Exam3Notesallchapters.pdf

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Westfield High School, Westfield**We aren't endorsed by this school

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AC 217

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Economics

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Dec 20, 2024

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Exam2Chapternotes:Chapters1,2,3,6,7,9,10,11,12,16Chapter 1:Business= an organization that seeks profit by offering products to satisfy society’s needs.Products could be goods or services Good= a tangible product Service= is an intangible product*A business realises a profit when its sales revenue is greater than its expenses(Page 25)*economy is made up of businesses, public sectors(government), and non-profit sector(pg26)From the start of the Industrial Revolution until the early 20th century, business had a strong production orientation, in which emphasis was placed on increased output and production efficiencyFor a Business to be successful you need 4 types of resources-Material-Human-Financial-InformationalHowcompaniesofferVariety-Increasing quality-Increased choice-Increased convenience-Increased health and safety-Increased value for moneyPg 28 Five Factors of the business environment: TECGS-Technology:changesindevelopmentanddistributionandcommunication-Economic: size and health of the economy-Competitive: forces a company to focus on strategies ie: cost cutting, development, marketing-Global: related to competition business all over the globe-Social: change in demographics, age, gender, ethnicity etc.Capitalism: is an economic system in which individuals own and operate the majority ofbusinesses that provide goods and services. (private)A free market economy: an economic system in which businesses and individuals decide what to produce and buy and the market determines prices and quantities sold.

Invisible hand: when individuals act to improve their own fortunes, they indirectly promote thegood of their community and the people in that community (30)

Monopoly:entering theCanada has a mixed economy Mixed Economy: where most land of government involvement- Capitalist andsocialistCommand Economy: government decides what goods and services will be produced and how they will be produced for whom and who owns/ controls factors of production- an economy system in which a centralized gov determines the answers to all 3 basiceconomic questions.-Socialism : key industries are owned and controlled by the government-Communism: all property and profits are owned by the government which then decides what goods and services will be sold4 Degrees of competition (Pg 31): (Page 31 for ex)Perfect competition: many buyers and sellers of a product in the market and no single buyer or seller is powerful enough to affect the price of that product. All the products are almost the exact same. (It is uncommon in the real world for this to happen) Prices are determined by supply and demand. Minimizes cost of production.-In perfect competition, sellers—and buyers—must accept the going price. The price of each product is determined by the collective actions of all buyers and all sellers throughthe forces of supply and demand. The key strategic consideration where there is perfect competition is to minimize production costsMonopolistic: has many buyers and sellers, but the products vary because they features. They want their product to stand out alot, making it monopolistic. (most world). It is called monopolistic because each company has a monopoly on that exact version of the product they are selling.-Restaurants–restaurantscompeteonqualityoffooddifferentiation is a key element of the business. There in setting up a new restaurant.as much as price. Product are relatively low barriers toOligopoly: situation in which there are few sellers. The sellers are quite large and sizableinvestments are required to enter the market. The sellers match prices and then try to win customers over with product differentiation.- Examples: Automobiles and AirlinesOneseller,manyindustry.buyers, with lots of barriers to keep other companies from-Microsoft. Because many computer users have standardized on software products compatible with Microsoft's Windows operating system, most of the market is effectively locked in, because the cost of using a different operating system, both in terms of acquiring new software that will be compatible with the new operating system and businesses are privately owned but with various levelshave unique common in theentry

and

because the learning curve for new software is steep, people are willing to pay Microsoft's high prices for Windows.In which case is there no domination by any buyers and sellers?-many buyers and many sellersSupply and demand concept questions:If there is a decrease in price- Supply down, Demand Up If there is a Increase in price-Supply up, Demand downEquilibrium price/market price: price of any product at which the quantity demanded is exactly equal to the quantity suppliedLaw of supply: as the price increases, the quantity supplied increases. (shown graphically by an upward sloping supply curve)Law of demand: as price decreases the quantity demanded increases (shown graphically by a downward sloping demand curve)*Oligopoly-type industry may use game theory(34)Game theory: used to model the interaction between two or more businesses to determine what will happen if one or more companies take specific actions with regard to changing prices or introducing new products or services(34) Business cycle:Peak: when you are making the most moneyContraction or recession: when an economy shrinks in 2 quarters in a row. Involves people losing jobs and drop in household income.Trough: When a country’s economy bottoms out and a country’s production and employment reaches the lowest pointExpansion:When the economy is growing, that is called an expansion

GDP (Gross domestic product): it measures whether an economy has grown or shrunk.GDP is the total dollar value of all goods and services produced by all people within the boundaries of a country during a one year period.Unemployment rate: percentage of a country’s labour force unemployed at any time.UNEMPLOYED/LABOURFORCEInflation: is an economics statistic that tracks the increase in prices of goods and services over a period of time.* Inflation is usually measured using the consumer price index (CPI): a monthly index that measures the changes in the prices of a fixed basket of goods purchased by a typical consumer in an urban area.Deflation is a general decrease in the price of goods and services(Opposite of inflation)●Understanding indicators of economic health can help individuals, business and gov better allocate their resources and plan for the future.-Whether to change the levels of taxation and government spending to influence the economy (this is called fiscal policy)-Whether to make changes to the money supply or interest rates to influence the economy (this is called monetary policy)Lecture notes 1Live theatre and events have been canceled.Keeping people interested through social media interaction, and advertising for next years events.FoodPeople in this industry have suffered greatly due to their unemployment in the industry increasing.Since they are all receiving government checks it would cause inflation.ReactionOrganizations are rescheduling events and also creating the next best alternative such as online events.While also willing to refund their customers. Continuing to have social media presenceEx: drive through graduation, online graduation.Lecture 2 Notes September 15, 2020

Ethical behaviors Preconventional/selfish Conventional (by agreement): SocialPost conventional/principal: I know is wrongPirymadFirst part of business:Make moneySecond:Be legal Third:ethical Fourth:PhilanthropicLesson2Textbook:BeingEthicalandsociallyresponsibleEthics is the study of right and wrong and the morality choices that an individual makes. Business ethics is the application of moral standards to business situations.-Ethical issues usually arise out of a business’s relationship with investors, customers, employees, creditors, suppliers or competitors.Businesses are expected to-Compete fairly and honestly-The first priority is to obey all laws and regulations.-Beyond obeying the law, ethical businesspeople are expected to refrain from knowingly deceiving, misrepresenting, or intimidating others.- Example:-Avoidconflictofinterest-Conflict of interest occurs when a business person takes advantage of a situation for his or her own personal interest rather than for the employer’s interest.- Be Transparent-Transparencyisthefreeflowofinformationinsideandoutsidethecompany.

Social responsibility audits are comprehensive reports of what an organization is doing in regard to social issues that affect it.-This is usually done by making information publicly available.Factors that affect ethics -Individualfactors●Knowledge of an issue● Personal values and goals -Social factors●The law●Cultural norms●are concerned with the law and cultural norms.○ Ie faking sick -Opportunity Factors●Competitive environment●Level of supervision●Enforcement○opportunity is a factor that affects a person's inclination to make either ethicalorunethicalbehaviour.○When employees compete in order to get recognized and promoted, managers are influenced to use this to select the right candidatesSuggestion for filtering your decisions-Understand and Obey the law○Don’t break the law, ex of this could be collusion with other businesses to offer artificially low prices is illegal cause it hurts other potential competitors.●Understand and obey the policies of your industry organization

○Industry standards are an example of policies that need to be followed.○It is possible to follow laws, but still compromise industry standards.●Recognize factors that lead to ethical compromise○Scenarios where it is competitive and where there is little to nosupervision can lead you down a path of unethical decision making. Being aware of the factors helps you prepare and avoidunethical decision making●Ensure your actions satisfy the 3 components of business ethics.○Competing fairly○Transparency○Avoiding conflict of interest

Government's rolein ethics-all businesses that are publicly listed in Canada are required to comply with Bill 198, also knownasthe“CanadianSarbanes-Oxley”ActorC-SOX,whichregulatesinternal controlsonfinancialstatementsanddisclosures.TradeAssociations-Trade associations can and often do provide ethical guidelines for their members. These organizations, which operate within particular industries, are in an excellent position to exert pressure on members to stop engaging in questionable business practices. However, enforcement and authority vary from association to association.-Example: A pharmaceutical trade group that adopts guidelines to prohibit giftsand extravagant dinners for physicians from sales representatives is one example of how trade associations may encourage ethical behaviour*Government can encourage ethical behavior by legislating more stringent regulations.Organizations can promote ethical behavior by-Demonstrate commitment from leadership■Management leads by example and creates an ethical culture-Adopt a code of ethics■A written guide to acceptable and ethical behaviour as defined by an organization■Outlines uniform policies, standards and consequences forviolations.-Designate an ethics officer■Ethics officers come in the form of Human resources manager, or a member of the legal team.■Gives employees someone to consult■Ethics officers exist to clarify and answer questions that may lead to unethical practices.-Protect the whistleblower■An employee who exposes or reports unethical practices within the organization■if they know that they will be safe from cultural consequences they are more likely to be vocal about unethical behavior.Ethical Dilemmas decisions where every alternative impacts various stakeholders in unpleasant ways.-First step is to remain open and communicate about the choices.-Ethicaldecisionswithstandscrutinywhenthedecisionsaremadetransparentlyandmethodically.

-A decision where every alternative impacts various stakeholders in unpleasant ways is called an ethical dilemmaManager tips for facing ethical dilemmas1.Listen and Learn: Understand the problem or whatever is going on2.Identify ethical issues: understand the viewpoints of everyone involved3.Analyse the option: do not think emotionally, and consider many alternatives while also getting new perspectives from others. Try to preserve self respect.4.Identify the best option: test against the criteria of respect, understanding, caring, fairness,honesty,andopenness5.Explain your decision and resolve differencesManagers are advised to methodically navigate their decisions through communication and openness.Social responsibility: the recognition that business activities have an impact on society, andthat those impacts are to be considered when making decisions. There are 2 models of socialresponsibility.●Economic model of SR: society will benefit most when business is left alone to produce and market profitable products that society needs. Companies that believe this think they achieve their social responsibility by just doing their job and providing what a basic business provides.○This model believes that social concerns should be addressed by gov and social institutions.○They believe that business managers are responsible primarily to shareholders and have too focus on returning an investment.○Corporate time, money, and talent should be used to maximize profit, and not deal with societal issues○expanding a company in order to hire more employees○Social problems affect individuals, so why should a business be expected to solve individuals problems?●Socioeconomic model of SR: here managers believe they have a responsibility to not only shareholders, but to customers, employees, suppliers, and the general public. This model places emphasis on the businesses decisions on society.○They believe that since business is part of our society it cannot ignore social issues.○Business has the resources needed to tackle today’s complex social issues○By helping resolve social issues, business can create a more stable environment, businesses can make more money in that society.

