Berlitz English Business 1 - Book

Berlitz Language for life.
Business I
Language for life.
Busines
sI
Chapter 1
MARKETING A NEW PRODUCT

Topics
Marketing plans
Target audicncc
Ma
rke
t
res
ear
ch
Bra
nd
na
me
s
Obj ectives
Defining marketing
Comparing rnarket share
-4,
Discussing market research
Brains
tormin
g a
promo
tional
campa
ign
Expres
sions
to hand it
to
someone;
to take a
stab at
somethin
g; to get
carried
away
"Marke
ting is
the
whole
busines
s seen
from
the
custom
ers
point
of
view."
Peter Drucker.
author,
professor, and
management
consultant
OFFERING OPINIONS ABOUT PRODUCTS

pcter: Have you seen the prototype of our new PDA, Julia!
Julia: Not yet. Ooh, nice. So what can it do.'
Peter: Well, ids a cell phone and an organizer with wireless e-mail and a Web browser.
Julia: I love the touch-scrccn display. looks really good. I'm impressed.
Peter: Wait till you hear the price: under a hundred dollars.
Julia: I've got to hand it to you, Peter. Your team has done a great job. Any
thoughts on what we're going to call it?
peter: Marketing has tested several names. It looks like we're going with the
"Pocket Wizard." Julia: The Pocket Wizard I like that.
ar etlng
Defining Marketing
marketing (n.) the process of planning and executing the conception. pricing, promotion, and
distribution of ideas. goods, and services to create exchanges that satisfy individual and
organizational objectives
Source: The American Marketing Association (AMA)
The Four Ps of marketing

Some English-speaking businesspeople define marketing strategy in terms Of the ''marketing mix."
The components of the marketing mix are often referred to as
the Four
PRODUCT includes: name, features, packaging design,
quality, service, warranties
PRICE includes: list price, discounts,
allowances, payment period
PLACE includes: distribution channels, geographic coverage,
locations, logistics
Source: E. Jerome McCarthy, PROMOTION includes; advertising, direct marketing, public
relations, personal selling
Marketing; A Global-Manageriai Approach, Richard l). Iru•in Co.
n Comparing market share FYI

During the first quarter of 2002,
Palm held more than 30% of the
worldwidc PDA market.
Hewlett-Packard captured Second
place with 14% of the while Handspring's
WORLDWIDE PDA MARKET SHARE, Q]
2002
Business • Chapter
By the third quarter of 2002,
VIPs market share had declined
30.6%
I I
owing e customer
Identifring the target audience
In any marketing activity, it is virally important to define the target audience. Defining the target customer
allows companies to answer two crucial questions:
l. Is there a large enough market to support our product / service and generate a profit?
2. What will colnpel custcnners to purchase our product or service instead of another!
Typically, in attempting to define the target market or Custolner, cornpanies differentiate between
consumer and business sectors. Then there arc any number of factors that must also be identified in order
to determine who the target customer is. In the ease of the general consulner, for exalnple, colnpanies
typically gather information on customers'
DEMOGRAPHICS GEOGRAPHIC'S PSYCHOGRAPHICS
age metropolitan / rural location - attitudes
- gender population density - beliefs
- inconte level - climate • preferences
ethnicity - bobbies
- level Of education BEHAVIORS interests
- marital status - brand loyalties - publications read
occupation distribution channels - TV programs
watched
size Of household purchasing patterns - risk tolerance
Source: DSS Research. Undetstanding Markel
Segmentation, wwu'.d€sresea-rch.com
Market research
Marketers generally divide research into the
two broad categories: quantitative and
qualitative.
Quantitative Research based

on numerical data
• provides statistical information
2 Business • Chapter
• seeks to project characteristics of sample group onto broad population
TYPES OF QUANTITATIVE
RESEARCH
Telephone survey
Online survey
Mail survey
Intercept Survey
Qualitative Research collects open-ended responses

