Management for the Future

1. Management for the Future 13.1 Growth Strategies 13.2 Ethical and Social Issues 13.3 Global Trends and Opportunities

2. Lesson 13.1Growth Strategies Goals • Determine when a business is ready to expand. • Explain the importance of planning for growth. • Identify and describe three growth strategies. • List and describe product life cycle stages and steps involved in product development. Chapter 13

3. Vocabulary • market penetration • market development • product life cycle • prototype Chapter 13

4. Determine When to Expand • Consider the Condition of Your Business. • recognition by your community and industry • rising sales • regular customer base • hiring more staff • need more space Chapter 13

5. Assess Economic Conditions • How is the national economy doing? • What are the economic conditions in your industry or region? • Have the demographics of your market changed? • Is demand for your product or service expected to remain strong? • Does your business face new competition? Chapter 13

6. What factors should you consider before deciding to expand your business? Chapter 1

7. Control Your Growth • Create a plan for growth that includes strategies for the following: • attaining measurable objectives and goals • hiring managers and supervisors • financing expansion • obtaining resources for expansion Chapter 13

8. Why is it important to control the growth of your business? Chapter 1

9. Choose a Growth Strategy • Penetrate the Market • market penetration • increasing market share for a product or service • within a given market in a given area • Market share can be increased by: • increasing advertising • offering special deals • providing superior customer service Chapter 13

10. Expand Geographically • Diversify with New Products or Services • market development • a strategy for expanding the target market of a business Chapter 13

11. Use the following guidelines to make sure that your business diversifies successfully. • Focus on areas where you have knowledge. • Choose a product or service that complements what you already sell. • Avoid investing too much capital in new areas before you know if they will be profitable. • Don’t neglect your original product or service line. Chapter 13

12. What are some ways you can expand your business? Chapter 1

13. Product Life Cycle and Development • Stages of a Product Life Cycle • product life cycle • the stages a product goes through from the time it is introduced to when it is no longer sold • can be determined by the type of competition the product is facing Chapter 13

14. Introduction • quite different from existing products • customers don’t know how the product will meet their needs • high price • competition is older, established products • Growth • sales growth • expanded distribution • new, competitive products Chapter 13

15. Maturity • sales peek • profits begin to decline • intense competition • Decline • customers find replacement products • sales and profits drop • no more money is invested in the product • distribution is cut to the most profitable areas Chapter 13

16. New Product Development Chapter 13

17. Idea Development • finding ideas for new products • Idea Screening • Has a market been identified for the product? • Is the competition in the market reasonable? • Are resources available to produce the product? • Is the product legal and safe? • Can a quality product be produced at a reasonable cost? Chapter 13

18. Strategy Development • What is the likely demand for the product? • How would the introduction of the product affect existing products? • Would current customers benefit from the product? • Would the product enhance the image of the company’s overall product mix? Chapter 13

19. Financial Analysis • What impact could the new product have on total sales, profits, market share, and return on investment? • Would the new product affect current employees in any way? • What new facilities, if any, would be needed? • How might competitors respond? • What is the risk of failure? Chapter 13

20. Product Development and Testing • prototype • full-scale model of a new product • production process is designed • needed materials and equipment are obtained • test-marketed • Product Marketing • introduce the product into the target market Chapter 13

21. Why must a business be concerned with the life cycle of a product and with new product development? Chapter 1

22. Lesson 13.2Ethical and Social Issues Goals • Define ethics. • Recognize the need for ethical practices in business. • Discuss an entrepreneur’s social responsibilities. • List ways to meet a business’s environmental responsibilities. Chapter 13

23. Vocabulary • ethics • code of ethics • business ethics Chapter 13

24. What is Ethics? • ethics • the study of moral choices and values • choosing between right and wrong Chapter 13

25. Culture and Ethics • Ethical behavior varies by culture. • bribes • treatment of employees Chapter 13

26. Codes of Ethics • code of ethics • a set of standards or rules that outlines the ethical behavior demanded by: • an individual • a business • a culture Chapter 13