○It can also prevent the gov from stepping in and forcing them to do what they don't want to do. Keep the gov from giving them guidelines*In the world no one ispurely socioeconomic,or economically modeled, they have achieved a middle ground because everyone expects some level of socialresponsibility from businesses.●Stakeholder: is considered to be an individual group, or organization that has a vested interest in the business○Investors○Employees○Customers○Consumers●Caveat emptor: a latin phrase meaning “Let the buyer beware” or in other words “whatyou see is what you get”. If it is not what you expected too bad.4Basic Consumer rights (Infographic is page 51)----RightRightRightRightto Safety to be Informed to choose to be HeardEmployment equity: increased representation of minority groups in the workplace through provision of equal opportunities for allCanadian Human Rights Commision (CHRC): ensures federally regulated employers are fulfilling their legal obligation to provide equal employment opportunities to women, people with disabilities, Aboriginal people, visible minoritiesEnvironmental Responsibility

green marketing :The process environmentally safe.of creating, making, delivering, and promoting products that are-Freshii, for example, built its reputation as a green marketer by strictly adhering to its mantra, which includes a promise to “be good to the Earth.”Footnote The company hasalsoadopteda“MissionGreen”andusesbiodegradablecornandpotatoresinformostpackagingrequirements.Sustainability: defined as activities that meet the needs of the present without compromising the ability of future generations to meet their own needs.Lesson3Textbook:GlobalBusiness*This creates many opportunities for the companies to profit and for consumers to benefit by having more choices, lower prices, and access to new cultural experiences. That is the promise of globalization.●A strong interrelationship exists between the political and economic environments and global trade.●Tradeimbalancescanaffecttheeconomicclimateforabusiness.Tradeimbalancesareusually a result of a government policy in both the foreign and the domestic country.AbsoluteAdvantage:theabilitytoproduceaspecificproductmoreefficientlythananyother country.Comparative advantage: the ability to produce a specific product more efficiently than anyother product.Exporting :the selling and shipping of raw materials or products to other countries Importing: the buying of raw materials or products from other countriesBenefits to exporting:-Increased jobs and income-Access to resources -Lower Prices for items -More choices for consumers- resources are allocated to higher priority goods.Trade deficit: when a country imports more than it exports this happens. It is defined as

a negative balance of trade . IMPORTS>EXPORTS=TRADEDEFICIT

Foreign exchange control: control, which is a restriction on the amount of a particular foreign currency that can be purchased or sold.-Exchange-rate changes are determined by a number of factors related to each country'seconomy, including interest rates, inflation, economic strength, and the amount of imports and exports for the countriesCurrency devaluation: this is done to attract international buyers-When the currency of a country becomes weaker, exported products are likely to increase, while imports will likely decrease.-- When there is a shift in currency exchange rates between two countries, exported products are likely to increase from the country with the weaker currency, while imports into the country with the stronger currency will likely increase.Balance of trade: valueofexports-valueofimportsTwo most common types of trade restrictions are tariffs and quotas. -Tariff: a tax on an imported good-RevenueTariffs:imposedsolelyforincomefortheGovernment-ProtectiveTariffs:protectdomesticindustryfromcompetitionbykeepingcompeting imports of the same or higher price-Quota: limiting of the amount of a good that is allowed into the country*Tariffs and trades help the domestic producer by letting them have a piece of the market, while it hurts the domestic consumer because it raises prices on imported goods they might want. Tariffs help the gov because they get taxes from the imported goods.Many economists believe that there should be managed trade through trade agreements. What is NOT one of their arguments for managed trade?-more consumer choiceThe immediate and long-term consequences due to trade restrictions within trade agreements include higher prices for consumers; restriction of consumer choices; misallocation of resources to weak or dying industries; and increased hostility between nations.--A tax on a particular foreign product being imported into a country may be called an importduty,animporttariff,animporttax,acustomsduty,oradutyrate.Animport quota is a limit on the amount of a particular good that may be imported into a country during a given period of time. See

TheWorlddevelopingWTO ( worldservices andEmbargo: a complete halt of trading with a particular country or of a particular product.Reasons forTraderestrictions-Protect new or weak industries-Protect domestic jobs-Protect the health of citizens-Retaliate for another country’s tradetrade organization) ideas.solves trade disputes, and incorporates trade in goods and-Primary objective to reduce barriers to trade worldwide-If Canada wants to export its woodpile and a small country wants to buy wood pulp fromCanada, what organization must the two countries work through to remove any trade barriers that could prevent the deal?IMF ( International Monetary Fund) gives loans to help stabilize economies. They want stableexchange rates.low interest loans and grants to fund development projects in-Help developingcountries build a viable economyThey all aim to promote global economic development through increased trade, stable economies,andreducedpoverty.*economic community organization of countries formed to promote the free movement of resources and products among its members (also referred to as regional economic integration.-Goal is to lower tariffsBank providescountries.

Businesses contribute to communities by providing employment, paying taxes and charitable giving

Methods of Entering International BusinessEXPORTINGANDSHIPPINGLetter of credit: document issues by a bank on request of an importer stating that the bank will pay an amount of money to a state beneficiaryBill of Lading: document issue by a transport carrier to an exporter to prove that merchandise has been shippedDraft: document issued by the exporters bank ordering the importer's bank to pay for the merchandise, thus guaranteeing payment once accepted by the importers bank.CONTRACTUALAGREEMENTSLicensing: one company permits another to produce and market its products in return for royalty or compensationFranchising: similar to licensing, includes provisions on how the business operates, marketing materials, purchase agreements etc.Subcontracting: specify duties of a partnering companyINTERNATIONALDIRECTINVESTMENT-Method for entering international business that provides complete control over operations. Includes acquisitions, joint ventures and creation of totally owned facilities in foriegn markets-Substantial increase in international tradeAcquisition: involves purchase of an existing company in a foriegn country.Ie: Marriott International purchase Delta hotels and resorts to expand into Canada

Joint Venture: is a creation of a separate company that will be run jointly by partnering companiesStrategic alliance: a partnership is formed to create a competitive advantage on a world wide basis.-CompaniesthatmakedirectinvestmentsinternationallyincludeaCanadiancoffeebusinesspurchasingacoffeeplantationinCentralAmerica,andtwobusinessesindifferentcountriesjointly operating a new company to the benefit of both businesses.Chapter 6: Understanding the Management ProcessFour Key Functions of Management1.Planning: establishing organizational goals and deciding how to accomplish thema.If you are forecasting projections in business plan you are forecasting goals forplanning2.Organizing : the company is arranging resources and activities in a way that effectively and efficiently accomplishes the stated goals. Grouping resources and activities to accomplish some end result in an efficient and effective manner3.Leading and motivating: influencing people to work toward a common goal and providing reasons for people to work in the best interests of an organization4.Controlling: is the process of evaluating and regulating ongoing activities to ensure that goals are achieved.-CleanSmart instituted a new smartcard credit system for its cleaning machines. A few months after instituting the program, the company noticed customers' complaints about the actual cleaning machines are up. Derrick is assigned to determine the issues. After an investigation, Derrick determines that customers are now using the smartcard credit system, but the service reps are now only attending to the smartcard credit machines and are forgoing maintenance on the actual cleaning machines, causing issues for customers. By investigating and addressing the issues, the company is engaging in which function of management?Management: coordinating people and other resources to achieve the goals of an Planning: establishing organizational goals and deciding how to accomplish them-Strategic: is broad based and determines the goals and plans for the entire organization, typically for 1 to 5 years-Tactical: each functional area determines its own goals and plans, which enables that area to fulfill its role in achieving the overall strategic plan, typically less than one year-Operational: each unit within each functional area determines goals and plans toimplement those at the next higher level, typically the day to day operations-Contingencyplans:“whatifplans”allowsorganizationstorespondtosituationsthatwould render their current plans unsuitable.organization

Vision Statement: a clear and concise outline of an organization's values and goals that it would like to achieveMission statement: clear and concise articulation of how the company intends to achieve its vision- how it is different from its competition and the keys to its successStrategic planning process: establishing an organization's major goals and objectives and allocating resources to achieve them.StrategicTacticalOperationalContingencyBroad guide for majorpolicy settingDesigned to achievelong-term goalsSet by board of directors and topmanagementSmaller-scale plan toimplement strategic planMay be updatedperiodicallyEasier to change than strategic plansDesigned to implement tacticalplansPlan is one year orlessDeals with how to accomplish specificobjectivesOutline of alternativecourses of action if other plans are disrupted ornon-effectiveUsed in conjunctionwith strategic, tactical, and operational plansOrganizing: grouping resources and activities to accomplish some end result in an efficient and effective mannerLeading: the process of guiding others toward the achievementMotivating: the process of providing reasons for people towork organizationof organizational goals in the best interests of the- Together/combined itisknown as DirectingControlling: is the process of evaluating and regulating ongoing activities to ensure that goals are achieved.SWOT Analysis: a tool for identifying and evaluating business strengths, weaknesses, opportunities and threats. It can be used during the strategic planning process to set goals and objectives.-Strengths: internal capabilities and core competencies ( approaches and processes that a company performs well that may give it an advantage over its competitors) that give the company and advantage over its competitors. Strengths that are positive for the company

-Weaknesses: internal limitations a company faces in developing or implementing plans. Weaknesses are potentially negative for the company. Ie Labour dissention-Opportunities:externalconditionsinthebusinessenvironmentthatcouldproduce rewardsforthecompanyifproperlypursued.Opportunitiesarepotentiallypositiveforthecompany.-Threats:externalconditionsorbarriersinthebusinessenvironmentthatcouldpreventthe company from reaching its objectives. Threats are potentially negative for the company.Benefits ofSWOT:-Identifying-Identifying-Identifying-Identifyingstrengths can help identify opportunities.weaknesses that can easily be fixed may reveal opportunities. weaknesses can help define threats.strengths can lead to strategies for avoiding threats.TypesofManagersClassified in two ways1.According to their level within an organization2.According to their area of management-Top Managers: an upper level executive who guides and controls an organization's overall fortunes-Middle Managers: a manager who implements the strategy and major policies developed by top management-Front Line managers: a manager who coordinates and supervises the activities ofoperating employees (those with no employees reporting to them)Areas of management Specialization-Finance managers: primarily responsible for an organization's financial resources-Because this department affects the entire business, many of Canada's CEO's got their "basic training" as a manager in which department?-Operations managers: manages the systems that convert resources into goods and services-Marketing managers: responsible for facilitating the exchange of products between an organization and its customers or clients-Human resources managers: charged with managing an organization's human resource programs-Administrative managers: a manager who is not associated with any specific functional area but provides overall administrative guidance and leadershipSuccessful Key Skills-Conceptualskills:theabilitytoseethe“bigpicture”andunderstandhowtheparts of an organization or idea can fit together-Technical skills: specific skills needed to accomplish a specialized activityvarious

-Interpersonal skills: dealing effectively with other people both inside and outside an organization. Examples include the ability to relate to people, understand their needs and motives and show genuine compassion.Asyoumoveuptheladderyougenerallyacquiretheseskillsinthisorder Technical→conceptual→interpersonalStyles of LeadershipLeadership: is the relationship between a leader and the followers who want real changes, resulting in outcomes that reflect their shared purposes.1.Autocratic Leadership : style of leadership where the leader makes decisions and the employees are expected to execute the decisions exactly as directed2.Participative leadership : style of leadership where the leader consults employees before making decisions3.Laissez-faire leadership: a style of leadership where the leader provides a basic vision and the necessary resources for the team, and then mainly acts as an adviserManagerial Decision makingDecision making: the act of choosing one alternative from a set of alternativesMakingquality decisions-Correctly identify the problem : Often, a symptom can be misdiagnosed as a problem.Declining production at a factory is a symptom; a machine that is working improperly might be the problem. Or understaffing of that machine might be the problem. A quality-control technique used to find the root cause of an issue is called the “5 whys” technique.Teammemberstrytoidentifyaproblem,thenaskwhythatproblemhappened. They do that five times, with the hope that they will arrive at the true root cause.-Use creativity-Use structured analysis to evaluate alternatives : While some decisions may be small and have somewhat obvious answers, more important decisions require careful analysis. Final decisions are influenced by a number of considerations, including financial constraints, time limits, and resource availabilityChapter 8: Creating a Flexible OrganizationOrganization design: an organizational structure that results from decisions regarding job design, departmentalization, centralization of authority and span of managementFour common objectives companies evaluate when building their organization1.Efficiency2.Control3.Responsiveness4.Empowerment

