Stakeholder Theory

As originally detailed by R. Edward Freeman (1984), stakeholder theory identifies and models the groups which are stakeholders of a corporation, and both describes and recommends methods by which management can give due regard to the interests of those groups. In short, it attempts to address the "Principle of Who or What Really Counts."

In the traditional view of the firm, the shareholder view (the only one recognized in business law in most countries), the shareholders or stockholders are the owners of the company, and the firm has a binding fiduciary duty to put their needs first, to increase value for them. In older input-output models of the corporation, the firm converts the inputs of investors, employees, and suppliers into usable (salable) outputs which customers buy, thereby returning some capital benefit to the firm. By this model, firms only address the needs and wishes of those four parties: investors, employees, suppliers, and customers. However, stakeholder theory argues that there are other parties involved, including governmental bodies, political groups, trade associations, trade unions, communities, associated corporations, prospective employees, prospective customers, and the public at large. Sometimes even competitors are counted as stakeholders.

The stakeholder view of strategy is an instrumental theory of the corporation, integrating both the resource-based view as well as the market-based view, and adding a socio-political level.

This view of the firm is used to define the specific stakeholders of a corporation (the normative theory (Donaldson) of stakeholder identification) as well as examine the conditions under which these parties should be treated as stakeholders (the descriptive theory of stakeholder salience). These two questions make up the modern treatment of Stakeholder Theory.

==Scholarly Contributions== 45

There have been well over 100 articles and numerous books written on stakeholder theory including an entire issue of the Academy of Management Journal (v 42 n 5, 1999). Recent scholarly works on the topic of stakeholder theory that exemplify research and theorizing in this area include Donaldson and Preston (1995) and Mitchell, Agle, and Wood (1997), Friedman and Miles (2002) and Phillips (2003).

Donaldson and Preston argue that the normative base of the theory, including the "identification of moral or philosophical guidelines for the operation and management of the corporation" (pg. 71), is the core of the theory. Mitchell, et al derive a typology of stakeholders based on the attributes of power (the extent a party has means to impose its will in a relationship), legitimacy (socially accepted and expected structures or behaviors), and urgency (time sensitivity or criticality of the stakeholder's claims). By examining the combination of these attributes in a binary manner, 8 types of stakeholders are derived along with their implications for the organization. Friedman and Miles explore the implications of contentious relationships between stakeholders and organizations by introducing compatible/incompatible interests and necessary/contingent connections as additional attributes with which to examine the configuration of these relationships.

The political philosopher Charles Blattberg has criticized stakeholder theory for assuming that the interests of the various stakeholders can be, at best, compromised or balanced against each other. Blattberg argues that this is a product of its emphasis on negotiation as the chief mode of dialogue for dealing with conflicts between stakeholder interests. He recommends conversation instead and this leads him to defend what he calls a 'patriotic' conception of the corporation as an alternative to that associated with stakeholder theory.

http://en.wikipedia.org/wiki/Stakeholder_theory

Value Chain Analysis

The value chain, also known as value chain analysis, is a concept from business management that was first described and popularized by Michael Porter in his 1985 best-seller, Competitive Advantage: Creating and Sustaining Superior Performance.

A value chain is a chain of activities. Products pass all activities of the chain in order and at each activity the product gains some value. The chain of activities gives the products more added value than the sum of added values of all activities. It is important not to mix the concept of the value chain, with the costs occurring throughout the activities. A diamond cutter can be used as an example of the difference. The cutting activity may have a low cost, but the activity adds to much of the value of the end product, since a rough diamond is a lot less valuable than a cut diamond.

The value chain categorizes the generic value-adding activities of an organization. The "primary activities" include: inbound logistics, operations (production), outbound logistics, marketing and sales, and services (maintenance). The "support activities" include: administrative infrastructure management, human resource management, R&D, and procurement. The costs and value drivers are identified for each value activity. The value chain framework quickly made its way to the forefront of management thought as a powerful analysis tool for strategic planning. Its ultimate goal is to maximize value creation while minimizing costs.

The concept has been extended beyond individual organizations. It can apply to whole supply chains and distribution networks. The delivery of a mix of products and services to the end customer will mobilize different economic factors, each managing its own value chain. The industry wide synchronized interactions of those local value chains create an extended value chain, sometimes global in extent. Porter terms this larger interconnected system of value chains the "value system." A value system includes the value chains of a firm's supplier (and their suppliers all the way back), the firm itself, the firm distribution channels, and the firm's buyers (and presumably extended to the buyers of their products, and so on).

Capturing the value generated along the chain is the new approach taken by many management strategists. For example, a manufacturer might require its parts suppliers to be located nearby its assembly plant to minimize the cost of transportation. By exploiting the upstream and downstream information flowing along the value chain, the firms may try to bypass the intermediaries creating new business models, or in other ways create improvements in its value system.

The Supply-Chain Council, a global trade consortium in operation with over 700 member companies, governmental, academic, and consulting groups participating in the last 10 years, manages the de facto universal reference model for Supply Chain including Planning, Procurement, Manufacturing, Order Management, Logistics, Returns, and Retail; Product and Service Design including Design Planning, Research, Prototyping, Integration, Launch and Revision, and Sales including CRM, Service Support, Sales, and Contract Management which are congruent to the Porter framework. The "SCOR" framework has been adopted by hundreds of companies as well as national entities as a standard for business excellence, and the US DOD has adopted the newly-launched "DCOR" framework for product design as a standard to use for managing their development processes. In addition to process elements, these reference frameworks also maintain a vast database of standard process metrics aligned to the Porter model, as well as a large and constantly researched database of prescriptive universal best practices for process execution.

http://en.wikipedia.org/wiki/Value_chain

Game theory

Game theory is a branch of applied mathematics that is often used in the context of economics. It studies strategic interactions between agents. In strategic games, agents choose strategies that will maximize their return, given the strategies the other agents choose. The essential feature is that it provides a formal modelling approach to social situations in which decision makers interact with other agents. Game theory extends the simpler optimisation approach developed in neoclassical economics.

The field of game theory came into being with the 1944 classic Theory of Games and Economic Behavior by John von Neumann and Oskar Morgenstern. A major center for the development of game theory was RAND Corporation where it helped to define nuclear strategies.

Game theory has played, and continues to play, a large role in the social sciences, and is now also used in many diverse academic fields. Beginning in the 1970s, game theory has been applied to animal behaviour, including evolutionary theory. Many games, especially the prisoner's dilemma, are used to illustrate ideas in political science and ethics. Game theory has recently drawn attention from computer scientists because of its use in artificial intelligence and cybernetics.

In addition to its academic interest, game theory has received attention in popular culture. A Nobel Prize–winning game theorist, John Nash, was the subject of the 1998 biography by Sylvia Nasar and the 2001 film A Beautiful Mind. Game theory was also a theme in the 1983 film WarGames. Several game shows have adopted game theoretic situations, including Friend or Foe? and to some extent Survivor. The character Jack Bristow on the television show Alias is one of the few fictional game theorists in popular culture,[1] along with math professor Charlie Eppes from the show NUMB3RS, who uses Game Theory in many episodes to solve crime.

Although some game theoretic analyses appear similar to decision theory, game theory studies decisions made in an environment in which players interact. In other words, game theory studies choice of optimal behavior when costs and benefits of each option depend upon the choices of other individuals.

The first known discussion of game theory occurred in a letter written by James Waldegrave in 1713. In this letter, Waldegrave provides a minimax mixed strategy solution to a two-person version of the card game le Her. It was not until the publication of Antoine Augustin Cournot's Researches into the Mathematical Principles of the Theory of Wealth in 1838 that a general game theoretic analysis was pursued. In this work Cournot considers a duopoly and presents a solution that is a restricted version of the Nash equilibrium.

Although Cournot's analysis is more general than Waldegrave's, game theory did not really exist as a unique field until John von Neumann published a series of papers in 1928. While the French mathematician Borel did some earlier work on games, Von Neumann can rightfully be credited as the inventor of game theory. Von Neumann was a brilliant mathematician whose work was far-reaching from set theory to his calculations that were key to development of both the Atom and Hydrogen bombs and finally to his work developing computers. Von Neumann's work in game theory culminated in the 1944 book Theory of Games and Economic Behavior by von Neumann and Oskar Morgenstern. This profound work contains the method for finding mutually consistent solutions for two-person zero-sum games. During this time period, work on game theory was primarily focused on cooperative game theory, which analyzes optimal strategies for groups of individuals, presuming that they can enforce agreements between them about proper strategies.

In 1950, the first discussion of the prisoner's dilemma appeared, and an experiment was undertaken on this game at the RAND corporation. Around this same time, John Nash developed a criterion for mutual consistency of players' strategies, known as Nash equilibrium, applicable to a wider variety of games than the criterion proposed by von Neumann and Morgenstern. This equilibrium is sufficiently general, allowing for the analysis of non-cooperative games in addition to cooperative ones.

