Mgec40 Notes Essay

638 Words Oct 18th, 2015 3 Pages
MGEC40H3-Y
ECONOMICS ORGANIZATION AND MANAGEMENT
TEXTBOOK NOTES
CHAPTER #1

CHAPTER STARTS OFF BY DISCUSSING HOW TRADE TOOK PLACE BACK IN 1840S
• Factor – a seller (in this case a merchant selling agriculture)
• Agent – a buyer (in this case a buyer in a foreign city that the factor has to manually locate)
• Broker – someone who helps the two find one another
• Transactions were informal, infrequent, inefficient
• Price risk – the risk that the price that buyer and seller expected at the beginning is not the price which was received during transaction
LIFE WITHOUT MODERN INFRASTRUCTURE:
• Infrastructure – includes those assets that assist in production and distribution of goods and services that the firm itself cannot easily
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Bcs Chicago’s businessmen were the first to take advantage of new technology o Swift and Amour – was a butcher shop who adopted the “refrigerated train cart” (a fridge lined with ice) that reduced costs and risks o Cyrus McCormick – took advantage of the grain elevator to store/transport grain o ^probably don’t need to know these examples o Throughput – movement of inputs and outputs through a production process (aka rate of production)
1910s
• Mass production – new technologies enabled goods to be produced at costs far below what older technology achieved (it was reliant on volume)
• Vertical integration – when you choose to produce raw materials and/or distribute finished goods themselves rather than rely on independent suppliers, factors and agents for these tasks o Vertical integration was the crazy o A couple years after this horizontal integration was the focus
• Multidivisional or M-form – refers to organizational structure by which firm is separated into several semi-autonomous units which are guided and controlled by financial targets from the centre o 1960s was mostly M-form industries
• Scientific Management – a method which sought to identify most efficient techniques for management through “time and motion” studies and then motivated worked to adopt these ways of working through the use of

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