Business Dictionary – A

A1

    Top quality rating, applicable to various business situations, e.g., credit-worthiness, and more general references to quality and fitness for purpose.

Abilene Paradox

    Observed in many poor or daft decisions by groups or committees, in which the collective decision is considered silly by individual members. From Jerry B Harvey’s book The Abilene Paradox and other Meditations on Management (Jossey-Bass, 1988): a family decide to go to Abilene, as suggested by someone believing others might want to go, though he had no strong personal view. The trip was a waste of time, after which it emerged that no-one wanted to go. The effect can also apply in elections and especially tactical voting, whereby the collective effect produces an outcome nobody wants.

Above The Line

    Marketing and advertising through mass-media, such as television, radio, newspapers, magazines, Internet, etc., which is less personal than Below The Line Marketing. Companies usually use advertising agencies for ATL marketing.

Abram’s Law

    Construction industry theory relating to concrete strength as determined by the ratio of water to cement.


Absolute Advantage

    Being able to produce goods more cheaply than other countries.

Abstract

    A brief summary covering the main points of a written article or research project.

Accelerator

    A company which supplies office space, marketing services, etc., in exchange for payment, to help get new companies started.

Acceptance Bonus

    The amount paid to an employee who agrees to perform a difficult task.

Acculturation

    Socialization process through which new employees learn, adjust to, and internalize the corporate culture. progressive organizations allow for sufficient acculturation time and help newcomers through orientation sessions and by facilitating learning.

Across The Board

    The involvement of, or affect on, everyone or everything in an industry or company.

Activity Based Management

    Management based on cost of activities a management control technique that focuses on the resource costs of organizational activities and processes, and the improvement of quality, profitability, and customer value. This technique uses activity based costing information to identify strategies for removing resource waste from operating activities. Main tools employed include: strategic analysis, value analysis, cost analysis, life-cycle costing, and activity based budgeting.

Adaptation

    1. Edited or revised version of a work aimed at serving a specific need.

    2. Modification of a concept or object to make it applicable in situations different from originally anticipated.

Added Value

    Enables and justifies a profit in business.

Addendum

    An added section of information in a letter or report.

Ad hoc

    Created or done for a particular purpose as necessary and not planned in advance.

Adjunct

    A thing which is added or attached as a supplementary, rather than an essential part of something larger or more important.

Ad Rotation

    Describes the rotation of advertisements on a web page – each time a user clicks on a different page or returns to a page they’ve viewed previously in the same session, a different advert appears on the screen.

Affidavit

    A sworn signed statement of fact used as evidence in court whose signature has been witnessed by a commissioner of oaths or other authorised officer, for example a notary. Medieval Latin for ‘he has stated on oath’, from affidare, meaning to trust.

Affiliate

    A company or person controlled by or connected to a larger organisation. In web marketing an affiliate normally receives a commission for promoting another company’s products or services.

Aggregate

    A whole consisting of the combination of smaller separate elements.

Aggregate Planning

    The process of planning and developing the best way of producing the right amount of goods, at the right time and at the minimum cost, based on the total number of items which need to be produced, and the amount of materials, equipment and workers necessary for production.

Aggressive Growth Fund

    A high risk investment fund in which shares are expected to increase in value very quickly in the hope of making large profits.

Agile Development Method

    A type of business development which gets things moving quickly and adapts during the development, as distinct from conventional planning and project management implementation.

Agreement of Sale

    Formal contract between buyer and seller a written contract specifying the terms under which the buyer agrees to buy particular real estate and the seller agrees to sell it.

Air Waybill

    Documents accompanying shipments by air documentation issued by an airline for the shipment of goods by air freight.

A-list

    A list of the most celebrated or sought-after companies or individuals, especially in show business and entertainment.

Alpha Test

    The first stage of testing a new product, especially computer software or hardware, carried out by a developer under controlled conditions.

Amalgamate

    When two or more companies combine or unite to form one large organisation.

