Finance Business Partnering

Question 1

Functional Structure in a business:

Answer 1

= traditional

CEO at the top

Underneath on equal level:
- Product development
- Sales and Marketing
- Supply Chain Management
- Finance
- Human Resources

Question 2

Divisional Structure:

Answer 2

More typical in large organisations, operating in multiple regions around the world.

• CEO

Follows by Division A, B and C

Each division has its own:
- Product dev
- sales and marketing
- supply chain mgt
- finance
- HR

Question 3

Matrix organisations:

Answer 3

This is a combination of a functional and a divisional structure:

Each product business area, covers several divisions with their own HR, sales, Pros dev etc

This structure you only see in the largest corporations.

Question 4

The KPIs help dept to achieve the CSFs: 5

Answer 4

• Customer quality ratings
• number of returns
• number of customer complaints about waiting times for delivery
• number of complaints about the quality of a product.
• ## expenditure on customer service training.

Question 5

What are CSFs:

Answer 5

Critical Success Factors

They are the high level, strategic goals of the company:

• how the brand is perceived
• the quality of the product
• level of customer service

Question 6

Good KPIs need to be SMART

Answer 6

Specific
Measurable
Achievable
Relevant
Time-bound

Question 7

What is the Core Product:

Answer 7

• it’s not the tangible product itself, but the benefit that you are buying or the need that is being fulfilled.

Question 8

The Actual Product:

Answer 8

• the tangible product or a service that meets a customers need

Question 9

Augmented product =

Answer 9

The added value. This is a very important element to customers.

For example the warranty and service package includes, when you buy a car.

Question 10

Star v cash cow v dog v question marks

Answer 10

• star = require high investment now in excess of the cash it generates. Promising future.
• cash cow = market leader. These products provide the cash for Stars and Question Marks
• Dogs = these products use up company cash and drain the resources. It’s better for the company to discontinue the product or to find a niche market

Question marks: high rate of market growth, but not yet a large market share. A Problem Child

Question 11

Examples of product management KPIs:

Answer 11

• sales by product over time
• profit by product over time
• market share
• market growth rate
• customer retention
• number of new products launched and time between launches
• product satisfaction ratings
• returns by product

Question 12

How to bring a product to market - marketing and sales process:

Answer 12

1) Understand the market
2) Segment the market; indenting targets
3) Price the product
4) Promote the products
5) Sell the product
6) support and provide service to three customer

Question 13

Penetration Pricing =

Answer 13

Price a new product low, to gain market share quickly.

Question 14

Price skimming:

Answer 14

Price a new product high, to skim off the early adopters, before dropping the price to a lower level.

Question 15

Premium pricing:

Answer 15

Setting a relatively high price to reassure customers that the product is quality.

Question 16

B2G =

Answer 16

Business to Government

Question 17

6 features of People Management:

Answer 17

• Attract
• Educate
• train
  -Motivate
• Empower
• Reward

Question 18

What is forecasting used for in sales and marketing:

Answer 18

To predict future demand and sales figures, using past data, using information we know about the future.

Question 19

What influences forecasts:

Answer 19

• Long-term trends (improvements in technology)
• Seasonal variations
• Cyclical variations (similar to seasonal, but longer than a year.)
• Random variations (impossible to forecast)

Question 20

Methods of forecasting:

Answer 20

• Statistical forecasting:
• Regression analysis
• Time-series analysis
• econometrics

Intuitive forecasting:
- Think-tank (problem with this is group think)
- Delphi technique (consult several experts, who don’t meet. The person who gathers the info from the different experts may add some of their own bias.

Question 21

What are KPIs used for:

Answer 21

To check if objectives have been achieved.

They measure elements which are vital to achieve business success (CSF).

Finance and the other dept can work together to see where improvements can be made.

Question 22

Examples of KPIs for Sales and Marketing dept relating to website and online sales:

Answer 22

• Cost per customer acquisition.
• website traffic to website lead ratio
• social media reach / engagement
• mobile traffic
• sales per visit
• sales response time
• quoted-to-closed ratio
• Organic traffic
• Percentage emails opened by recipient
• form abandonment rate

Question 23

Characteristics of an effective KPI:

Answer 23

• Should be set at strategic level & should flow to management and operational levels.
  To achieve goal congruence.
• Should be challenging, yet achievable.
  
  • So employees will be motivated
  • Not too easy, otherwise employees won’t try to perform over that level.
• Should be under control of employees.
  
  • It’s demotivating if performance evaluation is based on uncontrollable elements.
• Employees must understand KPIs
• KPIs should be SMART
• Should be linked to rewards
  
  • Employees must see value in achieving KPIs
  • Non-performance should trigger training.