Fall 2009 Crap

OB Chapter 12

2009-10-27T10:25:00.000-07:00

Power and Politics

· Definition of power – the capacity that A has to influence the behavior of B so that B acts in accordance with A’s wishes.
o Power exists even when it’s not used – it is therefore a capacity or potential.

· Power is a function of DEPENDENCY
o Dependency – the greater B’s dependency on A the greater A’s power in the relationship.

· Leadership and power are closely intertwined.
o Leaders achieve goals and power is a means of facilitating their achievement.
o They differ by:
§ Goal compatibility
§ Direction of influence
§ Research emphasis

· Formal power – based on someone’s position in an organization – can come from formal authority or the ability to coerce or reward.
o Coercive power – this is dependent on fear.
o Reward power – the opposite of coercive power. Accrues when people comply with the wishes or directives of another because doing so produces positive benefits.
o Legitimate power – the formal authority to control and use organizational resources. Includes acceptance by members in an organization of the authority of a position

· Personal power – power that comes from an individual’s unique characteristics.
o Expert power – influence wielded as a result of expertise, special skill, or knowledge
o Referent power – based on identification with a person who has desirable resources or personal traits.

· Research suggests that the personal sources of power are the most effective.

Power Tactics

· 9 distinct influence tactics
o Legitimacy
o Rational persuasion
o Inspirational appeals
o Consultation
o Exchange
o Personal appeals
o Ingratiation
o Pressure
o Coalitions

· Evidence indicates that rational persuasion, inspirational appeals, and consultation tend to be the most effective.

Power in Groups: Coalition

· Coalition – informal group bound together by the active pursuit of a single issue. The logic behind this is that there is strength in numbers.
o Coalitions in organizations seek to maximize their size.
o More coalitions will likely be created when there is a great deal of task and resource interdependence.
o The more routine the task of a group, the greater the likelihood that coalitions will form.

Power in Action: Politics

· Political behavior – activities that are not required as part of one’s formal role in the organization but that influence the distribution of advantages and disadvantages within the organization.

· Factors that encourage political behavior
o Individual factors
§ People who self-monitor have an internal locus of control and have a high need for power and are likely to engage in political behavior.
§ An individual’s investment in the organization, perceived alternatives, and expectations of success will influence the degree to which he or she will pursue political action.
o Organizational Factors – political activity is probably more a function of the organization’s characteristics than of individual difference variables
§ When an organization’s resources are declining, when the existing pattern of resources is changing, and when opportunity for promotions is present.
§ When an organization downsizes to improve efficiency
§ When there is little trust, there is higher political behavior
§ The more pressure that employees feel to perform well, the more likely there is to be political behavior

The Human Response to Organizational Politics

· When both politics and understanding are high, performance is likely to increase because the individual can see political actions as an opportunity. When understanding is low, individuals are more likely to see politics as a threat.

· When people perceive politics as a threat they often respond with defensive behaviors.

· Depending on culture someone might be more willing to use aggressive political tactics in the workplace.

Impression Management – the process by which individuals attempt to control the impression others form of them.

· Popular Impression Management techniques
o Conformity
o Excuses
o Apologies
o Self-promotion
o Flattery
o Favors
o Association

· Most job applicants use IM techniques in interviews and when it is used, it works.

· Applicants who use self-promotion more than ingratiation do better in interviews.

· In terms of performance ratings, ingratiation is positively related to performance ratings.

Summary –
If you want to get things done in a group or organization it helps to have power. As a manger who wants to maximize your power, you will want to increase others’ dependence on you. You can increase your power in relation to your boss by developing knowledge or a skill that she needs and for which she perceives no ready substitute. Power is a two-way street and you will not be alone in attempting to build your power bases. Others will be trying to make you dependent on them. The result is an unending battle. One way to increase your power in an organization is to acquire the bases of power that are most useful (expert, referent) and then to use the power tactics (consultation, inspirational appeal) that are most effective. Avoid tactics like coercion that tend to backfire. The effective manager accepts the political nature of organizations.

360-degree feedback reading

2009-10-21T16:39:00.000-07:00

New research shows that 360-degree feedback programs may hurt more than they help (10.7% decrease in shareholder value)
These programs generally focus on the manager level and above.
What are the problems with it?

1) giving appraisals is a difficult task.
2) there may be a gap between an organization's business objectives and what 360-degree feedback programs measure.
3) time and cost associated with 360-degree feedback also are stumbling blocks
4) Reviewers and those being reviewed fail to follow up after feedback.

One 360-degree feedback assessment that made an employee "look like Mother Theresa." The woman was very talented, he says, "but nobody walks on water like that. I conducted a series of personal interviews with the woman's raters to follow-up. After the interviews, I had a much better view of her strengths and weaknesses."
Rumely recommends that individuals sit down with their managers and their subordinates and review scores. "They should present their scores and then ask, 'Which ones do you think are the most critical to being as effective as possible, and what tactics are necessary to get there?"'
Recognize that 360-degree feedback is not a panacea. Just because an individual receives insight into his behavior doesn't mean he can--or will--change it.
The strength of 360-degrees feedback is that it reflects he varying perspectives of different rate groups. That's also part of the problem. What one group views as effective behavior, another group may see as problematic.

Day 10

2009-10-09T14:29:00.001-07:00

Eight Behavioral Roles

Shaper
- Engine of the team
- Driving, energetic, forceful
- PUSHES team in direction
- Wants action, likes pressure
- Extrovert (flashy dress/bright car)
- High need for achievement, winning
Coordinator
- Natural chairperson, PULLER
- Fair; everyone gets a say
- Clarifies goals, promotes decision making
- Tolerant enough to listen; strong enough to reject advice
- Calm in face of controversy
- Need for dominance shown as strong commitment to external goals
Idea Generator
- BRAINSTORMER
- Introverted, quiet, intelligent, creative
- "absent minded professor," drives old car until it breaks down
- Sometimes lacks social skills
- Highly original
- May ignore incidentals; may not communicate effectively
Resource Investigator
- NETWORKER; external liaison
- Relaxed, gregarious, positive
- Never in office unless on phone
- Creative; brings in new ideas
- Extrovert; strong on personal relationships
- Likes new things
- May be overly optimistic; lose interest
Monitor Evaluator
- CRITIC
- Cynical, intelligent, introverted
- Strong analytical skills
- Thinks strategically
- Collects information before acting
- Facts-based
- Can lack warmth, spontaneity
Implementer
- PLANNER, schedules, commits
- Disciplined, reliable, conservative
- Makes sure job gets done
- Will do dirty work if it helps get job done
- Turns ideas to action: who/what/when
- May be slow to respond to new possibilities
Completer Finisher
- DETAIL MANAGER with relentless follow-through as all stages
- Conscious, anxious, introverted
- Worries about what might go wrong
- Guarantees delivery, outcome
- Dots I's and crosses T's
- Unassertive, maintains urgency
Internal Facilitator
- Team DIPLOMAT (brings cookies)
- Perceptive and accommodating
- Solves conflict; averts friction
- Low dominance need
- Threat to no one; high sociability
- May avoid confrontation and be indecisive in crunch situations

