Business Notes - Simplified PDF

MARKETING Role of marketing Strategic role - To ensure ongoing success through sale revenues (PROFIT MAXIMISATION) - Key roles - Choice, standard of living, employment, brand awareness, market share Interdependence - All Other functions Ops→Mar -...

MARKETING Role of marketing Strategic role - To ensure ongoing success through sale revenues (PROFIT MAXIMISATION) - Key roles - Choice, standard of living, employment, brand awareness, market share Interdependence - All Other functions Ops→Mar - Research to know what to produce Mar→Ops - Rely on ops to create a product that meets the needs of target market Ops→Fin - Funds to execute different activities (production line) Fin→ops - Inefficiency in production could affect budget Ops→HR - Quality expectation of staff HR→Ops - To implement and monitor WHS practice Production, selling, marketing approaches - Assumption of highest quality, no research, higher price - Persuading, promotion, personal selling/advertising - Research, consumer at centre, newest Types of markets - Commercial markets - Goods not sold (more purchasing) - Resource - Primary production - Industrial - Organisations, purchase from production - Intermediate - Wholesalers/retail, use finished goods to create others - Consumer market - Individuals, families, households - Mass - Single product (everyone) - Consumer (segmented) - One market - Niche - Specialised Influences on Marketing Factor influencing customer choice Psychological - Personal motivation, perception, personality, attitudes, learning, lifestyle Sociocultural - Family, friends, culture (religion & ethnicity) Economic - income, savings, economic trends Government - Legislation, regulations, economic policies, restrictions Consumer laws - Protects, Competition and Consumer Act 2010, fair and competitive Deceptive & misleading - wrong information, fake discounts, overstating benefits, using bait Price discrimination - Anti competitive practice, Lower prices than competitors offer Implied conditions - Description given, full working, fault/fit for purpose Warranties - Implied warranties (can be combined) Ethics - A business experiencing backlash from the public Truth, accurate and good taste in advertising - Self regulated, federation of Australia Products that may damage health - goods/service that can be health detriment Engaging in fair competition - Price fixing, long term loss leader Sugging - General questions to determine preferences, this is wrong Marketing Processes Situational Analysis SWOT - Strengths, Weaknesses, opportunities, threats Internal - Strengths, Weaknesses External - Opportunities, threats Product life cycle Establishment - Sale growth, awareness, limited profits, lack of revenue Growth - Core customers, loyalty, growing, profitability Maturity - Sales slow, steady income, competing, available Post maturity - With decline renewal, steady state, cessation Market research Market research - Gather info and data, primary research (data), secondary research (exists) 1. Determine needs 2. Collecting data (P + D) 3. Analyse and interpret data - Primary research - Observations, experimental - Secondary research - internal (collected, annual reports), External (commercial, government and trade research publications) Establishing market objectives - Develop aims, to achieve objectives, guides, goal setting through SMART Identifying target markets - Target specific groups (mass, segmented, niche) Developing marketing strategies - Marketing mix (product, price, promotion, place) Product - Good/service exchanged for money Price - Money customer prepared to pay Promotion - Used to inform, persuade remind Place - Distribution channel to get a product to consumer Implementation, monitoring control - financial forecast, actual and planned results, revising marketing strategy - Implementation - marketing plan, organising, - Monitoring - Comparing actual with planned results - Controlling - Making adjustments 1. Alternative MS, forecast predicting costs/revenues and cost estimate and revenue estimates 2. Measuring success - Sales analysis, market share analysis, marketing profitability analysis 3. Assess objective is being met, based on plan workout renewal, establishment and cessation Marketing Strategies Market segmentation, product/service differentiation and positioning Market segmentation - Target market, demographics, geographics, psychological, behavioural Product/service differentiation - making minor changes, additional value added, Positioning - Creating identity for a product to separate themselves Products - Goods/Service Branding - Name, term, symbol, adds value to business Packaging - Luxury exclusiveness, encourage first time customers Price (pricing methods) Cost based - Determines cost one product then adds price to cover additional costs Market based - Setting price to supply demand (LP = HC, HP = LC) Competition based - Set by competitors, gain market share, price equally (create impressions) Pricing strategies Price skimming - Highest possible price Price penetration - lowest possible price Loss leader - Below cost level, no profit made Price points - One of a few standard prices to create a range of goods to convince the consumer to upgrade Price and quality interaction - High quality product = high price - Perceive price to quality relationship Promotion Elements of promotion mix Advertising - Convey message, inform or persuade (media, newspaper) Personal selling - Building and maintaining long term, high level of customer satisfaction Sales promotion - Interest in awareness, discounts, samples Publicity and public relations - Event to generate awareness (makeup, skincare) The Communication Process Opinion leaders - business leader recognise community (highly respected)_ Word of mount - Business have little to no direct influence, consumer reactions to use of product Place distribution Distribution channels - Paths products move, communication technologies allow for new distribution ways (telemarketing, internet marketing) Channel choice - Intensive, selective, exclusive Intensive - Saturated though market Selective - Limited no. of retailers Exclusive - Minimal distribution Physical distribution issues Transport - depend on type of product, level of care to move Warehousing - Costs & efficient need to central organising plan to receive store and deliver product Inventory - Maintaining product quantity and variety appropriate for target market People, processing and physical evidence People - Quality of interaction between C & E Processing - Flow of activity following delivery service Physical evidence - Env. which good/service will be delivered E-marketing - Opportunities to interact with C, personalised marketing, sales growth brand awareness, reach global audience Global marketing Global branding - recognisable name/logo, more effective and efficient to promote brand Standardisation - Differentiated, suit different cultures/local markets, difference in language, religion tastes and ethics Customisation - local approach, more