Business

l ib r a r y e d it i o n

BUSINESS

Features That Enhance Learning

IN S ID E BUSINESS

Frito-Lay Com petes in a Healthy W ay (C H l)

H om e D epot Builds a Better Com munity (C h2)

Heinz: Fifty-Seven Varieties in Over Fifty

Countries (CH 3)

N othing but N et at Netflix (CH 4)

General Electric Grows into Its Second

C entury (Ch5 )

C arol’s D aughter Grows U p with Beauty (Ch6 )

D o Founders Make Good CEOs? (CH 7)

Global H yatt Gets Organized (CH 8)

H igher Quality and Teamw ork Drive H igher Sales

at Hyundai (CH9)

Diversity T ops the M cD onald’s M enu (C H lO )

I Love M y Job: Keeping Employees Happy and

Productive ( C H ll)

Labor Disputes Spark M ajor League Strife (C H 1 2 )

W h at’s “C ool”? W ho Says So? (C H 1 3 )

T h e Apple o f My iPod (C H 1 4 )

Dell: D irect and N ot-So-D irect (CH 15)

Pizza Prom otions Put the H u t on T o p (Ch 1 6 )

Inform ation Systems at H arrah’s

E ntertainm ent (C H 17)

C ounting on the Big U.S. Accounting Firms (C H 1 8 )

C om merce Bank W oos Custom ers with a “W ow ”

Experience (CH 19)

Bowie Bonds M ake Music Pay O ff for Stars and

Investors (C H 2 0 )

Charles Schwab Teaches Investors (C H 2 1 )

YOUR CAREER

M aking the M ost o f a M entor Relationship (C H l)

Are You Ready for a Global Job? (C H 3)

T h e New Role of C hief Privacy Officer (CH 4)

C orporations D epend on Investor Relations (CH 5)

T h e H eat Is O n—and You’re the Decision

M aker (CH 7)

Five T ips for Custom er Service Success (CH 9)

H ere’s How to N egotiate for H igher

Com pensation (C H lO )

M ake Your Job Application Stand O ut ( C H l l )

W ould You Make a G ood M ediator or

Arbitrator? (C H 1 2 )

M arketing M e (C H 1 3 )

Employee Alumni Stay in T ouch (C H 1 7 )

Knowing the N um bers (C H 1 8 )

Is Fundraising a C areer Fit? (C H 2 0 )

E X A M IN IN G ETHICS

Can Businesses Keep Your Personal Inform ation

Safe? (CH 2)

Coping with C om puter Viruses (CH4)

W hat Makes an Ethical Leader? (CH 7)

C E O Compensation: How M uch Is T o o

Much? (C H lO )

Keeping Employees Safe ( C H l l )

A M atter of Trust: Dell Rebuilds C ustom er

Relationships (C H 1 3 )

Cookie M onster (C H 1 4 )

T o o M uch Inform ation (C H l5 )

Subway Closes the Club (C H 1 6 )

W hy Fudge the Figures? (C H 1 8 )

Bank Lending Goes G reen (C H 2 0 )

T he Backlash over Backdating (C H 2 1 )

( ^ B U S IN E S S AROUND THE WORLD

Flying the Frightening Skies (CHl)

D iscount Airlines Are Flying H igh (CH 3)

e-Businesses G o G lobetrotting (CH 4)

International M ergers and Acquisitions Face

Protectionism (CH 5)

D o’s and D on’ts o f International Franchising (CH6)

PepsiCo Faces a Credibility Crisis in India (CH 7)

Multinationals Grapple with Global Authority (Ch8)

Steering Tow ard H igher Productivity (CH 9)

C hina’s Labor M ovement: Is It Helping

W orkers? (c h 1 2 )

Accept N o Imitations: Fighting Fakes (C H 1 4 )

T his Global Bazaar is Right on T arget (C H l5 )

A ccounting Standards G o Global (C H 1 8 )

M icroloans H elp Launch Microbusinesses (C H 1 9 )

Foreign Investments: G etting Your Share o f the

W orld (C H 2 1 )

O

B IZTE C H

D ifferent Paths to e-Profits (CHl)

Reduce, Reuse, Recycle Your e-W aste (CH 2)

Goodbye Cell Phone, H ello W i-Fi Phone? (CH6)

H igh-T ech Firms Practice Cubicle Culture (C h8)

Employee T raining Goes Virtual (C H lO )

Telecom m uting: By the N um bers ( C H l l )

W ho's Blogging—and W hy? (C H 1 2 )

T alk Is Cheap: O nline T elephone Services (C H 1 4 )

Coupon Trends: Click or Clip? (C H 1 6 )

Log O n and Learn (C H 1 7 )

eM oney Cashes in with Paperless Payments (C H 1 9 )