Efficiency: ability to complete a task using the minimum amount of resources.Control: ability to make decisions and specify how those decisions will be carried out. Responsiveness: is the speed at which the organization can improve its products in response to customer feedback, employee suggestions or competitive pressures.-Ability to be flexible and innovative in today's market-involves the company's overall ability to be nimble and innovative in today's-What would an emergency care facility's organizational design most likely be?Empowerment:the degree to whichemployeescan make decisions ontheir own.-Someoftheoutcomesofempowermentareincreasedproductivity,betterquality,improved cost management, all very important especially in an increasing global competitivemarketplaceJob Design: structuring the tasks and activities required to accomplish a business’s objectives into specific jobs so as to foster productivity and employee satisfaction-Can have a very broad set of tasks involving all aspects of a very limited and specific task-Job Specialization: is the separation of organizational activities into distinct tasks, and the assignment of these distinct tasks to different people.-Assembly line-Adam Smith was the first to emphasize the power of specialization-Tocombatproblemswithspecialization,managersimplementjobrotation-It is easier to train people-Specialized jobs:•Are more efficient because employees develop specialized skills for completing the task.•Are more efficient because they eliminate employee changeover time from one operation to the next.•Make it easier to modify production processes without needing to retrain an entire staff.•Make initial job training easier.Job rotation: which is the systematic shifting of employees from one job to another.- For example, a worker may be assigned a different job every week for a four-week period and then return to the first job in the fifth week.-Intel, for instance, offers an internal database of short-term assignments for employees. Job rotation provides a variety of tasks so that workers are less likely to become bored and dissatisfied.Departmentalization: the process of grouping jobs into manageable unitsMost common organized andmarket

criteria - By function-Groups employees who perform the same organizational activity-Ie all marketing, production etc are together-Advantage: Supervision is simplified-Disadvantage: Slow decision making-“silos”whichemployeesemphasizeoftheirdepartmentovertheneedsof the whole organization- By Product- Groups employees who work with a particular good or service sold by the firm.- Larger firms often use this

-Each department handles their own HR, Finance, Marketing, etc activities- Advantages:-Makes Decision making easier- Improves responsiveness- Disadvantages:-Creates inefficiency because of duplication of specialized activities such as finance and HR- By Location-Groups employees according the the geographical area they serve-Can be whole countries (International Firms)-Regions in the country (National Firms)- Several City Blocks (ie: precincts)- Advantages:-Improve responsiveness to the unique demands of the location, the more distinct the needs of the customers, the more useful departmentalizationis - Disadvantages- Creates inefficiency because of duplication of activities- By Customer-Groups employees to the needs of various customer populations-Local car dealership may have one sales staff for individual customers and another to work with corporate fleet buyers,-Advantage:- deal effectively with unique customer groups- Disadvantage:-difficult to coordinate resource needs such as inventory, or admin staffMostly, companies that departmentalize by Product, Location and Customer also are organized by Function as wellDelegation:whenamanagerassignssomeoftheirworktosomeoneelse.Assignresponsibility→grantauthority→assignaccountabilityCentralizationandDecentralizationofAuthorityCentralized organization: an organization that systematically works to concentrate authority at the upper levels of the organizationDecentralized organization: an organization where management consciously attempts to spread authority widely in the lower levels of the organization

acompanywithlotsofcompetitionandalowprofitmargin→CentralizedwithLinestructureAs a new start-up company grows, in order to remain complex and innovative, as well as responsive and dynamic, what will the company most likely do?--> Decentralize the organization.

Span of management: the number of workers who report directly to one manager AKA span of control-Wide : when they have a large number of employees to be in charge of-Good for organizations with standard activities or highly skilled staff-Can lead to a flatter organization, because few levels of management are needed to supervise-Advantages: more efficient and more empowerment-Disadvantages:less management control, less interaction with managementNarrow: manager has only a few employees they are in charge of-Good for organizations where a high level of interaction is required between managers and employees-Leaders to a taller organization because more levels of management are needed-Advantages: more management control, more interaction with management-Disadvantages: higher cost and less empowermentOrganizational height: the number of layers, or levels of management in a businessForms of Organizational StructureOrganization chart: a visual representation of the structured relationships responsibilities and the people given the authority to do those tasks- Displayinternal structureLine structure: an organizational structure in which the chain of command goes directly from person to person throughout the organization-Communication is linear starts at the top then goes to the bottom-Used by small corporations or startupsLine and staff structure: an organizational structure that includes both line and staff positions-Employee may respond to two or more managers who would have different specializations-Larger corporationsMatrix structure: an organizational structure where individuals work on teams and all areas are represented so that conflicting objectives can be balanced and overall goals rather than individual ones become the priority-Employees are put into teams and report to team leaders and other employees of other teams, info may flow up and down and across-among tasks and

Cross-functional team: a team of individuals with are brought together to achieve a common task.- Commonin soft-waredevelopment companiesOrganizational Design and Corporate CultureCorporate culture: the inner customs, traditions-Can be rigid and formal-Creative and informalTypesofCulture-Clan culture: family/ friendly and collaborative-Adhocracy culture: dynamic and innovative, creative risks, employee empowerment-Market culture: competitiveness, get work done, focused on profit,-Hierarchy culture: follow process and procedure, ie Government organizations centralized authorityInfluenced by-Leadership-History-Industry-Workplaceenvironment-DesignInformal Organization: the pattern of behaviour and interaction that stems from personal rather than professional relationships-Boosts morale-Can cause conflict-Ie team building exercises and eventsInformal groups :are created by the group members themselves to accomplish goals that may or may not be relevant to the organization—from meeting for lunch to going bowling to forming a union. Informal groups can be powerful. They can restrict output, or they can help managers through tight spots. They can cause disagreement and conflict, or they can help to boost moraleand job satisfaction.Grapevine:informal communicationsnetworkwithin an organization-Can be separate or-Good for managersfaster than formal to be awareforms of communicationvarying specialities, expertise, and skills thatand values of an organization

5 areas of Human Resources1.Human Resources Management2.Organizational theory3.Organizational development4.Industrial relations5. Organizational Behaviour(industrial psychologists)Human Resources Management (HRM): all of the activities involved in acquiring, maintaining and developing an organization's human resources.Generally consists of 3 phases1.Acquisition*: recruiting and hiring new employees2.Maintenance: encouraging employees to remain with the organization and work effectively3.Development: improving employee skills and expanding their capabilities*Acquisition contains 5 steps1.Planning : determining how many people the company will need2.Job analysis: determining what each of the new employees will need to do includes job description and specification3.Recruiting: finding qualified candidates for the jobs4.Selection: choosing the best candidates to offer the job to5.Orientation : getting the new employee up to speed in his or her new jobMaintenance-Employee relations-Compensation-Fringe benefits: forms plansDevelopment-Traininganddevelopment:introduceandforadvancementopportunities-Potential appraisal:Chapter 9: Attracting and Retaining the Best Employeesof indirect compensation, ie: health care and retirement savingeducate employees on new skills to prepare

Shared ResponsibilityIn small organizations, there handle most HRM duties-As an organization activities.grows a Human resource manager is hired to oversee HRMImportance ofHRM-Effectively recruit and retain employees-Improve and enhance the organization-Maintain a healthy corporate culture-Bridge The gapThe Replacement Chart and Job analysis ReplacementChart: list of key employees and---Toolusedinsuccessionplanning Lists critical job roles in the company Lists current and future jobs to visualizeSkills inventory: is a searchable database containing information on the skills and experience of all present employees. Which can be mined to find candidates for available positionsJob Analysis: a systematic approach that identifies and determines the job duties and requirements and their importance to the organization.●Job Description: a list of tasks and responsibilities for a particular job●Job Specification: a list of the qualifications required to perform a particular job. Includes any skills, knowledge and abilities and experience that candidates must have in order to be considered.Cultural (workplace) diversity: refers to the differences among people in the workforce, including differences in terms of-Ethnicity-Gender-Religion-Age-Physical or learning abilitiesBenefits of Diversity-Marketing Edge-Attracts top talent-Creativity and Innovationtends to be no HR department and line managers or ownerstheir possible replacements within a companykey roles

+ The Employment Equity Act of 1996 requires that companies proactively increase the representation of four designated groups, including people with disabilities.+ The Charter of Rights and Freedoms (1982) includes the right to live and work anywhere in Canada.Recruiting: the process of attracting qualified job applicants 6 steps for a systematic process is1.Attract a candidate pool2.Screen candidates3.Interview candidates4.Compare candidates5.Check references6.Make a job offerCompensation: Payment employees receive in return for their labourCompensationplansmustbe:-Competitive-Fair to keep-Reasonableenough to attract new talent existing employees from leavingto maintain profitTypesofCompensation:salaries,wagesandbenefits●Fringe Benefits : (most common type) forms of indirect compensation including pensions, health insurance and vacation○Retirement and financial benefits: This may include pension plans, RRSP plans, employee stock-ownership plans, and stock options.○Paid vacation or sick leave○Other employee benefits: Examples include tuition reimbursement, child care, wellness programs, free food and drinks, flexible work arrangements, paid time for volunteer work, etc.●Salaries and wages○Hourly Wage: These will vary depending on the positions and job market. Each province and territory in Canada sets a minimum hourly wage.○Salaries:Managerialandprofessionalemployeesareusuallypaidanannualsalary on either a biweekly, bimonthly, or a monthly basis.●Incentives○Piecework and commission: Some employees are paid according to how much they produce or sell. A car salesperson might be paid $600 for each car sold or a3 percent commission on the car’s sale price.

○Acceleratedcommissionschedule:Toencouragehighersales,asalespersoncould be paid a commission rate of 3 percent on the first $50,000 of sales per month, 4 percent on the next $30,000, and 5 percent on any sales beyond $80,000.○Bonus:Abonusisapaymentforreachingaspecificgoal;itmaybepaid monthly,quarterly,orannually.○Profit sharing: A company that offers profit sharing pays employees a portion of the profits over a preset level.Employee benefits currently average nearly 30% of a full-time employee's total compensation, making them a considerable share of any competitive compensation plan. Growth of employee benefits has outpaced wage growth in the last 5 years and has doubled as a percentage of employee compensation in the last 50 years.Orientation: process ofthe acquisition phase ofacquainting new employees with Human resource management.an organization. It is the last step in-Orientation provides information about company policies, salary and benefits, and in some cases other seemingly trivial matters such as parking.-Although this information is very helpful, the more important orientation is about jobassignments, work rules, equipment, and performance expectations provided by the new employee’s supervisor and co-workers.The orientation itself may consist of a short, informal presentation by the employee’s manager, or it may be a more formal, elaborate program involving dozens of people, lasting several days or weeksKey orientation activities1.Complete hiring paperwork2.Learn administrative details3.Employee introductionsTraining: the process of teaching new employees how to do their jobs or teaching existing employees how to do their jobs more effectively and efficiently.Development: the process of preparing employees to assume increased responsibility in both present and future positions-Development- related training: teaches employees various professional and personal skills such as time management, creativity, negotiation, and even positive thinking. Development-related training may also be aimed at preparing employees for advancement in the organizationJob-related training teaches new employees how to do their jobs, or teaches existing employees how to do their jobs more effectively.1.On the job training2.Simulations3.Classroom teaching-

4.Online learningPerformance appraisal: the evaluation of employees current and potential levels of performance to allow managers to make objective human resources decisions. Three main objectives are :1.Evaluate performance against standards

2.Make employee decisions3.Assess HRM practicesLegal EnvironmentLegislation affecting HRM practices are generally aimed at:●Protecting the rights of employees●Promoting job safety●Eliminating discrimination on the basis of race, gender, age, and other characteristicsChapter10:MotivatingEmployeesandTeams|TextbookNotesMotivationBasic success factor: promote employee commitmentMotivation: encouragingpeople to workto their potential-Best interest for the organization-Pursuit of professional goals-Work towards personal goalsEarlyPerspectivesofMotivationTaylor'sScientificmanagement-Scientific management: that scientific principles should be applied to management ofwork and workers.-Job specialization-Implemented a monetary reward for production, however, was found to be an external motivator and did not last long-Proposed job specialization-Taylor'stimeandmotionstudiesestablishedrulesofmotionthatguaranteedoptimalperformance during a given time and reduced the number of movements needed to get work accomplished.-Piece rate system: a compensation system under which employees are paid a certain amount for each unit of output their produceThe HawthorneStudies-Between 1927 and 1932 Elton Mayo conducted two experiments at the hawthorne plant of Western Electric Company in Chicago-The first study was to determine the effects of the work environment on employee productivity. Workers were divided into two groups. The lighting in the workplace was varied for workers in one group but left the same for the second group. Productivity was measured.-Hawthorne was a factory, if employees believe that their bosses care about them reachingtheirpotentialpersonallyandprofessionally,theywillworkharder.

