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Extra info for CIMA Exam Practice Kit: Integrated Management (Cima Exam Practice Kit)
Supplier power This is the power of suppliers over people in the industry. Key factors which create a high force are • few alternative suppliers • cost of changing suppliers is high. Substitute products Substitutes are products which fulfil the same needs as the needs met by the product in the industry being examined. A substitute of trains might be coaches, buses or cars for example. If customers can have their needs met from many different types of products they will react to increases in prices or poorer service by switching to substitute products.
Individuals often act within the standard norms of group behaviour. If, for example, people generally take a short lunch break it is likely that a new employee will too, even if this is not stated in the company’s policies. Such cultural norms can have a dramatic effect on the organisation and success, particularly when such norms relate to attitudes to • • • • • • • working hard or long hours loyalty innovation quality customers meeting deadlines support for others. Influences on culture The culture of an organisation can be influenced by many factors including • • • directors owners staff 27 28 Exam Practice Kit: Integrated Management • • • • firm history national cultures organisational structure strategic approach.
Mission Vertical consistency1 Corporate objectives Business objectives 1 Lower-level objectives should be consistent with higher-level objectives to ensure that each part of the organisation is acting in a way which is appropriate to the needs of the next level up. Operational/functional objectives Individual objectives Horizontal consistency2 2 The objectives of different departments, individuals, or businesses are consistent with other parts of the business at the same management level, ensure that internal conflict is avoided and that co-ordination is achieved.