. You have to read ej___________________and send e-mails that
never get answered.
3  I live a long way from home, and it's always been a f)_______________
stuff to people. But thanks to this website, I can now choose something I think they'll like.... and there are lots of recommendations on the site, gl __________________and JV)______________________. The danger is I
always  ü.
spending more than I planned to.
.getting   myself  something,   too,   and
Reading, p. 92-93
TASK Find in the text expressions defined by the following:
1.   ________________   =   from   the   Greek   Kuߣpvh.Tn.c,   (kybernětěs,
steersman, governor, or pilot) — is the global domain of electro-magnetics accessed through electronic technology and exploited through the modulation of electromagnetic energy to achieve a wide range of communication and control system capabilities.
2. _____________ = a  business that sells goods to the public on the
Internet
3._______________= sth which makes you unable to concentrate on sth
4.__________= smoothly, fluently
______ = a line along which two edges, esp of cloth, are joined or
sewn together
5.   __________   =   a)   watching   or  controlling   sb/sth,   supervision,   b)
unintentional failure to notice sth
6._____________= often changing, not constant
7. _____________ = ready and willing to forget about sth bad which has
been done to you, ready to stop being bitter towards sb or about sth, ready to stop blaming or wanting to punish sb
8. ______________= never having happened, been done or been known
before
9.______________= (cause sb to) go away or separate from sb
10. ________________ =    to add up to or total sth, to be equal or the
equivalent of sth
The cost______________£250.
Our information doesn 't___________much.
11. ____________________ = when everything else has been taken into
consideration
______________________ the new manager is no better than the
previous one.
12.  (in) stock =  the goods that a business has for sale at a particular time We have a fast turnover of__________.
That particular model is not currently in_________.
I'm afraid we're temporarily out of________.
13.__________________    = to put or take sth somewhere quickly and
suddenly
_______________ = to make a brief visit
14._____________= the lowest point
Prices have reached_____________________.
26
p. 93
15._______________= a) (of accommodation) having no shared facilities,
and usually having its own private entrance, b) (of a person) not needing the company of others, reserved
16. __________________ = a) the basic systems and services that are
necessary for a country to run smoothly, for example buildings, transport, and water and power supplies, b) the systems or equipment that an organization needs in order to be able to operate efficiently
17. ___________________ =  a) structure giving shape and support,  b)
social order or systém, c) set of principles or ideas used as a basis for one's judgement, decisions, etc.
18._______________= the part of a business that does not meet and deal
directly with customers
19._______________________= become or make sth/sb ready for sth
20.____________= tiny glowing particle thrown off from sth burning or
produced when two hard substances (metal,stone) are struck together
21. ______________________ =    a company which which buys and sells
goods through the mail
22._______________=   the main road in a town, where the shops/stores,
banks
23._______________= a) to modernize, b) to give the latest information
24. ________________ = a building where large quantities of goods are
stored, especially before they are sent to shops/stores to be sold
25.______________   = (of work) requiring skill or tack, (of people) crafty,
deceptive
Listening; 10.5., p. 96
TASK Complete the text with the words you hear.
E:  So,  Larry, I  1. ___________________ (2words) you  have there the
online sales figures for the 2. __________________ (2words) on Audio
Wire?
L:    Ah,    yeah,    it's    not    looking    good,    Ed.    Urn,    really    bad    3.
____________________________(3words). Very few users are returning to
purchase.                                                      High                                                      4.
____________________________________________________________(5word
s) like, urn ...49%.
E:    Yeah,    well,    there're    obviously    5.    ___________________________
(2words) in the checkout process. If the customer wants to make changes, say ten earphones not five, it's difficult. And they get you to register before you can purchase.
K:   Yeah,   and   the   6.   _______________________   (lword)      is   really
confusing. It took me forever to find the earphones I wanted.
E: What about content and design, Kirstie?
K: Well, they have some nice images, but they are, like, you know, just
way too big. I mean this one on the homepage should be a third of the
size.