Game theory experienced a flurry of activity in the 1950s, during which time the concepts of the core, the extensive form game, fictitious play, repeated games, and the Shapley value were developed. In addition, the first applications of Game theory to philosophy and political science occurred during this time.

In 1965, Reinhard Selten introduced his solution concept of subgame perfect equilibria, which further refined the Nash equilibrium (later he would introduce trembling hand perfection as well). In 1967, John Harsanyi developed the concepts of complete information and Bayesian games. Nash, Selten and Harsanyi became Economics Nobel Laureates in 1994 for their contributions to economic game theory.

In the 1970s, game theory was extensively applied in biology, largely as a result of the work of John Maynard Smith and his evolutionary stable strategy. In addition, the concepts of correlated equilibrium, trembling hand perfection, and common knowledge[6] were introduced and analysed.

In 2005, game theorists Thomas Schelling and Robert Aumann followed Nash, Selten and Harsanyi as Nobel Laureates. Schelling worked on dynamic models, early examples of evolutionary game theory. Aumann contributed more to the equilibrium school, introducing an equilibrium coarsening, correlated equilibrium, and developing an extensive formal analysis of the assumption of common knowledge and of its consequences.

In 2007, Roger Myerson, together with Leonid Hurwicz and Eric Maskin, was awarded of the Nobel Prize in Economics "for having laid the foundations of mechanism design theory." Among his contributions, is also the notion of proper equilibrium, and an important graduate text: Game Theory, Analysis of Conflict, published in 1991.

http://en.wikipedia.org/wiki/Game_theory

Real Business Cycle Theory

Real Business Cycle Theory (or RBC Theory) is a macroeconomic school of thought that holds that the business cycle is caused by random fluctuations in productivity. (The four primary economic fluctuations are secular (trend), business cycle, seasonal, and random.) Unlike other leading theories of the business cycle, it sees recessions and periods of economic growth as the efficient response of output to exogenous variables. That is, RBC theorists argue that at any point in time, the level of national output necessarily maximizes utility, and government should therefore not intervene through fiscal or monetary policy designed to offset the effects of a recession or cool down a rapidly growing economy.

According to RBC theory, business cycles are therefore "real" in that they do not represent a failure of markets to clear, but rather reflect the most efficient possible operation of the economy. It differs in this way from other theories of the business cycle, like Keynesian economics and Monetarism, which see recessions as the failure of some market to clear.

Economists have come up with many ideas to answer the above question. The one which currently dominates the academic literature was introduced by Finn Kydland and Edward Prescott in their seminal 1982 work “Time to Build And Aggregate Fluctuations.” They envisioned this factor to be technological shocks i.e., random fluctuations in the productivity level that shifted the constant growth trend up or down. Examples of such shocks include innovations, bad weather, imported oil price increase, stricter environmental and safety regulations, etc. The general gist is that something occurs that directly changes the effectiveness of capital and/or labor. This in turn affects the decisions of workers and firms, who in turn change what they buy and produce and thus eventually affect output. RBC models predict time sequences of allocation for consumption, investment, etc. given these shocks.

But exactly how do these productivity shocks cause ups and downs in economic activity? Let’s consider a good but temporary shock to productivity. This momentarily increases the effectiveness of workers and capital. Also consider a world where individuals produce goods they consume. This may seem silly but at the aggregate level, this averages out.

Individuals face two types of trade offs. One is the consumption-investment decision. Since productivity is higher, people have more output to consume. An individual might choose to consume all of it today. But if he values future consumption, all that extra output might not be worth consuming entirety today. Instead, he may consume some but invest the rest in capital to enhance production in subsequent periods and thus increase future consumption. This explains why investment spending is more volatile than consumption. The life cycle hypothesis argues that households base their consumption decisions on expected lifetime income and so they prefer to “smooth” consumption over time. They will thus save (and invest) in periods of high income and defer consumption of this to periods of low income.

The other decision is the labor-leisure trade off. Higher productivity encourages substitution of current work for future work since workers will earn more per hour today and less tomorrow. More labor and less leisure results in higher output today. More output means greater consumption and investment today. On the other hand, there is an opposing effect: since workers are earning more, they may not want to work as much today and in future periods. However, given the pro-cyclical nature of labor, it seems that the above “substitution effect” dominates this “income effect.”

Overall, the basic RBC model predicts that given a temporary shock, output, consumption, investment and labor all rise above their long-term trends and hence formulate into a positive deviation. Furthermore, since more investment means more capital is available for the future, a short-lived shock may have an impact in the future. That is, above-trend behavior may persist for some time even after the shock disappears. This capital accumulation is often referred to as an internal “propagation mechanism” since it converts shocks without persistence into highly persistent shocks to output.

It is easy to see that a string of such productivity shocks will likely result in a boom. Similarly, recessions follow a string of bad shocks to the economy. If there were no shocks, the economy would just continue following the growth trend with no business cycles.

Essentially this is how the basic RBC model qualitatively explains key business cycle regularities. Yet any good model should also generate business cycles that quantitatively match the stylized facts in Table 1, our empirical benchmark. Kydland and Prescott introduced calibration techniques to do just this. The reason why this theory is so celebrated today is that using this methodology, the model closely mimics many business cycle properties. Yet current RBC models have not fully explained all behavior and neoclassical economists are still searching for better variations.

It is important to note the main assumption in RBC theory is that individuals and firms respond optimally all the time. In other words, if the government came along and forced people to work more or less than they would have otherwise, it would most likely make people unhappy. It follows that business cycles exhibited in an economy are chosen in preference to no business cycles at all. This is not to say that people like to be in a recession. Slumps are preceded by an undesirable productivity shock which constrains the situation. But given these new constraints, people will still achieve the best outcomes possible and markets will react efficiently. So when there is a slump, people are choosing to be in that slump because given the situation, it is the best solution. This suggests laissez-faire is the best type of government intervention but given the abstract nature of the model, this has been debated.

A pre-cursor to RBC theory was developed by monetary economists Milton Friedman and Robert Lucas in the early 1970s. They envisioned the factor that influenced people’s decisions to be misperception of wages -- that booms/recessions occurred when workers perceived wages higher/lower than they really were. This meant they worked and consumed more/less than otherwise. In a world of perfect information, there would be no booms or recessions.

http://en.wikipedia.org/wiki/Real_business_cycle

Merger of Nations Bank and Bank America

Merger of NationsBank and BankAmerica In 1997, BankAmerica lent D.E. Shaw & Co., a large hedge fund, $1.4bn so that the hedge fund would run various businesses for the bank. However, D.E. Shaw suffered significant loss after 1998 Russia bond default. BankAmerica was later acquired by NationsBank that year.

The purchase of BankAmerica Corp. by the NationsBank Corporation was the largest bank acquisition in history at that time. While the deal was technically a purchase of BankAmerica Corporation by NationsBank, the deal was structured as merger with NationsBank renamed to Bank of America Corporation, and Bank of America NT&SA, changing its name to Bank of America, N.A. as the remaining legal bank entity. The bank still operates under Federal Charter 13044 which was granted to Giannini's Bank of Italy on March 1, 1927. However, SEC filings before 1998 are listed under NationsBank, not BankAmerica.

Following the US$64.8 billion acquisition of BankAmerica by NationsBank, the resulting Bank of America had combined assets of US$570 billion, as well as 4,800 branches in 22 states. Despite the mammoth size of the two companies, federal regulators insisted only upon the divestiture of 13 branches in New Mexico, in towns that would be left with only a single bank following the combination. This is because branch divestitures are only required if the combined company will have a larger than 25 percent FDIC deposit market share in a particular state or 10 percent deposit market share overall.

Source:http://en.wikipedia.org/wiki/Bank_of_America

Bank of ItalyThe Roots Of The Pre1998 Bank of America

Bank of ItalyThe roots of the pre-1998 Bank of America lie in the American Bank of Italy, founded in San Francisco by Amadeo Giannini in 1904. When the 1906 San Francisco earthquake struck, Giannini was able to get all of the deposits out of the bank building and away from the fires. Thus, unlike many other banks, he retained the confidence of the depositors and also had money to lend to those struck by the disaster.

In the late 1920s, Giannini approached Orra E. Monnette, President and founder of Bank of America, Los Angeles, about a merger between the two entities. The Los Angeles based bank had exhibited strong growth throughout the 1920s, due in part to its success in developing an advanced branch banking system. The merger was completed in early 1929 and took the name Bank of America. The combined company was headed by Giannini with Monnette serving as co-Chair.

While the names of many nationally chartered banks end with the initials 'N.A.' (National Association), Giannini picked a unique ending, National Trust and Savings Association, or 'NT&SA', because he wanted the name to highlight the different functions of the bank. Bank of America was the only NT&SA in the country. Thanks to good management, but also to aggressive development of the branch banking concept, the bank was soon the largest in California.

Bank of America Largest Commercial Bank In The United States

Bank of America (NYSE: BAC TYO: 8648) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world.

