3 ethics and social responsibility professor close
TRANSCRIPT
3Ethics and Social Responsibility
Professor Close
Corporate Social Responsibility (1)
• CSR = businesses’ concern for societal welfare
• Ethics = moral values guiding a leader or organization
• Morals = rules developed by cultural values/norms
• Can you think of any companies that practice CSR?
Corporate Social Responsibility (2)
• Happy people = good business
• If you have to ask “is this ethical?...” it likely is NOT cool
• Need to rethink long terms
solutions
Marketing Environment (1)
• Factors outside our control in the short run (CPA)
• Consider the strategy (where are the opportunities?)
• Broad objectives: beyond pleasing our customers
Marketing Environment (2)
• Broad objectives:– Useful function (Wang computers)
• Need satisfaction (Hallmark)
• PR purposes (RJR vs. Alcohol)
– Organization to support• Entrepreneur’s challenge
• Example: organization charts
– Profit (#1, long run)• Other financial subordinate (market share, Eastern)
• Time horizon: When will firm generate profit? (Amazon)
• Considers resources (how many years)
Marketing Environment (3)
• Compatibility is a key
• Question to consider: do you think Wal-Mart can focus on both quality and price? What about their labor issues?
Simpsons on Wal-Mart
Marketing Environment (4)
• Resources: remember 2x2 matrix; how to find strong areas– Examine functional areas
• Financial: Wal-Mart (purchasing)• Production:
– Larger capacity (cost/unit, economy of scale)– Flexibility (Sara Lee and what else?)– Often opposed
• Marketing:– Brand strength – Channel relationships (car dealers, franchisees, and
what else?)
Marketing Environment (5)
• Preferable Combination– Example: Wal-Mart - financial, distribution,
and relationships– What other example can you think of that has
a strong combination?
Finding Opportunities (1)
• Types of opportunities:– Market penetration
• Current products and markets• Examples include
– Increase rate of use (shampoo, Coke, and what else??)– Longer duration (airlines and what else??)
• Advantage of market penetration is that it is the easiest method
• Disadvantage is the threat of saturation
Finding Opportunities (2)
• Types of opportunities:– Market development
• Current products, new markets• Example: international expansions
– What successful or unsuccessful international expansions can you think of?
• Advantages include high potential• Disadvantages include applicability (KFC in Japan)
Lipton is Asia…Think it will work?
Finding Opportunities (3)
• Types of opportunities:– Product development
• Current markets, new products• Examples: autos, fashion, and what else??• Advantages include knowing the customer already• Disadvantages include cannibalization (Gillette)
Finding Opportunities (4)
• Types of opportunities:– Diversification
• New market and product• Examples: McDonalds and what else??• Advantage includes high potential• Disadvantage include high risk (ITT – Sheraton)
Social Factors
• American values (upward mobility, work ethic, self-sufficiency, conformity)– Culture: manner in which people live– Very broad
• Women’s role (U.S. vs Japan)• Fitness• Debt• Time-poor society
Economic Factors
• Economy: a system of producing, distributing, & consuming wealth (what is our purchasing power?)– Shifts (purchasing declines in recession)– Examples:
• Interest rates influence buying (0% financing)• Rising costs, inflation unavoidable
– Good life = debt?– Why are we so in debt?
Technological Factors
• Technological: application of knowledge to perform tasks more efficiently/effectively
• Effective: accomplishing tasks• Efficient: accomplishing tasks with minimum use of
resources
– Base of economic environment (research)– Technology transfer is rapid (Pentium chips
and what else?)• RSS and blogging
– Ethics: consumer research (hits on web sites, selling your info, privacy??)
Technology Changing Lifestyles
Political Factors
• Political– International
• Nationalism: emphasis on “our” country influences trade (buy American)
• Trade groups: ease trade among members– EU – lowers trade barriers among European nations
(looking East)– NAFTA – Canada, U.S., and Mexico– What do you see as the advantages and disadvantages
of each?
• Consumerism– Champions individual vs company– Ralph Nader – unsafe @ any speed
Legal Factors (1)
• Legal (close with political)– Philosophy:
• Competition is encouraged• Federal law conveys intent, but not detailed
interpretation
– Sellers must:• Tell the truth• Meet contracts
Legal Factors (2)
• Legal (continued)– Regulations:
• Food and drugs must be safe & sanitary• Magnuson-Moss Act: warranties• Robinson-Patman Act: price discrimination• Consumer Product Safety Commission (sets
standards)– Protects from unsafe products (bicycle – unsafe)– Stricter on children
• State/local laws vary (California)
– Let the buyer beware (pro-consumer)
Should this be an illegal ad?
Competitive Factors
• Competitors– Fight for market share or profits– Tend to become similar (sodas, beer, any
others?)– Competitive barriers
• Position difficult to copy (any area of firm)• Marketing helps maintain distinction (image, etc)• Can usually avoid “head on” competition
– We love competition, why?
Who Killed My Little Pony?
Summary• Marketing environment and strategy• Six environments
– Social– Economic– Technology– Political– Legal– Competitive
• Note: we will over demographic factors in a following unit.
• Any questions?