Diploma in Primary Education

Components of Educational Administration

Planning
Budgeting
Marketing and Sales
Operation Management

This phase defines how Education

administrators organize and manage the
administration, support systems and
activities that facilitate the effective
running of educational institutions. The
majority are based in higher or further
education with several opportunities being
available in schools and private colleges.

Administrators work on areas like admissions, quality assurance, data management and
examinations or in a specialist department such as finance, careers or human resources. All of
these can be either be centrally based or within faculties, departments or other smaller units.

There are a huge number of possible job titles in the field of education administration with
job descriptions being equally diverse.

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Typical work activities

The range of administrative roles in the education sector is vast and responsibilities can vary
greatly depending on the type of institution and the section or department in which you work.

The responsibilities listed below give an idea of some typical tasks in various roles, but in
educational administration it is unlikely that any two jobs will be exactly the same. Tasks may
include:

servicing committees include academic boards, governing bodies and task groups;
assisting with recruitment, public or alumni relations and marketing
activities;
administering the 'student lifecycle' from registration or admission to
graduation or leaving;
providing administrative support to an academic team of lecturers, tutors or teachers;
drafting and interpreting regulations and dealing with queries and complaint
procedures;
coordinating examination and assessment processes;

maintaining high levels of quality assurance, including course evaluation and course
approval procedures;
using information systems and preparing reports and statistics for internal and
external use;
participating in the development of future information systems;
contributing to policy and planning;
managing budgets and ensuring financial systems are followed;
purchasing goods and equipment, as required, and processing invoices;
supervising staff;
liaising with other administrative staff, academic colleagues and students;
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 liaising with partner institutions, other institutions, external agencies,
government departments and prospective students;
Organizing and facilitating a variety of educational or social activities.

The components of Educational Administration are:

Business Planning

Planning is defined as looking ahead and chalking out future courses of action to be followed.
It is a preparatory step and a systematic activity which determines when, how and who is
going to perform a specific job. Planning is a detailed program regarding future courses of
action. It is rightly said “Well planned is half done”. Therefore, planning takes into
consideration available & prospective human and physical resources of the organization so as
to get effective co-ordination, contribution & perfect adjustment. It is the end function and
basic management which includes formulation of one or more detailed plans to achieve
optimum balance of needs or demands with the available resources.

According to Urwick, “Planning is a mental predisposition to do things in orderly way, to think

before acting and to act in the light of facts rather than guesses”.
Planning is about deciding the best alternative among others to perform different managerial
functions in order to achieve predetermined goals.

According to Koontz & O‟Donell, “Planning is deciding in advance what to do, how to do and
who is to do it. Planning bridges the gap between where we are to, where we want to go. It
makes possible things to occur which would not otherwise occur”.

Business plans are documents used for planning out specific details about your business. They
can range in size from a simple few sentences to more than 100 pages with formal sections, a
table of contents and a title page. According to Entrepreneur Magazine, typical business plans

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average 15 to 20 pages. Comprehensive business plans have three sections- business concept,
marketplace and financial- and these are broken down into seven components that include the
overview or summary of the plan, a description of the business, market strategies, competition
analysis, design and development, operations and management and
Financial information. Even small one-page business plans have importance and purpose for the
success of the business.

Management planning is the process of assessing an organization's goals and creating a

realistic, detailed plan of action for meeting those goals. Much like writing a business plan, a
management plan takes into consideration short- and long-term corporate strategies. The basic
steps in the management planning process involve creating a road map that outlines each task
the company must accomplish to meet its overall objectives.

The various stages in the process of planning are as follows:

1. Goal setting:

Plans are the means to achieve certain ends or objectives. Therefore, the establishment of
organizational or overall objectives is the first step in planning. Setting objectives is the most
crucial part of planning. The organizational objectives should be set in key areas of operations.

They should be verifiable i.e., they should as far as possible be specified in clear and
measurable terms. The objectives are set in the light of the opportunities perceived by
managers. Establishment of goals is influenced by the values and beliefs of executives, the
mission of the organization, organizational resources, etc.

Objectives provide the guidelines (what to do) for the preparation of strategic and procedural
plans. One cannot make plans unless one knows what is to be accomplished. Objectives
constitute the mission of an organization. They set the pattern of the future course of action.

The objectives must be clear, specific and informative. Major objectives should be broken into

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departmental, sectional and individual objectives. In order to set realistic objectives, planners
must be fully aware of the opportunities and problems that the enterprise is likely to face.

Developing the planning premises:

Before plans are prepared, the assumptions and conditions underlying them must be clearly
defined these assumptions are called planning premises and they can be identified through
accurate forecasting of likely future events.

They are forecast data of a factual nature. Assessment of the environment helps to reveal
opportunities and constraints. Analysis of internal (controllable and external (uncontrollable)
forces is essential for sound planning premises are the critical factors which lay down the
bounder for planning.

They are vital to the success of planning as they supply per tenant facts about the future. They
need revision with changes in the situation. Contingency plans may be prepared for alternate
situations.

3. Reviewing Limitations:

In practice, several constraints or limitations affect the ability of an organization to achieve its
objectives. These limitations restrict the smooth operation of plans and they must be
anticipated and provided for.
The key areas of Imitations are finance," human resources, materials, power, and machinery.
The strong and weak points of the enterprise should be correctly assessed.

4. Deciding the planning period:

Once the broad goals, planning premises, and limitations are laid down, the next step is to
decide the period of planning. The planning period should be long enough to permit the
fulfillment of the commitments involved in a decision.

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This is known as the principle of commitment. The planning period depends on several factors
e.g., future that can be reasonably anticipated, the time required to receive capital
investments, expected future availability of raw materials, lead time in development and
commercialization of a new product, etc.

Formulation of policies and strategies:

After the goals are defined and planning premises are identified, management can formulate
policies and strategies for the accomplishment of desired results. The responsibility for laying
down policies and strategies lies usually with management. But, the subordinates should be
consulted as they are to implement the policies and strategies.

Alternative plans of action should be developed and evaluated carefully so as to select the
most appropriate policy for the organization. Imagination, foresight, experience and
quantitative techniques are very useful in the development and evaluation of alternatives.

Available alternatives should be evaluated in the light of objectives and planning premises. If
the evaluation shows that more than one alternative is equally good, the various alternatives
may be combined in action.

6. Preparing operating plans:

After the formulation of overall operating plans, the derivative or supporting plans are
prepared. Several medium range and short-range plans are required to implement policies and
strategies.

These plans consist of procedures, programmers, schedules, budgets, and rules. Such plans are
required for the implementation of basic plans.

Operational plans reflect commitments as to methods, time, money, etc. These plans are

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helpful in the implementation of long-range plans. Along with the supporting, plans, the timing
and sequence of activities are determined to ensure continuity in operations.

7. Integration of plans:

Different plans must be properly balanced so that they support one another. Review and
revision may be necessary before the plan is put into operation. Moreover, the various plans
must be communicated and explained to those responsible for putting them into practice.

The participation and cooperation of subordinates are necessary for successful implementation
of plans. Established ideas should be reviewed periodically so as to modify and change them
whenever necessary.

A system of continuous evaluation and appraisal of plans should be devised to identify any
shortcomings or pitfalls of the plans under changing situations.

Levels of planning

There are three levels of strategic planning: Corporate, business, and functional. A strategy
may be planned at each level, but the plans for every level of an organization should align to
ensure maximum unity of effort. Without alignment, departments and functions will be
working at cross-purposes, and the overall corporate strategy will be less effective. Here is
how strategist views each of the three levels of strategic planning:

Corporate level: Planning at this level should provide overall strategic direction for an
organization, sometimes referred to as the "grand strategy."

This is a concise statement of the general direction which senior leadership intends to
undertake to accomplish their stated mission or vision. A Corporate level strategy is
usually decided by the CEO and the Board of Directors although other senior leaders will

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often contribute to the strategy formulation. Strategic options at the corporate level
will likely require a commitment of a significant portion of the firm's resources over an
extended period, and the results will have a significant impact on the future health of
the organization. Strategic planning at this level will usually include a robust analysis
and identification of several strategic options based on the assumed future operating
environment. In a multi-business firm, careful consideration will be given to the overall
core competencies of the firm and where the boundaries lie between corporate and
business level responsibilities.

Business level: Each business within an organization will develop a strategy to support
the overall business within its specific industry. A business-level strategy reflects the
current position of the firm within its industry and identifies how the available
resources can be applied to improve the position of the firm in relation to its
competitors. There are a variety of ways that businesses will compete, but more often
than not it is based on the USP (unique selling proposition) of the firm which
distinguishes the company and its products from other competitors. If there are no
differences between one firm's products or services from other competitors, then the
product or service becomes a commodity. Competition among firms that offer
commodities is usually rooted in price competition, and the low-cost providers usually
take over. On the other hand, businesses that distinguish themselves can compete on
their unique selling proposition. If they can successfully demonstrate why they are
different and how that difference can provide a better level of service or quality
product, then the business can command a higher margin for the premium service or
product. This is the "value" added by the firm, and the business strategy should focus on
how the firm adds value.

Functional level: Functional level describes support functions of a business: Finance,

Marketing, Manufacturing, and Human Resources are a few examples of the functional
level. Strategies at this level should be defined to support the overall business and
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 corporate level strategies. If the functional level leaders can describe their activities
and goals in relation to the business or corporate levels, then everyone in the
organization will be aligned and as such contribute to the overall goals and objectives
for the organization. So for example, functional leaders for IT or HR must ask if the
strategies for their functions match and support the overall strategic direction of the
businesses they support or of the overall firm itself.

Approaches to business planning

Managers may take different approaches to business planning. However, successful managers
know to plan all aspects of their businesses. When planning a business, you need to know
where you stand in the market, what government regulations exist and how you will operate
your business. You also need to consider what distribution outlets will work best for you
business. The key to planning your business is writing a comprehensive business plan before
opening your doors.

Employee’s one aspect of business planning includes hiring the right employees. Know what
types of employees you need to run your business. For example, hiring managers and sales reps
to cover your markets, bring financial people aboard to help better help you obtain financing
and manage your budget. Determine how many people you will hire in a given year, and what
salaries you can afford to pay. Also, determine which methods you will use to recruit your
employees: online ads, executive search firms or newspaper ads.

Market Analysis
Managers also need to study their markets and industries as part of their planning. Determine if
there is room for another competitor like yours in the industry if you are just starting out. One
way to accomplish this is by studying the market share of key competitors. Market share is the
percentage of unit and dollar sales competitors wield in the marketplace. If there are too
many well-established competitors in a certain market, consider a niche or specialty market.

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Most market share information is available in online industry reports. Additionally, decide what
group of customers you are targeting, according to the Small Business Administration. Define
your target customers by certain lifestyles: active people, for example, or demographic
characteristics such as age and income.

Products and Services

Management business planning also includes outlining the products or services you will be
selling. Write detailed descriptions of your products, including features, sizes, scents, flavors,
weights, and dimensions. Decide how you will price your products or services. Also, determine
what makes your products unique versus key competitors. For example, you may be the
quality leaders in your industry because of your superior engineering. Plan to use your key
product strengths to your advantage by communicating them through brochures and in person
to customers.

Advertising
Plan your advertising mix and budget. Your advertising mix pertains to the types of
advertising media you will use, and the percentages you will allot for each media. For
example, you may plan to spend $25,000 on advertising each month. Fifty percent of your
advertising or $12,500 may go toward local television ads, 25 percent to Internet marketing
and the rest to direct mail and newspaper advertising. Plan to test your ads so you know
which ads are eliciting the greatest responses. Change your advertising mix when necessary.

