Week 1 Welcome to Business IT/Systems

Editor's Notes

• #7: Reasons ID market potential and opportunities, better decisions, needs and demands of customer base, sales and profit incressWhat do I need to know – Exploratory, Descriptive and Causal Qualitative research – feelings, values , why ..... Questionnaires – structured (closed Q’s) v unstructured (opended Q’s)
• #8: Read more: http://www.thetimes100.co.uk/theory/theory--organisational-functions--337.php#ixzz10o0YGieX  Information flows - For the smooth and efficient working of your organization, you must be able to control and use this flow. Without some level of control, you'll find yourself quickly drowning in a tidal wave of information which will cost you both time and money and missed opportunities
• #9: SWOT is the first stage of planning and helps decision makers to focus on key issues. SWOT method is a key tool for company top officials to formulate strategic plans. Each letter in the word SWOT represents one strong word: S = strengths, W = weaknesses, O = opportunities, T = threats.SWOT model analyzes factors that are internal to your business and also factors that affect your company from outside. Strengths and weaknesses in the SWOT matrix are internal factors. Opportunities and threats are external factors.
• #10: Defining your desired outcomes is part of good project planning.  Outcomes are linked to your aims, so defining clear aims will help you identify your outcomes.Case example: Employment projectHere is an example of the aims and objectives identified by an Employment Project that wanted to focus on its outcomes:The overall aim of the project:To improve the lives of people in London who are long term homelessWithin its overallaim it identified the following specific aims.specific aims:To increase users’ lifestyle stabilityTo increase users skillsTo increase users confidence and motivationTo enable users to find employmentOnce it had agreed its aims, the project identified the objectives or the activities/services it was providing to achieve the aims:Objectives:To provide information and advice on housing and resettlementTo provide training on core job skills and job search skillsTo offer supported work placementsTo support users in applying for jobsTo facilitate a support group for users
• #11: Sole traderThe advantages of being a sole trader include independence, ease of set up and running, and the fact that all the profits go to you.The disadvantages include a lack of support, unlimited liability and the fact that you are personally responsible for any debts run up by your business.PartnershipThe advantages of being in a partnership include its ease of set up and running, and the range of skills and experience that the partners can bring to the business.However, problems can occur when there are disagreements between partners. There is unlimited liability and, as a partner, you are personally responsible for any debts that the business runs up.Limited liability partnership (LLP)LLPs retain the flexibility of a partnership and your personal liability is limited. At least two members must be 'designated members' - the law places extra responsibilities on them.The formation of an LLP is more complex and costly than that of a partnership and problems can occur when there are disagreements between the members. If the number of partners is reduced, and there are fewer than two designated members, then every member is deemed to be a designated member.Limited liability companyIn a limited liability company your personal financial risk will be restricted to how much you invest in the business and any guarantees you have given in order to obtain financing.However, you should remember that this type of company also brings a range of extra legal duties, including the maintenance of the company's public records, eg for the purpose of the filing of accounts.FranchiseThe major advantage of a franchise is that it takes advantage of the success of an established business and support networks.However, your freedom to manage the business is limited by the terms of the franchise agreement. Also franchisees often pay a share of their turnover to the franchiser, which reduces overall profits.Social enterprisesSocial enterprises are businesses that trade for a social purpose and represent a diverse and growing range of business activity across the UK.
• #12: Autocratic - style means that the manager makes decisions unilaterally, and without much regard for subordinates, Paternalistic - form is also essentially dictatorial; however, decisions take into account the best interests of the employees as well as the business, Democratic - style, the manager allows the employees to take part in decision-making: therefore everything is agreed by the majority, Laissez-faire - leadership style, the leader's role is peripheral and staff manage their own areas of the business. Consultative Management styleA consultative management style can be viewed as a combination of Democratic and Autocratic. The manager will ask views and opinions from their staff, allowing them to feel involved but will ultimately make the final decision.
