MNB1601_STUDY_GUIDE

CONTENTS PREFACE v TOPIC 1: OPERATIONS MANAGEMENT 1 LEARNING UNIT 1: The operations management function 3 1.1 THE NATURE AND DEFINITION OF OPERATIONS MANAGEMENT 4 1.2 AN OPERATIONS MANAGEMENT MODEL 5 1.3 THE CLASSIFICATION OF OPERATIONS PROCESS TYPES FOR MANUFACTURERS AND SERVICE PROVIDERS 7 LEARNING UNIT 2: Operations management: activities, techniques and methods 11 2.1 OPERATIONS DESIGN 12 2.2 PLANNING AND CONTROL OF THE OPERATIONS PROCESS 15 2.3 OPERATIONS IMPROVEMENT 16 TOPIC 2: HUMAN RESOURCE MANAGEMENT 23 LEARNING UNIT 3: Meeting human resource requirements and developing eff ectiveness in HR 25 3.1 THE RELATIONSHIP BETWEEN LINE MANAGEMENT AND THE HR DEPARTMENT 26 3.2 HR PLANNING 27 3.3 FINDING QUALIFIED TALENT 28 3.4 DEVELOPING TALENT 30 3.5 RETAINING TALENT 31 LEARNING UNIT 4: Motivating employees 38 4.1 EMPLOYEE MOTIVATION 39 4.2 EMPLOYEE MOTIVATIONAL STRATEGIES 43 4.3 THE LEGAL ENVIRONMENT 43 TOPIC 3: MARKETING MANAGEMENT 49 LEARNING UNIT 5: The marketing process 51 5.1 THE NATURE OF MARKETING AND THE MARKETING PROCESS 52 5.2 EVOLUTION OF MARKETING THOUGHT 54 5.3 CONSUMER BEHAVIOUR 57 5.4 MARKETING RESEARCH 60 5.5 MARKET SEGMENTATION, TARGET MARKETING AND POSITIONING 62 LEARNING UNIT 6: The marketing instruments 68 6.1 PRODUCT DECISIONS 69 (iv) 6.2 PRICE DECISIONS 72 6.3 DISTRIBUTION DECISIONS 74 6.4 MARKETING COMMUNICATION DECISIONS 76 6.5 CUSTOMER SERVICE 81 TOPIC 4: FINANCIAL MANAGEMENT 87 LEARNING UNIT 7: The fi nancial function and fi nancial management 90 7.1 THE FINANCIAL FUNCTION AND FINANCIAL MANAGEMENT 91 7.2 CONCEPTS IN FINANCIAL MANAGEMENT 92 7.3 OBJECTIVE AND FUNDAMENTAL PRINCIPLES OF FINANCIAL MANAGEMENT 94 7.4 COST-VOLUME-PROFIT RELATIONSHIPS 94 7.5 THE TIME VALUE OF MONEY 96 7.6 FINANCIAL ANALYSIS, PLANNING AND CONTROL 97 LEARNING UNIT 8: Asset management: the investment decision 102 8.1 THE MANAGEMENT OF CURRENT ASSETS 103 8.2 LONG-TERM INVESTMENT DECISIONS AND CAPITAL BUDGETING 105 LEARNING UNIT 9: Financing decisions 112 9.1 FINANCIAL MARKETS 113 9.2 SHORT-TERM FINANCING 114 9.3 LONG-TERM FINANCING DECISIONS 115 TOPIC 5: THE PURCHASE AND SUPPLY FUNCTION 119 LEARNING UNIT 10: Purchasing and supply management 121 10.1 PURCHASING AND SUPPLY IN PERSPECTIVE 123 10.2 THE IMPORTANCE OF THE PURCHASING AND SUPPLY FUNCTION FOR THE BUSINESS 124 10.3 THE MANAGEMENT TASK OF THE PURCHASING AND SUPPLY MANAGER 125 LEARNING UNIT 11: Sourcing activities 131 11.1 THE PURCHASING AND SUPPLY PROCESS 132 11.2 QUALITY DECISIONS AS A PURCHASING AND SUPPLY ACTIVITY 135 11.3 DECIDING ON PURCHASING AND SUPPLY QUANTITIES 136 11.4 THE SELECTION AND MANAGEMENT OF SUPPLIERS 137 11.5 PRICING DECISIONS 138 11.6 TIMING OF PURCHASES 138 (v) MNB1601/1 PREFACE 1 INTRODUCTION 4Welcome to the module Business Management 1B (MNB1601). To make your studies easier, and to help you share in our enthusiasm for this fi eld, we urge you to read this Study guide. You should also read through Tutorial Letter 101. Refer back to these study materials as often as you need to, throughout your studies. 5The fi eld of management is extremely dynamic and challenging, so we have inserted additional reading material and case studies, over and above the learning content in this Study guide. This will provide you with opportunities to explore the latest developments in the fi eld of business management, and will help you to discover management as it is practised today. 6Although you are studying on your own, please contact your e-tutor and/or your lecturer if you have any problems with this module. Your lecturers’ contact details appear in Tutorial Letter 101, as well as in the welcome message on myUnisa which is also available in this document. You will receive information concerning your e-tutor later in the semester. We urge you to make use of myUnisa and participate in the discussion forums and online activities. We hope that you will enjoy this module. 7IMPORTANT: Most of the online content (previously available in a study guide) is available in this document. Visit myUnisa regularly, as important information will be communicated to you via announcements throughout the semester. Certain sections or text in this document appear in light grey scales, but they are presented in colour on myUnisa. Visit myUnisa for a comprehensive experience of the material. 