It is the largest American company (by market capitalization) that is not part of the Dow Jones Industrial Average.

Type - Public (NYSE: BAC TYO: 8648)
Founded - (as "Bank of Italy")
San Francisco, CA (1928)
(acquiring banks)
Charlotte, NC (1874)
Boston, MA (1784)
Headquarters Charlotte, North Carolina, U.S.
Key people Kenneth D. Lewis, Chairman, CEO & President
Amy W. Brinkley, Global Risk Executive
J. Steele Alphin, CAO
Joe L. Price, CFO
Industry - Banking
Products - Financial Services
Revenue - $117.01 billion USD (2006)[2]
Operating income - $21.64 billion USD (2006)[3]
Net income - $21.13 billion USD (2006)[3][2]
Employees - 203,425 (2006)[2]
Slogan - Bank of Opportunity[1]
Website - www.bankofamerica.com

Again Bare Contessa Everyday Foot Home Make Over Over Recipe Youll

Again Bare Contessa Everyday Foot Home Make Over Over Recipe Youll
Nothing special in "Again Bare Contessa Everyday Foot Home Make Over Over Recipe Youll" post. However would like to share top 10 cooking websites and portal here.

MyDigitalkitchen.com
Recipes, Ingredients, Nutrition & Software

Online-Cookbook.com
Contribute and Share Recipes. Very User Friendly!

RestaurantEdge.com
A comprehensive resource site. All the business tools you need for the restaurant industry.

American Personal Chef Institute & Association
Information Portal for the Personal Chef Industry

Turner New Zealand Gourmet Food
The Ultimate Gourmet Food Store

ItalianChef.com
Classic and new Italian recipes, a newsletter, restaurant reviews and cookbook reviews.

Awesome Chef
Meet Chef Brian Johnson, his recipes, techniques, ingredients and pictures.

Vanilla.com
Socially Conscious Site dedicated to all things Vanilla

The Food Reference
Food, History, Quotes, Trivia, Recipes

Epicurious
For People Who Eat

Brief Century Expanded First Flat History Twenty Updated World

Brief Century Expanded First Flat History Twenty Updated World

The World Is Flat: A Brief History of the Twenty-first Century is a best-selling book by Thomas L. Friedman analyzing the progress of globalization with an emphasis on the early 21st century. It was first released in 2005 and was later released as an "updated and expanded" edition in 2006 and yet again with further alterations in 2007.

Search More Books At : http://www.articlessearchengine.com/Books-Search_Results_8_Book.aspx


Friedman lists ten "flatteners" that have leveled the global playing field:

Collapse of Berlin Wall--11/'89:
The event not only symbolized the end of the Cold war, it allowed people from other side of the wall to join the economic mainstream. (11/09/1989)

Netscape:
Netscape and the Web broadened the audience for the Internet from its roots as a communications medium used primarily by 'early adopters and geeks' to something that made the Internet accessible to everyone from five-year-olds to eighty-five-year olds. (8/9/1995)

Workflow software:
The ability of machines to talk to other machines with no humans involved. Friedman believes these first three forces have become a “crude foundation of a whole new global platform for collaboration.”

Open sourcing:
Communities uploading and collaborating on online projects. Examples include open source software, blogs, and Wikipedia. Friedman considers the phenomenon "the most disruptive force of all."

Outsourcing:
Friedman argues that outsourcing has allowed companies to split service and manufacturing activities into components, with each component performed in most efficient, cost-effective way.

Offshoring:
Manufacturing's version of outsourcing.

Supply chaining:
Friedman compares the modern retail supply chain to a river, and points to Wal-Mart as the best example of a company using technology to streamline item sales, distribution, and shipping.
Insourcing
Friedman uses UPS as a prime example for insourcing, in which the company's employees perform services--beyond shipping--for another company. For example, UPS itself repairs Toshiba computers on behalf of Toshiba. The work is done at the UPS hub, by UPS employees.


In-forming:
Google and other search engines are the prime example. "Never before in the history of the planet have so many people-on their own-had the ability to find so much information about so many things and about so many other people", writes Friedman.

"The Steroids":
Personal digital devices like mobile phones, iPods, personal digital assistants, instant messaging, and voice over IP or VOIP.

Autistic Blue Born Day Extraordinary Inside Mind Savant

Born on a Blue Day: Inside the Extraordinary Mind of an Autistic Savant

Search More Books AT : http://www.articlessearchengine.com/Books-Search_Results_8_Book.aspx

Book Review:

This unique first-person account offers a window into the mind of a high-functioning, 27-year-old British autistic savant with Asperger's syndrome.

Tammet's ability to think abstractly, deviate from routine, and empathize, interact and communicate with others is impaired, yet he's capable of incredible feats of memorization and mental calculation.

Besides being able to effortlessly multiply and divide huge sums in his head with the speed and accuracy of a computer, Tammet, the subject of the 2005 documentary Brainman, learned Icelandic in a single week and recited the number pi up to the 22,514th digit, breaking the European record.

He also experiences synesthesia, an unusual neurological syndrome that enables him to experience numbers and words as "shapes, colors, textures and motions." Tammet traces his life from a frustrating, withdrawn childhood and adolescence to his adult achievements, which include teaching in Lithuania, achieving financial independence with an educational Web site and sustaining a long-term romantic relationship.

As one of only about 50 people living today with synesthesia and autism, Tammet's condition is intriguing to researchers; his ability to express himself clearly and with a surprisingly engaging tone (given his symptoms) makes for an account that will intrigue others as well.

Source: http://www.amazon.com/Born-Blue-Day-Extraordinary-Autistic/dp/1416535071

Enterprise Wiki Success Story from Janssen Cilag Australian Pharmaceutical

Enterprise Wiki Success Story from Janssen-Cilag

Here is another cross post from my FASTForward look at enterprise success stories. Janssen-Cilag is an Australian pharmaceutical subsidiary of Johnson & Johnson. It was using a static HTML site for an intranet.

Called InfoDownUnder, it was originally developed in 2001. Some content was out of date and there was no search capability. Trust in the system was low and demand for change was high.

"Business information that was previously scattered in email (e.g. Business Planning presentations) is now collected into a permanent, secure online space. We have a growing reference and history of information to build on and make available to newcomers. Knowledge management, previously a big concern, has moved off the agenda for the time being." Nathan Wallace, in the CIO at Janssen-Cilag

Source: http://billives.typepad.com/portals_and_km/2007/10/enterprise-wiki.html

Leading the Revolution By Gary Hamel

According to Gary Hamel, the professor-turned-strategy-guru author of Leading the Revolution, complacent establishment giants and one-strategy start-ups are on the same side of the fence--the wrong side.

Corporate complacency and single-strategy business plans leave no room for what Hamel describes as the key to thriving in today's world of business: a deeply embedded capability for continual, radical innovation.

Leading the Revolution is not a calm analysis of what will or won't work in a post-industrial world.

Instead, it's an impassioned call for revolutionary activists to shake the foundations of their companies' beliefs and move from a linear age of getting better, smarter, and faster, to a nonlinear age of becoming different.

While in the past incremental improvements in products and services were accepted as good enough, Hamel shows that true innovation is the demolition and re-creation of an entire business concept. He blows apart the popular myth that innovation lies solely in the hands of dot.com dynamos like AOL and Amazon by scrutinizing the examples of such "gray-haired revolutionaries" as Enron and Charles Schwab, companies that have managed to reinvent both themselves and their entire industries, time and again.

After an in-depth examination of what business-concept innovation involves (for starters, it's "based on avoidance, not attack"), Hamel goes on to motivate his readers to see their own revolutionary future, and train them in the art of being an activist. As he puts it in various headings, be a novelty addict, be a heretic, know what's not changing, surface the dogmas. And then get out there and transform your ideas into reality.

Not simply a round-up call, Hamel's book provides would-be activists with an intelligent, comprehensive plan of action. He illustrates each imperative with examples of real-life corporate rebels, such as John Patrick and David Grossman at IBM, Ken Kutaragi at Sony, and Georges Dupont-Roc at Shell. His message is the same to "old" and "new" companies alike:

"Industry revolutionaries are like a missile up the tail pipe. Boom! You're irrelevant!"

So join the revolution and avoid the explosion.

Herzberg Motivation Hygiene Theory

Herzberg proposed the Motivation-Hygiene Theory, also known as the Two factor theory (1959) of job satisfaction.

According to his theory, people are influenced by two factors:

Satisfaction, which is primarily the result of the motivator factors. These factors help increase satisfaction but have little effect on dissatisfaction.

Dissatisfaction is primarily the result of hygiene factors. These factors, if absent or inadequate, cause dissatisfaction, but their presence has little effect on long-term satisfaction.

