Business & Management
Business and management study how organizations are designed, led, and operated to create value — encompassing strategy, organizational behaviour, marketing, operations, finance, accounting, and entrepreneurship.
Scope
The field covers strategic management, organizational behaviour and human resources, marketing, operations and supply chain, entrepreneurship, international business, accounting, finance, management information systems, and innovation, drawing on economics, psychology, sociology, and operations research.
Sub-topics
Core questions
- How should organizations be structured and led?
- Why do firms exist, and what are their boundaries?
- How do firms create and sustain competitive advantage?
- How do individuals and groups behave within organizations?
- How are products created, marketed, financed, and delivered?
Key concepts
- Division of labour and efficiency
- Transaction costs
- Organization as cooperative system
- Management by objectives
- Competitive advantage
- Five forces
- Organizational behaviour
- Strategy
Key theories
- Scientific and administrative management
- Taylor's scientific management sought efficiency through the study of work, while Fayol set out general principles and functions of management.
- Theory of the firm
- Coase explained the existence and boundaries of firms by transaction costs — firms arise when internal coordination is cheaper than the market.
- Organization and the executive
- Barnard reframed organizations as cooperative systems and management as eliciting cooperation; Drucker founded modern management as a discipline and practice.
- Competitive strategy
- Porter's frameworks (five forces, generic strategies) made industry analysis and competitive positioning central to strategic management.
History
Management thought began with scientific (Taylor) and administrative (Fayol) management in the early twentieth century, followed by the human relations movement (Mayo) and Barnard's and Simon's organization theory. Coase's transaction-cost view founded the economic theory of the firm. Drucker established management as a discipline; from the 1980s, strategy (Porter) and the resource-based view, alongside finance, marketing science, and operations, defined the modern field.
Debates
- What are the boundaries of the firm?
- Transaction-cost and resource-based theories debate why firms exist, what they should make versus buy, and how large and diversified they should be.
- Where does competitive advantage come from?
- Positioning views (Porter) emphasizing industry structure contend with resource- and capability-based views emphasizing internal resources.
Key figures
- Frederick Taylor
- Henri Fayol
- Ronald Coase
- Chester Barnard
- Peter Drucker
- Michael Porter
Related topics
Seminal works
- taylor-1911
- fayol-1916
- coase-1937
- barnard-1938
- drucker-1954
- porter-1980
Frequently asked questions
- Is management a science or an art?
- Both: it draws on systematic theory and evidence (economics, psychology, operations research) but also on judgment, leadership, and practice that resist full formalization.
- How does business differ from economics?
- Economics studies how societies allocate resources broadly; business and management study how individual organizations are run and create value, applying economics among other disciplines.