Initiative keeps our company vital, dynamic and competitive, which enables decision-making that is close to the market. When we take the initiative we originate new ideas to address the common challenges that face our entire company and the specific challenges that face our teams. We use our judgement and remind ourselves to think independently and also encourage independent thinking and self-reliance in others.
Mission statement
To provide essential products that improves the quality of everyday life.
Our mission statement states the companies overall aim and purpose, then translates this into corporate objectives. Corporate objectives become measurable when developed into more detailed functional, objectives, which are expanded into individual objectives for our employees to achieve. Achievement can be measured through appraisal of individuals and by adopting a management by objectives approach.
A mission statement should be a declaration of our organisations fundamental purpose, why we exists, how we see our self, what we wish to do, our beliefs and our long-term aspirations. Rodger Bennett believes the mission statements advantages and disadvantages are. -
Advantages
- “Encourages top management to adopt a strategic vision derived from a coherent philosophy concerning what the business is about, where it is headed and what it needs to do to get where it wants to be.
- Acts as a corporate constitution against which the firm’s behaviour may be evaluated.
- Presents the firm and its employees with the challenge of attaining the mission, hence facilitating the implication of change.
- Enables total company resources to be allocated according to the priorities explicit in the organisations mission.
Disadvantages
- Mission statements can be vague as to be meaningless. Imprecision invites conflicting interpretations and lack of understanding.
- Practical operational benefits resulting from mission statements may be difficult to identify.
- Departmental boundaries and interests often inhibit the adoption by all individuals and sections of a uniform view on the firm’s basic goals and values.
- Staff changes, poor vertical communications within organisations and disinterest among employees frequently result in the majority of firm’s workers not even knowing that the company has a mission statement let alone its contents.
- Companies with well-published mission statements sometimes take and implement decisions that are inconsistent with the contents of the statement and in so doing bring the entire concept into disrepute. Individuals and departments might pursue their own interests independently losing sight of the need to relate decisions to the organisations overall mission.
- The common pursuit of a clearly defined mission by all employees might inhibit their creativity and responsiveness to changing environments.
- Arguably today’s business world is altering so rapidly and extensively that no statement of mission can be relevant for more than a very short period, so why bother drafting a mission statement. In ferociously competitive situation the need to take decisions at odds with a company’s mission might be inevitable. Blind adherence to a pre-existing mission could guarantee failure.
- Mission statements need to be followed up by the development of strategies and plans for their implementation. Failure to devise action plans means the effort devoted to formulating the mission will have been wasted and can lead to cynicism and disillusion.”(REF3)
Although Rodger Bennett’s disadvantages seem a bit strong, it does make a point of that it is essential to translate a mission statement into objectives to all stake holders.
Our mission, vision and core values
My company operates in many countries. We compete in several complex markets to provide a vast array of products and services to very different groups of customers. But as diverse as we are, we are still one company, with one common set of goals and aspirations, and to reach them, we must work together. There are three important tools to help us do those: our mission, our vision and our core values.These tools are something that we hold in common; no matter where we work in our company and no matter where we work in the world. They bind us together. They make it easier to build a stronger corporate brand, and they remind us that we are part of one.
Why we do it
Our mission is to provide essential products that improve the quality of every day life. We create a wide range of products, services and solutions that are essential to the daily lives of people in all walks of life, in diverse communities around the world. Our offer includes such important environmental machinery such as our flocculation machines that keep our drinking water clean.
Where we are going
Our vision is the image we create today of what our company will become tomorrow and to be recognized as the leading provider of value, for customers, employees and all stakeholders in our field. We will never tire of our commitment to being the best. We will continuously strive to create more value, to achieve greater results and to make a positive contribution to industry where our people, products, solutions or services can be found. As always we will remain at the forefront of sustainable development and will continue to conduct all of our activates in accordance with the highest economic, social and environmental standards.
Our stated values and objectives are transmitted to employees, the public and stakeholders via our mission and core values. There are a number of methods currently in use.
