A.

BUSINESS GOALS Business goals are desired outcomes that an individual or business intends to achieve within a certain time frame. South Coast Business& Financial Solutions Pty Ltd(SCS) has been successful in achieving their goals through relevant planning, at a significantly larger scope than small businesses in the same industry. SCS s goals are arranged in 2 categories: financial and non financial categories. 1. FINANCIAL 1. Profits maximisation SCS aims for profit maximisation, where there is a maximum difference between the total revenue and the total costs of the business. In last year alone managing director, Tony Cottam, was ranked 5th in the MPA s top 100 brokers list through his settlement of $72.5 million, resulting in the greatest gross profit percentage of 75%the company in 5 years, the average percentage is within the range of 30%-60%. Profit = total revenue total costs 2. Maximise Growth 2.1 Internal The internal growth of a business involves the employment of more people, thus increasing sales. This applies to SCS, during the expansion of the business into the South Coast area, more employees were employed to meet the demand the business experienced. 2.2 External External growth is achieved by merging with or acquiring other businesses.SCS aims to maximise growth, through implementation of investor groups. Investor groups are basically inter- business relationships developed into an alliance, whereby each member business is obliged to refer clients to other businesses within the alliance. Over the last 10 years, with the implementation of investor groups the business has expanded throughout the local area and into the local South Coast community. Similarly they purchase cash flow positive regional properties that represented good value to ensure the growth of there business externally. Although SCS has decided to grow externally some small business owners are content to maintain the existing size of their business to: y Avoid added pressures of expansion in a desire for a quiet life or a particular lifestyle y Keep control over the business s operations y Maintain personal contact with the customer 3. Increase market share The market share of SMEs is usually restricted to the size of the business. SCSs market share was limited to the number of customers living within its immediate area, up until its expansion into the local community. One of the most successful strategies used to increase market share is promotion.( further information in Key business functions 4Ps ) Promotion describes the methods used by a business to inform, persuade and remind a market about its products, for example SCS has 70% of client come through referral, 20% through alliances and the other 10% through advertising. Prior to their external growth in 2005, up to 65% came from advertising alone. 4. Improve share price Another financial goal of a business may be to increase its share price. A share is a part ownership of a public company, thus shareholders are the real owners of the company. This concept does not apply to SCS as it is a privately own company. However there are 2 reasons for buying shares: y To sell them for a higher price y Entitlement to a part of the company s profit, distributed in the form of dividends. In order for this to be successful, the company must maximise returns to shareholders whilst acting ethically. Unethically behaviour may lead to momentary increase in share prices, however ultimately detrimental to a business. 2. NON FINANCIAL Businesses do not always focus on the financial aspect of their business, many also develop social, environmental and personal goals and adopt strategies to achieve them.

1. SOCIAL GOALS Social goals are developed to benefit the wider community. 1.1. Community service Business sponsorship of wide range of community events, promotions and programs has rapidly increased inthe last decade. SCS has supported various charities, sporting teams and sporting events in the local community, such as: y South Pacific Open Tennis Tournament y Milton Ulladulla Tennis and y Cancer Outpatients Appeal Golf Tournament SCS address there goal of creating a sense of unity through their services to the community. They also aim to help clients achieve lifestyle and financial goals, whilst maintaining the happiness of its employees. SCS address this goal by encouraging employees to undertake further study at the expense of SCS, the business ensures that its employees are more productive as well as happier, thus enabling the achievement of helping their clients to their fullest potential. 1.2 Provision of Employment Most large businesses do not regard employment of people as main goal. On the other hand, many small businesses, such as SCS, look at the continuity of their business, SCS owner, Tony Cottam, employed his sister Karen Bashford, employing a family member who otherwise might be unemployed. 1.3 Social Justice A business may be concerned for social justice, whereby everyone deserves the right to be treated fairly. In recent years the government has forced businesses to take into account justice issues through legislation such as the Racial Discrimination Act 1975. In order to address these requirements and satisfy the social goal of SCS to raise awareness in the community based upon issues that they believe to be basic to all those in society, there is a no tolerance policy for sexual harassment, bullying and racism. 2. ENVIRONMENTAL GOALS In the effort to increase output, essential maintenance is sometimes ignored. The business s supplies, such as water and power are under increasing threat, and continuing in this way is unsustainable. 2.1 Sustainable Development Sustainable development occurs when the needs of the present population are met without endangering the ability of future generation to meet their own needs.SCS adopts practices of recycle, reuse and regenerate , as well as adopting a green attitude, however over the lat year they have adopted a virtual office approach . They are one of the first brokerage businesses to become paperless . That is, all documents, including faxes, are automatically sent to the businesses inbox and can be accessed via a database. SCS and other businesses are starting to play their part in achieving sustainable development. Pressure to change has come from society s increasing awareness of environmental issues, as well as stricter environmental regulations. 3. PERSONAL GOALS Business owner s, normally, have a number of personal goals, often reflected in the operation and nature of the business. At SCS Tony Cottam motivates his employs in order to achieve Sustainable development of a business, where we are role models of a smart, efficient method of brokerage that creates an atmosphere of unity in society B. APPROACHES TO MANAGEMENT 1. CLASSICAL MANAGEMENT APPROACH In response to complex problems, managers develop and test solutions focusing on finding efficient ways to perform and manage tasks, thus the classical approach of management.