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^ E N T R E P R E N E U R IA L CHALLENGE

It’s 6 a.m., D o You Know W here Your

Coffee Came From? (Ch 2 )

Connecting Global Partners (CH3)

Incubators Give Entrepreneurs a Head Start (CH5)

W ie n Should Entrepreneurs Use

Outsourcing? (CH 6)

Five W ays to Improve Delegation (CH8)

A Small Business Makes a Big Breakthrough (CH9)

Building a Business on eBay (C H 1 3 )

E ntrepreneurs Break into the Big T im e (C H 1 5 )

Podcasting—N o t Ju st for Big Business (Ch 1 6 )

T h e Rise of Craigslist (C H 1 7 )

Collection Practices T h at Pay O ff (C H 1 9 )

Finding the M oney (C H 2 0 )

VIDEO CASES

Stonyfield Farm ’s “Y ogurt on a M ission” (C H l)

At N ew Belgium Brewing, G reater Efficiency Is

Blowing in the W ind (CH 2)

ID G Profits Globally from Local Differences (C H 3)

Travelocity T akes e-Business a Long W ay (Ch 4 )

Bay Partners Sticks to V enture-Capital Basics (CH5)

N o Funny Business at N ewbury Comics (Ch 6 )

YIPdesk Is at Y our Service (C h 7 )

O rganizing for Success at Green M ountain

Coffee Roasters (c h 8)

C utting-Edge Production at Remington (CH 9)

People Make the Difference at the N ew England

Aquarium (C H lO )

American Flatbread Fires U p Employees ( C H ll)

Is W al-M art W aging W ar on Its W orkers? (c h 1 2 )

N ew Balance Races for Custom er

Relationships (C H 1 3 )

Flying H igh with Low Prices at JetBlue (C H 1 4 )

REI: T h e G reat Indoors (c h 1 5 )

BM W : Prom oting the U ltim ate Driving

M achine (c h 1 6 )

Lextant’s Research H elps M anagers M ake

Decisions (c h 1 7 )

T h e Ethics o f “M aking the N um bers” (C H 1 8 )

Financial Fusion Banks on the Internet (C H 1 9 )

G ilford Securities’ Financial M atchmaking: Easier

T h an D ating (c h 2 0 )

Is a Bull or Bear M arket Ahead for Build-a-Bear

W orkshop? (C H 2 1 )

END-OF-CHAPTER CASES

W ipro Vies to Bring Business to Bangalore (C H l)

W al-M art Goes G reen (CH 2)

Coca-Cola Pours into New C ountries (CH 3)

Countrywide Plans for “Clicks and Bricks” (C H 4)

Stockholders Make T h eir Voices H eard at

Disney (C h 5 )

T een Tycoons (Ch 6)

N ew Leadership, New O pportunities for

H ew lett Packard (CH 7)

Saturn: Still a D ifferent Kind of Company? (C H 8)

Bank o f America Banks on Superstringent

Quality (CH 9)

Can the U.S. Army Recruit 6,600 a M onth to

“G o Army”? (CHlO)

Borders G roup Asks Employees W hat T hey Value—

and Delivers (CHll)

Can Striking W orkers Be Replaced? (C H 1 2 )

IKEA T argets D o-It Yourselfers (C h 1 3 )

XM; 4U 24/7/365 (c h 1 4 )

G rainger G ets It D one (C H 1 5 )

H arry Potter and the W izards o f Public

Relations (C H l6 )

T h e Blog’s the T hing at IBM (C H 1 7 )

Software Stands G uard over Accounting at Kimberly￾Clark (C H 1 8 )

C itigroup Banks on C redit and M ore (C H 1 9 )

T h e M ountain T hym e Inn Buys the Farm (C H 2 0 )

A utom akers’ Bonds G o to the Junkyard (C h 2 1 )

R U N N IN G A B U SIN ESS

C O N TIN U IN G VID EO CASE

T h e Rise of Finagle A Bagel (p t I)

Finagle A Bagel: A Fast-G row ing Small

Business (P T lI)

Finagle A Bagel’s M anagem ent, O rganization,

and Production Finesse ( p t III)

Inside the People Business at Finagle

A Bagel ( p t IV )

Finagle A Bagel’s Approach to M arketing ( p t V )

Inform ation Systems and A ccounting at Finagle

A Bagel ( p t V I)

M anaging M oney at Finagle A Bagel (p t V II)

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BUSINESS

N I N TH E D I T I O N

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BUSINESS

NINTH EDITION

WILLIAM M. PRIDE

Texas A& M University

ROBERT J. HUGHES

Dallas County Community Colleges

JACK R. KAPOOR

College of DuPage Asian Network

T O * »for Higher Education

No0 0 2 9

H O U G H T O N M IF F L IN C O M P A N Y

Boston N ai' York

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T o N ancy, Allen, and M ichael Pride

