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Copyright © 2016, 2013, 2011 Pearson Education, Inc. 3
After studying these topics, you will benefit by:
• Knowing how organizational structures and
functions influence quality and customer
satisfaction
• Naming the key elements and purpose of a
company strategy
• Illustrating and interpreting an organizational
chart
• Defining quality and its importance in business
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 4
After studying these topics, you will benefit by:
• Researching methods of increasing one’s
creativity and innovation
• Explaining how customer service affects
performance and profits
• Describing how best to handle a difficult
customer
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 5
PRODUCTIVITY IN A
QUALITY-FOCUSED WORKPLACE
• Productivity: to perform a function that adds
value to the company
• Whatever you produce (output) should add
value to the company
• Productivity at work starts with:
– Ethics
– Attitude
– Goals
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 6
PRODUCTIVITY IN THE WORKPLACE
• Mission Statement: a statement of purpose (what and why)
• Vision Statement: a company’s viable view of the future (where)
• Values Statement: standard of behavior (how)
• Directional Statements: foundation for why a company exists and how it will operate (mission, vision, and value)
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 7
PRODUCTIVITY IN THE WORKPLACE
Company Strategy
• Strategy: outlines major goals and objectives and serves as a company road map
• Strategic plan: a formal document that identifies how the company will secure, organize, use, and monitor its resources
• Company resources
– Human (employees)
– Fiscal (financial)
– Capital (long-term investments)
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 8
PRODUCTIVITY IN THE WORKPLACE
Company Strategy
• Goal: a target. Describes what needs to be
achieved
• Objectives: short-term goals (specific
activities) that support a goal; objectives
have timelines and are measurable
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 9
TOPIC SITUATION
Juan Joins a Committee
What additional advantages will Juan gain if
he joins the committee? How can Juan
prepare for this experience?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 10
LINES OF AUTHORITY
• Organizational structure: the way a company is organized
• Organization chart: a graphic display of the formal lines of authority.
– Identifies key functions within the company
President
Marketing
Vice President
Operations
Vice President
Finance
Vice President
Mgmt. Info. Systems
Vice President
Sales Advertising Production DistributionAccounting
DirectorComputer
Accounts
Receivable
Supervisor
Accounts
Payable
Supervisor
Figure 7-1
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 11
TOPIC SITUATION
Lucia Meets the CEO
Why should you know a company’s
organizational structure and identities of key
executives?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 12
Investors/
Owners
Board of
Directors
President/C.E.O.
Senior Management
(Vice Presidents)
Middle Management
(Directors, Managers)
Operation Managers
(Supervisors, Assistant Managers)
Employees
Company Structure: Key Titles
LINES OF AUTHORITY
The Leader-reports to Board
Responsible for
overall strategy
and policies
Assists President/CEO in identifying and
implement company strategy
Work on tactical issues (link strategy
into day-to-day operations
Work on operational issues
(daily issues)
Figure 7-2
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 13
LINES OF AUTHORITY
Major Organizational Functions
• Divisions: major functions within a business
• Departments: carry out specific functions within divisions
• Key business functions
– Finance and accounting
– Human resource management
– Operations
– Information systems
– Marketing
– Legal counsel
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 14
LINES OF AUTHORITY
• Finance and Accounting: area responsible
for securing the distribution and growth of a
company’s financial assets
– Capital budget: long-term investments
– Operational budget: short-term items
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 15
• Human Resources: area responsible for
recruiting, hiring, training, evaluating,
compensating, promoting, and terminating
employees
– Deals with the employee (people) side of
business
LINES OF AUTHORITY
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 16
• Operations: area that deals with the production
and distribution of the company’s product
• Information Systems (IS): deals with electronic
management of information within an
organization
• Routinely back-up files
• Empty electronic trash bin
• Conduct routine virus checks
• Responsible for reported computer viruses and
system problems
LINES OF AUTHORITY
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 17
• Marketing: area responsible for creating,
pricing, selling, distributing, and promoting the
company’s product
– Every employee is a walking billboard for the
company
• Legal Counsel: handles all legal matters
relating to the business
– Check with company legal counsel prior to
engaging in a contract on behalf of the company
LINES OF AUTHORITY
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 18
TOPIC SITUATION
Max Orders Supplies
What should Max do? Justify your response.