• attempts to understand behaviors and reasons for behaviors
• is interpretive; tnost:
appropriate for determining people's Inotivators, perceptions, and emotions
Source: The Olinger Group, uu•w.olingergroup.com
romotmg a pr uct
Tip Philip Kotler, a distinguished professor at the Kellogg School of
from Management, has said that the. best eompanies don't simply sell products.
Instead, they develop a relationship with cust0"1ers they will ''own" for
the life.
Source: Philip Kotler, Koller on Marketing, Free Press
Top!
Brainstorming a promotional campaign
Promotional channels include:
press releases
Direct mail
Television, Internet, radio, magazine, and newspaper advertising
Billboards, displays on subways, buses and taxis
Gloria: I know we've all
been very busy, but
wc'vc got to get moving
on the PDA calnpaign.
Of course, I'm referring
to our Pocket Wizard,
which I assume you've
all taken a look at.
Marta'. Wc should
probably start with an
announcernent at the
Business • Chapter 3
annual technology conference in Las Vegas. Then we could do press releases ro all the major
publications.
Jeff: Leo and I were just saying that this thing has so many features that it's a natural for TV conunercials.
Leo: And the techies are going to love it. Wc really should do something on the Web.
Marta: Contests probably won't be very effective, but I think direct mail might work if wc partner with another
company offering calling plans or Internet service, Let's not forget there are two target audiences: the business
person and the consumer. I'd start with print — Inaybe get a cclcbriry in a photo — then move to
Jeff: I can inuagine a TV spot set in a trendy café. A group Of young hi-tech types are giving one (If their friends
a hard time for forgetting his girlfriend's birthday, Then one of the guy's friends puts his arm around the forgetful
boyfriend's shoulder, holds out our PDA and says: "You don't need a nielnory if you've got a Wizard."
Gloria: Not bad, Jeff. let's let the advertising agency take a stab at it first. Then if they run into trouble,
we'll send them to you.
Jeff: Sorry about that, Gloria. I got a bit carried away.
PATRICIA NuQEz
INDUSTRY
BRAND
IDENTITY
The value of brand name recognition

Thc Interbrand Group compiles listings of the best-known brand names around the world. In 2002, the
following names topped its annual ranking of 100 of the world's tnost valuable brand names —
l . Coca-Cola 6. Nokia
2. Microsoft 7. Disney
3. IBM 8. McDonald's
4. GE (General Electric) 9.
Marlboro
5. Intel 10. Mercedes
Source: www.'nuvulchanvu•l.ctnn
The power of the slogan

A slogan is a phrase that supports a brand name and a branding Strategy, Slogans should explain a
company's unique position and differentiate it frotn its cotnpetitors. A catchy slogan attracts attention to a
brand natne. A truly great slogan can become a company's most powerful branding weapon. For a slogan to
be effective, most marketers agree that the cotnpany logo should appear with the slogan.
Ten slogans that have captured consumers' attention —
l . Fly the friendly skies. 6. Where's the beef?
2. We bring good things to life. 7. Reach out and touch
3. Twice the results, half the price. someone.
4. Progress is our most important product. 8. Don't leave home without
5. Good to the last drop. it.
9. Get a piece Of the Rock.
10. Mmm, mmm, good.
I 1
•u
Compare market share
WORLDWIDE PDA MARKET SHARE, Q' 2002 WORLDWIDE PDA MARKET SHARE, Q) 2002
297%
How did the product do in the third quarter?
What kinds of market research does your What are the most effective ways to market
company conduct.' a product!
SPOTLIGHT
The World's Largest Focus
Group
Show them the real thing. If your p
Wal-Mart has a surprising appetite for wdghs less than 25 pounds, s
Otherwise. photos will do. Tip:
innovative wares, even from unknown send anything alive or perishabl
is a long process; your product mig
vendors. Here's how to break in. lcm so good in a few months.
O Get face time. The first

