Channel Evaluation


Channel evaluation is a multidimensional construct and includes both performance measures of the channel and measures of contribution to consumers by th channel. These measures of channel performance have been grouped under three main dimensions also known as 3Es, i.e., Effectiveness, Efficiency, and Equity. Effectiveness is further subdivided into delivery and stimulation.

  • Delivery is defined as a short term measure of how well the channel meets the demand for service outputs placed on it by the consumption sector.
  • Stimulation is defined as a long term, goal oriented measure of how well the channel member stimulate latent demand to reach optimum levels of demand.

Efficiency is further subdivided into productivity and profitability:

  • Productivity is defined as the efficiency with which output is generated from resources and inputs used. In essence, productivity is a measure of physical efficiency.
  • Profitability is a general measure of financial efficiency of channel member, in terms of return on investment, liquidity, leverage, growth patterns in sales and profits, growth potential in sales and profits, market share, average inventory maintained, etc.

Equity is the extent to which marketing channels serve problem-ridden markets and market segments, such a disadvantaged or geographically isolated consumers.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures

Business Financial Strategy


Financial strategy examines the financial implications of corporate and business-level strategic options and identifies the best financial course of action. It can also provide competitive advantage through a lower cost of funds and a flexible ability to raise capital to support a business strategy. Financial strategy usually attempts to maximize the financial value of the firm.

The trade-off between advancing the desired debt-to-equity ratio and relying on internal long-term financing via cash flow is a key issue in financial strategy. Many small and medium-sized companies try to avoid all external sources of funds in order to avoid outside entanglements and to keep control of the company within the family. Many believe that only by financing through long-term debt can a corporation use financial leverage to boost earnings per share, thus raising stock price and the overall value of the company. Higher debt levels not only deter takeover by other firms (by making the company less attractive), but also leads to improved productivity and improved cash flows by forcing management to focus on core businesses.

A very popular financial strategy is the leveraged buy out—a company is acquired in a transaction financed largely by debt—usually obtained from a third party, such as an insurance company or an investment banker. Ultimately the debt is paid with money generated from the acquired company’s operations or by sales of its assets. The acquired company, in effect, pays for its own acquisition. Management of the leveraged buy out is then under tremendous pressure to keep the highly leveraged company profitable. Unfortunately the huge amount of debt on the acquired company’s books may actually cause its eventual decline by focusing management’s attention on short-term matters.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Financial Statement


A financial statement is a snapshot taken of your business at a given time. Usually this picture is taken at a month end. It will tell you what the business owns, what it owes, your capital and equity in the business, what the sales were, what it cost to make those sales, what the business overhead was, and how much profit (or loss) the business made.

A financial statement follows a set format, consisting following sections:

  • Notice to reader or review engagement report
  • Balance sheet
  • Statement of retained earnings (if incorporated)
  • Statement of income and expenses
  • Notes to financial statements
  • Statement of changes in financial position.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Equity Theory of Motivation


First articulated by J. Stacey Adams, equity theory is based on the simple premise that people want to be treated fairly. The theory defines equity as the belief that we are being treated fairly in relation to others and inequity as the belief that we are being treated unfairly in relation to others.

Equity theory is just one of several theoretical formulations derived from social comparison processes. Social comparisons involve evaluating our own situation in the context of others’ situations.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Determining Salary Range


Responsibilities and salary are always related. Once you have drawn up a list of job duties and responsibilities and have written a job description, determining a corresponding salary range should be easy.

Roughly speaking, all jobs can be sorted into three categories:

  1. Nonexempt jobs are those that involve performing prescribed, internal tasks and include little problem solving.
  2. Exempt jobs are those associated with supervising the performance of internal tasks and dealing with problems related to those tasks. These employees do not need to be overpaid overtime for extra hours. A good rule of thumb for determining whether a job is exempt is this: if you miss a day of work and someone else does your work for you during your absence, your job is probably nonexempt. But if you return to work and find your work waiting for you, you’re probably exempt.
  3. Management positions are those involving responsibility for addressing internal and external problems and programs, such as business objectives and challenges.

Avoid the temptation to inflate a job’s title by pasting the management label on a task-based job. People with management skills cost more money in the job market and are harder to hire. Let’s say you decide to speed up your company’s inefficient employee healthcare claims handling process by creating a new position: someone who will collect claim forms and coordinate with your insurance carrier. Don’t lose sight of the fact that you are hiring someone to perform a series of tasks, not to address a management problem. Advertise for a clerk or coordinator, not a manager.

Always establish the correct responsibility level and salary range for every opening you advertise. Doing so will provide consistency throughout your department and maintain internal equity in the structuring and compensation of jobs.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

The Changing World of Business


The poor performance of star companies in the 1980s and 90s, both MNCs and domestic, has amply demonstrated their susceptibility to under-perform in the face of rapid and marked changes in technology, competition and customer expectations. It is not that all these companies lacked resources, capabilities or competent managers to anticipate and assess the impending changes and initiate proactive action; what they lacked was concern on the part of their managers to enhance the shareholder value of their respective firms on a sustained basis. As a result, this value got diverted to the customers, employees, competitors and suppliers of the company. While it is well known that a firm needs to develop distinctive capabilities and also build a strong network with its key stakeholders to enhance its value creating potential and appropriation of value this created, what really happened in case of most of these unsuccessful firms was that one or more of the stakeholders gained at the expense of the shareholders. The proponsity of managers to take operating, investment and financial decisions without any concern as to how such decisions can affect their shareholders led them to pursue strategies and investments that were ill-conceived and poorly executed, thereby systematically destroying the capabilities and equity developed over the years.

We should argue how the outcome of such a tendency can be detrimental to not only the firms but also to the job and career of the managers, particularly in the light of the various new developments—such as economic liberalization and opening up of most economies to domestic and global competition, greater freedom to access and move capital, emergence of the market for corporate control, and rising shareholder, activism—which have brought the issue of enhancing shareholders’ wealth to the forefront.

It is clear that managers will need to take a fresh guard and revisit their strategies, business processes and organization in order to face this complex set of challenges and retain their firm’s ability to enhance wealth of their shareholders. Thanks to the contribution made by the academia and practising executives, managers now have access to various concepts based on experiences when it comes to facing such challenges. However, it must be stressed that the need of the hour is not another set of concepts and framework; rather what is required is a new “philosophy of business” that draws the attention of every employee of an organization, starting with the CEO, to the importance of creating, enhancing and sustaining shareholder value in everything that the company does—be it strategic, tactical or even routine matters. Needless to say, the employees will also need guidelines on how to operationalize this new philosophy and what actions are needed to sustain the same.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight

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