Not-for-Profit Marketing


Non-for-Profit organizations encounter a special set of characteristics that influence their marketing activities. Like profit making firms, not-for-profit organizations may market tangible goods and/or intangible services. One important distinction exists between not-for-profit organizations and profit oriented companies. Profit-seeking businesses tend to focus their marketing on just one public—their customers. Not-for-profit organizations, however, must often market to multiple publics, which complicates decision-making regarding the correct markets to target. Many deal with at least two major publics—their clients and their sponsors—and often many other publics, as well. Political candidates, for example, target both voters and campaign contributors. A college targets prospective students as clients of its marketing program, but it also markets to current students, parents of students, alumni, faculty, staff, local businesses, and local government agencies.

A second distinguishing characteristic of not-for-profit marketing is that a customer or service user may wield less control over the organization’s destiny than would be true for customers of a profit-seeking firm. A government employee may be  far more concerned with the opinion of a member of the legislature’s appropriations committee than with that of a service user. Not-for-profit organizations also often possess some degree of monopoly power in a given geographic area.

Perhaps the most commonly noted feature of the non-profit-organization is its lack of a bottom line—business jargon referring to the overall profitability measure of performance. Profit-seeking firms measure profitability in terms of sales and revenues. While not-for-profit organizations may attempt to maximize their return from specific services, they usually substitute less exact goals, such as service-level standards, for overall evaluation criteria. As a result, it is often difficult to set marketing objectives that are aligned specifically with overall organizational goals.

A typical aspect of a non-for-profit organization is the lack of a clear organizational structure. Not-for-profit organizations often respond to constituencies that they serve, but these usually are less exact than, for example, the stockholders of a profit-oriented corporation. Not-for-profit organizations often have multiple organizational structures.

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 Stewardship Principle


Many of today’s corporate executives see themselves as stewards, or trustees, who act in the general public’s interest. Although their companies are privately owned and they try to make profits for the stakeholders, business leaders who follow stewardship principle believe they have an obligation to see that everyone—particularly those in need—benefits from the company’s actions. According to this view, corporate managers have been placed in a position of public trust. They control vast resources whose use can affect people in fundamental ways. Because they exercise this kind of crucial influence, they incur a responsibility to use those resources in ways that are good not just for the stockholders alone but for society in general. In this way, they have become stewards, or trustees, for society. As such they are expected to act with a special degree of social responsibility in making business decisions.

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.

Pressure Groups


Big businesses, big labor, and big government are giants on the economic scene. As a pressure group or interest group, each tries to achieve its own objectives. And of course the major objective of a business is to earn profits. Some are more successful than others. To become and stay successful, big businesses employ full time representatives to fight for and protect their interests with government and consumers alike.

Labor is big too. The pressuring power of unions  is evidenced by such accomplishments as minimum wage laws and 40-hour work weeks. Big government now employs large share of all workers in its agencies, departments, and programs. Pressure from government is felt through such actions as taxes, environmental protection laws, and anti-trust legislation.

There is a wide variety of other types of pressure groups such as the media, professional organizations, neighborhood organizations, and dissident stockholder groups. Large and small pressure groups work vigorously to influence business, labor, and government in directions favorable to their own interests.

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.

Getting a Corporate Charter


The first step of incorporation is to submit a formal application, usually to the secretary of state in the state in which you want to incorporate. This becomes the corporate charter, the document usually includes the name, address, and purpose of the business, a listing of the board of directors and the principal stockholders, the types of stocks to be used by the company, and the mechanism to be used for amending the charter. Incorporation usually takes place when this corporate charter is approved by the state.

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.

 

Corporate Giving


One of the most visible ways in which businesses help communities is through gifts of money, property, and employee service. The corporate philanthropy or corporate giving demonstrates the commitment of businesses to assist the communities by supporting nonprofit organizations.

Some argue that corporate managers have no right to give away company money that does not belong to them. According to the line of reasoning, any income earned by the company should be either reinvested in the firm or distributed to the stockholders who are legal owners. The charitable contributions are one additional way in which companies link themselves to the broader interests of the community, thereby advancing and strengthening the company rather than weakening it.

Companies also help local communities through the substantial number of business donations that are not recorded as philanthropy because they are not pure giving. Routine gifts of products and services for local use often are recorded as advertising expenses; gifts of employee time for charity drives and similar purposes usually are not recorded; and the costs of soliciting and processing employee gifts, deductions usually are not recorded as corporate giving. Still, they add value to the local community of which the company is part.

Many large US companies have established nonprofit corporate foundations to handle their charitable programs. This permits them to administer contribution programs more uniformly and provides a central group of professionals that handles all grant requests. Foreign-owned corporations use foundations less frequently, although firms use highly sophisticated corporate foundations to conduct their charitable activities. As corporations expand to more foreign locations, pressures will grow to expand international corporate giving. Foundations, with their defined mission to benefit the community, can be a useful mechanism to help companies implement philanthropic programs that meet corporate social responsibility.

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.

 

Corporate Disclosures


Giving stockholders more and better company information is one of the best ways to safeguard their interests. The theory behind the move for greater disclosure of company information is that a stockholder, as an investor, should be as fully informed as possible to make sound investments. By law, stockholders have a right to know about the affairs of the corporation in which they hold ownership shares. Those who attend annual meetings learn about past performance and future goals through speeches made by corporate officers and documents such as the company’s annual report. Those who do not attend meetings must depend primarily on annual reports issued by the company and the opinions of independent financial analysts.

Historically, management has tended to provide stockholders with minimum information. But companies now disclose more about their affairs, in spite of the complicated nature of some information. Stockholders therefore can learn about sales and earnings, assets, capital expenditures and depreciation by line of business, and details of foreign operations.