Motivator Factors

Achievement
Recognition
Work Itself
Responsibility
Promotion
Growth

Hygiene Factors

Pay and Benefits
Company Policy and Administration
Relationships with co-workers
Physical Environment
Supervision
Status
Job Security

3 Elements of Marketplace Ideology In Information Age By Seth Godin

Seth Godin (born July 10, 1960) is a best-selling author of business books and speaker of the late 1990s to the present. His first book to achieve mainstream popularity was on the topic of permission marketing.

Godin graduated from Tufts University in 1982 with a degree in computer science and philosophy, and he earned his MBA in marketing from Stanford Business School. From 1983 to 1986, he worked as a brand manager at Spinnaker Software.

In 1995, Godin founded one of the first online marketing companies, Yoyodyne. He sold the company to Yahoo! in 1998. As a part of the sale to Yahoo!, Godin became Vice-President of Permission Marketing at Yahoo!.

For a period of time, Godin served as a columnist for Fast Company.

In late 2005, Godin founded the "recommendation network" website Squidoo.


Godin’s ideology combines three elements:

First, the end of the "TV-Industrial complex" means that marketers no longer have the power to command the attention of anyone they choose, whenever they choose.

Second, in a marketplace in which consumers have more power, marketers must show more respect; this means no spam, no deceit and a bias for keeping promises.

Finally, Godin asserts that the only way to spread the word about an idea is for that idea to earn the buzz by being remarkable. Godin refers to those who spread these ideas as "Sneezers", and to the ideas so spread as "IdeaViruses".

He calls a remarkable product or service a purple cow.

Seth Godin is known for a very visual, personal, and dynamic speaking style that has earned him a large following.

He is the author of a popular blog and several books on how ideas spread. Business Week said of him "Seth Godin may be the Ultimate Entrepreneur for the Information Age".

Principles Of Most Influential Leadership

Marshall Goldsmith (March 20, 1949) is an author of management-related literature, professor, consultant and executive coach.

Born in Valley Station, Kentucky, he received his BS from Rose-Hulman Institute of Technology, his MBA from Indiana University and his Ph.D. from UCLA. From 1976-2000 he became an Assistant Professor and then Associate Dean at Loyola Marymount University’s College of Business. He currently is a University Professor at Alliant International University.

Goldsmith is generally regarded as a world authority in helping successful leaders achieve positive lasting change in behavior: for themselves, their people and their teams

Goldsmith's Work

The same beliefs that lead to our success – can make it very difficult for us to change behavior – and, as difficult as it is to change our own behavior, it is even more difficult to change others’ perception of our behavior.

The behavior of leaders need to be reflective of the stated values of the corporation – and that key executives need to ‘go first’ in modeling positive behavioral change.

Managers who receive feedback and engage in ongoing follow-up with co-workers will almost always achieve positive, change in behavior and be seen as more effective leaders by their key stakeholders (this was shown in a Strategy+Business article that involved over 86,000 respondents).

The key to success in executive coaching is not the coach (who is a facilitator of change) – it is the people being coached and their key stakeholders.

Leadership development should provide tools that can be used in a positive, simple, focused and fast manner. Complex theories of change, while interesting, will not work in the ‘real world’ with over-extended executives.

Most executive education has historically been based upon an invalid assumption, “If they understand – they will do.” The basic challenge faced by managers is not understanding the practice of leadership – it is practicing their understanding of leadership.

In 2007, Marshall was voted as the Fourth Most Influential Leadership Professional by Gurus International in an independent internet study.

Cheaper by the Dozen Continuous Quality Improvement By Gilbreth

Cheaper by the Dozen is a 1946 novel by Frank Bunker Gilbreth, Jr. and Ernestine Gilbreth Carey that tells the story of Time and motion study and efficiency experts Frank Bunker Gilbreth and Lillian Moller Gilbreth, and their twelve children.

According to Claude George (1968), Gilbreth reduced all motions of the hand into some combination of 17 basic motions. These included grasp, transport loaded, and hold. Gilbreth named the motions therbligs, "Gilbreth" spelled backwards with the th transposed. He used a motion picture camera that was calibrated in fractions of minutes to time the smallest of motions in workers.

George noted that the Gilbreths were, above all, scientists who sought to teach managers that all aspects of the workplace should be constantly questioned, and improvements constantly adopted. Their emphasis on the "one best way" and the therbligs predates the development of continuous quality improvement (CQI) (George 1968: 98), and the late 20th century understanding that repeated motions can lead to workers experiencing repetitive motion injuries.

Gilbreth was the first to propose that a surgical nurse serve as "caddy" (Gilbreth's term) to a surgeon, by handing surgical instruments to the surgeon as called for. Gilbreth also devised the standard techniques used by armies around the world to teach recruits how to rapidly disassemble and reassemble their weapons even when blindfolded or in total darkness. These innovations have arguably helped save millions of lives.


It has twice been adapted to film.

The title comes from one of Frank Sr.'s favorite jokes: it often happened that when he and his family were out driving and stopped at a red light, a pedestrian would ask "Hey, Mister! How come you got so many kids?" Gilbreth would pretend to ponder the question carefully, and then, just as the light turned green, would say "Well, they come cheaper by the dozen, you know," and drive off.

In real life, the Gilbreths' second eldest child, Mary, died of diphtheria at age six. The book does not explicitly explain the absence of Mary Gilbreth; it was not until the sequel, Belles on Their Toes, was published in 1952 that her death is mentioned.

Cheaper by the Dozen was made into a 1950 motion picture starring Clifton Webb and Myrna Loy as Frank and Lillian Gilbreth. Mildred Natwick's character (a visitor to the household) is ridiculed (and portrayed as a child-hater) for belonging to a Planned Parenthood-like organization.

In the movie, as with the book, no mention is made of Mary Gilbreth's death. The role was cast as younger than the Gilbreth's daughter would have been, and the actress playing Mary appeared with the other children for group scenes, but had no lines and the role was uncredited. Additionally, the birth order of the last two children was reversed, presumably for scripting reasons.

A second book, Belles on Their Toes, published in 1952, outlines the family's adventures after Frank Sr.'s death in 1924. Belles on Their Toes was also made into a movie, starring Jeanne Crain and Myrna Loy, in 1952, and focused on the lives of Mrs. Gilbreth and her children.
A similar movie, Yours, Mine and Ours, is a 1968 film, starring Henry Fonda and Lucille Ball. In this film, Fonda's character is a Navy warrant officer, while Ball's character is a nurse. After some initial tension, the couple and their eighteen children bond to make one large blended family. Both Yours, Mine and Ours and Cheaper By The Dozen served as inspirations for the television show, The Brady Bunch.[citation needed]

Another movie called Cheaper by the Dozen was produced in 2003, starring comedians Steve Martin and Bonnie Hunt, but bearing no resemblance to the original book except that both feature a family with twelve children. A sequel to the film, Cheaper by the Dozen 2 was released in December 2005 across the globe.

Seven Techniques Of Managing for Stakeholders By Freeman

Survival, Reputation, and Success!!

Managing for Stakeholders: Survival, Reputation, and Success, the culmination of twenty years of research, interviews, and observations in the workplace, makes a major new contribution to management thinking and practice.

Current ways of thinking about business and stakeholder management usually ask the Value Allocation Question: How should we distribute the burdens and benefits of corporate activities among stakeholders?

Managing for Stakeholders, however, helps leaders develop a mindset that instead asks the Value Creation Question: How can we create as much value as possible for all of our stakeholders?

Business is about how customers, suppliers, employees, financiers (stockholders, bondholders, banks, etc.), communities, the media, and managers interact and create value.

World-renowned management scholar R. Edward Freeman and his coauthors outline ten concrete principles and seven practical techniques for managing stakeholder relationships in order to ensure a firm’s survival, reputation, and success.

Managing for Stakeholders is a revolutionary book that will change not only how managers do business but also how they recognize and evaluate business opportunities that would otherwise be invisible.

R. Edward Freeman (born December 18, 1951) is an American philosopher and professor of business administration at the Darden School of the University of Virginia. He has also taught at the University of Minnesota and the Wharton School.

Freeman is particularly known for his work on stakeholder theory and on business ethics. He has co-edited recent editions of such standard business textbooks as The Portable MBA and the Blackwell's Handbook of Strategic Management, and serves as the editor for the Ruffin Series in Business Ethics from Oxford University Press.

His latest book is "Managing for Stakeholders" with Jeffrey Harrison and Andrew Wicks to be published by Yale University Press in 2007.

Born in Columbus, Georgia, Freeman received a B.A. from Duke University in 1973 and a Ph.D. from Washington University in 1978.

Mary Parker Follett Principles Of Integration Power Sharing

Mary Parker Follett (1868–1933) was an American social worker, consultant, and author of books on democracy, human relations, and management.

She worked as a management and political theorist, introducing such phrases as "conflict resolution," "authority and power," and "the task of leadership."

