UGBS 101: INTRODUCTION TO

BUSINESS ADMINISTRATION [IBA]

Kwame Adom PhD

10/7/2021
KWAME ADOM PhD, Dept of Mktg & Entre 1
Agenda

1. Overview of the course

2. Discussion of today’s topic

3. Introduction of next week’s topic

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A Short video

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COURSE SYLLABUS
UGBS 101: INTRODUCTION TO BUSINESS ADMINISTRATION [IBA]

Lecture Period(s) and Venue: Mondays – 7.30am – 9.20am @ A1

3.30pm – 5.30pm @ A1
Lecturer:
Kwame Adom PhD
Office: 3W5. Office hours – \ – By Appointment
Email: [email protected]/[email protected]

TA: Michael Amoakoh

E-mail: [email protected]

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Course Description

This course provides a survey of the business world. Topics

include the basic principles and practices of contemporary
business. Upon completion, students should be able to
demonstrate an understanding of business concepts as a
foundation for studying other business subjects.

The course covers the following topics: Starting Out, Forms of

Ownership, The Entrepreneurship Spirit, Management and
Leadership, Human Resources, Marketing, Finance and
Investment amongst others.

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Course Objective
• To identify and describe the influence of the environments created by the economy,
technology, competition, diversity, global opportunities, and social responsibility.
• To compare the advantages and disadvantages of the major forms of business
ownership and discuss why many people are willing to accept the risks of
entrepreneurship.
• To understand the need for management in business organizations, the role of
management in developing an organizational structure, and the process of producing
products and services that satisfy customers.
• To describe the management role of acquiring and retaining human resources and
creating a supportive work environment.
• To explain the marketing function and describe the concepts and processes involved in
designing product strategy, promotion strategy, distribution strategy, and pricing
strategy.

• To describe the financial management function and the role of money and financial
institutions and to illustrate the concepts and processes involved in managing the
acquisition and allocation of short-term and long-term funds.
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Learning Goals
• At the completion of the course the student will be able to:
• Identify the potential marketing opportunities that are created by
the population trends;
• Relate how business institutions operate in our modern day
political, social and economic environment;
• Describe various business ownership forms; Acquire information
about starting your own business;
• Acquire a vocabulary for further study of business subjects;
• Describe the importance of marketing activities;
• Explain the challenges facing management;
• Identify basic long-and short-term financial planning techniques;
• Describe how organizations protect themselves against potential
losses.

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Academic Honesty
Academic honesty is fundamental to the integrity of university
education and degree programmes. UG will investigate and act to
enforce academic honesty policies where apparent violations occur.
Students should familiarize themselves with UG policy on academic
honesty.

While academic dishonesty can take many forms, there are several
forms of which students should be highly aware because they are the
ones that are most likely to occur in the context of a specific course.

Plagiarism policy: Plagiarism in any form is unacceptable in the

University of Ghana and shall be treated as a serious offence.
Appropriate sanctions, as stipulated in the Plagiarism Policy, will be
applied when students are found to have violated the Plagiarism
policy.

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Cheating: Cheating is an attempt to gain an unfair advantage in an
evaluation. Examples of such violations include (but are not limited to)
consulting prohibited materials during an examination or copying from
another student.

Aiding and abetting: A student is guilty of violating academic honesty

expectations if he/she acts in a way that enables another student to
engage in academic dishonesty. If a student knows (or should reasonably
expect) that an action would enable another student to cheat or
plagiarize, that student’s action constitutes an academic honesty
violation. Illustrative examples include making your exam paper easily
visible to others in the same exam or providing your own working or
finished documents for an ‘individual assignment’ to another student
(even if that other student said that he/she just wanted to ‘get an idea of
how to approach the assignment’ or ‘to check whether they had done
theirs correctly’).

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• Assessment and Grading (as applicable)
• Interim Assessment 30%
• Final Examination 70%
• 100%
Grading Scale:

The grading system is as stated in the Student Handbook is as follows:

• A 80-100%
• B+ 70-79%
• B 60-69%
• C 50-59%
• D 40-49%
• F 30-39%

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Reading List /Required Text
• S. Berston, S. C. Sawyer, C. Williams (2012). Business: A Practical Introduction.
Prentice Hall.
• O. C. Ferrell, G. Hirt, L. Ferrell (2000). Business: A Changing World. 10 th Edition.
McGraw-Hill Higher Education.

Other Information

Note on Classroom Etiquette

In order to stimulate participation and create effective learning,

laptops/IPods/IPhones/IPads and other tablets are not permitted to be used in class. All
lecture slides will be e-mailed to you.

