The Sum-up of Management

Management is one of the greatest, and one of the most common, jobs in the world. Look to all aspects of life, and management behavior (good, bad and otherwise) is being demonstrated. The basic challenge is to increase the amount of “good management” (not an oxymoron, or contradiction in terms!) and to eradicate bad management.

Management should be a calling that should be received by a relatively few people because they have the personal characteristics necessary to be successful in this field; clearly, management is not for everyone. Sadly, management is not for many men and women that currently hold positions in management.

What is the difference between management and leadership? It is a question that has been asked more than once and also answered in different ways. Management and Leadership are distinctly different concepts and should never be confused; however, the best managers have always been (and will always be) good leaders. A person can be a competent manager without being a leader, but great management requires inspirational leadership. Management consists of controlling a group or a set of entities to accomplish goal. Leadership refers to an individual’s ability to influence, motivate, and enable others to contribute toward organizational success. Influence and inspiration separate leaders from managers, not power and control.

Again! Why is it so difficult to find “good management” (or, why is it so easy to be seen as a bad manager?) First, many well-intentioned people working in management should never have accepted management positions. Second, there are relatively few good management models available to individual who wish to improve. Third, legitimate business pressure sometimes cause behavior that is not “good management”, and then bad habits are formed and reinforced over time. Finally, and a common theme to most of “bad management”: good management requires extra effort. In many ways, good management is not a natural behavior, at least in the sense that when people seek the path of least resistance, they will not find good management down that path.

What are the critical functions of management? Effective interpersonal communication is a critical function. Managers are the information pipeline of an organization. Good managers gather critical business information and effectively communicate corporate needs to their employees, and the needs of their employees to upper management. Communicate (listen and speak/write) clearly and often; make decisions based on personal and professional vision and values; build and maintain personal credibility as well as organizational integrity; lead and motivate (encourage and build-up those around you; serve your company and your people.

What can I do to be a better manager? Some people might concern. Pursue an empathetic viewpoint with everyone with whom you come into contact. The vast majority of your contacts will be with sincere, well-intentioned people; try very hard to see their side of the question and you will be more successful in presenting management’s decision.

“If you want to change my behavior, first show me how the proposed change will benefit me.”

Dale Carnegie

Personal Management Journals

This is another assignment that I have done for my Management 360 class. The requirement for this class is that I have to keep a personal journal of 6 entries that have come from different sources.

Journal #1 Like usual I always read newsletter on a Saturday morning. I was scanning through the newspaper to find what interesting topic to read. I saw a section called “Why some restaurants are doing away with tipping”, I started reading and found that the way that the chef-owner Amanda Cohen manage her restaurant is pretty interesting. Amanda Cohen is chef-owner of Dirt Candy restaurant in New York. She eliminating the line to write in a tip on her checks. Instead, a 20 percent ‘administrative fee’ is tacked onto every bill and goes toward employees’ salaries, for both servers and cooks. Chef Cohen’s attempt to chance tipping culture is not just an economic issue; it is also an emotional one. She believe that when you are a server on salary—rather than relying on often-mercurial guests for your financial livelihood—every night is a good night. In the article, her statement was “Everybody works for me. I should be the one to pay them.” From this article, I think this is a good management that Chef Cohen use for her restaurant. I think the idea that if you get bad service, you get to punish the server—that is awful. If the service is bad, the customers can complain, say something to the manager, or let the restaurant take care of it. Instead of going to decide how much they going to pay for the server’s job.

Journal #2 Three years ago, I have the experienced to work at Wal-Mart for 2 years. I believe Wal-Mart have a good management system. At Walmart, management is a mixture of controls and standards with a certain degree of freedom for everyone to be able to test on new things and continue to innovate for improvement. Management strategy is built on teams and the managers go through the process of working with their teams members. Mangers go with the group and after every major operation, they all sit down together to analyze the strengths and improve on the weaknesses of the endeavor. Sam Walton, founder of Wal-Mart, introduced some of the basic concepts of management which were popular with employees until the present. He offered stock options and store discounts to his employees. Walton believed that teams will always do better than individuals hence; he has always tried his best to make his employees happy since happy employees make happy customers and more sales. Another reason he is that he believes that the employees would care about the company more when they are a part of it and their success is dependent on the company’s success. At Wal-Mart, management encourages their employees to be open to talk and air out their concern and problems. This is what they call the “open door policy” management style.

Journal #3 Why can’t Kmart be successful while Target and Walmart thrive? Walmart’s success doesn’t just stem from impressive logistics, aggressive vendor management and its position as a low cost retailer. What really underlies Walmart’s advantage is a coherent and differentiated approach to the market. Target offers a very different value proposition, focuses on different capabilities and has a different product portfolio. Kmart, the least successful of the group, is struggling to define its way to play. The lack of a clear concept about how to reach the market, in our view, is the single most important factor in explaining why Kmart’s fortunes have fallen so far, compared to its two rivals. Kmart does not have a good management system. Without a clear way to play, and capabilities to support it, a company like Kmart cannot achieve coherence it needs to truly excel at what it does, and thus outpace competitors.

Journal #4 I used to work at Deb shops. Deb was a great company to work for. They treated employees very well and corporate was always respectful and helpful. However, Debs going out of business was a hard blow to my entire team. The downside of Deb is the management part. The management was horrible. Things were always changing with no warning; the work load is off balance and not good planning. The amount of tasking can get overwhelming, you work with only one coverage and can have Mark downs, then they will throw a sale change and expect it all to be done within a short amount of time while taking care of customers.

