Bargaining Power of Customers (Porter’s 5 Forces)

August 13, 2014 Leave a comment

Five Forces - CustomerAn evaluation of how it’s simple to drive costs down for the customers. The customer can influence the price and terms of purchase and may request better service and product quality. The customer power is magnified when the market has many sellers and fewer customers. The switching cost from one seller to another is another factor in the buyer’s bargaining power. The buyers switch to another seller if the products are similar and there is no significant cost to switch. The washing machine detergents are almost similar and do the same cleaning. Dental care products are almost the same with different flavors. Online search engines are another example of service similarities. Users may switch because of a delay of a fraction of a second during the search. The customer will buy another toothpaste because of the new flavor of the month. In undifferentiated market, the brand loyalty between the buyer and seller could be the only reason why a consumer sticks with one seller over the other.

The customer may switch to another product if the customer is well-deducted about the product and have price sensitivity. The availability of the product substitute makes the seller weaker relative to the customer bargaining power. Supermarket shelves in most countries are stacked with different bands of a similar product that the consumer can conveniently choose from according to the brand name, price tag, or attractive packaging.

Regional small farmers, selling most of their farm products to a large supermarket chain have little influence on the terms of the sale. The farmer may opt not to sell to the supermarket at the price they set, but then the farmer has to endure the additional transportation cost to sell his products to another market.

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Simplified Business Coaching

July 20, 2014 3 Comments

Businbusiness_grey_stickmen_shake_hands_pc_800_clr_1570ess coaching provides the business owner time and space to stand down and reflect on the overall business. Business coaching will give the leadership team the opportunity to voice their concerns, discuss their challenges, and future circumstances. Business and personal coaching are similar, to some extent, to sport coaching because the coach will help the individuals to discover their true capabilities and overcome mentally set limitations. 

Business and personal coaching are both build on the trust between the coach and the client. A professional coach asks the right question at the right time to provoke the client thoughts and imagination. Business coaching is located between therapy and consulting. The coach’s power-questions inspire the client to search through his or her experience to find new answers and the means to overcome the challenge or solve the problem.

For more information on coaching and to request a free professional online coaching session please click here.

 

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Locus of Control

August 1, 2011 2 Comments

Locus of control is an indicator of the individual’s sense of control over their successes and failures (Navahandi, 2006). Individuals’ beliefs that events they are experiences are due to luck, fate, or their own behavior (Scott et al., 2010). Individuals with strong internal locus of control believe that their success and failures are caused their actions. Individuals’ with strong external locus of control believe that what is happening to them is the result of chance, luck, or fate (Navahandi, 2006; Scott et al., 2010). Navahandi (2006) stated that leaders with strong internal locus of control are more likely to lead their teams better than leaders with internal locus of control. Managers and leaders with external locus of control believe that external threats are unmanageable, but the ones with internal locus of control believe they can cope with stress and handle their future (Scott et al., 2010).

References:

Navahandi, A. (2006). The art and science of leadership (4 ed.). New York: Prentice Hall.

Scott, S. L., Carper, T. M., Middleton, M., White, R., Renk, K., & Grills-Taquechel, A. (2010). Relationships among locus of control, coping behaviors, and levels of worry following exposure to hurricanes. Journal of Loss & Trauma, 15(2), 123-137. doi: 10.1080/15325020902925985

Wood, A. M., Saylor, C., & Cohen, J. (2009). Locus of control and academic success among ethnically diverse baccalaureate nursing students. Nursing Education Perspectives, 30(5), 290-294.

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Technical Position Training

July 21, 2011 Leave a comment

Technical employees need intensive technical training but also need managerial and leadership training to advance in their jobs. Some organizations start the administrative and managerial training too late which make the technical employees struggle in approving and implementing their ideas.


Technical Position Training Model

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Meetings: What Is Really Going On?

December 15, 2010 6 Comments

Listen to this postWe spend few hours everyday in meetings. Some meetings are short and simple, like a one-on-one meeting to discuss specific issues and take decisions. Other meetings are usually last between half to full hour with attendance between 3 to 7 participants half of them do not know why they are sent to the meeting. Some meetings are large, noisy, crowded and long. They are more like a workshop than a meeting but they exist in the business world and many of us had survived few of them. These large meetings are the least productive meetings because they are difficult to control. It would be almost impossible In such meetings to listen to every participants’ input and give them enough time to discuss their thoughts.
Mismanaged meeting consume the management time and effort and hold the participants in a place were they are only listening instead of working on important issues outside the meeting. You will know that you are in a mismanaged meeting when the participates have side talks and others are frequently checking their iPhones and Blackberries instead of participating in the meeting. You will know that you have been in a good meeting when everybody leave the room knowing enough about the subject to describe it to anybody who ask them about it later. The participants in a good meeting will leave the meeting with a set of actions to take with a specific outcome on a target date. They know whom they should contact for clarifications and to whom they should report their progress. This post is an introduction to a series of posts on the same subject I will be updating in the coming days.

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Sugar Coating

November 17, 2010 6 Comments


Listen to this postYesterday was my anniversary at work. I have been with the same employer for the past 30 years and I enjoyed most of the days I worked there. Now I am managing more that 700 employees and I have tried to be fair with them while meeting most of their needs, requests and demands. One of the best tactics the employees use for their complains is “Sugar Coating”. I am not saying that the complain is true or not, but the way it is presented to me is sometimes strange.

