Quality Assurance

1.The concept of quality can be described as anything that meets costumer's expectations and therefore, makes him satisfied with a particular product. Besides the customer's requirements, quality also depends on product's price. To be more specific, product of high quality does not necessarily have to be expensive as long as it satisfies the customer. To conclude, rather than considering quality as absolute, a relative concept would be more accurate.

2. Quality control can be defined as a control "based on inspection of the product or a sample of products."

3.Quality control has three stages that help make it effective. The stages are the following: prevention, inspection and correction and improvement.
a) prevention: the main role of the first stage is to improve products and fix or remove imperfections. It makes sure that design of the product makes customer's expectations.
b) inspection: it used to be the most expensive stage as it requires high costs. Therefore, instead of hiring inspectors, many companies started to use total quality management.
c) correction and improvements: in the last stage correcting the faulty products as well as the actual process takes place. The main idea is to avoid these problems in the future.

4. One of the possible weaknesses of inspecting for quality is bias. In other words, the main focus of the inspectors on the work of workers is find their mistakes or problems. Hence, it already has a negative and biased approach. Another weakness is that since it is inspectors' responsibility to control the quality of a specific product, the work often do not try as hard to make quality product because they it is going be checked again anyway. Finally, it might be very time consuming to not only identify the fault of a product, but to also fix it. Especially, when the product passes through several stages of production.

Coke and the Numbers!

Production costs of Coke could be divided into two categories: fixed costs and variable costs. Fixed production cost of one small can of coke is approximately 6 cents while the variable production costs that include shipping and handling often rise to 19 cents.

The price for which the coke is sold in stores is somewhere between 45 to 60 cents per small can of coke.

Therefore, the revenue, which retailers get from selling one small can of coke is around 30 cents. 

This suggests that the profit the retailers make is in a range of 15 - 30 cents.

                  

Production Methods

Job Production 
-motivates the workers

• Wedding rings: The possible strength is that it meets the customer's exact requirements.
• Made-to-measure suits or dresses: Since the suit or dress were made only for this customer, it fits him/her perfectly. The product is unique and customized.
• Aston Martin car: each engine is hand built and carries a plate with engineer's name on it, which makes it look unique.

Batch Production

-allows the firm to use division labor

• School uniforms or jerseys: Since Batch production produces a limited number of identical products, it is very beneficial for sport teams or schools where all members should look alike. The product can be altered depending on customer needs.
• Production of identical bread rolls: It creates an image of precision and therefore it attracts many consumers.
• Designing and implementing an advertising campaign: There are several stages of batch production that allow costumers to alter the advertisement. Once again, it makes the advertisement to look unique.

Growth Strategy in Dispute at Traffic Clothing PLC

1. Use the case study to explain the difference between 'internal' and 'external' growth.

The main difference between internal and external growth is that internal growth is done within a business or a company while external growth is described as marging of two or more different companies. Therefore, it's done outside of a particular business. Using the case study, an example of internal growth would be the opening of low-cost factories in developing countries. On the contrary, taking over another clothing producer or material supplier would be an example of external growth. To be more specific, an example of the external growth would be a merger of the company with a prestige clothing retailer.

2. Explain how the business increased sales revenue, yet gained no increase in profits for the last three years.

Opening low-cost factories in developing countries helped to increase sale reveneu. However, there was no increase in profits for the last 3 years, This was due to several factors. For example: new competitors entered the industry and drove down prices. Another reason for no increase in profit was the rapid increase in prices of raw materials. Lastly, there was an increase in ther bargaining power that was done by the number of mergers between retailers.

Questions number 3 and 4 are higher level questions!

Ansoff's Matrix

Market Penetration:
Market Penetration is one of the objectives used in Ansoff's matrix. The potential gain of using this strategy is achieving higher market shares, possible increase in sales as well as improvements in  marketing. This can be done by selling existing product in an existing market, which obviously lowers the risk. However, even though market penetration is the least risky of the four strategies, companies using this strategy should still be careful. Since low prices are a method used to penetrate a market, it could eventually lead to a damaging price war that reduces overall profit of all firms in the particular industry.