Purpose of business planning

Most companies realize that creating a business plan is ideal, but what they don‟t often
realize is just how valuable one can be. Know the benefits of having a plan and having the
right business plan software can help some business owners determine whether to take the

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time to build one.

The 10 tips below can help business owners determine the real value of developing a
comprehensive business plan. In some cases, a summarized version of a full business plan may
be all that is needed to help a business visualize their future goals or determine their next
option in business growth.

Business plans are designed to express a purpose in such a way that it is easy to see how the
results will impact the bottom line. Business is about making money, and business plans can help
move a business from a start-up to a money-making prospect.

A well-written business plan will help to forecast the future, even if the future is not well
known.

Business plans help determine the best way to allocate scarce resources, such as budgets,
inventory, and other assets. By projecting a company‟s financial vision, a business plan
can help leaders avoid pitfalls that may lead to failures along the way.

A business plan can help to clarify business niche and growth potential. A great idea can
end up bogged down in unnecessary changes resulting from poor planning or
consideration. A business plan helps to delineate some of these ideas before they result in
failures.

For businesses hoping to get capital or start-up funding, a business plan is a must. Many
funding sources won‟t even consider investing without a formal business plan that outlines
the future potential of the business.

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Successful business leaders know that a well-written business plan can provide day-to-day
operational assistance. Organizations that stay focused on their business plan have a
higher chance of success; when used as a roadmap, it can help business leaders stay
focused on business growth, mission, and goals.

A comprehensive business plan will, of necessity, include a marketing element. The

marketing research data can help business leaders hone in on their markets and how those
markets can best be reached. Knowing how their product's market is similar or different
from others can be very useful in helping build and promote their brand and services.

For start-ups, a business plan is not optional if success is to be maximized. Business plans
help channel energy, money and time in a focused direction, thereby helping to assure
success. A good idea can be capitalized even more with the use of a business plan that
shows where money should go, and how long it will take before a business idea can be
profitable.

While the main purpose of a business plan is to help businesses move from start-up to
success, a business plan can also be indispensable as a tool for future development and
growth. Making the right decisions today can help to ensure the success of future
developments tomorrow; a business plan can help illuminate these opportunities and
move companies in the right direction.

A business plan portrays a formal seriousness that investors, employees, and others
involved in the development and growth of the business like to see. It means that

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 someone has taken the time to explain their plans and intentions for the business and its
future success. This vital step is a significant element that most start-ups fail to
recognize.

What Are the Attributes of a Good Planning Framework?

Characteristics of a Good Project Plan

There are many frameworks that can be used to produce a project plan but it is important to
remember that you should always tailor your plan to fit your project. Under-planning is a
common failure but over-planning can also be a problem in terms of unnecessary overheads
and wasted time.

A checklist to help you assess your plan:

Is the plan do-able?

When you look at it, do you feel comfortable that the plan is realistic or, deep down; do you
know it to be unrealistic? You have to be really honest with yourself on this one.

Is the plan in balance?

Following on from the first question, are the resources, timescales, scope and required
quality in balance? Can you say “Yes, I can deliver that scope, with those resources, in that
timescale to that quality level?” Don‟t be fooled by those triangle diagrams that show just
three elements as there are actually four to consider.

Does the plan fit the project?

Are you content that the plan is a good fit for the project? If it doesn‟t show enough detail to
control the project, then it will not function effectively. However, if the plan is in great and
unnecessary detail (perhaps following some site standard) then you have already wasted some
time, but will continue to waste more keeping the plan up to date unless you chop it down to

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size.

Are the deliverables clearly identified?

Many planning approaches focus on activity and there is a great pre-occupation about what is
done. But projects are really about delivery. Are your deliverables clearly identified and
specified? Activities should be identified once it is known what is to be delivered, rather than
deciding what is to be done and then trying to figure out what will be delivered!

Is the plan clear?

Is it easy to understand for all who will come into contact with it? That means Project Board
members as well as you and the Team Managers. If not, clarify it. It is unfair to ask a Project
Board to commit to a plan that they barely understand, and if they do commit, it will almost
certainly lead to problems later.

Is contingency included?
Something is going to happen that you haven‟t thought of, so contingency must be in the plan.
The amount of contingency will depend on the risk of the project, your experience and a range of
other factors. Try to establish an open relationship with the Project Board so that contingency is
clearly on the plan, not hidden away in inflated estimates.

Is the scope clear and agreed?

Scope creep is a major cause of project difficulty. Make sure that the scope is absolutely
clear. It can be very helpful in many cases to list what the project will NOT cover, as well as
what it will cover. This helps manage expectations. If an additional scope is required during
the project, then change control becomes easier because it is apparent that the plan does not
currently cater for the element, and extra time and resource will be required if the change is
to be accepted.

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 Steps in Planning

Planning means to look ahead and chalk out future courses of action that is to be followed. It
is a preparatory step. It is a systematic activity which determines when, how and who is going
to perform a specific job. Planning is a detailed program regarding future courses of action. It
is rightly said, “Well, the plan is half done”.
Therefore, planning takes into consideration available & prospective human and physical
resources of the organization so as to get effective co-ordination, contribution & perfect
adjustment. It is the basic management function which includes the formulation of one or
more detailed plans to achieve an optimum balance of needs or demands with the available
resources.

According to Urwick, “Planning is a mental predisposition to do things in an orderly way, to

think before acting and to act in the light of facts rather than guesses”.

Planning is deciding the best alternative among others to perform different managerial
functions in order to achieve predetermined goals.

Generally, planning involves the following steps.

Establish Goals

The first step of the management planning process is to identify specific company goals. This
portion of the planning process should include a detailed overview of each goal, including the
reason for its selection and the anticipated outcomes of goal-related projects. Where
possible, objectives should be described in quantitative or qualitative terms. An example of a
goal is to raise profits by 25 percent over a 12-month period.

Identify Resources

Each goal should have financial and human resources projections associated with its
completion. For example, a management plan may identify how many salespeople it will
require and how much it will cost to meet the goal of increasing sales by 25 percent.

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 Establish Goal-Related Tasks

Each goal should have tasks or projects associated with its achievement. For example, if a
goal is to raise profits by 25 percent, a manager will need to outline the tasks required to
meet that objective. Examples of tasks might include increasing the sales staff or developing
advanced sales training techniques.

Prioritize Goals and Tasks

Prioritizing goals and tasks is about ordering objectives in terms of their importance. The
tasks deemed most important will theoretically be approached and completed first. The
prioritizing process may also reflect steps necessary for completing a task or achieving a goal.
For example, if a goal is to increase sales by 25 percent and an associated task is to increase
sales staff, the company will need to complete the steps toward achieving that objective in
chronological order.

Establish Evaluation Methods

A management planning process should include a strategy for evaluating the progress toward
goal completion throughout an established time period. One way to do this is through
requesting a monthly progress report from department heads.

Identify Alternative Courses of Action

Even the best-laid plans can sometimes be thrown off track by unanticipated events. A
management plan should include a contingency plan if certain aspects of the master plan
prove to be unattainable. Alternative courses of action can be incorporated into each
segment of the planning process, or for the plan in its entirety.

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 These three approaches to business planning can be further categorized as follows:
Strategic Business Operational

Level Business-wide Business unit Functional area

Focus Direction and strategy Direction and Resources and action

for whole business strategy for the for functional area
business unit
Nature Broad and general More detail on Specific to the
goals and tasks function
Time Long-term 1-2 years Up to one year
horizon 3+ years

How to plan/make a project plan

Making an effective project scheme might look like an overwhelming job. In practice,
however, it is a direct procedure. It is built with a logical examination of what is required to
get the desired outcome, on time and below budget.

Here is a six-step approach to creating a project plan. It provides a roadmap for project
managers to follow and acts as the project manager's premier communications and control
tool throughout the project.

Step 1: Explain the project plan to key stakeholders and discuss its key components

"Project plan" is one of the most misunderstood terms in project management. It is a set of
living documents that can be expected to change over the life of the project. Like a road
map, it provides the direction for the project.

And like the traveler, the project manager needs to set the course for the project. Just as a
driver may encounter road works or new routes to the final destination, the project manager
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may need to correct the project course.

A common misconception is that the plan equates to the project timeline - that is only one of
the components of the plan. The project plan is the major work product from the entire
planning process, so it contains all the planning documents.

For example, a project plan for constructing a new office building needs to include not only
the specifications for the building, the budget, and the schedule but also the risks, quality
metrics, environmental impact, etc.

Components of the project plan include:

Baselines: These are sometimes called performance measures because the performance
of the entire project is measured against them. They are the project's three approved
starting points for scope, schedule and cost. These are used to determine whether or not
the project is on track during execution

Baseline management plans: These include documentation about how variances will be
handled throughout the project

 Other work products from the planning process, which include plans for risk management,
quality, procurement, staffing and communications

Step 2: Define roles and responsibilities

Identifying stakeholders - those who have a vested interest in either the project or its
outcome - is challenging and especially difficult on large, risky, high-impact projects. There
are likely to be conflicting agendas and requirements among stakeholders, as well as different
slants on who needs to be included.

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Step 3: Develop a scope statement

The scope statement is arguably the most important document in the project plan. It is used
to get common agreement among the stakeholders about the project definition.

It is the basis for getting the buy-in and agreement between the sponsor and other
stakeholders and decreases the chances of miscommunication.

This document will most likely grow and change with the life of the project. The scope
statement should include:

Business need and business problem

Project objectives, stating what will occur within the project to solve the
business problem
Benefits of completing the project, as well as the project justification

Project scope, stated as which deliverables will be included or excluded from the
project
Key milestones, the approach and other components as dictated by the size and
nature of the project

It can be treated like a contract between the project manager and sponsor - one that can
only be changed with sponsor approval.

Step 4: Develop the project baselines

Scope baseline, once the deliverables are confirmed in the scope statement, they need to be
developed into a work breakdown structure of all the deliverables in the project.

The scope baseline includes all the deliverables produced on the project and therefore
identifies all the work to be done. These deliverables should be inclusive. Building an office
building, for example, would include a variety of deliverables related to the building itself, as
well as such things as impact studies, recommendations, landscaping plans, etc.

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 Schedule and cost baselines

Identify the activities and tasks needed to produce each of the deliverables
identified in the scope baseline. How detailed the task list needs to be depend on
many factors, including the experience of the team, project risk, and uncertainties,
an ambiguity of specifications, amount of buy-in expected, etc.
Identify resources for each task, if known
Estimate how many hours it will take to complete each task
Estimate cost of each task, using an average hourly rate for each resource

Consider resource constraints, or how much time each resource can

realistically devote to this one project
Determine which tasks are dependent on other tasks, and develop a critical path
Develop a schedule, which puts all tasks and estimates in a calendar. It shows by
chosen time period (week, month, quarter or year) which resource is doing which
tasks, how much time each task is expected to take, and when each task is scheduled
to begin and end
Develop the cost baseline, which is a time-phased budget, or cost-by-time period
This process is not a one-time effort. Throughout the project, you will most likely
be adding to and repeating some or all of these steps.

Step 5: Create baseline management plans

Once the scope, schedule and cost baselines have been established, create the steps the
team will take to manage variances to these plans.

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All these management plans usually include a review and approval process for modifying the
baselines. Different approval levels are usually needed for different types of changes.

Not all new requests will result in changes to the scope, schedule or budget, but a process is
needed to study all new requests to determine their impact on the project.

