Dallas Business Consultant Elijah ClarkDallas Business Consultant Elijah Clark

Business Crisis Management

Definition of crisis management

A crisis management is the way that a person or business handles an emergency. In a family, this could be a member having to suddenly go to the hospital because of an accident. In a business, a crisis can be anything from a defective product recall or an economic change that causes a drop in sales.

How crisis management relates to business

Within the marketing industry, having the ability to understand and react promptly when crisis arises is crucial for maintaining the businesses market share, trust, and reputation. Not managing a crisis properly can have the potential to damage carefully developed equity, and spoil consumers’ quality perception (Chen, Ganesan, & Liu, 2009).

Personal experience with crisis management

As an online marketer, I run into crisis management issues oftentimes on a weekly basis. Each week I monitor my clients websites ranking through analyzing Yahoo, Bing, and Google search engines for algorithm changes. It’s normal for search engines to change their algorithm and I do advise my clients that their website rank may change drastically if such a change occurs that may affect their website. Once this happens, a site that previously ranked on the first page could drop out of the search engine completed. As this occurs, It usually causes a loss in site traffic and sales. The solution to this is for me to research and analyze the issue, check whether it’s a search engine issue or a website issue and then correct or explain to the client that recovery is impossible.

Summary of About the Crisis Marketing and The Crisis of Marketing

This article focuses on the global economic-financial marketing crisis. According to the article, marketing may be just the solution for many companies to get out of the crisis, but what is sadder is that a lot of them do not realize it (Cornelia & Mihaela, 2011). The article tackles the subject of why marketing is needed within a failing economy and how to successfully implement new strategies to help increase and sustain profit and productivity.

Avoiding negative impacts of a crisis

Research has indicated that a proactive strategy may have positive consequences on consumer perception if the crisis is responded to with a constant, active, and firm response (Chen, Ganesan, & Liu, 2009). The business being affected should respond quickly to the crisis and should focus their attention on building and strengthening consumer trust. During a crisis, marketing strategies should be analyzed and focus on resonating emotionally with the consumer through a human, friendly language (Cornelia & Mihaela, 2011). Without proactively managing the crisis, the risk of negative impact rises.

 

Credits

Cornelia, M., & Mihaela, B. (2011). ABOUT THE CRISIS MARKETING AND THE CRISIS OF MARKETING. Journal Of Academic Research In Economics, 3(3), 311-316.

Chen, Y, Ganesan, S., & Liu, Y. (2009). Does a firm’s product-recall strategy affect its financial value? An examination of strategic alternatives during product-harm crises. Journal of Marketing, 73(6), 214–226.

Content Management Systems CMS

Stay Updated With a CMS

With some websites, having fresh content is mandatory to gain new and repeat clients. With a Content Management System (CMS), you can keep your site updated with the latest news articles, products, and services. You have full control over what you want to put on and take off your site.

Updating:

Your website needs to be easily upgraded with new content on a regular basis. A CMS gives you full control so that you can easily add new updates and blogs to your website without having to call a programmer to do it for you.

Results:

All content can be managed through a simple user interface that allows for quick task completion. The Administration area is easy for all to use, and can involve multiple access levels for various management controls.

With a CMS, you can easily implement and manage:

  • Article publishing
  • Website forums
  • Photo galleries
  • Surveys and polls
  • Projects
  • Interactive event calendars
  • Complex data entry forms

Analyzing Project Feasibility

Making a Business Case
It is important to calculate the profit estimate when taking on new projects. Determining the net present value (NPV) of a project helps determine if a project should be accepted or rejected. The NPV is an important method to use in concluding the value of projects. The NPV formula determines the value of an investment based on its discounted cash flow. The NPV is calculated by subtracting the project cost from the present value (PV). The NPV capital budgeting rule suggest that projects with a positive NPV should be accepted and projects with a negative NPV should be rejected. According to the NPV capital budgeting rule, the firm could benefit from approving this project because of its positive NPV. Based on the positive NPV, this project can be assumed a valuable investment.

Project Risk
If there is concern regarding risk associated with the project, the firm could optionally use a cut-off threshold. A cut-off threshold prevents project budgets from going into the negative by using cut-off numbers that determine when and if a project should be shut down and abandoned. A project should be abandoned if the value is too low and the expected revenues do not justify further project investment. In addition, putting the project together in stages and with budgets for each stage can reduce risk. Upon each stage completion, the firm would invest into the next stage. Consequently, the financial risk would be minimized.