expensive to implement, expensive in long run Global pricing - Occur when consumer is in different countries charred as a different price for same product, Competitive advantage - Determining how to differentiate themselves, requires more time to develop customer and brand awareness OPERATIONS Role of Operations management Strategic role - Cost leadership, good/service differentiation - Improve productivity, efficient and quality of outputs Cost leadership - Lowest cost manufacturer (Ikea,Aldi) Good/service differentiation - Sustainable advantage, better quality, faster delivery, customer designed products Goods/services in different industries Interdependence of business functions - Differences with manufacturing and service based businesses - One tangible the other not Interdependence of business functions Ops→Mar - Research to know what to produce Mar→Ops - Rely on ops to create a product that meets the needs of target market Ops→Fin - Funds to execute different activities (production line) Fin→ops - Inefficiency in production could affect budget Ops→HR - Quality expectation of staff HR→Ops - To implement and monitor WHS practice Influences Globalisation, technology, quality expectations, cost based competition, government policies, legal regulations, environmental sustainability Inputs Globalisation - National economies, opportunities, trade agreements, different agreements, global consumers, diverse cultures Technology - knowledge & equipment available, new methods Quality expectations - Goods - Durability, reliability and fit for purpose Service - Professional, reliability and customisation Cost base competition - Price advantage over competitors, Increase sales & market share Government policies - encourage or discourage particular business activities Legal regulations - ensure safety and fairness, covering env protection, health and industrial relations Environmental sustainability - Development and use of methods of production that allow resources to be used w/o limited future genes. Corporate social responsibility - Taking action morally and ethically correct (best interest of community) Legal compliance Vs Ethical responsibility - Legal is the law (must be followed), ethical is thought of doing the ‘right’ thing Environmental Vs Social - Env. sustainable goals that make contributions to society (better quality of life), social is taking both ethical and legal action that are expectable Operations Processes Inputs - Transformed resource, transforming resources Transformed - Changed / Converted (materials, informations and customers) Transferring - Remain in business (human resources, facilities) Transformation process - Physically altering physical input, transportation of good, protection and safety Volume - No. of goods/service that process need to produce Variety - Different models offered by business Variation in demand - Change in consumer need (respond through production) VIsibility (customer choice) - Degree which customers can see the operation in action Four V’s affected by PLC Sequencing and Scheduling Gantt Charts - Records number of tasks, set specific dates for tasks, used for production scheduling Critical path analysis - Scheduling tool for repeated tasks, it shows the shortest path (all task must be completed) Technology, task design and process layout Technology - Advance product, more innovations Task design - Separate steps, improves efficiency, continuous improvement Process layout - Arranged activities, specialised function, adds value Monitoring, control and improvement Monitoring - collecting information about performance (quality, speed, dependability, flexibility, customisation, costs) Control - Comparing observed to planned Improvement - Determining what can be changed to improve (quality, speed, dependability, flexibility, customisation, costs) Outputs - Customer service, warranties Customer service - intangible, increase customer satisfaction leading to competitive advantage Warranties - Under Australian law - Level of quality, suitability, match description, free from defects/faults Operations Strategies Performance objectives Quality - Standards are met Speed - Producing at high rate = fast distribution Dependability - Providing outputs where and when needed Flexibility - Change to meet evolving customer demands Customisation - Ability to meet individual requirements Cost - Producing with low price of input to compete in market New product or service design and development - Must be designed to ensure competitive advantage, new service should be upgradeable, lengthy and expensive, not all are successful Supply chain management Logistics - Distribution, transportation, models, materials handling and storage, warehousing and distribution centres. E-commerce - Enables business to source through online to one another Global sourcing - Purchasing where no location constraints (expanded over national boundaries) Outsourcing - Hiring a part outside company to perform services (traditionally done inhouse) Advantages - Reduce costs, specialist, better access to tech, experience, speed and quality Disadvantages - Loss of control, copying, stakeholder breakdown, slower lead time, affect operations Technology - New innovations that can change good/service (product), innovation that improves production of good/service (process) Leading edge - Newly developed, Established - Tried, proven and/or widely used Inventory management - Transformed resource aiming to maximise sales, identify underperforming stock, minimise costs, identify costs and have enough cash on hand Holding stock - Holds stock to reserve supply for increased demand - Ads - Easy access, reduce bulk costs, advantage of seasonal buying - Dis - Too much space, stock must be insured LIFO - Newest stock deliver first FIFO - Oldest stock is sold first JIT - Stock arrives as needed (minimal holding) Quality management Control - Checking at al intervals Assurance - Standards, proactive process, fitness for purpose, right first time Improvement - Continuous improvement and total quality management, holistic approach Overcoming resistance to change Financial costs - Costs cause concern by business owners and operations managers who need to manage change Purchasing new equipment - investment, capital costs (high), improved flexibility, more consistency and high quality Redundancy payments - Job skill no longer needed Retraining - Requiring change to acquire different work, achieve through training or purchase of new tech/equipment Reorganising plant (facilities) layout - requires extensive or menial reorganisation to improve systems 1. Use of models of change 2. Use of management consultants 3. Use of change agents Global factors Global sourcing - Less expensive, less cost region, global web strategy to reduce ops costs Economies of scale - Lower cost per unit, more purchased less expensive Scanning and learning - identify and learn critical global trends (may impact business) Research and development - Innovation strategy that includes new products or improvement of existing ones