Follett was born into an affluent Quaker family in Massachusetts and spent much of her early life there. In 1898 she graduated from Radcliffe College. Over the next three decades, she published several books, including:

1. The Speaker of the House of Representatives (1896)
2. The New State (1918)
3. Creative Experience (1924)
4. Dynamic Administration (1941) (this collection of speeches and short articles was published posthumously)

Follett suggested that organizations function on the principle of power "with" and not power "over."

She recognized the holistic nature of community and advanced the idea of "reciprocal relationships" in understanding the dynamic aspects of the individual in relationship to others.

Follett advocated the principle of integration, "power sharing." Her ideas on negotiation, power, and employee participation were influential in the development of organizational studies.

She was a pioneer of community centres.

Total Quality Control Hidden Plant By Feigenbaum

"Because quality is everybody's job, it may become nobody's job - the idea that quality must be actively managed and have visibility at the highest levels of management. " - Feigenbaum

Armand V. Feigenbaum is an American quality control expert who was born in 1922. He received a bachelor's degree from Union College, and his master's degree and Ph.D. from MIT. He was Director of Manufacturing Operations at General Electric (1958-1968), and is now President and CEO of General Systems Company of Pittsfield, Massachusetts, an engineering firm that designs and installs operational systems.

He wrote several books and served as President of the American Society for Quality (1961-1963). Feigenbaum's contributions to the quality body of knowledge include:

1. Total Quality Control (TQC) - "Total quality control is an effective system for integrating the quality development, quality maintenance, and quality improvement efforts of the various groups in an organization so as to enable production and service at the most economical levels which allow full customer satisfaction.
2. "the hidden" plant - the idea that so much extra work is performed in correcting mistakes that there is effectively a hidden plant within any factory.
3. Because quality is everybody's job, it may become nobody's job - the idea that quality must be actively managed and have visibility at the highest levels of management.

f-Laws 13 Common Sins of Management

Laws are subversive epigrams about common management practices.

Systems theorist Russell L. Ackoff and his co-author Herbert J. Addison invented the term in 2006 to describe their series of over 100 distilled observations of bad leadership and the misplaced wisdom that often surrounds management in organizations. Many of the f-Laws describe a relationship of inverse proportionality, in example: "The lower the rank of managers, the more they know about fewer things."

Ackoff and Addison's f-Laws often seem counter-intuitive They are designed to challenge organizations' unquestioning adherence to established management habits or beliefs.

The f-Laws advocate adopting a positive, forward-looking and interactive approach to structural or systematic change within organizations, following the principles of idealized design. This is a process that "involves redesigning the organization on the assumption that it was destroyed last night... The most effective way of creating the future is by closing or reducing the gap between the current state and the idealized design".

Two collections of f-Laws entitled A Little Book of f-Laws: 13 Common Sins of Management and Management f-Laws: How Organizations Really Work have been published.

While, if read in isolation, each f-Law is a witty and thought-provoking axiom, the books locate them within a wider discourse that draws upon systems thinking and the debate over the importance of developing soft skills in business environments.

13 Principles of Scientific Management Taylorism Fordism By Frederick Winslow Taylor

Scientific management, Taylorism or the Classical Perspective is a method in management theory which determines changes to improve labour productivity.

The idea first coined by Frederick Winslow Taylor in his The Principles of Scientific Management who believed that decisions based upon tradition and rules of thumb should be replaced by precise procedures developed after careful study of an individual at work.

In management literature today, the greatest use of the concept of Taylorism is as a contrast to a new, improved way of doing business.

Fordism

Taylorism is often mentioned along with Fordism, because it was closely associated with mass production methods in manufacturing factories. Taylor's own name for his approach was scientific management. This sort of task-oriented optimization of work tasks is nearly ubiquitous today in menial industries, most notably in assembly lines and fast-food restaurants.

Critisim - Why Taylorism Failed?

Applications of scientific management sometimes fail to account for two inherent difficulties:

It ignores individual differences: the most efficient way of working for one person may be inefficient for another;
It ignores the fact that the economic interests of workers and management are rarely identical, so that both the measurement processes and the retraining required by Taylor's methods would frequently be resented and sometimes sabotaged by the workforce.
Both difficulties were recognized by Taylor, but are generally not fully addressed by managers who only see the potential improvements to efficiency. Taylor believed that scientific management cannot work unless the worker benefits.

In his view management should arrange the work in such a way that one is able to produce more and get paid more, by teaching and implementing more efficient procedures for producing a product.

Although Taylor did not compare workers with machines, some of his critics use this metaphor to explain how his approach to be made efficient by removing unnecessary or wasted effort.

13 Principles Of Scientific Management - Taylorism

1. To regularize operations in a manner which will conserve the investment, sustain the enterprise, and assure continuous operation and employment.

2. To assure the employee of continuous operation and employment by a planned and balanced continuous earning opportunity while on the payroll.

3. Thru waste-saving management and processing techniques, entitle the workers and management to increased wages and profits.

4. To make possible a higher standard of living to workers.

5. To assure a happier home and social life to workers.

6. To assure healthful and socially agreeable conditions of work.

7. To assure the highest opportunity for individual capacity thru scientific methods of work analysis and of selection, training, assignment, transfer, and promotion of workers.

8. To assure by training and functional foremanship the opportunity for workers to develop new and higher capacities, and eligibility for promotion to higher positions.

9. To develop self-confidence and self-respect among workers.

10. To develop self-expression and self-realization among workers thru an atmosphere of research and validation.

11. To build character thru the proper conduct of work.

12. To promote justice thru the elimination of discrimination in wage rates and elsewhere.

13. To eliminate factors in the environment which are irritating and cause frictions, and to promote common understanding, tolerances, and the spirit of team work.

14 Principles Of Business Transformation By Edwards Deming

Deming offered fourteen key principles for management for transforming business effectiveness. In summary:

Create constancy of purpose for the improvement of products and services, with the aim to become competitive, stay in business, and provide jobs.

Adopt a new philosophy of cooperation (win-win) in which everybody wins and put it into practice by teaching it to employees, customers and suppliers.

Cease dependence on mass inspection to achieve quality. Instead, improve the process and build quality into the product in the first place.

End the practice of awarding business on the basis of price tag alone. Instead, minimize total cost in the long run. Move toward a single supplier for any one item, based on a long-term relationship of loyalty and trust.

Improve constantly, and forever, the system of production, service, and planning of any activity. This will improve quality and productivity and thus constantly decrease costs.

Institute training for skills.

Adopt and institute leadership for the management of people, recognizing their different abilities, capabilities, and aspirations. The aim of leadership should be to help people, machines, and gadgets do a better job. Leadership of management is in need of overhaul, as well as leadership of production workers.

Drive out fear and build trust so that everyone can work more effectively.

Break down barriers between departments. Abolish competition and build a win-win system of cooperation within the organization. People in research, design, sales, and production must work as a team to foresee problems of production and use that might be encountered with the product or service.

Eliminate slogans, exhortations, and targets asking for zero defects or new levels of productivity.

Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.

Eliminate numerical goals, numerical quotas, and management by objectives. Substitute leadership.

Remove barriers that rob people of joy in their work. This will mean abolishing the annual rating or merit system that ranks people and creates competition and conflict.

Institute a vigorous program of education and self-improvement.

Put everybody in the company to work to accomplish the transformation. The transformation is everybody's job.

14 Principles of Management Henri Fayol Management Principles

Henri Fayol (born 1841 in Istanbul; died 1925 in Paris) was a French management theorist.

Fayol was one of the most influential contributors to modern concepts of management, having proposed that there are five primary functions of management:

Planning,
Organizing,
Commanding,
Coordinating, and
Controlling

Controlling is described in the sense that a manager must receive feedback on a process in order to make necessary adjustments. Many of today’s management texts including Daft (2005) have reduced the five functions to four: (1) planning, (2) organizing, (3) leading, and (4) controlling. Daft's text is organized around Fayol's four functions.

Fayol suggested that it is important to have unity of command: a concept that suggests there should be only one supervisor for each person in an organization. Like Socrates, Fayol suggested that management is a universal human activity that applies equally well to the family as it does to the corporation.

Here are 14 Principles of Management Given by F Henri.

Specialization of labour. Specializing encourages continuous improvement in skills and the development of improvements in methods.

Authority. The right to give orders and the power to exact obedience.

Discipline. No slacking, bending of rules. The workers should be obedient and respectful of the organization.

Unity of command. Each employee has one and only one boss.

Unity of direction. A single mind generates a single plan and all play their part in that plan.

Subordination of Individual Interests. When at work, only work things should be pursued or thought about.

Remuneration. Employees receive fair payment for services, not what the company can get away with.

Centralization. Consolidation of management functions. Decisions are made from the top.

Chain of Superiors (line of authority). Formal chain of command running from top to bottom of the organization, like military

Order. All materials and personnel have a prescribed place, and they must remain there.

Equity. Equality of treatment (but not necessarily identical treatment)

Personnel Tenure. Limited turnover of personnel. Lifetime employment for good workers.

Initiative. Thinking out a plan and do what it takes to make it happen.