T o m y m o th e r, B arbara Y. H u g h es; and m y w ife, P eggy, and in m em o ry o f P at

T h o m as

T o m y father, R am K apoor, and in m em ory o f m y m o th er, Sheela; m y wife, T h eresa;

and m y children, K aren, K athryn, and Dave

Vice President, Executive Publisher: G eorge H offm an

Sponsoring Editor: K atie Rose

Senior M arketing M anager: M ike Schenk

M arketing C oordinator: Erin Lane

Senior D evelopm ent Editor: Joanne Dauksewicz

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In stru cto r’s exam copy

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Copyright © Houghton Mifflin Company.

ßrief Contents

Pori 1 The environment of Business 1

E x p lo rin g th e W o rld o f B usiness an d E co n o m ics

2 B ein g E th ical an d Socially R esponsible

3 E x p lo rin g G lo b al B usiness

2

39

75

Pori 2 Trends in Business Today 113

4 N a v ig atin g th e W o rld o f e-B usiness

5 C h o o sin g a F o rm o f B usiness O w n ersh ip

6 Sm all B usiness, E n tre p re n e u rsh ip , an d F ran ch ises

114

147

181

Pori 3 Management and Organization 217

7 U n d e rsta n d in g th e M a n a g e m e n t P ro cess

8 C re a tin g a Flexible O rg a n iza tio n

9 P ro d u c in g Q u a lity G o o d s an d Services

218

245

275

Pori 4 Human Resources 311

1 0 A ttrac tin g and R e ta in in g th e B est E m p lo y ees

1 1 M o tiv atin g and Satisfying E m p lo y ees a n d T e a m s

1 2 E n h a n c in g U n io n -M a n a g e m e n t R elatio n s

312

347

379

Pori 5 Marketing 411

1 3 B u ild in g C u sto m e r R elatio n sh ip s T h ro u g h E ffective M a rk e tin g

