COMM 103 Lecture Notes - Capital Asset, Crop Yield, Customer Retention

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22 Nov 2012
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business management chapter notes 12/09/2012 3:13:00 PM
Chapter 1
An efficient/effective operating platform will possess the 3 following
characteristics against which it can be assessed:
o The market it serves
o Products/services offered
o Needs that must be met in the marketplace
o Reflects comprehension of supply/demand, price/cost
Specialized skills, labour force, “creates value and enables
transactions to occur = profit
Reflective development of infrastructure
Transaction processes developed in order to service the
marketplace targeted
Assets infrastructure and resource base of company (raw materials,
brandpower, etc)
Labour human resource requirements
Capital money needed to support asset based expenditure
Managerial Acumen managerial staffs ability (visionary leadership)
3C Assessment capabilities, competencies, capacity (analyze available
resources = enables management to make decisions
Value Proposition summarizes who a product is geared towards and
benefits the purchaser will receive
Asset based expenditures expenditures you incur in commencing a
business operation/expanding its capacity
Operating expenditures expenses incurred as a result of typical business
S pecific
M easureable Setting objectives which will enable a company to
A ctionable achieve a defined position in the marketplace
C ontrollable
management chapter notes 12/09/2012 3:13:00 PM
Canada uses too much water
Lack of widespread water conservation practices- agriculture recycles less
than 30%
Price of water is significantly less than what it should be
Businesses need to transition from compliance eco management approach
to a sustainable business strategy approach
Sustainability challenge
Climate control- increase climate impact crop yield
Capital squeeze
Resource depletion
Population and health
Energy crunch
Building a reduced-carbon economy
Improving energy efficiency
Decarbonizing the energy supply
Human behaviour modification
Transportation diversity
Factors impacting energy supplies
Poltical impact
Rate of new discoveries
Decline in current production
Current supply development constraints
Cost of capital- intrest rates will increase as the demand for
capital, for investment purposes, exceeds the supply
Financial protectionism-countries with surplus seek to keep their
capital for internal and external investment to provide them with a
competitive edge
Capital Squeeze
Global demand for capital expected to increase
Consequences of massive capital infusion and projected capital
shortfall are as follows:
Access to capital will be difficult (due to low savings rates of citizens
and increasing need of developing economies to use their capital for
internal issues not elsewhere)
Citizens save less, spend more
Cost of capital will increase as demand for capital exceeds supply
Financial protectionism (above)
The END RESULT : “Inability to gain access to needed funds may
result in growth slowing, scarcity of capital my also increase the
gap between rich and poor countries
o Shifting the impact of trade and economic development away from
environmental degradation to a process which exists in an area of
economic sustainability
o To achieve SUCCESS: global market participants must
Agree to pay the social cost (will not work with companies who
refuse to do so
Support and respect pricing policies which reflect the full cost of
expenses incurred in order to achieve environmental sustainability
Block the ability of market players from obtaining and leveraging a
competitive advantage as a result of efforts to avoid environmental
costs (equal playing field”
Eco Efficiency Management
Shifts required to maximize efficiency of our resources ulitization and
minimize/eliminate current degradation
Goal is to create sustainable resource management while still
manufacturing an economically viable product
Long Term Benefits of Environmental Sustainability
Improved corporate image, regulatory compliance BENEFITS
Pricing power
Enhanced efficiencies (greater long term operating efficiencies lead to
high margins, lower cost base = competitive advantage)
Customer retention (loyalty, leverage to increase revenue)
Stronger employee base
Strong environmental management
New business options (new skill development)