Price Differentiation


A common response during slow demand is to discount the price of the service. This strategy relies on basic economics of supply and demand. To be effective, however, a price differentiation strategy depends on solid understanding of customer price sensitivity and demand curves.

Heave use of price differentiation to smooth demand can be a risky strategy. Over –reliance on price can result in price wars in any industry where eventually all competitors suffer. Price wars are well known in the airline industry, where total industry profits suffered as a result of airlines simultaneously trying to attract customers through price discounting.

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.

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Toyota’s Supply Chain


The first-tier firms play a key role in Toyota’s Supply Chain. There are six areas in which these firms act  as the pivotal part of the system.

  1. Quality Buffer
  2. Gaining
  3. System Developer
  4. Purchaser
  5. Designer
  6. Problem Solvers

Within the Toyota supplier network there is only a small reliance on the micro firms. However, the key to Toyota’s success cannot lie within such very small firms at the 3rd and 4th tiers as they are only responsible for 3 percent of the value=adding processes, although due to their high productivity  this yields a 10 percent total productivity advantage  to the total Toyota supplier network.

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.

Misrepresentation


The basic idea of misrepresentation is that one of the parties to a contract created in the mind of the other party a mistaken impression about an important fact about the subject of the contract. Acting in reliance upon this mistaken belief, the victimized party entered into a contract he or she would not otherwise have entered if the full truth had been known. The elements of misrepresentation are ordinarily given as misrepresentation of material fact justifiably relied upon to the detriment of (causing harm to) the person  relying.

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.

Training the Trainer


If learning is to be truly continuous, an organization must look to its own resources for more and more of the teaching. Sole reliance on professional trainers, whether internal or external, is expensive and, in many instances, redundant. The only irreplaceable capital an enterprise possesses is the knowledge stored in the brains of its people. But the productivity of intellectual capital depends on how effectively the owners share it with those who can use it.

Skill at teaching comes naturally to a few; most of us have to acquire it the hard way. Leading companies have therefore adopted the practice of training the trainer, and their experience confirms that content experts learn the art of training more readily than training experts can master unfamiliar technical content. As a bonus, they find, the ad hoc trainers gain new insights and reinforce their own knowledge as they transmit it to others.

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.

Policy Structures


One of the major purposes of organizations is to relate and coordinate individuals and groups separated by task and space. The authority structure helps accomplish this by defining, at least partially, who can tell whom to do what, and who has the authority to make what kinds of decisions and to take what actions. This authority structure is supplemented with a structure of explicit and implicit policies, procedures, methods, and rules, which channel and direct many decisions and actions.

A policy is a statement of intent that is made to guide others in their decision making without being so specific as to specify decisions. Theoratically, the top executives of any company, but especially the larger ones, necessarily determine policies that help guide the behavior of people within the organization. However, in fact, people at lower levels often have an important hand in fashioning policy. This happens in two ways. First, people at lower levels make recommendations to those at upper levels. Second, people in upper levels sometimes formalize policies to fit behavior patterns that have already emerged at lower levels. In the latter case, policy follows practice.

A frequent characteristic of policy statements is that they are vague enough to permit managers to select among specific decesions, depending upon the managers’ view of the specific conditions surrounding the decision.

In addition to policies, certain procedures and methods are usually designed to facilitate work. For example, there may be eight discrete steps in a particular work process, and a sequence established for each step. Step three might involve notifying two departments that the first two steps are completed. Such a suggested process is called a procedure. It tells people when they should do something. How they do it is the method they use. The method is formally prescribed in some cases and is left to the operant’s discretion in others. Anyone who fails to follow the prescribed procedures and methods is usually open to censure if problems result. Yet much of life in organizations involves evading required procedures and methods, or redesigning them, and again the reasons are usually people-problems rather than errors in the logic of the design of the procedures and methods.

Most organizations have rules and regulations to supplement policies, procedures, and methods. Rules and regulations say what one must do or not do and often specify penalties for infractions. “No one is to punch another’s third card” is an example. There are no ifs, ands, or buts about it. It says “no one,” period.

So there is a sliding scale from guides (policies) to suggestions (procedures) to requirements (rules and regulations). Nearly all organizations include the entire svcale, but different companies may vary widely in their relative emphasis upon various parts of the scale. At the less specific end of the scale, there is more freedom but less certainty, and the reverse is true of the more specific end. Knowing where a particular organization stands on the scale is thus important in understanding how it functions.

Furthermore, there is wide variability between organizational units (eg., research division versus accounting department) in the reliance placed upon or the attention paid to the policy structure.

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