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Step 6: Communicate
One important aspect of the project plan is the communications plan. This document states
such things as:

Who wants which reports, how often, in what format and using what media
How issues will be escalated and when
Where project information will be stored and who can access it
What new risks have surfaced and what the risk response will include
What metrics will be used to ensure a quality product is built
What reserves have been used for which uncertainties

Once the project plan is complete, it is important that its contents be delivered to key
stakeholders. This communication should include such things as:
Review and approval of the project plan
Process for changing the contents of the plan

Next steps - executing and controlling the project plan and key stakeholder
roles/responsibilities

Case study

This report describes how a wānanga, a polytechnic, two private training establishments and
an industry training organization teach literacy, language and numeracy skills as part of their
programmers.

Author(s): Linda Leach, Nick Zepke, Penny Haworth and Peter Isaa

4. Institute of Technology and Polytechnic case study

Experiences of embedding LLN

Linda Leach

4.1 Introduction

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This case explored the organizational factors affecting the delivery of embedded LLN in an
Institute of Technology and Polytechnic (ITP). The case study ITP is located in a North Island
city. It offers a wide variety of courses, from certificate to degree level, that focus on
vocational outcomes. It offers face-to-face and online modes, part- and full-time courses. It
also has a recognized regional facilitation role.

In the organizational structure, LLN delivery is the responsibility of the Academic Director.
Recent changes have resulted in several people and groups now reporting to him: a
Foundation Learning Review Team; a Literacy and Numeracy Steering Group (replacing the
former FLQA Group), which is responsible for embedding; the Literacy and Numeracy Co-
coordinator; the Language, Literacy and Numeracy Advisor; the Flexible Learning Facilitator;
and the Staff Development Advisor. Interest in embedded literacy began in 2007, with three
people attending regional clusters. Developments have accelerated through 2009. LLN
provision has focused on programmes at levels 1-3, although tutors teaching above these
levels have expressed an interest in learning more. From 2010 the ITP will address embedding
at all levels.

For this case study, three individual interviews were conducted with managers and two with
tutors; three focus groups involved a total of 10 tutors. In this section, the findings from the
data analysis are presented under the three headings: Governance and Management,
Pedagogy, and Professional Development. Governance and management have been combined
to better fit the data from the case. When quotations are used they are a reference to the
interview or focus groups and page, for example, P3:1, P4:2.
4.2 Governance and management

At this ITP, organizational change for embedded literacy has been driven from within the
organization. The vision, strategic planning, policy setting and monitoring have been led by
organizational staff. The changes have, however, been supported by the governing body.
Evidence for this is provided in approved institutional documents. For example, Investing in a
Plan includes a key performance indicator related to increasing foundation-level skills of
students in level 1-3 programs and the ITP applied for Capability Development Funding in

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2008. In its application it identified a key goal to “include literacy and numeracy embedding
in (its) core business at organizational level” (p. 3). Partnerships with other regional providers
and Industry Training Organizations (ITOs) are encouraged and fostered.

The vision to embed literacy and numeracy at the ITP was initiated by staff members. One
had good knowledge of adult literacy, was networking closely with colleagues nationally, was
informed about research, had completed the National Certificate in Adult Literacy Education
(NCALE) and became aware of the direction the TEC was beginning to take: “All foundation
tutors at polytechnics were obviously going to be targeted as people to deliver the literacy
and numeracy in their pre-existing courses” (P3:1). It took time to accept the new direction
but, together with the “very astute” line manager, who saw that “this is something we are
not going to have an option about” (P3:5), a case was made to management. They “have been
on board … our CE and our Academic Director have been right there from the beginning and
it‟s been fantastic” (P3:2). While the rationale presented to management included accessing
the funding and support available from TEC – “the carrot there is money” (P3:2) ‒ it was also
based on a belief that embedded literacy “had the underpinning of sound research” (P3:3)
and a realization that “20 of our staff and five managers are going to get rich staff
development” (P3:7). Management support was crucial because “selling an idea has got to

trickle down from the top” (P3:5). 23

There is a sense in the ITP that there was no real choice; they had to embed. “I don‟t think
there was any choice given to us” (P1:5); “A huge emphasis has been put on it from TEC”
(P2:1); “TEC requires us all to understand and accept that embedding literacy and numeracy
in all foundation programs is a reality – we have no option” (Literacy and numeracy
2
embedding overview, p. 1). This has resulted in LLN developments that align closely with
TEC expectations. An example is the case of language. Initially, language was included in
developments but this was refocused to literacy and numeracy when TEC took the emphasis
off language:
“We were starting to develop something about Te Reo, but when we realized that wasn‟t
going to be a compulsory thing it went away” (P1:4). However, once committed to the

23
organizational change approach promoted by the government through TEC and evident in the
literature (Skills for Life Development Centre, 2006), the Institute engaged in strategic
planning and policy development, with a focus on certificate courses from levels 1-3. This
resulted in significant change. A person puts it as: “The Institution has gone from sod all and
a bit of one-to-one literacy support to all of a sudden involving the whole of the Institution.
It‟s pretty exciting but it‟s a big undertaking” (P5:1). Another said: “This is a very good
organization strategy that has been well supported” (P4:10).

Literacy and numeracy embedding appeared in Investing in a Plan 2008 and the Foundation
Learning Strategic Plan 2008; a Literacy and Numeracy Steering Group was established and
linked to the Foundation Learning Quality Assurance (FLQA) Working Group; a new Literacy
and Numeracy Policy replaced the Foundation Learning Policy in February 2009 and a Flexible
Learning Policy was developed; Literacy and Numeracy Capability Funding was approved for
2009, providing essential resources in a smaller institution; two positions (Literacy and
Numeracy Coordinator and Language, Literacy, and Numeracy Advisor) were created and
appointments made in April 2009. A commitment to professional development saw three staff
attend the initial regional clusters, then 25 attend the TEC literacy and numeracy clusters in
2008 and 2009. Structurally, the new literacy positions and the Steering Group report to the
Academic Director. They work in a Staff Development Team that includes the Staff
Development Advisor and Flexible Learning Facilitator, thus providing valuable linkages.
Further linkages are created by Academic Advisors. Located in each department they work
alongside tutors while collaborating with the literacy specialists: “They are very much the
champions of policy” (P5:12).

Operational planning for LLN embedding has focused on the capability development action
plan. Programs to be targeted for LLN embedding from 2009 to 2011 have been identified and
plans to implement embedding have been developed and approved. These include: program
reviews to ensure LLN outcomes are explicit; mapping LLN components to the progressions;
diagnostic assessment; use of appropriate resources and deliberate acts of LLN teaching;
rewriting and development of course materials as appropriate; providing staff development;

24
and supporting staff to complete qualifications such as the National Certificate in Adult
Literacy Education (NCALE). Plans are in place for 2009-2011.

Embedding is being led by a group of people whose vision initiated the process and people
who have now been appointed to positions with the responsibility to lead development. Staff
at the institution recognize the leadership role key people have played, including one seen as
the champion: “People see her as a natural champion and that helps with the process” (P1:5);
“It is personality driven. If we‟ve got someone like [name] to do it, it‟s brilliant” (P2:14);
“They are such lovely people to work with and they believe in what they are doing. They are
experts in their field and have a wonderful way of working with people, drawing them in and
getting them involved” (P4:2). Commitment to embedding has also created a sense that it is
being driven. For example, purposes one and two in the Literacy and Numeracy Coordinator
job description begin “Drive institute-wide”; the Literacy and Numeracy Capability
Development Funding proposal (p. 3) identifies key, drivers‟ as the Tertiary Education
Strategy and the Key Performance Indicators, and one participant said, “There are two … on
the ground now to drive this project and I think driving is what is going to be required”
(P3:1). In spite of this there is a view that embedding is at an early stage: “Embryonic in
development” (P1:1); “It‟s still
in its infancy” (P2:1); and that change has been slow: “It‟s a very slow, slow progress” (P2:1);
deliberately slow: “We have been trying to implement it slowly … we are not pushing” (P1:1);
while “Making sure the momentum continues” (P4:6). While take-up by staff does vary: “We have
got the early adopters that are positive … but we have also got pockets of absolute resistance”
(P1:1) there has also been a lot of interest: “We also talked about a trickle starting off then we
had a literacy and numeracy tsunami on our hands … the take-up has been amazing” (P3:8).

Learning cultures for staff are being crafted in a variety of ways. Being part of literacy and
numeracy clusters has “brought people together for the first time … we are viewing ourselves
as cross discipline teams … for the first time people are seeing this huge cohort of
cooperation” (FG1:3); “It‟s had a uniting effect on the tutorial staff across departments
where you would usually be polarized and isolated” (FG3:4). Team teaching “worked really

25
well in the classroom” (P4:4); specialists are seen as “that team of support” (P2:14) and
individuals are working together in partnerships and teams. Support for staff is most evident
in a release to attend professional development clusters, the development of personal plans
to monitor workload and the provision of literacy/numeracy specialists within the Institute.
The availability of a Flexible Learning Facilitator to assist with embedded literacy and
numeracy is a support that is not yet well used: “People‟s lives are just so busy and it‟s just
another thing they don‟t have time for” (FG1:7).

Time emerged as the major issue facing staff: “The biggest problem we face is time. People
have time allocated to do it [attend clusters] but often other responsibilities and duties
encroach” (P4:6); “There are so many other things a tutor has to grapple with. … I can see
our tutors … just „what am I doing with the students at nine o‟clock? ‟ let alone, how am I
embedding literacy?” (P5:2); “People are time poor… our poor tutors are stretched in a
million different ways” (P4:3); “If you are really taking care of your students it‟s hard to find
time for other things” (FG2:3); “Wouldn‟t 48 hours in a day be wonderful?” (FG2:8). A second
issue concerned getting cover for teaching release. While the funding was available and
appreciated, it was not always possible to get a replacement tutor:

They have a highly specialized teaching area; they haven’t got people lined up behind them
ready to step in, so the handover, at the times it has to be [to fit the clusters], is just
impossible. So he hasn’t been able to make good on the funding that is available. (FG2:3)

I can say I was given 100 hours within my workload plan to enable me to do this (attend
clusters) and we managed to find someone who could come to the first term, but for the
second term, she is not able to come in so I’m going to have to miss some … you need to be
there for the whole thing. (FG3:2)

Let’s take welding tutors. You can’t just pull in some welder for two hours a week … freeing
up tutors does become an issue. (P5:6)

The third concern was that the TEC funding the Institution relies on to facilitate embedding
may disappear:

26
I’ve seen this before with projects that come from the Ministry … they give us ...money and we
do it for two years and then it dies … so with the literacy, I suspected it would be the same.
(P4:4)

4.3 Pedagogy
At an institutional level, pedagogy has been supported by the development of relevant policies
and quality assurance processes: “We‟ve recently reviewed all of our course development policies
and documents … as we have been aware of what‟s coming, so we have already implemented it
within all our guidelines for developing courses” (P1:10). At the programme level, pedagogy was
thought about in different ways. Participants talked about one-to-one literacy support, team
teaching by a vocational tutor and literacy specialist, and the version of embedded literacy being
promoted by TEC– the vocational tutor learning to identify and teach the literacy and numeracy
skills in their course content. Some felt there was still a place for one-to-one provision: “We are
meeting the needs that embedding can‟t do because it isn‟t dealing with the one-to-one issue”
(FG2:2). Some thought different literacy needs require different approaches:

We classify a learner as “can”, “can do with help‟, “can’t‟. The “can do with help‟, I firmly
believe will blossom with the tutor providing embedded literacy and numeracy … but
certainly the high needs people … that is not the job of a vocational tutor. A vocational tutor
can’t do specialist work. (FG2:7)

Some thought that a variety of pedagogies was desirable: “The more ways you have available
the better I would think. I would not support one initiative because you may only capture one
group of students … you have to come at it from different perspectives” (P4:11). Some valued
team teaching and wanted it to continue but again noted funding issues: “Yes, team teaching
happened here last year, but we have moved on from that as TEC don‟t really want to fund
that anymore” (P2:2); “I would like to see more team teaching” (P2:3). The government
approach to embedded literacy also had its advocates:

27
I’ve never liked the concept of literacy programmes. Four hours a week and learn to read.
I’ve always thought that was crap. … I’ve never liked the concept of the introduction to
literacy studies. If you really seriously want to improve the literacy in somebody who wants
to be a photographer, put him in a photography course and put the literacy and learning
skills in there and I can assure you, if they have the ability, they will have the best chance of
learning. So it’s a great concept – bring it on! (P5:16)

Some realized embedding had been occurring in the ITP prior to the recent initiative: “She
didn‟t realize herself … that she was doing this embedding and so we had it started” (P1:4);
“In some ways embedding literacy and numeracy has been going on without our kind of
knowing” (FG3:5). There is a clear intention in the Literacy and Numeracy Policy that the LLN
requirements will be identified: “Delivery materials… will be mapped to ensure that the
literacy and numeracy demands of courses are identified” (4.1). For some tutors, pedagogy
emerged at the lesson level: “It‟s about pulling the lesson plans apart; we can add in literacy
and numeracy… that is the biggest thing” (FG1:5).