-Employees who are happy and satisfied with their work are motivated to perform better whichinturnincreasesproductivity.-The Hawthorne studies helped set off a human relationsmovement that led to a variety of theories about what motivates people.Emergence of Motivation Theories-Maslow’s Hierarchy of Needs: a motivation theory that sequences human needs in the orderof their importance from physiological needs to self actualization needs.Theory X: a concept of employee motivation generallyconsistentwithTaylor'sideaofscientific management.Assumes that employees dislike work and will function only in a highly controlled work environment. Based on the following assumptions1.People Dislike work and try to avoid it2.Because people dislike work, managers must coerce, control, and frequently threaten employees to achieve organizational goals.3.People generally must be led because they have little ambition and will not seek responsibility; they are concerned mainly about security.-This will result in a highly controlled and autocratic work environment.-Theory Y: a concept of employee motivation generally consistent with the ideas of the human relations movement; assumes responsibility and work toward organizational goals, and by doing so, personal rewards are also achieved. Based off the following assumptions1.People do not naturally dislike work. In fact, work is an important part of all of our lives.2.People will work toward goals to which they are committed.3.People become committed to goals when it is clear that accomplishing the goals will bring personal rewards.4.People often seek out and willingly accept responsibility5.Employees have the potential to help accomplish organizational goals6.Organizations generally do not make full use of their human resources-ERG Theory: (Existence, relatedness, growth) A theory of motivation developed by Clayton Alderfer that better supports empirical research than Maslow’s Hierarchy.1.Existence: concern for basic material existent motivators-

2.Relatedness: The concern for interpersonal relations3.Growth: The concern for personal growthThe Differences between ERG and Maslow➔ The growth stage is comparable to Maslow’s self-actualization and internal esteem needs. The differences between the two theories include the following:➔ Alderfer recognizes that these needs can overlap.➔ Maslow allows for only one need to be primarily pursued at one time; Alderfer allows for different levels being pursued simultaneously.➔ ERG theory accounts for differences in cultures and better explains that different people have different need orders.➔ Alderfer acknowledges that if a higher-order need is not met and the person becomes frustrated, the person will want to increasesatisfaction by moving to a lower-order need (frustration-regressionmodel).-Herzberg’sTwofactortheory:AKAMotivation-HygieneTheorya motivation theory that suggests that satisfaction and dissatisfaction are separate and distinctdimensions-Hygiene is dissatisfaction-Motivation is satisfaction-Herzberg'smaintenancefactorsincludeco-workerrelations,policiesandrules,supervisor quality,abasewageorsalary,jobsecurity,andwhichofthefollowing?(workingconditions)--Maintenancefactors:accordingtoTwo-FactorTheory,jobfactorssuchasjob security,pay,andworkingconditionsthatreducedissatisfactionwhenpresenttoan acceptable degree, but do not necessarily result in high levels of motivation-Prevents dissatisfaction, but provides no motivation-MotivationFactors:accordingtoTwo-FactorTheory,jobfactorssuchas recognition,responsibility,andopportunitiesforadvancementthatincrease motivation, although their absence does not necessarily result in dissatisfaction-Increase motivation, can increase satisfaction but does not cause dissatisfaction if absent.

Likemanypsychologicaltheories,theTwo-FactorTheoryhaslimitations.Forexample, employee pay is interpreted differently depending on the organization. It may be a maintenance factor in most work environments, but in some companies pay constitutes a form of recognition and reward for achievement—and recognition and achievement are motivation factors. The effect of pay may depend on how it is distributed. If a pay increase does not depend on performance (as in across-the-board raises), it may not motivate people. However, if pay is increased as a form of recognition (such as bonuses or incentives), it may play a powerful role in employee performance.-Reinforcement theory: a means of modifying behaviour based on the premise that rewarded behaviour is likely to be repeated, while punished behaviour is less likely to recurReinforcement of behaviours and other theoriesPositive reinforcement encourages the desired behaviour by adding a reward for the behaviour, such as when a retail sales manager praises an employee for meeting a sales goal. Positive reinforcement can involve rewards as simple as saying, "great job," or more formal rewards such as a promotion or pay raise. MOST EFFECTIVENegative reinforcement : encourages the desired behaviour by removing something unpleasant. For example, the retail sales manager might have a policy where the highest-performing sales reps don't have to stay late to complete inventory each night.Extinction discourages behaviour by withholding a reward for the behaviour. Extinction can be hard to manage, because it can create unintended consequences.-Behaviourmodification:asystematicprogramofreinforcementtoencouragedesirablebehaviour.-Equity theory: a motivation theory based on the premise that people are motivated to obtain and preserve equitable treatment for themselves-equitytheory,equitablewithquitthejob.if employees do not feel like their ratio of inputs to outcomes is that of others, they may reduce their efforts, demand a raise, or

-Equity theory is often seen in professional sports, where even highly paid athletesbecomedissatisfiedwhentheyperceiveinequity.Forexample,Aaron Donald, defensive tackle for the Los Angeles Rams, refused to report to training camp unless his contract was renegotiated to be comparable with the contracts of other top defensive tackles in the NFL-Equity theory is most relevant to pay as a reward. Because pay is a very real measure of a person's worth to an organization, comparisons involving pay are a natural part of organizational life. However, it can also apply to the distribution of recognition, promotions, and even job titlesExpectancy theory: a motivation theory based on the assumption that motivation depends on how much we want something and how likely we think we are to get it proposes that an individual will behave or act in a certain way because they are motivated to select a specific behavior over others due to what they expect the result of that selected behavior will be.Goal Setting Theory: suggests that employees are motivated to achieve goals thatthey and their managers establish together-Employee Participation-RewardsTailoredtoemployeeneeds-Collaboration and support of manager provides further motivation-holds that employees are motivated to achieve specific and moderatelychallenging goals. Goal setting has been demonstrated as one of the most effective and measurable management practices of the last several decades.Management by objectives(MBO):motivation technique in which managersand employees collaborate in setting goals.According to the process of management by objectives, the first step is goal setting, whereby top management sets the organization's goals. Goals then filter down through the organization. Managers and ---

employees at various levels then meet to jointly set their goals for performance.

1.Set goals2.Develop action plan3.Implement action plan4.Review performanceUsing Flexibility- Flextime:as a motivatora system in which employees set their own work hours within employerdetermined limits-Job sharing: an arrangement whereby two people share one full time position-Telecommuting: working at home all the time for a portion of the work week-Hybrid working: a blend of working from home, on the go, or at the officeJob enrichment: a method for motivating responsibility and control over their jobs-Job enlargement: a form of job enrichment where an employee is given additional but similar tasks to complete-Job redesign: a form of job enrichment where employees are assigned entirely new tasks that fit their skill sets and the organization's needs-Job rotation: a form of job enrichment where an employee is moved between various jobs for specific periods of timeJob empowerment: making employees more involved in their jobs by increasing theirparticipation in decision makingEmployee ownership: a situation in which employees own the company they work for by virtue of being shareholdersTeamsandTeamwork4Typesofteams-Functional-Cross functional: group of people from different functions working to a similar goal-Self managed-Virtual : a type of team where members are geographically dispersed but communicate electronically.Fastestemergingtrend.GROUPS VS TEAMSemployeesbyprovidingthemwithincreasedvariety,

The advantages of a team are that it can create synergy, increase creativity, satisfy social needs,andincreaseaccuracy.However,commonpitfallsofteamworkincludeconflict,socialloafing,andgroupthinkGroupthink: is a psychological phenomenon that occurs within a group of people in which the desire for harmony or conformity in the group results in an irrational or dysfunctional decision-making outcome.-Engineers of the space shuttle knew about some faulty parts months before takeoff, but they did not want negative press so they pushed ahead with the launch anyway.SocialLoafing:referstotheconceptthatpeoplearepronetoexertlesseffortwhenworking collectively as part of a group compared to performing a task alone. ... When everyone does not put in their full amount of effort because they are part of a group, this can lead to reduced productivity.Team conflict: is an interpersonal problem that occurs between two or more members of a team,andaffectsresultsofteamwork,sotheteamdoesnotperformatoptimumlevels.Teamconflicts are caused by the situation when the balance between perceptions, goals, or/and values of the team is upset, therefore people can no more work together and no shared goals can be achieved in the team environment.-A team of managers comes together to address a given situation. The sales manager only wishes to discuss "why" the project should go through, while the production manageronly wishes to discuss "when" the job should go through, and the operations manager only wishes to discuss "how" the job should go through. What is this team suffering from?-Motivators are usually classified as extrinsic(external factors) or intrinsic(internal factors).Advantages of teamwork

Chapter11:EnhancingEmployee-ManagementrelationsLabour Union:issues involvingan organization that represents workers wages, hours, and working conditions.in dealing with management over-Less than 30% of canandian workforces belong to unions-Focuses on a few industries and job categories-Largest unions in Canada today are-They will remain a powerful force in particular industries, regardless prominence.-Canadian Union of Public Employees (CUPE) : Canada’s largest union, representing over 650,000 members across Canada in various sectors such as health care and education.-Unifor : Canada’s largest private-sector union, representing over 300,000 workers across the country in a wide array of sectors-National Union of Public and General Employees (NUPGE): Represents over 390,000 individuals working to deliver public services. NUPGE has 11 component and 3 affiliate unions.First major Unions-Canadian Labour Union (CLU): Formed in 1873, the CLU was the first attempt at a national federation by an organized labour group. Support was provided for striking members who were unsuccessful with arbitrationThe Knights of Labourarrived in Canada in 1881, with the goal of eliminating the depersonalization of workers that resulted from mass production technology.It strongly believed in the use of temporary work stoppages—called strikes—as an effective labour weaponStrikes: temporary work stoppages by employees, calculated to add force to their demandsObjectives of Unionization1.Higher compensation : on average union members earn more in salary, wages and benefits than non union workers2.Improved work rules and conditions : unions negotiate specific work rules such as the number of required work days, break and meal times, number of paid holiday and vacation days, overtime rules and workplace safety standards3.Increased job security : unions negotiate policies related to seniority rights, layoffprocedures and other job protections4.Defined grievance procedures : unions negotiate policies related to employee discipline, grievances and procedures for mediating or arbitrating disputes between labour and management5.Power through solidarity: the power of a union to negotiate effectively with management is derived from the collective unity of its members, which provide much more leverage than a single employee negotiating alone.of their loss of-

