Deck 19: Managing Marketings Link With Other Functional Areas

Question 1

Explain how a marketing manager's sales forecast for a new marketing plan might be used by
a. A financial manager.
b. An accountant.
c. A production manager.
d. A human resources manager.

Answer 1

Generally marketing managers forecast the sales and plan a marketing strategy. In order to develop marketing strategies and plans, marketing managers needs financial support from the finance department to meet the expenses. Besides based this planning, production activities need to be reviewed to check the available capacity. In this way the marketing and marketing managers links to different other functional areas.
a.
Financial manager:
A marketing manager, sales forecast can be used by financial managers to determine how much budget need to be allocated and to plan the revenues. This will help them to plan for the estimated capital investment that is required for execution of strategy. The Financial manager can plan for the cashflows that includes daily costs and expenses associated with the plan.
b.
Accountant:
A marketing manager, sales forecast can be used by accountant to know the information regarding the costs associated with the marketing plans. They can estimate the profitability of customers and products through profitability analysis.
c.
Production manager:
A production manager needs to forecast the production quantity based on the marketing manager, sales forecast in order to meet the customer demand. The production manager needs to match the supply and demand, he needs to plan the alternatives to increase the capacity or reduce the problem of the unused capacity in the production and operation outlet.
d.
Human resource manager:
Based on the marketing manager, sales forecast Human resource managers need to determine how much man force need to be hired to match the required skills and the number of jobs. They need to plan for recruiting the prospective candidates and train them in order to meet specific goals of the company.

Question 2

Explain the difference between natural accounts and functional accounts.

Answer 2

Accounting data helps the managers track the costs and profits of the organizational transactions, these data helps the managers to take the strategic decisions hence, accounting data helps the managers to take crucial decision of the company.
Natural accounts: This account consists of the various costs that are used in normal financial and accounting cycle. The general items included in this account are salary, wage, taxes, raw material and supplies.
Functional accounts: this account is related to all the functional areas costs that includes marketing activities, investments like advertising, personal selling, etc. this functional account helps the managers to get an insight on the expenses of the company. So, the managers can have the opportunity to check the expenses and have the control over it.
The difference between natural accounts and functional accounts is natural accounts have included the costs associated with the financial accounting of the company. On contrary functional accounts includes the expenditures associated with the company.

Question 3

Could the approaches to cost allocation that we discussed in this chapter apply to a firm, like a travel agency, that produces only services Explain your thinking.

Answer 3

While deciding the cost the finance manager distribute to four different functional accounts like advertising, sales, packaging and billing and collection. Based on the product features and demand the costs for different functional areas will be allocated.
Generally, the calculation for allocating costs to the functional areas depend on the demand and the number of products sold.
A firm like travel agency need to allocate costs to different departments like setting up of equipment, i.e. fixed asset and allocating cost to its daily expenditure which include marketing planning cost, advertising cost and customer service cost.
So, the cost allocation approaches will be applied to travel agency as it provides services to the customers. It should have an idea about how much funds it is allocating and need to maintain accounts for its expenditures in the future. This calculation and accounts help the travel agency to calculate the profitability of the firm
Firms which produce services to the customer also allocate cost to different areas for the purpose of easy calculation of cost assigned to a specific category.
For example:
If a firm receives 60 customer care calls each day, if all calls takes same time then the average cost per call can be calculated by dividing the total cost of calls ($1000) by number of calls.
So, in the same manner average cost of different functional areas like advertising and break down for packaging cost and billing can be calculated and allocated.
Therefore, cost allocation approaches can be applied to firms like travel agency that provides services. In order to plan the budget and allocate according to it, cost allocation approaches help the firms. Hence this will help the firms to operate effectively.

Question 4

What types of human resource issues does a marketing manager face when planning to expand sales operations from a branch office in a new overseas market Are the problems any different than they would be in a new domestic market

Question 5

The Marketing Plan Coach software on the text website includes a sample marketing plan for Hillside Veterinary Clinic. Think about the entire marketing plan-since you have been reviewing this all along. While there are not separate departments in a small business, there are different functions.
a. How can Hillside fund future growth plans
b. Can Hillside calculate the profitability of individual customers Should it try
c. Has Hillside accounted for the local labor market in its growth plans

Question 6

Identify some of the ways that a firm can raise money to support a new marketing plan. Give the advantages and limitations-from a marketing manager's perspective-of each approach.

Question 7

An entrepreneur who started a chain of auto service centers to do fast oil changes wants to quickly expand by building new facilities in new markets but doesn't have enough capital. His financial advisor suggested that he might be able to get around the financial constraint and still grow rapidly if he franchised his idea. That way the franchisees would invest to build their own centers, but fees from the franchise agreement would also provide cash flow to build more company-owned outlets. Do you think this is a good idea Why or why not

Question 8

Explain, in your own words, why investors in a firm's stock might be interested in a firm's marketing manager developing a new growth-oriented strategy. Would it be just as good, from the investors' standpoint, for the manager to just maintain the same level of profits Why or why not

Question 9

A woman with extensive experience in home health care and a good marketing plan has approached a bank for a loan, most of which she has explained she intends to "invest in advertising designed to recruit part-time nurses and to attract home-care patients for her firm's services." Other than the furniture in her leased office space, she has few assets. Is the bank likely to loan her the money Why

Question 10

Could the idea of mass customization be used by a publisher of college textbooks to allow different instructors to order customized teaching materials-perhaps even unique books made up of chapters from a number of different existing books What do you think would be the major advantages and disadvantages of this approach

Question 11

Give examples of two different ways that a firm's production capacity might influence a marketing manager's choice of a marketing strategy.

Question 12

Is a small company's flexibility increased or decreased by turning to outside suppliers to produce the products it sells Explain your thinking.