1 4 C re a tin g and P ric in g P ro d u c ts th a t Satisfy C u sto m ers

1 5 W h o le sa lin g , R etailin g , and P hysical D istrib u tio n

1 6 D ev elo p in g In te g ra te d M a rk e tin g C o m m u n ic atio n s

412

441

479

513

Pori 6 Information for Business Strategy and Decision Making 549

1 7 A cq u irin g , O rg a n izin g , an d U s in g In fo rm a tio n

1 8 U s in g A c co u n tin g In fo rm atio n

550

587

Pori 7 Finance and Investment 625

1 9 U n d e rsta n d in g M o n ey , B anking, an d C re d it

20 M a ste rin g F in an cial M a n a g e m e n t

21 U n d e rsta n d in g P e rso n a l F in an ces an d In v e stm e n ts

626

663

695

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Contents

P reface xix

A cknow ledgem ents xxix

Port 1 The €nvironment of (Business______________________ 1

1 exploring the World of Business and Economics 2

Inside Business Frita-Lay Competes in a Healthy Way 3

Vour Future in the Changing World of Business 4

W hy Study Business? 5

Special Note to Students 8

Business: f) Definition 9

The Organized Effort of individuals 9

Satisfying Needs 10

Business Profit 10

Types of economic Systems 11

Capitalism 13

Capitalism in the United States 14

Command Economies 15

Measuring economic Performance 16

The Importance of Productivity in the Global

Marketplace 17

Important Economic Indicators that Measure a N ation’s

Economy 18

The Business Cycle 19

Types of Competition 20

Perfect Competition 20

Monopolistic Competition 22

Oligopoly 22

Monopoly 2 3

American Business Today 23

Early Business Development 23

The Twentieth Century 25

A New Century: 2000 and Beyond 26

T he Current Business Environment 26

The Challenges Ahead 28

YOUR CAREER Making the Most ofa Mentor Relationship 1

BIZTECH Different Paths to e-Profits 12

BUSINESS AROUND THE WORLD Flying the Frightening

Skies 21

Return to Inside Business 29

Chapter Revieuj 29

VIDEO ense 1.1 Stonyjield Fa?7n's '‘Yogurt on a Mission” 32

CRS€ 1.2 Wipro Vies to Bring Business to Bangalore 33

Journal exercise 34

BUILDING SKILLS FOR CRR€€R SUCC€SS 34

Prep Test 36

2 Being Ethical and Socially Responsible 39

Inside Business Home Depot Builds a Better

Comm unity 40

Business ethics Defined 41

ethical Issues 41

Fairness and Honesty 42

Organizational Relationships 42

Conflict of Interest 43

Communications 43

Factors Affecting ethical Behavior 43

encouraging ethical Behavior 45

Social Responsibility 48

The evolution of Social Responsibility in Business 51

Two Views of Social Responsibility 53

The Economic Model 53

T he Socioeconomic Model 53

T he Pros and Cons of Social Responsibility 54

Consumerism 55

The Six Basic Rights of Consumers 55

M ajor Consumerism Forces 56

employment Practices 57

Affirmative Action Programs 59

Training Programs for the Hard-Core Unemployed 59

Concern for the environment 60

Effects of Environmental Legislation 60

W ho Should Pay for a Clean Environment? 64

Implementing a Program of Social Responsibility 64

Developing a Program of Social Responsibility 65

Funding the Program 65

EXAMINING ETHICS Can Businesses Keep Your Personal

Information Safe? 42

ENTREPRENEURIAL CHALLENGE It’s 6 a.m.. Do You

Knoiv Uljere Your Coffee Came From? 62

vii

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Contents

B1ZTECH Reduce, Reuse, Recycle Your e-Waste 64

Return to Inside Business 66

Chopter Revieuu 66

VIDEO CRS€ 2.1 A t New Belgium Brewing, Greater

Efficiency Is Blowing in the Wind 68

CRSE 2.2 Wal-Mart Goes Green 69

Journal €xercise 70

BUILDING SKILLS FOR CAREER SUCCESS

Prep Test 73

3 Exploring Global Business 75

Inside Business H einz: Fifty-Seven Varieties in O ver

F ifty Countries 76

The Basis for International Business 77

Absolute and Comparative Advantage 77

Exporting and Im porting 78

Restrictions to International Business 80

Types of T rade Restrictions 80

Reasons for T rade Restrictions 82

Reasons Against T rade Restrictions 83

The €xtent of International Business 83

T he W orld Economic Outlook for T rade 84

T he General Agreement on Tariffs and T rade and the

W orld T rade Organization 86

International Economic Communities 88

Methods of Entering International Business 90

Licensing 90

Exporting 91

Joint Ventures 93

Totally Owned Facilities 93

Strategic Alliances 93

T rading Companies 94

C ountertrade 94

Multinational Firms 94

Sources of Export Assistance 94

Financing International Business 98

T he Export-Im port Bank of the U nited States 98

M ultilateral Development Banks 98

T he International M onetary Fund 99

YOUR CAREER Are You Ready for a Global Job? 83

BUSINESS AROUND THE WORLD Discount Airlines Are

Flying High 95

ENTREPRENEURIAL CHALLENGE Connecting Global

Partners 98

Return to Inside Business 99

Chapter Review 100

VIDEO CASE 3.1 ID G Profits Globally from Local

Differences 101

CASE 3.2 Coca-Cola Pours into New Countries 102

Journal Exercise 103

BUILDING SKILLS FOR CAREER SUCCESS 104

Prep Test 106

RUNNING A BUSINESS PORT I The Rise o f Finagle A Bagel 108

BUILDING R BUSINESS PIRN PORT I 110

Part 2 Trends in Business Today 113

4 Navigating the World of e-Business

Inside Business N othing but N e t a t N etflix 115

Defining e-Business 116

Organizing e-Business Resources 116

Satisfying N eeds Online 117

Creating e-Business Profit 118

A Framework for Understanding e-Business 120

Telecom munications and C om puter Hardware

M anufacturers and Internet Service Providers 121

Internet Software Producers 122

Online Sellers and C ontent Providers 123

Global e-Business 123

Small e-Business 124

114

Fundamental Models of e-Business 125

Business-to-Business (B2B) M odel 125

Business-to-Consumer (B2C) M odel 126

Creating an e-Business Plan 126

Starting Up a N ew Internet Business from Scratch 127

Building an Online Presence for an Existing Business 128

Social and Legal Concerns 129

Ethics and Social Responsibility 130

Privacy and Confidentiality Issues 130

Security Concerns and Cybercrime 131

Digital Property and C opyright C oncerns 132

G overnm ent Regulation and Taxation 133

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Copyright © Houghton Mifflin c