Cell phones must be turned off and out-of-sight. Again, to encourage effective learning,
no texting is permitted in class

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Classroom Etiquette

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Week Topic Class/Lecture Plan

1 Starting Out Business and Profits

The Business Environment
Forces in Business Environment
2 The Entrepreneurial Spirit Small Business and Entrepreneurship
Achieving Success in a Small Business

3 Forms of Ownership Sole Proprietorship

Partnerships
Corporations

4 Presentations

5 Management and Leadership Functions of Management

The Effective Organization SWOT Analysis
Organizational Change

6 Operations Management Production Process

Operations Planning
Quality Assurance
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Motivating Employees Motivation
7 Finding Great People
Human Resource Management

8 Guest Speaker

Marketing Consumer Buying Process

9 The marketing Strategy
Product and Pricing
Distribution and Promotion The Distribution Mix
10 Advertising and Public Relation
Strategies
Financial Statements
11 Accounting and Financial Systems Statement of Accounts

Financial Planning
Financial Leverage and Cost of
12 Financial Management
Capital
The Money Supply

13 Presentations

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PART ONE:
TODAY’S BUSINESS
ENVIRONMENT
Chapter Learning Objectives
 Business and Profits: The Basis of Wealth

 Business as Benefactor: Payoffs Beyond Money Risk,

Entrepreneurship and the Factors of

 Production: The Creative Fire of Business

 The Business Environment: Forces that Encourage and

Discourage Entrepreneurship

 Seven Key Business Rules: The Great Adventure of Being in

Business in the 21st Century.
1-16
Business and Profits: The Basis of Wealth

• Business seeks to make a profit by selling goods or

services to others.
• For-Profit & Nonprofit Organizations
– For-Profit Organizations are formed to make money or
profits by selling something
– Nonprofit Organizations are formed to offer products
or services and their purpose is not to distribute
surplus funds or profits to owners, but rather to further
their goals
– Note NGOs are a bit different in that the
depend mainly on donations for their activities
and without that their activities are hampered
1-17
How does a Business Make Money?

• Selling Goods and Services

– Selling – the exchange of goods or services for an

agreed sum of money

– Goods – tangible products

– Services – intangible products

– Profit – the amount of money a business makes

after paying all its expenses

1-18
Business as Benefactor

Payoffs Beyond Money

◼Quality of Life
◼Raising the Standard of Living
Benefiting Society
◼Producing Goods and Services
◼Providing Paychecks and Benefits
◼Paying Taxes
◼Donating Funds and Goods to Charity

1-19
Wealth, Entrepreneurship, & Risk

• How do people make their money?

– Most of the wealthy are self-employed
business owners
• Entrepreneurship & Risk
– Risk is defined as the possibility that the
owner of a business may invest time &
money and the business may fail

1-20
Factors of Production

1-21
The Business Environment

• Companies operate within the business

environment which consists of economic,
technological, competitive, global and social
forces that will either encourage or discourage
the development of business.

1-22
Forces in the Business Environment

1-23
Seven Key Business Rules for Success

1-24
Self-Development Rule #1 - Stakeholders

1-25
Self-Development Rule #2 - Uncertainty

• Some Current Conditions of Uncertainty

– Economic Changes
– Speed of Information
– E-Commerce
– Climate Change
– Terrorism
– Computer Security

1-26
Self-Development Rule #3 - Competition

• Four Areas of the Competitive

Environment
– Being responsive to customers
– Making continual improvement in the
quality of your product or service
– Finding ways to deliver new or better
products or services
– Striving for employee efficiency

1-27
Self-Development Rules #4 & #5 –
Globalization & Social Responsibility

• You must deal with an interdependent

global economic system
– Globalization is the trend of the world
economy toward becoming a more
interdependent system
• You must be ethical and socially
responsible

1-28
Self-Development Rule #6 - Diversity

• You must learn to deal with different

kinds of people
– Rapidly changing demographics
– Need for diversity for business to thrive
– Complexity of working in a diverse
environment
• The Challenge: To maximize the contributions of
extremely diverse employees and serve the
needs of extremely diverse customers

1-29
Self-Development Rule #7

• To be successful you should cultivate the

following personal skills:
– Ability to perform a specific job
– Ability to think analytically
– Ability to interact well with people

1-30
What have learned?