Labour contract: a written agreement between labour and management that is in force for a set period of timeGrievance procedures: a formally established course of action for resolving employee complaints against managementLabourManagementLegislation-Canadian Industrial Relations Board (CIRB): a federal agency that interprets and administers provisions of labour law to support constructive labour management relations.-Which agency of the government is responsible for promoting effective labour-management relations?Unionization process: unionization process consists filing a certification application with theprovince's Labour Relations Board, holding a representation vote (in favour of the union), and having a formal "certificate" issued by the Board that establishes the union. A show-of-hands vote is not part of the process-organizing campaign, thefirststepintheunionizationprocess, employee interest and support for the idea of forminga union.organizers try to developNegotiating the Labour Contract-Collective bargaining: the process of negotiating labour agreements that provide for compensation and working arrangements mutually acceptable to the union and tothe management. The steps include:1.prepare for negotiations2.meeting between labor and management3.reaching an agreement4.voting and ratification of the agreement-Ratification: approval of a labour contract by vote of the unionIntegrative bargaining(also known as interest-based bargaining) generally requires more negotiating skills because it emphasizes building long-term relationships and using problem-solving techniques and collaboration to develop mutually beneficial agreements.Labour’s Negotiating Tactics:-Picketing: marching back and forth in front of a place of employment with signs-Slowdowns: workers report to their jobs but work at a slower pace than normal-Boycotts: refusals to do business with a particular company-Publicity: publicizing union’s position/conducting informational picketing outside workplace-Strike: work stoppage-Court Injunctions: limit management’s option by requesting court order

Management’s Negotiating Tactics:-Lockout: business’s refusal to allow union employees to enter the workplace-Replacement workers: non-union workers hired by management to replace striking union workers.-Injunction:court order requiring a person or group either to perform some act or torefrain from performing some act-Publicity: publicizing organization’s positionMeditation: process of settling issues in which the parties present their case to a neutral mediatorArbitration: use of a neutral third party who conducts a formal hearing on an unresolvedTrendsinLabour-Managementrelations●Pressure on Public-Sector Unions: Unions will continue to play a large role for certain public-sector jobs such as teachers, firefighters, and other government employees. But economic conditions and falling public approval may impact their negotiating leverage.●Increased Partnership Between Employers and Private-Sector Unions:Private-sector unions in traditionally unionized industries will continue to work to protect and improve jobs, pay, and working conditions for their members. But a weak economy and increased global competition may prompt unions to more often seek partnership than confrontation.●Increased Responsiveness of Management: Management at an increasing number ofcompanies seeks to balanceprofitswithsocialresponsibility, particularly in regard to thewelfare of their employees. However, public pressure and the threat of unionization remain a relevant force for keeping management accountable for their actions.Chapter 12: Building Customer Relationships through Effective MarketingMarketing: the entire process of creating relationships with customers by offering goods and services and experiences that they valueProductionorientation:apastaeramarketingthatplacedemphasisonincreasedoutputandproductionefficiency.-Takeorders-Mass produce-Distribute goodsFrom the start of the Industrial Revolution until the early 20th century, business had a strong productionorientation, in which emphasis was placed on increased output and production efficiency.New sales orientation : was characterized by increased advertising, enlarged sales forces, and,occasionally,high-pressuresellingtechniques.-Increase advertising

-Focus on product benefits-Intensify sales techniquesCustomer orientation: the current era in marketing where an organization first determines what customers need and then develop products to fill those needs-Determine customer needs-Satisfy those needs-Use customer feedback to continually refine and improve product offeringsCustomer orientation adopts the Marketing Concept: a philosophy that a business should provide goods and services that satisfy customer needs through a coordinated set of activities that allow the business to achieve its objectivesToimplementthemarketingconcept:-a business first must obtain information about its present and potential customers.-It must identify not only what customers’ needs are but also how well these needs are being satisfied by products currently in the market—by both its own products and those of competitors.-It must assess how its products might be improved and what opinions customers have about the business and its marketing efforts.-The business then must use this information to pinpoint the specific needs and potential customers toward which it will direct its marketing activities and resources.-Next, the business must mobilize its marketing resources to1.provide a product that will satisfy its customers2.price the product at a level that is acceptable to buyers and that will yield an acceptable profit3.promote the product so that potential customers will be aware of its existence and its ability to satisfy their needs4.ensure that the product is distributed so that it is available to customers where and when needed.Finally, the business must again obtain marketing information—this time regarding the effectiveness of its efforts. The business must be ready to modify any or all of its marketing activities based on information about its customers and competitors.Customer relationship management (CRM): track and organize information about current and prospective customers to create marketing strategies that develop and sustain desirable customer relationshipsBranding: the relationshipbetween a companyand its customersthat is built on trust.-What the name meansin the consumers mindSatisfying-The-The-TheKinds of Utility-Form utility is created byefforts may influence form

-Thea customer requiresright productright place right price right timeProvidesvalues in 4ways-Right product: Customers have a choice of product options that satisfy their needs and wants.-Right place: Customers are able to acquire a product in a convenient manner.-Right price: Customers are able to pay a price that reflects the fair market value of that product.-Right time: Customers are able to acquire that product when they need it.Utility: the ability of a product to satisfy a human need. The 4 kinds are:-Form utility is created by converting production inputs into finished products.Marketing efforts may influence form utility indirectly because the data gathered as part of marketing research are frequently used to determine the size, shape, and features of a product.-Place utility is created by making a product available at alocation where customers wish to purchase it. A pair of shoes is given placeutility when it is shipped from a factory to a department store.-Time utility is created by making a product available when customers wish to purchase it. For example, Halloween costumes may be manufactured in April but not displayed until late September, when consumers start buying them. By storing the costumes until they are wanted, the manufacturer or retailer provides time utility.-Possession utility is created by transferring title (or ownership) of a product to a buyer. This may be as simple as a sales slip or receipt for a pair of shoes or as complex as a title transfer for automobiles and homes. Along with the title to its products, the seller transfers the right to use that product to satisfy a need.Marketing directly creates place, time and possession utility. As they add real value in terms of money and convenience.Marketing Mix: the combination ofdivided into four elements: product,marketing activities that deliver value toprice, placement and promotion. ( 4 P’scustomers, typicallyof marketing)-Product: an element of the marketing mix that includes decisions about a products design, features, brand name, packaging, warranties etc.-Pricing: setting a price based on the demand and cost for a good or service-Placement (aka Distribution): creating means by which products flow from

the producer to the consumer includes transportation, storage, and selection of intermediaries-Promotion: an element of marketing mix that focuses on providing information to target markets.Marketing strategy: a plan that will enable an organization to make the best use of its resources and advantages to meet its objectives. It consists of…1.the selection and analysis of a target market, a group of individuals or organizations for which a business develops a specific marketing mix suitable for the specific needs and preferences of that group, and2.the creation and maintenance of an appropriate marketing mix, or the combination of marketing activities—product, price, distribution, and promotion—that satisfy customer needs and preferences.4 P’s are important foundation of branding for two reasons-The marketing mix must be complete and integrated if it is going to satisfy target customers-The marketing mix for a given product must remain consistent in order for consumers to trust that they will receive the same benefits from that product in the future.The five steps in the consumer decision process are:*A critical flaw in the process of generating alternatives is to go with the first alternative that meets the minimum threshold for solving the problem. This is referred to as satisficingInfluences of decision process : Social, Psychological and SituationalPromotionincludesALLvalues

Brands can first establish a connection with consumers in a variety of ways:-We buy the product and have a good experience with it.-Someone in our social circle buys the product and has a good experience with it.-We read about the positive experience of others such as when we look at customer reviews.

- We are influenced by promotional messages from the business. ➔ Branding can fast track the decision making processMarket Segmentation: the process of separating, identifying and evaluating the layers of a market to identify a target marketBy selecting appropriate target groups, then studying those groups, companies can optimize their marketing mix by:-Developing products that better meet the needs of the target group-Charging prices that are reasonable for the target group-Selecting distribution channels where the target group shops-Building promotions strategies that will reach the target group efficiently that group’s needs and motivations3commondimensions of MarketSegmentation-Demographic:Age,Gender,ethnicity,incomeandsocialclass,education,familysize,religion-Geographic:Urban,suburban,rural,citysize,region/country,climate-Lifestyle(psychographics)andbehaviour:Values,attitudesandbeliefs,personalityattributes, media usage, product usage, brand loyalty, price sensitivityForces of the MarketingEnvironment-Economicforces—theeffectswillingness to buy-Sociocultural forces—influences in a society and its culture that result in changes in attitudes, beliefs, norms, customs, and lifestyles-Political forces—influences that arise through the actions of elected and appointed officials-Competitive forces—the actions of competitors, who are in the process ofimplementing their own marketing plans*-Legal and regulatory forces—laws that protect consumers and competition and government regulations that affect marketing-Technologicalforces—technologicalchangesthatcancreatenewmarketingopportunities or cause products to become obsolete almost overnightMarketing plans: a written document that specifies an organization's resources, objectives,and speak toof economic conditionsoncustomers’abilityand

marketing strategy and implementation and control efforts to be used in marketing aspecific product or product group

Marketing Research: is the process of systematically gathering and analyzing data concerning a particular marketing program.-The four steps in the market-research process are to define the research goal, gather information, interpret the information, and make market decisions based on the informationApplications for market research includes:-Assessing the business environment to identify opportunities-Understanding your position in relation to competitors-Learning the preferences and usage patterns of your existing customers-Evaluating the likely success of a new product-A cookware manufacturer hires a marketing research firm to investigate trends in cookware buying. Which of the following can the firm NOT do ? (reduce prices on the company's most popular product line)Secondary research: market research information that has already been gathered and published by someone outside the companyPrimary Research: market research information that is collected by the company using methods such as surveys, focus groups, and customer interviewsDemographics: a dimension of market segmentation that includes measurable characteristics such as age, gender, income, education level, and so onBrandValueisbuilt on 2ideas-Consumers hope-Companies hopeto find products to sellproductsthat satisfy their needsthat satisfy customer needsChapter 13: Developing and Managing ProductsProducts: everything one receives in an exchange, including all tangible and intangible attributes and expected benefits; it may be a good, a service, or an ideaConsumer product is to purchased to satisfy personal/ family needs 4 types:1.Convenience : a relatively inexpensive, frequently purchased item for which buyers want to exert only minimal effort.-For example: soft drinks, candy bars, milk, bread, tissues, and toiletries such as toothpaste. We buy them routinely without much planning. This does not mean that such products are unimportant or obscure. In fact, many are recognizable by their brand names, such as Tim Hortons, Boston Pizza, and Canada Post.2.Shopping : is an item for which buyers are willing to expend considerable effort on planning and making the purchase.

-Buyers allow ample time for comparing stores and brands with respect to prices, product features, qualities, services, and perhaps warranties. Video game systems, mattresses, personal grooming products, and cell phones are examples of shopping products.-These products are expected to last for a fairly long time and thus are purchased less frequently than convenience items.3.Specialty: possesses one or more unique characteristics for which a group of buyers is willing to expend considerable purchasing effort. Buyers actually plan the purchase of a specialty product; they know exactly what they want and will not accept a substitute.