Journal #5 Stopped in at Harry A’s on Saturday night (6/26/2010 – family vacation) at 8pm—just wanted drinks and to listen to the band and dance. My dad ordered a pitcher of Sangria and 2 bottles of water. We left a half pitcher of the two Sangria, 2 full glasses of Sangria and the 2 full unopened bottles of water on the table when we got up to dance. When we returned 5 minutes later the table had been cleared! We asked 3 different servers to resolve the problem and were ignored. Then we asked if a manager could come over to our table and that never had happened. So we went looking for the manager by ourselves. We explained what happened to the manager and her only response was that they were very busy and she begrudgingly shouted to the bartender “get him a ½ pitcher of Sangria” without once offering an apology. My dad then said to her—“This is the way you treat your customers when you staff does something wrong?” At this point the manager walked away to deal with another family that was complaining loudly about the service they had received. My dad stood at the bar for at least 10 minutes being ignored while waiting for his replacement ½ pitcher of wine which he never did receive. He then proceeded to locate the manager he had spoken to who was at that moment embroiled in a loud argument with other complaining family. (At this point it is obvious that management’s attitude is not to satisfy the customer if a problem arises).

Journal #6 Well! Last night I went through one of my worst dining experiences in my life. I met up with my friend at a local pizza and pasta at 8:00pm and ordered my usual order of pasta and garlic sticks. My friend ordered the exact same item. Fifteen minutes later, one order of pasta arrives. I asked the waitress if the second order was on the way soon, the waitress gives me a blank stare. I told my friend to go ahead and eat her meal first, I figured I could wait 15 more minutes. It is important to keep in mind the restaurant was not busy, after all, it was a Monday night and there were only two tables being served. My friends goes about eating her pasta, while I watch the clock. 10 minutes turns to 20, then 25, then 30, then 35. At this point the food has not arrived and I have not seen the waitress in 35 minutes. So I walk to the manager and ask him if he could locate our waitress. He looks around and shrugs. The manager tells me he does not know where the waitress went. My friend has finished eating about 10 minutes ago. One would assume that a concerned restaurant manager would go into the kitchen and check on my food order that seems to have been sucked into a culinary black hole or is burnt to a crisp at this point. What does he do? NOTHING! At 9:30 (an hour and a half later) my food order suddenly appears and the waitress tells me she would be happy to box up my order so I can eat it at home. If I wanted to take out, I would have ordered take out. I told the waitress to tell the manager that I had no intention to pay for my order of pasta that never arrived. I asked her what went wrong and she just shrugged her shoulders and did not offer an explanation. The biggest problem I have is that no apology or explanation was given by restaurant management. When that is the case you know the establishment is going down the tubes. However, the only good thing is that I was told that there would be no charge for the meal. Being the nice girl I am, I still tipped the waitress with a 15% tip. I usually tip 20%, and should I have tipped zero for the awful service I received. Should I have don’t that? Would you?

 

The Interview Assignment

 

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On November 4, 2015 I had the opportunity to interview Mr. Dan who is the owner of Saigon Bistro. I interviewed Mr. Dan because this is a project for my Management class. The requiring for this project is that I have to interview an owner/manager/supervisor in my acquaintance and I have to record/describe that conversation. From the interview I have to connect it to the lectures in some way; what did I learn about management—is the focus of this assignment.  Saigon Bistro is a restaurant that my family and I are pretty familiar with, that is the place that we choose to eat pretty often on the weekends, therefore I asked Mr. Dan for the opportunity to interview him.

Mr. Dan opened a Vietnamese restaurant with a dream of serving Vietnamese foods to not just the Viet people but also American people. He want the American people to have the opportunity to try out different delicious Vietnamese foods. I asked Mr. Dan, what are the effective habits that he need to develop in order to manage his restaurant? He answered by giving me a list of management skills and habits that he set for himself. Mr. Dan said, restaurant management isn’t for everyone. The frenetic pace and constant pressure can be overwhelming for many people. He believe effective restaurant managers need to balance the needs of staff, customers and the business while dealing with the unforeseen problems that pop up on a daily basis. Mr. Dan tries to be proactive and plan his shift at the beginning of each day. He also have a checklist to keep trach of his daily tasks to help him start each shift on the right foot. As a restaurant owner, he always keep an eye on inventory. It is always wise to take a detailed inventory of product before the day starts. “You do not want to be in the middle of a lunch rush when you realize that you are running low on an ingredients. You can also take inventory at night so that you are ready to place orders in the morning, he said. Scheduling is another important thing in planning, he mentioned. He said, manager need to take note of who is working, when they are working and who is available to work if someone does not show up for his or her shift. He believe effective managers post schedules well enough in advance for employees to receive notice, which enables them to be prepared for the week.

Well, that should be enough with planning, let’s move on with different aspect that I asked Mr. Dan, which is about being consistent with the employees or customer. Mr. Dan answered, with the staff he never play favorites. “I believe the staff needs to know that I approach each situation with the same level of fairness for each and every one of them”. In his perspective, he thinks as soon as the manager lean on favoritism, they will undermine the trust of their staff and mark themselves as unreliable. He strongly thinks that it can be hard to be the “bad guy” but maintaining the same level of consequences for all employees will gain him their respect and confidence in the long run. On the other hand, with the customers, he believe that as soon as the customers walk in the front door their experience is in his hands. As a restaurants

owner it is his job to ensure that the food and service are always consistent.

