What is the McKinsey 7S Model? The McKinsey 7S Model refers to a tool that analyzes a company’s “organizational design.” The goal of the model is to depict how effectiveness can be achieved in an organization through the interactions of seven key elements – Structure, Strategy, Skill, System, Shared Values, Style, and Staff. The focus…
What is Main Street vs Wall Street? “Main Street vs Wall Street” is used to describe the contrast of general consumers, investors, or small local businesses with large investment corporations. Main Street represents the small and local ones, including small businesses, general individual investors, and small independent investment firms. Wall Street, as a symbol of…
What is a Mortgage Rate? Mortgage rate is the rate of interest charged to a borrower on a mortgage. A mortgage loan is a secured loan that enables borrowers to raise funds by pledging their property. It is a major financial commitment with severe consequences locking borrowers into a spiral of payments. Thus, mortgage rates…
What is the Volume Price Trend Indicator (VPT)? The Volume Price Trend Indicator (VPT) is a stock market indicator that helps traders relate a stock’s price and trading volume. It helps in identifying the parity between the supply and demand for a stock and also helps in predicting the price of a stock, both in…
What is a Majority Shareholder? A majority shareholder is any individual or company (or sometimes a government) that owns more than 50% of a company’s shares. Because such individuals or entities make a substantial financial investment into the company, they are considered stakeholders. It means they have a vested interest in the company’s performance and…
What is Quality Management? Quality management is the act of overseeing different activities and tasks within an organization to ensure that products and services offered, as well as the means used to provide them, are consistent. It helps to achieve and maintain a desired level of quality within the organization. Quality management consists of four…
What is Broad Factors Analysis? Broad Factors Analysis, commonly called the PEST Analysis, is a key component of external analysis. A Broad Factors Analysis assesses and summarizes the four macro-environmental factors — political, economic, socio-demographic (social), and technological. The factors exert a significant effect on a business’s operating environment, posing opportunities and threats to the…
What is the Industry Life Cycle? Industries, like products and businesses, emerge and eventually decline at specific points in history; the time period between inception and eventual extinction (if applicable) is the industry’s life cycle. Understanding where an industry is in its life cycle is important for financial analysts, entrepreneurs, and other stakeholders when seeking…
What is the Beachhead Strategy? The beachhead strategy comes from the military strategy of winning a small border area that becomes a stronghold, and from which you can advance to the rest of the territory. The small border area is referred to as a beachhead. In business, the idea is to focus your resources on…
What is Passive Ownership? Passive ownership refers to any shareholder in a business who is not involved in the day-to-day decision making of the company’s operations. The shareholders may be involved in some high-level corporate decisions that require shareholder votes, but not in daily operating decisions. Passive ownership mostly occurs when the owners have built…
