Management Flashcards
UK Chartered Institute of Marketing Definition
The process of identifying, anticipating and satisfying customer requirements profitably
Marketing Focus
Strategy
Determine Offer
Match offer to market place
Create long term satisfaction
Sales Focus
Tactics
How to sell to customer
Customer Management
Induce customer satisfaction
Business/Corporate Strategy
How to compete
Where to compete
Strategy
A set of objectives and a plan to attain them
Direct Interaction Definition
Gronroos 2014
Refers to the actors actions which are merged into a collaborative, dialogical process
Project Definition
Turner / Miller 2003
A temporary organisation of resources aiming to achieve a specific goal
Typology of Value
Economic Value - Efficiency / quality
Social - Status / reputation
Hedonic - Fun / Aesthetic
Altruistic - Ethics (fairtrade) / Faith (spirituality)
Value Co-Creation Definition
Gronroos et al 2013
Where two or more actors such as a customer and provider create value in a direct interaction and through a joint process
Standards
De Jure - Set by government enforced by law
De Facto - Set by the market
Committee - Private clubs or industry association
How to deal with standard war
Need to establish tech as industry standard
Control over users - IPR, ability to innovate
Brand name / reputation
Pricing Definition
The process of determining what a company will receive in exchange for its product / service
Cost plus Pricing
Cost to create plus a pre determined mark up
Demand Based Pricing
In accordance to how much a customer is willing to pay
Geographical Pricing
Basis of a customers location
Competitor Based Pricing
Set price based on competitor price
Value Based Pricing
Based on the value the customer perceives it to be
Negotiated Pricing
According to specific agreements between company and the customer / client
Premium Pricing
High end anchoring to elevate / maximise profit
Customised Pricing
In line with customer intimacy
Optional Pricing
Encourage upselling
Introductory Pricing
Price high to recoup sunk costs like R&D
Retail / Asset sale
Customers purchase by paying once
Transaction revenue
Consulting
Daily rates / fixed fees
Usage Fees
Lending / renting / leasing
Licensing
Fee Plus Royalty
Marketing Channel Management
A process to develop various marketing techniques and sales strategies for widest possible customer base
Economics - Mngm resource/costs achieve target return
Courage - Optimise brand exposure/availability/access
Control - Balance all mix within target cost/sale
Kraljic’s Matrix
Maximise Supply Security / reduce cost
Making most of purchasing powr
Procurement impact on final results vs Supply risk
Kraljic’s Matrix
Low / Low
Normal Items
Purchasing criteria - Functional efficiency
Supply - Local Supplier
Items Purchased - Mainly Commodities some specialised
Kraljic’s Matrix
Low Supply / High
Leverage Items
Purchasing criteria - Cost / Price
Supply - Multiple suppliers
Items Purchased - Commodities or specialised
Kraljic’s Matrix
High / High
Strategic Items
Purchasing criteria - Long term availability
Supply - Global suppliers
Items Purchased - Scare / High Value
Kraljic’s Matrix
High Supply / Low
Bottleneck Items
Purchasing criteria - Cost Mngm / Reliable Sourcing
Supply - New with new technology
Items Purchased - Specialised materials
Industrial Property
Patents - Rights of the inventor
Trademarks - Protect trade name / logo
Industrial Designs - Shape, configuration, appearance
Copyright
Protection to ‘creators of works of the mind’
Ethics Definition
The code of moral principles / values that governs behaviour with whats right and wrong
CSR Definition
Daft 2010
The obligation of organisations management to make decisions and take actions that will enhance the welfare and interests of society as well as the organisation
Exclusionary Rights
Patents / Copyrights
Right to prevent usage by others, but have to disclose to solve asymmetric information problem
IPR Covering and Lifespan
Utility Patents - Machines/manu product/processes 20y
Copyright - Original works or authorship Life + 70y
Trademark - Sign / design / expression While maintained
Design Patents - Decorative ornamentation 15y
Plant protect - Discovered/asexually produced plants 20y
Copyright Definition / Detail
Orig works of authorship in any tangible means of express
Literature, Dance, Music and Films
Protection is automatic Life + 70y
Breadth set by comprehensive non literal similarity
Trademarks Definition / Detail
Identify the provenance of a good / service Sign / Symbol / Word / Phrase Duration while maintained Help distinguish goods / services Logos induce trust
