Marketing mix is a fundamental business tool that outlines the four key components of any product or service: product, price, promotion and place. Acting as a short-cut, the marketing mix allows marketers to easier envision an optimal brand’s offering. The framework was originally coined in the 1960’s by a marketer by the name of E. Jerome McCarthy and since then became popular and has been used throughout the world.
This category includes a wide range of offerings. In fact, a product or a service can be anything that satisfies a customer demand, whether tangible or intangible. For example, a car, a disposable razor or a software program – all fall under the tangible category. In order to create value for customers and the firm, marketers need to make decisions about the product, such as: brand, size, quality, features, packaging, warranty, etc. Once these key product characteristics have been identified, the marketing team can then move on to determining the price of the offering.A service, on the other hand, usually falls under an intangible category, such as a technical support experience, a haircut or a plane flight.
Price is a crucial component of the marketing mix for two reasons. First, it is a major determinant of the company’s profit and therefore company’s success on the market. Secondly, it affects how valuable the customer finds the product or service. On the one hand, the less the customer has to give up in order to receive something, the more valuable he or she will perceive it to be. On the other hand, certain luxury goods and services (e.g. a high-end car, a business class flight, a designer dress, etc.) are sometimes perceived as more valuable as a result of their higher price.Aside from money, price also includes other things a customer is willing to give up in return for the product or services, such as time and effort.
From the marketer’s perspective, determining the price could also involve determining the following: discounts, allowances, costs, payment periods and credit terms.
Promotion includes providing information and communicating value to potential customers. Such communication can be used to persuade and remind potential customers, influence and enhance their opinion of product or service, as well as elicit a response. The multiple methods of promotion include: advertising, public relations, sales promotion, celebrity endorsements, product placement and word-of-mouth. Marketers task is to determine which method(s) better suits the target audience.
Of the 4P’s of the Marketing Mix, place is an often undervalued component. However, place refers to the distribution of goods or services from the manufacturer/provider to the consumer. This process includes multiple stakeholders and therefore involves higher risk. A few examples of such intermediate agencies are: marketing channels, retailer locations, supply chain, etc. Therefore, it is crucial to create a well-functioning logistics, so that the product or service is delivered on time and conveniently for the customer. To do that a mix of strategies like intensive distribution, selective distribution, exclusive distribution and franchising can be used.
Project Priority Matrix – Project Priority Matrix Analysis – Project Priority Matrix Framework – Business are often facing a number of competing projects. Prioritizing between projects becomes essential in order to maximize benefits for a company.
A project priority matrix is a great management tool to selecting those engagements that carry the highest benefits to an organization. The matrix divides all projects by the ease of implementation and their impact. Highest impact and the easiest to implement projects should be completed first. The projects are divided between quick wins, must haves, low hanging fruit and money pits. See the priority matrix below.
Strategy Matrix – Strategy Matrix Analysis – Strategy Framework – Many strategy analysis frameworks have been developed over the years. The strategy matrix tries to define the outcome of the various strategies by identifying whether the activities facing the firm are core vs. critical vs. commodity and whether a firm wants to produce, partner or purchase the good from another supplier.
If a firm defines something as its core, i.e. the ultimate strategic value, then it should not purchase this service from another supplier, otherwise it is risking to lose the competency. The matrix effectively tells you whether the strategy is a good one depending on the type of activity and purchasing strategy.
Force Field Analysis – Force Field Analysis Framework – Force Field Business Methodology – Force field analysis is an approach to depict various forces or factors that are influencing a given business situation. It divides all relevant business forces into those that are supporting the goal and those that are hindering it. Furthermore, it identifies a perceived magnitude of each of the forces.
The force field framework is also used in social psychology and organizational development. The relevant forces are changing over time and you need to update the analysis as required. The following is an example of the force field analysis.
Affinity – Affinity Diagram – Affinity Analysis – Affinity Framework – Affinity diagrams are used to organize ideas and data during a brainstorming session. The ideas are grouped and segmented by various topics and/or relationships. Affinity diagrams are usually completed on yellow post notes.
The affinity charts are widely used within the practice of project management are one of the key 7 management and planning tools. This is also often referred to as a KJ Method. Essentially, the affinity process consists of two main steps – 1. record your ideas 2. look for relationships and organize ideas into meaningful buckets.
Value Net – Value Net Analysis – Value Net is a business framework that recognizes relationships between a company, its competitors, customers, suppliers and complementors (i.e., complementing products). This methodology focuses on competitive analysis and is somewhat similar to Porters Five Forces. Value net framework emphasizes linkage between the key competitive forces and firm’s complements.
The framework helps identify rivals, partners, suppliers, customers and connections between them, including competitive dynamics and power relative to the key players in the industry. Overall, Value Net model is a good approach to solving business problems in relation to company’s competitive position.