• #13: Open Source - Open-source software (OSS) is computer software that is available in source code form for which the source code and certain other rights normally reserved for copyright holders are provided under a software license that permits users to study, change, and improve the software. Open source licenses often meet the requirements of the Open Source Definition. Some open source software is available within the public domain. Open source software is very often developed in a public, collaborative manner. Open-source software is the most prominent example of open-source development and often compared to (technically defined) user-generated content or (legally defined) open content movements.[1] The term open-source software originated as part of a marketing campaign for free software.[2] A report by Standish Group states that adoption of open-source software models has resulted in savings of about $60 billion per year to consumers.[3][4]
• #14: Motivation is the activation of goal-oriented behavior. Motivation is said to be intrinsic or extrinsic. Intrinsic motivation refers to motivation that is driven by an interest or enjoyment in the task itself, and exists within the individual rather than relying on any external pressure.[2] Intrinsic motivation has been studied by social and educational psychologists since the early 1970s. Research has found that it is usually associated with high educational achievement and enjoyment by students. Explanations of intrinsic motivation have been given in the context of Fritz Heider'sattribution theory, Bandura's work on self-efficacy,[3] and Deci and Ryan's cognitive evaluation theory (see self-determination theory). Students are likely to be intrinsically motivated if they:attribute their educational results to internal factors that they can control (e.g. the amount of effort they put in),believe they can be effective agents in reaching desired goals (i.e. the results are not determined by luck),are interested in mastering a topic, rather than just rote-learning to achieve good grades.Extrinsic motivation comes from outside of the individual. Common extrinsic motivations are rewards like money and grades, coercion and threat of punishment. Competition is in general extrinsic because it encourages the performer to win and beat others, not to enjoy the intrinsic rewards of the activity. A crowd cheering on the individual and trophies are also extrinsic incentives.Social psychological research has indicated that extrinsic rewards can lead to overjustification and a subsequent reduction in intrinsic motivation. In one study demonstrating this effect, children who expected to be (and were) rewarded with a ribbon and a gold star for drawing pictures spent less time playing with the drawing materials in subsequent observations than children who were assigned to an unexpected reward condition and to children who received no extrinsic reward.[4]Self-determination theory proposes that extrinsic motivation can be internalised by the individual if the task fits with their values and beliefs and therefore helps to fulfill their basic psychological needs. Internalised extrinsic motivation has been shown to lead to more positive outcomes, such as wellbeing, increased productivity and task satisfaction.[citation needed]
• #15: Recruitment and interviewing skills is concerned with ensuring that the organisation obtains and retains the human capital it needs and employs them productively. It is also about those aspects of employments practices that are concerned with welcoming people to the organisation. In order to be proficient at this it is imperative that all managers and team leaders have the skills required to build this human capital. This programme involves participants working on procedures and process that will result in the successful selection of the company's best asset - its Human Capital
• #16: As such, the activities for preparing a Feasibility Study are generic in nature and can be applied to any type of project, be it for systems and software development, making an acquisition, or any other project. The Project Scope which is used to define the business problem and/or opportunity to be addressed.The Current Analysis is used to define and understand the current method of implementation, such as a system, a product, etc3. Requirements - how requirements are defined depends on the object of the project's attention.4. The Approach represents the recommended solution or course of action to satisfy the requirements.Evaluation - examines the cost effectiveness of the approach selected. This begins with an analysis of the estimated total cost of the project.Review - all of the preceding elements are then assembled into a Feasibility Study and a formal review is conducted with all parties involved.
• #17: Political factors, are how and to what degree a government intervenes in the economyEconomic factors include economic growth, interest rates, exchange rates and the inflation rate.Social factors include the cultural aspects and include health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety.Technological factors include technological aspects such as R&D activity, automation, technology incentives and the rate of technological changeEnvironmental factors include ecological and environmental aspects such as weather, climate, and climate change, which may especially affect industries such as tourism, farming, and insurance.Legal factors include discrimination law, consumer law, antitrust law, employment law, and health and safety law.
