The Ascent of money

1. The Ascent of money

2. NEW TOPIC! MANAGMENT PROCESS txt pg. 98

3. Management process • Coordinating key business functions and Resources • Use KRB as an example to identify key business functions and appropriate resources

4. Coordinating key business functions and Resources • Identifying business functions: • Core business function • Other functions • Profit to owners/shareholders • Supply a products/service to consumers • Coordinating business functions • Planning each part of the production of product or any stage or production • Planning operations • Production, marketing, finance and HR are coordinating units • Markets for goods and services • Place where the consumer (buyer) and producer (seller) meet. • Wholesalers and retailers • Today also have stock market/e-commerce

5. Identifying the Business Functions Operations Organising the production of goods and services. Includes:- business location, premises layout, number of employees, types of equipment Employment relations Organising the human resources. Hiring and firing, finding right skills, training, motivation. Marketing Link between the business and the consumer. Drives the business. Identifies what consumers want and then plans to meet these wants at an acceptable price. Includes promotion. Accounting and Financing Provides the financial resources. Controlling how finances are used and regular reports on the business’s operation.

6. Identifying the Business Functions Operations Human Resources Marketing Accounting and Finance

7. Identifying the Business Functions Operations Human Resources Marketing Accounting and Finance 28 min. Using Holden as a case study, this program looks at the four key functions performed in business on a daily basis: manufacturing operations; human resources; marketing and sales; and finance. Take down five terms on each of the four business functions to write a paragraph on each at the end of the video.

8. Key business functions of...

9. HOLDEN AND KBF’s Which functional area is most important to the operation of Holden Ltd? Could the organisation exist without any of the functional areas? Would Holden benefit from outsourcing any of the functions?

10. Holden's new solar powered car • Imagine that Holden has decided that it wants to develop a new solar-powered car. Explore how each of the 4 functional areas discussed in the video might be affected: Manufacturing Operations, Human Resources, Finance and Marketing & Sales in terms of the key management roles of planning, leading organising and controlling.

11. Vice President GoogleMich Mathews You have been appointed CEO of Holden! Your first thought is that you want to know how successful each functional area of the organisation has been lately. • Suggest 3 Key Performance Indicators that would be appropriate to evaluate the success of the 4 Functional Areas discussed in the video. • What evidence of success was shown in the video?

12. Coordinating the Business Functions The different functions of the business are INTERDEPENDENT. Small business owners are closer to their customers than large business. Large business managers may even lose touch with their business operations. Shareholders may have very little to do with the day to day running of the business.

15. KRB: key business functions and appropriate resources IN PAIRS ON POSTERS COME UP WITH KRB’s KEY BUSINESS FUNCTIONS AND WHAT RESOURCE EACH FUNCTION NEEDS

16. Management: Operations • goods and/or services • the production process • quality management

17. goods and/or services What is a good and what is a service...do any businesses provide both?

18. GOODS VS SERVICES • GOOD: An item that is tangible. It can be seen or touched.;E.g... • SERVICE: An intangible good that is provided by an individual or organisation; E.g...

20. The production process • What is the production process of a ...? • Surfboard • Chocolate • Cheeseburger • designer dress • Cookies • Car wash

21. The production process • Organising operations in a business involves managing the production process. • The production process includes identifying and procuring the inputs that will be transformed by the business into the final goods and services. • MANUFACTORING – transformation in factory • SERVICES – transformation in offices • In organising production the business managers will try to reduce cost, maximise efficiency and provide quality goods and services

22. Production process • Division of labour • Breaking down tasks to the simplest level and designing jobs and employing people to do these jobs • Division of labour brings advantages to an organisations as people become SPECIALISTS they become more EFFICIENT • Specialising promotes efficiency • Workers rely on other people working in their specialised job to supply the products and services they need. Who does a heart surgeon or tennis professional rely on?

23. The way that businesses create products and services is known as the production process. There are three main parts to the production process: A firm must purchase all the necessary inputs and then transform them into the product (outputs) that it wishes to sell. For example a football shirt manufacturer must buy the fabric, pay someone for a design, invest in machinery, rent a factory and employ workers in order for the football shirts to be made and then sold. How well-organised a firm is at undertaking this transformation process will determine its success. This is known as the productive efficiency of a firm and it will want to be as efficient as possible in transforming its inputs into outputs (i.e. using the minimum number of inputs as possible to achieve a set amount of output). This will reduce the cost per unit of production and allow the firm to sell at a lower price. Ultimately, the objective of the production process is to create goods and services that meet the needs and wants of customers. The needs and wants of customers will be met if a business can produce the correct number of products, in the shortest possible time, to the best quality and all at a competitive price.