2 PURPOSE OF THE MODULE 8The purpose of this module is to develop learners’ understanding of the individual functional areas of business management which ultimately form a synergistic whole that directs the business towards its goals. These functional areas are human resources, marketing, fi nance, operations and purchasing. 3 LINK TO OTHER MODULES 9This module does not stand alone; it is an integral part of the BCom degree in Business Management. Therefore, the learning objectives of this module are aimed at developing your expertise and abilities in the fi eld of Business Management. This module in Business Management (MNB16011) will provide the foundation for the next module in management which is prescribed for the second year, namely MNG2601 (General Management). You (vi) would normally continue your studies with the two strategic management modules in the third year (MNG3601 and MNG3602) if you want to specialise in management. 3.1 OBJECTIVES AND COMPETENCIES 3.1.1 Module objectives 10When you have worked through this module you should be able to: - manage the operations of a business by using sound operational activities, techniques and methods to optimise the transformation of inputs into outputs - explain how human resource requirements can be met and how eff ective human resources can be developed - explain how human resources can be motivated and managed - describe the marketing process - explain the marketing instruments of product, price, distribution and marketing communication - apply fi nancial management concepts and principles relating to fi nancial analysis, investment decisions and fi nancing decisions in order to achieve continued fi nancial health in a business - plan, organise and control the purchasing and control function in such a manner that it helps to achieve the objectives of the business 3.2 OUTCOMES & ASSESSMENT CRITERIA Outcomes Assessment criteria Specifi c outcome 1: Operations management The learner should be able to: (a) explain the nature of operations management by highlighting the importance and providing a defi nition of the operations function, distinguishing between the various components of an operations management model, and describing a classifi cation system for the diff erent operations processes for manufacturers and service providers (b) demonstrate how the operations activities of design, planning and control, and improvement are performed within the operations function by illustrating the application of various operations techniques and methods Specifi c outcome 2: Human resource management The learner should be able to: a) explain how the human resource department assists line managers to achieve the organisation’s goals by ensuring that the organisation has employees with the necessary qualifi cations, knowledge and experience when they are needed (b) demonstrate how human resource management contributes to employee motivation (vii) MNB1601/1 Specifi c outcome 3: Marketing management The learner should be able to: (a) demonstrate an understanding of the marketing process by highlighting its components (b) formulate the decisions involved when designing the marketing instruments by summarising the inherent elements of product, price, distribution and marketing communication decisions Specifi c outcome 4: Financial management The learner should be able to: (a) demonstrate an understanding of the concepts of capital, income, cost and profi t (b) analyse and interpret the statement of fi nancial performance (c) analyse and interpret the statement of fi nancial position (d) perform a breakeven analysis (e) apply the principles of the time value of money by demonstrating the concepts of discounting and compounding (f) calculate and interpret the liquidity, solvency and profi tability ratios by using a statement of fi nancial position and statement of fi nancial performance (g) understand the management of current assets (h) evaluate long-term investment decisions using capital budgeting techni