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Learning Objectives Summary

• Business & Profits, The Basis of Wealth

• Business as Benefactor: Payoffs beyond
Money
• Risk, Entrepreneurship & the Factors of
Production, The Creative Fire of Business
• The Business Environment: Forces that
Encourage and Discourage Entrepreneurship
• Seven Key Business Rules: The Great
Adventure of being in Business in the 21st
Century

1-32
NEXT WEEK
The Entrepreneurial Spirit

• Small Business and Entrepreneurship

• Achieving Success in a Small Business

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STARTING & GROWING
A SUCCESSFUL
BUSINESS
Chapter Learning Objectives
• Small Business and Entrepreneurship
• The World of Small Business
• Starting Up: From Idea to Business Plan
• Getting Financing
• Achieving Success in Small Business

6-35
Small Business & Entrepreneurship
• Micropreneurs
• Small Business Owners
• Entrepreneurs

• Types of Entrepreneurs
– Classic
– Intrapreneurs
– Entrepreneurial Teams
Small Business & Entrepreneurship
• How do people become entrepreneurs?
– Opportunity vs. Necessity

• Do you have what it takes to be an entrepreneur?

– High Self-Confidence & Belief in Personal Control
– High Need for Achievement & Action Orientation
– High Tolerance for Ambiguity & Risk
– High Energy Level

6-37
The World of Small Business
• Contributions of Small
Business
o Employment
o Job creation
o First jobs for new employees
o Innovation

• Types of Small Businesses

– Home-based
– Web-based

6-38
The World of Small Business
• Owning Your Own Business: Buy or Start?
– Buying: reduces uncertainty & generates profits quickly
• Looking Over & Negotiating an Existing Business
– How does the business work?
– Why is the owner selling?
– Is the price right?
• Selling your business: Reasons
– Make money
– Beaten by competitors
– Tired of running the business
– Health problems

6-39
Starting Up
• It Begins with an Idea
• Learning about Business, Getting Experience
Step 1: Read about business
Step 2: Talk to knowledgeable people
• Mentors
• SCORE
• ACE
• Trade Associations
Step 3: Get experience

6-40
Starting Up – The Business
Plan
• What is a Business Plan?
• Why Write a Business Plan?
– Help you get financing
– Help you think through important details
– Help you plan for success
• How Do You Conceptualize It?
– The business model
• Is It Really Necessary? Reasons Why Not:
– May need to act fast
– May be able to get financing without one
– Many firms have done well without one

6-41
Getting Financing
• Personal Savings, Credit Cards & Second Mortgages
• Family & Friends
• Supplier & Barter Arrangements
• Financial Institutions
• Small Business Administration–Backed Loans
• Angel Investors & Venture Capitalists
• Public Stock Offerings
• Other Funding Sources
– Incubator
– Enterprise zone

6-42
Achieving Success in a Small
Business
• Why small businesses fail
– Inadequate management skills
– Lack of financial support
– Difficulty hiring & keeping good employees
– Aggressive competition
– Government paperwork
• How to keep a small business healthy
– Keep good records & know when to ask for help
– Stay in tune with your customers
– Learn how to manage employees

6-43
What have learned?

• Small Business and

Entrepreneurship

• The World of Small Business

• Starting Up: From Idea to Business

Plan

• Getting Financing

• Achieving Success in a Small

Business
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Next week
Forms of Ownership

• Sole Proprietorship

• Partnerships

• Corporations

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Chapter Learning Objectives
• Basic Forms of Business Ownership
• Franchises & Special Forms of
Ownership
• Mergers & Acquisitions

5-46
Basic Forms of Ownership

5-47
Sole Proprietorships
• Benefits

– You can start up the business with ease

– You can make all your own decisions

– You get to keep all the profits

– Your taxes are relatively simple

– You can close the business with ease

5-48
Drawbacks
– You have unlimited financial liability

– You have limited financial resources & few fringe

benefits

– You have limited management resources

– You will be investing a lot of time in the company

– Many businesses end when the owner dies or

retires

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Partnerships
Four Types

 General

 Limited

 Master Limited

 Limited Liability

5-50
Advantages

 Ease of start up

 Increased financial resources

 Increased management resources

 Decision making

 Fewer regulatory control

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Drawbacks

 Personality or partnership conflicts

 Unlimited liability

 Life of the partnerships

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Partnership agreement Sample
1 Name, Purpose, location
2 Duration of the agreement
3. Authority and responsibility of each partner
4. Character of partners (i.e. general or limited, active or silent)
5. Amount of contribution from each partner
6. Division of profits and losses
7. Salaries of each partner
8. How much each partner is allowed to withdraw
9. Death of a partner
10. Sale of the partnership interest
11. Arbitration of disputes
12. Required and prohibited actions
13. Absence and disability
14. Restrictive covenant
15. Buying and selling agreement
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Corporations
Advantages