Accessory equipment: activities-While searching for specialty products, purchasers do not compareExamples include sports and movie memorabilia, accessories such purses or shoes, or vintage wines, engagement rings4.Unsought: a product that is not actively sought out until a significant event consciously thought about)alternatives.as high-endoccurs(not-For example; This may change when a person has becomes an important aspect of personal financiala child and life insurance planning, ie: life insuranceGood: a physical, tangible product that we can see and touch—Examples: smartphones, vehicles, paper and pensService: an intangible product that we experience or use—Examples: financial advising, office cleaning, warranties-Needs more customizationProduct: are often a blend of goods and services. For example, a Honda Civic (a good) would have less value without Honda’s maintenance agreement (a service)Business Products: purchased for resale, for making other products, or for use in a businesses operationsClassification of ProductsRaw Material: a basic material that actually becomes part of a physical product; it usually comes from mines, forests, oceans, or recycled solid wastesMajor equipment: large tools and machines used for production purposesstandardized equipment used in a business’s production or office-Examples include hand tools, fax machines, fractional horsepower calculators. Compared with major equipment, accessory items are expensive and are purchased routinely with less negotiation.motors, and usually much less

Component Part: an item that becomes part of a physical product and is either a finished item ready for assembly or a product that needs little processing before assembly

-Clocks, tires, computer chips, and switches are examples of component parts.Process part: a material that is used identifiable in the finished product-examplesincludeindustrialglue and food preservatives.Supply: an item that facilitates production and operations but does not become part of a finished productBusiness service: is an intangible product that an organization uses in its operations. Examples include financial, legal, online, janitorial, and marketing research services.Innovation: any product improvement that customers value over existing choices,includes entirely new products that did not previously exist and adaptations tonew Benefits:InnovationBenefits→maintainingrelevance-Improving function or quality-Lowering cost of production-OfferingnewexperiencesCompanies innovate because products can become obsolete or unprofitable as:-More competitors offer products similar to yours-Competitors introduce innovations of their own-Customers need changeTechnology changesPhases of Product Development1.Idea generation: the first phase of the product development process, when marketers generate as many ideas as possible.Product analysis: the second phase of the product development process, when marketers screen ideas to select the best one-In which phase of the product development process does a company evaluate the feasibility of a product, its profitability, and its fit within the company's existing productproduct mix, are too expensive, or aren't feasible for some other reason. It presents ideas to potential customers for feedback and creates estimates of possible costs and the profitability of launching the new product.Product development and testing: the third phase of the product development process, when marketers build prototypes or small production runs of the product to test on a small scale- Adirectly in the production of another product but not readilywhich productsmix?-Under which stage are ideas that do not fit the product mix excluded?-During the product analysis phase, companies weed out ideas that don't fit the3.2.solar battery manufacturer wanted to determine if there was sufficient market-

interest in adapting its products for campers, so it produced some prototypes and gave them to campers to test. What product development phase does this illustrate?4.Commercialization: the final phase of the product development process, when marketers take all they have learned from previous phases and make final improvements to the product before launching it to the marketProduct Life Cycle : the series of stages through which a product progresses in the market calleddistributionIntroduction stage: the first stage of the product life cycle, when there are few competitors. Sales and profits are typically low in this stage, may charge higher prices for products.Growth Stage: the second stage of the product life cycle, when sales and profits increase, and competitors take notice and decide to enter the product categoryMaturity Stage: the third stage of the product life cycle, when sales peak and profits decline as the market becomes saturated and price competition increases-What is it called when a company exceeds its sales projections?-Maturity-What are characteristics of the maturity state of a product-A peak in the sales curve, simplification of product lines, increased price competition-Which of the following actions can a marketing manager take to maintain a steady share in the market once a product has reached its peak?--> reduce marketing costsDecline Stage: the fourth stage of the product life cycle, when sales and profits decline as

consumerneedsmoveawayfromtheproductcategory.Abilitytoproduceatlowcostusuallydetermines which competitors remain in marketMarketing strategies for Product Life cycle

Product Lines:or the audienceProduct Mix: collectionof all thecompany’s products-Marketing managers at the company must actively manage the product mix by modifying, adding, or removing products as needed to maximize sales revenue and profits.-Procter & Gamble sells laundry detergents such as Tide and Gain, hair care products such as Pantene and Natural Instincts, cosmetics such as Clairol and Olay, and a variety of other diverse products. What do these products comprise?Decisions about product mix changes maybebasedon:-Changes in customer preferences—Example: Customers may prefer new flavours, colours, or styles.-Challenges from competitors—Example: Competitors may offer better features or technologies in their products.-Stageofproductlifecycle—Example:Companymaydecidetodiscontinueaproductthat is in the “decline” stage of the product life cycle.-Simplify product mix—Example: Company may decide to produce fewer colours or styles of a product in order to streamline manufacturing processes and offer customers clearer choices between products.a group ofthey targetsimilar products that are related to each other in the way they work-For example, Gatorade has a variety of lines in the sports drink category, including G Series, G Series Pro, and G Natural. Product lines in the same category can also be marketed using separate brand names, as General Mills does with their cereal products.-What are Coke Zero, Coca-Cola, Cherry Coke, and Diet Coke? (one of cokes product lines)-A large consumer products company introduces a group of products aimed at hair care, such as shampoo, conditioner, hair colour and styling gel. What is this group of products

known as?

3 Benefitsof ProductLines1.Clarity for Consumers2.Simplify Branding3.MoreeffectivemanagementFunctions of Packaging-The package is a vital part of the product. It can make the product more versatile, safer, or easier to use. Through its shape, appearance, and printed message, a package can influence purchase decisions.-Primary functions of product include-Protect the product-Choice of Materials-Construction of Packaging-Attract buyer attention-Colors-Pictures-Large Brand or Product Names-Provide product information-Key Features or Ingredients-Explanation of Contents-Instructions for Use-Improve design or function-Innovative Shapes-Improved Pour Spouts-Resealable Cartons-Home cooks are fans of resealable cartons of broth because, unlike canned stock, they can reseal leftover broth and store it in the refrigerator. Which function of packaging does this best illustrate?-Better serve customer needs-Travel-SizeVersionofProduct-Product BundlesMcDonalds will start serving premium coffee to compete with Starbucks. It is used when costs and revenues are considered secondary to competitors' prices.Chapter14–ManagingDistributionandPricing14.1 Channels of Distribution. Distribution is part of marketing strategy, not operations. Marketingintermediaries–organizationsthathelpmoveproductsfromproducersto customers.-intermediariescanoftenperformdistributionfunctionscheaper,faster,andbetterthan producers can. Producers who carefully select intermediaries to perform certain tasks often make more profit, not less-Some companies limit intermediaries to a few. What do these companies think that fewer intermediaries will achieve? Lower the price

2 types:

1.Retailers–businessesspecializinginsellingproductstotheenduser-buys goods from producers and/or other marketing intermediaries and sells them to consumers-What role does a supermarket play between a producer and consumer?-Retailers are the final link between producers and consumers.2.Wholesalers–companiesthatsellproductstootherbusinesses,suchasretailstores, instead of selling to customers.-Wholesalers provide efficiency and assortment of goods, break bulk, provide valuable marketing information, and offer an instant sales infrastructure.Four common distribution channels:1.Directchannel–adistributionchannelwheretheproducersellsdirectlytothecustomer,withnomarketingintermediariesinbetween(sometimesreferredtoascustomer-direct)-Owner of a small orchard has a roadside stand where customers can buy bushels ofapples.-shortest-Ie: burberry and roots sell directly to customers2.Producertoretailertocustomerchannel–adistributionchannelwheretheproducersellsto a retail store, which then sells to customers-Retailers→largestmarketingintermediary.Ie:Burberrysellstowinnerssellstocustomers3.Producetowholesalertoretailertocustomerchannel–goodsarefirstsoldtowholesalers, and then to retailers (sometimes referred to as two-step)- producer of engineered wood products sells its products to wholesalers, who turn sell the product to retailers like Home Depot and Rona, who in turn sell to consumers-Wholesalers sell products to businesses instead of customers. Coke sells to whole sales who then sells to Circle K and Loblaws4.Producertoagenttowholesalertoretailertocustomerchannel–similartotheproducerto wholesaler to retailer channel, but with the addition of sales agents who help connect buyers and sellers.-agents bring buyers and sellers together, help get foot in the door, and earn commission.-Factory in china would want to have an agent call wholesalers and retailers to carry their product-longest

When producers sell directly to customers, they keep all of the profit and get to maintain a direct relationship with the customer. They can also control all aspects of the customer shopping experience, which is why big brands such as Nike and Apple maintain their own retail stores even while they use other distribution channels.Benefits of Marketing Intermediaries-Efficiency and assortment of goods-Break bulk producers by buying large shipments, and then break them down into smaller quantities-Instant sales infrastructure-Valuable marketing information such as data on customer demand for various products, new developments within the industry, and insights into the activities and prices of competitorsWholesalersprovideavarietyoffunctions,andthesefunctionscannotbeeliminatedbecausetheymustbeperformed.3 categories of wholesalers:1.Merchantwholesalers–purchasesgoodsinlargequantitiesandthensellsthemtoother wholesalers or retailers and to institutional, farm, government, professional, or industrial users;2.Commission merchants (intermediary’s that carry merchandise and negotiate sales for manufacturers),-agents (independent sales professionals who bring buyers and sellers together), and-brokers (intermediary that specializes in a particular commodity, represents either a buyer or seller, and is likely to be hired on a temporary basis);3.Manufacturers’salesbranchesandsalesofficers.All of these account for 4/5ths of all wholesale establishments

The importance of retailers. Four common features differentiate various physical retailers1.Number of product categories; some retailers sell products in one or two categories, while others sell a wide assortment. Ie: difference between roots and the bay2.Pricing (discount price vs sell at a premium). Will often relate to the level of customer service3.Distribution intensity the level of market coverage for a product, usually measured by the number of outlets where it is soldintensivedistribution–allavailableoutletsareused;selectivedistribution–onlyafewoutletsareused,productsareonlyavailableataverylimited number of outlets or stores in a region.- Bed mattress stores are an example of which type of distribution? exclusive distribution – very few outlets));-Very expensive goods, like Rolex watches and Jaguar automobiles are typically sold using which distribution?4. Size and selection. Different types of retail store formats (there are a shit-ton, see page 225and226).Tochooserightretailer,producersshouldlookat:whattypesofstorestarget customers shop at, whether we are looking for intensive, selective, or exclusive distribution, whether you prefer a high volume at a lower profit margin or a low volume at a higher profit margin, and if the retail environment is fit for our brand. Online retailing still requires the product to travel through one of the four existing types of distribution channels.Different retail formats-Department stores: employ 25 or more staff and sell a variety of things ie The Bay-Discount stores: self service general merchandise that sell products at low prices-Warehouse showrooms: retail facilities with 5 main characteristics 1) Large, Low costbuilding, 2) warehouse materials handling tech, 3) vertical merchandise display, 4)large on premise inventory 5) minimal service. IE. IKEA-Convenience stores: small food stores that sell food and household products ie 7-11-Supermarkets: large self service stores that sell food and household products ie: superstore-Superstores: large retail that carry food and non food products ie Walmart-Warehouse clubs: large scale members only establishment that combine features of cash and carry wholesaling with discount retailing ie Costco-Traditional speciality stores: narrow mix with deep product lines is Globo shoes

-Off price retailers: stores that buy manufacturers seconds, overruns, returns and offseason merch at below wholesale price and sell to customers at discount ie Winners-Category Killers: large specialty stores that concentrate on a single product line and compete by offering low prices and lots of products ie Pet smartOnline retail is 7% of all retail salesNon-storeretailing–sellingthatdoesn’ttakeplaceataconventionalstorefacility;customerspurchase products without ever visiting a store.Non-store retailers use 3 channels:directselling–marketproductstocustomersviaface-to-facesalespresentationsathomeorat work;directmarketing–theuseoftelephones,theinternet,andnon-personalmediato communicate product and organizational info to customers, who can then purchase products via mail, telephone, or internet (huge laundry list on page 227); andautomaticvending–theuseofmachinestodispenseproducts.Managingphysicaldistribution.Inventory – the supply of goods a company holds for use in production or for sale to customers.3 functions of physical distribution are:1. Inventory management (deciding how much of each type of inventory to keep on hand, and the ordering, receiving, storing, and tracking of it);-Which of the following has the goal to decrease storage costs and stockouts while maximizing profits and cash flow?-2. Warehousing (the function of physical distribution of that involves receiving and storing goods, then preparing them for shipment)3. Transportation (the function of physical distribution that ships products through the distribution channel to the customer). Thereare5majortypesoftransportation(railroads, trucks, pipelines, waterways and airplanes; see pg 230 for more info). See pg 229 for more info on the 3 functions of physical distribution.Channelofdistribution–themixofmarketingintermediariesaproducerusestomoveproductstocustomers.Modeofdistribution–theactualtypeoftransportationformovingphysicalgoodsfromonepointtoanother.