E: Uh-huh. Anything else?
K:     The     product     pages     have     ...     urn...     again     too     many     7.
_______________________ (2words)   photos that take up space and you
get no idea of the actual product.
E: You mean there is not enough product information.
K: Exactly.
E: So, what's the 8.____________, _________(2words)?
L: I'd say, 9.____________________________(3words)  the whole thing.
K: Yup.
E:  OK, er, let's look at what we can 10. ___________________________
(3words)  in four weeks. Er, deliverables? Larry?
27
L: Oh, um, improve the online checkout process, reduce clicks. We've really gotta persuade the user to purchase.
E: Yeah, I think they need a 11. _______________________________
(4words)    to view all  their product selections.  It should  include,  er
pricing, delivery and payment information.
K: But we need to keep some of those photos of the earphones!
E: Well, OK, as long as you 12. _________________________________
(4words).
K: I'll make them 13.______________(lword). What about the copy?
Some of it really 14._________________(lword).
E: Well, we can recommend some 15._________________(lword) for
copy. It's gotta be 16._______________________________(3words).
Can you take care ofthat and design, Kirstie?
K: Sure.
E:   Let's just  go  over our deliverables.   I  say we  send  them  a   17.
____________________________________________   (3words)   of   the
current site with our recommendations. We' re saying we'll improve the
navigation and content for every page in the buying process, from the
home page through checkout, right? I want both of you to work on that.
K: Yep.
L: Uh-huh.
E: And Kirstie, you say you can do a rewrite of some of the copy? Include
the   18.  ___________________________________  (2words)     of  how
Audio Wire should describe its earphones.
K: Yeah, but what are you doing, Ed?
E:    Me?    I    gotta    write   the    proposal.    Oh,    Larry,    could    we    19.
(9words)?
K: Oh, great.
28
Internet security
Attack and defence
Melissa Vorster is a consultant on Internet security:
'I work with companies to try to prevent hackers from penetrating their computer systems in order to steal or destroy the information on them. Hackers are people who may write programs designed to overload an organization's system with requests for information so that users cannot access it. We call this a denial of service attack, and it causes huge inconvenience for customers and lost business for companies.
Another problem is viruses. A virus is a small program designed to make computers misfunction, despite the firewalls and anti-virus programs that we install as the technical defences against them.'
Cybercrime
'Some companies that I work with sell goods and services over the Internet and need to reassure their customers that their credit card details are safe and will not be stolen by hackers. Credit card details and other confidential information to be transmitted is encrypted, or coded, so that it cannot be read by others. Companies that sell on the Internet will display the level of encryption that users of their site benefit from.
This is a defence against one form of cybercrime - criminal activity on the Internet.'
Privacy and confidentiality
'When someone uses the Internet, they leave an electronic trail, a record of the sites they visit, and if they buy something, their personal details. This raises issues of privacy and confidentiality. Who should have the right to access and analyze this information?
This is all part of the debate about the powers of surveillance (the powers to watch and examine the activities of private individuals) that law enforcement agencies, such as the police, should have. Critics call this snooping, and there are big issues of human rights law and civil liberties at stake because these are freedoms that ordinary people should be able to enjoy.'
29.1     Replace the underlined phrases in the headlines with expressions from A and B opposite. Badly-intentioned intruders penetrate Pentagon computers   K
Xenon's system down for 5 hours in action designed to exclude access
i Companies' system defences withstand latest attack        (2 possibilities)
4
Latest methods of translating to 'code' make confidential messages unreadable by outsiders
29.2
29.3
Illegal internet activity increases three-fold   j
Programs designed to slow computer functions found attachments to company emails
11
Complete the article with expressions from C opposite. (Two expressions are used twice.)
Snooping system is illegal, say police
(1)  .............................. powers allowing law enforcement
agencies to access the communications records of telephone and Internet users are in such a legal mess that they are untenable, one of Britain's most senior police officers will today tell a parliamentary inquiry. Jim Gamble, assistant chief constable of the national crime squad and head of the association of chief police officers' data communications group, will admit to MPs that the current system to access web, email and phone logs
is  illegal  under (2)  ............................................................