– Little or no liability

– Possible tax breaks

– Increased financial resources

– More managerial expertise

– Ease of selling

5-54
Drawbacks
– Lots of start-up paperwork and costs, some on-
going

– Can be taxed twice

– Need to publicly disclose financial information

– Tough to end the corporation

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Cooperatives
• Limits the power of each shareholder

• Less about profit, more about providing a service

• Over 460,000 in the U.S. today

• Includes some Fortune 500 companies, like Ace

Hardware and Sunkist

• Shareholders elect their own board of directors

5-56
Franchises

A franchise is an arrangement in which a

business owner allows others the right to use its
name and sell its goods or services within a
specific geographical area.

5-57
Franchising

• A contractual agreement between a franchisor

and a retail franchisee that allows the
franchisee to conduct business under an
established name and according to a given
pattern of business

• Franchisee pays an initial fee and a monthly

percentage of gross sales in exchange for the
exclusive rights to sell goods and services in an
area
KWAME ADOM PhD, Dept of Mktg & Entre 2021-10-07 Slide 58
Franchises – Benefits

– Own your own business

– Start your new enterprise with some name recognition

– Follow someone else ’ s proven formula for doing

business

– Receive marketing support

– Receive management and financial support

5-59
Drawbacks
– Large initial investment

– Need to share sales with franchisor

– Close management of franchisor

– Potential conflicts with franchisor

– Inflated expectations of return on investment

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Mergers and Acquisitions
• How to Grow
– Internal expansion
– External expansion
– Merger
– Acquisition

• Why Mergers & Acquisitions Occur

– Shortcut to growth
– Management talent
– Saving money
– Tax benefits

5-61
Mergers and Acquisitions
• Types of strategic mergers
– Horizontal: same industry, same activity
– Vertical: same industry, different activities
– Conglomerate: different industries, different activities
• Unfriendly mergers
– Hostile takeovers
• Tender offer & Proxy fight
• “White Knights” & “Poison pills”
– Borrow & Buy Strategies
• Leveraged buyout
• Employee buyout

5-62
Learning Objectives Summary

• Basic Forms of Business Ownership

• Franchisees
• Mergers & Acquisitions

5-63
MANAGEMENT
Agenda

• Discuss today’s topic

• Introduction of next week’s topic

A Short video

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Management: The 4 Essential Functions

• Need for Management

– Effectiveness – realizing goals
– Efficiency – means of realizing goals
• Four Things Managers Must Do
– Planning
– Organizing
– Leading
– Controlling

7-66
4 Functions of Management

Planning: You need to set goals and decide how to achieve them

Organizing: You need to arrange tasks, people, and other resources to

accomplish the work

Leading: You need to motivate people to work hard to achieve the

organization’s goals

Controlling: You need to monitor performance, compare it with goals, and

take corrective action as needed. .

. . .so as to accomplish the firm’s goals. You need to do these tasks to

achieve the organization’s goals effectively and efficiently

7-67
The Levels of Management

7-68
Decision Making

• Identify the problem or opportunity

Phase 1

• Dream up possible solutions

Phase 2

• Weigh alternative solutions and select one

Phase 3

• Implement the solution, then evaluate it

Phase 4

7-69
Planning: Goals and Achievement

• Four benefits of planning

▪ Dealing with uncertainty
▪ Thinking ahead
▪ Coordinating activities
▪ Evaluate progress

• Basis for Planning: Vision and Mission

– Vision – what you want to become
– Mission – fundamental purposes

7-70
Three Types of Planning

Type Who does it? Time Frame

Strategic Top Managers 1-5 years

Tactical Middle Managers 6-24 months

Operational Supervisory Managers 1-52 weeks

7-71
SWOT Analysis

7-72
Organizing: The Org Chart

7-73
Management Skills
1. Technical Skills: The ability to perform
a specific job
2. Human Skills: The ability to interact
well with people
3. Conceptual Skills: The ability to think
analytically

7-74
Leading: Motivation towards Goals

• Leader vs. Manager

 Dealing with Change vs. Complexity

• Leadership Styles
– Autocratic
– Participative (Democratic)
Leadership
– Free-rein

7-75
Transaction vs. Transformational

• Transactional Leaders
• Transformational Leaders
– Inspire motivation by promoting a grand
design
– Inspire trust by expressing their integrity
– Encourage employee development
– Communicate a strong sense of purpose