Does communication important in management? I asked. “Oh YES”, he answered. Effective communication with the staff is absolutely necessary in the chaotic world of the restaurant industry, he continued. Mr. Dan usually have staff meetings at the beginning of each shift to review expectations, or inform his employees of any changes in policy and go over dinner specials. He also tries to give his employees positive feedback and let them know when they are doing a great job. Most importantly, he always give his employees the opportunity to be a part of the discussion. He said “this will make them feel more valued and invested in the restaurant”. Since, he only have 10 employees working for him right now, he treated them as his family.

What do you have to do in order to keep your employees motivated at all time? I asked. Mr. Dan said, “I have to be the first one there and the last one to leave”. He explained that if he want the crew to be punctual he better be the first face they see when they walk in the door. This is just as important at the end of the day. He also added that an effective manager stays until the last employee has completed all side work and is checked out with cash and receipts for the day. Also, having a good understanding of every position in the restaurant so that he can jump in where he is needed. Then Mr. Dan say, “I think by maintain a high-energy and enthusiastic approach to your work I have to set the standard for everyone else to follow suit.

Overall, I have learned so much from the interview. The most important thing I learned from Mr. Dan is “attitude adjustments”. I learned that bringing a negative attitude to the work place is the worst thing you can do for employee morale. “Attitude can be contagious; if you come into work with a dark cloud hanging over you expect it to be a bleak place by shift’s end”, Mr. Dan said. I also asked Mr. Dan how to solve this problem and how to stay positive. Mr. Dan’s advice are—don’t try to focus on the problem, it only brings everyone down with you, focus on reaching a solution for one thing at a time, build positive momentum. He added that, sometimes there are things he does not want to do, but by bringing good attitude to difficult task he would make the crew feel more enjoyable. I also learned that, reacting to a crew member’s mistake with harsh criticism does not help the problem. As a restaurant manager it is the responsibility of the manager to ensure the success of their staff. There is one statement that I really like from Mr. Dan is, “Take responsibility for your mistake and view other slip-ups as opportunities for growth that will make you more effective manager”.

One more thing that I learned from the interview on how to manage the restaurant and be successful is “multi-tasking”. Mr. Dan emphasizes that make sure you never get stuck on one task for too long. Successful managers need to keep on the move, floating form one station to the next. He said, it can sometimes feel like you are needed everywhere at once when managing a restaurant. However, while you may feel the need to solve every issue personally, you need to recognize what tasks can be completed without you. Mr. Dan ‘s advice is to “delegate”—delegating a task also shows that you have confidence in your staff, helping to build their self-esteem and also make the operation more effective overall, he says.

I have told Mr. Dan that in the future I really want to open a Vietnamese restaurant, so is there any tips or advice that he would personally give me? Mr. Dan immediately say “face time is the key” I was confused, then he explained to me that “You are the face of the restaurant. You need to greet and interact with at least 50 percent of the customers that come in. no matter how many fires you are putting out behind scenes, remember to make time for customers. They are the reason you have a job”.

 

 

Painful, Valuable Lessons From Taking Charge of My Action

download (4)Sticking your neck out and taking charge of your action is no trivial matter. Whether that is switching careers, going back to school, or walking away from a job to start your own business, it takes a lot of guts.

But guts will only get you so far. Once you build up the nerve ad make the leap, you are no more than 5% of the way there. You still have to succeed in your new endeavor, and trying to succeed is when your worst fears will come true.

I am going to assume you are like me and do not have a brilliant mentor, a rich uncle, or some other person who is going to show you the ropes and explain each step you need to take to take charge of your action.

You see, it’s been 8 years since I last had a boss. I went from working in a restaurant to striking out on my own, eventually starting a home business before I had finished high school.

When I set out on my own, I had all the gumption and appetite for risk that I needed to take charge of my action. At the time I thought that was all I needed to succeed.

It was not. I also needed guidance. Without it, I learned some difficult (and often painful) lessons along the way.

I would like to share some of my biggest lessons learned with you so that they can help you as you charge of your action (in whatever form that takes). As I look back on these lessons, I realize that they are really great reminders for us all.


Confidence Must Come First

Successful people often exude confidence—it is obvious that they believe in themselves and what they are doing. It is not their success that makes them confident, however. The confidence was there first. download (5)

Think about it:

  • Doubt breeds doubts. Why would anyone believe in you, your ideas, or your abilities if you did not believe them yourself?
  • It takes confidence to reach for new challenges. People who are fearful or insecure tend to stay within their comfort zones. But comfort zones rarely expand on their own. That is why people who lack confidence get stuck in dead-end jobs and let valuable opportunities pass them by.
  • Unconfident people often feel at the mercy of external circumstances. Successful people are not deterred by obstacles, which is how they rise up in the first place

Confidence is a crucial building block in a successful career, and embracing it fully will take you places you never thought possible. No one is stopping you from what you want to accomplish but yourself. It is time to remove any barriers created by self-doubt.


You’re Living The Life That You’ve Created

You are not a victim of circumstance. No one can force you to make decisions and take actions that run contrary to your values and aspirations. The circumstances you are living in today are your own—you created them. Likewise, you future is entirely up to you. If you are feeling stuck, it is probably because you are afraid to take the risks necessary to achieve your goals and live your dreams.