.............................., the Guardian has learned.
He will also complain that legal difficulties with the legislation passed to resolve this problem are "leaving the communications industry uncertain of the legal position". His astonishing intervention on behalf of the UK law enforcement community  piles  pressure on  ministers  to
Richard Allan, Liberal Democrat home affairs spokesman and the inquiry's joint chair, said: "Jim Gamble's submission reflects a climate change in the Home Office and the police. They have now realised that this is a matter of major public interest and are trying to strike a better balance between  catching criminals
and protecting the  (5)  ..............................  of innocent
citizens."
At the moment, companies store data only for as long as necessary for their own purposes, such as billing and  marketing.  (6)  ............................................................
rethink their raft of (3)  ..............................  measures
These will require communications providers to stockpile      ..............................are able to access an individual's records
customers'    records    for    long    periods    and    allow     only if they can convince the service provider that they
(4) ..........................................................................................     should  be  exempt  from  data  protection  laws  because
to   access   them   without   need   for   a   judicial   or     there  is  enough  evidence   to  believe  the  person   is
executive warrant.                                                              involved in wrongdoing.                              jns Guardian
Find words or phrases in the article above that mean:
1   not able to be legally enforced        4 formal statement
2  series of actions                               5 change in attitude
3   keep large numbers of                    6 take a fairer approach to
7 not included in
Consider these way to a company:
• speaking on the phone.
- posting a written form.
tial information, such as credit card details,
sending a fax. sending an email.
completing a form on the Internet.
Which do you feel is most secure, and which least? Why?
E-commerce: after boom and bust
Old economy, new economy
In the late 1990s companies raised vast amounts of money from investors for e-commerce Internet sites, both business-to-consumer (B2C) and business-to-business (B2B). B2B, where businesses obtain supplies using the Internet, is also referred to as e-procurement.
Commentators talked about the old economy, with companies doing business in traditional ways, and the new economy, with companies doing business over the Internet. This was the dotcom frenzy, the period of large numbers of Internet start-ups, many promising riches for investors, some of whom believed that the usual laws of economics no longer applied. However, most of the sites from that time have now disappeared.
B2C
In business-to-consumer e-commerce, sites were set up selling everything from pet food to clothes. Among the survivors, there are companies like Amazon, pure-play (exclusively) online sellers, with no traditional shops - no bricks-and-mortar outlets. This is pure e-tailing.
Other retail organizations are clicks-and-mortar ones, combining e-commerce with sales through traditional outlets. Some old-economy companies, like the UK supermarket group Tesco, use e-commerce in conjunction with its existing operations - it did not have to invest in a whole new expensive infrastructure of new computer systems, warehouses, etc. to take care of its e-fulfilment, processing and delivering orders.
BrE: e-fulfilment; AmE: e-fulfillment
B2B
Iß husiness-to-husiness e-commerce, groups of companies can set up public exchanges. For example, the Worldwide Retail Exchange allows companies to bid to supply participating retailers in a reverse auction on the Internet - the supplier offering the lowest price gets the contract.
There are also private exchanges, where a single company deals with suppliers in this way. Some companies prefer to use this form of e-commerce because they do not want to indicate their requirements to their competitors, thus revealing their current activities.
Both public and private exchanges are also referred to as e-marketplaces, trading hubs or trading platforms.
Match the two parts of these sentences containing
1   B2B e-commerce can cut firms' costs                a because
2  The company operates four e-commerce
sites,                                                                  b
3  There was a huge temptation for me to follow the dotcom frenzy
4  Management theorists agreed that                    c old-fashioned command-and-control management styles would not work
5  There has been a trend for investors to            " shift funds out of the technology, media
and telecoms sectors                                         e
6  As the early web firms were addressing the business-to-consumer market,                          f
expressions from A opposite.
the low prices they promised consumers
meant that the scale of their business had to
be enormous.
but I felt more comfortable investing in a
fund whose core holdings are large
multinationals.
it reduces procurement costs, both by making
it easier to find the cheapest supplier and
through efficiency gains.
selling books, CDs, DVDs and computer
games.
in the new economy, where creativity and
innovation are everything.
back into old economy companies such as oil
and car producers.