Shared Value
Advancing competitivness of company and the economic / social condition of the communities it operated in
Joint value creation integral to competition
CSR Types
Legal approach - Satisfy legal requirements
Market approach - Respond to customers
Stakeholder approach - Address 1+ stakeholder concern
Activist approach - Actively conserve environment
Trade Secrets Definition / Detail
Economic value by not being readily known / accessible / attainable
Not publicly known
Owner taken reasonable precautions to keep it a secret
Not technically property rights
Legal protection if prove it acquired by improper means
Patent Definition / Detail
A legal document giving holder monopoly right to exploit commercially for 20y subject to regular renewal fees
High use in manufacturing / pharmaceuticals
Granted by nation with jurisdiction varying. US largest
First Movers
First entrants to sell the new product / service
Fast Followers
Early but not first entrants
Late Entrants
Wait until product penetrates mass market
First Mover Adv / Disadv
Temporary monopoly / brand loyalty
High R&D
High Market / tech uncertainty
Methods of Strategic Development
Internal - Build / develop org capability / org growth
Merger - Takeover / ownership of another organisation
Strategic Alliance - 2+ orgs share resources/activities
Corporate Strategy in Mergers/Acquisitions
Industry / Market Same / Same - Consolidation Same / New - Conglomerate New / Same - Horizontal integration New / New - Vertical Integration
Vertical
Backward - input activities
Forward - Output activities
Horizontal Integration
Develop into complementary activities
Exploit strategic capability in new market
Motives for Strategies
Environment - Fit to changing business envir
Capability - Stretch/exploit org resources / competances
Expectation - Expectation cultural / political context
Why Diversify
Efficiency gains
Apply Corp Manager capability to new market/product
Increase market power from diverse product range
Spread risk across the business
BCG Matrix
Market Share / Market Growth High / High - Star High / Low - Cash Cow Low / High - Question Mark Low / Low - Dog
Diversification Definition
A strategy that takes an organisation into new markets, products or services
Ansoff’s Matrix
Market / Product New / New - Diversification New / Old - Market Development Old / New - Product Development Old / Old - Market Penetration
No Frills
Low price or benefit
Price sensitive customers
High buyer power
Low Price
Lower price than competitors
Similar product/service benefits
Low cost in ways competi can’t match give sustain adva
Hybrid
Hybrid of Differentiation + Low Price than competitors
Achieve greater volumes
Basis of Competitive Advantage
How to achieve best value or gain competitive advantage
Porters Generic Strategy
Market / Source of Advantage
Broad / Low Cost - Lost Leadership
Broad / Differentiation - Differentiation
Narrow / Low Cost - Cost Focus
Narrow / Differentiation - Differentiation Focus
Strategic Clock
Perceived Benefits / Price No Frills Low Price Hybrid Differentiation Focussed Differentiation Risky High Margins Monopoly Pricing Loss of Market Share
Strategic Clock Failure
Risky high margins
Monopoly pricing
Loss of market share
Differentiation
Offer different benefits
Valued by buyers
Need to identify what their customers value
Know competitors
Narrow - Focussed
Wide - Address differentiation valued by customers
Failure Strategies
Increase Price without increasing benefit
Reduce Benefit and maintain price
Focussed
High perceived product benefits to market segment
Premium Heavily branded
Market Research Process
Define Problem Decide Research Plan Data Collection Data Analysis / Interpretation Write Report and deliver presentation
Break Down Method
Market customers are the same identify groups that share differences
Build Up Method
Market customers are all different, find similarities
Segmenting Consumer Markets
Behaviour - Purchase, consump/usage, media/tech use
Psycholo - Lifestyle, personali, percep, attitude, motives
Profile - Demographic, Socio-economic, Geographic
Cost / Predictability Market Research
Behavioural - High cost/measure High Predictability
Demographic - Low cost/measure Low Predictability
Segment Attractiveness
Market growth / size Segment profitability Competitive intensity Cyclical nature Measured 1-10 (10) Good Low number highly cyclical
Market Research Definition
The collection, collation and analysis of data and information regarding a particular market
Organisational Characteristics