Contents

The Future of e-Business: Growth, Opportunities, and

Challenges 133

Internet Growth Potential 134

Environmental Forces Affecting e-Business 135

BUSINESS AROUND THE WORLD e-Businesses Go

Globetrotting 124

YOUR CAREER The New Role of Chief Privacy Officer 12 9

EXAMINING ETHICS Coping zi ith Computer Viruses 131

Return to Inside Business 137

Chapter Review 138

VID€0 CRS6 4.1 Travelocity Takes e-Business a Long

Way 140

CRS€ 4.2 Countrywide Plans for “Clicks and Bricks” 141

Journal Cxercise 142

BUILDING SKILLS FOR CRR€€R SUCC6SS 142

Prep Test 144

5 Choosing o Form of Business Ownership

Inside Business General Electric Grows into Its Second

Century 148

Sole Proprietorships 149

Advantages of Sole Proprietorships 149

Disadvantages of Sole Proprietorships 151

Beyond the Sole Proprietorship 152

Partnerships 152

Types of Partners 153

The Partnership Agreement 154

Advantages of Partnerships 154

Disadvantages o f Partnerships 156

Beyond the Partnership 157

Corporations 157

Corporate Ownership 158

Forming a Corporation 158

Corporate Structure 160

Advantages of Corporations 161

Disadvantages of Corporations 162

Special Types of Business Ownership 163

S-Corporations 163

Limited-Liability Companies 164

Government-Owned Corporations 164

N ot-for-Profit Corporations 164

147

Cooperatives, Joint Ventures, and Syndicates 165

Cooperatives 165

Jointventures 166

Syndicates 166

Corporate Growth 166

Growth from w ith in 166

Growth Through Mergers and Acquisitions 167

Current M erger Trends 169

ENTREPRENEURIAL CHALLENGE Incubators Give

Entrepreneurs a Head Start 156

YOUR CAREER Corporations Depend on Investor

Relations 162

BUSINESS AROUND THE WORLD International Mergers

and Acquisitions Face Protectionism 169

Return to Inside Business 170

Chapter Review 170

VID€0 CflS€ 5.1 Bay Partners Sticks to Venture-Capital

Basics 173

c fl S € 5 ắ 2 Stockholde?y Make Their Voices Heard at Dimey 174

Journal €xercise 175

BUILDING SKILLS FOR CRR€€R success 175

Prep Test 177

6 Small Business, Entrepreneurship, and Franchises 181

Inside Business Carol’s D aughter Grows Up with

Beauty 182

Small Business: R Profile 183

T he Small-Business Sector 183

Industries that Attract Small Businesses 184

T he People in Small Businesses: T he Entrepreneurs

185

W hy Small Businesses Fail 188

The Importance of Small Businesses in Our

Economy 188

Providing Technical Innovation 189

Providing Employm ent 190

Providing Com petition 190

Filling Xeeds o f Society and O ther Businesses 190

The Pros and Cons of Smallness 191

Advantages of Small Business 191

Disadvantages of Small Business 192

Developing a Business Plan 194

Com ponents of a Business Plan 194

The Small Business Administration 194

SBA M anagement Assistance 195

SBA Financial Assistance 198

Franchising 199

WTiat Is Franchising? 199

Types of Franchising 200

T he Growth of Franchising 200

Are Franchises Successful? 202

Advantages of Franchising 202

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Contents

Disadvantages of Franchising 203

Global Perspectives in Small Business 204

BIZTECH Goodbye Cell Phone, Hello Wi-Fi Phone? 187

ENTREPRENEURIAL CHALLENGE When Should

Entrepreneurs Use Outsourcing? 191

BUSINESS AROUND THE WORLD Do's and Don’ts of

International Franchising 204

Return to Inside Business 205

Chapter Revieuu 205

VIDEO CRS€ 6.1 No Funny Business at Newbury Comics 207

CASE 6.2 Teen Tycoons 208

Journal Exercise 209

BUILDING SKILLS FOR CAREER SUCCESS 209

Prep Test 211

RUNNING R BUSINESS PART II Finagle A Bagel: A Fast-Growing Small Business 214

BUILDING A BUSINESS PLAN PART II 215

Pari 3 Management and Organization 217

Understanding the Management Process 218

Inside Business Do Founders M ake Good CEOs? 219

What Is Management? 220

Basic Management Functions 221

Planning 221

Organizing the Enterprise 224

Leading and Motivating 224

Controlling Ongoing Activities 225

Kinds of Managers 226

Levels of Management 226

Areas of Management Specialization 227

What Makes effective Managers? 228

Key M anagement Skills 228

Managerial Roles 230

Leadership 231

Formal and Informal Leadership 231

Styles of Leadership 2 31

W hich Managerial Leadership Style Is Best? 231

Managerial Decision Making 232

Identifying the Problem or Opportunity 232

