Strategies

Arguments for social involvements of businesses

Public needs have changed, leading to changed expectations. Business it is suggested received its charter from society and consequently has to respond to the needs of society.

Improvement of the social environment benefits both society and business. Society gains through better neighborhoods and employment opportunities, business benefits form better community. Since is the source of its work force and the consumer of its products and services.

Social involvement discourages additional government regulation and intervention. The result is grater freedom and more flexibility in decision making for business. Business has a great deal of power which, its reasoned, should be accompanied by an equal amount of responsibility.

Modern society is an independent system and the internal activities of the enterprise have an impact on the external environment.

Social involvement may be in the interest of stock holders.

Problem can become profits. Item that may once have been considered waste(for example, empty soft drink cans) can be profitably used again.

Social involvement crates a favorable public image. Thus a firm may attract customers, employees and inventors.

Business should try to solve the problems which other institutions have not been able to solve. After all business has a history of coming up with novel ideas.

Business has the resources. Specifically business should use its talented mangers and specialists, as well as its capital resources, to solve some of society’s problems.

It is better to prevent social problems through business involvement than to cure them. It may be easier to help the hand-core unemployed than to cope with social unrest.

Objective of Financial Management or Goals of Business Finance

Financial management is concerned with procurement and use of funds. Its main aim is to use business funds is in such a way that the earning are maximized. There are various alternatives available for using business funds. The pros and cons of various decisions have to be looked into before making a final selection the decisions will have to take into consideration for the commercial strategy of the business. The main objective of a business is to maximize the owner’s welfare. The objective can be achieved by

Profit Maximization Profit earning is the main aim of every economic activity. A business being an economic institution must optimize its profit to cover tis cost and provide funds for growth. No business can survive without earning profit. Profit is a measure of efficiency of a business enterprise.

Wealth Maximization Wealth maximization is the appropriate objective of an enterprise. Financial theory assets that wealth maximization is the single substitute for stockholder’s utility.

Capital budgeting decisions – Risk Analysis Capital budgeting is the process of making investment decisions in capital expenditures. Capital budgeting involves the planning and control of capital expenditure. It is the process of deciding whether or not to commit resources to a particular a long term project whose benefits are to be realized over a period of time, longer than one year.

Defining marketing for the twenty – first century

Today it is fashionable to talk about the new economy. We hear that business are operating in a globalize economy; that things are moving at a nanosecond pace; that our markets are characterized by hyper competition; that disruptive technologies are challenging every business; and that business must adapt to the empowered consumer. The old economy seemed simpler. It was based on the Industrial Revolution and on managing manufacturing industries. Manufactures applied certain principles and practices for the successful operation of their factories. They standardized products in order to bring down costs. They aimed to continually expand their market size to achieve economies of scale. They tended to replicate their procedures and policies in every geographic market. The goal was efficiency; and to accomplish this the firm was managed hierarchically, with a boss on top issuing orders to middle manager, who in turn guided the workers. The new economy, in contrast, is based on the Digital Revolution and the management or information. Information has a number of attributes. It can be infinitely differentiated, customized, and personalized. It can be dispatched to a great number of people who are on a network and it can reach them with great speed. To the extent that the information is public and accessible, people will be better informed and able to make better choices.

The Ten Rules of Radical Marketing

  •  The CEO must own the marketing function. CEOs of radical marketers never delegate marketing responsibility; they typically act like de facto chief marketing officers.”

  •  Make sure the marketing department starts small and flat and stays small and flat. In order to stay involved with marketing, CEOs must not allow layers of management to grow so numerous that they distance them from the market.

  •  Get fact-to-face with the people who matter most-the customers. For radical marketers, “face-to-face” is a mantra. “They know the advantages of direct interaction with customers.

  •  Use market research cautiously. Market research typically tells a marketer what the average customer wants. Radical marketers prefer grassroots techniques.

  •  Hire only passionate missionaries. Radical marketers “don’t have marketers, they have missionaries.”

  •  Love and respect your customers. Radical marketers respect customers as individuals, not as numbers on a spreadsheet. They recognize that the core customers are responsible for the bulk of their companies’ successes.

  •  Create a community of consumers. Radical marketers “encourage their customers to think of themselves as a community, and of the brand as a unifier of that community”.

  •  Rethink the marketing mix. Radical marketers marketing techniques often differ dramatically from those used by traditional marketers. For example, traditional marketers seek to reach broad audiences via large-scale advertising, while radical marketers use “surgical strike advertising” characterized by short, targeted ad campaigns.

  •  Celebrate common sense. Smaller companies with limited resources cannot hope to compete with larger competitors with out fresh and different marketing ideas. So radical marketers, for example, limit distribution in order to create loyalty and commitment among their distributors and among their customers.

  •  Be true to the brand. Radical marketers “are obsessive about brand integrity, and they are fixated on quality.”

The scope of marketing Marketing is typically seen as the task of creating, promoting, and delivering goods and services to consumers and businesses. Marketers are skilled in stimulating demand for a company’s products, but this is too limited a view of the tasks marketers perform. Just as production and logistics professional are responsible for supply management, marketers are responsible for demand management. Marketing managers seek to influence the level, timing, and composition of demand to meet the organization’s objectives.

Goods Physical goods constitute the bulk of most countries production and marketing effort. Each year U.S. companies alone market billions of canned and frozen food products, millions of tons of steel, millions of hair dryers, cars, television sets, machines, and various other mainstays of a modern economy. Not only do companies market their goods, but thanks to the Internet, even individuals can market goods.

eBay Today eBay is the world’s largest person-to-person online trading community. It offers efficient on-to-one trading in an auction format on the Web. Individuals can use eBay to sell or buy items in thousands of categories: paintings, stamps, coins, sports memorabilia, toys, dolls. Each day over 400,000 new items are offered, and more than 3.5 million auctions are in progress.

Services As economies advance, a growing proportion of their activities is focused on the production of services. The U.S. economy today consists of a 70-30 services-to-goods mix. Services include the work of airlines, hotels, car rental firms, barbers and beauticians, maintenance and repair people, dog kennels and dog therapists, as well as professional working within or for companies, such as accountants, lawyers, engineers, doctors, software programmers, and management consultants. Many market offerings consist of variable mix of goods and services. At the pure services end would be a psychiatrist listening to a patient or a quartet performing Mozart; at another level would be the telephone call that is supported by a huge investment in plant and equipment; and at a more tangible level would be a fast-food establishment where the customer consumes both a product and a service.