A few felt their pedagogy was under pressure:

Teaching unit standards when we have had our class contact hours cut. … We are being
measured on outcomes such as retention and completion. … I have to shoot for the goal and
that is to prepare them for the assessments … as much as I would like them to get the
numeracy, get the literacy and certainly embed it in our resources and our assessment …
we’ve had to cut out all these nice frilly things. I absolutely agree with you … we’re teaching
the same content in a lot fewer hours and big classes. (FG3:6)

Others saw embedding could be achieved in: “Small steps… he does some pre-reading
activities, introducing the vocabulary… alerting them to keywords… small, small steps that
become part of their routine and they do it automatically and in minutes not hours” (FG2:15).

The amount of assessment with unit standards was referred to as a complicating factor in LLN
embedding, particularly in relation to the progressions: “They are already writing and dealing
with assessments, 240 of them, so to overlay the complexity of progressions around

28
someone‟s literacy and numeracy development, nah… they [teachers] might go and hang
themselves” (FG2:5). However, an assessment was most often spoken about as diagnostic
assessment:

We stopped immediately and redirected them to the Introduction of Tertiary Studies,

because we don’t want to see students fail. It’s not good for their self-confidence and their
future achievement and so it is better that they go down in the courses and succeed at that level
and then slowly build up. You want to be kind to them but realistic as well. (FG3:7)

I think we could be a lot more proactive if we had a test of some sort… which is linked to the
progressions we have been working on and if you could find out where the chinks are in the
students‟ knowledge then you could hone in… or if it is critical then we have to redirect
them elsewhere where they get specific help to continue on the course… it would be fairer
to the student and would help us, because, much as we would like to, the time situation is a
problem. (FG3: 8-9)

One manager was aware of the potential for diagnostic assessment to be used as a deficit
approach (Crowther et al., 2003; Tett & Maclachlan, 2008) and to cut across principles of
embedded LLN:

As long as alongside that screening questionnaire staff are looking at their program and
saying, “Well, there is an issue with the textbook; it’s not just the student. How else could
we embed literacy and numeracy concepts in our teaching?” So they are looking at what they
can do and not just saying, “Well, toss the student away.” (P4:9-10)

The Literacy and Numeracy Policy also suggests that a deficit approach could be avoided:
“Students who do not meet the academic entry criteria requirements will undertake a pre-
entry assessment task (literacy and numeracy) to enable them to enter the program of study
or be referred to an alternative program” (4.3, emphasis added). There was a concern that an
assessment based on the progressions could be overwhelming for tutors:

When tutors could see that 10 students had a weakness here and five had a weakness there …

29
they would struggle to know what to do with it. … It will be like “What the hell do I do?”
(FG2: 15)

Teaching in the Institution is clearly focused on students. A statement in the institutional

document, „A guide to effective teaching and learning’ states: “Our students (learners) are
the reason we exist. They deserve to get the best teaching and learning opportunities that we
can give them.” (p. 3). Staff also commented: “It‟s about the students as well. It‟s only going
to benefit them” (FG1:13); “I don‟t know of anyone who isn‟t here to support their students”
(P1:4). They work to improve student outcomes: “The better you get at putting [ideas] across
and the more variety [of methods] then it‟s going to benefit the students” (FG3:5); “Our
success rate in exams went up 100% and students that we knew never ever had the capability
of passing exams, with that help and support [team teaching], we‟re getting through” (P4:4).
Outcomes were understood as more than hard outcomes, for example as soft outcomes and
value added:

We have even gone a little bit further than that and have developed a chart for monitoring
soft outcomes. … So if we ever get into a situation where we are talking about completion,
retention and we are looking at value-added, we have actually got some evidence behind it.
(P1:11-12)

Adult education principles are integrated into the good teaching practices espoused in A
guide to effective teaching and learning and an awareness of them was evident in some
comments: “They might be fantastic tradespeople but they are new to teaching adults”
(P5:2); “There is a need I am seeing with the embedding that they are more about staff
development teaching adults” (P5:16). Several phrases about pedagogy recurred throughout
the interviews. Embedding literacy was seen as
“Good teaching” involving “deliberate acts of teaching” in a way that was “built in not bolted
on” (Millar & Falk, 2002; Wickert & McGuirk, 2005). “In the cluster groups I just recognized
good teaching strategies, learning strategies rather than teaching, good learning strategies”
(P5:5):

30
The thing with embedding literacy is that it’s not a whole lot of extra work, just good
teaching practice … it’s a matter of slotting in five or 10 minutes somewhere to make sure
the students have understood, which good teaching practice is. (FG1:3)

There are also efforts to link embedded LLN pedagogy with flexible learning through the
appointment of a Flexible Learning Facilitator, resulting in a growing awareness among
tutors:

I used to pooh-pooh it. I used to say, “No you can’t do e-learning with foundation students,”
until I realized e-learning isn’t at all distance learning. It can be classroom based where
students work individually and I found that a really good way to help. (P2:3)
Most staff seemed to be aware of the progressions and referred to them as part of LLN
embedding: “One of the progressions in reading is the critical reading” (FG2:12); “They will
do an online assessment to see where they would sit on the progressions” (FG1:9); “Because I
have experience of the progressions I was able to make sure that we were covering the
progressions” (P2:5). Some saw some potential issues for staff: “I think for them [tutors] to
cope in their busy worlds with the detail of progressions and the different categories are a
complexity I don‟t see them managing” (FG2:14).
There were different views on whether embedded LLN was functional or critical (Maclachlan
& Cloonan, 2003), focusing on the development of human capital (Reio et al., 2005) or social
capital outcomes (St. Clair, 2008) at this ITP. Some thought the focus was functional:

A critical aspect of the politics of literacy and things like that is just alien speak for those
people [level 2] and it’s not needed. They actually need informational stuff to help them get
skills and knowledge that help them do something pragmatic. (FG2:12)

It is nearly all functional. … I think it [critical literacy] would blow the mind of half the
vocational tutors. (P2:13)

Others thought there was a place for critical literacy:

Many people would argue that you could teach critical reading from the initial introduction

31
to reading. … I do not believe you have to be at a certain maturational level to be a critical
person and understand how people are positioning you against themselves. (FG2:12)

Some saw a progression across program levels:

Levels 1-3 I suspect it will be functional … but really, at the end of it [degrees], you want to
produce a graduate who is a critical consumer of knowledge and information … they
[students] are really meant to be going out there and being able to do a job, and hopefully,
to think on top of that job. (P1:13-14)

One reflected views in the more recent literature that the functional/critical divide is too
simplistic (McCaffery et al., 2007):

I don’t see … much of a division between the two. … I like to look at the whole person. … I
am really behind people being employable and being able to go through a promotion within
their workplace … embedding literacy is good for that because I think it gives grounding not
only in your vocational field and your course-specific literacy and numeracy but it’s going to
enlarge your views as a person as well.
(P3:14)

4.4 Professional development

The need for adequate professional development is highlighted in the literature (Askov et al.,
2003; Tett & Maclachlan, 2008; Wickert & McGuirk, 2005) and evident in the ITP data. There
is a commitment to professional development for LLN embedding at the organizational level:
purpose 5 in the Capability Funding Development Proposal highlights professional
development and identifies specific goals and actions relating to providing staff development
opportunities, releasing tutors to attend them and supporting tutors to complete the National
Certificates in Adult Literacy Education (NCALE) (Educator) and (Vocational). Information on
LLN embedding is to be included in staff induction (Capability Funding Development Proposal)
and foundation learning courses will be developed and delivered by staff who have completed
the appropriate induction and training (Literacy and Numeracy Policy 4.4). A Staff
Development Advisor was appointed in July 2009 and the job descriptions for the Literacy and

32
Numeracy Coordinator and Language, Literacy and Numeracy Advisor, both appointed in April
2009, include the provision of training for staff, development of resources and collaboration
with the Staff Development Advisor. The ITP plans to offer LLN clusters, modeled on the TEC
ones, from 2010. This organizational commitment is especially important given that “staff
development was a big black hole here … it wasn‟t even running a CAT [Certificate in Adult
Teaching] course so there was nothing happening for our tutors” (P3:6-7) and that “staff
development hasn‟t been on the radar for a while, so there is a hunger and a thirst for staff
to learn more” (P4:3). It also demonstrates the importance of the professional development
opportunities available through the TEC literacy and numeracy clusters.

Professional development has focused on these TEC clusters: three tutors completed the
regional clusters; 25 completed the literacy cluster in 2008, and 25 were engaged in the
numeracy cluster in 2009. Most staff has welcomed the opportunity for professional
development: “We were fearful that this was another thing on top of people. But we have
been genuinely surprised at how people have lapped it up” (P1:15); “It is some of the best
tutor development that has come out of the system for tertiary tutors – it‟s great” (P5:3);
“From the first day you could see the light bulbs going on all around the room. Like, „this is
not difficult, I can do this‟, and in actual fact, it is damned good professional development. I
used to love going and got a lot out of it” (P4:2); “For me, it‟s been very relevant, it gives
you a fresh approach” (FG3:11).

