How the Structure of an Industry in Which Firm Is Operating Can Determine the Performance - Essay Example

Business Econs Explain how the structure of an industry in which firm is operating can determine the performance and conduct of that firm. One needsto realize the fact that business is a consistently changing world and in this world only the people who are ready to change are successful. Thus to put it in the related context, change is the only constant in the world and in the business scheme of things, changing to suit the will and desire of the customers and/or the stakeholders as well as doing one last bit to bring in more revenues and profits for the company just plays the right trick for the business to succeed both in the short term as well as in the long run. Businesses which stagnate over a period of time and do not change because of one pressure or the other usually die out quickly. The ones that have existed thus far have relied a great deal on the phenomenon attached with change and consistent upgrading of the needs as put forward by the business and its norms. The changing market structure might call for changing strategies and lines of action that would all target the people for whom the product is actually designed as well as the competitors with whom the clutter is being broken in the environs of the marketplace. Thus competition brings in more and more quality at the end of the company with regards to its products as well as more sales in the form of its varied and changed stance on focusing towards the customers rather than the product itself. Apart from that, emphasis on need must be the order of the day rather than bringing out more and more varied stock key units just for the sake of it. The different products should satisfy each and every user rather than satisfy the people sitting in the innovation labs and those who invent just to take the company one step further. This trap should thus be avoided under all circumstances. Thus profits could come out in the middle when a company is the sole and dominant player in the whole market structure. Business professionals should keep in mind that the profits have to outnumber the losses in the longer scheme of the whole equation of carrying out a marketing activity. If this is not the case, then the business might not survive for long and the losses will lead it to simply nowhere at all. It is imperative to pinpoint the weak and grey areas and thus set out on a journey on the part of the marketer to tackle the very same and thus bring to light the positives out of the whole equation. Thus significance lies on the shoulders of the main person who has set the ball rolling as far as the business is concerned and it is up to him solely as to what he has in mind, with respect to the vision and mission of the business and the company for that matter. Every big business or multinational that is existent in present times credits itself on to the vision of an exemplary personality which started it all when the going was tough and when there was a huge competition in the related market. Thus to withstand pressure and competition is the hallmark of any successful and long lasting business, company or enterprise, whichever term we might quote it as. Therefore significance is laid on the fact that organizational structure impacts the manner in which work is basically carried out. More than anything else it adheres to the different purposes of the discrete services and the related achievements with the passage of time. This brings to light the notion of discussing the structural basis of the organizations themselves. For starters, these organizations might not be that easy to understand at the very beginning. These can encompass a variety of different aspects, features and traditional mindsets which make up their structures. To start with, we see that an organization can either be formally aligned in its ways and means of doing things and different processes or the same might just be in a way informal in quite a few of its activities and tasks. The manner in which it runs across this paradigm is something that needs to be studied in depth before we reach further consensus on their purposes and the kind of achievements that they have had. The communication within an organization can flow in one of three ways or in all the three directions. A firm needs to change its position with the changing times otherwise it will literally vanish away from its competitors and more so the customers, for which it actually exists. It must bring about certain efforts which are geared up to make it sound, look and eventually feel different from the rest of the lot and in the long run, have a selling proposition in it and in its products that help it in winning the customers time and time again. Similarly, it needs to make sure that its staff members and employees are amongst the best in the industry and that they can relate with the norms and routines of the top corporations working hand in hand with each other but competing on the business level. In the present times, organizations are doing their utmost in order to know more and more about their valued customers and stakeholders. For this, they have devised certain strategies which are in line with the values that their business has set for itself. These values are thus deeply intrinsic within the mission and vision statements of the company. In order to gain further knowledge about the customers, research is being given proper emphasis which would eventually discern the exact basis for the customers to come and make that vital purchase. It is a fact that the business world of present times can have a lot of improvement within their ranks if they adopt the policy of working towards the establishment of a performance management system. This would guarantee them a lot of success as their employees and workers would dedicate their whole hearted efforts towards the well being of the company as well as towards their own individual capacities. The usage of sound planning on the part of the managers is very imperative as it ensures that the same is not only important to the whole well being and the actual basis of the business but also the manner in which it invites the short term gains and incentives that come along all this while. Managing change within an organization is one of the most significant aspects that come under its sound functioning regime. Only the companies which are able to come to terms with the new norms and practices are the ones that succeed not only in the short term but also in the longer scheme of things. This means that the company has to devise certain ways and means through which it can manage change, measure it and effectively counter the problems that come in its way all this while. The learning process, meanwhile on the part of the organization is immense since it finds out the exact mechanisms and procedures through which change is going to affect the employees' and stakeholders' relationship with the company's central essence, which is the top management, making all the decisions that would eventually benefit the company in the long run. How would the price elasticity of demand for an individual firm's product be influenced by its industry structure' Illustrate answers with examples The manner in which products of a firm are priced at the time of their coming and making their mark in the market is heavily dependent on the kind of quality and value the business manufacturers are producing for the intended customers and users. This means that they have to tackle a whole lot of issues which not only take into perspective the cost factors but also the marketing aspects related with the advertising and publicity budgets and not to forget the efforts that go in line with