rom the moment Sarah Speare and called back for the all-important next her sister
Lesley Lutyens mixed up 'neeting — the pitch to Wal-Mart's pet their first batch
ofYip Yap breath suppli5 buycr. Putman was clarcd.
rrcshcncrs for dogs, thcy kncw tbcy Wal-Mart could sec the product as a fir. had to sell
them at Wal-Mart. Thc product At the meeting thc huycr, Putman is a Of cook-cd
liver, rosemary. rattled Off sales data and marketing
parsley, and green tea extract shaped studies. While the amused the
into little bone-shaped tablets and packaging, he worried that Chomp
arranged neatly in a tin, like Altoids. just too small and unproven.
Dogs go for "They
rhe liver, and their owners appreciate put us off, but in a very positive way,
the joke — not to mention the tablets' Speare says. "We knew wed gotten on
ability to cover up lingering fumes the radar screen." •1b bolster its case,
from whatever unappetizing thing the small company redoubled its
Rover ate before the Yip Yap. efforts to sell in Other outlcts.
Even so — Wal-Mart? Yip Yap
Then caught a break.
WAS an untested product in an manager Of North Conway, N.H.,
category sold by a startup in Wal-Mart called. I lis cLLstomers
Lebanon, N.J., 1.242 miles from kept asking for Yip Yap because
Wal-Mart's headquarters in
they'd seen the product in area pet
Bentonville, Ark. Last year the
stores. This fall Yip Yap finally
sisters' company, Chomp, eked out a
makes its Wal-Mart debut in that
mere $370,000 peddling the treats,
store. If New England dogs suddenly
mostly in pet stores. What were the
bccomc cr'nfident about (heir breath,
odds that the retail giant would
Wal-Mart may roll out Yip Yap to the
interested?
rest of its back-and-ford'
pretty good, it turns out. Gigantic Chomp through is typical for new
Wal-Mart, With 100,000 products launches at Wal-Mart.
already on its shelves, is surprisingly No vendor wants ro homb in the
rcccptivc to new oncs. world's bikgest retailer. On the other
After faithfully fallowing the hand, Wal-Mart's legendary sales
procedure for suppliant suppliers (sce tracking can give manufacturers
"[low to Pitch a Behemoth," right), unique insights into how to hone a
Speare won an invitation ro meet product or marketing plan. A test,
Bentonville% main gatekeeper, the after all, is meant to instruct — and a
Supplier Development Department. lesson from the master merchandisers
Chomp could afford to send only one of Wal-Mart can be very rewarding
person, the company's new CEO, indeed. - CLL_EN NEIJOORNE
Sumner "Sandyn Putman. 'I•he
introduction went well enough that he
got
How to Pitch a Behemoth

O Be revealing. Cough up details on your financial history, competitors' products, and your
promotional budget. Tip: Answer everything on companyS five-page supplier
questionnaire. Incomplete packets will bounce right back to you — postage due.
Count everything.
Wal Mart loves numbers. Tip: Offer sales projections, safety-testing results, and
even an evaluation ot how your product's sales will affect other products sold by
the retailer.
stop tor new vendors Is the Supplier Development Department In Bentonville, but the key decision-maker is thc buyer in your product
category. Tip: If you aren't getting past the gatekeeper, cons& hiring sorneone who has worked at Wal-Mart corporate headquarters to make the
right introductions.
O Try an end run.