Pricing considerations. Many factors affect price, such as1.Economicconditions–healthyeconomy=pricingflexibility;strugglingeconomy=morepriceconsciousconsumers2.Theindustry–companythatdominatesanindustryorhasauniqueproductmaycharge higher prices, but competitive industries lead to a drop in prices3.Stageofaproduct’slifecycle–productatthebeginningofitslifecanbepricedhigher,but astheproductcategorybecomesmorecompetitiveandsaturatedthepricefalls.-The three key considerations when determining prices are your cost, what customers are willing to pay, and what competitors charge. The price associated with any of these three considerations can increase or decrease based on a variety of factors.3keyconsiderationsforpricing:-your cost (increase because manufacturing cost increases, and decreases because ofthe opposite),-the maximum price customers are willing to pay (increase due to new design, new feature, or new materials used, and decreases due to a recession)-what competitors are doing (price increase due to higher industry wide costs and/or enhanced perception of the product in the market place, and price decreases because competitors cut prices in order to increase sales volume). See page 231 for reasons why these three things change.break even point – the number of units that must be sold for total revenue to equal total cost. Fixedcosts–operatingcostsofacompany,likerent,salaries,andmarketingexpenses. Variablecosts–costsofproducingorpurchasingaproduct,whichincreasesasthevolumeofproductionincreases.Totalcosts=fixed+variablecosts.Contributionmargin–theprofitmarginonaunitofsalecalculatedassalesrevenue–variable costs(perunit).Number of units required to breakeven (breakeven volume) = fixed costs/contribution margin.Pricing objectives.There are 5 common pricing objectives used by marketers:1.Build a loyal user base2.Increase market share of business, which is the share of total industry sales

3.Communicate brand value4.Maintain the status quo (if you want) ie: industries where there is little product differentiation, competitors often choose to maintain an uneasy truce by matching each other'sprices. 5.Survival or liquidation.Pricing strategies: four categories1.newproductpricing–priceskimmingandpenetrationpricing-Price skimming: is the strategy of charging the highest possible price for a product during the introduction stage of its life cycle-Penetration pricing: is the strategy of selling new products at low prices in the hope of achieving a large sales volume and market share. Hopefully, before the competition can react.-An advertising campaign for a laundry detergent touts how clothes laundered using its detergent retain their original colour after many washes, while the competitor's detergent causes the colours to fade. What is the promotional objective of this advertising campaign?-increasing market share2.Psychologicalpricing–odd-numberpricing,multipleunitpricing,referencepricing,bundle pricing, everyday low prices, and customary pricing-strategies encourageeconomically rationalpurchases basedresponses.on emotional responses rather than on-Odd number: setting prices using odd numbers that are slightly below whole-dollar amounts. Nine and five are the most popular ending figures forodd-number prices. The strategy is not limited to low-priced items.-Multiple unit pricing: setting a single price for two or more units, such as two cans for 99 cents rather than 50 cents per can.-Reference: means pricing a product at a moderate level and positioning it next to a more expensive model or brand in the hope that the customer will use the higher price as a reference price-Bundle: packaging together of two or more products, usually of a complementarynature, to be sold for a single price. To be attractive to customers, the single price usually is considerably less than the sum of the prices of the individual products. Bundle pricing is used commonly for banking and travel services, computers, and automobiles with option packages.3.Productlinepricing–captivepricing,premiumpricing,andpricelining4.Promotionalpricing–priceleaders,specialeventpricing,andcomparisondiscounting.

Chapter15–DevelopingIntegratedMarketingCommunications15.1ThepromotionMix–theuniquecombinationofadvertising,personalselling,salespromotion, and public relations used to promote a product.-Advertising-personal selling-Sales promotions-public relations (PR)are four tools that are strategically blended together to raise awareness, build product demand, or achieve some other promotional objective for the company.-In developing its promotional mix, what is the most important factor for any company?-its promotional objectiveCompanies must consider the following, for promotional campaigns: the cost of certain promotion tactics, how much its competition is using certain tactics, and what other tactics may be effective.External factors affecting the promotion mix:-government (political environment)-the competition (economic environment)-advertising design (trends in social environment)-the technological environment is always changing.Integratedmarketingcommunications–coordinatingallaspectsofthepromotionmixtosendclear and consistent messages to customers. Promotional mix must be coordinated in all aspects, to send a clear message to customers.-A person notices a poster advertising TELUS, sees a television ad for TELUS, and then later in the week sees a website banner ad for TELUS. What is this an example of?-In the weeks preceding an important election in your province, you see yard signs and billboards for a candidate, hear repeated radio commercials touting his credentials, and it seems that he's being interviewed on local TV or radio shows on an almost daily basis. What does this best describe?15.3Advertising–anypaidformofnon-personalpresentationbyanidentifiedsponsor(largestshareofpromotionalspending).-The explosion in advertising choices has led to increased accessibility for smaller advertisers to advertise. Sevenmajormediumsofadvertising:television, direct mail,MOREON14-11atextbook

newspapers, radio, magazines, online, and outdoor (see page 245 for a pros and cons list of each).-TV *** most effective in reaching consumers massive scale**-Disadvantages: expensive, quickly forgotten, increasingly ignored- Advantages: largest reach, audio and visual impact is high, frequent- Direct Mail-Disadvantage: expensive per piece, thrown away often.- Advantage: selective/personal, easy to measure performance, hidden from comp- Newspaper-Disadvantage: short life, high volume of ads limit exposure, hard to target- Advantage: large, local audience, short lead tim\es, frequent ads.- Radio-Disadvantage: lacks visual, attention limited, difficult for driving to call to action- Advantage: local audience, low cost, short lead times- Magazine-Disadvantage: high cost, long lead times, infrequent- Advantage: selective target, long life, strong visuals- Online-Disadvantage: cost per click can be high, Concerns about security and privacy, uncertainty about how to evaluate return on investment- Advantage: highly selective, available for most budgets, real time feedback- Outdoor-Disadvantage: very short message, seldom attention, blight on landscape-Advantage: geographic selectivity, placed close to point of sale, frequentSometimes marketers must make trade-offs. For example, an ad for a restaurant often worksbest in a high-quality visual format such as those offered by television or colour magazine ads. The image of food seen on TV is far more likely to capture a customer’s attention than a description of food heard on the radioOnline advertising is gaining popularity, because it is highly targeted and measurable, can be done with a small budget (companies of any size can invest), and because buyers are spending more time online. Television is still the medium of choice for producers wanting to reach the largestaudience.-online advertising will surpass television advertising to become the largest category of ad spending15.5Personalselling–aface-to-facepresentationtoaprospectivecustomer.-Most adaptable because the person presenting can adapt it on an individual buyer basis. This is the most expensivemethodgenerally used to sell high-dollar goods and services, such as real estate, expensive equipment, and large service contracts.-Which element of the promotional mix allows you to customize your message to suit the buyer?-Prospecting–apartofthepersonalsellingprocesswhereyouresearchpotential

buyers and choose the most likely customers or prospects.The industry, nature of the product, and characteristics of the market all influence the personal selling process. 6stepstothepersonalsellingprocess:

1.Prospecting (research potential buyers)2.Approach the prospect (phone call, email, etc.)3.Make the presentation (usually includes product demonstration) For real estate this would be showing houses.4.Answer objections (try and highlight key benefits of product)5.Close the sale (usually, offer to help with setup and ask how quickly they want it)6.Follow up (ensure everything was set up and is currently fine).Salespromotion–marketingeventsorsalesefforts(notincludingadvertising,personalselling,and public relations) that stimulate buying. direct incentives for customers to purchase or try a product. Sales promotion is usually offered by the producer or the reseller of the product.Examples of sales promotion:coupon (discount on purchase price of product);-When Safeway accepts coupons issued by other grocery stores for its merchandise, what is it trying to do?-attract new customerssamples (free product, usually in a trial size); premiums (free gifts with the purchase of a product); NationalAdvertising:-Miele would like to promote its new line of dishwashers with the multi-flow system on a national basis. Which promotional tool would be most appropriate for it to accomplish this promotional objectivefrequent-user incentives (rewards for customer loyalty);point-of-purchase displays (promotional material placed in retail stores to draw attention to products);-What is one of the most effective ways to grab customers' attention in a crowded retail environment?-sweepstakes and contests (opportunities for customers to win cash or prizes by entering).

Promotion objectives:1. to attract new customers (use all methods)2. to encourage trial of a product (use samples)3. Increase customer loyalty (use frequent-user incentives)4. Cross-sell other products from your company (use all methods)5. Togainattentioninaretailenvironment(point-of-purchasedisplays)6. Toidentifyprospectsorbuildcustomerrelationships(sweepstakesandcontests).15.9Publicrelations(PR)–anycommunicationoractivityinitiatedbyacompanythatisdesigned to win goodwill or prestige for a company or person. A disadvantage is that the company cannot control the amount or content of the media exposure.Most common goal of PR is media coverage of the company (very valuable because the company doesn’t pay for it, like they would for ads).PR’s3tools- Pressrelease–apublicitytoolthat’sgenerallyonepageofabout300-500wordsthatthe organization provides to the media to promote its company or its product. Press releases are the most widely used PR tool.-Press releases include: new products, interviews with company officials, reports ofnew discoveries, expansion into new markets, and investment results.-Pressconference–apublicitytoolwheremediamembersareinvitedbyacompanyto hearnewsorproductannouncements.Applehasthemostpopularpressconferences.-Sponsorships–promoteapositiveimageforthecompany,throughtheinvolvementof attendees and the media coverage generated by the event.PR tool(s) advantages and disadvantages:-pros:-PR is extremely leveraged (gain much more out than what you put in)-huge social media = bypass the media (announce stuff at basically no cost).- Cons:-publicity is usually out of the company’s control (thousands of PR tools are used each day, most of which are ignored)-companies aren’t able to control the message the media communicatesPromotional planningPromotionalcampaign–aplanforcombiningthefourcomponentsofthepromotionmixtoachieve one or more marketing goal.-Four factors that will influence the makeup of a promotional campaign are the company's promotional objective, nature of the target market, characteristics of the product, and the organization's resources.

Selection of a campaign depends on:1. Which of the following is most important: building awareness and demand for the product, increasing or retaining market share, enhancing or repairing your company brand, and identifying and retaining existing customers.2.Nature of your target market (size, geographic distribution, and lifestyle characteristics).3.Characteristics of the product (complex, high value, or low priced).4.Theorganization’sresources.Chapter16:ExploringBusinessTechnologyTechnologyhelpsbusinessesTechcanprovidebusinessesneeds.operate more efficiently and therefore increase its bottom line. quicker and more accurate access to information regarding buyers-Alsohelps with Decision making( planning operations)Managers are constantly seekingout leapfrog the competition, andreduce may come from sourcessuch as:insights that can help them better serve customers, the risk associated with major investments. These insights-Internal company records-Market research projects-Published news and research-Analysis of competitorsManagement Information system (MIS): a technology system that provides managers and employees with the information they need to perform their jobs as effectively as possible-Typically an integrated computer database that provides two key benefits-Huge amounts of data can be processed quickly which expands and accelerates the ability to uncover key insights that can improve decision making-Timely and useful information can be distributed to managers and employees

automatically making processing and presentation of information highly efficient

MIS has 3 primary functions1.Collect : data collected and stored from internal and external sources-Internal data such as sales and marketing data, financial data, inventory and production data, human resources records, and other data related to company operation-External data such as market research reports, information from suppliers, customer information, and other data collected from outside thecompany.2.Process: Transformation of data into a useful form. Some data are used in the form in which they are stored, whereas other data require processing to extract, highlight, or summarize information.-Examples of data processing can include:-Sorting-Combining-Filtering-Calculating-Validating3.Present : present information in a useful form such as a report, table, graph or chartTypes of MIS Systems-Financial MIS : Financial managers and accountants study the company’s debts and receivables, cash flow, future financial needs, and other accounting information. They also study the present state of the economy, interest rates, and predictions of business conditions in the future-Marketing MIS: Marketing managers need to have detailed information about the company’s products, customers, current and projected market share, and the activities of competitors.-Operations MIS: Operations managers are concerned with present and future sales levels, current inventory levels, and the availability and cost of the resources required to make their products.