For example, an employee would take an appointment to see my Boss and then start his discussion by saying “This is not a complain, I just wanted to say…” and then he or she would exaggerate every negativity they experienced in the last 3 years! Another example is when the employee send an official complain to HR or my Boss, but then catch me walking by and start by saying “I wanted to talk with you about an issue I have … do you have a minute do discuss it?”

We all make mistakes and we should take our responsibilities to admit the mistakes and correct them. But using different ways to discuss the complain is not the best start to resolve any issue. Through my years at work I followed a good philosophy that goes something like this “Do not explain…and Do not complain” and it made my life very simple and peaceful. I am sure that my boss does not want me to explain to him why I made the mistake (or delay in an assignment). And I am very sure that nobody would like to set and listen to my complains. When I make a mistake I would admit it and do my best to correct it. If I have a complain or an issue with somebody, I would meet him or her and discus the issue face-to-face with them. Other than this … life is very simple.

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There Is Only 24 Hours Every Day

October 16, 2010 6 Comments

Listen to this postWe have only 24 hours in every day. I am sure that you know this fact but I just thought of reminding you. Some of us would like to have more hours everyday, while many people complain of boredom and say “I have nothing to do” or “I can not think of anything interesting things around me!”  I am one of those people who wish we can store time and use it when we need it most. But actually I do not have extra time to store for later use. I consume most of my time between work, exercise, family and study. Oh, yes, I forget to mention sleep!

Some days I come home from work at 5 PM to have my main hot meal then take a long nap ( or short sleep) and wake up at 9:00 PM to start studying until the early hours of the morning. Late night studying is very good because of the concentration. No distractions because everybody at home would be sleep or ready to sleep. The worst part of this plan is messing the quality time with the family and the uncontrolled weight gain. For those who complain of boredom I would recommend they read a book.

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Keiretsu

October 7, 2010 2 Comments

Minority networks of Japanese organizations have shares in the other organizations to create a larger network. The network collaborates to boost each other’s interest (Jones, 2007).
Financial Keiretsu link and group various companies which have their own large banks. The capital Keiretsu is used to manage input and output linkages between the small networks of organizations (Jones, 2007).
Toyota is using capital Keiretsu by owning as large as 40% share from the companies that supply it with inputs. With this share, Toyota is able to exercise good control on its resources (Jones, 2007). The Fuyo Keritsu is a financial Keiretus that has Hitachi, Nissan, Canon and many other companies joined by Fuji bank which provide the financial services to the group.
Just In Time (JIT) principle is part of the Keiretsu theory where companies depend on receiving the needed parts just in time for their use from a supplier that produce the right amount for the user. Keiretsu enabled Toyota to have the strong relation with its suppliers without the cost of owning and managing them. General Motors (GM) has full ownership of its suppliers than any other carmaker which made GM incur the cost of the supplier while the supplier running inefficient operations knowing that GM will buy their products regardless of their business efficiency.
Ford the car manufacturer formed its Keiretsu by owning minor share in its engine supplier, windows producers, body parts and wheels manufacturer. Ford also had notable ownership in the car rental company Hertz which use Ford’s cars only (Jones, 2007).

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Going to the Movies

October 2, 2010 2 Comments

Listen to this postI do not spend much time enjoying the entertainment most of the people do, or at least not the same way they did. I listen to music from my PC or iPad while I working or studying and using the Internet. I usually listen to Smooth Jazz music on one of the Internet radio channels. I do not watch TV! In a full week I would spend about one hour watching TV only because it was switched on one by somebody else. For example the TV is now switch on one of those 24 hours cartoon channels and I am now typing this post thinking that I am spending quality time with the kids! I entertain myself by spending time chatting with my wife or drinking tea with my mother. I do that almost everyday. I do not go out to coffee shops, restaurants, theaters or other public functions, but I enjoy going to the movies. Every weekend, and sometime weekdays, I would dress up and take my wife to the movies. I like sci-fi, adventure, and drama. I only chose movies which are ranked 6.5/10 or above. I usually buy nachos with cheese and jalapeño. Every time I eat the jalapeño I wake up the next day with a troubled stomach, but again, I would have the same Nachos and jalapeño next time I go to a movie. I consider the weekly movie as major entertainment that break my busy weakly routines. I wonder what other busy people do to entertain themselves?

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Giving Feedback: Positive or Negative

September 28, 2010 4 Comments

Listen to this postGiving feedback or confronting employees is one of the most difficult social task we face in our lives. Giving positive feedback is sometimes called motivation or encouragement, and many of us are sometimes doing it wrongly by generalizing the feedback by saying “you have done a good job”. A good feedback should be specific like saying “Your report has listed the major critical points that we did not notice before, thank you for reporting them to us.” We do similar or even worse mistakes when we give negative feedbacks. Sometimes our negative feedback has more destructive effect than the constructive change we hoped for. Reading the following pages will help you understand the types of feedbacks you may use at work or at home. Some valuable examples are given at the end for your reference.

Giving feedback or confronting employees is one of the most difficult social task we face in our lives.Giving positive feedback is sometimes called motivation or encouragement, and many of us are sometimes doing it wrongly by generalizing the feed back by saying “you have done a good job”. Agood feedback should be specific like saying “Your report has listed the major critical points that we did not notice before, thank you for reporting them to us.”We do similar or even worse mistakes when we give negative feedbacks. Sometimes our negative feedback has more destructive effect than the constructive change we hoped for. Reading the following pages will help you understand the types of feedbacks you may use at work or at home. Some valuable examples are given at the end for your reference. Read more …

Click here to download the full material as PDF file.

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