CDSTEP – CDSTEP Marketing Diagram – Cdstep Marketing Analysis – Cdstep Marketing Framework – Cdstep Marketing Business Methodology – Cdstep Marketing model is a marketing tool that shows various components of marketing including immediate environment such as customers, company, competitors and outside environment.
The outside environment includes the following macro environmental factors: demographics, culture, social, legal, political, technology and economic environments. Essentially, cdstep is showing that marketing is more than just communication of a product to a consumer, it is very much dependent on the surrounding environment. Below is the cdstep marketing strategy diagram.
Growth Strategy Matrix – Growth Strategy Matrix Analysis – Growth Strategy Matrix Framework – Growth Strategy Matrix Business Methodology – Growth strategy model prescribes a type of strategy depending on whether the markets are existing or new and whether the product is existing or new.
The four growth strategies are: market penetration, market development, product development and diversification. When market is fully penetrated, it is advised for businesses to either proceed with the market development for existing product or product development for existing market. Diversification is usually difficult to achieve. Below matrix identifies various growth strategies and gives examples of real businesses.
Sales Strategy – Sales Strategy Analysis – Sales Strategy Framework – Sales Strategy Business Methodology – Sales Growth Strategy model helps a business to grow its revenues. There are a number of strategies that can be used to achieve sales growth; these include: increasing sales per customer, stealing customers from competition, expanding to new markets and developing new products.
Each of the above strategies has its own implementation plan. For example for increasing sales per customer this includes offering bulk discounts and expanding loyalty programs. Below diagram outlines various sales growth strategies.
Motivation, defined in relation to employees in the workplace, is the extent to which persistent effort is directed towards a goal. The different factors motivating employees at work can be further subdivided into two broad categories – extrinsic and intrinsic. Extrinsic motivation stems from the work environment external to the task and it is usually applied by others (e.g. regular salary, fringe benefits, cash awards for excellent performance, etc.). Alternatively, intrinsic motivation, is thought to result from the direct relationship between the worker and the task and to come from within (e.g. one’s interest in the task, feeling competent, recognition, etc.).
While certain motivational factors fall clearly within these categories, there is some degree of overlap. For example, receiving a compliment or a promotion from a boss are both examples of extrinsic motivation. At the same time both are targeted at eliciting a positive feeling of competence and/or recognition of one’s achievement, both of which fall under the intrinsic motivation category.Thus, a given motivational event can be part-intrinsic and part-extrinsic.
It is also true that most of the employees are motivated by a variety of factors which are likely to come from both categories. Managers need to be aware of the diversity in the workplace and realize that the same conditions will not motivate everyone. Flexibility to employees’ needs is especially important given the increasing productivity demands placed on modern organizations. To stay globally competitive organizations need to replace rigid systems of rules, regulations and procedures by higher levels of initiative among its employees, which would help deliver greater levels of attention to customer needs. This, of course, requires that employees be motivated to add value by looking for ways to improve their performance as opposed to doing a base-line or even sub-par job.
How does a manager, then, determine what kind of motivation would work best for his or her employees? A few conclusions supported by a review of motivational research may help guide the search for optimal motivators.
First, employees motivated by intrinsic factors feel more in control of their motivation, as opposed to those motivated by extrinsic rewards. This results in more effective performance, especially on complex tasks. Therefore, if a manager’s goal is to solicit a performance improvement that may require the employee to identify and analyze possible deficiencies in their current job, the manager would need to ensure that the employee is intrinsically motivated.
This conclusion relates to the second fact discovered by a review of motivational research. It has been shown, that availability of extrinsic motivation may reduce the intrinsic motivation stemming from the task itself. In other words, when employees believe that they perform well as a result of external rewards, it makes them feel less in control of their own behaviour diminishing the power of the intrinsic motivation.
However, such negative effects of extrinsic rewards occur only under limited conditions and are avoidable. Moreover, in line with the idea of the blurred line between extrinsic and intrinsic motivation categories, when extrinsic rewards are seen as symbols of achievement they increase task performance. Thus, both reward types are important and should be combined to achieve greatest employee motivation in the workplace.
Change Management – Change Management Analysis – Change Management Framework – Change Management Business Methodology – Change management is a step-by-step process that enables an organization to achieve transformation.
Change is painful for the organization, its employees and culture. While in transition, many employees are unhappy, and communication and motivation become key in making sure everyone is aligned with the change and its impact (e.g. technological or process change). Below is an examples of a change management process.
Sustainable Competitive Advantage – Sustainable Competitive Advantage Analysis – Sustainable Competitive Advantage Framework – Sustainable Competitive Advantage Business Methodology – Competitive Advantage is a favorable relevant position of a company in a market place above its competitors. This may include possession of a superior product, better supply chain, talented workforce, etc.