7-76
Controlling
• Why is controlling needed?
– To deal with changes and uncertainties
– To become aware of opportunities
– To detect errors and irregularities
– To increase productivity, eliminate waste,
reduce costs or to add value
– To deal with complexity
– To decentralize decision making and
facilitate teamwork

7-77
Control Process

Establish Standards

Monitor Performance

Compare performance
against standards

Take corrective action,

if needed

7-78
Learning Objectives Summary

• Management: What It is, How You Do it

• Planning: You Set Goals and Decide How to
Achieve Them
• Organizing: You Arrange Tasks, People & Other
Resources to Get Things Done
• Leading: You Motivate People to Work to Achieve
Important Goals
• Controlling: You Monitor Performance, Compare it
with Goals & Take Corrective Action.

7-79
NEXT WEEK

The Effective Organization

Five Stages of Organizational Decline

• Hubris born of success

• Undisciplined pursuit of more
• Denial of risk and peril
• Grasping for salvation
• Capitulation to irrelevance or death

8-81
Organizational Change
• Areas in which change is often needed:
– People
– Technology
– Strategy
– Structure
• How are changes implemented?
– Recognize problems & opportunities, and devise
solutions
– Gain allies
– Overcome employee resistance

8-82
Culture
• How corporate culture is communicated
– Heroes
– Stories
– Symbols
– Rites & Rituals
• How culture influences an organization’s members
– Goal Understanding
– Organizational Identity
– Collective Commitment
– Social-System Stability

8-83
Structure
• Authority, Accountability & Responsibility
• Division of Labor, Work Specialization
• Hierarchy of Authority: The Chain of Command
• Span of Control: Narrow or Wide
• Delegation: Line vs. Staff
• Centralization vs. Decentralization of Authority

8-84
Four Principal Types of Structures

❖Departmentalization
❖Four basic types
 Functional

 Divisional

 Hybrid

 Matrix

8-85
Functional Structure

8-86
Divisional Structure

8-87
Divisional Structure

8-88
Hybrid Structure

8-89
Matrix Structure

8-90
Networks & Teamwork
 Networks
 Virtual Organizations
 Modular structure
 Teamwork
 Action
 Production
 Project
 Advice
 Cross-functional
8-91
PART THREE:
MANAGEMENT
Chapter Learning Objectives

• Operations Management: How goods and

services are produced
• Production Processes: Improving production
techniques
• Operations management Planning: Designing
and managing production operations
• Quality Assurance: Producing better products
and services

9-93
Operations Management

9-94
Production Process
• Form Utility – value that people add in
converting resources into finished
products
– Analytic transformation
– Synthetic transformation

• Conversion Process
– Continuous
– Intermittent

9-95
A Short History of Production
• Mechanization
• Standardization
• Assembly Line
• Automation
• Mass Production

9-96
Improving Production
• CAD, CAM, and CIM
– Computer-Aided Design
– Computer-Aided Manufacturing
– Computer-Integrated Manufacturing
• Flexible Manufacturing Systems (FMS)
• Lean Manufacturing
• Mass Customization

9-97
Operations Planning: Facility Location

• Availability and Cost of Resources:

Materials, Energy, and Labor
• Nearness to Suppliers
• Nearness to Customers: Reducing Time
to Market
• Tax Relief and Local Government
Support

9-98
Operations Planning: Facility Layout

9-99
Purchasing, Inventory, and Suppliers

• Purchasing
– Dealing with suppliers
– Inventory & inventory control
• Supply Chain Management
• Just-in-Time (JIT)
• Materials Requirement Planning (MRP)
• Enterprise Resource Planning (ERP)

9-100
Scheduling Tools: Gantt Chart

9-101
Scheduling Tools: PERT Chart

9-102
Quality Assurance
• Quality & Quality Assurance
• Total Quality Management
• Four Components of TQM:
– Make continuous improvement a priority
– Get very employee involved
– Listen to & learn from customers and employees
– Use accurate standards to identify and eliminate
problems

9-103
Quality Assurance
• Three Quality Control Techniques:
– ISO 9000
– Statistical Process Control
– Six Sigma

9-104
Learning Objectives Summary

• Operations Management: How goods and

services are produced
• Production Processes: Improving production
techniques
• Operations management Planning: Designing
and managing production operations
• Quality Assurance: Producing better products
and services

9-105
PART THREE:
MANAGEMENT
Motivation
• What it is & how it works
• Types of Rewards
– Extrinsic
– Intrinsic

