Consulting in Organizations for In and Out Advertising - Essay Example

Running head: WRITTEN REPORT OF CONSULTANCY PROCESS, TESTING AND APPLYING AS APPROPRIATE THE THEORIES OF CONSULTING Consulting in Organizations... for In and Out Advertising University Name Abstract In and out advertising is a very important tool in promoting businesses since it helps in realizing the expected returns. The Senge report seeks at explaining the various theories that helps in acquiring successful advertising techniques. The report takes a closer look at the Senge's five learning disciplines the SWOT analysis, PESTEL analysis and the theory of Porter's 5 forces. Under each theory there is detailed information on how the approaches are applied in the dynamic world of marketing. This will greatly assist my client in understanding the marketing concept a thing that will help in acquiring knowledge on how to successfully run a business. Consulting in Organizations... for In and Out Advertising The today's business world is changing in a very fast rate. The market expansion, advancement in technology, mergers and acquisitions, need for business restriction, financial constriction and government's legislation are calling for charges in business so that they can keep page with the new dynamic world. To find markets for their products organization's needs to advertise so as to create awareness of the products availability to the general customers, advertisement can be done locally, regionally, nationally and internationally depending on the type of products to be advertised. The report carries different theories that are appropriated for effective advertising in an organization. The theories covered under this report include, PESTEL, SWOT analysis, the Senge's five learning disciplines and porter's five forces. PESTEL ANALYSIS This is a very systematic way of looking at the extended factors that holds as potential impact in the business organization. These external factors are: - Political factors Economic factors Social factors Technological factors Environmental factors Legal factors Political factor/ environment will include the tax policies by the government, government's business regulation; imposed trade tariffs and restrictions among others. Any business organization is supposed to known the tax policies affecting various regions this will help them in estimating the advertising costs in every region this evaluating its importance. The business organization is also supposed to know the government's business regulation so as to know the type of products to deal with and how to advertise for the same, they also ought to know imposed tariffs and restrictions which will provide important guide on the regions on which advertisement can be done. The organization can apply the political dogma which is a set of philosophy, ethics and supposition within a given society. The political factor emerges as the most tumultuous in all the environmental forces. Any business organization needs to equip itself with the knowledge on the prevailing political climate whether locally, internationally, nationally and regionally. The political climate plays a great role in determining and evaluating the likelihood of business failure or business success. If the political climate is unstable then it will affect product's marketability affecting negatively on the total sales volume. In such a scenario it is not advisable for firms to extend their advertisement on such regions experiencing political instability. Such advertising efforts may not yield anything for the company translating into huge loses in terms of advertising in a region / nation that is politically stable will yield more success to the company a thing that enhances advertising. (Ansoff, 1965) The business organization needs to know how the economic factor affects its business enterprise, for example, if the business is being operated under a small economy then it means that greater efforts need to be applied on advertising so as to increase the sales volume. This can be extended up to the international level so as to collect more money for the organization. If a business enterprise is based on a large economy it will mean that it has more customers for its products a thing that won't require much in and out advertising as compared to the smaller economy. In such a scenario the business dues not need to put lots of finances on advertising making it cheap and affordable for enterprises within such and economy. . (Porter, 1998) The entrepreneur needs to have a thorough knowledge of the social factor regarding the population under which the business is set up. He needs to know the social economic status of his customers a thing that will guide him /her on the appropriated advertising techniques to apply. If the customers are under the bracket of low economic status then he does not need to apply expensive methods as this is not likely to impact more on the sales made. On the other hand if the surrounding population is of high social economic status advances advertisement can be applied a thing that will ultimately yield some fruits for the whole business operation. The organization needs to consider the socio - cultural trends of the population under which the business covers. This entails their culture background, taste and preference. In this context, for a product to be advertised in a particular region it is very important for the firm to carry out a research on the socio - cultural behaviors and trends of the people occupying that region. This will assist the organization in knowing its customers taste and preference thereby availing such products to them. (Ansoff, 1965) The firm can embark on advertising those products that are in line with the socio - economic preferences of its customers. It would be a great waste of resources for a company to advertise it's products on regions covered people who has a very low or no taste & preference for the advertised product. The other factor under PESTEL analysis is the technological factor, under this business organization needs to study the technological patterns of a given region. This will help them in differentiating between the obsolescence products and those products that are likely to be fast moving thus staying in the market for a long time. Under this the company needs to be very inventive and innovative so as to come up with products whose advertisement will be easier to undertake. Technological factor will assist the company in knowing the best advertising technique to apply and where to be applied. Advertising ought to be concentrated in regions experiencing dynamic advancement in technology. However, in those regions without much technological advancement sophisticated methods of advertising need not be applied as this is not likely to realize any returns in the business. (Ansoff, 1965) For any business organization to succeed the environmental factor cannot be ignored. This will include the real environmental change for instance the global warming and the general opinion gathered from the public or environmental issues. Owners of any business organization are supposed to update themselves on the environmental change so as to come up with products that auger well with the change in environment. (Ansoff, 