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The Nature of Organizations

The Nature of Organizations. Lecture #2. Ripple Effects. Interconnectedness between organizations. Sears Roebuck example. 1993: Sears decided to eliminate catalog sales Ripple effects of that decision. Ripple Effects from Sears.

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The Nature of Organizations

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  1. The Nature of Organizations Lecture #2

  2. Ripple Effects • Interconnectedness between organizations

  3. Sears Roebuck example • 1993: Sears decided to eliminate catalog sales • Ripple effects of that decision

  4. Ripple Effects from Sears • Company that photographed home furnishings for Sears lost sales of $400k/yr • Company that provided flowers for the photography company lost sales of $8k/yr

  5. Ripple Effects from Sears • The store that sold the film lost sales of $10k/yr • The company that processed the film lost sales of $16k/yr

  6. Ripple Effects of Sears • The company that built the sets for the photos lost sales of $25k/yr • The company that printed the catalogs eliminated 800 jobs

  7. Ripple Effects of Sears • The U.S. Postal Service estimated it lost $90 - $100 million/yr in revenues from delivering the catalogs

  8. Environmental Awareness • Political • Economic • Social • Technological

  9. Political Environment • Domestic Government • Foreign Government • Legal Environment • Special Interest Groups

  10. Economic Environment • Customers • Suppliers • Competitors • Investors

  11. Social Environment • Demographics • Culture

  12. Demographics • Which state would be a good choice to test-market products for retired people?

  13. Venn Diagram: Music Today

  14. Venn Diagram: NKOTB

  15. Concert Revenues: 1989 • Rolling Stones: $44 million • NKOTB: $17 million

  16. Concert Revenues: 1990 • Rolling Stones: $44 million • NKOTB: $

  17. Back to P.E.S.T.

  18. Technological Environment • Technology Transfer • Lasers for eye surgery, dental work

  19. Technology Transfer • CDs play for approximately 75 minutes

  20. Technology Transfer • With blue lasers, CDs will play 5 hours

  21. External Environments • Political • Economic • Social • Technological

  22. Internal Resources • Financial • Physical • Human • Technological and System

  23. Financial Resources • Cash • Stocks • Bonds • Net Income

  24. Physical Resources • Plant facilities • Equipment • Raw Materials

  25. Human Resources • Specialized Personnel • Managerial Personnel

  26. Human Resources • Specialized Personnel • Managerial Personnel • Sometimes dependent on demographics

  27. Technological and System Resources

  28. Technological and System Resources

  29. Technological and System Resources

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