10-107
Taylor, Gilbreth & Mayo
• Taylor: Scientific Management
– Time-motion studies
• Gilbreth: Principle of motion economy
• Mayo: Hawthorne Effect

10-108
Maslow’s Hierarchy of Needs

10-109
Hertzberg’s Two-Factor Theory
❖Two-factor theory
 Motivating factors
 Hygiene factors

10-110
Job Enrichment
• Fitting people to jobs
– Job simplification
• Fitting the job to the person
– Job enlargement
– Job enrichment
• The practical significance

10-111
Theories X, Y, and Z
• McGregor: Theory X
& Theory Y
– Pessimism vs.
Optimism
• Ouchi: Theory Z

10-112
Reinforcement & Expectancy

• Reinforcement Theory
– Positive Reinforcement
– Negative Reinforcement
– Extinction
– Punishment
• Vroom’s Expectancy Theory
– Three calculations

10-113
Adams’ Equity Theory
❖Elements of Equity
Theory
 Contributions
 Returns
 Comparisons
❖Reducing Inequality

10-114
Goal-Setting Theory & MBO
• Goal qualities
– Specific
– Challenging
– Achievable
• Management by
objectives (MBO)

10-115
Motivation: Looking Forward
• Future employees want:
– Balance between work and life
– Learn additional skills
– Doing something that matters
• Treating employees well
• Listening
• Praise

10-116
Human Resource Management
Finding Great People
• Human Capital
• Staffing
• Human Resource Management
• Determining Human Resource Needs
– Job analysis
– Job description
– Job specification

11-118
Laws Affecting HRM
• Labor Relations
– Unions & collective bargaining
• Compensation and Benefits
• Workplace Health and Safety
• Equal Employment Opportunity
– Discrimination
– Affirmative Action
– Sexual harassment

11-119
Recruiting Process
• Internal Recruiting
• External Recruiting
• Getting Noticed
– Networking – in-person,
online & social
– Internship
– Contingent work

11-120
Selection Process

• Background
Information
– Résumés
– Applications
– Reference Checks
– Credit & Legal Checks
• Interviewing
– Unstructured vs.
Structured
• Employment tests
– Reliability & Validity

11-121
Orientation, Training and Development
• Orientation: the first
30-90 days on the job
• Training &
Development
– On-the-job training
– Shadowing
– Apprenticeship
– Job rotation
– Off-the-job training
– Vestibule
• Mentoring
11-122
Performance Appraisals
• Types of Performance Appraisals
– Formal vs. Informal
– Objective vs. Subjective
• Other Evaluators Besides Managers
– Reports by coworkers
– Self-evaluation
– 360-degree

11-123
Performance Appraisals
❖ Grading employees on
the curve
 Forced ranking (“rank &
yank”)
❖ Giving & receiving
effective performance
feedback
 Problem solving
 Just the facts
 Employee input

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Compensation
• Base Pay
• Benefits
• Incentives
• Other
inducements

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Moving & Replacing Employees
• Promotion: moving
upward
• Transfer: moving
sideways
• Disciplining:
suspensions &
demotions
• Dismissal: lay offs,
downsizing, or firing
• Skills for success

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PART FOUR:
MARKETING
Marketing
• Four Eras of Marketing
• Delivering Value
• Products, Product Lines, Product Mixes

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Consumer Buying Process

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Factors Influencing Buying Behavior

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Marketing Strategy
• Marketing Strategy
– Market segmentation
– Target marketing
strategy
• Market Segmentation
– Geographic
– Demographic
– Psychographic
– Benefit
– User-rate
• Target Segmentation
• B2B Marketing Copyrigh
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Marketing Process: The 4-Ps
• Developing New
Products
• The Marketing
Process:
The 4-Ps
– Product
– Pricing
– Place
– Promotion Copyrigh
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Marketing Research
• Define the Problem
• Collect Facts
– Secondary data
– Primary data
• Analyze the Data
• Take Action

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External Marketing Environment

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Learning Objectives Summary
• Marketing: What It Is, How It Evolved
• Consumer Buying Behavior
• Marketing Strategy and Types of
Markets
• The Marketing Process: The 4-P
Marketing Mix
• Marketing Research and the Marketing
Environment
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Product & Pricing
Product Strategy
• Total Product Offer
• Consumer Markets
– Convenience
– Shopping
– Specialty
– Unsought

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Business Marketing

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Innovation
• Three Types of Innovation
– Continuous
– Dynamically Continuous
– Discontinuous

