Business Dictionary

The most important rule in the success of a business

2011-12-28T09:03:00.000-08:00

Success and business

Today I was thinking about the most important rule in business. well what is the most important rule in business from your point of view? or let me to put it in another way, what you need to learn to be successful in business?
Think about it for some minutes then high light the answer in coming lines.

The most important rule in business is RESPECT my friends.

Learn to respect to yourself and your customers. Look at business world and see the most important figures . They all are respectable people. They have their own personal disciplines and they respect to customers they offer more value at less cost and provide the best service they are capable of. They don't expect customers to bring benefit for them they all are trying to provide benefit for clients. The art and the hard part of business is this to try hard and think smart to do so and this comes from the rule of respect.

Facebook page

2011-12-28T07:52:00.000-08:00

Hi every body!
I started a Facebook page about starting your own business this is the Facebook page address :
https://www.facebook.com/pages/Business-Startup/293545457363268
there I will inform you about latest posts and latest interesting events in the web for those who are interested in business development.

Good luck!

Four Actions Framework

2011-12-27T14:42:00.000-08:00

What is four actions framework?

Four Action Framework

4 Actions Framework is one of Blue Ocean Strategy tools, used by managers to reconstruct values offered to customers, in a new way that breaks the differentiation/low cost trade-off. It forces the organization to ask the following four questions:

1. Which of the factors that the industry takes for granted should be eliminated?

This question considers elimination of factors that may have made sense in the past, but do not make sense or create value now.

2. Which factors should be reduced well below the industry's standard?

This question forces the business planners to consider reducing factors that may have been over-designed in the race to beat the competition.

3. Which factors should be raised well above the industry's standard?

The third question forces managers to uncover and eliminate the compromises that the industry has forced buyers to make.

4. Which factors should be created that the industry has never offered?

The fourth question is about discovering new sources of value for buyers.

The first two questions address the low cost and last two questions are designed to create differentiation.

You can use the following table for answering the questions. This helps you to consider all four forces simultaneously.

Eliminate	Raise
Reduce	Create

Blue Ocean Strategy

2011-12-27T13:56:00.000-08:00

What is Blue Ocean Strategy?


Blue Ocean Strategy

Yet there are many managers who believe that for wining a the game of business your service or products souled be either Cheap or Different. By Different I mean some features that customers won't find in competitor's offers. Michel Porter in his ground braking work Competitive Advantage 1985 defines his generic sources of competitive advantages, and defines that a company cannot get both.
However, Kim and Mauborgne in their well known work Blue Ocean Strategy tell abother story, Authors suggest that instead of competing in red oceans on price and differentiation, instead of bleeding in marginalized markets, lets sail to blue oceans and make competition irrelevant. blue ocean strategy has two famous frameworks ' Strategy Canvas ' and ' 4 actions framework '. Blue Ocean Strategy suggest to have a successful business you should create value and offer a new product or service.

I am going to introduce ' Strategy Canvas ' and ' 4 actions framework ' in next posts.

PESTEL

2011-12-17T19:07:00.000-08:00

What is PESTEL?

What is PEST?

PESTEL stands for Political, Economic, Social, Technical, Environment and Legislative, each of which represent a an environmental pressure on a group or organization. It is used as a strategic planning technique that provides a useful framework for an “outside in” analysis. It is recommended particularly for teams and organizations who have become too inward-looking.

PESTEL frame work which don’t have the last two forces is Called PEST frame work?

Flowing comes an example PETSEL framework with subsets.

Political -
- Trading policies
- Employment Law
- Taxation (Corporate;Consumer)

Economic -
- Interest Rates
- Inflation
- Economic growth
- Exchange rates
- stage of business cycle

Socio-Cultural -
- Branding
- Demographics

- Lifestyle changes
- Health and welfare

Technological -
- Stock Control
- Government spending on research
- Energy use and costs

Environmental -
- Packaging
- Recycling

Legal -
- Competition Commision
- Employment Law
- Trade Regulations

SWOT analysis

2011-12-14T11:46:00.000-08:00

What is a SWOT analysis?

SWOT is an acronym for Strengths, Weaknesses, and Opportunities and Threats. SWOT is a simple but power tool that decision makers use for analyzing internal and external environment for an informed planning of next steps. SWOT is usually demonstrated as 2x2 matrix having Internal (S&W) and External (O&T) factors in one axis and Favorable (S&O) and Unfavorable (W&T) factors on the other axis.

By providing information that is helpful for creating a match between the organization’s capabilities and resource from inside-out perspective to the competitive environment of the organization from outside-in perspective, SOWT analysis covers both perspectives. However, “fitting internal strength and weaknesses to external opportunities and threats is often frustrated by the fact that the two sides pull in opposite directions- the distinctive resource base and activity system of a firm can point in totally different direction compared with developments in current markets”( Dewit and Meyer, 2004)

	Favorable factors	Unfavorable factors
Internal factors	Strengths	Weaknesses
Internal factors	Characteristics that gives an advantage over the others.	Characteristics that put the organization at an inferior position compared to the others, the disadvantages can be lack of advantages or even flip side of an advantage that has also negative sides.
External factors	Opportunities	Threats
External factors	Factors that could help to improve competitive advantage	Factors that could cause trouble.

Utilizing the analysis helps the decision maker with different options:

to match strength to opportunities

to convert the weakness to strength

to avoid threats

to develop current strength

or any combination if them.

De Wit Bob and Meyer Ron Strategy: Process, Content, Context (an International Perspective) [Book Section]. - Minneapolis/St. Paul : International Thompson, 2004. - Vol. 3rd editoin.