Esprit de corps. Harmony, cohesion among personnel. It's a great source of strength in the organisation. Fayol stated that for promoting esprit de corps, the principle of unity of command should be observed and the dangers of divide and rule and the abuse of written communication should be avoided.

3C Model FrameWork

The 3C’s model points out that a strategist should focus on three key factors for success.

The 3C's model (three C's framework) of Kenichi Ohmae, a famous Japanese strategy guru, stresses that a strategist should focus on three key factors for success. "In the construction of any business strategy, three main players must be taken into account:

The corporation itself,
The customer, and
The competition"

Only by integrating the three C's (Customer, Competitor, and Company) in a strategic triangle, sustained competitive advantage can exist. He refers to these key factors as the three C's or the strategic triangle.


The Corporation

The Corporation needs strategies aiming to maximize the corporation’s strengths relative to the competition in the functional areas that are critical to achieve success in the industry.

Selectivity and sequencing
The corporation does not have to lead in every function to win. If it can gain decisive edge in one key function, it will eventually be able to improve its other functions which are now average.

Make or buy
In case of rapidly rising wage costs, it becomes a critical decision for a company to subcontract a major share of its assembly operations. If its competitors are unable to shift production so rapidly to subcontractors and vendors, the resulting difference in cost structure and/ or in the companies ability to cope with demand fluctuations may have significant strategic implications.

Cost-effectiveness
Improving the cost-effectiveness can be done in three ways. First by reducing basic costs, second by exercising greater selectivity (orders accepted, products offered, functions performed) and third by sharing certain key functions with a corporation’s other businesses or even other companies.


The Customer

Clients are the base of any strategy according to Kenichi Ohmae. Therefore, the primary goal supposed to be the interest of the customer and not those of the shareholders for example. In the long run, a company that is genuinely interested in its customers will be interesting for its investors and take care of their interests automatically. Segmentation is helping to understand the customer.

Segmenting by objectives
The differentiation is done in terms of the different ways that various customers use a product.

Segmenting by customer coverage
This segmentation normally emerges from a trade-off study of marketing costs versus market coverage. There appears always to be a point of diminishing returns in the cost versus coverage relationship. The cooperation’s task is to optimize its range of market coverage, geographical and/ or channel wise.

Segmenting the market once more
In a fiercely competition, competitors are likely to be dissecting the market in similar ways. Over an extended period of time, the effectiveness of a given initial strategic segmentation will tend to decline. In such situations it is useful to pick a small group of customers and reexamine what it is that they are really looking for.

A market segment change occurs where the market forces are altering the distribution of the user-mix over time by influencing demography, distribution channels, customer size, etc. This kind of change means that the allocation of corporate resources must be shifted and/ or the absolute level of resources committed in the business must be changed.




The Competitors

The Competitors Competitor based strategies can be constructed by looking at possible sources of differentiation in functions such as: purchasing, design, engineering, sales and servicing. The following aspects show ways in order to achieve this differentiation:

Power of image
When product performance and mode of distribution are very difficult to distinguish, image may be the only source of positive differentiation.

Capitalizing on profit- and cost structure differences
Firstly, the difference in source of profit might be exploited, from new products sales etc. Secondly, a difference in the ratio of fixed costs and variable costs might also be exploited strategically. A company with lower fixed cost ratio can lower prices in a sluggish market and hence gain market share.

Hito-Kane-Mono
A favorite phrase of Japanese business planners is hito-kane-mono, standing for people, money and things. They believe that streamlined corporate management is achieved when these three critical resources are in balance without surplus or waste.

For example: Cash over and beyond what competent people can intelligently expend is wasted. Of the three critical resources, funds should be allocated last.

The corporation should firstly allocate management talent, based on the available mono (things): plant, machinery, technology, process know-how and functional strength. Once these hito (people) have developed creative and imaginative ideas to capture the business’s upward potential, the kane (money) should be given to the specific ideas and programs generated by the individual managers.

4 Dimensions of Relational Work

“Interpersonal savvy is critical in almost any area of business” said Timothy Butler and James Waldroop in their 4 Dimensions of Relational.


How managers can boost their productivity?

1. Hiring the right employees
2. Make the best work (project) assignments
3. Reward performance in the right way
4. Promote career development.

Waldroop and Butler say one should distinguish between 4 types of relational interests and skills:


1. Influence:

Professionals who like developing and extending their area of interpersonal influence! They take contentment in opinion, negotiation and the power of holding valuable information and ideas. This refers to Sales Managers, Marketing Managers, Negotiators and M&A dealmakers.


2. Interpersonal Facilitation:

People that are keenly adjusted to the interpersonal aspects of work situations.
They intuitively focus on others' experiences and usually quietly behind the scenes to keep their colleagues committed and engaged so that projects run smoothly.
This refers to HR managers.


3. Relational Creativity:

People who are good at forging connections with groups of people through visual and verbal imagery!

This refers to advertising people and brand managers.


4. Team Leadership:

Such people feel satisfied with a strong need to see and interact with other people.

They like managing and working through high-energy teams in hectic service environments. This is mainly applicable to Program Managers and Managers of Direct Service Delivery Units.

These four dimensions of relational work are not distinct types; a person can have great interest and skill in two or more areas or in none of them. All types of relational work contribute to the end results and thus should be rewarded.

4S Web Marketing Model

Virtual Marketing is becoming necessity day by day. With Virtual Marketing – strategic analysts have options on believing in applying marketing models like 4Ps, 4Cs, 5Ps, 7Ps or ICDT models. An another model - 4S model is put forward by Constantinides for web marketing also known as “Web-Marketing Model, WMM”

Web-Marketing Model
E. Constantinides points out important elements of e-marketing. Where 4Ps or 5Ps were successful for traditional and physical marketing, 4S by Constantinides is becoming successful model for web marketing.

It describes web marketing strategy with four elements begin with “4S" including
• Scope,
• Site,
• Synergy and
• System.

The goal of this model is to design and develop marketing mix for B2C online projects through controlling four “S" elements.

4S of Web Marketing In Detail

The 4S Web Marketing Mix method from Constantinides identifies the following four critical decision-making elements of E-Marketing:


SCOPE

Scope defines the main strategic issues at the bottom of the online presence; these are subject to continuous management review and appraisal. The scope word should be referred in terms of markets and competitors, customer profiles, impact of the online operation on existing internal processes and the firm's online presence.

In 4S model, the scope element is of primarily strategic character and outlines the decisions to be made on four areas:

• The strategic and operational objectives of the online venture;
• The market definition including measuring the market potential and the identification/classification of the potential competitors, visitors and customers of the site;
• The degree of readiness of the organization for E-Commerce;
• The strategic role of E-Commerce for the organization.


SITE


Site identifies the operational aspects of the online presence reflecting the character, positioning and market focus of online firms.

The prime mission of the web Site is to attract traffic, establish contact with the online target markets and brand the online organization.
Thus the corporate web site is functional platform of communication, interaction and transaction with the web customer.


SYNERGY

The synergy factor holds a wide range of issues divided into three categories:

(a) The front office,
(b) The back office and
(c) The third parties in one’s arm.

Online firms will make the most of their market impact by capitalizing on synergies with on hand commercial and organizational processes while they fully utilize their commercial networks.

Integration with the Front Office

This refers to integration of the firm's e-activities in the total corporate marketing plan. The front office refers to conventional corporate communication and distribution strategies. It is mandatory to provide the online presence of the firm the initial support, desired in order to develop as a noteworthy element of the total marketing program.

Integration with the Back Office
This refers to the fact that an extensive integration of e-activities in the current organizational processes that is nothing but a vital condition to meet the needs and expectations of online customers.

The back office synergy includes three issues:

• The integration of E-Commerce physical support into existing organizational processes;
• The legacy integration;
• Integration of the online operation into the company's value system.

Integration of the online presence with existing organizational processes might mean that some of the traditional operations or procedural routines have to be upgraded or re-designed in order to deliver the proper level of virtual customer service and value.

Integration with External Parties and Company Networks

Integration with external parties and company networks is crucial after promotional and logistical activities. They are vital while outsourcing processes which cannot be done internally cost effectively.


SYSTEM

The system factor identifies the technological issues as well as the site servicing issues to be addressed by the E-Commerce management. It provides an outline of technical factors supporting the secure, safe, cost-efficient and customer-friendly operation of the corporate web site.

Understanding 4S with Case study of Marketing Digital Products [1]

Scope

Market segmentation (demographic variables, geographic variables, psychographic variables and behavioral variables) Potential customers (profiles, motivation, behavior and needs)

Internal analysis (internal resources, value process, and the web sustaining technology)

Strategic role of the web activities (information platform, educational, promotional and transactional)

Site
Search Engine Optimization, Link exchange, Advertisements, Factors of web site (domain, content, design, layout, atmosphere etc)

Synergy
Online store, the back office (physical book store)

System
Technology requirement of web site (stabilization, security, software, hardware, protocol, system service etc), Preliminary payment system

[1] A Comparative Study on Marketing Mix Models for Digital Products? By KanLiang Wang1 Yuan Wang Jing Tao Yao

5 Forces Analysis

The

Porter 5 Forces Analysis

is a framework for business management developed by Michael Porter in 1979. It uses concepts developed in Industrial Organization (IO) economics to derive 5 forces that determine the attractiveness of a market. It is also known as FFF (Fullerton's Five Forces).