27. What does it mean to have a high code of ethics? Chapter 1

28. Ethics and Business • business ethics • the application of the principles of right and wrong to issues that arise in the workplace • Set High Standards • Businesses recognize that they must behave in an ethical manner. • Inform your customers of your ethical business practices. Chapter 13

29. Establish an Ethical Workplace • You want to establish an ethical workplace for several reasons. • You want to • do the right thing • serve as a role model to others • be proud of the way you conduct yourself, and you want others to be proud of you Chapter 13

30. Ethical behavior is good for business because it gains the trust of customers. • Employees are more likely to act ethically if they see the business owner acting in an ethical manner. • Acting ethically reduces the possibility of being sued. • Ensure confidentiality for all business contacts. • Create a written code of ethics. Chapter 13

31. Why is it important for entrepreneurs to establish and write a code of ethics? Chapter 1

32. Social Responsibilities • Responsibilities to Government • You need to comply with all federal, state, local and administrative laws that affect your business. • Responsibilities to Customers • Treat all customers with respect. • Be honest. Chapter 13

33. Avoid exaggerating the merits of your products or services. • Inform customers of possible product dangers. • Handle disputes fairly. Chapter 13

34. Responsibilities to Suppliers • Treat all suppliers with respect. • Avoid spreading rumors about suppliers. • Give suppliers time to fill your order. • Handle all disputes fairly. • Let your current supplier know the reason for your decision if you change suppliers. Chapter 13

35. Responsibilities to Creditors and Investors • Never conceal risks you are facing. • Responsibilities to Your Community • Contribute Money • Donate Products or Services • Get Involved Chapter 13

36. What are some responsibilities entrepreneurs have to suppliers, customers, and the community? Chapter 1

37. Respect the Environment • The Environmental Protection Agency (EPA) enforces laws governing the environment. • Protect the environment from pollutants. • Conserve nonrenewable resources, such as coal and oil, by using them efficiently. Chapter 13

38. Reduce waste and dispose of waste responsibly. • Use environmentally safe and sustainable energy sources to meet your business needs. • Sell products that cause as little damage to the environment as possible. Chapter 13

39. As a business owner, what are some things you can do to protect the environment? Chapter 1

40. Lesson 13.3Global Trends and Opportunities Goals • Discuss the reasons and methods for participating in the global economy. • Determine whether international business is right for you. • Identify trade regulations that affect international business. Chapter 13

41. Vocabulary • exports • imports • trade barriers • quota • tariff • qualitative restriction Chapter 13

42. Exports and Imports • Exporting • exports • products and services that are produced in one country and sold in another country • Direct Exporting • ship your products directly to buyers or distributors in foreign markets • hire salespeople in the foreign markets Chapter 13

43. Indirect Exporting • commissioned agents • brokers who find foreign buyers for products and services • Selling Worldwide through the Web • customize websites for foreign markets Chapter 13

44. Importing • imports • products and services that are brought in from another country to be sold Chapter 13

45. Why do entrepreneurs participate in exporting and importing? Chapter 1

46. Is International Business Right for You? • Reasons for Competing Globally • Increased sales • Reduced costs • Decreased dependence on current markets and suppliers Chapter 13

47. Analyze the Market • In addition to a target market analysis, you will need to consider: • political issues • economic issues • social issues • cultural issues Chapter 13

48. Write an International Business Plan • Why you want to enter the global marketplace • Which foreign markets you plan to enter • Anticipated revenues • Financing sources • Expected costs • International marketing and sales • International delivery • Legal requirements Chapter 13

49. What are some sources of information that can help you learn about doing business abroad? Chapter 1

50. Government Regulation of International Trade • trade barriers • methods for keeping foreign businesses from competing with domestic producers • quota • a limit on the amount of a product that can be imported into a country over a particular period of time Chapter 13