Supply Chain Ch. 4

2009-09-28T11:36:00.001-07:00

Know:
How production processes are organized
The trade-offs that need to be considered when designing a production process
What the product-process matrix is
Understand how break-even analysis is just as important in operations and supply-chain analysis as it is in other areas
Understand how to design an assembly line
Key Terms
Project layout
- The product, because of its sheer bulk or weight, remains fixed in a location. Equipment is moved to the product rather than vice versa
Workcenter
- A process structure suited for low-volume production of a great variety of nonstandard products. Workcenters sometimes are referred to as departments and are focused on a particular type of operation
Manufacturing cell
- An areas where simple items that are similar in processing requirements are produced
Assembly line
- A process structure designed to make discrete parts. Parts are moved through a set of specially designed workstations at a controlled rate
Continuous process
- An often automated process that converts raw materials into a finished product in one continuous process
Product-process matrix
- Shows the relationships between different production units and how they are sued depending on product volume and the degree of product standardization
Workstation cycle time
- The time between successive units coming off the end of an assembly line
Assembly-line balancing
- The problem of assigning all the tasks to a series of workstations so that each workstation has no more that can be done in the workstations cycle time and so that idle time across all workstations is minimized
Precedence relationship
- The order in which task must be performed in the assembly process

Supply: Chapter 3

2009-09-18T12:23:00.001-07:00

Capacity Management in Operations
- Capacity is the ability to hold, receive, store, or accommodate.
  - The amount of output that a system is capable of achieving over a specific period of time.
  - Capacity must be stated relative to some period of time
- 3 time durations:
  - Long range -- greater than one year
  - Intermediate range -- monthly or quarterly plans for the next 6 to 18 months
  - Short range -- less than one month
- Capacity must be defined as the amount of resource inputs available relative to output requirements over a particular period of time.
- Strategic capacity planning -- to provide an approach for determining the overall capacity level of capital-intensive resources -- facilities, equipment, and over all labor force size.
Capacity Planning Concepts
- Capacity talks about how much can be attained, but doesn't say how long that rate can be sustained. The concept of best operating level is used to avoid the problem
- Best operating level -- the level of capacity for which the process was designed and thus the volume of output at which average unit cost is minimized
- Capacity utilization rate -- reveals how close a firm is to its best operating level.
  - = capacity used / best operating level
- Economies and Diseconomies of Scale
  - As a plant gets larger and volume increases, the average cost per unit of output drops.
  - At some point the size of a plant becomes too large and diseconomies of scale become a problem.
- Capacity Focus
  - A production facility works best when it focuses on a fairly limited set of production objectives. A firm should not expect to excel in every aspect of manufacturing performance.
  - This capacity focus concept can also be operationalized through the mechanism of plants within plants (PWPs).
- Capacity Flexibility
  - Having the ability to rapidly increase or decrease production levels, or shift production capacity quickly from one product or service to another
  - Flexible plants -- the zero-changeover-time plant. Quickly can adapt to change. Ringling Bros.
  - Flexible processes -- flexible manufacturing systems on the one hand and simple, easily set up equipment on the other.
  - Economies of scope -- exist when multiple products can be produced at a lower cost in combination than they can separately.
  - Flexible workers -- have multiple skills and the ability to switch easily from one kind of task to another.
The Learning Curve
- A line displaying the relationship between unit production and the cumulative number of units produced.
- Cost per burger when cumulative production reaches 10 million? -- If a firm has a 90 percent learning curve, costs will fall to 90% of $.55 or $.495, when accumulated production reaches 10 million.
- Learning curve theory
  - Amount of time required to complete a given task or unit of a product will be less each time the task is undertaken
  - The unit time will decrease at a decreasing rate
  - The reduction in time will follow a predictable pattern
- Plotting Learning Curves
  - Problem 3.1 and 3.2
Capacity Planning
- Considerations in adding capacity
  - Maintaining system balance -- in a perfectly balanced plant, the output of stage 1 provides the exact input requirement for stage 2
  - To deal with imbalance -- add capacity to stages that are bottlenecks. Also buffer inventories in front of the bottleneck stage to ensure that it always has something to work on. Also, duplicate the facilities of one department on which another is dependent.
- Frequency of capacity additions
  - Two types of costs to consider when adding capacity -- cost of upgrading too frequently, and upgrading too infrequently.
- External sources of operations and supply capacity
  - It may be cheaper sometimes to not add capacity at all, but to use some existing internal source of capacity.
  - Two common strategies -- outsourcing and sharing capacity
- Determining Capacity Requirements
  - Steps:
    - Use forecasting techniques to predict sales for individual products within each product line
    - Calculate equipment and labor requirements to meet product line forecasts
    - Project labor and equipment availablilities over the planning horizon
  - Capacity cushion
    - A capacity cushion is an amount of capacity in excess of expected demand.
  - Problem 3.3
- Use decision trees to evaluate capacity alternatives
  - Problem 3.4
Planning Service Capacity
- Capacity planning in service versus manufacturing
  - Time: -- in services managers must consider time as one of their supplies.. The capacity must be available to produce a service when it is needed
  - Location -- the service capacity must be located near the customer in face-to-face settings
  - Volatility of Demand -- ser vice system has higher volatility of demand than a manufacturing production system. This is because:
    - Services cannot be stored
    - Customers interact directly with the production system and they often have different needs
    - It is directly affected by consumer behavior
- Capacity utilization and service quality