Porter referred to these forces as the microenvironment, to contrast it with the more general term macro environment. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the marketplace.


Five forces

Bargaining power of customers,
Bargaining power of suppliers,
Threat of new entrants, and
Threat of substitute products
The level of competition
- combined with other variables to influence a fifth force, the level of competition in an industry. Each of these forces has several determinants:


The bargaining power of customers

buyer concentration to firm concentration ratio
bargaining leverage
buyer volume
buyer switching costs relative to firm switching costs
buyer information availability
ability to backward integrate
availability of existing substitute products
buyer price sensitivity
price of total purchase

The bargaining power of suppliers

supplier switching costs relative to firm switching costs
degree of differentiation of inputs
presence of substitute inputs
supplier concentration to firm concentration ratio
threat of forward integration by suppliers relative to the threat of backward integration by firms
cost of inputs relative to selling price of the product
importance of volume to supplier

The threat of new entrants

the existence of barriers to entry
economies of product differences
brand equity
switching costs
capital requirements
access to distribution
absolute cost advantages
learning curve advantages
expected retaliation
government policies

The threat of substitute products

buyer propensity to substitute
relative price performance of substitutes
buyer switching costs
perceived level of product differentiation

The intensity of competitive rivalry

number of competitors
rate of industry growth
intermittent industry overcapacity
exit barriers
diversity of competitors
informational complexity and asymmetry
brand equity
fixed cost allocation per value added
level of advertising expense

7 Ps Marketing Mix

The Marketing Mix is the combination of marketing activities that an organization engages in so as to best meet the needs of its targeted market. Booms and Bitner extended the traditional 4P (McCarthy) framework.

The 7 Ps – Price, Product, Place, Promotion, Physical presence, Provision of service, and Processes encompass the modern marketing mix which is not only essential for service industry but is also significant to any form of business where meeting the needs of customers is given priority.

Traditionally the Marketing Mix consisted of just 4 Ps. The Marketing Mix thus consists of four main elements:

Product
Price
Place
Promotion

Please read 4P Model of Marketing Mix for reference.

In addition to the traditional four Ps it is now normal to add some more Ps to the mix to give us Seven Ps.

The additional Ps have been included because today marketing is far more customer oriented than ever before, and because the service sector of the economy has come to dominate economic activity in this country. These 3 extra Ps are particularly relevant to this new extended service mix.

The three extra Ps are:


Physical Evidence (Physical Layout)

Today consumers approach retail units highly to buy products and they expect a high level of presentation in modern shops - e.g. music stores, garment shops etc. This refers to ambience, atmosphere, environment and hospitality which change consumer’s perceptions of service.

Preconditions are – they should find you easily and they should find good standards and excellent demo / presentation of products from you.

For example it covers -

1. The “environment” or atmosphere in which the service is delivered
2. Buildings
3. Furnishings/décor
4. Layout
5. Goods associated with the service e.g. carrier bags, tickets, brochures
6. All the above can help shape customers’ perceptions of the service

Irrespective of selling physical goods, service provides must pay attention to physical layout’s quality too.

Travelers and Passengers need more hostility and attention in terms of service and should be provided interesting departure lounges.

University students expect more quality in terms of accommodation, education, learning environment and foods.

In terms of virtual stores like Amazon.com – layout is important in terms of easiness to find relevant links and space management.


Provision of Customer Service ( People )

This refers to people of organization who is in direct relationship to customers. Customer service lies at the heart of modern service industries. Call centre staff and customer interfacing personnel are the front line troops of any organization and therefore need to be thoroughly familiar with good customer relation's practice.

Following are essential aspects to be focused on.

1. The attitudes of staff
2. Training of staff
3. Internal relations
4. The observable behavior of staff
5. The level of service-mindedness in the organization
6. The consistency of appearance of staff
7. The accessibility of people
8. Customer-customer contacts


Processes

This refers to procedure, mechanisms and flow of activities by which services are consumed (customer management processes) are an essential element of the marketing strategy.

1. The manner in which the service is delivered
2. Degree of customer contact
3. Quality control standards
4. Quality assurance
5. Payment methods
(degree of convenience)
6. Queuing systems for customers
7. Waiting times

7-S McKinsey VBM Model

The 7-S framework of McKinsey is a Value Based Management (VBM) model that describes how one can holistically and effectively organize a company.

The 3Ss across the top of the model are described as 'Hard Ss':

Strategy

The direction and scope of the company over the long term. Plans for the allocation of a firms scarce resources, over time, to reach identified goals.


Structure

The basic organization of the company, its departments, reporting lines, areas of expertise, and responsibility (and how they inter-relate). The way the organization's units relate to each other: centralized, functional divisions (top-down); decentralized (the trend in larger organizations); matrix, network, holding, etc.

Systems

Formal and informal procedures that govern everyday activity, covering everything from management information systems, through to the systems at the point of contact with the customer (retail systems, call centre systems, online systems, etc).

The procedures and routines that characterize how important work is to be done: financial systems; hiring, promotion and performance appraisal systems; information systems.

The 4Ss across the bottom of the model are less tangible, more cultural in nature, and were termed 'Soft Ss' by McKinsey:

Skills

The capabilities and competencies that exist within the company. What it does best. Distinctive capabilities of personnel or of the organization as a whole.


Shared Values

The values and beliefs of the company. Ultimately they guide employees towards 'valued' behavior. The interconnecting center of McKinsey's model is: Value. What does the organization stands for and what it believes in.

Staff

The company's people resources and how they are developed, trained, and motivated. Numbers and types of personnel within the organization.

Style

The leadership approach of top management and the company's overall operating approach. Cultural style of the organization and how key managers behave in achieving the organization’s goals.

Related Links

Mckinsey

Balanced Scorecard

The Balanced Scorecard method of Kaplan and Norton is a strategic approach and performance management system that enables organizations to translate a company's vision and strategy into implementation, working from 4 perspectives:

1. Financial perspective,
2. Customer perspective,
3. Business process perspective,
4. Learning and growth perspective.

The Financial Perspective

Kaplan and Norton do not disregard the traditional need for financial data. Timely and accurate funding data will always be a priority, and managers will do whatever necessary to provide it.

In fact, often there is more than enough handling and processing of financial data. With the implementation of a corporate database, it is hoped that more of the processing can be centralized and automated. But the point is that the current emphasis on financials leads to the "unbalanced" situation with regard to other perspectives.

There is perhaps a need to include additional financial-related data, such as risk assessment and cost-benefit data, in this category.


The Customer Perspective

Recent management philosophy has shown an increasing realization of the importance of customer focus and customer satisfaction in any business.

These are leading indicators: if customers are not satisfied, they will eventually find other suppliers that will meet their needs. Poor performance from this perspective is thus a leading indicator of future decline, even though the current financial picture may look good.

In developing metrics for satisfaction, customers should be analyzed in terms of kinds of customers and the kinds of processes for which we are providing a product or service to those customer groups.

The Business Process Perspective

It refers to internal business processes. Metrics based on this perspective allow the managers to know how well their business is running, and whether its products and services conform to customer requirements (the mission). These metrics have to be carefully designed by those who know these processes most intimately.

In addition to the strategic management process, two kinds of business processes may be identified: a) mission-oriented processes, and b) support processes.

Mission-oriented processes are the special functions of government offices, and many unique problems are encountered in these processes. The support processes are more repetitive in nature, and hence easier to measure and benchmark using generic metrics.

The Learning and Growth perspective

This includes employee training and corporate cultural attitudes related to both individual and corporate self-improvement. In a knowledge-worker organization, people are the main resource. In the current climate of rapid technological change, it is becoming necessary for knowledge workers to be in a continuous learning mode.

Government agencies often find themselves unable to hire new technical workers and at the same time is showing a decline in training of existing employees.

Kaplan and Norton emphasize that 'learning' is more than 'training'; it also includes things like mentors and tutors within the organization, as well as that ease of communication among workers that allows them to readily get help on a problem when it is needed. It also includes technological tools such as an Intranet.

The integration of these four perspectives into a graphical appealing picture have made the Balanced Scorecard method very successful within the Value Based Management philosophy.


Related Links

Balanced Scorecard Institute

Boston Consulting Group BCG Matrix

To ensure long-term value creation, a company should have a portfolio of products that contains both high-growth products in need of cash inputs and low-growth products that generate a lot of cash.

The BCG matrix is a tool that can be used to determine what priorities should be given in the product portfolio of a business unit.