24. The Production of Goods and Services • Involves the management of: • people • capital • information • raw materials Role of Operations into Finished goods and services Raw Materials, energy and labour Design Operation of Control of Transformation Processes that convert Each Step Adds Value

25. The production process • Discuss the concept of ‘the production process’ and construct work flow charts demonstrating production of goods and/or services • http://www.thesourcesurfboards.com.au/home

26. Production process ? Goods or Services

27. Production process • In worksheets discuss the concept of ‘the production process ‘and construct work flow charts demonstrating production of goods and/or services

28. The future of food production • No-till agriculture Feeding the world's growing population will require changes to the way we grow things. This might mean leaving the plough behind

29. Chain of command

30. Chain of command • Refers to the way a business structures its channels of authority, power, accountability and responsibility • In a traditional business the chain of command starts with the CEO • Authority and power will move down through various levels (or links) of management, supervisors and workers. • Accountability (and information) moves back u through these links to the CEO

31. Chain of command continued • The chain of command can be shown as an organisation chart • Authority refers to the right a manager has to make certain decisions and to require a subordinate to carry our certain tasks in a satisfactory way. • Power is the ability to cause subordinates to do what is required of them • Responsibility is the duty an employee has to c ary out certain organisation al tasks or functions • Accountability who has authority over them All workers are responsible for something and accountable to someone. The chain of command can be organised by function, product, geography or customers. • See pg. 102

32. Chain of command by function • Organising chain of command is common and can be effective if each functional area does not need to collaborate closely with other departments...e.g.? Head of HR, Finance, manufacturing and marketing and reporting to CEP • E.g.

33. Benefits of chain of command by FUNCTION • Easy to understand • Forms a basis for specialisation • Staff with similar interests and skills can be grouped together • Upper levels of management are likely to be aware of the needs and contributions of the functional areas http://www.wesfarmers.com.au/

34. Quality management • Define ‘quality management’ and its importance

35. Good + Service

37. Quality management Goal of every business should be to create the best possible product and/or deliver the best possible service. Businesses that can deliver high quality products and services will gain a competitive advantage over other similar businesses e.g. http://www.apple.com/au/

38. QUALITY : A FOCUS FOR OPERATIONS • Quality management will only be attained if all the employees in operations are committed to achieving and maintaining quality output... • Is this easy to achieve?

39. Quality management at each stage of the production process • Provide scenarios for an SME ....... • How do managers ensure high quality? • What would a good manager do to rectify poor quality products/services?

40. Total quality management • All aspects of the operations process INPUTS, PROCESSES, AND OUTPUTS are all subjected to constant quality analysis and monitoring ..constant assessment and improvements to promote total quality

41. Control of Operations Quality Control Inspection International Quality Standards TQM Quality Circles Continuous improvement

42. Working Capital =the money needed for the day-to-day requirements of business. DISADVANTAGES of JIT - unable to meet sudden increases in demand, great reliance on suppliers and employees, huge problems if any part of the system breaks down, loss of discounts related to bulk buying. Quality Management Customers define quality. It is different things to different people. But customers demand a high level of quality or they will switch to a competitor. Inspection of products to see it meets the need of the customers. Quality Control =

43. Quality management • Define ‘quality management’ and its importance at each stage of the production process

44. Quality Management • How do managers ensure high quality? • What would a good manager do to rectify poor quality products/services?

45. TERM TWO Management process • coordinating key business functions and resources • operations • goods and/or services • the production process • quality management • marketing • identification of the target market • marketing mix • finance • cash flow statement • income statement • balance sheet • human resources • recruitment • training • employment contracts • separation – voluntary/involuntary • ethical business behaviour management and change • responding to internal and external influences • managing change effectively • identifying the need for change • business information systems • setting achievable goals • resistance to change • management consultants

46. Management process: marketing • identification of the target market • marketing mix The economist http://audiovideo.economist.com/?fr_chl=8c9fb7cb6ccca6fb5c1058e006b34355a6ec141c&rf=bm

47. What is marketing? Distinguish between marketing and sales http://www.smh.com.au/

48. Definition of marketing • Those functions in a business that directly involve contact with the consumer and assessment of their needs, and the translation of this information into outputs for sale. • Marketing is the process of developing a product and implementing a series of strategies aimed at correctly promoting, pricing and distributing the product to a core group of customers.

49. Targeting consumers Why is targeting consumers and identifying a ‘target market’ so important? What sort of magazines/TV shows do you read and watch? What products are advertised? Have you heard of a ‘target market’ what does this term mean in your own words?

50. Identification of the target market • A business needs to clearly establish who the consumers of the product are and them aims its efforts to gain sales towards that market. • E.g. Skim milk, chocolate, surfboards...who are their target market?