Marketing: Chap. 5

2009-09-17T15:28:00.001-07:00

Consumer Markets and Consumer Buyer Behavior
- Harley has great customer loyalty.
- Harley's marketers put top priority on understanding customers and what makes them tick. Harley customers are buying a lot more than just a quality bike and a smooth sales pitch: "Things are different on a Harley."
- Consumer-buyer behavior
  - The buying behavior of final customers (individuals and households that buy goods and services for personal consumption)
  - Consumer market -- made up of all of the final consumers (all the individuals and households who buy or acquire goods and services for personal consumption)
Model of Consumer Behavior
- Understanding the "why" of buying behavior is very difficult.
- Model of buyer behavior
  - The environment
    - Marketing stimuli -- Product, price, place, promotion
  - Buyer's Black box
    - Buyer's characteristics
    - Buyer's decision process
  - Buyer responses
    - Buying attitudes and preferences
    - Purchase behavior; what the buyer buys, when, where, and how much
    - Brand and company relationship behavior
Characteristics Affecting Consumer Behavior
- Cultural factors
  - Culture -- the set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions
  - Subculture -- a group of people with shared value systems based on common life experiences and situations (ie: religions, nationalities, racial groups, etc.)
    - Hispanic consumers
      - Generics don't sell well to this group
    - African-American consumers
      - Strongly motivated by quality and selection, brands are important
    - Asian-American consumers
      - Most tech-savvy segment. They shop frequently and are the most brand conscious and are very brand loyal.
    - Mature consumers
      - They are not "stuck in their ways" but are more willing to shop around and switch brands than younger counterparts.
- Social Factors
  - Social class -- relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors.
    - Major American social classes
      - Upper, middle, working, lower.
  - Group -- two or more people who interact to accomplish individual or mutual goals
  - Word of mouth influence and buzz marketing
    - Opinion leader -- person within a reference group who exerts social influence on others because of special skills, knowledge, or personality.
    - Buzz marketing -- an opinion leader serves as a brand ambassador to spread the word about products.
  - Online social networks -- online social communities, blogs, etc. where people socialize or exchange information or opinions.
    - Marketers are working to harness the power of these networks to promote their products.
  - Family
    - Family can strongly influence buyer behavior
  - Roles and Status
    - Role is the activities people are expected to perform according to the persons around them. Each role carries a status reflecting the general esteem given to it by society
- Personal Factors
  - Age and Life-Cycle Stage
    - People change what they buy over time.
    - RBC identified 5 life-stage segments
      - Youth -- customers younger than 18
      - Getting Started -- customers age 18-35 -- going through first experiences
      - Builders -- age 35-50 -- tend to borrow more than invest
      - Accumulators -- age 50-60 -- worry about saving for retirement.
      - Preservers -- age 60 and up -- want to maximize retirement income.
  - Occupation -- a person's occupation affects the goods and services he buys.
  - Economic Situation -- economic situation affects product choice
  - Lifestyle -- a person's pattern of living as expressed in his or her activities, interests, and opinions
    - This lifestyle concept can help understand changing consumer values and how they affect buying behavior.
  - Personality and Self-Concept
    - Personality -- the unique psychological characteristics that lead to relatively consistent and lasting responses to one's own environment
    - Brand personality -- the specific mix of human traits that may be attributed to a particular brand
      - 5 brand personality traits
        Sincerity
        Excitement
        Competence
        Sophistication
        Ruggedness
- Psychological Factors
  - Motivation -- a need that is sufficiently pressing to direct the person to seek satisfaction of the need
    - A person has many needs at any given time. A need becomes a motive when it is aroused to a sufficient level of intensity
    - Freud thought that a person's buying decisions are affect by subconscious motives that even the buyer may not fully understand
    - Abraham Maslow sought to explain why people are driven by particular needs at particular times.
      - From most to least pressing here are the human needs according to Maslow
        Physiological needs (hunger, thirst)
        Safety needs (security, protection)
        Social needs (sense of belonging, love)
        Esteem needs (self-esteem, recognition)
        Self-actualization needs (self-development and realization)
      - People satisfy the most important first and then move on
  - Perception -- the process by which people select, organize, and interpret information to form a meaningful picture of the world
    - Selective attention -- the tendency for people to screen out most of the information to which they are exposed
  - Learning -- changes in an individual's behavior arising from experience
    - Drive -- strong internal stimulus that calls for action
  - Beliefs and Attitudes --
    - Belief -- descriptive thought that a person holds about something
    - Attitude -- a person's consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea.
    - Attitudes are difficult to change, thus a company should usually try to fit its products into existing attitudes rather than try to change attitudes
Types of Buying Decision Behavior
- Complex Buying Behavior -- consumer buying behavior in situations characterized by high consumer involvement in a purchase and significant perceived differences among brands
- Dissonance-reducing buying behavior -- consumer buying behavior in situations characterized by high involvement but low perceived differences among brands
  - Carpet is an example.. Buyers consider most brands to be the same and may regret it after they buy (called postpurchase dissonance).
- Habitual Buying Behavior -- consumer buying behavior in situations characterized by low-consumer involvement and few significantly perceived brand differences
  - Ad repetition creates brand familiarity, rather than brand conviction.
- Variety-seeking buying behavior -- consumer buying behavior in situations characterized by low consumer involvement but significant perceived brand differences
The Buyer Decision Process
- The actual purchase decision is just part of a much larger buying process -- starting with need recognition through how you feel after making the purchase. Marketers want to be involved in the whole process
- The considerations a consumer faces are as follows:
  - Need recognition
  - Information search
  - Evaluation of alternatives
  - Purchase decision
  - Postpurchase behavior
- Need Recognition -- the first stage of the buyer decision process, in which the consumer recognizes a problem or need
- Information search -- the stage of the buyer decision process in which the consumer is aroused to search for more information; the consumer may simply have heightened attention or may go into an active information search.
  - Generally a consumer gets the most information from commercial sources, which are the sources controlled by the marketer
- Evaluation of alternatives -- the stage of the buyer process in which the consumer uses the information to evaluate alternative brands in the choice set.
- Purchase decision -- the buyer's decision about which brand to purchase
  - Two factors can come between the purchase intention and the purchase decision:
    - Attitudes of others and unexpected situational factors.
- Postpurchase behavior -- the stage of the buyer decision process in which the consumers take further action after purchase, based on their satisfaction or dissatisfaction.
  - This depends on the consumer's expectations and the product's perceived performance.
- Cognitive dissonance -- buyer discomfort caused by postpurchase conflict.
The Buyer Decision Process for New Products
- New product -- good or service or idea that is perceived by some potential customers as new.
- Adoption process -- the mental process through which an individual passes from first hearing about an innovation to final adoption.
  - Stages in the adoption process
    - Awareness -- consumer becomes aware but lacks information
    - Interest -- consumer seeks info
    - Evaluation -- consumer decides if it makes sense to use it
    - Trial -- consumer tries it on a small scale to test it
    - Adoption -- consumer decides to make full use of the product
- Individual difference in innovativeness
  - Adopter categories are as follows from early to late:
    - Innovators -- venturesome
    - Early adopters -- guided by respect
    - Early majority -- deliberate though rarely leaders - adopt new ideas before the majority
    - Late majority -- they adopt an innovation only after a majority of people have tried it
    - Laggards -- tradition bound -- suspicious of changes
- Influence of Product characteristics on rate of adoption
  - Relative advantage
  - Compatibility
  - Complexity
  - Divisibility
  - Communicability