Bentonville isn't the only option. Tip: Practice your pitch with the mal stoc manager. That person has a good idea of what the company wants.
Better yet, he or she also has the authority to test new products.
I I
Key Words intercept survey (n.) a process of collecting marketing data from
consumers by stopping them at purchasing locations, such as
shopping malls and grocery stores: One of the benefits Of surveys is
that they allow interviewers to observe consumers' expressions and
allowance (n.) an amount of money that a company thinks it may body longuage.
lose in thc future and includes in its accounts: Wc typically see
returns of 5% of our merchandise from retail outlets, so we logistics the planning, implementation, and coordination of the
generally make ror this os wc project revenues. details of a business or other operation: W'th a project as complex as
ours, the are os important as the octuol work.
brainstorm (v.) to participate freely and spontaneously in a
creative style of developing new ideas and solving problems: After market share a measure of a product•s sales compared
bl_qinsxocming ON afternoon, o few very interesting and
innovative advertising approaches were identified.
I
brand name name given to a product by a company used for
building customer recognition: Sharon usually looks for that to its competitors. often depicted in percentages: At one point.
she knows when she buys housü!d appliances. Microsoft held nearly an 85% of thc software in the uS.
motivator (n.) something that makes a consumer behave in a certain
capture (v.) to take by forte or superior strategy. By the end
way: Summer bathing suit advertisements ore excellent mQ-tiyqrQLS
or the year, Chinese manufacturers hod of the
for consumers to scorch for weight-loss products.
market ror inexpensive watches and radios.
open-ended response (n.) an answer that is more than a simple
demographics statistical vital and social information on a
•yes' or 'no': We insist that o majority of the questions on our
population, including agc. gender. and income level: Having
identified the demographics of Our target consumers, we surveys require open ended responses to give us as much
information as possible about our customers' perceptions.
con now develop a marketing strategy.
direct marketing (v.) Strategy where the seller contacts perception (n.) the way consumers feel about a company or product
potential customers directly: For our particujor needs, the Negotjvc consumer of the company existed for years after
telephone is a better vehicle than e-mail for direct the devastating oil spill.
marketing
promotion (n.) an activity intended to improve sales of a product:
distribution channels (n.) organizations and people involved in a We have o special coch year before the holidays to increase sales
system for moving items from producer to buyers: Preston of on of our seasonal gift itcrns.
Industries could offer more competitive prices if they
consolidmed distribution channels and sold through fewer psychographics (n.) details about the emotions and behaviors of
suppliers. a group of people: The mychnrophirs or the group studied
indicate that they ore conservative and will not respond well to
focus group (n.) several consumers brought together by a some or our products.
company for the purpose of conducting market research:
public relations (n.) the actions of an organization in promoting
Lost year I participated in o was asked to
goodwill between itself and its audience: We ,have incrcoscd
taste ten cffferent kinds of candy Ond to soy which liked
activities since the accounting scandal in an effort to
best. which I liked least, and why.
preserve market share.
generate (v.) to create or produce: Radio advertisements
generate nearly 30% of our soles. qualitative research (n.) information collection for marketing
purposes to determine people's attitudes, opinions.
geographic coverage (n.) the area in which a product
or service is delivered: We haven't hod much success and motivations that are difficult to translate into statistics: Lynne
in increasing tie geographic or our product beyond Sheldon favors auahtotiv.e reseqrch because it gives her o better
New York metropolitan aren understanding or consumers' emotiorwl reactions to her
company's services.
get carried away (u phrase) to get overly excited:
Dont about the newjob until you have the offer. the quantitative research (m) information collection for marketing
solory, and the bcncfits documented in writing purposes with results shown in statistical forms: With o background
in statistics, it 's not surprising that Lou Taylor places o lot or trust in
hand it to (someone) (v. phrase) give credit to quantitative. research
someone for something that was done well: We hove risk tolerance the amount of potential dangerous or unpleasant
to mod-it-to the results someone is willing to accept in order to achieve a positive
product development team. They delivered exactly what outcome: Phil's in traveling to new places is rather
they promised, and in less time thon expected low. so you can expect corcful, conservative behavior when he
chooses vocation destinations.
sector (n.) a particular part of a market: We use TV commercials to
reach the consumer 5.e.<QL but we use advertisements in industry-
specific magazines and journo's to re-och the business
take a stab at (something) (v. phrase) try: I've never played golf. but
I'd like to take-a-stab-at it
target audience / customer (n.) the people marketers are trying to
reach: The Coreet audience for this mogazine is girls under firtccn
of age.
warranty (n.) a written guarantee given to a customer by the seller or
manufacturer for replacement parts or repair service for a stated
period of time: I wos oblc to get my CD player repaired for free
because it was still under
Chapter 2
MAKING THE SALE