It has 2 dimensions:

Market share
Market growth
The basic idea behind it is that the bigger the market share a product has or the faster the product's market grows the better it is for the company.

Placing products in the BCG matrix results in 4 categories in a portfolio of a company:


Stars

High growth, High market share

Use large amounts of cash and are leaders in the business so they should also generate large amounts of cash frequently roughly in balance on net cash flow.
However if needed any attempt should be made to hold share, because the rewards will be a cash cow if market share is kept.

Cash Cows

Low growth, High market share

Profits and cash generation should be high , and because of the low growth, investments needed should be low. Keep profits high
Foundation of a company

Dogs

Low growth, Low market share

Avoid and minimize the number of dogs in a company.
Beware of expensive ‘turn around plans’.
Deliver cash, otherwise liquidate

Question Marks

High growth, Low market share

Have the worst cash characteristics of all, because high demands and low returns due to low market share
If nothing is done to change the market share, question marks will simply absorb great amounts of cash and later, as the growth stops, a dog.
Either invests heavily or sell off or invest nothing and generate whatever cash it can. Increase market share or deliver cash

Using the BCG Matrix can help understand a frequently made strategy mistake: having a one-size-fits-all-approach to strategy, such as a generic growth target (9 percent per year) or a generic return on capital of say 9,5% for an entire corporation.

In such a scenario:

A. Cash Cows Business Units will beat their profit target easily; their management have an easy job and are often praised anyhow. Even worse, they are often allowed to reinvest substantial cash amounts in their businesses that are mature and not growing anymore.

B. Dogs Business Units fight an impossible battle and, even worse, investments are made now and then in hopeless attempts to 'turn the business around'.

C. As a result (all) Question Marks and Stars Business Units get mediocre size investment funds. In this way they are unable to ever become cash cows. These inadequate invested sums of money are a waste of money.

Either these SBUs should receive enough investment funds to enable them to achieve a real market dominance and become a cash cow (or star), or otherwise companies are advised to disinvest and try to get whatever possible cash out of the question marks that were not selected.

The BCG Matrix chart was popular for two decades and "continues to be used as a primer in the principles of portfolio management," as BCG says.

About BCG

The Boston Consulting Group (BCG) is a management consulting firm founded by Harvard Business School alum Bruce Henderson in 1963.

The Boston Consulting Group
Type - Partnership
Founded In 1963
Headquarters - 63 offices in 37 countries
Key people - Hans-Paul Bürkner, President & CEO
Industry - Management consulting
Products - Management consulting services
Revenue 2005 : US$1.5 billion
Employees about 4,100 consultants
Website - www.bcg.com

See also

The Sequence of Strategy Utilizing the BCG Growth / Market Share Portfolio Matrix





Source: Rob Millard

Business Management Theories

Management today is seen in multiple areas. Towards the end of the 20th century, business management came to consist of six separate branches, namely:

Human resource management
Operations management or production management
Strategic management
Marketing management
Financial management
Information technology management responsible for management information systems

Here is list of management arena where multiple theories were evolved based on need to grow & maintain quality of product / service.

List of Areas and Categories and Implementations of Management

Accounting management
Agile management
Association management
Capability Management
Change management
Communication management
Constraint management
Cost management
Crisis management
Critical management studies
Customer relationship management
Design management
Disaster management
Earned value management
Educational management
Enterprise management
Environmental management
Facility management
Financial management
Human resources management
Information technology management
Innovation management
Interim management
Inventory management
Knowledge management
Land management
Leadership management
Logistics management
Lifecycle management
Marketing management
Materials management
Operations management
Organization development
Perception management
Program management
Project management
Process management
Performance management
Product management
Public administration
Public management
Quality management
Records management
Research management
Resource management
Risk management
Skills management
Social entrepreneurship
Spend management
Strategic management
Stress management
Supply chain management
Systems management
Talent management
Time management
Visual management

Business Process Reengineering

"A fundamental corporate reorganization based upon the processes that deliver value to customers. It typically involves re-orienting a business from a product or location viewpoint to a customer focus."

The Business Process Reengineering method (BPR) is defined by Hammer and Champy as 'the fundamental reconsideration and radical redesign of organizational processes, in order to achieve drastic improvement of current performance in cost, service and speed'.

Value creation for the customer is the leading factor for BPR and information technology often plays an important enabling role.

Five-step approach to the Business Process Reengineering model:

1. Develop the business vision and process objectives: The BPR method is driven by a business vision which implies specific business objectives such as cost reduction, time reduction, output quality improvement.

2. Identify the business processes to be redesigned: most firms use the 'High- Impact' approach which focuses on the most important processes or those that conflict most with the business vision. Lesser number of firms use the 'Exhaustive approach' that attempts to identify all the processes within an organization and then prioritize them in order of redesign urgency.

3. Understand and measure the existing processes: for avoiding the repeating of old mistakes and for providing a baseline for future improvements.

4. Identify IT levers: awareness of IT capabilities can and should influence BPR.

5. Design and build a prototype of the new process: the actual design should not be viewed as the end of the BPR process. Rather, it should be viewed as a prototype, with successive iterations. The metaphor of prototype aligns the Business Process Reengineering approach with quick delivery of results, and the involvement and satisfaction of customers.

As a 6th step of the BPR method some mention to adapt the organizational structure and governance model towards the newly designed primary process.

When should BPR be used?

Although it is difficult to give generic advice on this, some factors that can be considered are:

Is the competition outperforming the company by factors?
Are there many conflicts in the organization?
Is there an extremely high frequency of meetings?
Excessive use of non-structured communication? (memos, emails, etc)
Is a more continuous approach of incremental improvements not possible? (see: Kaizen).

When Kaizen is compared to the BPR method is it clear the Kaizen philosophy is more people-oriented, more easy to implement, requires long-term discipline.

The Business Process Reengineering approach on the other hand is harder, technology-oriented, enables radical change but requires major change management skills.

Capability Maturity Model

The Capability Maturity Model is an organizational model that describes 5 evolutionary stages (levels) in which an organization manages its processes.

Description of the Capability Maturity Model (CMM)

CMM describes 5 evolutionary stages in which an organization manages its processes. The thought behind the Capability Maturity Model, originally developed for software development, is that an organization should be able to absorb and carry its software applications. The model also provides specific steps and activities to get from one level to the next.


The 5 stages of the Capability Maturity Model are:

Initial (processes are ad-hoc, chaotic, or actually few processes are defined)
Repeatable (basic processes are established and there is a level of discipline to stick to these processes)

Defined (all processes are defined, documented, standardized and integrated into each other)
Managed (processes are measured by collecting detailed data on the processes and their quality)
Optimizing (continuous process improvement is adopted and in place by quantitative feedback and from piloting new ideas ands technologies)

The Capability Maturity Model is useful not only for software development, but also for describing evolutionary levels of organizations in general and in order to describe the level of Value Based Management that an organization has realized or wants to aim for.

Clarkson Principles

The Clarkson Principles of Stakeholder Management originate from four conferences that were hosted by the Centre for Corporate Social Performance and Ethics in the Faculty of Management [now called: the Clarkson Centre for Business Ethics & Board Effectiveness or CC(BE)] between 1993 and 1998.

In these conferences, management students gathered to share ideas on stakeholder theory, a then emerging field of study examining the relationships and responsibilities of a corporation to employees, customers, suppliers, society, and the environment.

The Clarkson Principles represent an early stage general awareness of corporate governance concerns that have been widely discussed in connection with the business scandals of 2001-2003.


Principle 1
Managers should acknowledge and actively monitor the concerns of all legitimate stakeholders, and should take their interests appropriately into account in decision-making and operations.

Principle 2
Managers should listen to and openly communicate with stakeholders about their respective concerns and contributions, and about the risks that they assume because of their involvement with the corporation.

Principle 3
Managers should adopt processes and modes of behavior that are sensitive to the concerns and capabilities of each stakeholder constituency.

Principle 4
Managers should recognize the interdependence of efforts and rewards among stakeholders, and should attempt to achieve a fair distribution of the benefits and burdens of corporate activity among them, taking into account their respective risks and vulnerabilities.

Principle 5
Managers should work cooperatively with other entities, both public and private, to insure that risks and harms arising from corporate activities are minimized and, where they cannot be avoided, appropriately compensated.

Principle 6
Managers should avoid altogether activities that might jeopardize inalienable human rights (e.g., the right to life) or give rise to risks which, if clearly understood, would be patently unacceptable to relevant stakeholders.

Principle 7
Managers should acknowledge the potential conflicts between (a) their own role as corporate stakeholders, and (b) their legal and moral responsibilities for the interests of stakeholders, and should address such conflicts through open communication, appropriate reporting and incentive systems and, where necessary, third party review.

The Clarkson Principles should be regarded as “meta-principles”, encouraging and requiring management to develop more specific stakeholder principles and then to implement those in accordance with the Principles.