Corporations also are required to disclose detailed information about directors, how they are chosen, their compensation, conflicts of interest, and their reasons for resigning in policy disputes with management.

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.

 

Public Relations (PR)


Public Relations is the management function that evaluates public attitudes, identifies the policies and procedures of an individual or an organization with the public interest, and executes a program of action to earn public understanding and acceptance. In other words a good public relations program has three steps:

  1. Listen to the public: Public relations starts with good marketing research (evaluates public attitudes).
  2. Develops policies and procedures that are in the public interest: One does not earn understanding by bombarding the public with propaganda; one earns understanding by having programs and practices in the public interest.
  3. Inform people of the fact that you are being responsive to their needs: It is not enough to simply have programs that are in the public interest. You have to tell the public about those programs so that they know you are being responsive.

Publicity is one of the major functions of the public relations department. Publicity is any information about an individual, a product, or an organization that is distributed to the public through the media and that is not paid for, or controlled by, the sponsor.

Other activities include:

  • Establishing contact with civic groups, consumer organizations, and other concerned citizens to learn their views of the organization, to answer their questions, and to provide information (or education).
  • Opening lines of communication with customers, suppliers, distributors, retailers, stockholders, government agencies, educators, and community leaders.
  • Conducting studies to find the economic, environmental, and social consequences of organizational practices and to learn how to make a more positive contribution to customers, stakeholders, and society.
  • Providing any assistance needed to adjust the goals, policies, practices, personnel policies, products, and programs of the organization to meet the needs of changing markets.
  • Assisting all members of the firm in developing effective programs of consumer information and education.
  • Sending speakers to schools, clubs, and other such groups to maintain an open dialogue with students and other socially active members of society.
  • Creating incentives for employees to participate in public-affairs activities such as raising funds for charitable groups.
  • Answering consumer and other complaints promptly and correcting whatever it was that caused the complint.
  • Training employees or volunteers to provide prompt, friendly, courteous, and helpful service to anyone who contacts the organization in person, by phone, or written correspondence.
  • Demonstrating to society the organization is listening, reacting, adjusting, and progressing in its attempt to satisfy its diverse publics.
  • Opening two-way communications with employees to generate favorable employee opinion and to motivate employees to speak well of the organization to others.

This is an incomplete description of all the activities and responsibilities of the PR people, but it at least gives some feeling for what they do.

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.

 

Corporate Governance


Corporate governance refers to the overall control of a company’s actions. Several key stakeholder groups are involved in governing the corporation.

  • Managers occupy a strategic position because of their knowledge and day-to-day decision making.
  • The board of directors exercises formal legal authority over company policy.
  • Stockholders, whether individuals or institutions, have a vital stake in the company.
  • Employees, particularly those represented by unions or who own stock in the company, can affect some policies.
  • Government is involved through the laws and regulations.
  • Creditors who hold corporate debt may also influence a company’s policies.

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.

Sole Proprietorships


Sole proprietorships, businesses owned and operated by one individual, are the most common form of business organization. Sole proprietorships are generally managed by their owners. Because of this simple management structure, the owner/manager can make decisions quickly. This is just one of many advantages of the sole proprietorship form of business.

Ease and Cost of Formation: Forming a sole proprietorship in relatively easy and inexpensive. In some countries, creating a sole proprietorship involves merely announcing the new business in the local newspaper. Other proprietorships, such as barber shops and restaurants, may require state and local licenses and permits because of the nature of the business. No lawyer is needed to create such enterprises, and the owner can usually take care of the required paperwork.

An entrepreneur starting a new sole proprietorship must find a suitable site from which to operate the business. Some sole proprietors look no farther than their garage or a spare bedroom that they can convert into a workshop or office. Computers, personal copiers, fax machines, and other high-tech gadgets have been a boon for home-based businesses, permitting them to interact quickly with customers, suppliers, and others. Many independent salespersons and contractors can perform their work using a notebook computer as they travel. E-mail and cell phones have made it possible for many proprietorships to develop in the service area.

Secrecy: Sole proprietorships make possible the greatest degree of secrecy. The proprietor, unlike the owners of a partnership or corporation, does not have to discuss publicly his or her operating plans, minimizing the possibility that competitors can obtain trade secrets. Financial reports need not be disclosed.

Distribution and Use of Profits: All profits from a sole proprietorship belong exclusively to the owner. He or she does not have to share them with any partners or stockholders. The owner decides how to use the profits.

Flexibility and Control of the Business: The sole proprietor has complete control over the business and can make decisions on the spot without anyone else’s approval. This control allows the owner to respond quickly or competitive business conditions or to changes in the economy.

Government Regulation: Sole proprietorships have the most freedom from government regulation. Most government regulations apply only to businesses that a certain number of employees, and securities laws apply only to corporations that issue stock. Nonetheless, sole proprietors must ensure that they follow all laws that do apply to their business.

Taxation: Profits from the business are considered personal income to the sole proprietor and are taxed at individual tax rates. The owner pays one income tax.

Closing the Business: A sole proprietorship can be dissolved easily. No approval of co-owners or partners is necessary. The only legal condition is that all loans must be paid off.

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.

Conflict of Interest


A conflict of interest exists when a person must choose whether to advance his or her own personal interests or those of others. For example, a manager in a corporation is supposed to ensure that the company is profitable so that its stockholder-owners receive a return on their investment. In other words, the manager has a responsibility to investors. If she instead  makes decisions that give her more power or money but do not help the company and is not fulfilling her responsibilities. To avoid conflicts of interest, employees must be able to separate their personal financial interests from their business dealings.

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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