ORGB Ch.7

2009-09-17T10:49:00.001-07:00

Differentiate emotions from moods
- Affect
  - Covers a broad range of feelings that people experience. Can be experienced in the form of emotions or moods
- Emotions
  - Intense feelings that are directed at someone or something. There are dozens of emotions, including anger, contempt, enthusiasm, envy, fear, frustration, pride, surprise, and sadness
  - More action oriented
- Moods
  - Are feelings that tend to be less intense than emotions and that often lack a contextual stimulus
  - More cognitive, cause us to think or brood for a while
Discuss the different aspects of emotions
- Intensity
- Frequency and duration
- Do emotions make us irrational?
  - Our emotions provide important information about how we understand the world around us
  - The key to good decision making is to employ both thinking and feeling in one's decisions
- What functions do emotions serve?
  - We need them to think rationally
Identify the sources of emotions and moods
- Personality
- Day of the Week and Time of the Day
- Weather
- Stress
- Social Activities
- Sleep
- Exercise
- Age
- Gender
Describe external constraints on emotions
- Organizational influences
  - For the most part, the climate in well-managed US organizations is one that strives to be emotion free
- Cultural influences
  - The degree to which people experience emotions vary across cultures
  - In general, people form all over the world interpret negative and positive emotions the same way
  - Managers need to know the emotional norms in each culture they do business in so they don't send unintended signals or misread the reactions of locals
Discuss the impact emotional labor has on employees
- Emotional Labor: is an employee's expression of organizationally desired emotions during inter-personal transactions at work
- The true challenge is when employees have to project one emotion while simultaneously feeling another
- Felt Emotions: an individual's actual emotions
- Displayed Emotions: those that the organization requires workers to show and considers appropriate in a given job
- Surface acting: hiding one's inner feelings and forgoing emotional expressions in response to display rules
- Deep Acting: trying to modify one's true inner feelings base on display rules
Discuss the case for and the case against emotional intelligence
- Emotional Intelligence (EI): one's ability to detect and manage emotional cues and information
- EI is composed of five dimensions
  - Self-awareness: Being aware of what you're feeling
  - Self-management: the ability to manage your own emotions and impulses
  - Self-motivation: the ability to persist in the face of setback and failures
  - Empathy: the ability to sense how others are feeling
  - Social Skills: the ability to handle the emotions of others
- The Case for EI
  - Intuitive Appeal
  - EI predicts Criteria that matter: a high level of EI means a person will perform well on the job
  - Biologically based: EI is neurologically based in a way there's unrelated to standard measures of intelligence, and that people who suffer neurological damage score lower on EI and make poorer decision than people who are healthier in this regard
- The Case against EI
  - Too Vague a Concept
  - EI can't be measured
  - The validity of EI is suspect: not sure if they can rely on data
Apply concepts on emotions and moods to OB issues
- Selection
- Decision Making
- Creativity
- Motivation
- Leadership
- Interpersonal Conflict
- Negotiation
- Customer Service
- Job attitudes
- Deviant Workplace Behaviors

Org B: Chapter 6

2009-09-14T11:35:00.001-07:00

Motivation: From concepts to Applications

Motivating by changing the nature of the work environment
- Job design -- the way elements in a job are organized can act to increase or decrease effort
The Job Characteristics Model - proposes that any job can be described in terms of five core job dimensions:
- Skill variety
- Task identity
- Task significance
- Autonomy
- Feedback
  - The JCM says that individuals enjoy internal rewards when they
    - Learn that they
    - Personally have performed well on a task that they
    - Care about.
- Motivating Potential Score:
  - (Skill variety + Task Identity + Task significance)/3 * Autonomy * Feedback
How can Jobs be redesigned?
- Job Rotation
  - Strengths of job rotation are:
    - Reduces boredom
    - Increases motivation through diversifying the employee's activities
    - Helps employees better understand how work contributes to organization
- Job enlargement -- horizontal expansion of jobs
  - Increasing the number and variety of tasks that an individual performed resulted in jobs with more diversity
- Job Enrichment -- vertical expansion of jobs
  - Increases the degree to which the worker controls the planning, execution, and evaluation of the work
  - How to enrich a job?
    - Combine tasks
    - Form natural work units
    - Establishing client relationships
    - Expanding jobs vertically
    - Opening feefback channels
Alternative Work Arrangements
- Flextime
  - Short for "flexible work hours". Allows employees some discretion for when they come in and when they leave.
  - Benefits:
    - Reduced absenteeism
    - Increased productivity
    - Reduced overtime expenses
    - Lessening in hostility toward management
    - Reduced traffic congestion around work sites
    - Elimination of tardiness
  - Major drawback is that it's not applicable to every job.
- Job Sharing
  - Allows two individuals to split a traditional 40 hour work week
  - Job sharing allows the organization to draw on the talents of more than one individual in a given job.
- Telecommuting
  - Refers to employees who do their work remotely at least two days a week using computers linked to their offices.
  - What types of jobs can do this?
    - Routing information-handling tasks
    - Mobile activities
    - Professional and other knowledge-related tasks
  - Pluses for management?
    - Larger labor pool from which to select
    - Higher productivity
    - Less turnover
    - Improved morale
    - Reduced office-space costs

Employee Involvement
- A participative process that uses the input of employees to increase their commitment to the organization's success.
- Example of Employee Involvement Programs
  - Participative management
    - Subordinates actually share a significant degree of decision-making power with their immediate superiors.
  - Representative participation
    - Workers are represented by a small group of employees who actually participate in representative participation
    - Work councils and board representatives are the two main forms of representative participation
Rewarding Employees
- What to pay?
  - Internal equity -- the worth of the job to the organization
  - External equity -- the external competitiveness of an organization's pay relative to pay elsewhere in the industry
- How to Pay? -- Reward-based pay plans
  - Variable pay programs -- merit-based pay, bonuses, profit sharing, gain sharing, etc.
    - Piece-rate pay
      - Workers are paid a fixed sum for each unit of production completed
    - Merit-based pay
      - Based on performance appraisal ratings
      - Merit pay plans allow organizations to compensate for external factors that may have reduced objective performance measures due to no fault of the employee
    - Bonuses
      - Reward employees for recent performance rather than historical performance
    - Profit-sharing
      - Distribute compensation based on the company's profitability
    - Gain sharing
      - Improvements in group productivity
    - Employee Stock ownership plans
- How to Pay? -- skill-based pay plans
  - Sets pay levels based on how many skills employees have or how many jobs they can do.
- Skill-based pay in practice
  - Skill-based pay generally leads to higher employee performance, satisfaction, and perceptions of fairness in pay systems
- Flexible benefits:
  - Allows each employee to put together a benefit package individually tailored to his or her own needs and situation
    - Modular plans -- predesigned packages of benefits
    - Core-plus plans
    - Flexible spending plans
- Intrinsic Rewards: Employee Recognition Programs
  - Range from a spontaneous and private thank you up to a widely publicized formal programs in which specific types of behavior are encouraged and the procedures for attaining recognition are clearly identified.