Topics
Products and customers
Customer loyalty
Sales strategies and techniques
Objectives
Discussing a sales catnpaign
Describing the benefits Of
customer loyalty
Presenting sales techniques and
strategies
Interpreting body language
Expressions
to pull into; to go up against;
let's just say; to give up; to
do one's homework; Hold
on!
"Selling is easy, if you

work hard at it" a well-
known saying
0 DISCUSSING A SALES CAMPAIGN

Bill: So where are we with the sales campaign for the Falcon?
Eve: The dealers have the product literature. The sales force has been trained. They know what to do from
the moment a prospect pulls into the lot. If the comlnercials work .
Bill: The problem is we're going up against BMW. Thcy'vc got the brand and the younger Customers.
Eve: But we can beat them on price. And we're innovative. Young people like that. Bill:
So you think we can get the younger market, huh? How's the Falcot* performance?
Eve: Not bad.
Bill: [lave you ever driven a BMW' Roadster!
Eve: Yeah, my brother owns one.
Bill: So have you taken him for a test drive in rhe Falcon?
Eve: Uh-huh.
10
Bill: And what did he think?
Eve: Well, just say not ready to give up his keys to the Binuner just yet.
owing your customer

Describing the benefits of customer loyalty
Retention an ongoing relationship with a
customer creates a steady stream Of revenue
over time as the customer continues to buy
products
Related sales selling new products to existing
customers is a gleat source of revenue
Referrals a satisfied customer who
recommends a product to another person
provides the most influential marketing a
company Can ask for — and it's
Source: "The Ecrmomic Facts Customers and Loyalty, "
I larvavd Manage\lemor
A typical marketing budget

Only
of thc typical
'narketing FYI
budget is
Seeking Maintaining devoted to
maintaining NewCurrent current
customers while
Customers Customers 901% is
earmarked for attracting new
customers.
Source: ManageMcntor
Understanding
headlines:
automotive
industry sales
Business Chapter 2 11
a es essen s
Presenting sales techniques and strategies

Presenter: So your role is
Trainee To listen to them. Make them feel comfortable. Build a relationship. Sclunoo:e a little — just
A: kidding.
Schmoozing is good. If it helps build a relationship.
Presenter I'm finding more and more rhat my role is to help custotners solve their problems.
: You should avoid words like problems. Keep it upbeat; use positive language. Make it
Trainee exc icing.
B: And we're not supposed to talk about the price of the car; we should call it an investntent,
Presen right?
ter:
I find that many Custotners are unrealistic about price, I mean, their investment. I tell them
what I would do is
Trainee
B: Hold on there! I suggest that you leave the I out of it. Selling is not about you and your
taste or your wallet. It's all about them, the prospects. And remember, only a small parr
Trainee of prospect's message comes from the spoken word, How do you get the rest of the
A: message?
Oh — body language. I can tell pretty quickly from the walk if he or she is
Presenter serious about buying or not.
: Tell them they look as if they're ready to own one of our vehicles. If they respond to that,
you're ready to close.
Trainec
A:
Presenter:
Presenter: OK, you've Iren selling our brand of
cars for a year now. Tell me what
you've learned abour selling.
Trainee A: I've learned to let the Cars bc the
focus.
Presenter: And why is that?
Trainee A: Because often potential buyers come
in with a pretty good idea of what
they want. They've been on the
Website. They've done their
homework
12 Business Chapter 2
Crandall.
Books
a oring e sa es sty e
l . has done research l . has some idea what l. has no idea what
she wants he wants
2. knows what he wants
2. likes two models equally 2. doesn't like to
make
3. isn't happy about price quick decisions
3. wants to discuss
4. expects to negotiate features and test-drive 3. doesn't want ro
both models be pushed
Hard Sell vs. Soft Sell
HARD SELL (Using urgency appeal) SOFT SELL (Conditioning for long term)
• When PRODUCT is temporary, or of limited / • When PRODUCT has potential for repeated one-
time use: fashions. entertainment. seasonal use: staple foods, non-fashion cloÜ1ing, major clothing,
perishable foods, collectibles appliances
• When SELLER is temporary: door-to-door selling. • When SELLER is permanent: established

telephone solicitations stores, name brands
• When BUYER is temporary, chat is, in an unfamiliar •When BUYER is stable and familiar:
residents area or condition: tourists, travelers, newcomers. Of the area. experienced,
mature adults inexperienced I immature buyers
• When a sense of CRISIS exists: a real or • When NO CRISIS exists: ongoing product or imagined
emergency, time limit. or deadline service offerings, business as usual
• When SUPPLY exceeds DEMAND: surplus • When DEMAND exceeds SUPPLY: shortage
situations situations
Source: Rank, Persuasion Analysis, uru:u.'.gowt.cllu//xa
AIDA: A Formula for Selling Success

