Introduction to Managing Organizational Resource
Marketing management is the function that every business needs to fulfill at the best way possible. Marketing means promoting a product by knowing the needs and requirements of the valued customers of the organization. The communication of the customers and the association is required to satisfy the needs of the customers at the foremost without any delay. Marketing and management in combination is a process of planning a product, controlling the product and then channeling the product to meet the desire of the customers in exchange of value that both pay the each other (Logistics / supply chain, 2013).
The decisions regarding the product and designing a structure for profit making through the utilization of optimum resources is the main function of marketing management assignment. Managing organizational resources of the organization means defining the resources available with the business society and managing them in such a manner that the outcomes appear efficiently and effectively (Harrington, Boyson and Ccorsi, 2010). This report defines some of the part of the marketing channels of the product along with the distribution channels. The report also describes the needs of the costing and some of the feature of the marketing strategy. The report is inclusive of the management of the resources of the business society.
DQ1. MARKETING CHANNELS: DESCRIBE THE MAIN FUNCTIONS OF THE MARKETING CHANNELS. WHY THESE FUNCTIONS ARE BETTER ACCOMPLISHED THROUGH COMBINED EFFORTS OF CHANNEL MEMBERS?
Marketing channel is the structure that helps the organization to deliver the produced goods to the ultimate customers for satisfying their needs and requirements. The producer manufactures the products for satisfying the needs of the consumers but can meet the profit level when the goods are delivered to the consumers at their door step. This major concept of marketing channel is the way that connects the production and consumption. It also helps to complete the task of sales, promotion and advertising for a company. Marketing channel helps to motivate and communicate the producers for delivery of the goods and services as soon as possible at a reasonable price (Nestlé Re-balancing Case Study, 2013).
The major functions of the marketing channels are as follows:-
- Gathering information: Marketing channels help to gather the information required for the forecasting of the strategies of potential competitors and analyze the needs of the customers. The information gathered also help to manage the nature of the internal and external environment of the business (Products & Services, 2013).
- Risk management: The major task of marketing channel is to manage the risk factors attached to the channel of distribution and also find out the way for diverting the risk by changing the choosing the next best alternative of channel.
- Promotion of the product: The promotion of the product depends upon the marketing channels. Marketing channel also help to do the promotion of the product through events, gifts, discount, buy one get one, social media display, introductory price issue, lottery, contest, exchange, showcase display, celebrity endorsements etc.
- Finance gathering: Marketing channel shows initial sources for the finance for the product. The finance collected is invested for the development of the position of the product in the market and make new strategy for innovation of the product.
- Contacting the customers: Marketing channel is the source for the maintenance of the records of the customer for updating them about the new product and innovated products. The records also help to make new customers for the products as a linkage.
- Physical distribution of goods: The distribution of the goods to the ultimate consumers is a major task for marketing channel as the without that the actual value of the goods cannot be determined. The channel of marketing also help to store the goods for the time period it is unsold (Supply Chain, 2013).
- Matching of the needs: The match of the demands and the actual existing product is the additional function of marketing channel. The channel helps to recognize the need of the consumers and relate it to the features of the products (The Nestlé Supplier Code, 2010).
The marketing channel is a group effort. The members of the channels are responsible and accountable for completion of the task. As the members of the channel are connected with each other so the whole process is incomplete without any single member. This is the reason why the channel members’ selection is sophisticated task for the management of the company. The channel members help to motivate the channel and the product design. They also show their full support towards monitoring the management of the channels in different regions for the increment of the sale. The channel members are helpful for promoting the product on behalf of the producers by penetrating the market and can also generate the demand for a new product by providing information of the market trends.
- Harrington, L.H., Boyson, S. and Ccorsi, T., 2010. X-SCM: The New Science of X-treme Supply Chain Management. Taylor & Francis US.