Decision Justification
Considering the NPV for this project is positive, it will likely generate positive cash flow and would not do any harm to the firms’ status quo. Having a positive NPV suggests the project will generate value for the shareholders’ wealth. If the NPV value is accurate and the project is successful, it could potentially have positive effects on the firms’ equity value.

In addition to the benefits, there are considerable risks and disadvantages of using NPVs. Considering NPVs are based on only assumptions, it does leave room for error. A small company could have a difficult time providing reliable estimates based on the NPV data. Minor changes in the interest rate could affect the projects discount rate, which could drastically affect the projects NPV. A concern of the NPV is its requirement to make calculated projections. In most scenarios, the formula will not be 100% reliable. Before deciding based solely on the NPV, a discounted cash flow analysis should first be analyzed. Although the NPV formula does present a feasible projection of cash flow, it does not present the projects actual return. Because of the difficulty of determining an exact valuation, there could be unforeseen cost, which could incur a negative cash flow rather than a positive one.

Something else to take into consideration when investing into a project is the IRR. Both NPV and IRR are tools used to evaluate potential project investments by measuring capital budgeting, which is the process used to determine significant business investments. While NPV examines cash flow value based on the discounted rate, the IRR defines the rate of return for a project based on the stream of cash flow. IRR is the discounted rate that converts the present value to zero by making the current value of cash flows equal to the present value of cash outflows. Disadvantages of using IRR is that it is not ideal for long-term projects considering the calculation does not evaluate discount rates. Another limitation of using the IRR is that the method does not consider the initial investment amount. This can present a problem when comparing two alternative investments based solely on the IRR. Businesses can use both NPV and IRR to assist with making investment decisions. However, there is no 100% method to use, which will guarantee a positive return on investment. When making an investment decision, the investor should take into account the IRR, NPV, and other investment indicators including risk, and alternative options.

A phenomenology research method

Based on my research of a phenomenology, it uses descriptive analysis to capture experiences (Sanders, 1982). The method evaluates experiences and brings them closer to lived phenomena (Sanders, 1982). A phenomenology study is a method used for unfolding human experience by examining the uniqueness and commonalities of events and circumstances. A phenomenology approach is recommended for continually evaluating biases and presuppositions (Sanders, 1982). A phenomenology study focuses on understanding the meaning of human experiences by analyzing the pure and unencumbered visions of experiences. A phenomenology research design comprises of three components, which are a) determining limits of who and what is to investigate, b) data collection, and c) phenomenology analysis of data (Sanders, 1982). The data collection techniques used in phenomenology research include in-depth, documentary, and observation. Additionally, it is essential that interviews conducted are recorded and transcribed.

Additional Reading

Sanders, P. (1982). Phenomenology: A new way of viewing organizational research. Academy Of Management Review, 7(3), 353-360. doi:10.5465/AMR.1982.4285315

Qualitative research methods

Qualitative research methods work to understand and discover experiences, perspectives, and insight of participants (Hiatt, 1986). An advantage of a qualitative approach is that study participants are not constrained to a predetermined set of responses (Harwell, 2011). A downfall of the study in regards to collecting data is that it is expensive considering the amount of time needed to collect the data. Qualitative research consists of using lived experiences and interpreting the phenomena (Denzin & Lincoln, 2005).

Quantitative research methods focus on increasing objectivity and typically interested in future prediction (Harwell, 2011). Features of quantitative research include instruments used for collecting data, which often include test, reliance, probability theory, and surveys for analyzing statistical hypothesis that relate to research questions. Quantitative methods are considered deductive in nature considering collected data create general inferences about the characteristics of a population (Harwell, 2011). A quantitative method often makes assumptions that there is only a single truth that exist, which does not include human perception (Lincoln & Guba, 1985). A quantitative approach is beneficial for gathering information. The problem with this approach is that it does not cover the reason for why certain data concluded in a certain manner.

Mixed methods combine qualitative and quantitative methods by linking their differences while addresses a research question (Harwell, 2011). The key principle of mixed methods is that various forms of data should be collected by using multiple strategies and methods. The methods should assist with reflecting complementary strengths and weaknesses that do not overlap. The mixed methods study should create insight that is not possible with only a qualitative or quantitative approach. Mixed methods produce opportunities for approaches with weaknesses and presents opportunities by correcting method biases (Harwell, 2011). Mixed methods approach uses balance for efficiently collecting data. The concern with using a mixed methods approach is that the method struggles to complement, and not duplicate each approach (Harwell, 2011).