Complete the sentences with appropriate forms of expressions from B and C opposite.
1   Retailer A sells clothes in shops and also over the Internet: it has................................-
................................-................................outlets.
2  Retailer B sells books and CDs on the Internet and has no shops: it has no......................
................................-................................................................, so it's involved in...............................................
3  Retailer B has built massive warehouses and developed sophisticated computer systems: it has invested in the................................necessary for................................-.................................
4  Household goods manufacturer C has set up a................................................................where it asks for
bids from suppliers.
5  Defence companies D, E, F and G have got together to form a................................................................
in order to get competitive bids from a range of suppliers.
6  Suppliers to D, E, F and G submit prices for particular projects in a................................
................................, and the supplier offering the lowest price wins the contract.
7  Manufacturer C and Companies D, E, F and G run different kinds of................................(-)
.................................(three possible expressions)
Over <\ro Úpu
Have you ever bought something over the Internet? If so, what was your experience of the website, delivery of goods, time taken etc.
UNIT ELEVEN - NEW BUSINESS
Reading; p. 101
TASK1 Par 1
1. _________________ = injury caused by a blow to the body or a fruit,
discolouring the skin but not breaking it.
2. ___________________ = an idea or activity, especially in politics or
business, that suddenly becomes very popular or fashionable, so that a lot of people want to be involved in it:
His recent poll victory could start an ultra-nationalist____________rolling.
jump On/climb On/jOin the bandwagon: Every business was trying to jump on the 'dot-com '____________________________.
3.  ____________________  =   climb  or crawl  quickly,   usu  over  rough
ground or with difficulty
4. ____________________ = element in sb's personality, distinguishing
characteristic
Par 2
1. ____________________ =    a private investor or a financial business
that invests money in new companies, which may involve a lot of risk and bring good profits
2. _________________=   an investor who helps new companies develop
by lending them their own money, which may involve a lot of risk
3. ___________________________ = to have a   tendency to do sth, to
have sth; likely to be sth, to do sth
The car____________________to stall when it's cold outside.
to stall = (of an engine) to stop suddenly because of insufficient power or speed
4._____________________= not very good, second-rate
5.__________________________=   to put a lot of weight on sth
6.___________________= a mark left on the skin by a wound, sore, etc.
7. tissue = mass of cells forming the body of an animal or a plant;
The__________________have been destroyed and a scar has formed.
8.______________= valuable or useful quality or skill
9.___________________= expected to be or to occur, future or possible
Par 3
1.________________= to depend on
2.___________________= possibility, likelihood
Par 4
1. ________________ =   a company that is formed to develop and use
the results of research done at a university or college
_____________=  the act of forming a new, independent company from part of an existing
one; a company formed in this way
2.__________= advantage
have an/the__________on/over sb/sth = have a slight advantage over
sb/sth
The young tennis player definitely had the____________on his older opponent.
3.   ___________   =   someone   who   enters   a   competition,   market   or
examination
4. __________________ = the fact or state of continuing to live or exist,
especially in difficult conditions
Par 5
1.______________= a series of actions or events that together show how
things normally happen or are done; a set of lines, shapes, or colours that are repeated regularly
2._____________= to notice something or someone
trainspotting   =  the activity of watching  trains and  writing  down their numbers and names
3. ________________ = based on your feelings rather than on facts or
evidence
Par 6
1.________________= a way of thinking or behaving that is based on the
belief that important political and social changes are necessary 2.______________= a particular area of activity or life
3. __________________ = causing difficulties that interrupt something or
prevent it from continuing
4. ______________________ = to make someone experience something
unpleasant
5. _________________ =   the control of trade in particular goods or the
supply of a particular service by a small group of companies; the type of goods or service that is controlled in this way; the companies that control the trade
The North American market will ultimately turn into an______________ of five or six
companies.