There were additional benefits from attending the cluster, most importantly the impact of
working together: “Bringing people together and owning those problems within their courses
and talking to each other and sharing experiences, whether they have experienced that in
business, in construction, in building, has been really valuable” (FG2:2); “I have valued even
more hearing how maths is being taught and applied in the different courses across campus”
(FG3:4). Many also referred to the awareness-raising effect of the clusters: “Awareness, it‟s
the realization of how much there is in the programme of literacy and numeracy” (FG1:10);
“The more I attended, the more I saw the kind of things they were talking about” (FG1:2); “It
really raised awareness and I think we used it to identify students with some literacy

33
problems that probably wouldn‟t have been identified without the clusters.” (FG3:2) The
success of the clusters also lay in the approach taken by the
presenters: “The people who run the sessions are so positive and are such good teachers that
it‟s fun, almost like I feel everyone would benefit” (FG3:4); “At the same time the presenters
are doing best practice teaching as well, so you get ideas from them” (FG3:5). One downside
of the clusters is the time they take: “The clusters are quite time-consuming” (FG1:5); “In
some weeks it was eight hours of meetings on top of what you already have, and there was no
time to do any work in those weeks and I thought it was outrageous” (FG2:17); and, for some,
the time they are scheduled: “The time schedules were really peak teaching times, so you
had this conflict of interest [be student centered or attend the clusters]” (FG3:2).
While the focus of professional development has been the clusters, in-house professional
development is now also available through the recently appointed advisors and other
qualifications are also supported by the ITP. One tutor is enrolled in the Master of Literacy
and Numeracy; one has completed the Master of Education (Adult Education); one has
completed the NCALE (Educator) and five are enrolled; and one has passed the NCALE
(Vocational) and two are enrolled. There were some different views on the NCALE: “I would
like to think that numbers of our tutors will do the NCALE” (P3:13); “For me the NCALE is a
piece of paper to keep the ivory tower people happy because I have a literacy qualification
but the … cluster work was actually far more useful and valuable for me” (P2:9).

Issues related to qualifications emerged. Some tutors, who already hold a professional
qualification and have a Certificate in Adult Teaching (CAT), now face being required to
complete the NCALE as well:

I can see that [NCALE] being fraught with difficulties … for us to start asking the automotive
tutor and everyone to now do another qualification, I can see that it’s not going to be well
received … so we may just have to be clever and try to repackage it so that people are
exiting or getting trained with both [CAT and NCALE] and then make that not as stiff a
hurdle as it currently looks like when separate. (P1:8-9)

I have the Level 5 NCAET [National Certificate in Adult Education and Training]. I have ticked

34
that box. I have done what I had to. And if they are going to give me another box to tick,
well. I did that because it was a job requirement and was free. But if you now say to me it’s
a job requirement and I’m going to have to pay something towards it, I don’t know if I’ll be
so inclined. (FG3:9)

Some reward structures are in place to recognize qualifications. A financial reward may be
given to staff who attended cluster meetings without a reduction in teaching hours
(Capability Development Funding Proposal). More importantly, the
NCALE would be considered in any career progression application: “Brownie points, yes,
informally … that would definitely be the brownie point in your portfolio”
(P3:13). Finally, some people identified a sensitive professional development issue that will
take careful handling and potentially has an important impact on successful
LLN embedding: “Some of the staff actually has literacy and numeracy issues, so to actually
expect them [to do qualifications] is quite a hard concept” (P1:9).

4.5 Conclusion

A number of organizational factors in embedded LLN provision emerge from the data in this
ITP. Many related to the findings in the literature review. They are summarized in the
following bullet points:

There is a whole-of-organization focus.

A champion has influenced organizational commitment to LLN.

Government funding and professional development have been major drivers, though
there is also a professional commitment to LLN provision.
Policies and procedures inform organizational direction and practice.
An organizational plan for developments to 2011 is in place.
There is a commitment to professional development.
Some partnerships with ITOs have been developed.
Staff appointments support LLN delivery.

35
 Teaching is student centered; LLN provision is student centered.
LLN provision is promoted as „good teaching‟, as „deliberate acts of teaching and as built
in not bolted on‟.
Partnership between flexible learning, staff development and LLN is fostered.

While aligning with the government-supported approach to embedded LLN, staffs

also understand that there is no single model of embedded provision.
The friendly approach of the „specialists‟ is a key factor in tutor take-up; these
people work well together and with tutors.
Opportunities exist for vocational and literacy specialists to work together.
While some focus on functional literacy, there is recognition of critical
literacy.

Footnotes

2. The internal ITP documents discussed in this section are not referenced fully to protect the
institution‟s anonymity.

Budgeting

A budget is a quantitative plan used as a tool for deciding which activities will be chosen for a
future time period. Budgeting is the process of preparing this budget.

In a business, the budgeting for operations will include the following:

- preparing estimates of future sales
- preparing estimates of future cash collections and disbursements
- preparing estimates of the future day-to-day activities of the organization
- summarizing these estimates into an income statement and balance sheet

A budget is a financial document used to project future income and expenses.

To put it simply, a budget plans future savings and spending as well as planned income and

36
expenses. Budgeting may be carried out by individuals or by a body to estimate whether or
not they can continue to operate with its projected income and expenses.

A budget can be drawn up for each financial year and contain information on the estimated
value of sales and value of costs. From this you can see how the coming accounting period is
likely to end. The actual performance of the business can be measured against this proposed
plan.

Different budgets can be created depending on what particular aspect of the business
requires focus. See three popular kinds of budgeting plans below.

Comprehensive Budget
A Comprehensive Budget, also known as a Master Budget, is a very detailed budget used when
you want to limit your spending. This type of budget is often used when you have a limited
income and you need to cut down on your expenses. A Comprehensive Budget keeps track of
your spending by creating a detailed list with categories for all your expenses, usually for a
month at a time.

Use this budget to cut back on your expenses by setting limits to the different categories on
your list. Determine the income you generate during the period of your list (i.e. if your list is
monthly use your monthly income) and use it to set strict limits for each category. By setting
strict limits to each category on your list you can track whether you are spending too much or
not on each category.

You can also use the Comprehensive Budget to review the way you spend money over time,
this is called an Overall Budget. The difference with this type of budget is the detail of the
categories and time period the budget spreads across. An Overall Budget has broader
categories and the time period is usually over a year instead of a month. This budget will
allow you to compare your general spending over the years.

37
 Problem Solving Budget 38

If you used the comprehensive budget and notice that you are having trouble controlling
money in a few areas, such as entertainment or beauty, a problem-solving budget may help to
address over spending in these areas. By creating a finely detailed list for these problem
areas (more detailed than the general categories for your comprehensive budget) you can
limit all the ways in which money is spent among these categories.

For example, if you have a category designated for clothing, you may want to finely detail the
category to include the type of clothing and for which member of the household it was for.
Later, review your expenditure on clothing and figure out how many of the items you bought
were needed or put to use. You may find that you are spending too much on certain items,
like shoes or bags. The problem-solving budget will help identify these problems in your
spending.

Planning Budget
If you are budgeting in order to save money for a something, such as a vacation or a new
home, a planning budget can help achieve your goal. The Planning Budget works by adding an
additional category to your budget that you designate for the goal you are trying to achieve.

To make this budget work, you must pay for your other expenses first. Once the rest of your
budget is met, you can take any left over money and add it to this extra category. This
category can be named as „Miscellaneous‟, and can even be used as an emergency fund. The
money added to this category is not spent; instead, it is saved until you reach the amount
needed for your goal.

Another variation of the Planning Budget is the Cost-Saving Budget. Unlike the Planning

38
Budget, the Cost-Saving Budget helps you increase your yearly savings instead of saving money
for a defined goal. To use this budget, make an additional category for savings or
emergencies. Next, look over your budget from year-to-year, looking for ways to lower your
overall expenses.

39
For example, instead of buying cheaper clothing, you may spend more up front for clothes
with quality fabrics. It may cost more, but in the long run it will help you save because the
clothes last longer, meaning you do not need to buy clothes more often. You can even try
stocking up on winter clothes in the summer or summer clothes in the winter because out of
season clothing is usually cheaper in price. Therefore, buying those when they are up for sale,
will definitely save some of your extra bucks.

Important things to know about budgets

A budget should be drawn up on the basis of three main factors:

A budget should always be based on proper plans, drawn up to ensure that you reach your
goals for that year. A budget should be the summary of all the costs and income to make
sure your plans are implemented.

The costs in the budget should be based on your financial statements of the previous year
and the budget items should compare the expenditure of the previous year to this year.
This will show that your budget is based on fact and experience.

The budget should be realistic and should also show what income you expect and
what income you would still need to raise.

Every budget should contain a number of categories. The two main categories are
"Expected Expenditure" and "Expected Income".

Under the Expected Expenditure the categories could be:

Capital costs - things that you have to buy like computers, cars etc.

Running costs - expenditure that will help your organization to run an office and

40
 administration to do its work: items like rent, electricity, telephone, purchasing/hiring of
material resources, etc.

Staff costs - salaries, staff benefits, staff training etc.

Project costs or Operational costs - costs that are linked to the specific projects or
campaigns that you plan to run that year. This would include things like buying materials,
printing costs, transport costs, workshop costs, catering, media production, venues,
sound systems etc.

Under the Expected Income of the organization you should include categories like:

Donor funds - list each funder and the amount you expect from them,

Membership fees - if your members pay fees, list the amount you expect to get this year,
Donations - list the amount you expect to get from small public donations

Fund-raising events - if you plan to organize events, list what profit you expect to make
and
Sales - if you sell your services or any products, keep note of the income

The budget should clearly show whether there is a difference between your Expected
Expenditure and your Expected Income. If you will get more money than you will spend, this
is called an expected surplus; if you will get less money it is called a deficit. When your
budget shows a deficit you will obviously need to either cut the budget or do some serious
fund-raising to make up the amount.

It is very important to write a budget in such a way that all amounts are justified and
explained. For example: if you want to spend Rs. 1, 00, 000 on salaries, you should explain
how many people will be employed for how much money. For example:

SALARIES 1, 00, 000

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1 coordinator @ Rs. 60, 000
per year

1 administrator @ Rs. 40, 000

per year.

The budget can be drawn up by anyone in the organization who is clear about the plans of the
organization as well as the possible income and expenditure. It is usually done by the
Treasurer, the Coordinator or Director or by a Budget/ Finance Committee. Whoever prepares
the budget must work together with others, especially people in charge of the programmers
of the organization and people responsible for book-keeping. Once the budget has been
prepared, it needs to be re-assessed and discussed by other members of your organization
such as executive or staff who will be utilizing the money.

Budgets are usually drawn up for one year but you can also draw it up for a few years at a
time, or have a budget that is just for a specific project that may only last a month or two. A
budget should be used as the basis for any audits that are done for your organization. Audits
are usually done by independent accountants who go through all your financial records to
check that the money was spent for what it was intended. A budget is used as the main tool
for judging the areas of your expenditure.

The budget is not simply a document for funders and executives to see whether you have used
the money properly. It should be a living tool for financial management. The budget is never
set in stone. Circumstances and the needs of your organization may change during the year
and a budget can also be changed if necessary. The overall budget of your organization is an
internal one, and it can be amended as per the situation.

A budget for a specific project that you send to a funder is not so easy to change, since you
have promised to do the work that is reflected in the budget and you only have a set amount

42
of money available to do this work. If you want to change a budget that has been approved by
a funder, you should only do that in consultation with, and with the permission of the funder.

Sometimes it is necessary to have two different budgets for your organization. One as the
ideal budget that you would like to have and a second one as a minimum budget of the money
that is absolutely necessary for your organization to survive. Often when your draw up the
ideal budget, you are quite unsure that you will get all the money you need and an estimated
budget will help you to decide which costs can be cut/reduced, if you are not able to manage
to raise the necessary funds.

Who should be involved in a budget process?

Different role-players are typically involved at different stages of the budget process:

Budget drafting or formulation stage takes place largely within the executive branch of the

state. This part of the process is usually managed and co-ordinated by a specific office –
typically the Budget Office in the Ministry of Finance. The drafting stage often involves
balancing the needs and proposals derived from various government departments against
the priorities set by political office-bearers and fiscal advisors.

The enactment of the budget gives the legislature the opportunity to debate and
ultimately approve the budget. This part of the process usually begins with the executive
formally proposing the budget to the legislature. The legislature then discusses the
budget, often including intensive work in legislative committees. In some countries, this
phase involves public hearings where members of civil society can give input on the
budget proposals. It is typically during the budget enactment stage that public attention

43
 on the budget is greatest and information about the budget is most broadly disseminated
by the media.