Research study methodologies are characterized as either qualitative, quantitative, or a combination of both, which is referred to as mixed methods. Of the methods, neither can be considered the best method without factoring the goals and objectives of the research. Research that desires to focus on interviewing lived experiences of participants should use a qualitative approach (Harwell, 2011). In contrast, a mixed methods approach should be used for research that needs a combination of qualitative and quantitate approaches to justify the goals and objectives.

 

Additional Resources

Denzin, N. K., & Lincoln, Y. S. (2005). Introduction. In N. K. Denzin & Y. S. Lincoln (Eds.), The SAGE handbook of qualitative research (3rd ed., pp. 1–29). Thousand Oaks, CA: Sage. doi:10.1108/09504120610655394

Hiatt, J. F. (1986). Spirituality, medicine, and healing. Southern Medical Journal, 79, 736–743. doi:10.1097/00007611-198606000-00022

Harwell, M. R. (2011). Research design in qualitative/quantitative/mixed methods. The Sage handbook for research in education. 2nd ed. Los Angeles, CA: Sage, 147. doi:10.4135/9781483351377.n11

Lincoln, Y. S., & Guba, E. G. (1985). Naturalistic inquiry. Newbury Park, CA: Sage. doi:10.1177/144078338702300329

Work Productivity

Performance is dependent upon satisfaction toward the party most benefitted. Additionally, the ethics of the organization and its leadership have a tremendous affect on the morale of the employee. If morale is down, then work productivity may also slack. According to a research by Chekwa, Ouhirra, Thomas, and Chukwuanu (2014), 75% of employees have no desire to work for a company with poor organizational ethics. Additionally, research has discovered that leaders are responsible for creating healthy environments by supporting  employees (Avolio, Walumbwa, & Weber, 2009). Leadership is crucial when developing productive employees and influencing employee morale and satisfaction. To implement and maintain morale, leaders should place importance on stress prevention programs and develop effective communication methods with employees to discover and address issues regarding dissatisfaction and ethical dilemmas (Chekwa et al., 2014). Additionally, research has discovered that leaders are responsible for creating healthy environments by supporting  employees (Avolio, Walumbwa, & Weber, 2009).

 

Additional Readings

Avolio, B. J., Walumbwa, F. O., & Weber, T. J. (2009). Leadership: current theories, research, and future directions. Annual Review of Psychology, 60, 421–449. doi:10.1177/0149206310393520

Chekwa, C., Ouhirra, L., Thomas, E., & Chukwuanu, M. (2014). An examination of the effects of leadership on business ethics: Empirical study. International Journal Of Business & Public Administration, 11(1), 48-65.

Mentzer, J. T., Myers, M. B., & Stank, T. P. (Eds.). (2007). Handbook of global supply chain management. Thousand Oaks, CA: Sage Publications.

Qualitative or Quantitative

Determining whether to use a qualitative or quantitative method is really dependent upon how you desire to collect your data and what is important to you. A qualitative examination technique assesses why people behave a certain way. Furthermore, the strategy aides in discovering boundaries that influence thinking by breaking down points of interest and gathering information from in-depth sources (Šalkovska & Ogsta, 2014). A qualitative examination produces findings that are regularly not conclusive and are exploratory in nature. The advantage of this kind of study is that it gives alternative research to further decision making. A quantitative methodology utilizes information in view of raw information and statistics. The research technique frequently uses experiments and segments to gather information (Šalkovska & Ogsta, 2014).  A quantitative methodology is similar to qualitative concerning the examining of individual practices. However, a quantitative methodology uses structured information to shape a hypothesis and conclusion (Šalkovska & Ogsta, 2014). Unlike quantitative, a qualitative examination is non-measurable. Furthermore, a quantitative exploration produces detailed information that contribute to in-depth comprehension, while a quantitative examination produces information based on populace and generalized information.

Additional Readings

Šalkovska, J., & Ogsta, E. (2014). Quantitative and qualitative measurement methods of companies’ marketing efficiency. Management Of Organizations: Systematic Research, (70), 91-105. doi:10.7220/MOSR.1392-1142.2014.70.7

Security Breach and Ethics

As a healthcare patient, I feel that the privacy of my personal information is a major concern. Organizations should focus on making ethical decisions when handling patient information in regards to implementing effective security and privacy measures (Haag & Cummings, 2008). Many organizations including healthcare spend thousands or millions of dollars on securing patient privacy and protecting data against breaches and hackers (Farahmand, Navathe, Sharp, & Enslow, 2005). It is the responsibility of leaders and management to understand and influence ethical practices which relate to privacy and security threats (Haag & Cummings, 2008). Security breaches have the ability to disable the functions of a business and pilfer confidential consumer information such as healthcare information, social security numbers, and passwords (Tran & Atkinson, 2002). In addition to potential loss in revenue, breaches also create consumer distrust, and negatively affect brand reputation (Farahmand et al., 2005).  The risks associated with breaches such as loss of confidentiality, integrity, and availability, should cause organizations to be aware and active with threats that generate concerns (Halliday, Badenhorst, & Solms, 1996).

