* Mini Case (p. 45) a) Why is corporate finance important to all managers? All managers are mandated with a goal to improve the businesses bottom line. Successful corporations have two main goals they must meet to stay in business. The first goal is “identifying, creating, and delivering highly valued products and services to its customers.” (Brigham) The second goal is to generate “enough cash to compensate the investors who provided the necessary capital.” Behind every managerial action, the manager must ally every action they take with meeting the above two goals. In order to evaluate the success of those decisions, managers must be able to analyze their decisions and fully understand the impact past decisions will have on the past, present, and future health of the company.
Costco’s mission, business model and strategy integrate efficiently to form a business model that many companies have since mimicked in hopes of duplicating their success. Costco’s mission statement is, “To continually provide our customers with quality goods and services at the lowest possible prices”. Three top executives offered a more expansive view of their mission in their 2011 Annual Report, “The company will continue to pursue its mission of bringing the highest quality goods and services to market at the lowest possible prices while providing excellent service and adhering to a strict code of ethics that includes taking care of our employees and members, respecting our suppliers, rewarding our shareholders, and seeking to be responsible corporate citizens and environmental stewards in our operations around the world.” (Thompson, A., Peteraf, M.A., Gamble, J.E., Strickland III, A.J., (2014), Crafting and Executing Strategy). This mission is firmly supported through company
We live in a world in which 13 of the top 50 economies are companies, not countries. Multinational corporations (MNCs) play a big role in providing social needs. A lot of these companies are richer than some developing countries. These companies have been responsible for creating job opportunites, boosting the economy and creating a better soucer of living for the citizens of these countries. “The vast numbers of MNCs are located all around the world; they vary widely in size and interest.
Current Operating Strategy and its impact There are a few of components of Hill Country’s operating strategy. The first one is that the simple and clear goal of the entire especially board of management is to maximize shareholder value. Meanwhile, the one-sixth of the shares that held by the CEO and management insiders can be regarded as a stimulation to develop management. The second component should be the efficient operations, lean and aggressive operating and capital budgets, and tight cost controls in this highly competitive industry. The third one could be the managerial philosophy of caution and risk aversion, especially to the decision-making process like introducing new products into market.
Individual financial rewards are given if the entire team completes the presentation to the company’s satisfaction and before the due date. This concept varies from the common individual-based compensation strategy that many firms employ. Individual-based compensation, as defined by Martocchio, rewards employees for meeting such work-related performance standards as quality, productivity, customer satisfaction, or other relevant factors. Team-based compensation is adopted by businesses for many reasons. For a business that struggles with collaboration morale, it can help incentivize group work.
Economic Goals of Business and Government VS Social Goals of Consumers Milton Friedman suggests that the social responsibility of a business is to increase its profits (Boardman, Sandomir and Sondak 221). While increasing profits is certainly one of the most important factors in a successful business, is it considered a social responsibility, or better yet, the only social responsibility of a corporation? Friedman seems to think so. But why is increasing profits a corporation’s social responsibility? According to Friedman, “A corporate executive is an employee of the owners of the business.
MAN 6721 – Business Policy and Strategy Instructor: Dr. LaQuita Gray-Baker Week 3: Individual Assignment February 16, 2013 Comparing and Contrasting the Five Generic Strategies Nadine Patterson Everest University Online Abstract After reading Chapter 5 concerning the different strategies used by companies in competition with each other There will be a comparison explaining how the strategies are similar and a contrasting explain how they are different from each other, and in what situations each strategy works best. Real-world examples will be used with explanations of why the strategy chosen by a particular company works for that company. Reference The five generic strategies are low-cost provider which attracts numerous amounts of customers by selling goods and services lower than the competition. Broad distinction means that the goods and services have what the competition does not have and they serve a large part of the market. Having a focused-cost strategy means that the goods and services are aimed at a special type of consumer whose offerings cost less than competitors.
Shareholders and Investors Shareholders own the company. On the basis of their entrustment, Komatsu Group shall exert its best efforts to preserve the value of their investment in Komatsu and to maximize their benefit. Maximizing the benefit of shareholders does not mean that we shall concentrate on short-term profits. Rather, it means that we shall aim at long-term growth of the
However, IKEA defies this logic and this paper will show how IKEA is very concerned with social corporate responsibility to make a profit while still maintaining excellent ethical standards that go above and beyond the legal requirements. IKEA as a corporation seems to believe in the triple-E bottom line. The triple-E bottom is an evaluation of a corporation’s economic, ethical and environmental value that corporation brings to the global marketplace (Sexty, 2008). IKEA does this through its annual sustainability reports, as well as the strategic way it designs its business practices through a structured supply chain. IKEA is an example of integrated corporate social responsibility this is an impressive feat as IKEA is a privately held company.
A stakeholder can be any person who can affect or is affected by an organization, strategy or project. A stakeholder can be either an internal employee of the organization or an external person to the organization such as a customer or client. A stakeholder can also be a senior executive in an organization or they can be the most junior person within the organization. A process called corporate social responsibility encourages companies to take the interests of all stakeholders into consideration during their decision-making process instead of the decisions based solely upon the interests of the shareholders.(MacEachern). Section II 1.