Marketing 3104 Lecture: Contingent Workers, Culture, Improvement, and Planning - Prof. Jer, Study notes of Introduction to Business Management

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MKTG 3104 Page 1 Lecture 9/9/08 This week in the news: - Google being investigated on anti-trust issues - Company leaders need to be cognizant of environmental issues - Wachovia suffers from buying company but prof. still considers stable company - Fanny Mae & Freddy Mac bail-out (our tax dollars being used to help out poorly managed companies, auto companies also want part of the handout, will other companies start asking for federal bail-outs, what does each political candidate support) - Good Sources of Info: Business Week, Wall Street Journal, Time, Newsweek, U.S. News, USA Today, Washington Post, The Economist, etc Finishing Up Chapter 2: Contingent Workers: - Part Time Workers: o Work less than 40 hrs per week o A good source of staffing for peak hours o May be involved in job sharing - Temporary employees: o Generally employed during peak hours (Ex holidays) o Can fill in for employees for an extended period of time o Create a fixed labor cost during a specified period - Contract workers o Are hired by organizations to work on specific projects o Are paid by when the firm receives particular deliverables o Are a labor cost that is fixed by contract Making a Company’s Culture More Customer Responsive: - Actions that create employees with the competence, ability, and willingness to solve customer problems as they arise: o Selection: hiring the right personalities and attitudes o Training: developing the customer-focus employees o Organizing: creating customer friendly controls o Empowerment: independence in relating to customers o Leadership: commitment to the customer-focus vision o Evaluation: performance measured by behaviors/observation o Rewards: contingent on outstanding customers service www.personalitypathways.com/type_inventory.html Meyers-Briggs type testing site/info (read this) www.humanmetrics.com/cgi-win/types1.htm www.colorcode.com Increased Concern for Quality: - Continuous Improvement: o Organizational commitment to constantly improving the quality of a product or service  Joseph Juan  W. Edwards Deming  Why their work in Japan and not U.S.? MKTG 3104 Page 2 Lecture 9/9/08 o Kaizen: the Japanese term for an organization committed to continuous improvement - Work process engineering: o Radical or quantum….. Components of Continuous Improvement: 1. Intense focus on the customer 2. Concern for continuous improvement 3. Improvement in the quality of everything the organization does 4. Accurate measurement 5. Empowerment of employees 6. Internal and External ‘customers’ CHAPTER 3: FOUNDATIONS OF PLANNING Planning: How Defined 1. Defining the organization’s objectives or goals 2. Establishing an overall strategy for achieving these goals 3. Developing a comprehensive hierarchy of plans to integrate and coordinate activities - Planning is concerned with ends (what needs to be done) and means (how it is to be done) - Who does most of the planning within an organization? THE BULK OF THE PLANNING IS DONE AT THE TOP LEVELS OF AN ORGANIZATION Reasons for planning: circular diagram in book (Managers engage in planning to:) Planning and Controlling go hand in hand: Controlling is a way of checking the effectiveness of the planning Criticisms of Formal Planning: - Planning may create rigidity & not adapt to change - Plans can’t be developed for a dynamic environment! (long term vs. short term planning) - Formal plans can’t replace intuition and creativity (plans can incorporate and share w others) - Planning focuses managers’ attention on today’s competition, not on tomorrow’s survival - Formal planning reinforces success, which may lead to failure (same old ways) Tom Peters: “if it’s not broken, break it” (things will break in time, might as well do it yourself before the economy does) Planning-performance Relationships: - Formal planning generally means higher profits, higher return on assets and other positive financial results (research) - Planning process quality and implementation probably contribute more to high performance than does the extent of planning *Participation builds commitment (people like getting involved in planning- if a person helps plan a task then they usually dedicate themselves to making sure the plan works) - When external environment restrictions allowed managers view viable alternatives… (Ex no government interference) MKTG 3104 Page 5 Lecture 9/9/08 o Accurate information about competitors that allows managers to anticipate competitors actions rather than merely react to them (and plan for such) (sometimes unethical..) SWOT Analysis (not SWAT) (analysis that companies must make of themselves) 1. Strengths (strategic) a. Internal resources that are available or things that an organization does well i. Core competency: a unique skill or resource that represents a competitive edge 2. Weaknesses a. Resources that an organization lacks or activities that it does not do well 3. Opportunities (strategic) a. Positive external environmental factors 4. Threats a. Negative external environmental factors *See SWOT diagram in text Grand Strategies: Michael Porter - Growth Strategy o A strategy in which on organization attempts to increase the level of its operations - Stability Strategy o A strategy that is characterized by an absence of significant change (status quo- working well) - Retrenchment strategy o A strategy characteristic of a company that is reducing its size, usually in an environment of decline (ex General Motors) - Combination Strategy o The simultaneous pursuit by an organization of two or more of growth, stability, and retrenchment strategies (ex GM might want to reduce size of truck segment and increase size of hybrid segment) Growth strategies: - Direct Expansion o Involves increasing a company’s size, revenues, operation, or workforce… usually why? - Merger o Occurs when two companies, usually of similar size, combine resources to form a new company, Why? - Acquisition o Occurs when a larger company buys a smaller one and incorporates the acquired company’s operations into its own (absorbed and disappears) o QUESTION ON DIFFERENCE BETWEEN MERGER AND ACQUISITION- Competitive Strategies - Strategies that position an organization in such a way that it will have a distinct advantage over its competition o Cost leadership strategy  Becoming the lowest-cost producer in an industry (dangerous tactic) o Differentiation strategy MKTG 3104 Page 6 Lecture 9/9/08  Attempting to be unique in an industry with a broad market o Focus strategy  Attempting to establish an advantage (such as cost or differentiation….fuck) Sustaining a competitive advantage - Competitive advantage counts for little if it cannot be sustained over the long term o Factors reducing competitive advantage  Evolutionary changes in the industry  Technological changes  Customer preferences  Imitation by competitors o Defending competitive advantage (co. wants)  Patents, copyrights, trademarks, regulations, and tariffs  Competing on price  Long-term contracts with suppliers (and customers) Quality as a strategic weapon - Benchmarking o The search for the “best practices” among competitors or non-competitors that lead to their superior performance (USDOC/Senate) - ISO 9000 Series (and 14,000 series) o Standards designed by the international organization for standardization (ISO) that reflect a process whereby independent auditors attest that a company’s factory, laboratory, or office has met quality management …..