About the author Wilma Garvin graduated from the University of Westminster in Business Studies with French and Spanish. She then worked for several international businesses, including senior management roles in managing international operations which also covered foreign currency transactions. She had experience in commercial management in blue chip companies before moving into management consultancy and training. Wilma has a Masters in Business Administration and she did her dissertation on applying Western management techniques to enterprises in the Former Soviet Union. She works as a management consultant and has done projects for the Department of Trade & Industry, Business Link and a range of private sector companies. She speaks several languages and has carried out management projects in Russia, Eastern Europe and the Far East. Wilma has considerable international experience and has managed multi-cultural teams. Her role has included sensitive negotiations. She has undertaken a variety of research projects, including the use of e-learning in organisations and managing in cross-cultural environments. She has advised organisations on strategy and business planning and is also familiar with internet strategy development within organisations. Product Manager: Ruth West-Robinson 1st Edition 2004 Version 2 Learning Outcomes On completion of this Study Guide you will be able to:
Activities
Participating in the Dynamic Business Environment What is Management? The Dynamic Business Environment Making Ethical Decisions and Managing a Socially Responsible Business Competing in the Global Marketplace Summary
Management and Leadership in Todays Organisation World-Class Operations Management Understanding the Customer and Creating a Marketing Strategy Developing Quality Products at the Right Price Distributing Products in a Timely and Efficient Manner Using Integrated Marketing Communications to Promote Products
How to Use this Study Guide In Managing the Enterprise you will have two main sources of reference. The first is your textbook: Naylor J (2004) Management, 2nd Edition, Harlow, FT Prentice Hall This textbook has been chosen because it presents the information on management in an interesting and interactive way, and encourages a high level of student participation. There is also an online study skills resource which complements the textbook and this can be found at www.booksites.net/naylor. The second main source of reference is this Study Guide. This has been written to help you to develop your understanding of each topic. The Study Guide will start by previewing the topic, and highlighting the key points which you should learn. You will then be directed to the relevant pages in the textbook which you should read carefully. When you have read the textbook pages you should return to the Study Guide. The Guide will then help you to review what you have learnt through a series of activities, questions and key point summaries. In addition to the sources of reference mentioned above, there are many relevant websites where you can find additional information. Some sites you might like to visit are:
The following magazines might also be of interest: Management Today Harvard Business Review People Management Marketing Make a note of interesting websites, books or articles that you have seen that are relevant to the course content. You might also like to start a file to keep copies of these for future reference. Make notes of questions that you would like to ask the tutor or the learning support teams or other students. Activities Throughout this Study Guide, you will be required to complete a number of activities. These have been designed to reinforce the key points and to encourage you to apply your learning in a number of different ways. Some of the activities may only take a few moments whilst others are more demanding and will take much longer. Some require you to undertake some kind of practical activity, whilst others are more reflective and ask you to think about some of the concepts covered and relate them to your own experience. In either case, completing the activities will add a further dimension to your studies and enable you to make sense of the material presented to you by applying it to the real world and to your own frame of reference. Please note that some of the activites ask you about your company or organisation. This refers to a company or organisation that you are familiar with and not necessarily one that you are currently working for. In each case, there is an indication of the type of activity (e.g. reflective, practical, knowledge-based, etc.) and an approximate guide to the time it should take to complete. In addition to the activities throughout this Study Guide there are many more within the directed reading sections of your textbook and you are advised not to miss these out as they are an essential part of your learning. The companion website to the course reader also has a selection of multiple choice questions for each paragraph. Some of these have been included in the activities. You will get feedback on your responses from completing these multiple choice questions which will help to identify gaps in your understanding. You can then go back to the relevant chapter to review any gaps. Although there is no set response to the activities, some general feedback is provided at the end of the Study Guide. When you have completed an activity you should record the learning in your Personal Development Plan/Learning Log. Throughout the Study Guide, activities will be indicated by different icons a guide is provided on page 6.