Firmographic - Age, size, lifecycle, industry, type
Economic - Revenue, profit, budget
Geographic - Local, national, multinational, global
Segment Targeting Evaluation
DAMP
Distinct - Is each segment different to others
Accessable - Buyers reached promotion/ deliv channel
Measurable - Easy to identify and measure
Profitable - Large for constant/future reven/profit
Who Profits from innovation
Customers - Most
Imitators
Innovators
Suppliers / Complementors - Least
Segmentation Differentiation
The division of a market into different groups of customers with distinctly similar needs and product / service requirements
Purpose of Market Segmentation
To leverage scarce resources
Parts mrk strat are for particu needs of diff custo groups
Orgs focus on specific custom needs most effe/effi way
SDL Foundation Premise Value Determined
Uniquely/phenomenologically determin by beneficiary
Value is experiential (experience)
Perceived / integrated differently
Uniquely experienced
Job Definition
Is the fundamental problem a customer needs to resolve in a given situation
Customer Acquisition Process
Motive development Info gathering Proposition evalutation Proposition selection Acquisition / Purchase Re-evalutaion
Maslow’s Hierarchy of Needs
Psychological - Basic needs
Safety - Non threatening environment
Belongingness - Affection, attachment, Friendship
Esteem - Valued and well respected
Self actualisation - Need to fulfil a potential
SDL Definition
Vargo and Lusch 2006
The process of using ones resources for the benefit of another entity
Operant / Operand Resources
Resources that act on other resources to create benefit
Resources that need to be acted upon to create benefit
SDL Foundation Premise Value Creation
Value is Co-created by multiple actors
Always includes beneficiary
Actors create value directly / indirectly
Value created following, so inherently relational
SDL Foundation Premise Integrator Creation
All social/economic actors are resource integrators
Integrating resources from various resources
Res intergrat ex/implicit combination value is co created
Relationship Marketing Definition / Idea
Gummesson 1994 Mrking seen as relationships, networks and interactions Customer satisfaction Retention not sales Long term value of customer relationship
Typed of Relationship
Gummessons 30 types of relationship Classic Market Special Market Mega Nano
Marketing Objectives
Create awareness - Company, product, service
Create interest - Offer match customer D engage client
Induce identification - Personal/social identification
Secure new business - Create new needs/deliver wants
Increase Rep - Meet expectation, referrals
Sec Rep Business - Client/serv focus client lifetime value
Increase Profits - Profit margins / market share increases
Drivers of customer Behaviour
Price
Quality
Customer Value
Value - Theory
Holbrook
Preference Experience
Value in use
Value in exchange
Satisfaction from the use of a commodity
Amount of g/s we obtain in exchange of a thing
(Dependant on time and place)
Marketing 7P’s
McCarthy
Product - Design / Manufacture
Place - Delivery Channel
Price - Cost + Profit
Promotion - Advertising / PR
Physical Evidence - Tangible components of service
People - Interaction with customer, how satisfied
Process - Serv del standardised easy to mng expecta
Way of profiting from Innovation
Use in own products
Excluding others from use
Direct profits use by others
Indirect profits from use by others
Suarez / Lanzolla Model Idea
Pace of Market Adoption
Pace of Tech Development
Durability of First Mover Advantage
Suarez / Lanzolla Model Identifiers
Calm Waters - S/S likely to be durable
Market Leads - F/S cannot satisfy D Compet 1/F R&D
Tech Leads - S/F differenti others FM tech shortcomings
Rough Waters - F/F big R&D/mrking campaign survive
Innovation Definition
Michael Porter
A new way of doing things that is commercialised
Why Innovation Matters
William Baumol
All economic growth that has occurred since the 18th century is ultimately attributable to innovation
Life and death matter for the firm
Consumer / Society Benefits of Innovation
New and improved G / S
Reduced cost of existing G / S
Increased private wealth and social care
Longer / Healthier lives
Firm Benefits of Innovation
Market Survival
Higher productivity and higher profits over LT
Provide higher wages / better quality of employment
Higher credit ratings / market value
Innovation Leadership
Firms need to re-invent themselves constantly
Apple Google Samsung Microsoft
Apple Google 3M Toyota
Invention vs Innovation
Creation of a product / intro of process for the first time.
