The theory of production and costs provides an analysis of how price signals should be translated into effective production decisions, so that not only are markets provided with what they demand but also production is by the least cost method.
Market and technology constraints are constraints that limit the amount of profit a firm can make. Most firms are in business to make the most profit possible bearing in mind these two constraints and they attempt to do so by maximizing output and/or minimizing cost. Firms, in wishing to alter their total product (i.e. the total quantity produced), are constrained by limited factors of production. In the short run they may be able to only alter one input, for example it may take several months or years to obtain a new machine that makes the production process more efficient, but in the meantime they can increase the amount of labour used. The new machine may come on stream in the long run, which is a period of time when all inputs can be varied. With increased labour and new machinery, production cannot go on increasing indefinitely and firms are subject to the law of diminishing returns. At Supervalu the production process is that every full time member of staff is assigned an section in the shop, e.g. Charlene does provisions. So on the Monday they know if they will need stock, that way the shelves are always full and there is as little in the back up as possible.
Market Research is the process of gathering information on potential customers. You will probably look at information that shows buying habits, lifestyles and perceptions of BOTH current and prospective customers. There are various types of research and these are:
Market - which concentrates on analysing the potential for those products/services you already produce, forecasting the possible demand for future products, forecasting sales, studying market trends, analysing market characteristics, looking for the reasons why companies have specific market shares.
Product - which concentrates on how customers/consumers will react to proposed new products or developments, comparing the strengths and weaknesses of competitive products, researching various forms of packaging and presentation, forecasting how current products will have to change to remain fresh with consumers, testing marketing plans.
Price - which concentrates on analysing price responsiveness (elasticity), looking at which products make a contribution to profits and how much, how customers view certain prices and 'price points', deciding how credit and the ways available for purchasing products affect consumer demand.
Some companies also research customer perception of sales and advertising campaigns and which forms of product distribution work best for certain products.
Remember Market Research involves BOTH Primary and Secondary data. The first refers to information that does not already exist. Its collection can therefore be expensive and time-consuming. However, it should be accurate and relevant to the business involved. The second refers to information that has already been collected. The data is comparatively cheap to acquire but might not be accurate or exactly that required by the business.
There are two types of research, which we call field and desk. The first, field research is based on the collation of primary data and therefore involves actually asking people or researching something new. It can take many forms, which include: surveys, observations, loyalty cards, panels and group discussions and market testing. Desk research concentrates on using data, which has already been collected. It can be collected by using information already held by the firm, using official information and records, asking for access to information stored by professional bodies and by searching publications such as newspapers. At Supervalu they try different techniques of recycling, people management and there is a complaints system at the tills.
Any efficient Human Resources department needs to integrate its departmental strategy to fall in line with the strategy of the rest of the organisation. The HRM function needs to communicate with other departments in order to ensure a streamlined.
Without which the staffing function becomes randomly inefficient and ineffective.
Is the development of a comprehensive staffing strategy that meets the organisations future human resources needs? When applied to management selection it ought to ensure recruitment of the right people for the right jobs at the right time. Rather than fill posts when they fall vacant, or a pressing need arises, efficient human resource planning needs to answer these questions.
1. Are the right numbers and type of people doing the things that need doing?
2. Are we using our human resources well?
3. Do we have the people we need to satisfy our future requirements?
Is maintaining a recruitment policy that guarantees a continuous supply of personnel in all areas of the business, that meets needs caused by retirement, resignations, promotions, maternity leave, business expansion or diversification across the organisation.
Is the appraisal of an employee’s performance in a way that ensures the output of an employee matches the expectations of the organisation? This requires a proactive approach to the appraisal of the employee, in order that agreed targets can be set and analysed on a pre-determined basis. Often this performance may be linked to pay structure and bonuses.
Once an employee is on a payroll, they must be included in a rolling programme of personal development in order to maintain their interest and motivation. The organisation needs to ensure that employees are able to meet the challenges of their role as the environment under goes changes, especially in areas such as competition, technology and product development.
The administration and support services are essential in keeping the wheels of a business turning. They include maintenance of the business premises and equipment, in-house printing, catering and computer services.
At Supervalu the objectives of their business helps them get to their business objective, and that is providing the local people with a supermarket which is convenient, close and most importantly aware of their customer satisfaction.