 

Suggested Readings

Farahmand, F., Navathe, S. B., Sharp, G. P., & Enslow, P. H. (2005). A management perspective on risk of security threats to information systems. Information Technology and Management, 6(2–3). doi:10.1007/s10799-005-5880-5

Haag, S., & Cummings, M. (2008). Management information systems for the information age (Laureate Education, Inc., custom ed.). Boston: McGraw-Hill/Irwin

Halliday, S., Badenhorst, K., & Solms, R. (1996). A business approach to effective information technology risk analysis and management. Information Management & Computer Security, 4(1). doi:10.1108/09685229610114178

Tran, E., & Atkinson, M. (2002). Security of personal data across national borders. Information Management & Computer Security, 10(5). doi:10.1108/09685220210446588

What is an RFID?

In regards to global logistics, technology including radio-frequency identification (RFID ) assume a critical part in developing harmony in understanding overstocking and understocking expenses for organizations. The technology allows for organizations to better forecast product demand in the business sector (Pokharel, 2005).  Additionally, RFID’s are used to assist organizations with accomplishing stock level and expense goals by providing information used to help manage and implement logistics. RFID innovation is currently used in organizations such as Wal-Mart to assist in tracking products and provide real-time data to prevent counterfeiting and to monitor stock levels(Pokharel, 2005). RFID technology is equally important for privacy rights of individuals and global logistics. However, RFID plays a more common role in logistics than for individuals. The ability to track and monitor products by utilizing RFID technology has been proven effective and continues to be a reliable resource for many organizations.

 

Suggested Reading

Pokharel, S. (2005). Perception on information and communication technology perspectives in logistics: A study of transportation and warehouses sectors in Singapore. Journal of Enterprise Information Management, 18(1/2). doi:10.1108/17410390510579882

Privacy and Ethical Concerns

Ethical considerations within businesses are largely over-looked within marketing management research (Bell & Bryman, 2007). Business ethics research inherently focuses on sensitive and controversial issues (Miyazaki & Taylor, 2008). Consequently, most business ethics research is susceptible to interaction biases (Miyazaki & Taylor, 2008).

There is a growing concern from consumers that their privacy and personal information is being digitized and sold without their permission (Foxman & Kilcoyne, 1993). The concern is that credit cards, billing details, and other private data is bought and sold across the marketing industry between businesses and organizations to use as soliciting tools. Consumers agree that the lack of organizational ethics when collecting the information is morally wrong (Foxman & Kilcoyne, 1993). The debate amongst consumers and businesses is that both parties feel they own the information submitted. Businesses believe that they have the right to use the information any way they choose to help better their organizational goals and to produce better marketing services (Foxman & Kilcoyne, 1993). Additionally, the organizations that purchase the user information feel they own the data because they purchased it.

If the results show that a company is being unethical by confusing or misinforming consumers on how their private information is used, management should work diligently to resolve the confusion by making privacy details clear. In formulating a research-oriented approach that would benefit the practice in regards to the issue presented, I recommend utilizing a qualitative format similar to the constructivist format. I would begin by outlining the problems being addressed and then focus on presenting existing literature regarding the problem and the significance of the study (Creswell, 2009). Next, I would present procedures including a qualitative research strategy for collecting the necessary data. Finally, I would focus on validating my finding using various forms of interview questions, observational forms, timelines, and proposed budgets (Creswell, 2009).

Recommended Readings

Bell, E., & Bryman, A. (2007). The ethics of management research: An exploratory content analysis. British Journal of Management, 18(1), 63–77. doi:10.1111/j.1467-8551.2006.00487.x

Creswell, J. W. (2009). Research design: Qualitative, quantitative, and mixed methods approaches (Laureate Education, Inc., custom ed.). Thousand Oaks, CA: Sage.

Foxman, E. R., & Kilcoyne, P. (1993). Information technology, marketing practice, and consumer privacy: Ethical issues. Journal of Public Policy & Marketing, 12(1), 106-119. doi: 10.1007/s10660-007-9000-y

Miyazaki , A. D., & Taylor, K. A. (2008). Researcher interaction biases and business ethics research: Respondent reactions to researcher characteristics. Journal of Business Ethics, 81(4), 779–795. doi:10.1007/s10551-007-9547-5

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