ABM9 – BUSINESS ENTERPRISE SIMULATION

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LESSON 1
Introduction

At the end of this lesson, the students are expected to:

 Integrate the competencies, skill and learning acquired by the students from ABM
Strand and course
 Understand Scan the market and Identify business opportunities to capitalize on.

Business – is the process of

producing goods and
services and selling them to
those who desires or want
them.

Characteristics of Business

Business Enterprise
Simulation is the
culmination of all the
learnings you have
gained from all the
specialized subjects of
Accountancy, Business
and Management (ABM).

Through the subject, you

will be able to formulate,
study and implement your
own business venture

The Business Enterprise Simulation will be the culmination of the subject Organization and
Management as we will begin from scratch. It also considered a start -up.

(Garade-Orjalo and Frias 2016)

However, it will be limited to the Sole/ Single Proprietorship as it is the simplest form of business to
be established and it requires minimal documents
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Functions of Management

1. Planning

Planning is how to do a work, when

have to do this work, who will do this
work and by whom will do this work.
Planning means the process of
achieving goals, development and
establishment. Planning means
deciding how best to achieve goals,
profit and applying best strategies.

2. Organizing

Organizing is a management process

that refers to the relationship between people, work and resources that is used to achieve goals.
In organizing system top management first fixes the common objective, way and resources. In
organizing the manager make different kind of department and mixed all the department for
better work.

3. Staffing

Employee are the most important resource of any organization. The right staff is very important
for a company because he can change and ensure the organization future success. Staffing is
like a function or term that refers recruitment, selection, acquiring, training, appraising
employees.

4. Directing

Directing is a very hard and heart task of management process. it the function of Staffing.
Planning, organizing, staffing have not any place if direction function does not play its role
properly.

Directing is a continuous process that run its function at top level and flows to the bottom with
organizational hierarchy.

5. Motivating

In management motivation refers ways in which managers promote the productivity in their
employees. Motivating is a manager's job to motivate employees to do their jobs well and fell to
perform well with happiness.

6. Co-ordination

In organization, different types of work are performed by various departments and no single
department or group cannot achieve the goals if they doesn't work as a whole. Co-ordination is
ensures the unity of action among individuals, department and groups in carrying out the
different tasks as to achieve the organizational goals properly. The coordinating is only applies to
groups efforts but there is no need it when only individual is working.
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7. Controlling

This process is simply steps of manager to determine whether organizational goals have been
met. Controlling is a continuous and forward looking process which is the standard of
measurement of a company or organization. There is a close link in planning and controlling in
management function process.

WHAT IS A PRODUCTS

Introduction

What is a Product? A Service?

Basically, a product is a tangible offering to a customer, whereas a service is an intangible offering.

The former is usually a one-time exchange for value. In contrast, a service usually involves a longer
period of time. The value of a product is inherent in the tangible offering itself, for example, in the
can of paint or pair of pants. In contrast, the value of a service often comes from the eventual
benefit that the customer perceives from the time while using the service. In addition, the
customer often judges the value of a service based on the quality of the relationship between the
provider and the customer while using the service.

What’s a product?

Product - is a good or service that corresponds to a unique company offering that has typically
gone through a formal process (equipment, software package, consulting offering, etc.)
 For development and market introduction and usually has a proprietary name (often with
a trademark or ™ or ® symbol).

 Where the possibility of a registered trademark for a product is not possible due to the use
of a word or concept deemed too generic, a service mark (represented as “sm” beside a
logo) may be used.

Characteristics of Products

1. A unique name: Typically trademarked

in countries where the product is offered

2. A defined/standardized feature set: a)

core product and b)
pre-defined optional capabilities /
characteristics

3. A published price: a manufacturer’s suggested retail price or a “street” price

4. A defined delivery model: there is low (er) risk since it was addressed during production. The
product can be delivered to multiple customers.
5. Repeatable: Providing it to one customer does not prevent another from also purchasing the
same product
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6. Documentation: The product’s core functionality is documented using generalized terms.

7. Competitors: the product can be compared with competitor’s offerings using a range of
variables, from basic info such as price per unit to complex info such as system requirements that
may be a specific limitation of a product.

8. Defined dependencies: requirements for using the product are clearly defined. The product has
been tested with required dependencies in place and its proper functioning in such
circumstances is generally assured by the vendor.

This screwdriver comes with multiple options. It could be part

of multiple solutions.

What is a solution?

Whereas a product has the potential of doing something, a solution is the application of
a product to solve a specific industry need or business problem.
When paired with a screw (another product) and a carpenter (a service), the screwdriver is part
of a solution for building a home.

What is Opportunity Seeking?

The ongoing process of considering, evaluating, and pursuing market-based activities that are
believed to be advantageous for the firm.
Prior experience informs the process, but it may also limit it: opportunity seeking calls for
continuous reconsideration and adaptive learning.

Why is environmental scanning important in marketing?

Performing regular environmental scanning is important for organizations of all sizes and across all
industries. This helps them to identify potential threats and opportunities as well as strengths and
weaknesses that impact the business and its competitors. Having more knowledge about these
components of a business and the environment in which it operates can help leaders when
making decisions as well as those involved in the strategy behind the business.

This approach is also important for marketing departments because it allows marketers to learn
more about the strategies taken by competitors. Marketing a product or service often requires the
positioning of that offering as stronger or more appealing than anything available from
competitors, so scanning the environment can help you learn more about the actions of
competitors and use that information in the positioning strategy. The data extracted from
environmental scanning can also play an important role in the long-term approach of the
business, including any plans to scale or grow.

SWOT analysis

A SWOT analysis is a common method of environmental scanning. SWOT stands for strengths,
weaknesses, opportunities and threats. When performing a SWOT analysis, the marketing
ABM9 – BUSINESS ENTERPRISE SIMULATION

department of an organization must look internally at the company's strengths and opportunities
and externally at its weaknesses and threats.

Research

Performing research is one of the most commonly used techniques in environmental scanning.
Many organizations across various industries rely on their own research to learn more about the
political climate, legislative shifts, technological advancements and other potential changes that
can impact the industry in which they operate. Research has become such a vital tool in the
marketing and development processes that organizations often have their own research and
development teams or departments that conduct internal research.

Expert opinions

Seeking the opinions of experts is a method of environmental scanning that can provide new
insight into the industry or the way an organization operates. When using this technique, it's
important to look for experts in the industry who listen to the conversations between other people
and can decipher what trends or shifts may arise. Marketers might use this information when
developing and creating their own strategies and approaches, and they might also use the data
extracted from experts to emphasize or reinforce the points they're trying to make about a
particular subject.

Industry analysis

An analysis of the industry in which a company operates is another technique used by marketers
when performing environmental scanning. When analyzing the industry, one of the key areas of
focus is competitors, both direct and indirect, of the organization. This technique helps a business
to learn more about the strategies of competitors and determine what strategies is can use to
compete against those companies.

PEST analysis

A PEST analysis provides insights into external macro-environmental factors, making it a useful
technique for environmental scanning. The acronym stands for political, economic, social and
technological. When performing a PEST analysis, marketing professionals will look for potential
government shifts and other political factors as well as economic shifts that may impact the
business. Social factors include how people are discussing the product and industry, while
technological factors include any upcoming or shifting technology that could play a role in
shaping the company's future.

Lesson Assessment:

1. Look for tangible products, explain the features; pictures before and after innovation.
(10 points)

2. Make a survey questionnaire sample of your product offering for your Business Plan(10
points)
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