Supply Ch.2

2009-09-14T11:23:00.001-07:00

Know what project management is and why it is important
- Project
  - A series of related jobs usually directed toward some major output and requiring a significant period of time to perform
  - Project types:
    - Derivative (incremental changes such as new product packaging or no-frills versions)
    - Breakthrough (major changes that create entirely new markets)
    - Platform (Fundamental improvements to existing products)
  - 4 major areas:

Product change
Process change
Research and development
Alliance and partnership

Project management
- Can be defined as planning, direction, and controlling resources (people, equipment, material) to meeting the technical, cost, and time constraints of the project

Know the different ways projects can be structured
- Pure project (skunkworks)
  - Where a self-contained team works full time on the project
- Functional project
  - Housing the project within a function division
- Matrix project
  - Attempts to blend properties of functional and pure project structures
Know how projects are organized into major subprojects
Know what a project milestone is
- Project milestone
  - A specific event in a project
  - Typical milestones might be the completion of the design, the production of a prototype, the completed testing of the prototype, and the approval of a pilot run
Know how to determine the "critical path" for a project
- Critical Path:
  - The sequence of activities in a project that forms the longest chain in terms of their time to complete. This path contains zero slack time. Techniques used to find the critical path are called CPM or critical path method techniques
Know how to "crash", or reduce the length, of a project
- Crash time:
  - The shortest possible activity time
- Crash cost
  - The coast associated with each crash time
- Slack time
  - For some activities in a project there may be some leeway in when an activity can start and finish
Critical Path Method (CPM)

Identify each activity to be done in the project and estimate how long it will take to complete each activity
Determine the required sequence of activities and construct a network reflecting the precedence relationships
Determine the critical path
Determine the early start/finish and late start/finish schedule

Org B: Chapter 5

2009-09-14T11:02:00.001-07:00

Motivation Concepts
- Defining Motivation
  - Motivation is the processes that account for an individual's intensity, direction, and persistence of effort toward attaining a goal.
    - Intensity = how hard a person tries
    - The intensity has to be channeled in a direction that benefits the organization
    - Persistence = how long a person can maintain effort
- Early Theories of Motivation
  - The hierarchy of needs theory
  - Theories x and y
  - The two-factor theory
    - Why these three theories?
      - They represent a foundation from which the contemporary theories have grown
      - Practicing managers still regularly use these theories in explaining motivation
- Hierarchy of Needs Theory
  - With every human there exists a hierarchy of five needs
    - Physiological -- hunger, thirst, bodily needs, etc.
    - Safety -- security from physical and emotional harm
    - Social -- affection, acceptance, friendship, etc.
    - Esteem -- internal: self-respect, achievement; external: status, recognition, etc.
    - Self-actualization -- achieving potential, self-fulfillment, etc.
  - To motivate someone, Maslow says you must know what level they're currently on and focus on satisfying the needs at or above that level.
  - It's a pyramid with physiological at the bottom.
  - Lower-order are physiological and safety -- satisfied externally
  - Higher-order are social, esteem, self-actualization -- satisfied internally.
- Theories x and y
  - McGregor's Theories.
    - Theory x -- 4 assumptions held by managers
      - Employees inherently dislike work
      - Employees must be coerced, controlled, or threatened in order to achieve goals
      - Employees will avoid responsibilities and seek direction whenever possible
      - Most workers place security above all other factors
    - Theory Y -- 4 positive assumptions
      - Employees can view work as being play
      - People will exercise self-direction and self-control if they're committed to objectives
      - Average person can learn to accept and seek responsibility
      - The ability to make innovative decisions is not only for those with management.
  - Theory x assumes lower-order needs dominate individuals
  - Theory y assumes that higher-order needs dominate individuals
- Two-Factor Theory
  - Also known as the 'motivation hygiene theory'
    - Hygiene factors
      - Conditions surrounding the job -- pay, relations with others, quality of supervision, etc.
Contemporary Theories of Motivation
- McClelland's Theory of Needs -- focuses on 3 needs
  - Need for achievement
  - Need for power
  - Need for affiliation
- Cognitive evaluation theory
  - Proposes that the introduction of extrinsic rewards, such as pay, for work that is internally rewarding, tends to decrease overall motivation.
    - When extrinsic rewards are given to someone for performing an interesting task, it causes intrinsic interest in the task itself to decline.
    - Verbal rewards increase intrinsic motivation, whereas tangible rewards undermine it.
- Goal-setting theory
  - Specific goals produce a higher level of output than does the generalized goal of "do your best."
  - Why are people more motivated by goals?
    - We're not distracted
    - We have to work harder to attain them
    - When it's difficult people persist in striving to attain them
    - Difficult goals help us to discover strategies to help us do the job better.
- Management by objectives
  - Emphasizes participatively setting goals that are tangible, verifiable, and measurable.
  - Four common ingredients to MBO programs
    - Goal specificity
    - Participation in decision making
    - An explicit time period
    - Performance feedback
- Self-efficacy Theory
  - Refers to an individual's belief that he or she is capable of performing a task.
  - The goal setting theory and the self-efficacy theory don't compete with each other, they complement each other.
  - Self-efficacy can be increased in four ways
    - Enactive mastery
    - Vicarious modeling
    - Verbal persuasion
    - Arousal
- Equity Theory
  - Proposes that the comparisons between what we put into our jobs and what we get out of them can affect motivation.
    - People compare the job inputs and outcomes to those of others.
    - Four referent comparisons
      - Self-inside
      - Self-outside
      - Other-inside
      - Other-outside
  - Four moderating variables
    - Gender
    - Length of tenure
    - Level in the organization
    - Amount of education or professionalism
  - Distributive justice -- the employee's perceived fairness of the amount and allocation of rewards among individuals.
  - Organizational justice -- an overall perception of what is fair in the workplace
  - Procedural justice -- the perceived fairness of the process used to determine the distribution of rewards.
    - Two key elements of procedural justice
      - Process control -- you can present one's point of view about desired outcomes
      - Explanations -- clear reasons given to a person by management for the outcome
  - To promote fairness in the workplace, managers should consider openly sharing information on how allocation decisions are made
- Expectancy theory
  - Employees will be motivated to exert a high level of effort when they believe:
    - Effort will lead to a good performance appraisal
    - A good appraisal will lead to organizational rewards, such as bonus, promotion, etc.
    - The rewards will satisfy the employees' personal goals
  - Helps to explain why a lot of workers aren't motivated on their jobs and do only the minimum necessary to get by.
  - Some managers incorrectly assume that all employees want the same thing, thus overlooking the motivational effects of differentiating rewards.

