ITB SET - 2 PDF

Sk. Mahrufur Rahman, Assistant Professor Department of BA  Ethicsinvolves an individual`s personal beliefs regarding what is right and wrong or good and bad.  Ethical behavior indicate those behavior that conforms to generally accepted social norms.  Businessethics refer...

Sk. Mahrufur Rahman, Assistant Professor Department of BA  Ethicsinvolves an individual`s personal beliefs regarding what is right and wrong or good and bad.  Ethical behavior indicate those behavior that conforms to generally accepted social norms.  Businessethics refer to the evaluation of business activities and behavior as right or wrong.  INDIVIDUAL Moral philosophy Humanistic philosophy Utilitarian philosophy  ORGANIZATIONAL Top Level Mgt. Philosophy The Firm’s Reward System Penalized system  ENVIRONMENTAL Competition Conflict of interest Social/Cultural Institutions  Awareness that business activities have impact on society & consideration of that impact by firms in business decision making. ◦ began to blossom in the 1960s ◦ Social responsibility, as it applies to businesses concerns a company’s duty to Operate by means that avoid harm to Stakeholders/Environment. ◦ Consider the overall betterment of society its decisions and actions. ◦ Ex – “McDonald” recycling stopped polystyrene. RESPONSIBILITY RESPONSIBILITY TO INVESTORS TO EMPLOYEES RESPONSIBILITY RESPONSIBILITY TO TO CONSUMERS ENVIRONMENT  RESPONSIBILITY TO CONSUMERS  -The right to safety  -The right to be informed  -The right to choose  -The right to be heard  RESPONSIBILITY TO EMPLOYEES  -Safety in Workplace  (Adequate Safety Measures, Security of Employees)  -Equality in Workplace  (Selection, recruitment, pay, promotion)  -Hard-core Unemployed  ( Development through training)  RESPONSIBILITY TO ENVIRONMENT  Avoid Water Pollution  (Shouldn’t dump toxics, sewage and garbage into water)  Avoid Air Pollution  (Reduce Carbon footprint, Use environmental friendly inputs)  Avoid Land Pollution  (Reduce Strip mining, forest fire, garbage disposal, Waste Management & Treatment: Recycling)  RESPONSIBILITY TO INVESTORS  -Proper Management of Funds  -Access to Information  -Executive Compensation  Community Support  Self-Regulation  The Social Audit  Business environment consists of the actors and forces outside Organization that affect management’s ability to build and maintain successful relationships with customers. By carefully studying the environment, businessmen can adapt their strategies to meet new marketplace challenges and opportunities.  Like Grameen Phone companies constantly watch and adapt to the changing environment. To compete with the competitors in the competitive market, marketers should have update information and vast knowledge about the marketing environment to take the effective marketing strategies.  A. MICROENVIRONMENT: The microenvironment consists of the actors close to the company that affect its ability to serve its customers - the company, suppliers, marketing intermediaries, customers markets, competitors and public which are discussed in below-  1. The company: In designing marketing plans, marketing management takes other company groups into account - groups such as top management, finance, research and development, purchasing, operations and accounting. All these interrelated groups form the internal environment.  2. Suppliers: Suppliers form an important link in the company’s overall customer value delivery system. They provide the resources needed by the company to produce its goods and services. Marketing managers must watch supply availability - supply shortages or delays, labor strikes, and other events.  3. Marketing intermediaries: Marketing intermediaries help the company to promote, sell and distribute its goods to final buyers. They include reseller, physical distribution firms, marketing service agencies and financial intermediaries.  4. Customers: The Company needs to study five types of customer markets closely. These are consumer market, business market, reseller market, Govt. market and international market. Each market type has special characteristics that call for careful study by the seller.  5. Competitors: The marketing concept states that to be successful, a company must provide greater customer value and satisfaction than its competitors do. They must gain strategic advantage by positioning their offerings strongly against competitors offering in the minds of consumers.  6. Publics: A public is any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives. The company has to design an offer to this public that is attractive enough to produce the desired response.  B. MACRO ENVIRONMENT: Macro environments consist of the larger societal forces that affect the microenvironment- demographic economic, natural, technological, political and cultural forces. Which are discussed below-  1. Demographic environment: Demography is the study of human populations in terms of size, density, location, age gender, race, occupation, and other statistics. The demographic environment is of major interest to marketers because its involve people and people make up markets.  2. Economic environment: The economic environment consists of factors that affect consumer purchasing power and spending patterns. Marketers must pay close attention to the consumers’ purchasing power and consumer spending patterns both across and within their world markets.  3. Natural environment: The natural environment involves the natural resource that are needed as inputs by marketers or that are affected by the marketing activities. Marketers should be aware of several trends in the natural environment.  4. Technological environment: The technological environment is perhaps the most dramatic force now shaping our density. Technological environment is the forces that create new technologies, creating new product and market opportunities.  5. Political environment: Marketing decisions are strongly affected by developments in the political environment. The political environment consists of laws, government agencies and pressure groups that influence and limit various organizations and individuals in a given society.  6. Cultural environment: The Cultural environment is made up of institutions and other forces that affect a society’s basic values, perceptions, preferences, and behaviors. People grow up in a particular society that shapes their basic beliefs and values.  As a Business manager, he should know how to take the opportunities of Business environment and how to overcome it.  1. Production: Production fully depends on the environment. If the environment is not favorable, productions will be hampered. On the other hand more favorable environment causes the increase in on more production.  2. Price: Price level depends on the production cost and govt. tax. Production cost and govt. tax depends on the factors of production and govt. So, if the govt. activities are favorable to business and factors of production are available then price of product will be low. On the contrary unavailability of raw materials and production factors and high indirect tax may increase the price level.  3. Distribution: Modern business concept requires better service for customer. Proper distribution of product and services is possible only when, there exist good communication and transportation system. As an example, in Africa, there are some remote areas, where people do not get their basic needs for live, due to poor communication system.  4. Marketing promotion: Marketing promotional mix includes advertising, sales promotion, public relation, and selling, each of them is greatly influence by environment. For example in an Islamic country it is restricted to advertise of win for its promotion.   5. Marketing cost: Marketing cost depends on the channel level, competition, and distribution, each of its cost is determined by marketing environment. Marketing cost may higher if there exist high channel level and competition and high distribution cost.  6. Marketing strategy: Before taking strategy company should consider its environmental factors. If the strategy goes against the social beliefs then the company should give up these types of straggly.  7. Marketing planning: Marketing planning indicates when, who, where and how the marketing activities will be done. To do it, one has to think about the environmental factors, otherwise, it will go vain.  8. Total industry and company sales: Industry and company sales affected by environment in various ways. Such as natural calamity, political disturbance and war may the causes of decrease in industry and company sales.  At last we can say that every step of marketing activities is greatly influenced by the environmental factors.