the word of mouth approach, considered so very effective in this line of business and marketing practice and ideology. The price is a very significant factor since there can be a number of different principles that need to be followed in the wake of setting it up in the first place. The business manufacturers can go for the normal trend which has been there for so many years now in the market but since the innovation is unique and is perceived to be a sure hit within the intended users and customers, therefore the price quotient is set to a level which is above the over and average expectations. This means that no other product can match the value provided by it and thus it can easily be taken for a new change or shift towards advancement in the related product category. Coming back to the tangent of pricing, we see that the price is set on an equal parity basis which means that whatever is the norm and routine in the market, the price for the new product having more features and value embedded within it would be much higher than the previous versions or models of the same product. This also means that every new product would bring in more and more revenue for the company concerned and indeed the whole of the business industry which is producing it in the first place. Another basis for setting the price is either skimming the price to such levels where it is automatically perceived as something of a very high quality product or one that is taken as being worthy enough to get on the part of the customer or penetrating it at levels which are below the normal market ratios as this would ensure that more units of the medium are sold at a fast rate as well as the stock reaches maximum (point) ratio of selling. However this methodology has a drawback in the sense that it has been taken as one which suggests that there is low quality associated with the product and hence it means in fathoming that the product is not as good as its predecessors and the related product models and thus the reason for its low price tag. The same could so very well be wrong but then again it is a business practice and needs to be considered in the proper perspectives before we move further ahead. The issue of pricing is one that needs to be discussed by the company executives as well as the business circles before the product is about to be launched big time in the market. For this to happen, there needs to be a proper method of synchronization and symphony between the business officials and different firms who are advised to agree on a single pricing index as well as make themselves at complete understanding with the deliverables that would come in the wake of the product getting an instant hit in the intended market, i.e., for the customers it is being made for in the first place. Without a doubt, the world economy has grown in recent decades. So much so, that the pundits have said something good about it. International trade is something that is attributed to this upheaval. It has formed the motivating factor behind the very same. Developing countries have also stepped on to the bandwagon and are thus bringing in more and more opportunities for the developed nations to invest their money in their territories. One such example is that of outsourcing where developed nations are taking the plunge and entering into the developing nations' zones and thus reaping huge benefits. It should be kept in mind here that this is a symbiotic relationship, benefiting both the parties on a consistent basis. It has also been seen that the developed nations are more than happy to outsource their work and set up offshore avenues in order to earn revenues and make the most out of their business. However the litigations that are in place with regards to setting up these industries is something that needs to be delved into by them in detail and we, as students of the same, will try our best at understanding the whole ball game. The sales force is the true face of the various organizations that do their supply chain activities and thus the relevant product and brand to our tables. Without them, there would be no breakfast cereals, no soaps, groceries and so on and so forth. The sales force is also responsible for speeding up the whole process of supply as well as meeting demand deadlines day in day out. With that, they can exert their pressures on the different channels and thus wrest the initiative in bringing the product to the markets in a much better and cohesive manner. The intermediaries working at the different levels can bring with them loads of experience under their belt and thus motivate the line (channel) members from meeting demands on a consistent basis. This means that the sales force members can mingle with each other and force movement of a particular quantity of product as well as slow down the very same. The latter can come under the negative market scenarios and it is best advisable to avoid it as it can create a situation of distress in the market, both geographically and tactically speaking. In the whole related discussion of price elasticity of demand and supply, we seem to be missing one point. We need to talk about the cost structures as well as the relationships that are entailed with the different types of costs and the management decisions which are so very significant with the basis of these costs in the first place. Costs are firstly divided into the ones who are quintessential on the part of the organization and the ones which are not so significant so to speak, hence there is a division to start with. Now what is most important here is to make sure that these costs are divided in a manner that the profits and returns of the organization are not affected due to any lingering attachments. The fixed and variable costs can easily be bracketed as the pertinent ones but then again one needs to comprehend what is the exact basis of these costs before we move to a conclusion. All said and done, the cost breakups and the related factors is something which must be emphasized upon in greater detail and without the help and facilitation of the different pricing mechanisms, we might just miss out on the whole scenario once and for all. The imperative point is to make sure that the pricing and cost issues are dealt with in a strict fashion so as to avoid hiccups at any stage of the organizational game plan. This is indeed the need of the hour. BIBLIOGRAPHY ADKINS, Sam S. (2003). The Brave New World of Learning. T&D, Vol. 57 AXLEY, Stephen R. (1996). Communication at Work: Management and the Communication-Intensive Organization. Quorum Books BASSETT, Glenn. (1993). The Evolution and Future of High Performance Management Systems. Quorum Books CRAMPTON, Suzanne M. (1998). The Informal Communication Network: Factors Influencing Grapevine Activity. Public Personnel Management CYERT, R.M. and J.G. March. (1963). A Behavioral Theory of the Firm. Prentice- Hall, Englewood Cliffs, NJ EDENS, Eleana. (2001). Improving Teamwork in Organizations: Applications of Resource Management Training. Lawrence Erlbaum Associates FORD, John B. (2003) Sales Management: A Global Perspective Routledge LAMB, Larry F. (2005). Applied Public Relations: Cases in Stakeholder Management. Lawrence Erlbaum Associates NEELY, Andy. (2002). Business Performance Measurement: Theory and Practice. Cambridge University Press SMITH, Darlene Brannigan. (2004) Managing for Value: Developing a Performance Measurement System Integrating Economic Value Added and the Balanced Scorecard in Strategic Planning Journal of Business Strategies Vol. 21 TIE, Robert. (2001). Get Ready for the World of B2B. Journal of Accountancy, Vol. 191 WEITZUL, James B. (1993). Sales Force Dynamics: Motives, Management, Money, Marketplace. Quorum Books Word Count: 2,504 Read More