When it is time to take action, remember that it is always better to be at the bottom of the ladder you want to climb than at the top of one you do not.images (14)


Being Busy Does Not Equal Being Productive

download (7)Look at everyone around you. They all seem so busy—running from meeting to meeting and firing off emails. Yet how many of them are really producing, really succeeding at a high level?

Success does not come from movement and activity. It comes from focus—from ensuring that your time is used efficiently and productively. You get the same number of hours in the day as everyone else. Use yours wisely. After all, you are the product of your output, not your effort. Make certain your efforts are dedicated to tasks that get results. download (6)


download (11)You’re Only as Good as Those You Associate With 

You should strive to surround yourself with people who inspire you, people who make you want to be better. And you probably do. But what about the people who drag you down? Why do you allow them to be a part your life? Anyone who makes you feel worthless, anxious, or uninspired is wasting your time and, quite possibly, making you more like them. Life is too short to associate with people like this. Cut them loose.


images (16)Don’t Say Yes Unless You Really Want To

Research conducted at the University of California in San Francisco shows that the more difficult that you have saying no, the more likely you are to experience stress, burnout, and even depression, all of which make it difficult to take charge of your action. Saying no is indeed a major challenge for many people. “No” is a powerful word that you should not be afraid to wield. When it is time to say no, avoid phrases like “I don’t think I can” or “I’m not certain”. Saying no to a new commitment honors your existing commitments and gives you the opportunity to successfully fulfill them.


Squash Your Negative Self-Talk       download (8)

When you are taking charge of your action, you will not always have a cheerleader in your corner. This magnifies the effects of self-doubt. The more you ruminate on negative thoughts, the more power you give them. Most of our negative thoughts are just that—thoughts, not facts. When you find yourself believing the negatives and pessimistic things your inner voice says it is time to stop and write them down. Literally stop what you are doing and write down what you are thinking. Once you have taken a moment to slow down the negative momentum of your thoughts, you will be more rational and clear-headed in evaluating their veracity.


Avoid Asking “What If?”

“What if?” statements throw fuel on the fire of stress and worry, which are detrimental to reaching your goals. Things can go in a million different directions, and the more time you spend worrying about the possibilities, the less time you will spend taking action and staying productive.    Asking “what if?” will only take you to a place you do not want—or need—to go. Of course, scenario planning is a necessary and effective planning technique. The key distinction here is to recognize the difference between worry and strategic thinking about your future.images (18)


Schedule Exercise and Sleep images (19)

I cannot say enough about the importance of quality sleep. When you sleep your brain removes toxic proteins its neurons that are by-products of neural activity when you are awake. Unfortunately, your brain can remove them adequately only while you are asleep. So when you do not get enough sleep, the toxic proteins remain in your brain cells, wreaking havoc by impairing your ability to think—something no amount of caffeine can fix.

Your self-control, attention, and memory are all reduced when you do not get enough sleep—or the right kind—of sleep. Sleep deprivation raises stress hormone levels on its own, even without a stressor present, which are a major productivity killer. Ambition often makes you feel as if you must sacrifice sleep to stay productive, but sleep deprivation diminishes your productivity so much throughout the day that you are better off sleeping.

A study conducted at the Eastern Ontario Research Institute found that people who exercise twice a week for 10 weeks felt more competent socially, academically, and athletically. They also rated their body image and self-esteem higher. Best of all, rather than the physical changes in their bodies being responsible for the uptick in confidence, it was the immediate, endorphin-fueled positivity from exercise that made all the difference. Schedule your exercise to make certain it happens, or the days will just slip away.


imagesSeek Out Small Victories

Small victories can seem unimportant when you are really after something big, but small victories build new androgen receptors in the areas of the brain responsible for reward and motivation. This increase in testosterone, which further increases your confidence and your eagerness to tackle future challenges. When you have a series of small victories, the boost in your confidence can last for months.


Don’t Seek Perfection download (9)

Do not set perfection as your target. It does not exist. Human beings, by our very nature, are fallible. When perfection is your goal, you are always left with a nagging sense of failure that makes you want to give up or reduce your effort. You end up spending your time lamenting what you failed to accomplish and what you should have done differently instead of moving forward excited about what you have achieved and what you will accomplish in the future.


Focus on Solutionsdownload (10)

When you focus your attention determines your emotional state. When you fixate on the problems that you are facing, you created and prolong negative emotions which hinder your ability to reach your goals. When you focus on the actions you will take to better yourself and your circumstances, you created a sense of personal efficacy that produces positive emotions and improves performance.


Forgive Yourself ForgiveYourself

When you slip up, it is critical that you forgive yourself and move on. Do not ignore how the mistake makes you feel; just do not wallow in it. Instead, shift your attention to what you are going to do to improve yourself in the future.

Failure can erode your self-confidence and make it hard to believe you will achieve a better outcome in the future. Most of the time, failure results from taking risks and trying to achieve something that is not easy. Success lies in your ability to rise in the face of failure, and you cannot do this when you are living in the past. Anything worth achieving is going to require you to take some risks, and you cannot allow failure to stop you from believing in your ability to succeed. When you live in the past, that is exactly what happens, and your past becomes your present, preventing you from moving forward.