Oligopoly is formed from the words_____________( a small group of people who control a
business, an organization, a country, etc. for a long time and are unwilling to let other people share power; the business, organization or country that they control) and monopoly.
31
6. ______________ = to gradually damage the surface of rock or land so
that it begins to disappear, or to be gradually damaged in this way; to gradually reduce the strength, importance or value of something, or to be gradually reduced in this way
7.__________________= the situation when companies of the same type
join together; the act of joining two or more things together; the act of making your power, success, knowledge, etc. stronger
The training focuses on the________________of skills.
Par 7
1._______________=   opposite in amount or position to another thing (in
the text this word is in the adverbia form)
There is an____________relationship between shares and the dollar (= the value of one
goes up as the value of the other goes down).
The gold price often moves_________________ to the dollar.  E-business knowledge is
______________proportional to age and height in the organization.
in inverse proportion to
if one thing is in inverse proportion to another, the more of one thing there is, the less there is of the other:
The attractiveness of a  city tends  to  be in inverse proportion  to its  economic productivity.  The size ofdemand is in inverse proportion to the price (= if One ÍS high
the other is low and if one is low the other is high).
Par 8
1._________________= honestly or in a sincere way
2. _______________ = noticing that something exists or is happening and
realizing that it is important
3. ________________ = to receive or obtain something from something
else
4. ________________= concentrating on a particular aim and not wasting
time or energy on other things; clear
5.  ______________=  someone or something that has the same job or
purpose as another person or thing, but in a different country, time, situation, or organization
Par 9
1._______________= using new methods or achieving new results
2. _______________= an amount, level, standard etc that you can use for
judging how good or bad other things are
3. _____________= the possibility to develop or achieve something in the
future
Par 10
1._______________-= a senior official at a college or university
TASK 2 Within the context of the article try to translate the following:
1.  ..  many are failing to prepare thoroughly before scrambling on the bandwagon
2. .. the most widespread trait
3.  They attach  a  lot of importace to what they term "scar tissue"  -evidence that the person has learned from experience.
4. spin-outs have a survival edge in the market over other entrants, as the result of a combination of entrepreneurial flexibility and inherited knowledge
5. Ultimately, though, what distinguishes successful entrepreneurs is their ability to spot commercially exploitable patterns where other cannot.
6. Innovation erodes the profits and position of old companies.
7. It is frequently inversely related to the real potential of an oportunity.
32
8. Consumers have become more value-conscious and less brand-loyal, while retailers have become increasingly powerful.
9. Popular bechmars include an annual growth potential of at least 20%.
10.  the ability to create post-entry barriers
11.                             demonstrable                             value
Listening; 11.6., p. 96
TASK Complete the gaps with the words you hear.
D: Hello?
W: Hello, Darren, this is Wendy Taylor from Fenwick Plastics. I'm phoning
about 1._______________________(2 words) on two of our invoices.
D: Ah, right, yeah. Urn.... could you give me the invoice numbers?
W: Yes, sure. There's 16987, dated 28 May, and 17124, dated 8 June. I
also sent you a written 2.___________________ (2 words) on 10 July.
As you know, our 3.____________________(2 words) are 30 days, and
payment is now 4.________________(1 word).
D: Yeah, sure. I.... I must apologise for the delay, Wendy, you know what
it's like in a busy office. I'll 5._______________ (1 word) payment as
soon as possible.
W: I understand. Could you tell me when that will be?
D: Uh.... on the last banking day of the month.
W: I'm sorry, but we'd expect   payment sooner. We'd have to consider
6. _____________________ (1  word) credit terms if these invoices 7.