• #19: Force 1: The Degree of RivalryThe intensity of rivalry, which is the most obvious of the five forces in an industry, helps determine the extent to which the value created by an industry will be dissipated through head-to-head competition. The most valuable contribution of Porter's “five forces” framework in this issue may be its suggestion that rivalry, while important, is only one of several forces that determine industry attractiveness.This force is located at the centre of the diagram; Is most likely to be high in those industries where there is a threat of substitute products; and existing power of suppliers and buyers in the market. Force 2: The Threat of Entry Both potential and existing competitors influence average industry profitability. The threat of new entrants is usually based on the market entry barriers. They can take diverse forms and are used to prevent an influx of firms into an industry whenever profits, adjusted for the cost of capital, rise above zero. In contrast, entry barriers exist whenever it is difficult or not economically feasible for an outsider to replicate the incumbents’ position (Porter, 1980b; Sanderson, 1998) The most common forms of entry barriers, except intrinsic physical or legal obstacles, are as follows:Economies of scale: for example, benefits associated with bulk purchasing; Cost of entry: for example, investment into technology; Distribution channels: for example, ease of access for competitors; Cost advantages not related to the size of the company: for example, contacts and expertise; Government legislations: for example, introduction of new laws might weaken company’s competitive position; Differentiation: for example, a certain brand that cannot be copied (The Champagne) Force 3: The Threat of Substitutes The threat that substitute products pose to an industry's profitability depends on the relative price-to-performance ratios of the different types of products or services to which customers can turn to satisfy the same basic need. The threat of substitution is also affected by switching costs – that is, the costs in areas such as retraining, retooling and redesigning that are incurred when a customer switches to a different type of product or service. It also involves: Product-for-product substitution (email for mail, fax); is based on the substitution of need; Generic substitution (Video suppliers compete with travel companies); Substitution that relates to something that people can do without (cigarettes, alcohol). Force 4: Buyer Power Buyer power is one of the two horizontal forces that influence the appropriation of the value created by an industry (refer to the diagram). The most important determinants of buyer power are the size and the concentration of customers. Other factors are the extent to which the buyers are informed and the concentration or differentiation of the competitors. Kippenberger (1998) states that it is often useful to distinguish potential buyer power from the buyer's willingness or incentive to use that power, willingness that derives mainly from the “risk of failure” associated with a product's use.This force is relatively high where there a few, large players in the market, as it is the case with retailers an grocery stores; Present where there is a large number of undifferentiated, small suppliers, such as small farming businesses supplying large grocery companies; Low cost of switching between suppliers, such as from one fleet supplier of trucks to another. Force 5: Supplier Power Supplier power is a mirror image of the buyer power. As a result, the analysis of supplier power typically focuses first on the relative size and concentration of suppliers relative to industry participants and second on the degree of differentiation in the inputs supplied. The ability to charge customers different prices in line with differences in the value created for each of those buyers usually indicates that the market is characterized by high supplier power and at the same time by low buyer power (Porter, 1998). Bargaining power of suppliers exists in the following situations:Where the switching costs are high (switching from one Internet provider to another); High power of brands (McDonalds, British Airways, Tesco); Possibility of forward integration of suppliers (Brewers buying bars); Fragmentation of customers (not in clusters) with a limited bargaining power (Gas/Petrol stations in remote places). The nature of competition in an industry is strongly affected by the suggested five forces. The stronger the power of buyers and suppliers, and the stronger the threats of entry and substitution, the more intense competition is likely to be within the industry. However, these five factors are not the only ones that determine how firms in an industry will compete – the structure of the industry itself may play an important role. Indeed, the whole five-forces framework is based on an economic theory know as the “Structure-Conduct-Performance” (SCP) model: the structure of an industry determines organizations’ competitive behaviour (conduct), which in turn determines their profitability (performance). In concentrated industries, according to this model, organizations would be expected to compete less fiercely, and make higher profits, than in fragmented ones. However, as Haberberg and Rieple (2001) state, the histories and cultures of the firms in the industry also play a very important role in shaping competitive behaviour, and the predictions of the SCP model need to be modified accordingly.