1.1 Classical scientific The approach studies in detail the best way to perform a job. Founder Frederick W Taylor attempted to systematise the way a job was done, which is now seen in many modern businesses. SCS has a system where each enquiry is divided to enable a solution of high quality. It is passed between specialised individuals of an area until a solution is passed back to the client. 1.2 Classical bureaucratic This approach was pioneered by Max Weber and Henri Fayol, where bureaucracy was seen as the most efficient form of organisation. SCS address parts of this approach in planning, organising and controlling. i) Planning Planning is preparing a predetermined course of action for a business. SCS plans on 3 levels: A. Strategic plans, whereby business alliances with accountants and solicitors increase the number of clients and increasing the business profile in the long term. B. Tactical plans, where these alliances are formed at the exclusion of other businesses allowing SCS to fulfil its goals. This is usually a medium-term plan C. Operational plans are short term where day to day business functions are organised to run smoothly. ii) Organising The business determines what is being done, by whom and how, thus plans translate into actio ns. A. Determining work activities by SCS involves the dividing of an enquiry into manageable parts. B. Classifying and grouping these parts then a specialised individual completes sections similar to their specialisation. C. Assigning work and delegating authority determines who is responsible for the enquiry and ensuring a solution is formed. iii) Controlling Controlling compares the intended occurrence and actual occurrence. 3 steps in this process which SCS follow with their services: 1. SCS establish standards according to business goals and input/regulations of employees, management , industry and government 2. Measure performance and determine how SCS can improve or continue to meet standards or benchmarks. 3. Corrective action by changing activities, processes and personnel to ensure that the goals of SCS have been met and standards are maintained. 1.3 Organisational Structure for SCS (INSERT DIAGRAM HERE) 1.4 Leadership Styles Manager leadership style is essentially their way of doing things in terms of behaviour and attitude. There are 4 leadership styles: i) Autocratic or authoritarian where manager tells employees what and how to do tasks, no employee input. ii) Democratic where the employees get some say in decisions that are made iii) Collegial where management adopts an integrative role and establishes an environment of mutual contribution, at SCS this style is adapted as it allows employees to be self-directed and intrinsically motivated. For example employees are given authority to run the business in the manager s absence. iv) Laissez- Faire is where the manager only provides advice when it is asked for; used by SCS as it is effective with research as employees work in teams.