Internet
The company website reflects the core values and can be accessed by staff, public and stakeholders at any time. I feel that mostly the public and stakeholders rather than the staff uses this method; therefore we acknowledge that other methods must by available to reinforce values and objectives internally.
Artwork on worldwide exhibitions
All of our agents abroad display the core values and objectives during worldwide exhibitions, these are an integral part of the Artwork that is on show to perspective customers, and as a result, this method highlights the values and objectives to the staff and introduces them to the public.
Mail shots
Our company literature is mailed to customers and perspective customers and again the core values of the company are communicated within the documentation.
Company notice boards
This is used as our main transmission method within the internal organisation. As we hold regular action planning meetings the core values and objectives are displayed on the meeting room walls. These meetings are used by the Managing Director to update the staff on sales to date, respective sales etc the core values and objectives are an integral part of these meetings. Minutes from these meetings are circulated amongst staff and the objectives and values are documented within the text. The aim of this is to reiterate them to staff.
A future development will be to reflect the company’s values and objectives within the staff’s Personal performance review so that staff can be measured against them.
- Identify your organisations stakeholders and briefly explain their interest in your organisation.
A stakeholder has been defined as:” Any group or individual who can affect or be affected by the achievement of an organisation’s objectives.” (Ref4)
There are many groups of people who have an interest, financial or otherwise, in the performance of our business. These different groups are known as stakeholders. The main stakeholders are considered to be:
Shareholders
Our company is a private limited company and only has two shareholders, the Managing Director and his Partner. These people have a clear financial interest in the performance of the business. They have invested money into the company and they expect the company to grow and prosper so that they receive a healthy return on their investment. The return that they receive can come in two forms. The company may grow in value and secondly they can issue them selves dividend payments as well as drawing a wage.
Employees
We also have an obvious financial interest in the company, since our pay levels and job security will depend on the performance and the profitability of the business. It is employees who perform the basic functions and tasks of the business (producing output, meeting deadlines and delivery dates, etc.) and over recent years our traditional role has started to change. We are often now encouraged to become involved in multi-skilled team working, problem solving and decision making – thus having a significant input to the workings of the business.
Customers
Customers are vital to the survival of any business, since they purchase the goods and services, which provide the business with the majority of our revenue. It is therefore vital for our business to find out exactly what the needs of the consumers are, and to produce our output to directly satisfy these needs - this is done through market research. The goods and services must then be promoted in such a way as to appeal to the target market and to inform them of the availability, price, etc. Once the customer has purchased the goods and services, it is essential that after-sales service is offered and that the customer is happy with his/her purchase. Our business tries to keep the customer loyal so that they return in the future and become a repeat-purchaser.
Suppliers
Without flexible and reliable suppliers, the business could not guarantee that we will always have sufficient high quality raw materials, which we require to produce our output. It is important for the business to maintain good relationships with our suppliers, so that raw materials and components can be ordered and delivered at short notice, and also so that the business can negotiate good credit terms from the suppliers (i.e. buy now, pay at a later date).
The government
The government affects the workings of the businesses in many ways:
- The business has to pay a variety of taxes to central and local government, including Corporation tax on our profits, Value-Added Tax (V.A.T) on the sales, and Business Rates to the local council for the provision of local services.
- The business also has to adhere to a wide-ranging amount of legislation, which is aimed at protecting the consumers, the employees and the local environment from business activity.
- We are affected by different economic policies, (for example, if interest rates are increased, then this will discourage us from borrowing money since the repayments will now be significantly higher). However, we can also benefit from government incentives and initiatives, such as new infrastructure, job creation schemes and business relocation packages, offering cheap rent, rates and low-interest loans.
Local community
The company provides employment for the local community and often will produce and sell some of our output to the local business. The sponsorship of local events and good causes (such as local charity work) can also help the business to establish itself in the community as a caring, socially responsible organisation. We develop links with local schools and colleges, offering sponsorships and resources to these under-funded institutions. However in some other businesses these can also cause many problems in local communities, such as congestion, pollution and noise, and these negative externalities may often outweigh the benefits that the businesses bring to the community.