Generating Alternatives 232

Selecting an Alternative 233

Implementing and Evaluating die Solution 233

Managing Total Quality 234

What It Takes to Become a Successful Manager

Today 234

A Day in the Life of a Manager 234

Skills Required for Success 235

The Importance of Education and Experience 235

EXAMINING ETHICS What Makes an Ethical

Leader? 225

BUSINESS AROUND THE WORLD PepsiCo Faces a

Credibility Crisis in India 229

YOUR CAREER The Heat Is On— and You’re the

Decision Maker 233

Return to Inside Business 236

Chapter Revieiu 236

VID€0 CnS€ 7.1 VIPdesk Is at Your Service 238

CRS€ 7.2 New Leadership, New Opportunities for Hewlett

Packard 239

Journal Exercise 240

BUILDING SKILLS FOR CAREER SUCCESS 240

Prep Test 243

8 Creating a Flexible Organization 245

Inside Business Global H yatt Gets Organized 246

UJhat Is an Organization? 247

Developing Organization Charts 247

Five Steps for Organizing a Business 247

Job Design 248

Job Specialization 249

T he Rationale for Specialization 249

Alternatives to Job Specialization 250

Departmentalization 250

By Function 250

ByProduct 250

By Location 251

By Custom er 251

Combinations of Bases 251

Delegation, Decentralization, and Centralization 252

Delegation of Authority 252

Decentralization of Authority 252

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Contents

The Span of Management 253

Wide and Narrow Spans of Control 254

Organizational Height 254

Chain of Command: line and Staff Management 255

Line and Staff Positions Compared 256

Line-Staff Conflict 256

Forms of Organizational Structure 257

The Bureaucratic Structure 257

The Matrix Structure 258

The Cluster Structure 259

T he Network Structure 260

Additional Factors That Influence an Organization 260

Corporate Culture 260

Intrapreneurship 262

Committees 263

Coordination Techniques 263

T he Informal Organization 263

ENTREPRENEURIAL CHALLENGE Five Ways to Improve

Delegation 253

BUSINESS AROUND THE WORLD Multinationals Grapple

with Global Authority 254

BIZTECH High-Tech Firms Practice Cubicle Culture 262

Return to Inside Business 265

Chapter Review 265

VID€0 CRS€ 8.1 Organizing for Success at Green Mountain

Coffee Roasters 267

CRS€ 8.2 Saturn: Still a Different Kind of Company? 268

Journal Exercise 269

BUILDING SKILLS FOR CRR€€R SUCC€SS 269

Prep Test 272

9 Producing Quality Goods and Services

Inside Business H igher Quality and Teamwork Drive

H igher Sales a t H yundai 276

UJhat Is Production? 277

Competition in the Global Marketplace 277

Careers in Operations .Management 278

The Conversion Process 279

Manufacturing Using a Conversion Process 279

T he Increasing Importance of Services 280

Where Do New Products and Services Come From? 281

Research and Development 281

Product Extension and Refinement 282

Planning for Production 283

Design Planning 283

Facilities Planning and Site Selection 285

Operational Planning 288

Operations Control 289

Purchasing 289

Inventor)' Control 290

Scheduling 291

Quality Control 293

275

Management of Productivity and Technology 295

Productivity Trends 295

Improving Productivity Growth Rates 296

T he Impact of Computers and Robotics on

Production 296

YOUR CAREER Five Tips for Customer Service Success 281

ENTREPRENEURIAL CHALLENGE A Small Business

Makes a Big Breakthrough 283

BUSINESS AROUND THE WORLD Steering Toward

Higher Productivity 296

Return to Inside Business 299

Chapter Review 299

VIDCO CRS6 9.1 Cutting-Edge Production at

Remington 301

CRS€ 9.2 Bank of America Banks on Superstringent

Quality 302

Journal €xercise 303

BUILDING SKILLS FOR CRR€€R SUCC6SS 304

Prep Test 306

RUNNING fl BUSINESS PRRT III Finagle A BageVs Management, Organization, and Production Fiiïesse 308

BUILDING R BUSIN6SS PLAN PART III 309

Pari 4 Human Resources

10 Attracting and Retaining the Best

Inside Business Diversity Tops the McDonald's

M enu 313

Human Resources Management: fln Overview 314

HRM Activities 314

Responsibility for HRM 314

_________________________ 311

Employees 312

Human Resources Planning 315

Forecasting Human Resources Demand 315

Forecasting Human Resources Supply 315

Matching Supply with Demand 316

Số hóa bởi Trung tâm Học liệu – ĐH TN http://www.lrc-tnu.edu.vn Cultural Diversity in Human Resources 316