AIDA, a basic formula for selling, stands for Attention, Interest, Desire, Action. Before salespeople
can get customers to buy products and services, they have to get their attention. In tocla•b world, where
people are constantly being bombarded by advertising and product information, it takes more and more
Business • Chapter 2 13
imagination to attract and hold people's attention. Source: Rick Crandall. Ways to Market Your
Services, McGraw-Hil /
Tip from
•'Selling is fifteen percent knowledge aud skills and eighty-five percent
the Top! attitude, values and enlotional control."
Rtm mtcmatinnal sales and author, Selling October
Interpreting
Source: Roberi Heller and Tun Houl!e, Essential Manager's Manual. DK Publishing
Electronic Business Cards

Every hour millions of business cards change
hands around the globe. The next time you
reach into your pocket to present your card,
make it interactive — an iMediaPro
Multimedia Business Card. Packaged in an
elegant Case with custom print work, this
full-sized CD-ROM utilizes text, graphics,
anilnalion, photographs, audio and video to
"tell your story." By handing out a
multimedia business card instead of a
traditional business card, you'll deliver an
exciting interactive message about your
company while simultaneously directing
potential customers to your Website and courtes•i
iMeIliaProTM
product offerings.
I•
Chapter
Check
Now you can
loyalty
strategies Interpret body language

How does body language play a role in an
effective negotiation!
• Chapter 2 15
SPOTLIGHT E XC E RP T S F R o M B u S 'N E S S 2 . O
What Works
Selling Salesmanship Here's
Hopkins
How
Sales guru Tom Hopkins has seen Gets to Yes:

technologies come and go, but what Ask questions that
ultimately moves the goods never changes. don't leave room for
no. "l could visit with
YOU today at 3, or
would tomorrow at 9 be better?' om Hopkins
has been teaching \V11a' lhcy fail realize, Hopkins says, is salespeople how to sell since the days rhat selling is still a matter of listening well,
Never use the word when customer rela:ionship finding specific needs. and, sometimes, "price" or "cost." managcrncnt meant tickets
to Super knowing when to shut up and close the sale. Say "investment," Bowl VIL His sales career starred in 1963, at Technolog is
simply an Take voiceage 19, when he went to work for a real mail, which cxlols for its efficiency estatc agcnt wearing a silver-striped band You
can leave a lot of messages in a short Never ask for "an
Over from high school. (He Lime if you when little chance of appointment." It suggests didn't yel own a suit.) After
selling a record- gctting through to anyone. a serious time commitment. Say breaking 1,153 homes in fivc years in Simi hangs up nvany of
his students, "I'll be in the area, and I was Valley, Calif., he decided that a more however, is What 10 say a prospect's hoping I
could just pop by and visit.' inrcr51ing challcngc would be teaching mail beeps. Hopkins's "Say that
Others how to do What did. has given a Of Don't ask "May I help
'lhrcc decades and 3,900 seminars later. to contact and kcvp on calling until you you?" They'll reply "We're just
rhc is-year-old Hopkins is a lcgcnd arnong get a chance co meet in person." Moteofrcn looking." Say "Hi, I'm so-and-so.
salespcoplc, In that Hopkins has than not, Hopkins says. the decision-maker Can you tell me what brought you
learned that whar works in sales hasn't will condudc, "Oh wdl, I'll have to talk into cur store today?'
changed much. What has changed, however, this guy if I want him e.•er 10 quit leaving me
is his students' belief that technological fixes messages." In Other tcchnolcw helps,
Isolate areas of
agreement.
— sales-forcc automation, say, or customer- but it; not what gets your in the door. Il's You need a lot of little yeses on
relationship management software — can that ancient but awesomely effective CRM the way to the big yes.
replace the proven techniques of selling. known as - LARDNER
Get Inside Your Customer's