2. BEHAVIOURAL MANAGEMENT APPROACH SCS attempts to minimise stress to employees are much as possible. The behavioural approach was a theory of Elton Mayo, emphasises that employees should be the main focus of the business organisation and employee social needs significantly impact productivity. i) Leading and management. SCS manager, Tony Cottam, believes a leadershould display empathy and have good listening skills. Leading and managing are different a manager has intent to complete a job whereas a leader aims to empower. ii) Management as motivating in SCS energises and encourages employees to contribute to achieving businesses goals, without SCS achieving goals interdependent businesses also suffer. iii) Management as Communicating, Tony Cottam, ranked 5th in the MPA top 100 brokers during 2009, communication was integral to his success, efficient exchanging of information between people, and efficient movement of information enabled his success in a changing industry. iv) Teams are vital in the modern workplace, especially in services, the amount of research required needs teams working together allowing efficiency and collaboration between members, permitting high quality solutions. 3. CONTINGENCY MANAGEMENT APPROACH Contingency approach stresses need for flexibility and adaptation of management practices to suit changing circumstances. SCS is based on a continually changing industry, flexibility as a manager has allowed the success of SCS. Overall SCS as a business adopts a combination of management styles. Elements of all three approaches are used with a collegial and laissez-faire leadership style. As the manager of SCS Tony Cottam, believes that teamwork, communication and flexibility as a manager are the most important aspects of this business. C. COORDINATION OF KEY BUSINESS FUNCTIONS Key business functions are core to all businesses regardless of size, location, purpose or length of existence. Though a business can separate key functions into departments functions are interdependent. 1. Interdependence of Business Functions 2. The key business functions can be reduced to four main functions: 2.1 Operations 2.2 Market 2.3 Finance 2.4 Human Resources 1. INTERDEPENDENCE OF BUSINESS FUNCTIONS SCS relies on smooth connections between key functions within the business and interdependence between its strategic business alliances, providing a service for society. Interdependence is integral to the growth of SCS and its alliance businesses. 2. KEY BUSINESS FUNCTIONS Key functions are often separated into specialised departments, due to different skills and knowledge required, this is called a division. In the medium business SCS the divisions overlap. 2.1 OPERATIONS a) Goods and services Goods and services are the results of input resource transformation into output products. Products are: i. Tangible or ii. Intangible i. Tangible

Tangible products can be handled and stored before being sold to consumers. Productionprocess and consumption are not linked, thus minimal customer involvement. ii. Intangible Intangible services cannot be touched, such as the brokerage services of SCS. They provide financial advise and solutions to individuals in society. Services are not tangible, rather it provides benefits, such as knowledge. b) Production Process Three key elements of the production process include: i. Inputs ii. Transformation INPUT TRANSFORMATION PROCESS OUTPUT iii. Outputs i. Inputs Inputs are resources used in the production process: A. Material Inputs Resources required by a business. For SCS services, input materials such as paper and computer software are required. A manufacturing business can require a range of materials depending upon their function. B. Capital Equipment Although the cost for training and educating staff is high, SCS initially started operating on low capital, and has remained to operate with low capital costs. C. Labour Labour costs for SCS are relatively high as it focuses on skilled, experienced and professional staff. D. Information Businesses do not always account for information resources as it is difficult to quantify, however SCS is based upon receiving information from a range of sources in order to give the best advice possible. E. Time Efficiency is integral to every business, to improve efficiency SCS has all clients on a database where client information is available on a server to the employees. SCS also contacts each clients with a case at the present time within two weeks of there inquiry to inform them of any progress, reducing stress and allows better time management. F. Money Money is the most flexible of all SCS s resources, as a medium broker it has the support system of a larger aggregator when necessary, as well as the employment of an individual to assess regulatory aspects of the business and a systems programmer thus easily converted into any quantity or combination of materials, capital or labour. ii. Transformation Involves conversion of input into output. Elaborately transformed manufactures (ETMS) are goods that are highly processed and due to the chain of value increased in value. Simply transformed manufactures (STMs) are goods that can be further processed in a range of processes. SCS brokerage busine provides intangible services, the ss transformation processes is less physical and take the form of knowledge inputs and expertise with outputs as services. iii. Outputs Outputs are the finished goods or services of a business, for SCS the output product requires heavily on customer interaction in determining the output tailored to clients needs, output is responsive to customer s demands. c) Quality Management Quality management is the strategy used to make sure those products meets customer expectations. Approaches to quality: a) Quality control b) Quality assurance c) Total quality management i. Quality Control SCS quality control is based on an inspection of employee performance, every 6 months a mystery client makes an inquiry at SCS. This client then reports back to the manager on the employee s performance. ii. Quality Assurance

