Companies Are in Business to Make Profits and Create Wealth for Their Shareholders - Assignment Example

The paper "Companies Are in Business to Make Profits and Create Wealth for Their Shareholders" is a wonderful example of an assignment on business. Business startups need finances to run their initial operations. The first thing I will do is to introduce learners to the precise definition of the term venture capital. I will ask the students to name and explain the various types of capital they understand and from there I can explore further beginning from what they know. Therefore, the first in delivering such a lecture is to pose a question to the students on what they understand about venture capital in the United States, how it began and its impact on society.

In this case, venture capital by definition is the monetary resources provided by investors to small-scale businesses or firms. The provision of this capital is based on the investor’s optimism towards the potentiality of the business to grow in the future.  I will let the student master the key terms in this definition for better understanding. Key in this definition is the fact that venture capital is provided for the startup of viable business proposals.

As the lecture continues, I will introduce the students to the history of venture capital in the US.  It was in this case, started as a strategic capital funding aimed at lifting up considerably viable ideas and assisting firms that we're unable to step up in certain particular critical stages of their financing. Venture capital has an impact on society because it serves to lift up creative business ideas that finances might cripple their development and potential. The process of venture capital constitutes the funding agency or individual and the owner or owners of the business idea considered potentially feasible. Financing startups are risky, but the investors also understand that, the higher the risk involved in a business venture, the higher the returns. The investors use their expertise to evaluate the various proposed ventures and select the most likely to achieve growth and return on investment. To conclude the lecture, I will remind the students of the suitability of venture capital in the initial financing of an enterprise. Venture capital is most suitable for startups and companies not yet in the manufacturing process.

Companies are in business to make profits and create wealth for their shareholders. Quality attracts customers and provision of quality services coupled with reduced costs hence low pricing serves to penetrate the market. The parameter of business success is based on the financial returns brought in by the investment. The key elements for financial returns are costs and revenues gained. Aravind eye care took into consideration the importance of driving down its costs of services. The first driver of their success is cost minimization. Cost minimization alone was not enough for this company. It is commonly noticed that minimized costs are coupled with low-quality services. This happened directly opposite for Aravind eye care. Quality service provisions stand to be the firm’s second driver of success. Thirdly, the company’s large market share is another considerable driver of success. The company is the biggest provider of ophthalmological services in the world. It is, however, strategically located in India where the wider majority of the poor populations require these medical services.  The provision of quality services at an affordable price is the most important aspect that led to the remarkability of Aravind eye care.

 “Business plan is nothing more than paperwork and it is a waste of time,” This can be argued out and convincing reasons can be really engineered. At first, someone can argue because plans might not be always achieved. Most business plans had no connection with what the business eventually became. For instance, some computing technological companies that planned to manufacture computer hardware ended up in manufacturing computer software.  Another argument is on the dynamics associated with the business environment that render plans irrelevant. An entrepreneur may write a sound business plan and research entirely what he or she could require, but he or she does away with the plan when the business hits unanticipated occurrences. Lastly, the longer the time involved in planning and developing plans the more likely the idea becomes outdated or stolen.

The first counter-argument, a well-developed business plan is specific and achievable thus deviation from a plan means executing a totally different business idea. Business needs to work as planned and planning means that one exactly knows what is expected of the business. Secondly, uncertainties are real, a good business plan considers alternatives in times of uncertainties and adjustments are strongly acceptable. Thirdly, a business plan needs to be time-bound and timely in its process, therefore, a good business idea in the first place needs to be unique and relevant to the existing environment. A good plan has to cope with dynamics. Be it that the business may end up providing another service or product, the importance of the business plan as the initial initiator of the process cannot be undermined.