COMM 103 Study Guide - Midterm Guide: Corporate Social Responsibility, Capital Asset, Value Proposition

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20 Nov 2012
growth and
strategy and
business plan
business plan
Comm 103 Midterm Exam Review
Shannon Bailey
Chapter 1
An efficient and effective operating platform will possess 3 fundamental
characteristics against which it can be assessed:
1. Commercial endeavours the markets which the organization serves,
the products which it offers, and the needs which it professes to meet in
the marketplace
2. Employee interaction the value-creating skills which an organization’s
employees bring to the marketplace, human resource model
3. Organizational efficiency and structure a reflection of the
complexities of the business activities which circulate within an
Business mission focused activities aimed at identifying the needs of a particular
market(s) and the development of a solution to such needs through the
acquisition/transformation of goods and services that can be delivered to the
marketplace at a profit
-composed of four fundamental resource areas: assets, labour, capital, and
managerial acumen
Managerial acumen the foresight, drive, knowledge, ability, decision-making
competency, and ingenuity of the organization’s key individuals
3 C assessment assess capabilities, competencies, and capacity of a business
Competitive advantage a company possesses this when it can offer customers a
product/service that has more value to them than similar products offered by other
-the failure to meet the objectives of a planning cycle can be the result of poor
positioning, poor operational execution, or a combination of the two
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Not-for-profit organizations those that are not in business to make a profit, but
seek to deliver services to the people, groups and communities which they serve.
They still need a business plan, operating mode and business system so that they
can cover operating costs and fund the delivery of services
Fundamental objectives of business:
Short term profit
Long term growth and profitability
Social and environment responsibility
-too much emphasis on short term profitability may result in decisions which are
detrimental to long term market opportunities and fall short of social responsibility
Profits strictly the bottom line results which an organization has realized for a
given period of time (revenue expenses)
Profitability the efficiency and effectiveness of an organization to use its assets
and its capital to generate profits for the organization over a period of time.
Profitability analysis takes into consideration capital invested, return on equity,
competitors, etc.
Return on sales = profit
Return on assets = profit
Return on equity = profit
Value proposition a statement which summarizes whom a product or service is
geared towards and the benefits which the purchaser of the product/service will
realize as a result of using the product, and differentiates a product from its
competitors. Developed for the purpose of communicating to customers how their
products/services are different and the important benefits which they offer
Value proposition = service benefit + product benefits + brand benefits + cost
benefits + emotional benefits
-in general, the more unique, important, and value-driven your product is, the
greater the opportunity to communicate, to the potential producer, a value
proposition which has a positive price/quantity relationship, and which can be
considered to be superior to those of your competitors
-price of a product may be lower than perceived benefits in quality
4 P’s – product, price, place, promotion
Positioning the ability of an organization to develop a unique, credible,
sustainable place in the minds of customers for its brand, product, and services
-combination of strategy, the match between our offer (value prop) and
target market, and place relative to competitors; communication of price and deliver
Asset based expenditures expenditures which you incur in commencing a
business operation or expanding its capacity
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Operating expenditures expenses incurred as a result of normal business
operations i.e. salaries of employees, costs of shipping and raw materials, etc
-a key component of managing any business is in understanding the expenses which
must be considered when setting the price of a product/service offering
Strategy the development of plans and decisions which will guide the direction of
the firm and determine its long term performance. Focuses on vision and
opportunity for future.
Tactics immediate term actions which a firm executes in order to meet the short
term objectives set forth in the current planning cycle
well directed and positioned strategy + efficient and effective tactics execution =
business growth and profitability
VUGA Volatility, Uncertainty, Globalization, Adverse
-volatility is the variation of price over time, which breeds uncertainty
-forecasting tries to minimize volatility and creates certainty
-globalization contributes to volatility and certainty because of new entrants,
substitute products etc.
-all three together create an adverse environment: we shy away from investment
Chapter 4 The Environment and Sustainable Business Practices
-the goal is to design and redesign business processes in a way which, while
allowing for increased wealth and enhanced competitive advantage, incorporate the
principles of human mankind and resource protection and sustainability for the
The challenges:
1. Climate change
2. Pollution & Health pollution triggered disease i.e. pneumonia, bronchitis &
toxic threats at worksites are a problem
3. The Energy Crunch we are increasing consumption of energy; we must
manage resource depletion and look at alternative sources
visualize and
assess the
market size
approach, and
resources and
determine the
required to
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