SCS assures quality by complying with procedures of the International Organisation of Standardisation (ISO). Quality assurance to customers ensures safe and reliable products and services. iii. Total quality management SCS divides business s operations, allocating responsibility among members of the business, this is referred to as total quality management (TQM). To achieve TQM a number of approaches may be used: A. Employee empowerment B. Continuous empowerment C. Customer focus 2.2 MARKETING a) Marketing Mix The marketing mix involves the four P s: i. Product ii. Price iii. Promotion iv. Place i) Product A product may be better than its competitors, however without good customer service it may not outdo the oppositions product. SCS address this by keeping an on going relationship with its clients. SCS services are design to provide financial advice and solutions to businesses and individuals in the south coast region. Packaging and Branding are associated with tangible products where appearance and graphic representation (logo) are important respectively. ii) Price Cost of financial advice with SCS is between $1500- $3000 depending upon the areas of enquiry and labour time that is required for the solution. Average NSW financial advice cost is $2500- $3500. Ideal price is central to success of SCS. When price is too low it relays negative assumptions of the product, i.e. cheap product of poor quality. When price is too high, number of sales decrease, thus profit margin is reduced. The price is calculated in four ways; Cost plus margin: total cost of production and adding percentage for profit Market price: price according to interaction between quantity customers are willing to purchase and quantity producers can supply Competitor price: price below, equal or above that of similar business products Discount price: reducing price of stock that is not selling to stimulate demand. SCS base price on the cost plus margin and competitor price of financial advice. iii) Promotion Promotion describes the methods used by a business to inform, persuade and remind a market about its products. SCS has 70% of clients referral, 20% strategic alliance and 10% through advertising. Prior to external growth in 2005, 25% came from advertising. Aims to: - Attract new customers by raising awareness of products - Increase brand loyalty - Encourage current consumers to purchase more of the product Main forms of promotion: - Personal selling, the sales assistant outlines the product, tailored to the customers need. SCS implement this method occasionally, as it is time consuming and expensive - Sales promotion, activities are used to attract interest e.g. free samples - Publicity where main aim is to enhance image of product, highlight business s favourable features and removal negative images - Advertising print or electronic mass media are used to communicate messages about the product, SCS social media to attract potential customers, create demand for the service and communicate essential information to potential clients in the South Coast region. Developing technology and social media advertising have become cheaper, easier and more effective, thus SCS advertise through websites and ads via internet.

- Strategic alliances with a small number of soliciting firms and accountants developed a referral system. SCS refers clients to alliance businesses; they offer good advice to the client and satisfy their needs. Alliance businesses also refer their clients back to SCS. Referring clients is a form of promotion, more effective than paying each firm small part of the commission for advice. iv) Place Distribution channel method of getting product to the customer, usually involving a number of intermediaries. SCS uses the producer to customer channel, as services are directly between broker and client. Other channels include: i. Producer to retailer to customer, often used for bulky or perishable products and ii. Producer to wholesaler to retailer to customer, used for distribution of consumer goods. b) Target Market Businesses select groups of customers to concentrate their marketing efforts, their target market. Three approaches for selecting a target market: i. Mass marketing ii. Market segmentation iii. Niche marketing i) Mass Marketing Services that SCS provide can not be addressed to a mass market; its services are not relevant to all buyers. Mass marketing approach seeks large range of customers, developing a single marketing mix and directs it at the entire market for the product. ii) Market segmentation Market segmentation occurs when total market is subdivided into groups of peoplesharing one or more characteristics based on demographic, geographic, lifestyle and behavioural. - Demographic segmentation based upon the characteristics of the population such as age and ethnicity - Geographic segmentation divides market into regional groups using location of consumers, e.g. by nationally. Segmenting using climatic conditions is also used. - Behavioural segmentation divides the market by consumers use of products. SCSs segments include first home buyers. Segments in lifestyle and geographic combined allows SCS to increase sales and profits by understanding and responding better to the target market, 2004-2005 which increased clients by 55%. iii) Niche Marketing A niche market is a small part of the segmented market. It is more specific, e.g. gender segment further divided into age groups. Business may identify primary and secondary market, selecting one as a target market is important in marketing function as it influences the marketing plan. c) Concept Approach SCS aims to look after their client s needs in the financial sector by giving good quality advice and life strategies whilst achieving their business goals. This idea is in relation to the marketing concept, which is philosophy that all sections of business are involved in satisfying a customers needs and wants as well as accomplishing business goals. 2.3 FINANCE i) Accounting Managerial and administrative tool in recording business transactions, SCS has strategic relationships with an accountant. Relationship allows SCS accounts to be done at a cheaper price with the same accountant each time. This also allows the accountant to give in depth feedback on the change between time periods, SCS s experienced a substantial profit increase over the period of January and March 2008, accounting provided the reason being a new alliance with a soliciting firm, boosting their referrals, thus number of clients. ii) Finance Finance is how a business funds its activities, such as money trade and risks with types of borrowing. It is vital for businesses to manage its borrowing and use appropriate types of borrowingto manage costs effectively, a balance of understanding between these two concepts enables informed decisions and assists leadership tasks. iii) Cash flow Cash flow is the life blood of a business, thus SCS has developed the strategic idea that the business only acquires cash flow positive properties. The anticipation of expenses and ensuring enough income is made to