Product Development:
This strategy is a bit more risky than market penetration. In order to develop and sell new products or new developments of already existing products in existing  markets, innovation of the product often must take place. This can be done by altering existing products to create something new and unique. Another possibility is to create completely new products. However, innovation of the product might lead to a distinctive identity of a business, which might be both positive and negative.

Market Development:
Market Development can be explained as a strategy used for selling existing products in new markets. This can be done by using geographic or demographic changes as well as by re-packaging for different market. To be more specific, this might include exporting goods to overseas markets. Even though that market development might be often a very successful strategy, it definitely contains a certain amount of risk too. Selling products in new markets might not always be appealing to a new range of customers. Therefore, it is recommended to do some research about a new market and its customers first.

Diversification:
Diversification is the process of selling different, unrelated goods or services in new markets by either looking for new markets for these new products or by diversifying into different products or services. This strategy is the most risky of the four strategies because it involves new challenges. A firm might later find out that it does not have enough competencies to survive in the particular industry. However, this strategy has several advantages too such as the possible reduction of overall business portfolio risk or the potential gain in an expanding industry.

The Analysis of the Starbucks' Article

"Starbucks Aims To Move Beyond Beans"

 Starbucks has been using several methods for growth of the company. They mostly have been using the internal or organic growth. One of the methods that Starbucks has been performing is expansion. By opening new stores in different parts of the world, Starbucks has become even more popular among the customers and they have increased their availability. They are also ready to open a string of stores that will be dedicated to the brand. Another method is diversification. Even though their main product making the most profit is still coffee, Starbucks has acquired three new business: Evolution Fresh Juices, La Boulange Cafe and Bakery, and lastly Teavana. The huge investment that Starbucks had to make will lead to an expansion of  the range of products Starbucks offers as well as it will give Starbucks an opportunity to compete in a different field of products. However, there are several obstacles that Starbucks should overcome in order to remain a successful company. One of the problems is that Starbucks stores were built to sell and offer coffee and not food and therefore, they are much smaller. Starbucks might start to thing about expanding their stores which would also cost them a lot of money. It doesn't have to be that much of an obstacle anymore, since lately they found how to squeeze freezers into all the Starbucks stores. On the contrary, Starbucks' primary business concentrating on coffee is most successful in the morning and by offering other new products such as healthy snacks, fresh juices and candies Starbucks might attract new customers and increase profit, which would balance their loss from the investment. In order to overcome obstacles, Starbucks started to pay lots of attention to detail. For example: Starbucks has been criticized by many consumers that the food they offer is not a good quality. Therefore, Starbucks had made sure  that one employee in each store is responsible for serving well baked and warm goods such as a chocolate croissant. The three related businesses, Evolution Fresh Juices, La Boulange Cafe and Bakery, and lastly Teavana, should make sure and be careful about not getting into a shadow by Starbucks dominant brand. They need to make sure they are being viewed as a brand instead of being viewed as an additional product line. Starbucks has had to invest lots of money into their expansion and diversification, and therefore they should keep being careful about what they are doing. The new range of products that they started to sell might affect (not necessarily in a positive way) their popular brand and a good image. 

  

Internal Growth (Articles)

1. How dukawallah family built top supermarket brand 
(http://www.businessdailyafrica.com/How-dukawallah-family-built-top-supermarket-brand/-/1248928/2031994/-/fqmaqwz/-/index.html)

Chandarana Food Plus supermaket has shown a clear example of the internal growth. In 1964, the founder of the supermaket, Shantilal Mulji Thakkar, opened his first grocery store. Shantilal was known as a seller who offered his costumers mainly spices, powders and brown paper packets of grains which later created a synonymom "Indian food and Spices" for his company. After Shantilal's death, his sons (Anil, Sanjay and Dipin) took the family business under control. By expanding the grocery that originally targeted only Asian community changed into a "Kenya's most affluent and niche supermarket brand." In the last 50 years, Chandarana Food Plus supermarket has grown from one branch to eight. Even the number of employees rapidly increased. From 12 employees to 500. Fifty years ago, Chandarana had been selling approximately 500 products. Now, they have been offering customers more than 20,000. Chandarana even managed to change their logo "Chandarana Supermarkets" to "Chandarana Food Plus". Internal growth that has been this family brand performing built one of the top supermarket brands!