Disagreements between stake holders
Due to the demands placed on businesses by so many different stakeholders, it is no surprise that there are often disagreements and conflict between the different groups. Some of the more common areas of conflict are:
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Directors and senior management. Profit maximisation is often the over-riding objective resulting in large dividend payments for the directors. However, it is far more likely that managers will aim to profit satisfy rather than profit maximise (that is, we aim to earn a satisfactory level of profits, and then use the remaining resources to pursue other objectives such as diversification and growth). This conflict between these two groups is often referred to as divorce of ownership (the directors) and control (the management).
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Customers are unlikely to remain loyal and repeat purchase from the business, if the product that the have purchased is of poor quality and or is poor value for money. More customers are prepared to complain about the quality of products and after-sales service than ever before, and we must ensure that we have in place a number of strategies designed to satisfy the disgruntled customer.
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Suppliers are often quoted as complaining about the lack of prompt payments from us for deliveries of raw materials, and if this became a regular problem then the suppliers may well refuse credit to the business or may even cease all dealings with us. On the other hand, we have been known to complain about the late deliveries of raw materials and components from suppliers, and the dubious quality of the parts once they have been inspected.
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The community and the business can often suffer at the hands of a large company through the negative externalities of pollution, noise, congestion and the building of new factories in areas of outstanding beauty. However, if the business faces strong protests from residents and from pressure groups concerned about its actions, then it may decide to relocate to another area, causing much unemployment and a fall in investment in the community it leaves behind.
- Who and for what reasons, do you identify as being your customers, at overall organisational level and within your personal area of operation?
Customer satisfaction and loyalty should now be regarded by our organisation and other organisations as key measures of business performance, and customer retention management is a critical indicator of medium-long term corporate health.
Once the critical drivers of customer satisfaction have been established and prioritised, we should build this into a research programme to and loyalty. Measures can be taken monthly, quarterly, bi-annually or annually, depending on the product and sales cycle and the needs of each client.
Surveys can be conducted by telephone, online, by post, face-to-face or a combination of all three. Reporting can be made simple, user-friendly, prompt, and can recommend that it reflect the organisations structure to ensure that each manager gets the data that is most relevant. Action Planning Clinics can also assist to help the operational teams understand the results and plan improvements.
With in my area customers can be identified and separated into two separate groups as external and internal customers.
Internal customers
These are the separate departments with in the firm that forms a chain of events from buying raw materials to delivering the finished product. If at any stage the chain is broken then the products will not meet the required standard for the external customers.
Electronics department
“Electronic circuits provide different functions to process information, either in analogue or digital form. Analogue functions include amplification of weak signals to a usable level; generation of radio waves; extraction of information, such as the recovery of an audio signal from a radio wave (demodulation); and control, such as the superimposition of an audio signal on to radio waves (modulation). Digital functions include the coding, storage, and transmission of information-bearing signals in binary form, and the logic operations.” (REF5)
In order for the electronic department to proceed with there work, they require the machinery to be built and coordinated with them.
Research and design
Change in society, markets, economies and society has led to a shortening of life cycles and this has intensified the need for most organisations and us to innovate in terms of the products we offer. New products can provide the mechanism whereby further growth can take place. Increasing competition, often itself coming from new or modified products means that innovation is frequently not an option but necessity. I am a direct link to the research and development department and I’ am required to authenticate the fabrication side of any development work and ensure this is feasible to put any ideas into production.
Sales staff
Sales Promotion is the element of the marketing process that can close the sale our goods or services to potential customer by providing the incentive to buy. Sales promotion, advertising, and salesmanship are the major techniques used in merchandising our products to the public. Salesmanship often takes the form of a face-to-face encounter between the buyer and seller; the presentation is set up to convince customers that the product on sale is essential to their satisfaction. The lack of personal feedback between buyer and seller is sometimes considered a drawback of the advertising approach. Selling by telephone, although it is significantly less effective than personal selling, we still considered an important method of merchandising. I work closely to our sales team ensuring specification and time scales are as sold to the purchasers.