The third stage in the budget cycle involves the implementation of the budget and
monitoring of the expenditure. The key role-players during this stage therefore include
departmental officials and service-providers responsible for programme implementation.
Organization differ widely in how they regulate and where departments are more
independent, treasuries will monitor expenditures by requiring, for instance, regular
reporting by each department on its expenditure. In most countries, the executive issues
regular public reports on the status of expenditure during the year in different
programmers and sectors. In some cases, the treasury exercises pivotal control over
spending, reviewing allocations to departments and approving major expenditures.

During the final stage in the budget cycle, the budget is assessed and audited to see
whether the budget has been implemented as planned and whether funds have been used
appropriately. Ideally during this stage, the executive branch reports extensively on its
fiscal activities to the legislature and to the public. In addition, the implementation of
the budget is reviewed by an established, independent and professional body, such as an
Auditing Body or an Auditor General.

An Example of Project Management Budget

The following is an example of the typical expenses included in a project budget. To assist
you in your budgeting efforts, this sample budget can also be downloaded as a template in
Excel for a year-long project. Feel free to use it and modify it where needed.

44
PROJECT EXPENSES:

EMPLOYEE COMPENSATION:

Salary
Bonus & Commissions
Employee Incentive
Employee Benefits
Temporary Labor

Total Salary & Benefits

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OTHER EXPENSES:
Seminars & Training
Consulting Fees
Legal Fees
Other Professional Fees
Contracted Services
Recruitment
Advertising
Marketing Materials
Travel & Entertainment
Office Expense
Telephone
Computer Lease
Repairs & Maintenance
Utilities
Office Supplies
Dues & Subscriptions
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 Office Rent
Postage
General Insurance
Taxes & Licenses
Software Licenses

46
Other total Expenses/Total Budgeted Expenses

What is a balance sheet?

The balance sheet provides a good picture of the financial condition of a business and is a tool
used to evaluate a business's liquidity. It helps a small business owner identify trends and
quickly grasp the financial strengths and capabilities of their business.

The balance sheet is the financial statement used to report on the financial position of the
business to the owner and other stakeholders such as banks and investors. The balance sheet
is a statement of what a business owns (assets) and owes (liabilities), and the value of the
owner's equity (or net worth of the business) at a specific point in time. The balance sheet is
also known as a statement of financial position because it shows a summary of the business‟
financial position at a particular point of time.

The difference between the assets and liabilities is known as owner‟s equity. The balance
sheet is so named because the equity must equal assets minus liabilities.

Example Balance Sheet

ASSETS
Current Assets
Cash $ 20,000
Accounts receivable $ 15,000
Inventory $ 150,000
Total Current Assets $ 185,000

Non-Current Assets

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 Plant and equipment $ 50,000
Business premises $ 650,000
Vehicles $ 70,000
Total Non-Current Assets $ 770,000

TOTAL ASSETS $ 955,000

Current Liabilities
Accounts payable $ 25,000
Bank overdraft $ 10,000
Credit card debt $ 5,000
Tax liability $ 30,000
Total Current Liabilities $ 70,000

Non-Current Liabilities
Long term business loan 1 $ 450,000
Long term business loan 2 $ 50,000
Total Non-Current Liabilities $ 500,000

TOTAL LIABILITIES $ 570,000

NET ASSETS $ 385,000

OWNERS EQUITY $ 385,000

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What is Income Statement?

An income statement or profit and loss statement is one of business' main financial statements,
along with the balance sheet and cash flow statement.

Profit and loss statements, also known as income statements or statements of financial
performance, are a summary of the income and expenses of a business that determine the
profit made in a given time period. Profit and loss statements are usually performed
periodically, either annually, quarterly or monthly.
The profit and loss statement has a basic mathematical formula:

Income (Revenues Gains) - Expenses = Net profit

If income exceeds business expenses, the business

will have effectively made a profit. On the other
hand, if expenses exceed income, a loss would
have been incurred.

A profit and loss statement is a great tool for

identifying items of high expenditure or expenses
that were unproductive in producing profit. By
analyzing the profit and loss statement you can
better control business expenditure and thereby
potentially increase the profits.

The following table illustrates the structure of the income statement as well as some sample
account headings that go under each income statement classification:

Take note: Profit and loss account is the account whereby a trader determines the net result

49
of his business transactions. It is the account which reveals the net profit (or net loss) of the
trader.

The profit and loss account is opened with gross profit transferred from the trading account
(or with gross loss which will be debited to profit and loss account). After this all expenses
and losses (which have not been dealt in the trading account) are transferred to the debit side
of the profit and loss account. If there are any incomes or gains, these will be credited to the
profit and loss account. The excess of the gain over the losses is called the net profit and that
of the loss over the gain is called the net loss. The account is closed by transferring the net
profit or loss to the capital account of the trader.

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Format of the Profit and Loss Account:
Profit and Loss Account
For the year ended 2017
To Gross Loss xxxx By Gross Profit xxxx
To Salaries xxxx By Interest Received xxxx
To Rent xxxx By Discount Received xxxx
To Rent and Rates xxxx By Commission Received xxxx
To Discount Allowed xxxx By Other Receipts xxxx
To Commission Allowed xxxx By Etc., Etc. xxxx
To Insurance xxxx
To Bank Charges xxxx By Net Loss (transferred to xxxx
To Legal Charges xxxx capital account of the trader)
To Repairs xxxx

To Advertising xxxx
To Trade Expenses ex.
To Office Expenses xxxx
To Bad Debts xxxx
To Traveling Expenses xxxx
To Etc., Etc. xxxx

To Net Profit (transferred to

xxxx
capital account of the trader)

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 49
Statement of Cash Flows

A Statement of Cash Flows (or Cash Flow Statement) shows the movement in the Cash
account of a company. It presents cash inflows (cash receipts) and outflows (cash payments)
in the three activities of business: operating, investing and financing. Accountants follow
the accrual basis in measuring income and expenses. However, some users of accounting
information are particularly interested in the cash transactions of the company; hence the
need to present a Statement of Cash Flows. This lesson provides an overview of the Statement
of Cash Flows and some important points in understanding it. Since its preparation requires a
deeper understanding of accounting concepts, a separate post on how to prepare this report
will be available in later lessons.

Cash flow is determined by looking at three components by which cash enters and leaves a
company: Core Operations, Investing and Financing.

Operations

Measuring the cash inflows and outflows caused by core business operations, the operations
component of cash flow reflects how much cash is generated from a company's products or
services. Generally, changes made in cash, accounts receivable, depreciation, inventory and
accounts payable are reflected in cash from operations.

Investing

Changes in equipment, assets or investments relate to cash from investing. Usually cash
changes from investing are a "cash out" item, because cash is used to buy new equipment,
buildings or short-term assets such as marketable securities. However, when a company
divests of an asset, the transaction is considered "cash in" for calculating cash from investing.

52
Financing

Changes in debt, loans or dividends are accounted for in cash from financing. Changes in cash
from financing are "cash in" when capital is raised, and they're "cash out" when dividends are
paid. Thus, if a company issues a bond to the public, the company receives cash financing;
however, when interest is paid to bondholders, the company is reducing its cash flow.

Statement of Cash Flows Example

Here is a sample cash flow statement for Strauss Printing Services, our over-used service type
sole proprietorship business. All amounts are assumed and simplified for illustration purposes.

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 Statement of Cash Flows

For the Year Ended December 31, 2017

Cash Flow from Operating Activities:

Cash received from customers $ 146,000

Cash paid for expenses (81,000)

Cash paid to suppliers (47,500) $ 17,500

Cash Flow from Investing Activities:

Cash paid to acquire additional equipment (20,300)

Cash Flow from Financing Activities:

Cash received from investment of owner $ 10,000

Cash received from bank loan 50,000

Cash paid for bank loan – partial payment (27,000)

Cash paid to owner – withdrawal (20,000) 13,000

Net Increase (Decrease) in Cash for the Year $ 10,200

Add: Cash – January 1, 2012 10,800

Cash – December 31, 2012 $ 21,000

Statement of Retained Earnings

If your company earns a profit, you can choose to either distribute the profits as dividends to
owners or reinvest the profits in your business. The amount of profit you have kept since your
company‟s opening is called your retained earnings. Your statement of retained earnings
shows the change of your retained earnings account between two periods and the items that

54
affect the change. The more you grow your retained earnings, the more money you will have
to reinvest in your business, which reduces the need to use outside financing.

Given below are the steps for Statement of Retained Earnings:

Step 1

Determine from your accounting records your net income or net loss and the amount of
dividends you paid in the current accounting period. Determine the previous period‟s ending
retained earnings balance, which is the same as the current period‟s beginning retained
earnings balance. For example, assume you generated $10,000 in net income, paid $1,000 in
dividends and had a $50,000 retained earnings balance at the end of the previous period.

Step 2

Write “Beginning retained earnings” in the first column and its amount in the second column
on the first line of the statement of retained earnings. In this example, write “Beginning
retained earnings” in the first column and “$50,000” in the second.

Step 3
Write “Plus: Net income” in the first column and the amount of net income in the second
column on the second line. Alternatively, write “Less: Net loss” in the first column and the
amount of a net loss in the second column. In this example, write
“Plus: Net income” and “$10,000.”

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Step 4
Add net income to beginning retained earnings. Alternatively, subtract a net loss from
beginning retained earnings. Write either result in the second column of the third line. In this
example, add $10,000 to $50,000 to get $60,000. Write “$60,000” in the second column of
the third line.

Step 5

Write “Less: Dividends” in the first column and the amount of dividends in the second column
on the fourth line. In this example, write “Less: Dividends” and “$1,000.

Step 6

Subtract dividends from your Step 4 result to calculate the current period‟s ending retained
earnings. Write “Ending retained earnings” in the first column and the amount in the second
column on the fifth line of the statement. Continuing the example, subtract $1,000 from
$60,000 to get $59,000 in ending retained earnings. Write “Ending retained earnings” in the
first column and “$59,000” in the second column.

Marketing

Marketing Information System, abbreviated as MIS, means to collect, analyze and supply
marketing information to the marketing managers. The marketing managers use this
information to take marketing decisions. MIS is a permanent and continuous process.
Marketing information includes all facts, estimates, opinions, guidelines, policies and other
data. This information is necessary for taking marketing decisions. This information is
collected from both internal and external sources. It is collected from customers,
competitors, organization salesmen, government sources, specialized agencies, and so on.

56
MIS collects the marketing information from different sources. This information (data) is
analyzed. Then, it is supplied to the marketing managers. The marketing managers use this
information for taking marketing decisions. MIS also evaluates and stores the information. MIS
uses modern technology for collecting, analyzing, storing and supplying information.

Components of Marketing Information System

Internal Marketing or Accounting System

This component or source tells that organization should get all marketing related
information through this source. Organization makes the accounts of customers and
records the sales. After analyzing it through management accounting and cost accounting,
organization can obtain all useful information relating to past marketing data.

Marketing Intelligence

Organization can take the help of marketing intelligence for getting information of

57
 competitor activities.

Marketing Research

For improving the quality of product, organizations need marketing research information.
This information is given by marketing research team.

Marketing science
Marketing science means use of mathematics and quantitative techniques to solve
business and marketing problems.