In this section, the Business in its Environment, we are going to look at the legal forms of business and the legal requirements that they need to meet so that you are aware of some of the different forms that a business can take. Then, we shall look at the question of what management is and why it is needed. Naylor (2004) defines management as:
We shall explore the operating environment that encompasses the organisation, regulators, suppliers, investors, competitors, customers and distributors. This leads on to a PEST (Political, Environmental, Social and Technological) analysis and one of your activities will be to apply PEST to your own organisation. The section then moves on to stakeholders and an appreciation of the issues which stakeholders bring to an organisation. The next topic is an appreciation of the problems associated with making ethical decisions and managing a socially responsible business where ethics need to be defined and discussed: Ethics: A social, religious or civil code of behaviour considered correct, especially that of a particular group or profession. We shall look at corporate social responsibility and the impact that this has on marketing. The final topic in this section is Competing in the Global Marketplace. This looks at why companies investigate alternative markets and what market entry strategies are available to them. Also discussed are the strategies that organisations might adopt, i.e. standardisation, customisation, mixed or creation. It then goes on to discuss cultural factors and Hofstedes (1991) cultural dimensions of:
This section also looks at different approaches to time monochronic and polychronic. Participating in the Dynamic Business Environment Participating in a dynamic business environment means that companies need to understand what the operating environment is, and one way to do this is to carry out a PEST analysis. It is important to understand the legal forms for businesses. Legal Forms for Businesses Firstly, let us consider the types of legal forms that exist for businesses and the legal environment within which businesses operate in the United Kingdom. The simplest way to set up in business in the UK is as a sole trader. A sole trader takes on personal responsibility for the profits and losses of any business that they do. The United Kingdom has enjoyed a system of company registration since 1844. Today, company registration matters are dealt with in law by the Companies Act 1985 and the updating legislation contained in the Companies Act 1989. All limited companies in the UK are registered at Companies House, an Executive Agency of the Department of Trade and Industry. There are more than 1.8 million limited companies registered in Great Britain, and more than 300,000 new companies are incorporated each year. Why does Companies House need this information? In exchange for the benefits of trading with limited liability, companies must deliver certain information about themselves to the Registrar. He must then make this information available for inspection by the public so that they can make informed decisions about companies that they may wish to invest in or do business with. There are four main types of company:
Memorandum of Association This document sets out:
Other clauses to be included in the memorandum depend on the type of company being incorporated. The company's memorandum delivered to the Registrar must be signed by each subscriber in front of a witness who must attest the signature. Articles of Association This document sets out the rules for the running of the company's internal affairs. Registered Office This is the address of a company to which Companies House letters and reminders will be sent. The registered office can be anywhere in England and Wales (or Scotland if your company is registered there). The registered office must always be an effective address for delivering documents to the company and it is important that all correspondence sent to this address is dealt with promptly. If a company changes its registered office address after incorporation, the new address must be notified to Companies House. Companies House uses the Post Office address file to verify addresses. Being a Company Director In general terms, anyone can be a company director but there are some rules. You can't be a company director if:
There is no minimum age limit in the Companies Act for a director to be appointed in England and Wales. However, he or she must be able to consent to their own appointment. A Public Limited Company (plc) A public limited company is a company which is registered as such and complies with the following:
The advantage of a public company is that it has access to capital markets and can offer its shares for sale to the public through a recognised stock exchange. It can also advertise any of its securities for sale to the public. In contrast, a private company may not offer to the public any shares in itself. What Information Does Companies House Require? Company directors have a personal responsibility for making information about the capital structure, management and activities of their companies available both to the members of the company and to the general public. For companies with limited liability, this will include accounts. If your company is unlimited, accounts must be delivered to the Registrar if:
Limited Liability Partnerships A Limited Liability Partnership (LLP) shares many of the features of a normal partnership but it also offers reduced personal responsibility for business debts. Unlike members of ordinary partnerships, the LLP itself is responsible for any debts that it runs up, not the individual partner.
What is Management? To answer this question, it is important to look at the functions that managers perform in an organisation. These are:
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