Bringing It All Together

I hope these lessons are as useful to you as they have been to me over the years. As I write them, I am reminded of their power and my desire to use them every day.


References:

http://www.take-your-power.com/importance-of-self-esteem.html

http://greatist.com/grow/sleep-in-or-morning-workout

http://stevemehta.com/blog/mental-toughness-success/

http://www.everydayhealth.com/low-testosterone/how-low-testosterone-can-erode-self-confidence.aspx

http://jamesclear.com/body-language-how-to-be-confident

http://philosiblog.com/2011/10/11/perfection-is-not-attainable-but-if-we-chase-perfection-we-can-catch-excellence/

http://www.psychologistanywhereanytime.com/emotional_problems_psychologist/psychologist_lack_of_confidence.htm

IMPORANT TIPS IN PRICING DECISIONS & COST MANAGEMENT

priceHow should managers use product cost information to price their products? There are two different approaches for pricing decisions:

  • THE MARKET-BASED APPROACH ASK: Given what our customers want and how competitors will react to what we do, what price should we change?
  • THE COST-BASED APPROACH ASK: Given what it costs us to make this product, what price should we change that will recoup our costs and achieve a target return on investment?

Markets and Pricing

Companies operate in different markets which affect the approach they will use for pricing:

  • Companies operating in COMPETITIVE MARKETS use the market-based approach. Companies in these markets must accept the prices set by the market (good or services provided by competitors are very similar)
  • Companies operating in LESS-COMPETITIVE MARKETS offer products or services that differ from each other and can use either the market-based or costs-based approach as the starting point for pricing decisions.
  • Remember, both approaches consider customers, competitors and costs. Only the starting points differ.
  • Managers should always keep in mind market forces regardless of which pricing approach they use.
  • Companies operating in markets that are NOT COMPETITIVE favor cost-based approaches because these companies do not need to respond or react to competitors’ prices.

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Understanding the Market Environment

Before setting prices under any approach, managers need to understand customers and competitors for three reasons:

  1. Lower-cost competitors continually restrain prices
  2. Products have shorter lives, which leaves some companies less time and opportunity to recover from pricing mistakes, loss of market share and loss of profitability.
  3. Customers are more knowledgeable because they have easy access to price and other information online and demand high-quality products at low prices

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Market-based Approach: Target Costing for Target Pricing

Starts with a target price which is the estimated price for a product or service that potential customers are willing to pay. The target price is estimated based on

  1. An understanding of customers’ perceived value for a product or service
  2. How competitors will price competing products or services

Implementing Target Pricing and Target Costing

There are five steps we follow to implement target pricing and target costing:

  1. Develop a product that satisfied the needs of potential customers
  2. Choose a target price
  3. Derive a target cost per unit by subtracting target operating income per unit from the target price
  4. Perform cost analysis
  5. Perform value engineering to achieve target cost

Value Engineering

Value engineering is a systematic evaluation of all aspects of the value chain, with the objective of reducing costs and achieving a quality level that satisfies customers. Value engineering entails improvements in product designs, changes in materials specifications and modifications in process methods. To implement value engineering, managers must distinguish value-added activities and costs from non-value-added activities and costs.

Here we have a graphical view of cost incurrence and locked-in costs

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The bottom curve plots the cumulative cost per unit incurred in difference business functions of the value chain. The top curve plots cumulative locked-in costs. Total cumulative cost per unit for both curves is $900 but as you can see, there is wide divergence between the locked-in costs and costs incurred.

Possible Undesirable Effects of Value Engineering and Target Costing

Unless managed properly, value engineering and target costing can have undesirable effects:

  1. Employees may feel frustrated if they fail to attain targets
  2. The cross-functional team may add too many features just to accommodate the different wishes of team members
  3. A product may be in development for a long time as the team repeatedly evaluates alternative designs
  4. Organizational conflicts may develop as the burden of cutting costs falls unequally on different business functions in the company’s value chain.

Avoid Possible Undesirable Effects

To avoid those possible undesirable effect, target-costing efforts should always:

  1. Encourage employee participation and celebrate small improvements toward achieving the target cost
  2. Focus on the customer
  3. Pay attention to schedules
  4. Set cost-cutting targets for all value-chain functions to encourage a culture of teamwork and cooperation

Antitrust Laws and Pricing Decisions

There are laws that impact our pricing decisions. Price discrimination is illegal if the intent is to lessen or prevent competition. Predatory pricing occurs when a company deliberately prices below its costs in an effort to drive competitors out of the market and restrict supply, then raise prices rather than enlarge demand.

References:

http://smallbusiness.chron.com/market-based-pricing-strategy-5121.html

https://www.boundless.com/business/textbooks/boundless-business-textbook/product-and-pricing-strategies-15/pricing-methods-93/cost-based-pricing-434-429/

http://www.economicsonline.co.uk/Competitive_markets/Competitive_markets.html

http://www.gktoday.in/understanding-marketing-environment/

http://www.imanet.org/docs/default-source/thought_leadership/management_control_systems/implementing_target_costing.pdf?sfvrsn=2

http://www.invest-in.org/invest/ve/index.php

https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/single-firm-conduct/predatory-or-below-cost

3 Concerns That Business Usually Deal With In Management

 “Business people who focus on profits wind up the hold. For me, profit is what happens when you do everything else right” (Chouinard)

I typically do not like analogies in business, but sometimes they do make such good sense. When reading this quote by Chouinard, I agree with this quote. How many times are we faced with decisions where “the right thing to do” may be a tough decision? I believe, the right thing to do is always the right decision. This is even more important in business, as the reputation with the customers is based on some level of trust. The trust comes from doing what is promised. The customer assumes they will get what they pay for. They also assume the company will stand behind whatever it is they sell them. Business people cannot go wrong by doing the right thing. In business, this might cause them a little more or take extra time up front. But the extra effort will pay dividends many times over. The best companies, and the people in those companies, have standards that cannot be compromised. This positively impacts both the customers and employees. Without profitability, there is no company. Every employee should understand how he or she fits into the profitability picture. Everyone’s common goal should be to build a strong, profitable company that will last.