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Product Life Cycle

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Developing a New Product

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Product Differentiation: Branding
• Brands
– Brand names
– Brand marks
– Trademarks
• Types of Brands
– Manufacturer’s brands
– Private-Label brands
– Family brands
– Individual brands
– Co-branding
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Product Differentiation: Branding

• Four Goals of Branding

• To publicize the company name & build trust
• To differentiate the company’s product from competing
products
• To get repeat sales
• To make entering new markets easier
• Judging the Value of a Brand
• Brand equity
• Brand Loyalty
• Awareness
• Preference
• Insistence
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Production Differentiation: Packaging

❖Five functions of packaging:

 Protect the product
 Help consumers use the product
 Provide product information
 Indicate price & universal product code
 Promote the product & differentiate it from
competitors

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Pricing Strategies
 Five Possible Goals
◼Make a profit (target return on investment)
◼Match or beat the competition
◼Attract customers
◼Make products more affordable to certain groups
◼Create prestige
 Break-Even Analysis

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Pricing Strategies
 Principal Pricing ❖ Alternative Pricing
Strategies Strategies
◼Cost pricing ▪ Price skimming
◼Target costing ▪ Penetration pricing
▪ Discounting
◼Competitive
▪ Everyday low pricing
pricing (EDLP)
▪ Bundling
▪ Psychological pricing
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PART FOUR:
MARKETING

Chapter Fourteen – Distribution & Promotion

Strategies
Chapter Learning Objectives
• The Distribution Mix: Marketing Channels
• Intermediaries: Wholesalers, Agents and
Brokers, and Retailers
• Physical Distribution: Supply Chains and
Logistics
• The Promotion Mix: Tools, Goals and
Strategies
• Advertising and Public Relations
• Personal Selling and Sales Promotion
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The Distribution Mix: Marketing
Channels
• 4-P Marketing Mix Continued
– Place
– Promotion
• Distribution Mix
– Available Distribution Channels
– Intermediaries
– Distribution Mix
– Distribution Strategy
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Types of Distribution Channels

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Intermediary Value Added

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Distribution Strategies
• Intensive Distribution

• Selective Distribution

• Exclusive Distribution

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Types of Intermediaries
• Wholesalers
– Manufacturer-owned wholesaler
– Full-service merchant wholesaler
– Limited-function merchant wholesaler
• Agents & Brokers
• Store Retailers
• Nonstore Retailers
• Direct Marketing
• Video Marketing
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Online Retailing

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Physical Distribution
 Supply Chain
Management
 Logistics
 Transportation
▪ Rail
▪ Road
▪ Pipeline
▪ Water
▪ Air
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Warehousing
• Materials handling
• Storage warehouses
• Distribution Centers

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Promotion Mix: Tools, Goals &
Strategies
 Promotion Mix
 Integrated Marketing Communication
 Goals
 Inform
 Persuade
 Remind
 Push vs. Pull Strategies
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Advertising: Types & Strategies

• Types  Strategies
– Brand advertising  Informational
– Institutional  Reminder
advertising  Persuasive
– Public service  Competitive
advertising  Direct action
 Fear appeal

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Advertising Media
❖Types of Advertising Media
▪ Newspaper, magazines, TV, radio
▪ Direct mail, outdoor, Internet

❖Media Selection Considerations

▪ Reach
▪ Frequency
▪ Continuity
▪ Cost
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Public Relations

• Publicity
– Press release
– News release
– Publicity release
• Public relations (PR)

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Personal Selling

 Personal Selling
 Sales Tasks
 Creative selling
 Order processing
 Sales support
 Public Relations (PR)

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7 Steps of Personal Selling Process

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Sales Promotion Strategies
 Trade Promotion: Business-to-Business
Promotion (B2B)
 Consumer Oriented Sales Promotion:
Business-to-Consumer (B2C)
 Guerrilla Marketing
 Word-of-Mouth Marketing

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Different Marketing Strategies

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Learning Objectives Summary
• The Distribution Mix: Marketing Channels
• Intermediaries: Wholesalers, Agents and
Brokers, and Retailers
• Physical Distribution: Supply Chains and
Logistics
• The Promotion Mix: Tools, Goals and
Strategies
• Advertising and Public Relations
• Personal Selling and Sales Promotion
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PART FIVE:
FINANCIAL RESOURCES

Chapter Fifteen – Accounting and Financial

Systems
Chapter Learning Objectives
• Accounting: Users and Practitioners
• The Accounting Process: Six Steps for
Analyzing an Organization’s Finances
• Financial Statements and Financial
Analysis: The Vocabulary of Accounting
• Using Financial Analysis to Dig Deep:
Ratio Analysis
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What Is Accounting?
• Measuring, classifying, analyzing, and
communicating of financial information
to help people inside and outside a
company make good financial decisions.