Fabrication staff
These are staff directly working for my self. In return for wages terms and conditions they provide there time, expertise and knowledge.
External customers
We design and manufacture ultrasonic cleaning systems to the printing, engineering and electronics sectors (amongst many others) worldwide, serving many industries with countless applications and specific requirements. Our systems and services include anilox roll and gravure cylinder cleaning, (types of printing applicators) industrial parts washing, de-greasing, surface finishing and PCB cleaning (electrical parts). Through close co-operation, we also have developed a system to clean the blanket wash module (ink tray in a printing press) as used in the Heidelberg, Man Roland, (types of print press) plus several other lithographic presses. A range of additional and complimentary systems enables the cleaning of general parts, with the major benefit of being able to flocculate the waste ink /paint /varnish-laden water for re-use or more environmentally friendly disposal. With this in mind our targeted customers are in industry with that type of requirements.
New sales
The new sales come from the sales staff and then in turn go down the chain of events that leads to the manufacture in the fabrication side. Careful coordination ensures the new sales customers receive what they pay for.
Consumable sales
Certain parts of the machinery we sell has consumables such as chemicals, filters belts ext. Part of my roll is the ordering of these items along with materials for new build work. This gives me greater bargaining power with suppliers and enhances economies of scale and supplier loyalty.
Repair and warranty
Work regularly comes in that has been damaged or on occasion has a fault on a certain part that requires changing. The type of machinery we manufacture is ultra sonic and this effect often creates natural wear on machine parts over a period of time resulting in these parts being manufactured for replacement.
The table below shows the factors affecting external customer driven quality and the operating characteristics of our company.
- In what ways do the planning procedures that operate in your area of management, cater for your customer needs?
Our company is product led, which is the manufacture is concentrated on our product rather than market led, which is a firm looking through the eyes of its customers. This basis of the marketing concept is that the customer is seen as the start of the business cycle rather than at the end.
We look at the four p and our product matrix when considering our customers needs.
Product
As with most businesses we try to change our product portfolio over time. This can be the result of changing consumer tastes, replacing those products that have entered the ‘decline’ phase of the product life cycle or to try to break into new markets or new segments within an existing product. There are generally considered to be a number of stages in the development of new products:
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The generation of ideas. A number of issues need to be considered, such as will the new product meet the objectives of the business? Does the business have the spare capacity to produce the product? Will the new product contribute to the continued growth of the business? Will new personnel be required, or will the business have to re-train the existing staff?
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Testing the new concept. Is there a sufficient market for the new product? This stage of the product development process will involve carrying out extensive primary market research to test consumers’ reactions to the suggested product. Consumers may suggest slight alterations and modifications to the suggested product in order to make it more marketable and desirable.
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Analysing the costs/revenues. What will be the costs of production? How many units will the business be able to produce? What will the selling price be set at? What will be the profitability of the new product?
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Developing a prototype. The design, materials, quality and safety of the product will now become paramount. A prototype of the product will be developed using the details that the market research indicated that consumers wanted. It is essential to ensure that this stage of the development process is detailed and extensive, since to make alterations and modifications at a later date will be extremely expensive and time-consuming.
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Test marketing the new product. We may decide to test market the new product in a small geographic area, in order to test consumer response, before it launches the product nationally. If the consumer response is favourable, then the product is likely to be launched nationally. However, if the consumers indicate that some element of the marketing mix is ineffective (price, packaging, advertising, etc) then this is likely to be changed before the national launch of the product.
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National launch. This is where the product enters the ‘Introductory’ stage of its product life cycle. This is a very costly operation, since a national launch needs to be supported by extensive advertising and promotional campaigns.