2. Growing business by developing products and markets -  A Beiersdorf case study
(http://businesscasestudies.co.uk/beiersdorf/growing-a-business-by-developing-products-and-markets/growth.html#axzz2hotAZZ2m)

Beiersdorf is a skincare company behind many famous brands such as NIVEA, ELASTOPLAX, ATRIXO and EUCERIN. The company was first found in 1911 by German phermacist, Paul Beiersdorf. The first product they developed was NIVEA cream. This was the beginning of NIVEA, which is now considered to be one of the world's largest skincare brands. Their huge success is probably a result of a very good marketing strategy. For example: They have been regularly expanding their portfolio in line with changing consumer demand. To be more specific, in 1980s the company started to offer new products such as sun protection, soaps or bath and shower products. Another example of the company's internal growth is introduction of the first mass market male skincare brand called NIVEA FOR MEN. As NIVEA FOR MEN entered the market back in 1998, the company became even more successful among the costumers. It started to target not only women who like to pamper themselves but men too. Therefore, their target population increased and so did the sales. Beiersdorf has also expanded into many European economies which made the company and its products more available.

Franchising

There are several conditions such as recession that are either favorable or unfavorable for some franchise sectors. The most successful sectors are the following:

1. Fitness Centers: Nowadays, fitness is seen more like a necessity than a luxury. It has become more popular among the customers and therefore, also more available. Fitness Centers benefit mainly from membership-based model that provides consistent cash flow.

2. Healthcare: Healthcare franchise tend to grow during both good and bad times. Overpopulation is fueling them and makes them very successful

3. Fast-Food Restaurants & Convenience Stores: These franchises often offer discounts and specials that cause them to be very popular among consumers. The most successful are hamburger, pizza and doughnut restaurants.

Other franchises such as tax services and educational programs are also doing pretty good.

Sectors that are less successful are the following:

1. Financial Services: These franchises were hit by finance crisis and even though they started to recover since 2010, the recover is still very slow, especially for banks.

2. Real Estate Services, Property Inspection, Hardware Stores: The main reason of them being still in decline is that the real estate market is still struggling.

3. Automotive: Decreased traffic volume and high gas prices causes auto-related franchises to lose units.

Other less unsuccessful franchises are for example: video rental or general printing services

Home-based franchise - Jan-Pro Franshing Int'l. Inc:

They offer commercial cleaning services to businesses such as gyms, banks, schools, churches. They use cleaning products that contain less chemicals. The advantage of home-based franchise is that it can be run from home. Another advantage is that the number of  employees needed to run one unit is only one.

Low-cost franchise - Novus Glass Franchise:

This franchise began franchising in 1985. They came up with an idea that instead of replacing windshields that could start repairing them. Therefore, this franchise offers windshield repair system.The advantage of this franchise is that they are seeking for new franchises units in many countries such Mexico, Canada, Western Europe or New Zealand.Also 20% of all franchisees own one unit and this franchise can be also run from home.

The franchise ranked in the top 100 overall - McDonald's:

They are a fast-food restaurant that offers quick-service hamburgers, fries, milkshakes, chicken, salads and breakfast items. There are several factors that make this franchise successful. First, McDonald's is an internationally-recognized brand thanks to their availability. They have franchises all around the world and by serving food quickly they became very popular among the customers. By offering children's menu called "Happy Meal"containing a little toy they gained children's attention too. Interestingly enough, franchiser is still seeking new franchises units worldwide. 80% of all franchises own more than one unit.