• Differs from bookkeeping, which is the

recording of a firm’s financial
transactions.
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Users

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Practitioners
• Managerial Accounting
• Financial Accounting
• Private
– CMA or CIA
• Public
– CPA
• Tax Accountants
• Not-for-Profit Accountants
• Forensic Accountants
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GAAP
A financial statement This means:
should be:
Relevant Help users understand the company’s
financial
status and financial performance.
Reliable Be accurate, objective, and verifiable.
Consistent Always be based on the same assumptions
and
procedures (and any changes must be
clearly
explained).
Comparable Allow users to compare it (1) with other
firms’
information and (2) at different times.
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The 6 Steps of the Accounting Process

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Financial Statements

• Accounting Equation
– Assets + Liabilities = Owners’ Equity
• Balance Sheet: What they are
worth?
– Assets
– Liabilities
– Owner’s Equity
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Financial Statements

• Income Statement: What is left from

revenue after expenses are taken
out?
– Sales Revenue
– Cost of Goods Sold
– Operating Expenses
– Net Income
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Statement of Cash Flows

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Ratio Analysis
1. Liquidity Ratios
2. Activity Ratios
3. Debt to Owners’ Equity Ratio
4. Profitability Ratios

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Learning Objectives Summary
• Accounting: Users and Practitioners
• The Accounting Process: Six Steps for
Analyzing an Organization’s Finances
• Financial Statements and Financial
Analysis: The Vocabulary of Accounting
• Using Financial Analysis to Dig Deep:
Ratio Analysis
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PART FIVE:
FINANCIAL RESOURCES

Chapter Sixteen – Financial Management

Chapter Learning Objectives
• Financial Management and Financial Planning
• Finding Funds to Keep the Firm Operating
• Getting Short-Term and Long-Term Financing
• Money: What It Is, How It’s Controlled
• Banks and Other Financial Institutions
• The Changing Banking Environment:
Regulation, Deregulation and Financial Panics

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Financial Management
• Financial Managers
• Solvency and Efficiency

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Financial Planning
• Financial
Planning
– Forecasting
– Budgeting
– Financial Controls

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Finding Funds

• Borrowing Funds
– Managing everyday business
activities
– Extending credit to customers
– Keeping enough product available
– Making major investments

• Capital expenditures
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Short-Term Financing
• Short-Term Financing
– Trade credit
– Short-term loans
– Pledging and factoring
– Commercial paper

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Long-Term Financing
• Long-Term Financing
– Long-term loans
– Debt financing
– Equity financing

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Financial Leverage & Cost of Capital

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What Money Is

• Characteristics  Functions
– Portability  Medium of
exchange
– Divisibility
 Store of wealth
– Durability
 Standard of value
– Uniqueness
– Stability

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The Money Supply

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How Money is Created
• Fed’s Board of Governors & 12 Reserve
Banks
– Board of Governors
– Reserve Banks
• Fed’s Member Banks
• Getting Money to Banks
– Making currency available
– Making loans available
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How the Fed Controls the Money Supply

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Financial Institutions: Five Types

• Commercial Banks
• Savings institutions
• Credit unions
• Nonbanks – insurance companies,
pension funds, finance companies, and
brokerage firms
• Investment banks
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Commercial Banks

 Deposit  Make Money

Accounts from:
 Checking  Interest on loans
 Savings  Fees for services
 Fees from
 NOW
products
 Money market
 CDs

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Other Financial Institutions

• Savings  Nonbanks
Institutions  Insurance Companies
 Pension Funds
– Savings and
Loans  Finance Companies
 Brokerage Firms
– Mutual Savings
 Investment Banks
• Credit Unions

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How Your Money is Protected
 Federal Deposit Insurance Corporation (FDIC)
 Savings Association Insurance Fund (SAIF)
 National Credit Union Administration
(NCUA)

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The Changing Bank Environment

 Regulation
 Deregulation & Risky Investments
 Beginning of The 2008 Crash
 Links to the Global Financial System
 Confidence

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Learning Objectives Summary
• Financial Management and Financial Planning
• Finding Funds to Keep the Firm Operating
• Getting Short-Term and Long-Term Financing
• Money: What It Is, How It’s Controlled
• Banks and Other Financial Institutions
• The Changing Banking Environment:
Regulation, Deregulation and Financial Panics

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