After studying this chapter you will: Understand why turning a marketing plan into a profitable business requires money, information, people, and a way to get or produce goods and services; understand the ways that marketing strategy decisions may need to be adjusted in light of available financing; understand how a firm can implement and expand a marketing plan using internally generated cash flow;...
Chapter 20: Managing Marketing’s Link with Other Functional Areas For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill Chapter 20 Objectives When you finish this chapter, you should Understand why turning a marketing plan into a profitable business requires money, information, people, and a way to get or produce goods and services Understand the ways that marketing strategy decisions may need to be adjusted in light of available financing. Understand how a firm can implement and expand a marketing plan using internally generated cash flow. Understand how different aspects of production capacity and flexibility should be coordinated with marketing strategy planning 202 Understand the ways that the location and cost of production affect marketing strategy planning Know how marketing managers and accountants can work together to improve analysis of the costs and profitability of specific products and customers. Know some of the human resource issues that a marketer should consider when planning a strategy and implementing a plan Understand the important new terms For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill The Finance Function: Key Concepts ?????? ?????? ?????? ?????? ?????? 203 Capital Capital Working Working Capital Capital Sources Sources of of Capital Capital Debt Debt Financing Financing Cash Cash Flow Flow Statement Statement For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill The Production Function: Key Concepts ?????? ?????? ?????? ?????? ?????? 204 Production Production Capacity Capacity Excess Excess Capacity Capacity Shared Shared Distribution Distribution Virtual Virtual Corporation Corporation Mass Mass Customization Customization For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill The Accounting Function Natural Accounts Functional Accounts Adapt Accounting Data Marketing Cost Analysis and Interpretation 205 For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill Functional Cost Account Allocations Functional Cost Account Allocations Sales calls Billing Packaging units costs Advertising Exhibit 204 206 $1K/100calls $424/34 orders = $10.00/call = $12.50/order $2,312/1,360 units = $ 1.70/unit or $ 1.70/Product A $ 5.10/Product B $10.20/Product C = $42.50/unit of C $425/10 units of C Functional allocation breaks down costs by activity. Remember, though, this breakdown is seldom the whole story. Market managers still need to interpret this information to assess performance in a meaningful way For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill The Human Resources Function ??????? ??????? ??????? ??????? ??????? 207 People People are are aa Resource Resource New New Strategies Strategies Need Need New New People People Communication Communication Rapid Rapid Growth Growth For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill Key Terms Capital Working Capital Debt Financing Cash Flow Statement Production Capacity Virtual Corporation Mass Customization Task Transfer Natural Accounts Functional Accounts 208 For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc., 1999 Irwin/McGraw-Hill ... Function Natural Accounts Functional Accounts Adapt Accounting Data Marketing Cost Analysis and Interpretation 20 5 For use only with Perreault and McCarthy texts © The McGraw-Hill Companies, Inc.,... Irwin/McGraw-Hill Key Terms Capital Working Capital Debt Financing Cash Flow Statement Production Capacity Virtual Corporation Mass Customization Task Transfer Natural Accounts Functional Accounts 20 8... Capital Capital Sources Sources of of Capital Capital Debt Debt Financing Financing Cash Cash Flow Flow Statement Statement For use only with Perreault and McCarthy texts © The McGraw-Hill Companies,