PEST Analyis for QSIB!

Political:

1. Education Law: There is a law in Slovakia that says that a student must attend school for at least 10 years. This is very positive for a school such as QSIB because if the school keeps a good quality and keeps making both parents and students satisfied, students will attend the school at least for 10 years Therefore, QSIB could be counting with annual tuition fee and made a profit. Plus if there was no such a law, probably less students would attend schools (in general). Since, it is mandatory to attend schools, students and parents have at least the right to pick which one and might rather prefer an American private school over a normal Slovak school.

Economic:

1. Taxes: Taxes in Slovakia have been rising because of the  huge debts our government has. Prices and taxes both have increased but salaries have stayed the same. This is very negative for private schools and for QSIB because people might rather want to save money than invest into education of their children. There's still many ordinary schools in Slovakia which are for free and even though they are probably not as good as QSI, parents do not have to pay for education of their children. Less students in QSIB means fewer money, and therefore a smaller profit.

2. Unemployment Rate: One of the most positive things that have impact on QSIB is a lower unemployment rate in Slovakia. As research has shown, unemployment rate keeps still decreasing, which means more people have jobs. Therefore, some of them might consider to put their children into a private school such as QSIB.Also, decrease of unemployment has a positive impact on the economic growth of Slovakia.

Socio-cultural:

1. Population-growth rate: Population-growth rate slowly increases, which has once again a positive impact on QSIB as well as on Slovakia. Increase in population-growth rate basically means that more children are born. These children will must attend school and some of them will maybe consider QSIB!

2. Population ages 0-14: On the contrary, population of children of age 0-14 keeps decreasing, which is negative because less children attend school. Even though population of teenagers is increasing, QSIB is generally looking for younger kids as they attend school for a longer period of time.The longer the child attends QSI, the more money QSI makes.

Technological:

1. Companies: Huge foreign companies such IBM, KIA or SAMSUNG have opened their stores in Slovakia, which is great for Slovaks who are looking for a job. This causes the unemployment rate to decrease. Plus it helps to stimulate education too Having these huge companies here in Slovakia can also help to develop technology in schools. Although, probably not in QSIB.

2. Technological advances: Even though improvements in technology give you the ability to manage and control the stores and everything globally, they also replace people. Then people lose their jobs and are unemployed, which means they have less money. They probably will not invest that much into education of their children.

Leadership Theories

Likert's Four Leadership Styles

The main idea of this theory is to identify the main styles, which focus on how decisions are taken by management as well as on how much people are involved in decision-making. 

1. Exploitative authoritative: the leader shows little concern for his employees and often uses fear-based methods to maintain certain discipline and to ensure that the employees conform with decisions. Communication is one-way through the organization.

2. Benevolent authoritative: decision-making is centralized. The leader shows concern for his employees and uses rewards to motivate and encourage them. Even though there is two-way communication, staff often says what they think their manager wants to hear. The leader takes decisions on all major issues. 

3. Consultative:  the leader listens to the the views of his employees.  Decision-making is done centrally. However, employees' opinions or ideas may be often ignored.

4. Participative: the leader makes full use of participating methods of decision-making. There tends to be closer working between employees across the organization.

Fiedler's Contingency Theory

This theory addresses a concept that shows the relationship between a leader's style and group performance under differing situations. Fiedler identified 2 broad types of leader orientations:

a) relationship-oriented 

b) task-oriented

He divided leaders into these categories depending on their score on a sliding numerical scale-LPC (least preferred co-worker) For example: the leader is unfriendly (1); the leader is friendly (8). A high LPC score indicates a relationship-oriented leader,  who is concerned wit personal relations while a low LPC score indicates a task-oriented leader, who is impatient and eager to get on with a job.

Blake and Mouton Managerial Grid
They proposed the notion of managerial grid that contains five management styles based on the leader's relative concerns for the employees or production.