Marketing Ch.4

2009-09-11T12:44:00.001-07:00

Objective 1 :Explain the importance of information in gaining insights about the marketplace and customers
- Customer insights
Objective 2: Define the marketing information system and discuss its parts
- Marketing information system
- Internal databases
- Marketing intelligence
Objective 3: Outline the steps in the marketing research process
- The steps
  - Defining the problem and research objectives
  - Developing the research plan for collecting and analyzing the data
  - Interpreting and reporting the findings
- Key terms
  - Marketing research
  - Exploratory research
  - Descriptive research
  - Causal research
  - Secondary data
  - Primary data
  - Commercial online databases
  - Observational research
  - Ethnographic research
  - Survey research
  - Experimental research
  - Focus group interviewing
  - Online marketing research
  - Online focus groups
  - Sample
Objective 4: Explain how companies analyze and use marketing information
- Customer relationship management
Objective 5: Discuss the special issues some marketing researchers face, including public policy and ethics issues

Ethics Ch.4

2009-09-11T11:19:00.001-07:00

Consequentialist Theories
- Focus attention on the results or consequences of the decision or action
- Utilitarianism:
  - Identifies the alternative actions of their consequences for all stakeholders
  - The most ethical decision maximizes benefits and minimizes harm to society
  - "the best for the greater good"
Deontological Theories
- "Duty"
- Base their decisions about what's right on broad, abstract universal ethical principles or values such as honesty, promise keeping, fairness, loyalty, rights, justice, compassion, and respect for person and property
- Certain moral principles are binding, regardless of the consequences.
- Some actions would be considered wrong even if the consequences of the actions were good
- Focuses on doing what is "right"
- Some rely on Western biblical tradition or moral intuition for guidance
  - The "Golden Rule"
- A practical Deontological question to ask "What kind of world would this be if everyone behaved this way or made this kind of decision in this type of situation?
Virtue Ethics
- Focuses on the integrity of the moral actor than on the moral act itself
- A virtue ethics perspective considers primarily the actor's character, motivations, and intentions
Eight Steps to Sound Ethical Decision Making in Business

Gather the Facts
Define the Ethical Issues
Identify the Affected Parties (the Stakeholders)
Identify the Consequences
1. Long-Term vs Short-Term
2. Symbolic Consequences
3. Consequences of Secrecy
Identify the Obligations
Consider Your Character and Integrity
1. The Disclosure rule: Would you be okay if it was published in the NY times
Think Creatively about Potential Actions
Check your Gut

Practical Preventative Medicine
- Read your company's code of ethics
- Ask questions
- Develop relationships with people who are outside of our chain of command

ORBG Ch. 4

2009-09-10T10:42:00.001-07:00

Explain how two people can see the same thing and interpret it differently
- Perception
List the three determinates of attribution
1 Distinctiveness
- Refers to whether an individual displays different behaviors in different situations
2 Consensus
- If everyone who faces a similar situation responds in the same way
3 Consistency
- Does the person respond the same way over time?
- Attribution Theory
  - Suggest that when we observe an individual's behavior, we attempt to determine whether it was internally of externally caused
Describe how shortcuts can assist in or distort our judgment of others
- Selective Perception
- Halo Effect
- Contrast Effects
- Projection
- Stereotyping
Explain how perception affects the decision-making process
Outline the six steps in the rational decision-making model
- Defining the problem
- Identify the decision criteria
- Allocate weights to the criteria
- Develop the alternatives
- Evaluate the alternatives
- Select the best alternative
Describe the actions of the boundedly rational decision maker
List and explain the common decision biases or errors
- Overconfidence Bias
- Anchoring Bias
- Confirmation Bias
- Availability Bias
- Representative Bias
- Escalation of Commitment
- Randomness Error
- Hindsight Bias
Identify the conditions in which individuals are most likely to use intuition in decision making
- When a high level of uncertainty exists
- When there is little precedent to draw on
- When variable are less scientifically predictable
- When "facts" are limited
- When facts don't clearly point the way
- When analytical data are of little use
- When there are several plausible alternative solutions from which to choose, which good arguments for each
- When time is limited and there is pressure to come up with the right decision
Contrast the three ethical decision criteria
- Utilitarian
  - Decisions are made solely on the basis of their outcomes or consequences
  - Provide the greatest good for the greatest number
  - Consistent with efficiency, productivity and high profits
- Rights
  - Calls on individuals to make decision consistent with fundamental liberties and privileges as set forth in documents such as the Bill of Rights
  - Protects whistle-blowers
- Justice
  - Requires individuals to impose and enforce rules fairly and impartially so that an equitable distribution of benefits and cost results

Marketing Ch.2

2009-09-09T11:04:00.001-07:00

Objective 1: Explain companywide strategic planning and its four steps
- Strategic planning
  1. Defining the company's mission
  2. Setting objective and goals
  3. Designing a business portfolio
  4. Developing functional plans
- Mission statement
  - A statement of the organization's purpose-what it wants to accomplish in the larger environment
Objective 2: Discuss how to design business portfolios and develop growth strategies
- Business portfolio
  - The collection of businesses and products that make up the company
- Portfolio analysis
  - The process by which management evaluates the products and businesses that make up the company
- Growth-share matrix
  - Stars
    - High growth, high share businesses or products
  - Cash cows
    - Low growth, high share businesses or products. Produce a lot of cash
  - Question marks
    - Low share business units in high growth markets
  - Dogs
    - Low growth, low share businesses and products
- Product/market expansion grid
  - Market penetration
    - A strategy for company growth by increasing sales of current products to current market segment without changing the product
  - Market development
    - A strategy for company growth by identifying and developing new market segments for current company products
  - Product development
    - A strategy for company growth by offering modified or new products to current market segments
  - Diversification
    - A strategy for company growth through starting up or acquiring businesses outside the company's current products and markets
- Downsizing
  - Reducing the business portfolio by eliminating products of business units that are not profitable or that no longer fit the company's overall strategy
Objective 3: Explain marketing's role in strategic planning and how marketing works wit hits partners to crate and deliver customer value
- Value chain
  - The series of departments that carry out value-creating activities to design, produce, market, deliver, and support a firm's products
- Value delivery network
  - The network made up of the company, suppliers, distributors, and, ultimately, customers who "partner" with each other to improve the performance of the entire system
Objective 4: Describe the elements of a customers driven marketing strategy and mix, and the forces that influence it
- Marketing strategy
- Market segmentation
- Market segment
- Market targeting
- Positioning
- Differentiation
- The Four P's of Marketing mix
  - Product
    - Variety
    - Quality
    - Design
    - Features
    - Brand name
    - Packaging
    - Services
  - Promotion
    - Advertising
    - Personal Selling
    - Sales promotion
    - Public relations
  - Price
    - List price
    - Discounts
    - Allowances
    - Payment period
    - Credit terms
  - Place
    - Channels
    - Coverage
    - Assortments
    - Locations
    - Inventory
    - Transportation
    - Logistics
- The Buyers view "the Four C's"
  - Customer solution (Product)
  - Customer cost (Price)
  - Convenience (Place)
  - Communication (Promotion)
Objective 5: List the marketing management functions, including the elements of a marketing plan, and discuss the importance of measuring and managing return on marketing investment
- SWOT analysis
  - Strengths
    - Internal capabilities that may help a company reach its objectives
  - Weaknesses
    - Internal limitations that may interfere with a company's ability to achieve its objectives
  - Opportunities
    - External factors that the company may be able to exploit to its advantage
  - Threats
    - Current and emerging external factors that may challenge the company's performance
- Marketing implementation
  - The process that turns marketing strategies and plans into marketing actions in order to accomplish strategic marketing objectives
- Marketing control
  - The process of measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure that objectives are achieved
- Return on marketing investment
- Marketing plan
  - Executive summary
  - Current marketing situation
  - Threats and opportunities
  - Objective s and issues
  - Marketing strategies
  - Action programs
  - Budgets
  - Controls