- Logistics / supply chain. 2013. [Online]. Available through:
- Products & Services. 2013. [online]. Available through:
- Nestlé Re-balancing Case Study. 2013. [online]. Available through:
- Supply Chain. 2013. [Online]. Available through:
- The Nestlé Supplier Code. 2010. [pdf]. Available through:
DQ2. SUPPLY CHAIN MANAGEMENT (SCM): PROVIDE AT LEAST THREE REASONS WHY SUPPLY CHAIN MANAGEMENT IS AN IMPORTANT PART OF THE VALUE DELIVERY NETWORK
The supply chain management is the transfer of the finished products from the producers to the ultimate consumers. The delivery is supported by distribution of the product at the right place, right time and right price. The distribution of the goods through the proper supply chain management is the major tool for the reduction of the cost and increment of the revenue. There are new trends for the improvement of the supply chain management named as Radio frequency identification, business intelligence, stimulation modeling and business assignment process management (Chaffey,2009).
The supply chain management is responsible for the reduction of cost of the product and it also protects the quality while minimizing the price incurred. The main role of the supply chain management is as follows:
- It helps the cost management team of the company to improve the inventory cost of the product (Chopra, and Meindl, 2009).
- It is an advantage for the company who is having the good supply chain management as this provides the information sharing network between the participants of the chain.
- It helps to improve the capacity of the company to satisfy the need of the consumers by providing value based goods and services (Christopher, 2010).
- The trust factor of the participants of the chain is maintained by the supply chain of the company.
- It provides the regular strategy for the development of the manufacturing unit of the organization (Harrington, Boyson and Ccorsi, 2010).
- It also shows an interest to improve the integration process of the organization so that the value of the organization increases internally and externally.
- The supply chain is accountable for the improvement of the bottom line of the company as by decreasing the use of the fixed assets.
- The cash flow of the company is improved because of the value based supply chain management system as the cash management is fully related to the supply of the product to the customer (Kotzab and Bjerre, 2005).
- The increment of the profit margin of the company along with the increment of the quality of the product is the result of the better supply chain management.
The value delivery network is the network that is created for the increment of the value of the customers. Firstly, the customer’s value is an exclusive part for the value chain of the company and is not focused while deciding the product for the customers. Secondly, the supply chain management helps to increase the customer’s value for the company. Thirdly, the management of the supply chain is related to the value delivery network because the supply chain is responsible for the customer’s satisfaction through the value based goods, for the suppliers through regular income, for producers through profit, for market through regular demand and supply maintenance etc. The supply chain not only provides this facility but also retain the value of the product regular for the customers. The bridge that connects products actual needs fulfillment power to the customer’s need is the supply chain management (Stadtler and Kilger, 2007).
- Chaffey,& D., 2009. E-Business and E-Commerce Management: Strategy, Implementation and Practice. 4th ed. Financial Times/Prentice Hall.
- Chopra, S. and Meindl, P., 2009. Supply Chain Management: Strategy, Planning and Operation. 4th ed. Pearson Education.
- Christopher, M., 2010. Logistics and Supply Chain Management. 4th ed. FinancialTimes/Prentice Hall.
- Harrington, L.H., Boyson, S. and Ccorsi, T., 2010. X-SCM: The New Science of X-treme Supply Chain Management. Taylor & Francis US.
- Kotzab, H. and Bjerre, M., 2005. Retailing in a Scm-Perspective. Copenhagen Business School Press DK.
- Stadtler, H., and Kilger, C., 2007. Supply Chain Management and Advanced Planning: Concepts, Models, Software and Case Studies. 4th ed. Springer.
DQ3.COMPARISON OF ANALYTICAL METHODS: IN A FOUR PARAGRAPH ESSAY USING THEORY AND YOUR EXPERIENCE, COMPARE AND CONTRAST THE USE OF COST-VOLUME-PROFIT ANALYSIS, BREAK-EVEN ANALYSIS AND CONTRIBUTION MARGIN ANALYSIS
Cost-volume-profit analysis is helpful for the business managers to make best business decisions of the company. CVP analysis helps the manager to analyze the market condition and situations, which automatically make the manager efficient in making predictions for future goals and vision. This also provides support to the managers to answer specific pragmatic questions, which have a relation in business analysis. Manager has an idea of the breakeven point of the company and he can change the level of spending and increase production efforts, which will automatically increase the profitability of the company. Cost-Volume-Profit analysis is based on statistical issues of the maintenance process and the decisions related to the future goals (Turban,2009).