1. Country club leadership: the leader is concerned about the needs of the team.

2. Produce or perish leadership: the leader views employee needs as secondary to production targets and fear of punishment is considered to be the best way to motivate workers.

3. Middle of the road leadership: Neither people nor production needs are fully met, which makes a compromise. Thia style is used for average performance.

4. Impoverished leadership: this leader is the least effective. There is no concern for getting the job or for meeting the needs of the employees. The result is disorganization and dissatisfaction.

5. Team leadership: the pinnacle of leadership styles. Workers are involved in understanding organizational purpose and therefore are committed to the success of the organization.

Tannenbaum and Schmidt (A leadership continuum)
These two writers developed a continuum of control and decision-making, shared between a leader and followers.

a) the use of a leader's authority with little participation

b) freedom for subordinates with limited input from the boss

The amount of control each party has depends on on the leader's assessment of the degree of responsibility that the followers are willing to take on. Tannenbaum and Schmidt argued that leaders can retrieve some control if an emergency situation arises for which the subordinates have no experience.

Electronic Communication At Work

Advantages:

• an easy and effective communication with anybody anywhere in the world.
• you can respond to clients quickly and easily
• messages can be sent in an instant
• the cost of sending emails is very low comparing to other form of communications (such as phoning) 
• use of emails is very simple
• you can send distinguish attachments such as photographs or spreadsheets
• it speeds up the workflow process
• it also saves time because you don't need to go to another office to talk to the person
• email saves papers, and therefore trees; it also save printing cost

Disadvantages:

• spam emails can be sent which are dangerous because their can clutter the computer
• email hoaxes
• many viruses can be sent via emails which can eventually destroy your computer
• not everyone has internet connectivity
• if you send the emails to someone else, then the confidential information might end up in the wrong hands
• employees might get tired of the emails and they might stop reading them thinking they are not important

The Four P's (Price, Product, Promotion and Place)

Price

World's Most Admired Companies

Apple:

Even though Apple has had a rough time with its stock price in a free fall and with failure of it Maps feature, it still remains the most profitable company in the world. Last quarter its net income was $13 billion. The company still refuses to decrease their prices. Despite its high prices iPhone 5 became the world's best selling smartphone and was followed by the iPhone 4S. This article clearly relates to price as it talks about Apple's net income which makes the company to be the most profitable.

The reason why Apple Inc. was ranked as Number 1 world's most admired companies is because of its huge profit and undeniable popularity among the consumers. Even extremely high prices of Apple's product do not discourage consumers from buying them. Consumers buy Apple products not only because of the product's quality, luxury design but because of the feeling of being "cool" that the product give them. I'm sure that if Apple Inc. keeps producing and developing new devices and upgrading the older ones, the consumers will like them and buy their product. I would not recommend Apple to decrease their prices because it might ruin their brand name.

Product

What Makes Samsung Such An Innovative Company? 

Many people do not understand how Samsung approaches innovation so they started to criticize them for copying. It's publicly known what kind of strategies Apple or Google use. For example: Apple often assigns three teams that compete with each other and Google gives engineers more bench time. On the contrary is seems like the reason why Samsung is such an innovative company is that its strategy is based on creating elite. Samsung realizes the importance of innovation and is willing to invest lots of money into it. In late 1990s and early 2000s Samsung started to think about adopting a systematic approach to innovation which seemed to be a main reason for their current success. Samsung has also become a partner with Russian Academy Of Science. Because of the company's willingness to grant enough visas Samsung has been able to buy Russian expertise for a quite low price. Russian experts help Samsung with its smart-phone software development. They have also introduced and recommend to Samsung TRIZ, which is a methodology for systematic problem solving. By using TRIZ Samsung saved over $100 million in its first projects. It looks like Samsung is on a roll. The article "What Makes Samsung Such An Innovative Company" relates to product. Even though this article doesn't talk about the specific product of it focuses more on the company and its strategies for improving and innovating several products instead of just one. It reveals us the ways Samsung develops its products which is very important and interesting. It is obious that Samsung uses company or corporate branding.