The sustainable competitive advantage is essentially a recurring or continuous favorable position in regards to competitors. Some argue that this is the holy grail of business, something everybody dreams of but no one is really able to achieve unless one is a monopoly in the market and is protected from other market participants. However, this does not mean one should give up trying and if location, operational, product and customer excellence are achieved, at least temporary, the customer value is created and the competitive advantage is achieved.
Harvey Balls – Harvey Balls Analysis – Harvey Balls Framework – Harvey Balls Business Methodology – Harvey Balls is one of the most widely used visualization tools to indicate the maturity and/or level of business challenges base on a simple scoring method. Essentially the score is 1 to 5 with a full circle representing a 5 and an empty one representing 1.
The Harvey balls can instantly tell you, which business processes require attention and, which are well-functional. This is an alternative to a heat map. Below sample images are examples of how Harvey Balls are used in business presentations.
Project Management – Project Management Analysis – Project Management Stages – Project Management Framework – Project Management Business Methodology – Project Management model is one of the top business frameworks used for managing and leading projects and other kind of engagements. The model brings some structure to the project phases and makes it more organized.
The project stages include initiation, planning and design, executing or implementation, monitoring and controlling, closing. There may be other stages depending on the nature of the work. Work planning varies depending on the resources assigned, project timelines, etc. Below sample images are examples of Project Management stages.
Time Cost Quality – Time Cost Quality Analysis – Time vs. Cost vs. Quality Trade-offs – Time Cost Quality Framework – Time Cost Quality Business Methodology – Time Cost Quality model is one of the business strategy frameworks that states that you can provide a product which is either of low cost, high quality or delivered quickly or a combination of any of the two components. However, because of the trade-offs, you cannot have all three.
This has been disputed somewhat in recent history and many companies are trying to achieve all three. Think of an Apple’s Iphone when it first came out, it was so revolutionary that you could argue that it met all three criteria. New inventions and blue ocean ideas can sometimes break the tradeoffs associated with time, cost and quality and allow for all three to be present as part of one’s product. Below sample images are examples of Time vs. Cost vs. Quality frameworks used in business management.
Process Map – Process Map Analysis – Process Map Framework – Process Map Business Methodology – Process Mapping is a tool to documenting business processes and is an effective way to think about the inefficiencies associated with each process step. Process mapping is used as part of the Lean Six Sigma toolkit. There may be few process levels with Level 1 usually representing the high level view, level 2 is more detailed with level 3 focusing on procedural.
Key process map symbols include boxes, which represent steps and procedures, diamonds are decision points.
Below sample image is an examples of a Process Map used in business management with legend and explanations on what each symbol means.
Customer Lifecycle – Customer Life Cycle – Customer Lifecycle Analysis – Customer Lifecycle Framework – Customer Lifecycle Business Methodology – Client Lifecycle model is a key business strategy tool that shows the customer loop from the very initiation through purchase to advocacy. The importance of this framework is in the fact that the client goes through a number of stages and a business needs to be aware of these lifecycle stages and travel with the customer at each phase. There should be a tactic or a strategy for each of the customer phases that a company needs to think of.
Below sample Customer Life cycle chart is a useful business management tool. The stages include: awareness, knowledge, consideration, selection, buying, satisfaction, loyalty and advocacy.
5S – Kaizen 5S – 5S Analysis – Five S – 5S Framework – 5S Business Methodology – 5S model is an approach to solving business problems. Below sample images are examples of 5S used in business management.
5S is a Lean Six Sigma structured method to getting a workplace cleaned up (eliminating waste), organized, standardized and then sustaining the improvements made. Five S name is based on the five Japanese words starting with S. Below is the image of this framework and key benefits of 5S model.
5 Why – 5 Why Analysis – Five Why – 5 Why Framework – 5 Why Business Methodology – 5 Why model is one of the fundamental lean six sigma frameworks and is essential in looking for the root cause of waste and business challenges.
Level after level, 5 WHYs are meant to unpeal symptoms to get to the root cause of an issue. The limit is placed on a number five because looking beyond may not be as viable and will probably go as far as a psychological issues of the business owners; Lean recognizes that psychology is not its competence 🙂 and that the focus is to be at a business level. Below sample images are examples of 5 Why-s used in business management.
Bullwhip Effect – Bullwhip Effect Analysis – Bullwhip Effect Framework – Bullwhip Effect Business Methodology – Bullwhip Effect is one of the recongnized recurring issues whereby a sudden spike or a decline in demand from a customer results in much bigger effect on the supply chain.
The longer the supply chain, the more pronounced is the effect with potentially huge variations and volatility for producers of raw materials. Understanding of this effect should limit managers mistakes when it comes to overproduction, ordering of goods and meeting customer demand. Below sample images are examples of Bullwhip Effect.