Contents

Job Analysis 319

Recruiting, Selection, and Orientation 319

Recruiting 319

Selection 321

Orientation 324

Compensation and Benefits 324

Compensation Decisions 324

Comparable W orth 325

Types of Compensation 326

Employee Benefits 327

Training and Development 328

Analysis of Training Needs 329

Training and Development M ethods 329

Evaluation of Training and Development 330

Performance Appraisal 330

Common Evaluation Techniques 330

Performance Feedback 332

The Legal environment of HRM 333

National Labor Relations Act and Labor-Management

Relations Act 333

Fair Labor Standards Act 334

Equal Pay Act 334

Civil Rights Acts 334

Age Discrimination in Employment Act 334

Occupational Safety and Health Act 334

Employee Retirement Income Security Act 335

Affirmative Action 335

Americans with Disabilities Act 335

YOUR CAREER Here’s How to Negotiate for Higher

Compensation 324

EXAMINING ETHICS CEO Compensation.Ể How Much Is

Too MuchĨ 326

BIZT E c H Employee Training Goes Virtual 329

Return to Inside Business 336

Chapter Review 336

VID€0 CRS€ 10.1 People Make the Difference at the New

England Aquarium 338

CRS€ 10.2 Can the U.S. Arm y Recruit 6,600 a Month to

“Go A rm y” Ì 339

Journal €xercise 340

BUILDING SKILLS FOR CRR€€R su c c e s s 341

Prep Test 343

11 Motivating and Satisfying Employees and Teams 347

Inside Business I Love M y Job: Keeping Employees

Happy and Productive 348

UJhcit Is Motivation? 349

Historical Perspectives on Motivation 349

Scientific M anagem ent 349

T he H awthorne Studies 350

Maslow’s Hierarchy of Needs 351

H erzberg’s M otivation-Hygiene Theory 353

Theory X and Theory Y 3 54

Theory Z 355

Reinforcement T heory 356

Contemporary Views on Motivation 357

Equity T heory 357

Expectancy Theory 358

Goal-Setting T heory 359

Key Motivation Techniques 359

M anagem ent by Objectives 359

Job Enrichm ent 360

Behavior Modification 361

Flextime 362

Part-Tim e W ork and Job Sharing 363

Telecom m uting 363

Employee Empow erm ent 364

Employee Ownership 365

Teams and Teamwork 365

W hat Is a Team? 365

Types o f Team s 365

Developing and Using Effective Team s 367

Roles W ithin a Team 368

Team Cohesiveness 368

Team Conflict and How to Resolve It 369

Benefits and Limitations ofT eam s 369

EXAMINING ETHICS Keeping Employees Safe 352

YOUR CAREER Make Your Job Application Stand Out 360

BIZTECH Telecommuting: By the Numbers 364

Return to Inside Business 370

Chapter Review 370

VID€O CRS€ 11.1 American FlatbreadFires Up

Employees 372

CRS€ 11.2 Borders Group Asks Employees What They

Value— and Delivers 373

Journal €xercise 374

BUILDING SKILLS FOR CRR€€R SUCC6SS 375

Prep Test 377

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.Copyright Ü I loughton Mifllin Company.

