Chapter 1: Business processes and marketing concept Flashcards
How is a company defined?
A sociotechnical system that provides goods and services
What does “socio” in sociotechnical mean?
Organisatino of people
What does “technical” mean in sociotechnical?
with certain techniques, know-how and processes behind it
What is the main goal of companies?
They are purpose-oriented and create added value that arises from the difference between their input and output
What is the definition of a benefit?
A good’s ability to satisfy a specific need of the consumer
What is the definition of an object’s value?
The benefit expected to stream from it. (“The expression of a product’s importance for satisfying the subjective needs)
What is the definition of a process or a value added chain?
More complex products or services require more processing stages
Every element of a value chain can be subdivided into individual activities
What is a system?
Set of organized elements with qualities linked by relations
What is a value creation network and a meta-system?
The organisation’s objective is a lasting, stable, efficient and cooperative integration and coordination of the labor services provided
==> This requires a “meta-system” of communication, events, decisions and actions
What are transation costs?
Costs that arise from using the market
There are interfaces, frequently technical transitions, between the individual value-creation stages.
How a value chain is divided between organizations and how extensive the value-creation of a company is, or how much of the value chain it covers, depends mostly on the relationship between transaction and organisation costs.
What is included in the general term “managing”? What is the main task?
Companies but also entire value chains must be organised meaning deliberately shaped.
This is included in the general term “managing”
How does the management cycle look like?
A cycle of preview and planning, organisation, management, coordination followed by controlling.
What is the definition of management?
Reflexive design praxis of value creation system
What is another task of management?
Management must ensure cohesion of the stakeholders (be alligned with their expectations!)
What is the tripple bottom line?
The triple bottom line is a business concept that states that firms should commit to measuring their social and environmental impact in addition to their financial performance.
What are the three pillars of the tripple bottom line?
The three pillars of the triple bottom line are people, planet, and profit.
Tripple bottom line: What does “social” stand for?
Social (people): This pillar focuses on the social impact of a business, including its impact on employees, customers, and the community.
Tripple bottom line: What does “economic” stand for?
Economic (Profit): This pillar focuses on the financial performance of a business, including its revenue, expenses, and profitability.
Tripple bottom line: What does “Natural” stand for?
Natural (Planet): This pillar focuses on the environmental impact of a business, including its use of resources and its impact on the environment.
What are enviornments?
Space of possibilities (opportunities and threats)
A company acts in an environments.
Which contexts are included here?
- Economic context
(supplier relations, demand markets) - social/political context
(local structure, political interests, legal framework resulting from it.)
And the natural context
(natural resources, locaction etc.)
What does the constantly changing environment mean for the company and management?
Since the environment changes constantly, e.g. costumers’ needs, management has to solve a twofold problem: on one hand, it must create a certain value as well and cheaply as possible (effectively and efficiently), which requires standardization and stabilization
On the other, it must constantly react to changes in the environment and remake itself, which requires differentiation and disrupting routines
This often generates conflicts
What are the challanges through changes in its different environmental spheres and stakeholders?
- legal circumstances can alter the resources of a company if properties it owns get desingated for building thorugh a change in zoning and thus become more valuable
- a societal change in values can lower demand for products or even label them as ethically questionable
- globalisation of markets leads to new competitors and a company has to reposition itself
==> corporate management constantly faces new challenges and has to communicate, reflect, convince, stabilize, intervene and make decisions in a stream of events
What are stakeholders? How are they important?
Environment also includes stakeholders
A company can survive only if it is legitimized by all stakeholders and is considered attractive, so that they continue to support the company.
The task of management here is to ensure the cohesion of stakeholders and balance interests
Which stakeholders are there?
State, investors, customer, employees, NGOs, Media, Competitors, suppliers and partners
How is a model defined?
Can be though of as a simplified image of complex reality
Why are management models developed?
Management models are developed to organize those complex relationships, present them neatly and give all actors involved in corporate decision-making an orientation framework.
How is the SGMM defined?
Formal orientation model with the main objective of offering company decision-makers an orientation in their work
What is special about the 4th generation of the SGMM?
In the 4th generation of the SGMM the reflective shaping of collective vallue-creation systems based on the dividion of labor has priority
Which two points are also important in the 4th generation of the SGMM?
- An understanding of company limits is necessary (in the age of flexible outsourcing, because companies nowadays reconfigure themselves along the value chain)
- Maintaining the decision-making ability and the balance between integration and differentiation
Which key categories does the 4th generation model include?
- environment
(possibility space) - organisation
(value-creation system)
management
(reflective shaping practice)
What does the environment focus on?
