PAU Balearic Islands Business & Business Model Design (UIB) cheat sheet
PAU Balearic Islands Business & Business Model Design (UIB) · Keep the key ideas within reach.
Business and entrepreneurship: role of the firm, entrepreneurial initiative and business environment
Company functions in a market economy: produces goods/services, creates added value, generates employment, pays taxes, redistributes income, drives innovation and growth.
Added value = value of output − value of intermediate inputs purchased from other firms; it is the base for distributing wages, interest, rent and profit.
Legal forms and liability: sole trader (unlimited liability), sociedad limitada/SL (capital divided in participaciones, limited liability), sociedad anónima/SA (shares, minimum capital), cooperative (worker-owned, one member one vote).
Entrepreneurial initiative: identifies an opportunity, assembles resources, assumes risk and residual profit; distinct from the manager who administers existing resources.
Business environment analysis (PESTEL): Political, Economic, Social, Technological, Ecological, Legal factors; used to detect opportunities and threats external to the firm.
General vs specific environment: general = macro factors affecting all firms; specific = customers, suppliers, competitors, financial institutions affecting one sector.
Opportunity evaluation criteria: market size and growth, unmet need, feasibility with available resources, profitability margin, risk level, timing.
Entrepreneurial ecosystem elements: finance (banks, business angels, venture capital), public aid and subsidies, incubators and accelerators, universities, regulation, infrastructure.
Innovation types per Schumpeter: new product, new process, new market, new source of supply, new organisation of an industry.
Business models: value proposition, customer segments, channels, customer relationships and revenue streams
Business model = logic of how an organisation creates, delivers and captures value; the Business Model Canvas has nine blocks.
Value proposition: the bundle of products/services solving a customer problem or satisfying a need; must state the specific pain relieved or gain created.
Customer segments: groups with distinct needs, behaviours or willingness to pay; types include mass market, niche, segmented, diversified, multi-sided platform.
Channels have five phases: awareness, evaluation, purchase, delivery, after-sales; each channel is owned, partner or a mix, and direct or indirect.
Customer relationship types: personal assistance, dedicated personal assistance, self-service, automated services, communities, co-creation.
Revenue stream types: asset sale, usage fee, subscription, lending/leasing/renting, licensing, brokerage commission, advertising.
Pricing mechanisms: fixed (list price, product-feature dependent, customer-segment dependent, volume dependent) vs dynamic (negotiation, yield management, real-time market).
Revenue model metrics: revenue = price × quantity; recurring revenue share, average revenue per user (ARPU), customer lifetime value (CLV) vs acquisition cost (CAC).
A revenue stream is viable when CLV > CAC and the payback period fits the firm's cash cycle.
Key resources, key activities, key partnerships and cost structure
Key resources types: physical (plant, vehicles, machines), intellectual (brands, patents, data, copyright), human, financial.
Key activities: production, problem solving (consulting, hospitals, software), platform/network management (matchmaking, transaction platforms).
Key partnerships types: strategic alliances between non-competitors, coopetition, joint ventures, buyer-supplier relationships for reliable supply.
Partnership motivations: economies of scale, risk and uncertainty reduction, access to particular resources and activities, acquisition of capabilities.
Cost structure: fixed costs (independent of volume) vs variable costs (proportional to volume); economies of scale (unit cost falls with volume) and economies of scope (shared resources across products).
Cost-driven vs value-driven business models: cost-driven minimises cost with low-price proposition and high automation; value-driven focuses on premium value and customisation.
Operating leverage = fixed costs / total costs; high operating leverage raises profit volatility when sales change.
Contribution margin per unit = price − variable cost per unit; break-even quantity = fixed costs / contribution margin per unit.
Outsourcing decision rule: outsource activities that are non-core, low strategic value and available from specialised suppliers at lower cost.
Business model design and innovation: ideation, prototyping, validation and lean startup
Design process stages: mobilise, understand, design, implement, manage; design uses divergent thinking (generate options) then convergent thinking (select).
Ideation techniques: brainstorming, analogical thinking, questioning assumptions, SCAMPER, customer observation, extreme-customer interviews.
Visual thinking tools: Business Model Canvas, Empathy Map, Customer Journey Map, Value Proposition Canvas (customer jobs, pains, gains vs pain relievers, gain creators).
Prototyping: sketch, mock-up, business case, test scenario; purpose is to explore several alternatives cheaply, not to perfect one plan.
Lean startup loop: Build → Measure → Learn; validated learning is the unit of progress, not the business plan document.
Minimum viable product (MVP): smallest version that allows testing key hypotheses with real customers; types include landing page, concierge, Wizard of Oz, single-feature product.
Hypothesis testing: state assumption, define metric and success threshold, run experiment, decide pivot or persevere.
Pivot types: zoom-in, zoom-out, customer segment, customer need, platform, channel, revenue model.
Business model innovation often comes from changing several blocks at once (e.g. subscription plus platform) rather than a single product improvement.
Business strategy and competitive analysis: environment, resources, capabilities and competitive advantage
Porter's five forces: rivalry among existing competitors, threat of new entrants, threat of substitutes, bargaining power of suppliers, bargaining power of buyers.
Porter's generic strategies: cost leadership, differentiation, focus (cost focus or differentiation focus); stuck in the middle = no clear advantage.
SWOT combines internal strengths and weaknesses with external opportunities and threats; the analysis only has value if it feeds concrete actions.