Ambiguous

    Unclear or uncertain. An ambiguous phrase is one that is not easy to understand, and often could be interpreted different ways. Something ambiguous can occasionally be deceptive, either intentionally or unintentionally, because the interpreter isn’t able to figure out the actual meaning. The terms and conditions of a website, or the warranty of a product, if written with ambiguity, could lead to a consumer not understanding the consequences of certain behaviors.

Anchor Tenant

    The first and most prestigious tenant, typically a store in a shopping centre, that will attract other tenants or shoppers.

Ancillary Staff

    People who provide necessary support to the primary activities and work of an organization, e.g: schools, hospitals.

Annuity

    Often used to provide a pension. An annuity is a fixed regular payment payed over a number of years to a person during their lifetime.

Antediluvian

    An interesting and humorous metaphorical description of something (for example a product or service or concept) that is obsolete, old-fashioned or primitive, or devised a long time ago. ‘Ante’ is Latin for ‘before’, and ‘diluvian’ is from Latin ‘diluvium’ meaning ‘deluge’, so the overall literal meaning is ‘before the flood’, being the biblical flood and Noah’s Ark, etc. Antediluvian is therefore a clever way to say that something is (so old as to be) ‘out of the Ark’.

Anti-Dumping

    Preventing cheap sale of products overseas intended to prevent the sale of goods on a foreign market at a price lower than is usually charged in the home market.

Appraisal

    A review of performance, capability, needs, etc., typically of an employee, in which case the full term is normally ‘performance appraisal’.

Aptitude

    Acquired or natural ability (usually measurable with aptitude tests), for learning and proficiency in a specific area or discipline. Aptitude is expressed in interest, and is reflected in current performance which is expected to improve over time with training.

Arbitrary

    1. Based on individual discretion, not on an objective criteria.
    2. Based on bias or prejudice, not on fact or reason.

Arbitration

    Settlement of a dispute (whether of fact, law, or procedure) between parties to a contract by a neutral third party (the arbitrator) without resorting to court action. Arbitration is usually voluntary but sometimes it is required by law. If both sides agree to be bound by the arbitrator’s decision (the ‘award’) it becomes a binding arbitration.

Arbitrator

    An independent person or body officially appointed to settle a dispute.

Articles Of Association

    The document which lists the regulations which govern the running of a company, setting out the rights and duties of directors and stockholders, individually and in meetings.

Aspirational Brand

    A brand or product which people admire and believe is high quality, and wish to own because they think it will give them a higher social position.

Assembly Line

    System for putting parts together in specific order a line of production in which a number of assembly operations are performed in a set sequence. The speed of movement of an assembly line has to be matched with the skills and abilities of the workers and the complexity of the assembly process to be performed. The assembly line emerged from the ideas of scientific management and was popularized by a number of entrepreneurs, including Henry Ford in the car production industry.

Assessment

    1. Procedure used by government assessors to determine the value of a property, or the income of a person or entity, in order to charge taxes or to levy on the orders of a court.
    2. The evaluation of a situation or person.

Asset Stripping

    Buying a stricken company and selling off its assets with no thought for the future of the company or its people, customers, etc.

Attrition

    The process of reducing the number of employees in an organisation by not replacing people who leave their jobs.

Audit of Management

    Assessment of systems and procedures of organization a structured review of the systems and procedures of an organization in order to evaluate whether they are being conducted efficiently and effectively. An audit of Management involves establishing performance objectives, agreeing the standards and criteria for assessment, and evaluating actual performance against targeted performance.

Autocratic

    Offensively self-assured or given to exercising unwarranted power. Expecting to be obeyed and not caring about the opinions and feeling of others. See X-Y Theory.

Avant Garde

    New or original and often unconventional techniques, concepts, products, etc, usually associated with the arts and creative areas.

Average Daily Rate

    In the hotel industry a calculation of the average price at which a hotel room is booked each night based on total daily revenue divided by the number of rooms sold. The term may have more general meanings in other contexts.