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 19
QUALITY AND THE COMPANY
• A building, its employees, and the product
produced are major elements that define a
company, but a company needs customers to
succeed
• Each job in the company has a purpose
• Do your best at all times
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 20
THINK ABOUT IT
Why do some employees not care about quality?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 21
QUALITY AND THE COMPANY
Important Company Elements
Quality
Customer loyalty
Employee loyalty
Profit
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 22
QUALITY AND THE COMPANY
• Quality: a predetermined standard that defines how a product is to be provided
– Customers demand quality in the product and from the company’s employees
– If customers don’t perceive that they have received a quality product, they will not make a repeat purchase
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 23
QUALITY AND THE COMPANY
Customer Loyalty
• Customers will repeat purchases when they receive value and a quality product
• Companies want to build brand loyalty with customers
• Customers will be loyal to a company and its products when quality products and customer service are consistently provided
• Value: customers believe they received a good deal for the price they paid
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 24
QUALITY AND THE COMPANY
Employee Loyalty
• Employee loyalty: an employee’s obligation to consistently support a company and its mission
– Do your job and do it well
– Show respect for company policies, your coworkers, and the company’s customers
– Promote the company and its products
– Do not speak poorly of your company, coworkers, or the company’s product
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 25
QUALITY AND THE COMPANY
Profits
• The success of a company depends on
profit
• Profit: revenue minus expenses
– Revenue: money coming in from sales
– Expenses: costs involved in running the
business
• As profits increase, the company can
grow
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 26
QUALITY AND THE COMPANY
Product vs. Good vs. Service
• Product: what is produced by a company;
this can be a good, a service, or both
• Good: a tangible item, something that you
can physically see or touch
• Service: an intangible product, in other
words, you cannot touch or see the product
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 27
WHO IS THE CUSTOMER?
• To create a satisfied customer, you need a
high-quality product or service and excellent
customer service
= Quality Products
= Satisfied, Loyal Customers
= Profits
Quality Employees + Quality Inputs
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 28
QUALITY
• When it comes to quality, the expectation of
customers is high
• Customers expect that a product will last
• Value: when customers believe they are
getting a good deal for the price they paid
– Customers expect value
– Customers measure product quality by
comparing your product to similar products
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 29
CREATIVITY AND INNOVATION
• Creativity: coming up with a new and unique
good, service, or system. A creative person will
ask, “what if” instead of being constrained by
the barrier of an item’s or service’s original use
• Innovation: process of turning a creative idea
into reality
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 30
TALK IT OUT
Discuss the difference between a service and
customer service.
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 31
EXCELLENT CUSTOMER SERVICE
DEFINED
• Customer: an individual or business that
buys or uses the company’s product
• A company cannot survive without customers
• Internal customers exist within a company
– Coworkers and other departments
• External customers are individuals whom the
company serves outside
– Customers, vendors, and investors
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 32
EXCELLENT CUSTOMER SERVICE
DEFINED
• Customer Service: the treatment an
employee provides a customer
– Respect and kindness
– Competent: an employee who knows the product
his or her company offers
– Dependable: an employee who is reliable and
takes responsibility to assist a customer
– Responsive: an employee who provides a
customer personal attention
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 33
EXCELLENT CUSTOMER SERVICE
Impressions
• As soon as a customer comes in contact with a business, an opinion is formed about that business
• There is only one first impression, so it must be good
• The appearance of the building and/or employees can be the reason a customer comes to your company in the first place
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 34
TALK IT OUT
How does personal appearance influence a
customer’s trust and perception of you?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 35
THE IMPACT OF CUSTOMER SERVICE
• Get to know your customers
• Excellent customer service is the biggest
reason customers return
• Build a relationship with the customer that will
make him or her loyal to you and your
business
• A business needs satisfied customers to not
only make repeat purchases but also to tell
others about their favorable experience
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 36
TALK IT OUT
How should you handle a situation when you
observe a verbal conflict between two
employees that is taking place in front of a
customer?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 37
THE DIFFICULT CUSTOMER
“The customer is always right”
• The customer may not be right
• Although the customer may be wrong, adopt an attitude that the customer is unhappy and do all you can to help the customer solve the problem
• Have patience and sympathize with the customer
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 38
THINK ABOUT IT
How do you normally respond to conflict?
Does your response hinder or help you provide
appropriate service to a difficult customer?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 39
TOPIC SITUATION
Kiana and Customer Service
What specific actions did the pizza shop take
to display excellent customer service to
Kiana?
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 40
THE DIFFICULT CUSTOMER
Tips for Handling the Customer
• Stay calm, let the customer talk, and listen for facts—let the customer vent for a few minutes, do not interrupt or say “please calm down,” do not take harsh words personally
• Watch body language—tone of voice, eye contact, and arm movement; if you feel a customer has the potential to become violent or physically abusive, immediately seek assistance
• Acknowledge the customer’s frustration—say, “I can understand why you are upset,” and summarize the concern to let him or her know you understand
Copyright © 2016, 2013, 2011 Pearson Education, Inc. 41
THE DIFFICULT CUSTOMER
Tips for Handling the Customer (cont.)
• Make sure the problem gets solved—try to take care of the problem yourself
• Know company policy—if a customer challenges a policy, calmly and politely explain the purpose of the policy
• Expect conflict, but do not accept abuse—if a customer shows aggressiveness or is cursing, politely tell that customer you cannot help until he or she is able to treat you in a respectful manner; if he or she continues the inappropriate behavior, immediately call a supervisor