Ethics: Chapter 2 (23-38)

2009-09-08T18:50:00.001-07:00

Why be Ethical?
- Organizations must care about ethics because workers depend on them to help define the boundaries of acceptable and unacceptable behavior.
- We live in a world community and we're all connected to each other -- our future depends on our caring enough.
The Motivation to be Ethical
- Behavioral economists say that people are not only less rational than classical economists assumed but moral. There is evidence that people act for altruistic or moral purposes that seem to have little to do with cost/benefit analyses.
- "The Moral Dimension"
  - Human action has two distinct sources:
    - The pursuit of self-interest
    - Moral commitments
  - People are motivated by both economic and moral concerns
- As human beings and members of society, all of us are hardwired with a moral and ethical dimension as well as self-interested concerns.
The Media Focus on Ethics and Corporate Reputation
- Can the media really influence an organization's image? Yes.
- The most admired companies have great leaders and outstanding employee relations, and they stayed out of legal and ethical trouble
Industries care about ethics
Executive Leaders care about ethics
- Former chairman of IBM said:
  - There is no escaping this fact: the greater the measure of mutual trust and confidence in the ethics of a society, the greater its economic strength.
- Robert D. Haas -- chairman of Levi Strauss
  - The hard stuff (selling pants) and the soft stuff (company's commitment to workforce) are becoming increasingly intertwined.
- Joe Paterno
  - We're in it for the long-run. You can cut corners but it won't pay off in the long-run.
Managers care about ethics
- Many employees perceive the message to be that all that matters is reaching objectives and not how you get there. Today's managers have to work extra hard to communicate the idea that ethical conduct is expected, even in the midst of competition.
Employees care about ethics: Employee attraction and commitment
- Employees are more attracted to ethical organizations.
  - This makes employees more loyal and dependable, and even more inspired.
- Workers translate the ethics of the company into how they're personally treated.
- 94% of Harvard MBA students said they would be willing to forgo financial benefits to work for an organization with a better reputation for ethics and corporate social responsibility.
Individuals care about ethics: reputation counts
- Success depends on one's ability to work effectively with others and trust greases the wheels of working relationships with peers.
Does Society Care? Business and Social Responsibility
- Corporate Social Responsibility has four kinds of responsibility that must be considered simultaneously:
  - Economic, legal, ethical, and philanthropic
Economic Responsibilities
- The economic responsibility refers to a business's primary function as a producer of goods and services that consumers need and want, while making an acceptable profit.
Legal Responsibilities
- Business is expected to carry out its work in accordance with the law and government regulations.
Ethical Responsibilities
- These are the responsibility to do what's right and avoid harm.
Philanthropic Responsibilities
- These responsibilities engage the corporation's participation in activities that promote human welfare or goodwill.
  - Donations of time and money, etc.
- Trump said "in business you must give something back" and "giving is its own reward"

Ethics Ch. 2 (23-38)

2009-09-08T09:01:00.001-07:00

Why Be Ethical? (Why Bother? Who Cares?)
- Industries care about ethics
- Executive leaders care about ethics
- Managers care about ethics
- Employees care about ethics: employee attraction and commitment
- Individuals care about ethics: Reputation counts
- Does society care? Business and social responsibility
  - Economic responsibilities
  - Legal responsibilities
  - Ethical responsibilities
  - Philanthropic responsibilities

ORGB Ch.3

2009-09-07T11:28:00.001-07:00

Factors that determine an individual's personality
- Personality
  - The sum total of ways in which an individual reacts to and interacts with others. It is most often decribed in terms of measurable traits that a person exhibits
Myers-Briggs personality framework
- Extroverted Vs Introverted
  - Extroverted individuals are outgoing, sociable, and assertive. Introverts are quiet and shy
- Sensing Vs Intuitive
  - Sensing types are practical and prefer routines and order. They focus on details. Intuitives rely on unconscious processes and look at the big picture
- Thinking Vs Feeling
  - Thinking types use reason and logic to handle problems. Feeling types rely on their personal values and emotions
- Judging Vs Perceiving
  - Judging types want control and prefer their world to be ordered and structured. Perceiving types are flexible and spontaneous
Big Five Personality Model
- Extroversion
- Agreeableness
- Conscientiousness
- Emotional stability
- Openness to experience
How major personality attributes predict behavior at work
- Extroversion
  - Predicted performance in managerial and sales positions
- Openness to experience
  - Was found to be important in predicting training proficiency
  - More creative in science and in art, less religious and more likely to be politically liberal
  - Cope better wit organizational change and are more adaptable in changing contexts
- Extroverts tend to be happier in their jobs and in their lives as a whole
  - Appear to be more impulsive, are more likely to be absent from work and engage in risky behavior
- Agreeable people
  - Happier that disagreeable people
- Conscientious people
  - Tend to live longer
  - Don't adapt as well to changing contexts
  - Generally performance oriented
  - More trouble than less conscientious people learning complex skills early on
- Emotional Stability
  - Most strongly related to life satisfaction, job satisfaction, and low stress levels
  - Fewer health complaints
- Major Personality Attributes Influencing OB
  - Core self-evaluation
  - Machiavellianism
  - Narcissism
  - Self-monitoring
  - Risk taking
  - Type A and proactive personalities
Terminal and Instrument values
- Terminal values
  - Desirable end-states
- Instrumental values
  - Preferable modes of behavior, or means of achieving the terminal values
Dominant values in today's workforce
- GenX: Team-oriented, focus on work/life balance, dislikes rules
- Gen Y:Confident, self-reliant but team-oriented
- Baby Boomers: Success-oriented, ambitious, dislikes authority
- Veterans: Hard working, conservative, conforming
Hofstede's five value dimensions
- High Power Distance Vs Low Power Distance
- Individualism Vs Collectivism
- Masculinity Vs Femininity
- Uncertainty Avoidance
- Long-term Orientations Vs Short-term Orientation

Marketing: Day 2

2009-09-04T14:30:00.001-07:00

Presentations:

IPOD: promotion -- huge success
ZUPAS: stamp cards but at a given time you can get them stamped…
Wii Marketing: -- to the middle age woman -- promotion, etc. Huge success

Class Lecture:

Marketing is about finding what your customer loves and using that.

5 elements of any strategy
- Target, Product, place, price, promotion
Customer Driven Marketing Strategy
- Production Concept
  - Sears catalog. This is the product. We're the only ones who have it.
- Product Concept
  - Here's the product, here's the price.
- Selling Concept
  - Sell, sell, sell,
  - Example would be the church almost.. We get out there and knock doors, etc.
  - Profits on this come from volume -- late-night ads, etc.
- Marketing concept
  - The smart way to do things -- more customer driven.
4 Ps of Marketing
- Product: design, attributes, materials
- Price: high, low, volume, bundle
- Place: retail, web, professional sales
- Promotion: advertising, personal selling, sales promotions, events, public relations, etc.