_______________________(3 words) seven days.
D:  Look, I'm... I'm sure we can sort this out, Wendy. I can make an exception and settle the invoice for 28 May this week but the other invoice
will be paid as part of our normal monthly 8._______________________
(2 words). Would that be acceptable?
W:  Well, we would  prefer payment of the 9. ___________________ (1
word) invoice within 15 days.
D: Fine, I..I think we can work with that.
W: OK, Darren. I'll 10______________________ (3 words) you on 30
July if we haven 't received both payments. D: Yeah, of course, Wendy. Bye.
33
UNIT TWELVE -PROJECT MANAGEMENT
TASK Find the words in the text defined by the following: Par 1
1.__________= to show publicly that you feel sad or disappointed about
something
2.___________= to take action to deal with a difficult situation
3._______________= a written or spoken statement in which someone
says they are not satisfied with something
4.________________= to examine or discuss a subject, idea etc
thoroughly
Par 2
1.__________= to make someone feel happy and satisfied
2._______________= to give money, equipment, staff, etc. to sth/sb for a
particular purpose; to give sb a particular job to do
3._________________= to decide officially that sth will be used for a
particular purpose; to give sth officially to a particular person or thing; (accounting) to decide which department, product, etc. (cost centre) a particular cost relates to
4.______________= the number of workers needed or available to do a
particular job
Par 3
1.___________= as part of the normal way of doing something
2.______________= to praise sb or sth
3._______________= to complain continuously in an annoying way
4.______________= comments about how well or how badly someone is
doing something, which are intended to help them do it better 5.___________________= making you feel pleased and satisfied
Par 5
1._____________________= a group of experts providing official approval
of an organization, worker, or course of study
2._____________________ = the subjects that students study at a
particular school or college
Par 6
1.____________________= strictly limiting or controlling someone or
something
2.________________= a period of time when someone is not where they
should be or where they usually are; the fact of something not existing or
being prezent
3.______________________= not working normally
REVISION EXERCISES Ul-12
POSE/PRESENT, UNDERMINE, EARN, WAX, ADJUST, FUND,
ESTABLISH
1.   Sometimes  it's difficult to _______________ trust and _____________
good business relationships in this country.
2.   Please ___________ the  pace  of your delivery to  reflect  what the
audience is used to.
3.   He was _____________ lyrical  in a classroom on what happens in a
business environment without having the first hand experience himself.
4.   In India more and more people will have to start working early and
________________their own education due to increasingly higher education
costs.
5.  The arrival of big multinational companies is________________virtues
such as loyalty, hierarchy and discipline.
6.   These ________________ a  mortal threat to the country's continued
expansion.
SEE, FILE FOR, STAVE OFF, WRITE OFF, JACK IN, PRESIDE OVER
7.    The   company   _________________   collapse   last   year   thanks   to   a
restructuring in banks and bondholders agreed to________________most
of the company's debt.
34
8.   The   year  2005  _____________  a   massive   decrease   in   investment
activity.
9.  Yesterday they______________bankruptcy protection.
10.  The Czech Republic__________________________the EU now.
11.  He________________his job and became self-employed.
DECLARE, TAP OUT, MINIMIZE, BIND, TOUT FOR, SOLICIT FOR, TAP INTO, BE RENOWNED, WHIP UP, GO
12.     Sometimes   consultants    resort   to    using    risky   strategies    like
_____________________  business  from  clients  in  whose  offices  they're
currently working.
13.   Anybody can set up their own  business and ___________________
work.
14.   The  professional  code will  _________________ the chances  of an
assignment______________wrong.
15.   Members of this institute__________________a professional code of
conduct.
16.           Traditional           sources           of           revenue           have           been
kartely__________________________. There is an urgent need to find new
alternatives.
17.   Companies try to __________________ investors'   enthusiasm  with
ambitious growth plans.
18.   This company _____________________ its ability to ________________
new areas of growth.