Break even is among the most widely used tools employed for the evaluation of economic feasibility of a company or a product. It is the point where revenues are equivalent to costs. In simple terms, no profit is made nor is any loss incurred at this point. This breakeven point is generally expressed in unit sales. It means that the extent of sales, which are needed to cover up the cost, is indicated by breakeven units. This analysis is dependent on two types of costs i.e. fixed and variable. This analysis gives answer to queries like “the amount of sales to be reduced while still maintaining the profitability of the company (Weth, 2007).
Contribution margin analysis is a cost accounting concept that determines the profitability of every individual product. It is a gross operating cost of a product, which is calculated as product price minus its total variable coast. Contribution margin is associated with the product and it is the amount, which is left out after the deduction of sales revenue. It is an important cost accounting concept (Kalubanga, 2012). It is helpful in making much important decision in the business. A business manager determines that a particular product has a 30% contribution margin, which is less than the company’s other product. The manager can determine whether variable cost for the specific product must be reduced or the sale price of the product could be increased. If both of these options are not attractive, manager can take a decision to drop this product. The contribution margin analysis can be used to remove or add products and product lines or to make informed pricing decision.
- Kalubanga, M., 2012. Sustainable procurement: Concept, and Practical Implications for the Procurement Process. International Journal of Economics and Management Sciences. 1(7). pp. 1-7.
- Turban,T. and et. al., 2009. Electronic Commerce 2010: A Managerial Perspective. 6th ed. Pearson Education.
- Weth, A., 2007. Supply Chain Management Software Requirements and Mysap Scm. GRIN Verlag.
DQ4. FULL COSTING: WHAT IS FULL COSTING? DEFINE AND COMPARE JOB COSTING AND ACTIVITY-BASED COSTING
Costing is the process of systematic calculation through which we can get the actual cost of the production. There can be some circumstances that the cost needs estimation at the beginning of the investment. The four M’s of the business, which are the most useful thing to be managed on the basis of cost. At every step of production the cost of the raw material and man-force matter a lot for the company to minimize it. In every organization, there is a need for installing the cost system, which automatically forecast the possibility of uncertainties regarding cost of the production (Christopher and Lee, 2004). To systematize the cost factor, the company should firstly find out the main objectives as a list. Secondly, the current working system should be analyzed. Then the structure for the records of the cost should be prepared. Followed by this the determination of the different factors of the cost rate is examined. Further, according to the structure of the records the cost records should be classified and organized (Croom, 2005). This will automatically make an integrated system between the cost departments and the other departments of the organization who are directly or indirectly related to the cost. The costs are of two types such as:
- Fixed cost – A cost that the company never changes according to the change in the revenue of the company and sales of the company is called the fixed cost. Depreciation, insurance, interest, rent, salaries, and wages never affect the fixed cost as the production either happen or not the fixed cost may occur to the company (Dadzie, 1998). The fixed cost is the major aspect as it is the part of the total cost occurred to the organization.
- Variable cost – A cost that may vary with the change in the revenue of the company and the sales figure of the sales department is called the variable cost (Defee, 2010). The cost like Depreciation, insurance, interest, rent, salaries, and wages put full effect on the variable cost as because it changes with the expansion of the production of the units (Evaristo and Zaheer, 2012).
Along with this the other that are the part of the costing system are actual cost, opportunity cost, sunk cost, incremental cost, explicit cost, implicit cost, book cost, out of pocket cost, accounting cost, economic cost, direct cost, indirect cost (Evaristo and Zaheer, 2012).
The main relation and the difference between the job costing and the activity based costing are as follows:
Activity based costing
It is a method in which the cost is calculated and examined in every part of the activities involved from the raw material input to the finished gods as output (McGuffog and Wadsley, 1999).
It is method in which the cost related to every job of the customers specification are analyzed and examined. Job costing is mixture of direct and indirect costs.
Activity Based Costing (ABC) is related to one of the concept of job costing. Traditionally, job costing use to measure the direct as well as the indirect costs. The traditional method was based on labor-intensive. Activity Based Costing identifies the drivers of indirect costs and relates them to particular activities. Under traditional job costing overheads are concentrated and maintained. But in the ABC costing the management of the direct cost and indirect cost is linked to the drivers and the drivers are in relation to the activities of the process.
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