What are the most persuasive arguments for, and against, Corporate Social Responsibility? What is the difference between a “legitimate operation” and a business that has lost its legitimacy in the eyes of its stakeholders? What actions can be taken to regain “legitimacy”?

Corporate social responsibility, also referred to as CSR, can be describing as embracing responsibility for a company’s actions and encouraging a positive impact through its activities on the environment, consumers, employees, communities, and other stakeholders. The most arguments both for and against CSR are based on how a company’s attempt to be socially responsible affect its bottom line. CSR argue for the recognition of a “triple bottom line” performance that includes not only financial returns for owners but also social and environmental benefits for the greater society. Legitimacy is an important corporate resource for a company as it embodies the trust its stakeholders have in it as an organization. The difference between a “legitimate operation” and a business that has lost its legitimacy is the view by public. A firm that has gained corporate legitimacy is seen by the public as operating according to the social norms, values and expectations guiding their community. To regain legitimacy, the corporate have to managed and/or repaired by organizational managers developing CSR activities, with strategic intent.

Why can’t you accept my ethics? Where did you get your ethical values, and what are some of the difficulties when an individual’s ethics confront/contradict the ethical values presented by the company?

Ethics is based on a set or moral and ethical values. These values must be absolute—people must take them seriously enough to override any human rationalization or personal faults. Unfortunately, life is not that easy and there’s always disagreement about what values should reign supreme. In the world of business ethics, employer helps company. Their values are the company’s values (in the context of work). The freedom to choose our own ethical values is somewhat limited. However, from the corporation’s perspective, manager must lead by example. Good ethics should be most noticeable at the top. Then every employee should be accountable to the same rules. Corporate values and ethics initiative must be sold and marketed throughout a company. Considering the rash of corporate scandals these days, the thought of following the corporation’s values might not be too comforting. The difficulties is whose or what values can we trust? Honesty. The old adage “honesty is the best policy” is true today and more than ever. You are either honest or not. Even if you haven not get caught yet, most people know who is and who is not. Another difficulties that an individual face with ethics is responsibility. Blaming others, claiming victimhood, or passing the buck may solve short-term crises, but refusal to take responsibility erodes respect and cohesion in an organization. Ethical people take responsibility for their actions. Likewise, actions show the ability to be responsible both in the little and big things.

References:

http://www.notjustforprofit.org/

http://ro.uow.edu.au/cgi/viewcontent.cgi?article=1062&context=aabfj

https://blogs.cfainstitute.org/investor/2013/10/21/confronting-ethical-dilemmas-at-work-why-do-good-people-do-bad-things/

5 Essential Skills for Success in Business

By: Jenny Nguyen

Date: October 15, 2015

There are 5 essential skills to the success of business. Here’s what you need to forge and develop if you really want to build the business. You have to learn them from the job and also by changing the working

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The first factor to mention is the ability to plan, organize and get some results. It is likely the most valuable and most paid remuneration. The ability to harvest the result of the work is also very important, therefore, you are responsible for the result of the company. Always cooperate, work hard, learn how to acquire the result for other employees and let them feel the great effect of training you before you actually bring in the result.

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The second factor is the ability to negotiate, the ability to sell your ideas when you persuade others people. Try to practice this, you can also take classes and become a sales expert. You can try to involve within the company by practice public speaking. You should remember effective communication skills make up 85% of your success.

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The third factor is that you know and choose the right people and right task to build an effective team. This is the ability to gather people to cooperate to work. In fact, this ability is seem to be a number one skill to have when you want to get promoted.

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For example, Lee Iacocca was promoted to be an executive director for Chrysler’s Company after he introduced 35 new deputy directors to gather all together under his control in the first 3 years of work in the company. The things he did and the reason why he get recruited is because he was capable of gathering those people into a winning team.

The fourth factor is that you need to have the capacity to negotiate, compromises. All successful entrepreneurs are gifted negotiator. They can compromise between conflicting interests, opposite of his colleagues, negotiate with bankers. They can also negotiate with service provider, customers and staff. You will need to become a great negotiator because obviously, you will always have to negotiate in the real world.

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Last but not least, the fifth factor is the knowledge of accounting, corporate finance and control expenditure fees. Surprisingly, there are many people has forged a successful business based on having great products, great services, and great sells, but then bogged into failure because they don’t understand clearly the financial aspects of business. They do not understanding anything about accounting.

You cannot be successful if they do not take the time to learn and understand about finance. With that knowledge, you can work for the banks, for the finance firm to be able to get a loan contract. It is extremely beneficial for you if you know how to read a financial statements and being able to explain them to others.