19.      In     2000    the    company     reported     a     mammoth     loss    and __________________bankruptcy.
WORDBUILDING
1.  These issues set the stage for communication difficulties and potential ______________________________________. /UNDERSTAND/
2.  It's the most_______________________and_________________book on
the issue. /COMPREHEND, AUTHORITY/
3.   These are all ripe areas for________________________ and irritation.
/INTERPRET/
4.    The  _____________   made   a   few   serious   mistakes   in   the   speech
____________________. /LECTURE, DELIVER/
5.  This is not a tax-_________________ item. /DEDUCT/
6.  She didn 't manage to finish the research so the impact of her work will be_____________________________. /SIGNIFY/
7.    Allow   the   other   person   to   finish   her/his   _________________   or
____________________without interrupting. /RESPOND, CONTRIBUTE/
8.  It's been_______________talking to you. /PLEASE/
9.   The _________________ are having an _____________________ meeting
with their line managers. /APPRAISE, APPRAISE/
10.  The university won __________________from other________________
education          _____________________.          /RECOGNISE,          PRESTIGE,
PROVISION/
11.   We talked in strict ___________________ about the issue. This is a
sensitive matter. /CONFIDE/
12.       Instructors      become     ______________________     and      mentors.
/FACILITATE/
13.   We   need   to   improve  the  _____________________  of the   board   to
shareholders. /ACCOUNT/
14.  One effect of______________________in the industry has meant that it
is now not________________________for companies to purchase from any
one source. /DEREGULATE, OBLIGE/
15.  Choose your words______________. A________________word can lose
you___________________________. /CARE, USE, CREDIBLE/
16.   They are _________________ and feel _____________________ about
why calls are recorded.  /HOSTILITY, SUSPECT/
17.  Here is some_____________________feedback. /REPRESENTATION/
18.     We    have    _______________________________    our    larger    rivals.
/CONSISTENT, PERFORM/
19.   The position is for four months to cover___________________leave.
/??MOTHER/
20.  He is our most______________________consultant. /KNOW/
21.  They stopped using it__________________. /GRADE/
22.  He specializes in_________________planning. /SUCCEED/
23.   Mr Smith's__________________, Mr Simpson decided to diversify into
electrical________________________. /SUCCEED, APPLY/
35
24.    They   are   not   going   to   be   granted    any___________________.
/CONCEDE/
25.    It  was  an   example  of__________________________.   /CONTRACT,
FAIL/
26.   Written contracts should also include fees and___________________.
/DELIVER/
27.  The problem is the test can draw_____________,________________or
even     damaging     _________________________.     /ACCURACY,     LEAD,
CONCLUDE/
28.      The     market     is     becoming______________________________
/INCREASE, COMPETE/
29.   They have the cheak to ask for huge fees for __________________
work. /STANDARD/
30.    Finding   a   new   source   of   __________________   is   very   difficult.
/GROW/
31.   Was it _________________ that caused Swissair's ________________
and  baggage handling to ________________,  hurting  business, and  its
______________________   in   the   world's   more_____________________
airlines to prove an _____________________________ drag on its finance?
/DISTRACT, PUNCTUAL, WORSE, INVEST, MARGIN, ADD/
32.  Companies are moving away from large_________________of scale.
/ECONOMICS/
33.  Unfortunately he is very______________________to get the job. There
are other excellent______________________. /LIKE, APPLY/
34.  You need to put_______________on important words. /EMPHASIZE/
35.  Send them a second_________________letter. /REMIND/
36
Striving for perfection
Benchmarking and best practice
Benchmarking is the idea that a firm should find out which company performs a particular task best and model its performance on this best practice. Companies talk about carrying out a benchmarking exercise. To do this, they benchmark themselves against other companies.
Large companies can measure the performance of different departments in relation to each other in an internal benchmarking exercise. Competitive benchmarking involves looking outside the company at how other companies in the same industry do things.
Functional benchmarking looks at how the same
function such as manufacturing or personnel
recruitment is done by non-competitors. Companies
can learn a lot from firms who are not their direct
competitors. For example, a train company has learned how to organize the cleaning of
its trains better by looking at how an airline organizes the cleaning of its planes.