Analyzing the various environment affecting the marketing structure

A market environment analysis is an analysis of both the external and internal environments
related to an organization. An economical tool for conducting a market environment analysis
is the Political, Economic, Socio-cultural and Technological (PEST) tool. This yardstick for
measuring a market environment looks at the various listed factors in a selected market with
a view to finding out how they relate to the business.

The first step in applying PEST to a market environment analysis is to conduct a study of the
political factors that may either have a positive or negative effect on the organization. An apt
example is the various codes and regulations imposed on different industrial sectors. This may
be seen in the construction educational sector, industrial sector where obligatory
administrative rules specify the means of operations. For example, in the United States, the
Occupational Safety and Health Administration (OSHA) makes the rules stating the proper
ways for various occupational sectors to operate.

Kenichi Ohmae, Japanese corporate strategist, developed the 3Cs model to study competitive
advantage. This alternate model is based on a popular philosophy prevalent among the
Japanese business class: Hito-Kane-Mono, which means people, money and things. The belief
58
is that when these three vital resources are in synergy (without waste or surplus), then only
corporate management can be streamlined effectively.

The focus of the three Cs model is on organization, customers and competitors.

The three factors are closely interlinked. They help digital marketers assess and tap into
opportunities that can create competitive advantage when drafting their marketing plan.

SITUATION ANALYSIS USING THE 3Cs MODEL

The 3Cs can be integrated into a strategic triangle as shown below.

Organization: Ohmae advises developing a digital marketing strategy that put goals ahead of
your competition
by channeling your brand‟s unique
strengths. In the context of a digital
marketing plan, this would mean
strategizing within the context of
your online business goals. And in
doing this, you will first need to
understand your present online

reputation and performance. You will also need to be aware of the attitude towards digital
marketing your business has maintained thus far. Convincing senior management about the
viability of your digital marketing plan is also important to get investments green-lighted.
Bring facts to the table, always have an answer to questions posed by management and avoid
surprises, for a successful management buy-in.

Customers: Your customers are key value drivers and integral parts of your digital marketing
strategy plan. In this “3C‟ you will focus on studying market and customer segments. For instance,
to compare marketing coverage versus marketing costs, you will need to understand the

59
preference for two primary modes of purchase – online and offline, as well as the marketing
distribution channels (mobile, website, other).

Your customer mix will influence your digital strategy to a large extent, and as a primary
objective, you will need to analyze target audience‟s preference towards digital platforms. As
your competitors will also be studying the market in the pretty much the same way, a
periodic market segmentation study is necessary to ensure the continued effectiveness of
your marketing strategy.

Competitors: Here, you will identify sources of differentiation in areas of sales, design,
purchasing and servicing. Study the strengths and weaknesses of competitors‟ online
strategies and measure their online performance against your own. Some of the important
factors you will need to analyze are web functionalities, online purchase experience and
online customer support.
Market segmentation can be defined as the process of breaking down the total market for a
product or service into distinct sub-groups or segments where each segment may conceivably
represent a separate target market to be reached with a distinctive marketing mix.
Segmentation and the subsequent strategies of targeting and positioning start by recognizing
that increasingly, within the total demand/market for a product, specific tastes, needs and
demand may differ. It breaks down the total market for a product or service into individual
clusters of customers, or segments. Here, customers who share similar demand preferences
are grouped together within each segment.

Effective segmentation is achieved when customers sharing similar patterns of demand are
grouped together and where each group or segment differs in the pattern of demand from
other segments in the market. In most markets, be it consumer or industrial, some kind of
segmentation can be accomplished on this basis.
Theoretically, the base(s) used for segmentation should lead to segments that are:

60
 Measurable/identifiable Here, the base(s) used should preferably lead to ease of
identification in terms of who is in each segment. It should also be capable of
measurement in terms of the potential customers in each segment.

Accessible Here, the base(s) used should ideally lead to the organization being able to
reach selected market targets with their individual marketing efforts.

Meaningful The base(s) used must lead to segments which have different preferences or
needs and show clear variations in market behaviour and response to individually designed
marketing mixes.

Substantial The base(s) used should lead to segments which are sufficiently large to be
economically and practically worthwhile serving as discrete market targets with a
distinctive marketing mix.

The process by which marketers make strategic decisions is referred to as target

marketing and which involves 4 basic steps:

IDENTIFYING MARKETS

Marketers identify the specific needs of groups of people, select one or more of these
segments as a target and develop marketing programs directed to each one.

MARKET SEGMENTATION

Dividing up a market into distinct groups that (1) have common needs and wants (2) will
respond similarly to a marketing action.

The bases of segmentation include the following:

Geographic segmentation.
Demographic segmentation.

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 Psychographic segmentation.
Behavioural segmentation.
Benefit segmentation.

SELECTING A TARGET MARKET 58

The segmentation analysis will reveal the market opportunities available. 2 steps are
involved next (1) determining how many segments to enter and (2) determining which
segments offer the most potential.

 DETERMINING HOW MANY SEGMENTS TO ENTER

There are usually 3 market coverage alternatives to consider.

Undifferentiated marketing – involves ignoring segment differences and offering just one
product or service to the entire market.
Differentiated marketing – involves marketing in a number of segments, developing
separate marketing strategies for each.
Concentrated marketing – used when the organization selects one segment and attempts
to capture a large share of this market.

POSITIONING

Positioning is identified as the art and science of fitting the product or service to one or more
segments of the broad market in such a way as to set it meaningfully apart from competition.

DEVELOPING A POSITIONING STRATEGY

There are a number of position strategies that companies may adapt. These include:
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 Positioning by service attributes and benefits.
Positioning by price/quality.
Positioning by use or application.
Positioning by product class.
Positioning by service user.
Positioning by competitor.
Positioning by cultural symbols.
Repositioning.

DETERMINE THE POSITIONING STRATEGY

There are 6 steps that break down the positioning strategy:

Identify competitors.
Assessing consumers‟ perceptions of competitors.
Determining competitors‟ positions.
Analyzing the consumers‟ preference.
Making the positioning decision.

The customer retention rate refers to the number of customers lost over a period of time. It
is normally calculated by the percentage of lost customers versus existing customers over a
quarterly, half yearly or annual period, without tallying new customer acquisitions.

While there are obvious benefits to keeping customers loyal and maintaining high customer
retention rates, it can be extremely challenging for management to keep retention rates up.
This guide will explore some of the best customer retention strategies, important topics and
common challenges related to customer retention:

63
 Understanding customer retention
Build a customer retention strategy
Implementation of a customer retention program
How to calculate retention rate?
Understanding customer retention

Ethical problems in marketing stem from conflicts and disagreements. Each party in a
marketing transaction brings a set of expectations regarding how the business relationship
will exist and how transactions should be conducted. Each facet of marketing has ethical
danger points as discussed below.

Market Research

Some ethical problems in market research are the invasion of privacy and stereotyping. The
latter occurs because any analysis of real populations needs to make approximations and
place individuals into groups. However, if conducted irresponsibly, stereotyping can lead to a
variety of ethically undesirable results.

Market Audience

Selective marketing is used to discourage demand from so-called undesirable market sectors
or disenfranchise them altogether. Examples of unethical market exclusion are past industry
attitudes to the gay, ethnic minority, and plus-size markets.

Pricing Ethics

Bid rigging is a form of fraud in which a commercial contract is promised to one party,
although for the sake of appearance several other parties also present a bid. Predatory
pricing is the practice of selling a product or service at a very low price, intending to drive
competitors out of the market, or create barriers for potential new competitors to enter the
market.

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Using Ethics as a Marketing Tactic

Major corporations fear the damage to their image associated with press revelations of
unethical practices. Marketers have been quick to perceive the market's preference for
ethical companies, often moving faster to take advantage of this shift in consumer taste. This
results in the propagation of ethics itself as a selling point or a component of a corporate
image.

Marketing ethics, regardless of the product offered or the market targeted, sets the
guidelines for which good marketing is practiced. To market ethically and effectively one
should be reminded that all marketing decisions and efforts are necessary to meet and suit
the needs of customers, suppliers, and business partners.

Services marketing is a sub field of marketing, which can be split into the two main areas of
goods marketing (which includes the marketing of fast moving consumer goods (FMCG) and
durables) and services marketing. Services marketing
typically refer to both businesses to consumer (B2C) and business to business (B2B) services,
and includes marketing of services like telecommunication services, financial services, all
types of hospitality services, car rental services, air travel, educational institution, health
care services and other professional services. The range of approaches and expressions of a
marketing idea is developed with the hope that it be effective in conveying the ideas to the
diverse population of people who receive it.
Services are economic activities offered by one party to another. Often time-based,
performances bring about desired results to recipients, objects, or other assets for which
purchasers have responsibility. In exchange for money, time, and effort, service customers
expect value from access to goods, labor, professional skills, facilities, networks, and
systems; but they do not normally take ownership of any of the physical elements involved in
it.

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Service Quality is an assessment of how well a delivered service conforms to
the client's expectations. Service business operators often assess the service
quality provided to their customers in order to improve their service, to
identify problems, and to better assess client satisfaction.

Determinants of Service Quality

Reliability: Reliability implies consistency of performance and dependability. Many of the

factors promoting reliability are common to overall success. We employ back up systems
and personnel to ensure that an adequate supply of workers are available to complete the
job.

Responsiveness: Responsiveness implies willingness and readiness to perform services.

Our managers, supervisors and all personnel are encouraged to work under a “spirit of
service”. We understand that our customer‟s would not need our service, if they never
had problems. We teach our personnel to understand and appreciate the term “job
security”.
Competence: Competence implies the possession of skills and knowledge to perform. Our
management team benefits from some of the most knowledgeable resources in the
business.
For instance: Our cleaning service is unsurpassed! We are confident that there is no
cleaning condition that we cannot manage!

Understanding: Understanding means knowing the customer's needs and requirements.

We know how to listen.

Communication: Communication means providing the customer with effective

information. We retrieve a huge amount of information from our operations‟ personnel.
We have a number of effective means for passing this information on to our customers.

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 Courtesy: Courtesy implies friendliness of personnel and ownership. We know how to
handle complaints. We strive to be “peacemakers not troublemakers”. We find answers to
your problems, not excuses.

Credibility: Credibility refers to the trust and personal characteristics of personnel. We

have experienced recruiters who ask pertinent questions, check references and conduct
background checks on all new hires.

Security: Security covers all the aspects of safety, financial security, and confidentiality.

Service Strategies can help you design your service processes from scratch or re-engineer
existing processes to take your organization to the next level of performance. We leverage
our expertise and experience to align your new processes with industry standards and best
practices, thereby ensuring your success.

Our Approach

Your processes and operating procedures will be examined to identify opportunities for
improvement that will enable the organization to deliver the most efficient service at the
right level of quality to customers. The process re-engineering projects typically include:

Complete review of all detailed processes

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Analysis and identification of failure points in current processes
Process redesign and creation of new process flows and descriptions
Alignment of new processes to industry standards and best practices
Determination of any systems impact and required enhancements
Analysis of resource requirements necessary to execute new processes
Change management training and roll out to the organization
Creation of measures of success and key performance indicators
Monitoring and tracking of performance to ensure success

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Service Strategies consultants stay engaged to monitor the organizational and process changes
and provide fine tuning and ongoing assistance to ensure continued success.

Operation Management

Operations management refers to the administration of business practices to create the

highest level of efficiency possible within an organization. Operations management is
concerned with converting materials and labor into goods and services as efficiently as
possible to maximize the profit of an organization.

