Business Studies III: Operations Management and Marketing
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Operations Management
Operations management designs, controls, and improves the processes that transform inputs (materials, labour, information) into outputs (goods and services) (Slack et al., 2016).
- Functions: product and process design, capacity planning, location and layout, scheduling, inventory control, quality management, and maintenance.
- Types of production: job, batch, mass (flow), and continuous production; the nature of services (intangibility, simultaneity, perishability).
- Productivity = output ÷ input.
- Quality management: quality control and assurance; total quality management (TQM); Six Sigma; ISO 9001 quality management systems; standards bodies such as the SLSI.
- Inventory management: purpose, costs, EOQ, reorder points, ABC analysis, and just-in-time (JIT).
- Supply chain management: sourcing, logistics, distribution; coordination with suppliers and customers.
- Lean operations: reduce waste; productivity improvement and technology (automation).
- Operations and sustainability: energy and waste reduction.
Marketing Management
Marketing is the process of identifying and satisfying customer needs and wants profitably (Kotler & Keller, 2016). Core concepts include needs, wants, demands, products, value, exchange, and markets.
Marketing orientations: production, product, selling, marketing, and societal marketing concepts.
The marketing process: analyze opportunities; segmentation, targeting, and positioning (STP); design the marketing mix; implement and control.
| Marketing mix (4Ps) | Decisions | Extension for services (7Ps) |
|---|---|---|
| Product | Features, quality, branding, packaging, product life cycle | People |
| Price | Cost-plus, competition-based, value-based; penetration or skimming | Process |
| Place (distribution) | Channels, intermediaries, logistics | Physical evidence |
| Promotion | Advertising, personal selling, sales promotion, public relations, direct and digital marketing |
- Product life cycle: introduction, growth, maturity, and decline, with different strategies at each stage.
- Consumer behavior: the buying process (need recognition, search, evaluation, purchase, post-purchase); influences (cultural, social, personal, psychological).
- Marketing research and information systems: collecting and analyzing data about customers and the market.
- Digital marketing: websites, search engine optimization, social media, email, and online advertising; e-commerce.
- Marketing environment: customers, competitors, and the macro environment.
- Marketing plan: situation analysis, objectives, strategy, mix, budget, and control (Kotler & Armstrong, 2020).
- Ethics: honest advertising, consumer protection, and responsible marketing to children.
Common Mistakes
- Treating marketing as only selling or advertising.
- Listing the 4Ps without applying them to a real example.
- Forgetting that price strategies must consider cost, demand, and competition.
CHAPTER 12