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1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s...

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1 Chapter 3 Instructor Shan A. Garib, Fall 2012
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Page 1: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

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Chapter 3 Instructor Shan A. Garib, Fall 2012

Page 2: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Corporate Social Responsibility: a business’s concern for society’s welfare-reflects consideration of long-term interest of both company and it’s relationship to society-simmilar to market oriented firms but with a larger focus-business needs rich people to buy their goods/services so need to help to poor

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Page 3: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Four Components of Total Corporate Social Responsibility:

1.Economic2.Legal3.Ethical4.Philanthropic

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Page 4: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Ethics: Moral principles and values that direct behaviour

-personally held

Morals: rules people develop as a result of cultural values of norms

-characterized as good or badeg. Selling to disadvantaged customer

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Page 5: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Morality and Business Ethics

-The values of business people have been acquired through family, education and religion

-To develop a personal set of ethics:-evaluate the consequance of a

particular act -stress importance of rules

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Page 6: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Morality and Business Ethics

-To develop a personal set of ethics:-evaluate the consequance of a

particular act -stress importance of rules, laws

-develop moral character through:1. preconventional morality2. conventional morality3. postconventional morality

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Page 7: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Ethical Decision Making is influenced by:

1.Extent of ethical problems in the organization

2.Top management ethics3.Potential magnitude of consequences4.Social consensus5.Probability of a harmful outcome6.Length of time to consequences7.Number of people affected

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Page 8: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

(Code of) Ethical Guidelines to help managers make better decisions

Advantages:1. Employees see what their firm thinks is acceptable 2. Effective internal control on behaviour as opposed to external like the government3. Avoid confusion

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Page 9: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Understanding the External Environment

-Managers must constantly change the marketign mix (4P’s) to reflect the ever changing environment

-This is doen through “environmental scanning”

-Goal: identify future opportunities and threats!!

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Page 10: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Environmental Management: sometimes the company can impliment strategies that influence the environment

-done through lobbying-environmental factors include:

-social-demo-economic-tech-political, legal

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Page 11: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

-Hardest to infulence and change

-they influence what you buy, prices paid...

-examples are: consumer attitudes, values and lifestyles

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Page 12: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Market-oriented ValuesValue: a strongly held belief, determines what is important and not importantFour values influencing our lifestyles and attitudes:

1. self-sufficiency – stand on own feet2. upward mobility – work hard, you get it3. work ethic – hard work is moral and right4. conformity – noone should expect to be

treated differnetly from anyone else

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Page 13: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Values influence our buying habits.-consumers insist on hogh quality products-ranking characteristics of product quality:

1. reliability2. durability3. easy maintenance4. ease of use5. a trusted brand name6. a low price

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Page 14: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

The growth of component lifestyles-choosing products and services that meet diverse needs and interestsEg. Banker/biker

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Page 15: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

The changing role of families and working women

Duel incomes means greater purchasing power!

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Page 16: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Demography: study of people’s vital statisitcs-strongly related to consumer behaviour-each age froup has own tastes and biases

Tweens: 9-14Generation Y: 79-94, tech, clothes

-diverse-savvy-impatient

Gen X: 66-78-spending varied, 40 are money making years

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Page 17: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Demography: study of people’s vital statisitcs-strongly related to consumer behaviour-each age froup has own tastes and biases

Gen X: 66-78-spending varied-40’s are money making years

Boomers: 47-65-largest segment-biggest spenders-brand hop

50% of population now in larger cities

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Page 18: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Ethnic and Cultural Diversity

Multiculturalism: major ethnic groups in an area are equally represented

-mostly in larger urban areas-cmopanies change their marketing

programmes to relfect this change eg. CIBC, hospitals

-25% of visible minority population is under 14, and will be able to converse in multiple languages

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Page 19: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Three areas of concern for marketers:

1. consumers’ incomes

2. inflation

3. recession

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Page 20: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Three areas of concern for marketers:

1. consumers’ incomes

2. inflation

3. recession

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Page 21: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Three areas of concern for marketers:

1. consumers’ incomes-median income for a family is 58k CAD-education primary determinant of

earnign potential-Income, willingness to buy, ability to buy

determines target marketeg. dollar store in lower income

neighbourhoods

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Page 22: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Three areas of concern for marketers:

1a. consumers’ incomes-credit cards allow lower and middle income

earners to live like the rich

1b. purchasing power: comparing income to cost of things

-or, income minus cost of livingeg. Prices in Nova Scotia 3x less than in

Toronto. If make the same as worker in Toronto then can afford more

-more disrectionary income

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Page 23: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Three areas of concern for marketers:

2. inflation: decrease in value of money or, increase in prices

eg. Choc bar $1 then goes up to $1.05 inflation rate is 5%

-if salary raises are 5% then same purchasing power before the change as after

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Page 24: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Three areas of concern for marketers:

3. Recession: negative frowth in economy for 6months+

-reduction in demand for goods/services-different marketing approach:

1. improve products, or new ones2. expand customer service3. emphasize top of the line and

promote product value

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Page 25: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

External technology important to marketing managers:

1. by acquiring technology, more efficient operation or create a better product

2. new technology may render existing technology obsolete eg. Camera film

-staying technologically relevant means managers need to do research and adopt new technologies

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Page 26: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Staying technologically relevant means managers need to do research and adopt new technologies

Research: expand knowledge, confirm exisiting theory

Applied research: develop new or improved products

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Page 27: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Federal Legislation affecting how business is conducted is administered through the competition bureau

-enforces laws covering: bankruptcy, trade practices, competition, credit, labelling, packaging, copyrights, trademarks and patents

Provincial Laws: different laws for different provinces eg. Quebec language laws

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Page 28: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Self-regulation: indusrty groups that police themselves

eg. CMA developing guidelines and ethical practices

Consumer Privacy-Every firm should be able to justify the type and use of information it has-Privacy Act and Personal Information Protection and Electronic Documents Act: protect privacy of personal information for collection, use and disclosure

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Page 29: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

The competitive environment is made up of:

1. Number of competitors

2. Size of competitors

3. Degree of interdependance

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Page 30: 1 Chapter 3 Instructor Shan A. Garib, Fall 2012. Corporate Social Responsibility: a business’s concern for society’s welfare -reflects consideration of.

Competition for Market Share and Profits

-As population grows, costs rise, resources limited firms have to work harder to maintain profits and market share!!!!!

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