Operations Management deals with the design and management of processes, services and
supply chains. It considers the acquisition, development, and utilization of resources that
organizations need to deliver the services their clients want. OM ranges from strategic to
tactical and operational levels. Representative strategic issues include determining the size
and location of manufacturing Organization, deciding the structure of service or
telecommunications networks, and designing technology

Tactical issues include organization‟s layout and structure, project management methods,
and equipment selection and replacement. Operational issues include organization‟s work
scheduling and control, inventory management, quality control and inspection, equipment
maintenance policies, etc.

The scope of operations management based on the interrelationship of three aspects,

namely:

Structural aspects, in the form of input will be transformed according to criteria of the

desired products, machinery, equipment, formulas and models.

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implementation, control, and improvements to obtain optimum performance, so that operations
can be run continuously.
the tendency that occurs outside the system, such as community,
government, technology, economics, political, social, cultural, and the demonstrated ability to
adapt.

Study of Operations Management

Operations Management is the set of activities that creates value in the form of goods and
services by transforming inputs into outputs.

Operations Management is one of the three major functions of any organization, and it is
generally related to all the other business functions. All organizations market (sell), finance
(account), and produce (operate), and it is important to know how the Operations
Management activity functions. Therefore, we study how people organize themselves for
productive enterprise.

• We study Operations Management because we want to know how services are produced.

• We study Operations Management to understand what operations managers do. By

understanding what these managers do, you can develop the skills necessary to become such
a manager. This will help you explore the numerous and lucrative career opportunities in
Operations Management.

• We study Operations Management because it is such a costly part of an organization. A large

percentage of the revenue of most firms is spent in the Operations Management function.
Indeed, Operations Management provides a major opportunity for an organization to improve

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its profitability and enhance its service to society.

What industries may benefit from improved operations management?

One service sector industry that can use improved operations today is Education & Training
services.

Even though there are some education facilities that offer online education, traditional
higher education institutions should aggressively begin investing time and effort on online
degree programs. Because student welfare is an essential issue to this service industry and
since operations management is consumer based, traditional facilities should be flexible
and consider technological innovations.

Traditional education institutions have “a common concern [that] when starting a distance
education program[,] the online course offerings will merely divert students from existing
traditional courses, dividing a fixed pool of students….[and] might lower a traditional
institution‟s academic profile”

Roles and Responsibilities of Operation Manager

The responsibilities of an operations manager involve the process of planning, designing, and
operating systems and sub-systems. Most managers have operations management
responsibilities; these include facility location, facility design and layout, quality assurance,
materials management and inventory control, scheduling, and maintenance planning. Some
major responsibilities are discussed below:

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 Policy Formulation

Formulating policy is one of the core duties of an operations manager. Companies must
operate and function on a daily basis within a prescribed set of guidelines. These
guidelines are generally established by operations managers. These can include how
different departments within the company or organization communicate and cooperate
with one another. Policies can also include disciplinary actions taken when employees
break company rules.

Planning
The planning of various company operations and activities is another major concern of the
operations manager. The operations manager also helps plan and coordinate activities
between various departments.

Controlling Resources
Controlling major company resources is yet a third major function of an operations
manager. Operations managers oversee the implementation of payroll policies and
procedures, how much employees are paid, how funds are allocated for benefits packages
and how other funds are spent to keep the company operating smoothly on a day-to-day
basis. Operations managers regularly review financial statements to ensure that the
company is operating as efficiently and as profitably as possible.

Communication

A final core responsibility of an operations manager is communicating with other management

professionals within the organization to keep the company running smoothly, and
communicating with other companies and organizations with which the company does
business. Operations managers are responsible for putting together reports and financial
statements that are essential for other top executives within the organization to function.

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Although the academic subjects of “organizational behavior” and “human resource
management‟ deal extensively with all issues concerning people in organizations, the design
of people‟s jobs is particularly important to operations managers. That is why we include this
topic within the text (most other textbooks in this area also do the same). The important
thing to understand about job design is that, more than any other subjects in operations
management, one can take very different perspectives on the task. For example, a traditional
work study practitioner would look at job design in a very different way to an ergonomist or a
specialist in team working. It is not that any of these perspectives are “wrong‟ as such; rather
they emphasize different aspects of job design. The reality of job design is that most of the
perspectives presented in this chapter will have to be used. So, for example, it is not
necessarily incompatible for an operations manager to use work study techniques to estimate
how long each element of the job will take to perform, whilst at the same time considering
the ergonomic aspects of how the working environment should be managed, and also deciding
on the relevant level of autonomy to design into a work team. While there are very different
principles implied in each of the approaches described in this chapter, they are not always
incompatible. We have chosen to describe each approach to job design in chronological order.
This is not because we are particularly interested in the history of job design, rather it is
important to understand how one approach either built on the foundations of previous
approaches, or, alternatively, reacted against previous assumptions.

The objectives of job design

There are clearly many alternative designs for any given job. For this reason, an
understanding of what the job design is supposed to achieve is particularly important. As
before, the five performance objectives give us a guide to what is relevant in job design
decisions.

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1. Quality

The ability of staff to produce high-quality products and services can be affected by job
design. This includes avoiding errors in the short term, but also includes designing jobs which
encourage staff to improve upon them in such a way as to make errors less likely.

2. Speed

Sometimes speed of response is the dominant objective to be achieved in job design. For
example, the way in which the jobs of emergency service personnel are organised (the range
of tasks for which they are trained, the sequence of activities in their approved procedures,
the autonomy which they have to decide on appropriate action, and so on) will go a long way
to determine their ability to respond promptly to emergencies and perhaps save lives.
3. Dependability

Dependable supply of goods and services is usually influenced, in some way, by job design.
For example, in the postal services‟ working arrangements, multi-skilling, accurate use of
sorting equipment through good staff-machine interface design, and the “design‟ of postal
staff‟s clothing, can all aid dependable delivery of letters and parcels.

4. Flexibility

Job design can affect the ability of the operation to change the nature of its activities. New
service flexibility, mix flexibility, volume flexibility and delivery flexibility are all dependent
to some extent on job design. For example, staffs who have been trained in several tasks
(multi-skilling) may find it easier to cope with a wide variety of models and new product or
service introductions.

5. Cost

All the elements of job design described above will have an effect on the productivity, and
therefore the cost, of the job. Productivity in this context means the ratio of output to input:
for example, the number of customers served per hour or the number of products made per
worker.
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In addition, job design will influence two other particularly important objectives.
6. Health and safety

Whatever else a job design achieves, it must not endanger the well-being of the person who
does the job, other staff of the operation, the customers who might be present in the
operation, or those who use any products made by the operation.
7. Quality of working life

The design of any job should take into account its effect on job security, intrinsic interest,
variety, opportunities for development, stress level and attitude of the person performing the
job.

Read the following Case Study for better understanding:

JIC In Brisbane - Japanese Language School "We

tripled our revenue in 5 months..." , Shannan
Murphy, Operations Manager
JIC in Brisbane

Background:

JIC In Brisbane is a private educational institute that sells short courses in Japanese-language
instruction. Their marketing challenges are typical of many small businesses:
1. A tightly-defined target market (people interested in becoming proficient in Japanese
language) that is nevertheless thinly-dispersed over a wide area.

2. A relatively high entry price for customers (language courses start at $400)

JIC In Brisbane had a couple of problems: Dwindling lead numbers and stagnant student
retention had translated into dropping revenue, with no obvious reason for the decrease.
Customer satisfaction seemed good, although staff were finding it hard to convince
prospects of the value of their offering. Marketing Results was approached with a number
of tasks:

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Objectives:
1. To increase student numbers and revenue

2. To understand the marketing processes at JIC better (strengths, weaknesses,

opportunities, threats
3. To systematize the sales and marketing process to reliably generate more
new student enquiries.

Processes used to achieve objectives:

1. Development of a marketing strategy: "To establish JIC as the hub of Japanese

language and culture in Brisbane."
2. Defining and measuring benchmarks: Tracking where sales leads are coming
from and the Return On Investment of each marketing method.
3. Improving the sales process: Rewriting the information pack for new students to sell
the courses more effectively. Standardizing the sales process and working as a team
to generate incremental improvements.
4. Analysing customer data: E.g. segmenting clients by entry level and other factors.
This revealed that beginner-level students have a 19% higher value per client than
other students. Developed strategies to target prospects in that higher-value segment.

5. Tactics to acquire new customers: This included targeted direct mail to 3 separate
in-house lists (existing students, previous students and previous enquirers); an active
customer referral program; an email newsletter; designed website as a sales and
community-building tool.
6. Standardizing the above to act as a staging point for future improvements. The above
steps were rolled out over 5 months, with high involvement by JIC In Brisbane staff,
who took responsibility for working with their new marketing systems.

Notes on Strategy:

JIC In Brisbane faced two main challenges: (1) A low number of leads (prospects) and (2) a

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low conversion rate of prospects to customers.

A long-term solution to these problems had to be found at a strategic level. We decided to

position JIC In Brisbane as the hub of Japanese language and culture in Brisbane, with more
customers and revenue a logical result of this strategy.

This involved providing prospects with free information and resources of interest to them
(e.g. information on Japanese-related events in Brisbane, job and travel information, free
language exchange events, reports and articles on how to study Japanese more effectively
etc.)

By implementing this strategy, they offered greater value to clients, generated goodwill and
established themselves as experts within their target market. The result is a much larger pool
of prospects, and a higher conversion rate from prospects to customers. Benefits have
compounded over the year as this strategy has slowly gathered momentum.

Results:

Revenue increased by 185% in 5 months. Current enrollments are steady at around

triple their former level.
"Autopilot" marketing systems that are less time consuming and produce consistent,
predictable results.

JIC in Brisbane Japanese Language School Operations Manager Presenter Shannan

Murphy says...
"We tripled our revenue in 5 months..."

Excerpts:
In October 2003, we asked Marketing Results to help us with some marketing challenges. We
were frustrated because although we had great confidence in our language courses, we just

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weren't able to get the message out to the right people on a budget. We were relying on
"walk-by" traffic for most of our business, and it just wasn't enough. We were also trying other
things such as flyers and newspaper ads, but with not much return.

So we started working with Marketing Results, and the figures speak for themselves: In only 5
months, our revenue jumped by 185%. Now, almost a year later, we continue to work
together to maintain these results and work on new projects. Whereas before we sometimes
had empty classrooms, now our courses are full to capacity and my job is a lot easier.

When we started, they helped us to measure our sales process, which allowed us to see for
the first time where our leads were coming from and what they were costing.

Then we worked together to build a new sales system to help communicate what we offer to
customers. Before, many enquirers would ask for information and we'd never hear from them
again. But now we have a better system and sales materials, which have had a big effect on
sales conversion. Marketing Results totally rewrote our info pack and transformed it into an
effective sales tool, with an excellent balance of information and sales.

The other thing that has been a huge success is our website,JapaneseBrisbane.com. To be
honest I was a little skeptical that we could get business over the internet, because we had a
website before that was doing nothing for us, but now our new website accounts for about
80% of our new student enquiries. And when customers contact us via the web, most of them
say something like, "I've seen your website, the courses look great, when can I start?"

So you could say that we are delighted with the return from working with Marketing Results.
On a number of occasions, they've worked to incredibly tight deadlines to help us take
advantage of sudden marketing opportunities, such as a PR piece that was published in the
Brisbane Courier Mail on October 11, 2003. We had more calls the following Monday morning
than we normally get in a week.

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If you're looking for practical marketing help for your business, I thoroughly recommend
Marketing Results. We tried them for 3 months, got the results, and we continue to work with
them now.

Case study from: http://www.marketing-results.com.au/marketing-case-studies/case-

study_JIC.php

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