1965) The legal factor comprises the informal and formal rules and regulation that govern the operations of a business. Any business enterprise needs to know all the formal and informal rules within the legal framework so as to know the boundaries limited to business operations within the legal framework. In general PESTEL analysis is a very good approach in evaluating the overall business environment in a business firm. This helps in the management of threats and opportunities that may occur in the future as a result of possible environmental changes. This report will help the business in comprehending, identifying and familiarizing itself with the external issues affecting the business so as to predict the probable outcomes after a change in the environmental patterns. This will help the business organization in changing the rising environmental issues from all opportunities to threats; the enterprise will also come up with issues, strategies and guidelines that are well thought out. The second theory is Senge's five learning disciplines. This theory touches on five disciplines which when combined form a system of business operation. The five disciplines include: Personal mastery. Mental models Building shared visions Team learning Systems thinking Chances are high that an organization may be lacking some of the five disciplines and at the same time be highly developed in other disciplines. Personal mastery looks at individual's growth and development in learning. It helps in regular deepening and explanation of the individual's vision a thing whose outcome is the required results. And entrepreneur should practice personal mastery so as to succeed in the business field; personal mastery is a process that individuals acquire in their entire life. It entails perpetual explanation of important principles and the need to see reality in a clear manner. These way entrepreneurs will develop the ability of producing positive results in life. Personal mastery is characterized by having a view of our relationship to the world, combining ideas and intuitions, facing life courageously viewing it as a creative work among others. Personal mastery is identical with a high proficiency level. Individuals and organizations possessing a much higher degree of personal mastery is with a high degree of personal mastery are capable of producing desired results time and again. They arrive at this achievement by perpetrating to lifelong learning. Personal mastery may also be defined as frequently illuminating and deepening a personal visualization, the centre of attention being energies and learning that assist organizations in viewing things in an objective way. Assurance of organizations members should take the centre stage in portraying the organizations commitment. Personal mastery helps in the development of personal vision. Business organizations must understand that individual's vision is a process that calls for more thinking, reflection and is time consuming. Business organization should use the gap between where they are in relation to what they want and what they want to create energy. Tension should be viewed positively so as to pull the organization to it's vision. They need to avoid a feeling of unworthiness and powerlessness in the business arena. The organization should avoid losing direction on matters relating to vision, creating conflicts each and every time and also lacking will power which is characterized by negative vision. The second discipline is the mental models, every business organization needs to apply the mental models a thing that will help it in shaping its actions, determining its view on the business world, and understanding that it is hard for a company to change its mental models. Examples of mental models are that some individual's thing that people buy products based on style. Mental models outline presumptions to the extent that they may put off the learning organization's formation. It is widely thought that the failure to appreciate mental models has destabilized great work on fostering systems thinking it serves as an attempt to identify the reasons for organizational problems or lack of learning, thus allowing us to comprehend the relationship between individual organizational elements in a better way. (Ansoff, 1965) Observing entrepreneurs minds' is the most needed skill for comprehending the mental models, this is because entrepreneur minds works very fast thus leaping generalizations. It helps in controlling and the management of organizations with the best visions and values being applied. Building shared vision and a sense of assurance in the organization. According to Senge, (1999) building Shared Visions may be defined as a joint picture of positive future results obtained from the collective total of the personal vision of the individuals in the organization. If the vision is persuasive, the general expectation of individuals within the organization will be seeking for the capacity to accomplish their vision. This includes what the organization wants to achieve, why they should achieve and methods to be applied. Shared vision provides answers to what kind of product a company want to creates, it is and internal force emanating from people's heats with an aspiration to be related to a greater purpose and one another. However, these visions tend to fade because organizations view the gap creating the creative vision as too wide with the demands of modern realities being overwhelming forgetting the relation between the organization and its visions/ mission. (Senge, 1999) Team learning which is defined as a process of supporting and developing team's capacity in results creation that is desired by members. This disciplines calls for organizations need to have insight thinking about sophisticated issues, advantage of being inventive in co-coordinating actions and realized organizations effects on the customers. Team learning is characterized by round table discussions where different views are presented, exploration of sophisticated issues, creations of group insights. This is done by observing organization individual thinking which helps in disclosing of hidden unfairness in our beliefs. However, there are problems that are likely to be experienced in dialogue some of which include the regular way of interaction that bars learning from taking place. (Senge, 1999) Lastly, there is the systems thinking disciplines hold views that living organism depends with the interactions and connectedness among each other, organizations need to understand that the properties of the parts. When a business organization applies system thinking it will be operating with the general understanding that accomplishment by humans are part of the larger process (Senge, 1992), this cognitive approach promotes the entire system's evaluation and not simply the isolated parts. It therefore becomes very hard for various organizations to identify the change outlines since they are used in focusing isolated problems only. In the to days natural world where are linked with outlines and making each one of them to affect the other Senge comes up with a proposal that business enterprise and the other human accomplishment must be inspected within the very similar types of systems thinking.