If someone improves / makes significant contribution to an existing product, process or service
Risks in generating innovations
Market - Uncertainty over demand Competitive - What will competitors do Technological - Will it work Organisational - Org changes required Operational - Can it be made / service delivered Financial - Large Upfront investment
Innovation Failure
Do not meet user demand Not differentiated enough Too high a price Late to market Dont comply with regulations Compete with companies other products
Innovation is…
Risky
Very costly
Must happen outside routine business operations
Creative Destruction - CD’s to MP3
5 Types of Innovation
Product vs Process Complement vs Substitute Adjacent vs Cumulative System vs Component Radical vs Incremental
Product vs Process
G/S sold to outsiders / Business inputs to production
Method of produc/design/delivery, red costs incr quality
Substitute vs Complement
Sub - one replace other, value an additive of inputs
Iphone/samsung
Complements - One needs other printer/ink
Adjacent vs Cumulative
Cumu - Build on past
Adj - Putting thing firm does well into something new
System vs Component
Sys - New system new components
Comp - Innovation on part of a system faster CPU
Radical vs Incremental
Incre - Reinforce capability of firm, embedded in firm, stable market/design
Rad - New mrk/opport new domina design may emerge
Struggle to Innovate
Strong culture resist to change
Insufficiently adaptable dont react/see
Organisational inertia
Disruptive Innovation
Disrupts existing market
New features that fringe / new customers value
Cheaper simpler, smaller
Fast improvement in performance
Fluid Phase
Uncertainty about technology
Firms experiment with different product designs
Transitional Phase
Market expands and industry stabilises around a dominant deign
Specific Phase
Firms focus on incremental improvements to the design and manufacturing efficiency
Product Lifecycle
Innovation
Product
R&D
FP - Major product changes, diverse design, focus unspecified
TP - Major process change (rising demand), one design, specific product features
SP - Incremental / Cumulative improvements, undifferentiated, focus on incremental product tech
Product Lifecycle
Costs
Basis of Competition
Innovation Strategy
Fluid - Low, functionality/performance, Performance maximising
Transitional - Medium, Product variation, sales maximise
Specific - High, Price, Cost minimise
Product / Process Innovation
Fluid - Exploration, ncertainty, flexibility
Transitional - Dom design, automation
Specific - Standarisation. Integration
Dominant Design
Where Product and process innovation meet
Establish what is required
Market standard/Industry agreement on attributes
Innovation Survival
From Product to Process From Radical to Incremental Fluid - identify ill-defined customer needs Trans - develop distribution channel Specific - Designing standard product
Product Lifecycle Adv
Helps shape innovation strategy
Assess where they are in the PLC of their industry
Create aware about the pot emerge of dominant design
Product Lifecycle Disadv
Difficult to define boundaries of product / industry
Some sectors don’t follow PLC evolution: services
Product innovations also occur in mature industries: car