The reason why there's many critics about Samsung is that some people still do not undestand how come that Samsung can easily compete with American masters like Google and Apple. The truth is that Samsung strongly focuses on quality of its products as well as on innovation. It may not concentrate as much on design though (comparing to Apple Inc.). The reason why Samsung has chosen Russia as partners is that Samsung recognizes it as a country in which technology develops rapidly. Samsung knows that in order to be successful it is neccessery to keep developing and improving its products. In my opinion Samsung will continue cooperating with Russian Academy of Science and improving their products. If Samsung starts working more on its products design, the company might become among the customers even more popular than Apple as Samsung offers lower prices. So I would recommend Samsung to start playing with the design more. 

Promotion

Chavez's death won't spur new Venezuela oil drilling

In the 1990s, Venezuela's democratically-elected governments that were seen as quite stable comparing to oil-rich countries (the Middle East, Russia) attracted many foreign investors from all around the world such as U.S. oil giant Conoco Phillips. However, thanks to the oil industry's biggest villain, Hugo Chavez, who expropriated lands and equipments from foreign oil companies and eventually managed to destroy Venezuela oil company, overall Venezuelan oil output started to decline. Because of his stupidity and corruption, Chavez completely devastated the good image of Venezuela. Even though that Hugo Chavez's death did definitely rock the oil industry, it did not make any change in Venezuelan dysfunctional energy industry as well as in its incapable and poor reputation. This article relates to promotion. It's a clear example of negative promotion that was caused by the president of Venezuela, Hugo Chavez. Venezuela used to be one of the largest oil reserves on the planet but Hugo Chavez's actions created bad images of this oil giant which made the consumers like ExxonMobil to stop buying oil from them.

There were several reasons for the decline of Venezuelan oil output:

1. Hugo Chavez started making financial frauds. For example: PDVSA (Venezuela's state oil company) has paid hundreds of millions less to Exxon Mobil Corp than they were supposed to. Chavez's explanation was that the difference reflected the debt owed by Exxon Mobil Corp to PDVSA.

2.Venezuelan oil production had suffered under Hugo Chavez

3. He also trashed contracts with many foreign oil partners.

In order to increase the overall Venezuelan oil output and to create a good image of this oil reserve a new president of Venezuela will need to dismantle the policies, rhetoric and structure. An effective promotion will be very important too. Venezuela cannot afford to make another bad step. It might take some time for the Venezuelan government and PDVSA to become third largest oil exporting giant again but they have to try and work on it systematically.  If the new government was stable, it might attract new foreign investors again.

Place 

Apple to open its own stores in Russia

Apple Computers plans to sell its products in Russia without the use of any middlemen. Apple has already registered a company Apple Rus and assigned Vitaly Morozko as its director general. One of the Apple managers assumes that the company could start direct sales in Russia in 2013 but nobody knows when the first Apple Store in Russia will be open. Apple's first official Russian distributor was diHouse and most of the Apple products are still distributed through this distributor. iPhones are in Russia distributed by MTS and Vimpelcom.The statement that says prices of Apple products will fall as Apple Store comes in Russia is false. Apple Inc. is not planning to decrease their prices. The only benefit Russia might get from having Apple Store is that there will be probably a smaller delay between announcing a new Apple gadget, and its appearance on the Russian market. This article is related to place as it talks about Apple Inc. and selling their products in Russia. It also reveals that Apple is interested in building the Apple Store in this huge country.

By selling Apple products and opening the Apple Store in Russia, Apple Inc. wants to become even more popular and to make sure their products are available everywhere. Even though Apple products have been already distributed to Russia, opening of the plushy Apple Store will definitely attract even more consumers. Another reason for building Apple Store is that some distributors such as Vimpelcom and MTS want the phones to be sold in their shops only and are not interested in any wider market. I think that if Apple joins Samsung and Sony, companies that have been already working on direct contracts, the prices might become more affordable in the future.