- stakeholders (intermediate and customer markets)
- and the organisation of the value-creation system with
==> customer processes
==> performance processes
==> and innovation processes
How important are the stakeholders for the existence of the company?
A company can only exist if all of the relevant stakeholders cooperate.
==> They form a primary orientation framework for management and were therefore depicted in the outer circle in several generations of the SGMM.
How are stakeholders defined?
organization-relevant representatives of different environmental spheres or discourses
What can companies offer stakeholders for their continued participation?
In return for their continued participation in the company, management can offer stakeholders the opportunity to share in
- added value
(for exmples wages for employees, interest for investors, membership fees in NGOs, dividends for shareholders, taxes for the state) - the image
(for example if a company contributes to the appeal of a location as a brand) - The continued development of the company and the expertise exchange
(for example if a joint-research center for the industry is run with a competitor)
What are the classic environmental spheres?
- natural environment
- social environment
- economic environment
Are the environments equally important for every company?
No, the environments have varying relevance, according to context and the company’s problem or objective.
A market-oriented management is concerned primarily with the economic environment, especially demand-driven markets and supplier markets.
What is the definitio of sustainable development?
development that meets the needs of the present without compromising the ability of future generations to meet their own needs
==> Characterised by not using more resources that it generates or which can be regenerated
What is the relevance of sustainability of an enterprise?
Sustainability is always, explicitly or implicitrly, the subject and aim of the enterprise.
What does it mean that sustainability is a “intergenerational” concept?
It is about future generations not having less but, ideally, more resources and courses of action available to them
How is sustainability related to the tripple-bottom line?
In terms of a tripple-bottom-line, sustainability is mainly applied to the three main environmental spheres: economy, society and nature.
What is social responsible leadership?
Can be defined as sustainable management with the objective of a balance between the value demands of internal and external stakeholder society.
==> Social responsible leadership (or CSR, corporate social Responsability) meaning responsible acting, presupposes that the effects of a company’s actions on different environmental areas are recognized, assessed in a general way and lead to action consequences.
What are examples for Sustainable development goals (SDGs)?
- no poverty
- zero hunger
- good health and well-being
- quality education
- gender equality
- clean water and sanitation
- affordable and clean energy
- decent work and economic growth
- industry, innovation and infrastructure
- reduced inequalities
- sustainable cities and communities
- responsible consumption and production
- climate action
- life below water
- life on land
- peace, justice and strong institutions
- partnerships for the goals
What are the three horizons of meaning?
Management in the sense of a reflective shaping practice traditionally refers to three horizons of meaning:
- Normative
- Strategic
- And operational
horizons of meaning.
What is normative management concerned with?
Concerns itself with questions of long-term corporate objectives, values and norms that should inform actions in a company and wit the underlying objective, which it is supposed to achieve in society and in the economy
The decision of normative management are often subsumed under a so-called mission statement
What is the objective of a mission statement (normative management)?
Its objective is securing the long-term legitimacy of the enterprise, meaning the relevant stakeholders continue to view it as necessary and useful, so it can stay in business.
Who is responsible for the normative management?
The owner, in the sense of an owner-strategy, or the board of directors is responsible for that.
Who shapes the strategic management? How is it different depending on the country?
Is often shaped at the intersection of the board of directors and the executive board.
But there are differences depending on a country’s corporate governance tradition, in Germany the supervisory boad is traditionally not an organizing body that influences the strategy or takes an active part in discussions ==> a two-tier corporate governance system, where it is mostly the executive board that shapes strategy.
In Switzerland by contrast the board of directors is responsible for company management and thus for strategy (one-tier system) It can delegate tasks to the executive board, but it has clearly defined inalienable responsibilities that include shaping strategy
What is the objective of every corporate strategy?
The preservations of a company’s competitive edge and viability is the objective of every corporate strategy
==> it concentrates on securing and developing profit potentials
Who deals with operational management?
The actors on every level of a company deal with operational management.
Which two perspectives are there i strategic management?
- Potentials can exist in the form of resources (for example core competencies) in the sense of an inside-out perspective
- or in the form of external resources that are exploited in the environment (positive image of a well-established bran) in the sense of an outside-in perspective
What is the objective of operational management?
It s objective is economic viability or securing a sufficient added value.
==> Success and liquidity, or cash flow along with depending on the role, sub-targets such as optimizing stock, are the target indicators of this.
What are important planning tools for operational management?
Important planning tools include budget planning and process management for example, for optimum management of performance or production, as well as marketing plans for the ideal application and the coordination of marketing tools.