Resource-based view (VRIN/VRIO): a resource yields sustained advantage if it is valuable, rare, inimitable and non-substitutable/organised.
Capabilities are bundles of routines that combine resources; dynamic capabilities = sensing, seizing and transforming.
Value chain (Porter): primary activities (inbound logistics, operations, outbound logistics, marketing and sales, service) and support activities (firm infrastructure, HR, technology, procurement).
Competitive advantage = higher value delivered or lower cost than rivals; sustained when rivals cannot easily imitate the source.
Ansoff growth matrix: market penetration, market development, product development, diversification (highest risk).
BCG matrix: stars (high growth, high share), cash cows (low growth, high share), question marks, dogs.
Marketing and market research: segmentation, positioning, marketing mix and digital marketing
Market research methods: primary (surveys, interviews, observation, experiments) vs secondary (existing reports, statistics, internal data); qualitative vs quantitative.
Sampling concepts: population, sample, representativeness, sampling error; a larger sample reduces error but does not remove bias.
Segmentation criteria: measurable, accessible, substantial, differentiable, actionable; variables are geographic, demographic, psychographic and behavioural.
Positioning: the place a brand occupies in the customer's mind relative to competitors; communicated through a positioning statement and perceptual map.
Marketing mix 4Ps: product (features, quality, brand, packaging, lifecycle stage), price (cost-plus, value-based, penetration, skimming), place (distribution channels, coverage), promotion (advertising, sales promotion, PR, personal selling, direct marketing).
Extended services mix: people, process, physical evidence.
Product lifecycle: introduction, growth, maturity, decline; price and promotion strategy differ by stage.
Price elasticity of demand = % change in quantity / % change in price; elastic if absolute value > 1, inelastic if < 1.
Digital marketing: SEO (organic search), SEM/paid search, content marketing, email, social media, influencers, affiliate; metrics include CTR, conversion rate, CAC, ROI.
Financial management and investment appraisal: sources of finance, costs, profitability and financial statements
Balance sheet identity: Assets = Liabilities + Equity; current assets/liabilities have a horizon of one year or less.
Income statement: revenue − expenses = profit; distinguishes gross profit, operating profit (EBIT) and net profit after tax and interest.
Sources of finance: internal (retained earnings, amortisation) vs external; own capital (equity, partners' contributions) vs borrowed capital (bank loans, bonds, leasing); short-term (supplier credit, overdraft, factoring) vs long-term.
Working capital = current assets − current liabilities; liquidity ratios: current ratio = current assets / current liabilities, quick ratio excludes inventories.
Profitability ratios: ROE = net profit / equity; ROA = net profit / total assets; margin = profit / sales.
Break-even point (units) = fixed costs / (price − variable cost per unit); break-even in value = fixed costs / contribution margin ratio.
Payback period = time to recover the initial investment from cash flows; shorter is preferred but it ignores cash flows after payback.
NPV = Σ CFt / (1+k)^t − initial investment; accept if NPV > 0; internal rate of return (IRR) is the discount rate making NPV = 0; accept if IRR > cost of capital.
Weighted average cost of capital (WACC) = (E/V)·Ke + (D/V)·Kd·(1−tax rate).
Human resources and organisational design: motivation, leadership, teamwork and structures
Maslow hierarchy: physiological, safety, social, esteem, self-actualisation; a satisfied need stops motivating.
Herzberg two factors: hygiene factors (salary, conditions, policy) prevent dissatisfaction; motivators (achievement, recognition, responsibility, growth) create satisfaction.
Other motivation theories: McGregor Theory X (control) vs Theory Y (self-direction); Vroom expectancy theory (expectancy × instrumentality × valence); Adams equity theory (compare input/output ratio with others).
Leadership styles: autocratic, democratic/participative, laissez-faire; situational leadership adapts to follower maturity; transformational vs transactional leadership.
Team development stages (Tuckman): forming, storming, norming, performing, adjourning.
Organisational structures: functional (grouped by speciality), divisional (by product, customer or geography), matrix (dual reporting, combines functional and project lines), flat/holacracy.
Span of control: number of subordinates per manager; wide span gives flatter hierarchy and needs more autonomy.
Centralisation vs decentralisation: decision authority held at the top vs delegated to lower levels.
Human resource cycle: recruitment and selection, training and development, performance appraisal, compensation, separation.
Business law and social responsibility: legal forms, contracts, ethics, sustainability and CSR
Contract elements: consent of the parties, definite object, cause/consideration and capacity; a contract binds the parties from its perfection unless formal requirements apply.
Contract validity: nullity when an essential element is missing or the object is unlawful; voidability for consent defects (error, duress, fraud, misrepresentation).
Company formation requires a public deed before a notary and registration in the Commercial Registry; the SL/SA acquires legal personality on registration.
Corporate bodies: general meeting of shareholders (approves accounts, appoints directors, amends bylaws) and board of directors/administrators (management and representation).
Directors' duties: diligence, loyalty, avoid conflicts of interest, business judgment; liability for damages caused by fault.
Labour contract types: indefinite, temporary (specific project, replacement), part-time, training; basic rights include salary, working time limits, holidays, non-discrimination.
Consumer protection: right to information, product safety, guarantees and returns, protection against unfair commercial practices.
CSR dimensions: economic, legal, ethical and philanthropic (Carroll); triple bottom line = people, planet, profit.
Sustainability reporting and ethics tools: codes of conduct, compliance programmes, stakeholder dialogue, ESG criteria used by investors.