Contents

12 Enhancing Union-Management Relations 379

Inside Business Labor Disputes Spark M ajor League

Strife 380

The Historical Development of Unions 381

Early History 381

Evolution of Contemporary Labor Organizations 383

Organized Labor Today 383

Union Membership 384

Membership Trends 384

Union-Management Partnerships 385

labor-Management Legislation 386

Norris-LaGuardia Act 386

National Labor Relations Act 386

Fair Labor Standards Act 387

Labor-Management Relations Act 387

Landrum-Griffin Act 388

The Unionization Process 388

W hy Some Employees Join Unions 389

Steps in Forming a Union 389

T he Role of the NLRB 390

Collective Bargaining 391

The First Contract 391

Later Contracts 392

Union-Management Contract Issues 392

Employee Pay 392

W orking Hours 394

Security 394

Management Rights 395

Griev ance Procedures 395

Union and Management Negotiating Tools 397

Strikes 397

Slowdowns and Boycotts 397

Lockouts and Strikebreakers 398

Mediation and Arbitration 398

BUSINESS AROUND THE WORLD China's Labor

Movement: Is It Helping Workers? 388

BIZTECH Who's Blogging-—and Why? 396

YOUR CAREER Would You Make a Good Mediator or

Arbitrator? 398

Return to Inside Business 399

Chapter Revieuj 400

VID€0 CRS€ 12.1 Is Wal-Mart Waging War on Its

Workers? 402

CRS€ 12.2 Can Striking Workers Be Replaced? 403

Journal €xercise 404

BUILDING SKILLS FOR CRR€€R SUCC€SS 404

Prep Test 406

RUNNING fl BUSIN€SS PRRT IV Inside the People Business at Finagle A Bagel 408

BUILDING R BUSIN€SS PLRN PRRT IV 409

Pori 5 Marketing

13 Building Customer Relationships Through Effective Marketing

Inside Business W b a t’s “Cool”? W ho Says So? 413

Managing Customer Relationships 414

Utility: The Value Added by Marketing 415

The Marketing Concept 416

Evolution o f the Marketing Concept 416

Implementing the farketing Concept 417

Markets and Their Classification 418

Developing Marketing Strategies 419

Target M arket Selection and Evaluation 419

Creating a M arketing Mix 422

Marketing Strategy and the Marketing Environment 423

Developing a Marketing Plan 424

Market Measurement and Sales Forecasting 424

Marketing Information 425

Marketing Information Systems 426

Marketing Research 426

Using Technology to G ather and Analyze Marketing

Information 426

411

412

Types of Buying Behavior 428

Consumer Buying Behavior 429

Business Buying Behavior 430

ENTREPRENEURIAL CHALLENGE Building a Business

on eBay 417

YOUR CAREER Marketing Me 424

EXAMINING ETHICS A Matter of Trust: Dell Rebuilds

Customer Relationships 431

Return to Inside Business 431

Chapter Review 432

VID€0 CRS€ 13.1 New Balance Races for Customer

Relationships 434

CRS6 13.2 IKFA Targets Do-It Yourselfers 435

Journal Exercise 436

BUILDING SKILLS FOR CRR€€R SUCCESS 437

Prep Test 439

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Contents

14 Creating and Pricing Products that Satisfy Customers 441

Inside Business The Apple o f M y iPod 442

Classification of Products 443

Consumer Product Classifications 443

Business Product Classifications 444

The Product life Cycle 444

Stages of the Product Life Cycle 445

Using the Product Life Cycle 446

Product Line and Product Mix 447

Managing the Product Mix 447

Managing Existing Products 448

Deleting Products 448

Developing New Products 449

Branding, Packaging, and Labeling 451

W hat Is a Brand? 452

Types of Brands 452

Benefits of Branding 452

Choosing and Protecting a Brand 454

Branding Strategies 454

Packaging 455

Labeling 457

Pricing Products 458

T he Meaning and Use of Price 458

Supply and Demand Affects Prices 458

Price and Nonprice Competition 459

Buyers’ Perceptions of Price 460

Pricing Objectives 460

Survival 461

Profit Maximization 461

Target Return on Investment 461

Market-Share Goals 461

Status-Quo Pricing 461

Pricing Methods 462

Cost-Based Pricing 462

Demand-Based Pricing 463

Competition-Based Pricing 464

Pricing Strategies 464

New Product Strategies 464

Differential Pricing 465

Psychological Pricing Strategies 466

Product-Line Pricing 467

Promotional Pricing 468

Pricing Business Products 468

Geographic Pricing 468

Transfer Pricing 468

Discounting 469

EXAMINING ETHICS Cookie Monster 449

BUSINESS AROUND THE WORLD Accept No Imitations:

Fighting Fakes 455

BIZTECH Talk Is Cheap: Online Telephone

Services 461

Return to Inside Business 469

Chapter Review 470

VID€0 CRS€ 14.1 Flying High with Low Prices at

JetBlue 473

CRS€ 14.2 XM : 4 U 24/7/365 474

Journal Exercise 475

BUILDING SKILLS FOR CRR€€R SUCC€SS 475

Prep Test 477

15 Wholesaling, Retailing, and Physical Distribution 479

Inside Business Dell: Direct and Not-So-Direct 480

Channels of Distribution 481

Channels for Consumer Products 481

Channels for Business Products 483

Market Coverage 483

Partnering Through Supply-Chain Management 484

Vertical Marketing Systems 485

Marketing Intermediaries: Wholesalers 485

Justifications for Marketing Intermediaries 486

W holesalers’ Services to Retailers 487

Wholesalers’ Services to Manufacturers 487

Types of Wholesalers 488

Marketing Intermediaries: Retailers 489

Classes of In-Store Retailers 489

Kinds of Nonstore Retailing 493

Planned Shopping Centers 495

Lifestyle Shopping Centers 496

Neighborhood Shopping Centers 496

Community Shopping Centers 496

Regional Shopping Centers 497

Physicol Distribution 497

Inventory Management 497

Order Processing 498

W arehousing 498

Materials Handling 499

Transportation 499

ENTREPRENEURIAL CHALLENGE Entrepreneurs Break

into the Big Time 483

BUSINESS AROUND THE WORLD This Globa! Bazaar Is

Right on Target 491

EXAMINING ETHICS Too Much Information 498

Return to Inside Business 502

Chapter Review 503

VIDEO CRS€ 15.1 REI: The Great Indoors 505

C R S € 15.2 Grainger Gets It Done 506

Journal Exercise 507

BUILDING SKILLS FOR CRR€€R SUCCESS 507

Prep Test 510

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