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Altogether, those are the five essential capabilities you can reap to be successful in business. The ability to harvest the results, the ability to communicate, the ability to choose the right task and people, the ability to negotiate and ability to understand finance. You can learn these things through direct training and practice on a job. What you cannot learn from the job, you can learn over time. When you at work, you get pay; you have the time, you have relationships with others, you also have experience as each day pass. So, let’s take every advantage you can while working to learn the things you need so that later you cope alone with the harsh market.

And here are two things you can do immediately to start develop the skill necessary to succeed in business:

First, take the time to think, plan and organize before you do anything. Have you heard of this formula before: plan ahead to avoid precisely the worst results.

Then, clarify with yourself that starting today, you will learn the necessary analysis skill in sales, negotiation and accounting to become an entrepreneur or a great manager.

References: 

http://www.interviewsuccessformula.com/job-search-advice/tips-on-how-to-prioritize-organize-and-plan-your-work.php

http://www.communicationskillsworld.com/

http://www.briantracy.com/blog/leadership-success/how-to-delegate-the-right-tasks-to-the-right-people-effective-management-skills-for-leadership-success/

https://www.ldsjobs.org/ers/ct/articles/effective-negotiation-skills?lang=eng

http://www.business.gov.au/business-topics/tax-finance-insurance/business-finances/Pages/improve-your-financial-knowledge.aspx

Benefits of Engagement between Managers and Employees

employee-engagement-strategies-conference-hub-14-638By: Jenny Nguyen

Date: October 14, 2015

It is tough for employees to meet performance goals when they do not know exactly what is expected of them.

And far too many employees fell into that category. Based on Engineers International work with companies worldwide, only about half of employees strongly agree that they do not know what is expected of them at work.

Helping employees to set and achieve goals is a manager’s key responsibility, but according to Harvard Business Review it shows that many managers don’t really own this task. To free employees to take initiative and inspire high performance, managers need to set clear expectations, hold employees accountable for meeting them and respond quickly when employees need support. But managers also should hold themselves accountable for meeting employee’s performance needs.

Inspiring Employee Performance

When it comes to knowing what’s expected of them, employees need more than a job description. They must know when they are performing well and when they are not. The best managers clarify expectations and support employees by helping them structure their work and prioritize their tasks. They help employees measure the difference they make and hold them accountable for their results. Additionally, they are available to answer employees’ questions and provide ongoing support, feedback and communication so that employees always know whether they are meeting expectations.

The Top Three Elements of Employee Performance

  • Performance Standards: Inspiring performance starts with establishing clear expectations and goals. Employees need clear direction from their managers on what is expected of them, how much and when

  • Leadership Training: After managers set expectations, they do not just walk away and hope for the best. They know the tasks and projects their employees are working on, hold them for accountable for meeting expectations and provide regular measurement of and feedback on their performance.

  • Compensation: To motivate achievement and accountability, the best managers are available whenever an employee needs support. They listen, and when an employee encounter a problem, they actively help him or her solve it. These managers are approachable and responsive.

These three elements have important effect on employee engagement, which plays a crucial role in helping companies grow. International Association of Business Communicators Research Foundation’s second Employee Engagement Survey in 2010measures engagement items that link to important business outcomes, such as improved productivity, profitability and customer ratings. It provides a clear picture of a company’s work environment and each manager’s success in meeting employee needs

Within the measurement and analyzing between performance standards, leadership training, and compensation and employee engagement, I found that the more successful a manager is at fulfilling employees’ needs on each of the three elements, the more likely employees are to be engaged.

Benefit of Engagement

Meeting employees’ needs is important to encouraging high performance. When managers help employees set work priorities and performance goals, they give employees more freedom in meeting these objectives, enabling them to take initiative and work autonomously. Employees also gain satisfaction from creating their work procedures themselves and from being involved in these decisions.

Employees who create their goals with their manager will follow through on them with more enthusiasm. If managers fail to meet employees’ needs or to involve them in setting expectations, employees are less likely to be engaged—and their companies are less likely to reap the benefits of engagement.

References:

http://engineers-international.com/33-31-33.php

https://hbr.org/2011/02/making-sure-your-employees-suc

http://smallbusiness.chron.com/key-elements-measuring-performance-25507.html

https://www.iabc.com/latest-research-highlights-employee-engagement-survey/

The Manager and Management Accounting

images (1)  By: Jenny Nguyen

                                                  Date: October 14, 2015

Managers at companies large and small must understand how revenues and cost behave or they risk losing control of the performance of their firms. Managers use cost accounting information to make decisions about research and development, budgeting, production planning, pricing, and the products or services to offer customers. Cost accounting provides information for both management and financial accounting professionals has its focus on the cost of acquiring or using resources in the organization. In Management Accounting, strategy play a vital role it decide the performance of the company. Strategy specifies how an organization matches its own capabilities with the opportunities in the market place. There are two broad strategies in the Management Accounting system called Cost leadership or product differentiation. Deciding between these two broad strategies is a critical part of what managers do. Management accountants work closely with managers in various departments to formulate strategies by providing information about the sources of competitive advantage, such as (1) their company’s cost, productivity or efficiency advantage relative to competitors or (2) the premium prices a company can charge relative to the costs of adding features that make its products or services distinctive.