Price
There are many considerations that we will need to take into account before it decides upon a selling price for a new product, such as:
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The objectives of the business – if the main objective of the business is to maximise profit, then it is likely that the product will be priced at a high level.
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The degree of competition in the industry – the number of competitors in the industry will affect the price level that we decide.
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The channels of distribution – the more intermediaries that are used in getting the product from the factory to the consumer, then the higher the selling price is likely to be specially as we have agents around the world.
There are many methods and strategies that we use in order to arrive at a selling price for our products:
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Cost-plus pricing. This is where the cost of producing each unit is calculated, and then a percentage profit is added to this unit cost to arrive at the selling price.
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Mark-up pricing. This is where we could add a profit mark-up to the direct cost for each unit in order to arrive at the selling price. This profit mark-up will need to cover the fixed overheads and then contribute towards profit.
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Predatory pricing. This method of pricing involves us assessing how much the completion charge then under cutting that price to win the sale.
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Skimming pricing. This is a pricing strategy for a new product, designed to create an up-market, expensive image by setting the price at a very high level. It is a strategy often used for new, innovative or high-tech. products, or those, which have high production costs, which need recouping quickly.
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Penetration pricing. This is a pricing strategy for a new product, designed to undercut existing competitors and discourage potential new rivals from entering the market. The price of the product is set at a low level in order to build up a large market share and a high degree of brand loyalty. The price may be raised over time, as the product builds up a strong brand-loyalty.
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Demand-orientated pricing. This method of pricing involves setting the price of the product at a level based upon customers’ perceptions of the quality and value of the product.
Promotion
Promotion refers to the tactics that we use to make consumers aware of our product(s) and to entice them to purchase the products.
Advertising is the most expensive of all the promotional activities undertaken. It can be carried out on television, on posters, in newspapers, in magazines, and on the Internet. Advertising can allow the business to easily reach a vast audience, to have a great impact on consumers and to reinforce other types of promotion that it is carrying out (e.g. competitions).
Place
This refers to were our factory is situated and the channels of distribution that we use in order to get our products to the customer. The channels of distribution refer to the intermediaries that we use to transport our product and make it available to the customers. The more intermediaries that exist in the distribution of a product from our factory to the customer, then the higher the final price of the product, since each intermediary will add on a profit margin in return for offering their services. Some products need to have minimum handling and travelling time, in order to minimise the risk of damage to the products.
The trend over recent years has been for us to eliminate as many of the intermediaries in the distribution channel, and for the product(s) to be sold directly from the factory to the customers themselves. This reduces the final price of the product that the customer has to pay and it also speeds up the delivery and the distribution process. These developments are enabling the larger businesses to dominate markets and hold a significant percentage of the overall market share. These retail outlets can, therefore, exercise more power than ever before when buying stock from factories and warehouses – enabling them to dictate the prices that they will pay for their supplies. The factory providing them with their stock and supplies will have little alternative than providing the supplies at a low price, since they cannot afford to lose such a large and important clients.
References and Bibliography
- Ref 1. ORGANISATION STRUCTURES &
PROCESSES (1997) JON
SUTHERLAND & DIANE CANWELL.
- Ref 2. MARKS AND SPENCER PLC ANNUAL
REVIEW 1999
- Ref 3. ORGANISATIONAL BEHAVIUOUR
(1997) ROGER BENNETT
- Ref 4. BUSINESS STRATEREGY (2002) DAVID
CAMPBELL, GEORGE STONEHOUSE,
BILL HOUSTON
- Ref 5. MICROSOFT ® ENCARTA ®
ENCYCLOPIDIA
2003. © 1993-2002 MICROSOFT
CORPORATION.
- THE COMPLETE GUILD TO CUSTOMER SERVICE. (1989) LASH L
- THE CHANGE MAKERS. (1985) COOPER C & HINGLEY
- BUSINESS STUDIES. (2000) FLOYD D
- ORGANISATIONAL BEHAVIOUR. (1995) COLE G A
