3. Chapter 1 / Hoofstuk 1 Introduction to Business Management: a value chain perspective Inleiding tot Ondernemings Bestuur: ‘n waardeketting perspektief
4. Isolation? / Isolasie? Our world is characterised by various types of business activities Business Management is relevant to all people – not only “business people” Business Management includes all activities related to the management of all types of businesses Management specific mode of thinking Achievement of a set of goals and objectives by utilising the resources available to the organisation. Introduction:
5. Business = System (Sisteem) 4 Functional Areas (Funksioneel) 4 Generic FX (Generies)
6. Functional areas of Business Management Purchasing and materials management Production and operations management Marketing management Financial management Most businesses have various departments, each with a specific job or task = functions
7. Generic management functions General management Human resources management Corporate communication management E-management All management functions should work together to achieve the goals of the business.
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9. Business activities are driven by the satisfaction of human needs. Needs spiral Unsatisfied needs = opportunity Driving force for human action Business Climate
10. Maslow’s hierarchy of needs theory = higher order needs (“nice to have”) = Self-actualisation needs of fulfilling potential Esteem needs of respect Social needs of belonging Safety needs of security Physiological needs of human existence = basic needs (“must have”) = not mutually exclusive When a need is satisfied it no long influences behavior.
11. Problem with needs = means Various needs exist at one point in time Prioritise Priorities is subjective (eye of the beholder) Order can change within broader categories of hierarchy
12. ECONOMIC PRINCIPLE to gain maximum satisfaction with minimum effort satisfy maximum needs with min need satisfying resources the fundamental basis for economic activity the basis of productivity issues max output (RESULTS) with min input (RESOURCES) ALL BUSINESS CONSIDERATIONS SHOULD BE BASED ON THIS ECONOMIC PRINCIPLE.
13. The provision of goods and services to satisfy the needs of customers = basis of economic activity Conversion of various inputs into need satisfying outputs
14. Inputs Production factors 4 types: Land (all natural recourses – raw material) Capital (financial means for acquiring other inputs) Labour / Human Capital Entrepreneurship (Innovation of putting together production factors) Integrated System
15. Needs and need-satisfiers Unlimited needs and wants Limited resources to create need-satisfiers Universal drive for need satisfaction gives stimulus for business ventures Scarcity/inability to efficiently utilise resources
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17. What is the purpose of BB-BEE? Transformation of the South African society through growth of the Black Middle Class - Broader tax base Broader consumer base Phenomenon of “ownership” Attract FDI
30. Objectives for business organisations Profitability Growth Market shares Social responsibility Well-being of employees Product quality Service levels Why does 2/3 SA businesses fail in the first 2 years?
31. Need satisfaction institutions in the free market system Business organisations (Purpose to make profit) Government organisations (Serve the people) Non-profit-seeking organisations (Intent is not to make profit)
49. Production Functions Land & Natural Resources Capital (Financial Means) Labour (Physical & Mental) Entrepreneurship (Creativity) ProduksieFaktore
50. Inputs Raw Materials Human Resources Financial Resources Information (Know how) Machinery Technology Insette
51. Business addsValue by using its RESOURcESduring its PROCESSES Resources: Those inputs that a business converts to create a output Financial Resources (Cash or easily convertible) Operating Resources (Enablers) Human Resources Besigheidvoegwaardetoe deursyHULPBRONNEtegebruikgedurendesyProsesse
67. Client is willing to pay moreCOST KOSTE OUTPUT VALUE UITSET WAARDE COST: Making a product for cheaper, without changing the quality of your output. VERHOOGING vanWaarde
68. Adding competitive value Internal Intern environment business besigheid omgewing Toevoeging van KompetatiweWaarde
69. Porter: Value Chain Internal Unique Process Interne UniekeProssese Activity Aktiwietyd Porter: Waardeketting
70. Adding competitive value Process / Proses environment business besigheid omgewing Toevoeging van KompetatiweWaarde
71. Process Efficient Production System Cheap Raw Material CUSTOMER PERSIEVED VALUE Effective Marketing Expensive Labour Proses
78. Procurement & Inbound Logistics Sourcing Receiving Storing Handling Transporting within organisation Time Utility Form Utility Porter Primary Functions: Porter PrimereFunksies: Soek Ontvang Storteer Handteer Vervoerbinne in die organisasie Place Utility Aankope in InwaardseLogistiek
79. Production & Operations Production of Goods Technical core: Where service support activities are carried out Form Utility Porter Primary Functions: Porter PrimereFunksies: Producksie van goedere Tegniese Kern: Waar die ondersteundediensfunksiesuitgevoer word Produksie & Opperasies
80. Outbound Logistics Transporting & distributing to final customer Time Utility Form Utility Porter Primary Functions: Porter PrimereFunksies: Vervoer & distribusiena finale klient Place Utility UitwaardseLogistiek
81. Marketing & Sales Analysis of needs & wants Brings products & services to attention of customer Enable to buy (take possetion) Possession Utility Porter Primary Functions: Porter PrimereFunksies: Analiese van behoeftes & begeertes Bring goedere en diensteonder die aandag van klient Maakeienerskapmoontlik Bemarking & Verkope
82. Customer Service After sales service Exchanges Repairs Reverse Logistics Porter Primary Functions: Porter PrimereFunksies: Na VerkopeDiens Omruil Regmaak Omgekeerdelogisiek KlienteDiens
88. Financial management All activities, cost, assets related to the acquisition, utilization and the control of the MONEY a company requires to finance is activities Porter Support Functions: Porter OndersteuningsFunksies: Alleaktiwieteite,kostes, bates verwantaan die aankoop, gebruik en beheer van die GED wat ‘n besigheidnodig het omsyaktiwieteitetebefonds. FinansieleBestuur
89. HR management All activities, cost, assets related to recruitment, hiring, training, development and compensation of ALL types of personnel and labour relations activities. Porter Support Functions: Porter OndersteuningsFunksies: Alleaktiwieteite,kostes, bates verwantaan die opsoor, aanstel, opleiding, ontwikkeling en vergoeding van ALLE soortepersoneel en WN verhoudingsaktiviteite. MB Bestuur
90. Communications All activities, cost, assets related to internal and external communication Porter Support Functions: Porter OndersteuningsFunksies: Alleaktiwieteite,kostes, bates verwantaan interne en externekomunikasie Komunikasie
91. Information Management & E-Business The application of all management principles in managing a e-business Porter Support Functions: Porter OndersteuningsFunksies: Die aanvending van allebestuurswaardes in die bestuur van e-besigheid. InformsieBestuur & E-besigheid
92. Porter: Value Chain environment Porter Primary Functions: Procurement & Inbound Logistics Production & Operations Outbound Logistics Marketing & Sales Customer Service General Management & Leadership (Plan, direct, control) Value extraction Entrepreneurial Process Start-up Porter Support Functions: Financial management HR management Communication Information Management & E-Business omgewing
95. tHE SUPPLY CHAIN All activities from RAW MATERIAL to END USER Raw Material Rou Materiaal Distributors: Wholesale Retail Verspreiders: Groothandellaar Kleinhandelaar Customer Klient NO LONGER INDV FRIM THAT COMPETE BUT ENTIRE SUPPLY CHAIN Manufacturer Vervaardiger Alleaktiwieteite van ROU MATERIAAL tot eindgebruiker dIEvERSKAFFINGSkETTING
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97. Where can I add additional value?So that I can create a competitive advantage! Verstaanjouverskaffingsketting: Waar word waardetoegevoeg/ verloor? Waarkanekadditionelewaardetoevoeg?