Marketing: Chapter 1

2009-09-03T16:10:00.001-07:00

What is marketing?
Satisfying customer needs.
The aim of marketing is to make selling unnecessary.
The process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return
The marketing Process
Understand the marketplace and customer wants and needs
Design a customer-driven marketing strategy
Construct an integrated marketing program that delivers superior value
Build profitable relationships and create customer delight
Capture value from customers to create profits and customer equity

Understanding the Marketplace and Customer Needs:

Customer needs, wants, and demands
Human needs are states of felt deprivation
Physical needs
Individual needs
Wants
The form human needs take as they are shaped by culture and personality
Demands
Wants that are backed by buying power

Marketing offerings - Products, Services, and Experiences

Consumer's needs are fulfilled through market offerings -- a combination of products, services, information, or experiences which are offered to satisfy a want or need.

Market offerings also include persons, places, organizations, information and ideas.

Marketing myopia -- people that are so taken by products that they focus only on existing wants and lose sight of underlying customer needs.

A product is only a tool to solve a consumer problem

Customer Value and Satisfaction

Customers form expectations about the value and satisfaction that they are delivered and buy accordingly

Managers must set the right level of expectations. Not too low cause doesn't attract enough buyers, not too high cause buyers will be disappointed.

Exchanges and Relationships

Exchange -- the act of obtaining a desired object from someone by offering something in return.

Beyond attracting new customers, the goal is to retain customers and grow their business

Markets

Market: the set of all actual and potential buyers of a product or service

Designing a Customer-Driven Marketing Strategy

Marketing management: the art and science of choosing target markets and building profitable relationships with them.

Simply put it is customer management and demand management

Selecting customers to Serve

Divide the market into segments and select which segments it goes after.

The company only wants to select customers that it can serve well and profitably.

Choosing a Value Proposition

Value proposition is the set of benefits or values it promise to deliver to consumers to satisfy their needs.

Marketing Management Orientations

5 alternative concepts under which organizations design and carry out their marketing strategies:

Production Concept: the idea that consumers will favor products that are available and highly affordable and that the organization should therefore focus on improving production and distribution efficiency.

Product concept: the idea that consumers will favor products that offer the most quality performance, and features and that the organization should therefore devote its energy to making continuous product improvements.

Selling concept: The idea that consumers will not buy enough of the firm's products unless it undertakes a large-scale selling and promotion effort

Marketing concept: The marketing management philosophy that holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do.

Societal marketing concept: the idea that a company's marketing decisions should consider consumers' wants, the company's requirements, consumers' long-run interests, and society's long-run interests.

Preparing an Integrated Marketing Plan and Program

The integrated marketing plan consists of the firm's marketing mix, the set of tools the firm uses to implement its marketing strategy.

Building Customer Relationships:

The first three steps (understanding the marketplace, designing a customer-driven strategy, and constructing marketing programs) all lead up to the fourth and most important step: building profitable customer relationships.

Customer Relationships Management

The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.

Relationship Building Blocks: Customer Value and Satisfaction

Customer-perceived value:

the customer's evaluation of the difference between all the benefits and all the costs of a marketing offer relative to those of competing offers. (Gap vs. Old Navy jeans)

Customer satisfaction: the extent to which a product's perceived performance matches a buyer's expectations.

The purpose of marketing is to generate customer value profitably. A company can always increase customer satisfaction by lowering its price or increasing services but this may result in lower profits. Don't give away the house!

Customer relationship levels and tools

Basic relationships: don't get to know the customer's individually, but build brand value, sales promotions, etc.

Full partnerships: use with key customers -- work closely with them

Rewards programs -- gas cards, maverik rewards etc.

The Changing Nature of Customer Relationships

Relating with more carefully selected customers

Selective relationship management: targeting fewer, more profitable, customers.

Relating more deeply and interactively

Partly because of the communications environment, relationships are deeper today

The goal is to get deeper consumer involvement and a sense of community around a brand.

These new communications abilities also give consumers greater power and control.

Consumer-generated marketing: marketing messages, ads, and other brand exchanges created by consumers themselves -- both invited and uninvited.

Partner Relationship Management

Partner relationship Management: working closely with partners in other company departments and outside the company to jointly bring greater value to customers

Partners inside the company

"marketing is far too important to be left to only the marketing department"

Firms are linking all departments in the cause of creating customer value.

Marketing partners outside the firm

Supply chain management

Capturing Value from Customers

Creating Customer Loyalty and Retention

Customer lifetime value: the value of the entire stream of purchases that the customer would make over a lifetime of patronage.

You don't want to lose a customer cause you lose an entire customer lifetime value.

Growing Share of Customer

Share of customer: The portion of the customer's purchasing that a company gets in its product categories.

To do this a firm can increase the variety of products or set up a program to cross sell.

Building Customer Equity

What is customer equity?

Customer equity: the total combined customer lifetime values of all of the company's customers.

Building the right relationships with the right customers

Not all customers, not even all loyal customers, are good investments

Butterflies: potentially profitable but not loyal. We can enjoy them for a little while and then they're gone.

True friends: both profitable and loyal. Firm wants to make great efforts to nurture, retain, and grow business with them.

Barnacles: highly loyal but not very profitable. Ex: smaller bank customers who bank regularly but don't generate enough returns to cover the costs of maintaining the accounts.

The Changing Marketing Landscape

The Digital Age

Web videoconferencing, advertising, internet, etc.

Online marketing is now the fastest-growing form of marketing.

Rapid Globalization

Americans compete with Koreans, etc.

Companies aren't only selling more internationally but are buying more internationally also.

The Call for More Ethics and Social Responsibility

Set themselves apart by being civic-minded and responsible. Use mission statements, etc.

The Growth of Not-For-Profit Marketing

So What is Marketing? Pulling it all Together

The most important part of the marketing process is building value-laden, profitable relationships with target customers.

Ethics: Ch.1

2009-09-03T15:59:00.001-07:00

Ethics: behavior that is consistent with the principles, norms, and standards of business practice that have been agreed upon by society
We believe that education institutions and work organizations should teach people about ethics and guide them in an ethical direction. Adults are op to, and generally welcome, this type of guidance. Ethical problems are not caused entirely by bad apples. They're also the product of
bad barrels- organizational systems that either encourage unethical behavior or merely allow it to occur. Making ethical decisions in today's complex organizations isn't easy. Good intentions and a good upbringing aren't enough. The special knowledge and skill required to make good ethical decisions in a particular job and organizational setting may be different from what's needed to resolve personal ethical dilemmas, and this knowledge and skill must be taught and cultivated.
The ethical decision-making process
- Moral awareness
  - Recognizing the existence of an ethical dilemma
- Moral judgment
  - Deciding what's right
- Ethical behavior
  - Taking action to do the right thing
- Influenced by two types of factors
  - Characteristics of individuals
    - Individual Differences
    - Cognitive biases
  - Characteristics of organizations
    - Group and organizational pressures
    - Organizational culture