• #20: PlantPlants are creative, unorthodox and a generator of ideas. If an innovative solution to a problem is needed, a Plant is a good person to ask. A good Plant will be bright and free-thinking. Plants can tend to ignore incidentals and refrain from getting bogged down in detail. The Plant bears a strong resemblance to the popular caricature of the absent-minded professor/inventor, and often has a hard time communicating ideas to others. Multiple Plants in a team can lead to conflict, as many ideas are generated without sufficient discernment or the impetus to follow the ideas through to action.[edit] Resource InvestigatorThe Resource Investigator gives a team a rush of enthusiasm at the start of the project by vigorously pursuing contacts and opportunities. He or she is focused outside the team, and has a finger firmly on the pulse of the outside world. Where a Plant creates new ideas, a Resource Investigator will quite happily appropriate them from other companies or people. A good Resource Investigator is a maker of possibilities and an excellent networker, but has a tendency to lose momentum towards the end of a project and to forget small details.[edit] Co-ordinatorA Co-ordinator is a likely candidate for the chairperson of a team, since they have a talent for stepping back to see the big picture. Co-ordinators are confident, stable and mature and because they recognise abilities in others, they are very good at delegating tasks to the right person for the job. The Co-ordinator clarifies decisions, helping everyone else focus on their tasks. Coordinators are sometimes perceived to be manipulative, and will tend to delegate all work, leaving nothing but the delegating for them to do.[edit] ShaperThe Shaper is a task-focused individual who pursues objectives with vigour and who is driven by nervous energy and the need to achieve - for the Shaper, winning is the name of the game. The Shaper is committed to achieving ends and will ‘shape’ others into achieving the aims of the team. He or she will challenge, argue or disagree and will display aggression in the pursuit of goal achievement. Two or three Shapers in a team, according to Belbin, can lead to conflict, aggravation and in-fighting.[edit] Monitor EvaluatorMonitor Evaluators are fair and logical observers and judges of what is going on in the team. Since they are good at detaching themselves from bias, they are often the ones to see all available options with the greatest clarity and impartiality. They take a broad view when problem-solving, and by moving slowly
• #21: Performance Indicators: The purpose of performance measurement is ultimately to drive future improvements in performance. There are two main ways you can use KPIs to achieve this kind of management power.The first is to use your KPIs to spot potential problems or opportunities. Remember, your KPIs indicate trends in your business performance. If the trends are moving in the wrong direction, you know you have problems to solve. Similarly, if the trends move consistently in your favour, you may have greater scope for growth than you had previously forecast.The second is to use your KPIs to set targets for departments and employees throughout your business that will deliver your strategic goals. For more information about using target-setting to implement your strategic plans, see the page in this guide on how to set useful targets for your business.
• #23: The Assets The assets of the company comprise its cash-in-hand, property (land, buildings, fittings) and the company's stock of raw materials and work-in-hand, less its liabilities in the form of borrowings or payments to creditors. Nominal Share Value Most shares have a nominal value (typically 25p, but often more or less), which originally represented the asset value of the company. The shares were once sold at a market value which represented both the worth of the assets and their ability to make money. A 25p nominal share might once have been sold for one pound, reflecting the earnings potential of the company. The total of the nominal sum of all the issued shares is the issued share capital of the company. The shares of a company are also known as its equity or stock. The Dividend and its Cover The dividend of the company is that proportion of its profits paid to its owners, the shareholders. Normally a company will pay only part of its profits as a dividend. The remainder is retained to fund internal growth of the company. It may also serve as a store of 'fat' with which to maintain dividends in lean years, when the profit is falling. Price Yield (%) Great Universal 571 3.9 In finance, the yield curve is the relation between the interest rate (or cost of borrowing) and the time to maturity of the debt for a given borrower in a given currency. e.g. The cover for the dividend of Great Universal was 1.9. This was discovered from the appropriate entries in the Financial Times.P/E Ratio The company's profits are known as its earnings. When the earnings are divided by the number of shares in existence, we get the 'earnings per share' (eps). The P/E (price to earnings) ratio measures how many years of earnings per share at the current share price would be needed to pay for the share. A P/E of 10 means that ten years of earnings will pay for the price of the share. The Yield Another important measure of a company's performance is its yield. The yield is typically expressed as a net percentage (ie after income tax) of the current share price. The long term average yield in the UK is around 3.6 per cent net. In other countries the average yield may be different, for example 2.8 per cent in the USA or 1.0 per cent in Japan.