(Flood,1999) Michael Porters (1979) looks at the five forces that are important in determining the attractiveness of a market to the customers. His theory was arrived at by integrating developed concepts in industrial organization. He called the forces microenvironment and is comprised of forces close to a firm which affects the firm's ability in attending to its customers. Should any force change then a company needs to review its market place. The five forces under this theory one, bargaining power of supplier, customers bargaining power, new entrant's threats, threats of substitute and the level of competition in an industry. Under the bargaining power of suppliers the organization needs to know about the likelihood of inputs substitutes, looking at the bargaining powers of suppliers will help the company in obtaining the required inputs differentiation degree, the firms concentration ratio to the supplies concentration ratio, importance of having suppliers to deliver inputs in bulk where the idea of economics of scale comes in, the organization needs to monitor the firms switching costs a thing that will help in cost benefit analysis, the firms needs to evaluate the threats of back firms integration as compared to that of suppliers forward integration thus balancing in its operations and the overall evaluation of the inputs cost in relation to the selling price of the products. The second force is the customers bargaining power and it entails the organizations ability to evaluate the sensitivity of prices to the buyer, the volume of the buyers, the customers bargaining influence, the prices of total consumers purchase, the availability of information to the buyer, firm's switching costs, and the availability of existing product substitutes and the volume of the buyer. (Porter, 1998) Threat of new entrants is another force that will determine how attractive the market is where modifying advertisement bill boards a company needs to put in consideration the brands equity of various products, the advertisements capital requirement, the accessibility of product's distribution, the economies of various differences in given products, the importance of learning curve advantages, expected retribution from the buyers and the competitors, the government policies in place plus the overall cost advantages. The fourth force is the threats occurring as a result of substitute products. It is important for the organization to consider and calculate the buyer's propensity to substitute, the switching costs by the buyer, and the apparent product differentiation level. The last force is the level of competition in a given industry. According to Peteraf, (1993), the business organization needs to know the rate at which industries are growing in a given area, before embarking in a more to advertise its products; it also needs to evaluate the brands equity, the advertising expense, the powers attached to the buyers. Threats posed by entrants who are new in the market, the suppliers attached powers, threats posed by those products which are close substitutes to the advertised product, the total number of competitors in the whole market, irregular overcapacities in the industry, the possible barriers in existing market, how various competitors diversify their products for example moderate diversifications in the BMG, EMI and Sony companies. The business organization needs to estimate the value of advertising costs, assessment of the complexity and the asymmetry of information, the allocation of fixed cost in relation to the value added and lastly the switching costs of products. SWOT analysis is an important device in establishing the products attractiveness in the market. The acronym stands for strengths weakness, opportunities and threats. The theory is divided into two i.e. internal analysis comprising strengths and weaknesses and the external analysis which dwell on the opportunities and threats. Internal factors are seen as weaknesses or strengths regarding the impact that they make on the organization business objectives. Some objectives represent strengths while others are indication of weaknesses. These factors (internal) include the organization's resources for example the financial resources, the efficiency in the firms general operations, the quality of products, the skills knowledge possessed by the member of staff, price of various products, the overall management of activities in the firm cost of advertising and other associated services, the delivery time i.e. whether punctual capacity the general infrastructure, services rendered to the customers and establishment of good relationship with the customers in key industries. The external factors incorporates threats and opportunities, they also include legislation, changes in the socio - cultural environments organizations competitive position, change in technology and the general macro economic matters. Under external factors organization needs to look at the political environment in the market (both local and international) so as to know the best advertising technique to apply, the firm should operate within the legal framework by dealing with products which are legally accepted, it should also assess, the economic condition of the region covered by the market this will help in designing the best advertisement methods to be applied. If the economic condition is stable then much advertising can be undertaken since it will realize increased sales volumes. (Penrose, 1995) The firm should also evaluate the stakeholder's expectation before starting on any advertisement criteria this will help the business to operate as per the interest of its various stakeholders. The organization should monitor the actions of its competitors to sort between the competitive ones and uncompetitive ones, the expectations of the public should also considered in live with the stakeholders expectations. However, organizations should always separate the company's external opportunities from the company's internal strengths SWOT analysis should exist with reference to specified objectives and not as abstracts this is because failure to openly agree on defined and state may lead to ineffective results and lastly organizations should avoid confusing possible strategies with SWOTS especially in opportunity analysis. References Ansoff, H. (1965): 'Corporate Strategy': New York, McGraw Hill Flood, R. (1999), Rethinking the Fifth Discipline: Learning within the unknowable, London: Routledge. Kay, J (1993): 'Foundations of Corporate Success': Oxford University Press, Oxford Penrose, E. (1995): 'The Theory of the Growth of the Firm': New York, Oxford University Press Porter, M. (1979): 'How competitive forces shape strategy', Harvard Business Review, March-April, pp. 137-145. Porter, M. (1998): 'Competitive Advantage (with a new introduction)': New York, The Free Press Peteraf, A. (1993): "The Cornerstones of Competitive Advantage: A Resource-Based View," in Strategic Management Journal, Vol. 14, pp. 179-191. Senge, P. (1990): The Fifth Discipline: The art and practice of the learning organization, New York, Doubleday Senge, P. et al (1999): The Dance of Change, New York, Doubleday Senge, P. M. (1992): The Fifth Discipline, Sydney, Random House Read More