Comm 103. Business Management
The big picture
- Efficient and effective operating platform will also possess three fundamental characteristics
against which it can be asses.
1. Commercial endeavour : to the market which the organization serves the product and
service which it offers and the needs which It professes to meet in the marketplace. If
reflects the results of understanding the demand/supply relationship which exists in the
marketplace and the capacity and capabilities of each of the competitors within such a
market to deliver products/ services to its buyers.
2. Employee interaction : refers to the value-creating skills which an organizations employees
bring to the marketplace. The success of many business lies with the specialized skills which
exist within its labour force.
3. Organization efficiency and structure: a reflection of the complexities of the business
activities which circulate within an organization. It is reflective of the development of the
infrastructure and its related culture, which an organization creates and the transaction
processes which it develops in order to service the marketplace it targets.
Four core fundamental resources areas for building its business model or system
1. Assets: represents the infrastructure and resources base of the organization.
2. Labour: refers to the human resource requirements of the business
3. Capital: refers to the money needed by an organization to support numerous activities
4. Managerial acumen: refers to the foresight, drive, knowledge, ability, decisions making
competency and ingenuity of the organizations key individuals. Key component is the
5 key outcomes to the strategy
- create, revise or confirm the vision
- validate that the market size and direction remains sufficient enough for you to sustain your
- recognize that success of the current planning cycle which has just ended
- identify your opportunities and threats
- identify your 3C strengths and weakness in support of the vision.
1 3C assessment ( capabilities, competencies, capacity)
- 3C analyzes the resources available to the organization and the capabilities and competencies
which it possesses.
- Capacity of what the organization can and cannot do, which then enables the management
team to define how and to what extent it can capitalize on its identified strategic opportunities
in a manner superior to the competitor
Business planning cycle
- Outlines its focus and methodology for using its resources to create valuable products and
services which will create a unique position in the marketplace
- Competitive advantage when it can offer a customer a product/service that has more value to
them than similar products
- Each planning cycle is designed to direct the positioning of the company within the marketplace,
orchestrate the creation of a business plan which will achieve the objectives formulated for the
planning period, develop the required operation tactics which will ensure that the plan is
executed in a fashion which leads to growth and ensure profitability
Business Planning Cycle
performance growh and
Explain the overarching start:
challenge here execution strategy and
2 Planning Cycle Staging
Direction/ position Implantation Assessment
- What do we want to do? - How will we do it? - Did we meet our goal?
- Why do we want to do it? - What needs to be changed in - What needs to be changed or
- Can we do it? order for us to succeed? improved
- Where will resources be - What system requires fine
- What further capacity
adjustments are required.
Fundamental Objectives of Business
short term environmental
Difference Between profit and Profitability
- Profits: are strictly the bottom line results
o Total revenue total expenses = profits
- Profitability: corresponds to theefficiency and effectiveness of an organization to use its
assets and capital togenerate profits for the organization over a period of time.
Return on sales(ros) Return on assets(Roa) Return on equity (roe)
= Profit / sales = profit / assets = profit / equity
3 Value Proposition composition
- Value proposition: is a statement which summarized whom a product or service is geared
towards and the benefits which the purchaser of the product or service will realize as a result of
using the product. Communicates how it is different from competing products or services.
- Strength of the value proposition is the perceived sum of your companys ability to deliver in
each of the areas noted within the value proposition equation, versus the strength of your
competitors value proposition measured across these same benefit areas.
- Value proposition = service benefits + product benefits + brand benefits +
cost benefits + emotional benefits
road to positioning
willingness to ROS strategies type of strategies
pay (margin are required here can we do both
PIMS strategies type of strategies
scale and volume (Market Share) are required here can we do both?