-Human Resources MIS: Human resources managers must be aware of anything that pertains to the company’s employees. Key examples include current wage levels,benefits packages, training needs, and the company’s growth plans.Cloud Computing: a type of computer usage in which services stored on the internet are provided to users on a temporary basis. For businesses cloud computing can:-Make collaboration easier because files can be accessed from anywhere on a variety ofdevices-Provide access to a wider range of tools for storing and processing data-Reduce IT costs for the organization-However increases risk of unauthorized user accessAccording to Statistics Canada, almost 85% of the adult population in Canada use the Internet Green IT: a term used to describe all of a businesses activities to support a healthy environment and sustain the planet6 Common Business Models (using technology and connectivity)1.Online- Only Retailing: an online business model where the company was conceived from the outset to sell online2.Click and Mortar retailing: an online business model where traditional brick and mortar retailers sell online as well3.Business to Business (B2B) procurement: an online business model where companies move their supply chain ordering processes online-An example of business-to-business (B2B) procurement is when GE or Caterpillar (or in this case, the university) submits and tracks supplier orders electronically.WhileB2Bprocurementdoesn'tnecessarilycreatenewrevenue,itcan decrease costs and ensure greater accuracy than older, paper-based methods of ordering4.Advertising-based Model: an online business model where content or functionality is offered to users for free and the company sells advertising to generate revenue5.Fee-based content: an online business model where sites charge a fee for access to news, research, entertainment, or other types of content6.Fee-based platform: an online business model where companies offer users functionality or connectivity in exchange for a feeKey Performance indicators (KPI’s) : measurements progress toward achieving various objects.-measurements that a company its online business modeluses toevaluate factors that are crucial to the success ofOnline ad spending has now surpassed both print ad spending and TV spending. TV captures approximately $3 billion in domestic revenue, and digital advertising brought in over $5 billionthat a company uses to track its

6 Major Online Marketing Tactics ( can be used alone or coordinated in a campaign)1.Search Engine Optimization (SEO): improve search engine ranking by optimizingwebsite structure, use of keywords, number of links from other sites and a variety ofother techniques2.Pay per click (PPC): a method of online advertising where advertisers only pay when a consumer clicks on an ad3.Content Marketing: online marketing tactic that uses blogs, videos, infographics and other content to attract and engage customers4.Social Media Marketing: an online marketing tactic that involves interacting with customersonsocialnetworkssuchasFacebook,Twitter,PinterestandGoogle+5.Lead Generation: online marketing tactic that often involves creating a webpage whose sole purpose is to incentivize customers to provide their email address or other contact information6.Email Marketing: used to complement traditional offline marketing activities, especially for businesses that sell a physical product or have a brick and mortar store.Multichannel marketing: the combination of traditional offline marketing tactics with online marketing tacticsWeb analytics: the collection and activities. Can measure-Number of visitors to each site-Most visited pages on each site-Time spent on each site-Path users took through the site-The number of customers who put an abandoned their cart before checkoutInteracting with stakeholders using online toolsCompanies often use online tools to pursue the following three goals:-Improve customer service-Manage company reputation-Gather product and marketingMobile users interact with their devices differently than do desktop users, meaning that companies adapting to the increase of mobile users must:Footnote1.Optimize website design and functionality for mobile devices.2.Ensure compatibility with mobile devices.3.Simplify payment options for mobile users.How can companiesoptimizewebsitedesign for mobiledevices?-Maintain consistent branding with the full version of the siteanalysis of data related to a website or other online marketingitem in their online shopping cart but hasinsightmost likely to use

-Create a streamlined layout with simple navigation-Prioritize content according to the features mobile users are

merchantsquick,PaymentThere areOptions Simplificationa variety of ways that online-Saved customer accounts: By allowing customers to save their payment information from previous Web store purchases, customers can quickly check out by signing in to their Web store account.-Online payment services: By accepting third-party payments from services such as GoogleWallet,PayPal,andVerifiedbyVisa,evenfirst-timecustomerstoaWebstore can check out easily by logging in to their existing accounts to complete the transaction.➔traditionalbrick-and-mortarretailerscanleveragethegrowthofmobilecommerce by embracing the ability for customers to pay with smartphones instead of using theircreditcards.Today,anincreasingnumberoftransactionsareconducted frommobiledevicesusingmobilepaymentappssuchasPayPal,Square,and GoogleWallet.Infact,mobilepaymentsareseeingover100%growthyearover year.Mobile appsCompanies that have developed a mobile app often advertise that app on the mobile version of their website. By encouraging customers to download the app, companies ensure a streamlined and efficient user experience and also gain dedicated space on the customer’s phone.16% of all transactions at Starbucks are conducted using Starbucks mobile payment appTime spent online on mobile devices now equals that of desktop devices; a little more than half of Facebook's daily users are mobile-only; and mobile devices make more than half of all local search traffic.According to research, approximately what percentage of adult Canadians use the Internet? 80According to Statistics Canada, almost 85% of the adult population in Canada use the Internet.Chapter 16: Integrating Sustainability into Operations-sustainable business:a business that conducts its operations without negatively impactingthe environment, community, or society as a wholecan enable aeasy checkout:

-Three Pillars ofSustainability•Social sustainability: managing operations in a way that positively contributes to the socialwell-being of the business’s employees, customers, the community in which it operates, andsociety as a whole.•Environmental sustainability:managing operations in a way that minimizes negative impacts on the natural environment. such as lowering emissions or energy consumption.•Economic sustainability: managing operations in a way that promotes long-term growth and profitability of the company through responsible and efficient use of resources while minimizing negative impacts on the environment and society-Circular economy:an economic system aimed at eliminating waste and pollution, keeping products and materials in use for longer, and regenerating natural systems--Linear economy:a traditional economy that follows the ‘take, make, waste’ model of production, where raw materials are extracted and transformed into products which are used until they are eventually discarded as wasteHow Can Businesses Benefit from the Circular Economy Model?

-Reduced Costs: Fewer materials, lower input costs, reduced spending on energy and waste management.-Improved Resilience:By reducing the use of raw materials and instead using more recycled, reusable, or easily transformed inputs, companies become less sensitive to volatility in raw materials pricing. This also protects companies from geopolitical crises and safeguards them against unexpected material supply shortages.-Strengthened Customer Relationships: Under a circular economy model, products are often rented or leased by customers during different periods of time if the type of product allows for it. This provides businesses with an opportunity to increase interaction with their customers and better understand consumer behaviour.-Positive Brand:A business can set itself apart from competitors and establish a positive brand by incorporating principles of a circular economy into its operations, thus demonstrating a commitment to sustainability.-cradle-to-grave:a design and production approach that considers impacts from production of the product, up until the product’s disposal only. This design philosophy was first introduced by Michael Braungart, a chemist, and William McDonough, an architect, who combined design and science to develop a framework characterized by three principles:-(1) everything is a resource for something else,-(2) the “waste” of one system becomes food for another-(3) everything can be designed to be disassembled and absorbed back into nature or reused as high-quality materials for development of new products.-The goal of cradle-to-cradleis to mimic the regenerative cycle of nature, where waste is reused.-biological cycle:a cycle in which all materials, or “nutrients,” can be absorbed back into nature, such as food and natural fibres-technical cycle:a cycle in which all non-toxic and human-made materials (e.g., metals, oil-based plastics, chemicals) can be reused, repaired, or transformed without losing their quality

--upcycling, which is the transformation of waste into materials or products of higher quality.•Material Health:Inputs must be safe (i.e., few to no negative impacts on the environment).•Material Reutilization:Inputs should be readily recoverable and recyclable.•Renewable Energy:Energy used in production and operations should come from renewable sources.•Water Stewardship: Water must be regarded as a precious resource.•Social Responsibility: Businesses should respect diversity and follow fair labour practices.-Biomimicry:learning from and then emulating nature’s forms, processes, and ecosystems to create more sustainable designs and solve business challengesUnderstanding Life Cycle Impacts-life cycle assessment(LCA, sometimes referred to as life cycle analysis): a tool used toassess the potential environmental impacts of a product, process, or service over theproduct’s entire life cycle-4 Stages of LCA

•(1) goal definition and scoping,•(2) inventory analysis,•(3) impact assessment, and•(4) interpretation.-Supply chain sustainability:consideration for the environmental, social, and economic impacts of a product’s journey through the supply chain, from raw materials sourcing to production, storage, delivery, and every transportation link in betweenIntegrating sustainability into the supply chain emphasizes four key areasof focus:1.Procurement: A starting point for most businesses is to determine ways to procure energy, water, and materials more sustainably. Social procurement should be another focus for businesses looking to build sustainable supply chains, as social procurement positively contributes to both the local economy and the overall health of the community.2.Operations:Next, a business could turn its attention to operational processes or segments along the supply chain that are inefficient and look for opportunities to reduce resource consumption.3.Waste Management:As discussed in the sections on circular economy and cradle-to-cradle, businesses can determine ways to avoid excess waste by designing products forupcycling and reuse (i.e., cradle-to-cradle).4.Data and Communication:To manage a sustainable supply chain effectively, key performance indicators (KPIs) must be developed within each of the three areas and these indicators should be measured, reported on, and communicated to customers, supply chain partners, and other stakeholders.-Benefits of Supply Chain Sustainability:+ efficiency gains and cost reductions+ positive branding (e.g., research has shown consumers are willing to pay more for products and services that provide supply chain transparency)+ improved investor relations.-Challenge of Supply Chain Sustainability:+ Lack of Visibility into the Supply Network:Suppliers can be classified into Tier 1, 2, or 3. A business typically has direct relationships with Tier 1 suppliers, but the suppliers and subcontractors for the Tier 1 supplier (termed Tier 2 suppliers) are further removed. Tier 2 suppliers may work with providers of raw materials that would be considered Tier 3. Lack of transparency into the operations of suppliers in Tiers 2 and 3 creates a challenge, leaving a business to rely on Tier 1 suppliers to hopefully influence and educate Tier 2 and 3 supplierson sustainable practices and policies.+ Cost: Especially for smaller businesses, the upfront costs associated with building sustainability into the supply chain can be a barrier. However, efficiency improvements can often lead to cost savings in the long run.

+ Lack of Options:There simply may not be sustainable alternatives available at each segment of the supply chain based on engrained processes and options offered by existing suppliers.-Product stewardship:the act of minimizing the human health, safety, environmental, and social impacts of a product and its packaging throughout all stages of the product life cycle; a responsibility shared by all actors in the supply chain--extended producer responsibility (EPR): an environmental policy approach that places physical and/or financial responsibility for the life cycle of the product, including the post-consumer stage, on the producer-Green marketingrefers to the practice of developing and advertising goods and services based on their environmental sustainability.WestJet and Air Canada compete in which degree of competition? OligopolyIn which of the following would you find a few sellers that are interdependent? OligopolyWhat do gasoline for a bike, mustard for hot dogs, and a pair of gloves have in common?They are goods.Which term refers to regional countries that form an organization to promote the free movement of resources and products among its members and to create common economic policies?a. economic communityIf the developing African country of Ethiopia were struggling to provide clean water to its citizens in rural areas, where would they most likely seek assistance? The World Bank. Which of the following is NOT one of the principles companies use as a guide when leveraging cradle-to-cradle methodology? material underutilizationCanada has over 50programs related to product stewardship.greenwashing,where a company provides inaccurate informationor exaggerated and unsubstantiated claims about their products or services to mislead consumers into believing their goods and services are sustainable, when in fact they may not be seeing the full picture.Penetration pricingis the strategy of selling new products at low prices in the hope of achieving a large sales volume and market share, hopefully before the competition can react.