Management accounting information helps managers formulate strategy by answering questions such as the following:

  1. Who are our most important customers, and how can we be completive and deliver value to them?

  2. What substitute products exist in the marketplace, and how do they differ from our own?

  3. What is our most critical capability?

  4. Will adequate cash be available to fund the strategy or will additional funds need to be raised?

Customers demand much more than just a fair price—they expect quality products delivery in a timely manner, therefore, creating value is an important part of planning and implementing strategy. Value is the usefulness a customer gains from a company’s product or service. The entire customer experience determines the value a customer derives from a product. In order to make delivery more effective companies have to follow the value chain. The Value chain is the sequence of business functions in which a product is made progressively more useful to customers.

The Value chain consists of: images

  1. Research and Development (generating and experimenting with ideas related to new products, services or processes)

  2. Design of Products and Processes (detailed planning, engineering and testing of product and processes)

  3. Production (procuring, transporting and storing, coordinating and assembling resources to produce a product or deliver a service)

  4. Marketing (promoting and selling products or services)

  5. Distribution (processing orders and shipping products or services to customers)

  6. Customer Service (providing after-sales service to customers)

Production and Distribution are the parts of the value chain associated with producing and delivering a product or service. These two functions together are known as the Supply-Chain. The Supply Chain describes the flow of goods, services and information from the initial sources of materials, services, and information to their delivery regardless of whether the activities occur in one organization or in multiple organizations. To increase efficiency in these areas, in other words to increase performance and reduce costs, suppliers may be asked to deliver small quantities of materials frequently instead of one larger shipment.

The key success factors to improve performance are shown below here:

Cost and efficiency – understanding the activities that causes costs to arise and managing them allows managers to react to the continuous pressure to reduce costs

Quality – customers expect high levels of quality

Time – two important dimensions of time are new-product development and customer-response time

Innovation – a constant flow of innovation products or services is the basis for the ongoing success of a company

Sustainability – the development and implementation of strategies to achieve long-term financial, social and environmental goals.

Overall, in order to compete in today’s competitive environment companies have had to become more customer-driven and make customer satisfaction an overriding priority. Customers are demanding ever-improving levels of service in cost, quality, reliability, delivery, and the choice of innovative new products.

References: 

http://www.investopedia.com/terms/c/cost-accounting.asp

http://www.srtmarketing.com.au/insights/cost-leadership-or-differential.html

http://www.businessnewsdaily.com/5678-value-chain-analysis.html

http://whatis.techtarget.com/definition/supply-chain

http://www.goodfellowpublishers.com/free_files/Chapter%2017-93d1f807b2100698453ada7add3a0568.pdf

What is Management? Why is it so hard to have good Management?

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By: Jenny Nguyen

September 29, 2015

Any management within an organization have similar responsibilities, such as planning, organizing, leading and controlling. However, the approach managers take will vary based on the type of organization. Managers for profit organizations focus on the system and production. They will motivate employees through bonuses for sales targets or profit sharing. In contrast, this strategy cannot work for a non-business organization. In those cases, management must either appeal to the employees’ sense of duty to the mission of the non-business organization. Whiles every organization poses different challenges, effective managers consider the type of organization and adjust their style to fit those circumstances. Most importantly, management should be studied in a very broad context. To remain competitive, organizations must efficiently and effectively create, locate, capture, and share their organization’s knowledge and expertise, and have the ability to bring that knowledge to bear on problems and opportunities. Firms are showing a tremendous interest in implementing knowledge management processes and technologies, and are even beginning to adopt knowledge management as part of their overall business strategy.

Essentially, the role of managers is to guide the organizations toward goal accomplishment. All organizations exists for certain purposes or goals, and managers are responsible for combining and using organizational resources to ensure that their organizations achieve their purpose. If the Management ensures that all the activities are designed effectively, the production of each individual worker will contribute to the attainment of the organization goals. So many companies developed management programs, and hundreds and thousands of people were encouraged to learn management on the job. And they did. But people were taught little about leadership. . Effective managers understand and spend great amount of time planning, organizing and leading than controlling to achieve organizational success.  

One of the most important decision companies make is simply whom they name management. Bad leadership cost businesses billions of dollars each year, and having too many of them can bring down a company. The only defense against this problem is a good offense. However, hire manager with great leadership based on talent will thrive and gain significant competitive advantage. One of the biggest problem that always challenges the leader is balancing the needs of the organization and the needs of people. Leaders cannot succeed for the long haul if they do not pay attention. Both needs are not always perfectly balanced, but if the leaders do not feel cared for and supported with necessary resources, they will not produce desired results. Another problem leaders may have is staying motivated. Leaders rarely last when they do not have a clear sense of their purpose. Low sense of purpose, low motivation. High sense of purpose, high motivation. Every leader can learn to engage a team somewhat. But without the raw natural talent to individualize, focus on each person’s needs and strengths, the day-to-day experience will burn out both the leader and his or her team. Experience and skills are important, but people’s talents—the naturally recurring patterns in the way they think, feel and behave—predict where they will perform at their best.

Reference:

  1. http://www.businessdictionary.com/definition/management.html
  2. https://www.boundless.com/management/textbooks/boundless-management-textbook/organizational-theory-3/evolving-organizations-32/the-role-of-the-manager-in-an-evolving-organization-184-5510/
  3. http://bensimonton.com/good-vs-bad-leadership/
  4. http://www.gallup.com/services/170912/talent-based-hiring.aspx