cover the expenses and having money to cover any contingencies. SCS firmly believes that business leaders and managers need to have a good knowledge and understanding of accounting and finance, and need to draw on this knowledge and skill when managing all aspects of the business. 2.4 HUMAN RESOURCES Human Resource Management (HRM) in its simplest terms is defined as the effective management of he formal relationship between the employer and the employees. SCS is successful in the long term as they maintain a balance between concern for success and regard for their employees. i) Human resource cycle The human resource cycle cover all stages in the process of employing staff, from; A. Acquisition, B. Development, (INSERT DIAGRAM) C. Maintenance to D. Separation A. Acquisition This involves the recruitment of suitable employees, SCS manager, Tony Cottam, when through this process before employing. First process was the identification of staffing needs and job specifications, then attracting people to the position and finally selecting a suitable employee either already from the business to a vacant position or someone new (internal and external respectively), this is the process most businesses undertaken during acquisition. T B. Development SCS has a reputation taking employees who SCS thinks has potential to do well in their job. For example Kim Lobo was giving training as the expense of SCS and is now a valued partner of SCS who is the top of her market in Ulladulla. Training and development is purely aimed at improving and acquiring new skills and knowledge. C. Maintenance In regards to maintenance at SCS they offer working conditions which encourage them to remain with SCS. This is done through offering monetary compensation. SCS is also developing a remuneration package, including both monetary and nonmonetary benefits such as cheaper housing loans. D. Separation The separation of human resources is ending the employment relationship either voluntarily or involuntarily. This stage must be handled carefully and sensitively by the human resource manager. 01. Voluntary separation can be : 02. Involuntary separation can be: v) Retirement viii) Retrenchment vi) Resignation ix) Dismissal vii) Redundancy x) Redundancy

D. ETHICAL BUSINESS BEHAVIOUR Business ethics is the application of moral standards to business behaviour 1. Ethical issues i) Fairness and honesty Businesses must follow regulations, and are expected to avoid misleading information. SCS ensuresthat all clients are aware of consequences or risks associated with any advice they receive. SCS also regards enquiries in order of when they were received to ensure fairness. The business also complies with ISO standards of quality and workplace regulations such as Fair work Act 2009, OH&S and EEO. ii) Respect Tony Cottam treats his employees with respect and expects them to act ethically in return. Occasionally, a business may become aware of unethical practice and put the business in a difficult position. iii) Conflict of interest Conflict of interest occurs when a person takes advantage of information or a situation for their own gain rather than for the employer s interest.

iv) Financial management Businesses have ethical and legal responsibilities; generally financial management decisions must reflect objectives of a business and interests of shareholders. SCS keeps all its financial data regularly audited. It allows SCS to monitor and thus guard against unnecessary waste of resources, misuse of funds, fraud andtheft. v) Truthful communication Advertising can represent ethical dilemmas, if they are false or misleading and thus illegal 2. Encouraging ethical business behaviour SCS abides by the Corporate Code of Conduct, many businesses now document codes of conductor core values to proved internal stakeholders with ethical guidelines in workplace behaviour. SCS gives an induction to all new employees of which an introduction to workplace ethics.