One way of seeing how a competitor's product is made is by reverse engineering - taking the product apart to see how it is made. The same principle can also be applied to services. This technique can also be used in benchmarking.
Note: 'Best practice' is usually uncountable, but you can also talk about 'the best practices' in a particular area.
Six sigma quality
Quality can be measured in terms of the number of defects per million parts, operations, etc. For example, one sigma equals 690,000 defects per million parts and two sigma means 45,000 defects per million. Even with two sigma quality, the chances of a manufactured product being defective are quite high.
Motorola was the first company to aim for six sigma quality. In manufacturing, six sigma quality is when there are fewer than 3.4 defects per million components. This idea can also be applied in areas outside manufacturing. In invoicing, for example, it means fewer than three or four mistakes per million transactions.
Six sigma quality has been taken up by several other companies.
And the ultimate goal is zero defects - no defects at all.
1 5.1     Complete the sentences with appropriate forms of expressions from A opposite.
1   The manufacturers' association wants companies to improve manufacturing................, so it's
offering a new service designed to help companies................themselves against the best in
their industries.
2   Engineers made replacement parts for the cars by copying the shape and dimensions of the original parts, a process known as.................................
3  Internal................looks for internal................................and tries to establish them throughout the
organization.
4  We use................................to evaluate the effectiveness of your website against those of your
competitors.
5  Look outside your industry!................................can teach you a lot, and as the companies you are
asking to give you advice are not your competitors, they may be more willing to help.
1 5.2     Read the article relating to the ideas in B opposite. Then answer 'yes' or 'no' to the questions below about the vocabulary used in the article.
When quality is not enough
Quality improvement programmes come in many different flavours. The most common are Total Quality Management (TQM), Six Sigma and the Baldrige system promoted by the government-backed National Institute of Standards and Technology (NIST).
There are more similarities than differences between them. The common belief is that companies should aim for 'zero defects' in all aspects of their operations, achieved by relentless improvements in business processes. Common techniques include a team-based approach to problem-solving and a highly quantitative approach to measuring results.
Motorola, maker of microprocessors and cellphones, developed Six Sigma as a technique to improve the competitiveness of its manufacturing. The aim of the strategy is to reduce defects to fewer than 3.4 for every million repetitions of any process. But despite achieving Six Sigma quality in many areas of its business - and being the first large company to win a Baldrige quality award from the NIST - Motorola has often struggled. It is now
engaged in a painful restructuring programme. Given this mixed experience, why are many US companies now adopting Six Sigma? Fashion and the influence of General Electric are big factors. Jack Welch, GE's recently retired chairman and chief executive, was introduced to Six Sigma in the mid-1990s by Lany Bossidy. a former GE colleague who at the time was running Allied Signal. Mr Bossidy had, in turn, picked up the idea from Motorola, with which Allied Signal did business. Quality was at the time an unfashionable management concept. The TQM fad of the 1980s had run out of steam. Received wisdom was that more radical approaches such as business process re-engineering were required if companies were to stay competitive. Undeterred, in 1996 Mr Welch declared Six Sigma quality to be his next group-wide initiative for GE. By the end of the decade he was declaring it a spectacular success: his 1999 letter to shareholders attributed '$2bn in benefits' to the Six Sigma programme.
1   If something is promoted by a particular organization, does it have that organization's support?
2  If improvements are relentless, do they keep on happening?
3   Does a quantitative approach to something depend on general descriptions and feelings about it?
4  If restructuring is painful, is it easy?
5  If an organization adopts an approach, does it accept it and use it?
6  Do former colleagues still work together?
7   Is a fad a genuine and important change that will last?
8   If a movement runs out of steam, does it continue and develop?
9  Is a spectacular success a very big one?
Over +o ipu
Think about your organization or one you would like to work for. How much do you know about how its competitors do things? Do you think it's useful to know how effective they
are in different areas?
38