Head
A new speaker technology creates laserlike
audio messages for an audience of one.
omeday soon might start a new technology HypcrSonic Sound (HSS) spcakcrs emit ultrasonic at 100,000 cycles Fr
hearing sales pitches emanating from rolls can focus messages at highly specific targets; second — a wave-lens." beyond the hearing
of toilet paper and cans of tuna. Or at least pcoplc outside the beam don't hear a dling. rangc of humans. W%cn lhc ultrasonic sound
that's how it will seem (o unwitting "Ilk as ifthe sound is in your head," boasts travels rhrough air. ili convcrtcd into
shoppers. Much the way a theatcr spotlight Elwood Norris, CEO of San Diego-based frequencies humans can hear, even as (he
only the in its path, speakers equipped With American which makes the system. HSS resulting "'und beam maintains its pinpoint
accuracy. By early 2003, vending machines
equipped with HSS speakers will Begin
transmitting effects like rhe sound of fining
soda. Meanwhile, IKS Media & Technologv,
a company that supplies sound systems co
retail and food chains, plans to install HSS
systems al stations to up advertisements to
folks Handing in front Ofthe putnps. And
that noise har off in the distana•? Ibat's the
cash
'*isler going "ka-ching."
— NANCY 'INHART
18
Key Words savings were realized, prices for our DVD players
body language (n. phrase) nonverbal cues that show what a

person is thinking or feeling: Æthough he SGid nothing, could
ten by his bqdu]qnguggg Chot he was very angry.
boost (v.) to increase or raise (e.g.. sales. production. or
prices): We hope the new morketing campaign will Business
soles during a typically slow time of year. product literature (n. phrase) promotional material prepared
by a company for potential buyers: The contains useful
brand (n.) the name given to a product so that
information about the different models available.
customers will readily and easily recognize it: The
Sherman family has bought the same of soap tor prospect (n.) a potential buyer: If you treat 0 like a
the lost ten years. valued client, he will be more likely to feel cornrortoble and
purchase your product.
close a sale (v. phrase) to reach the final step of the selling
process in which a contract is signed or a deal is finalized: The pull into (v. phrase) to drive a vehicle into a place:
client demanded so many changes to the contract, that the thc porking lot so we can look at the mom
saleswoman wondered if she would ever
referral (n.) a recommendation: A from a trusted friend is
commission (n.) a fee or a percentage of a sales price more convincing thon o television commercial.
paid to a salesperson Or agent: Our soles team is
motivated to Seit os much product as possible each related sale (n. phrase) a new product sold to existing
month because they ore paid by commission customers: You can often increase by
simply educating customers about other products you
customer loyalty (n. phrase) a company strategy of offer.
building strong relationships with customers so they
repeatedly purchase producß and recommend them to retention from retain (v.) to keep or to hold: Blanchard
Industries has an cxccllcnt customer record which they
others: Acquiring customers is difficult and expensive, so
otthbute to superior customer service Ond competitive
it is wise to focus on customer improving to retain pricing
and expand sales.
sales campaign (n. phrase) a series of evcnts or activities
do one% homework (v. phrase) to research or prepare in
developed to increase sales: The new cgrnpqien is targeting
advance: It is best to dp one's homework before making a
the youth market with its emphasis on rock Stars and their
large purchase such as a car Or a home in order to get a good
music.
deal. give up (v. phrase) to surrender Or relinquish: Mark his
Saturday golf outings to spend more time with his children. sales rep(resentative) (n. phrase) a person whose job is to
persuade people to buy a company's products: The
go up against (v. phrase) to compete with: We Ore gQiog-
vp C5.t the best in the industry with this new product. from several industries met ot the conference to discuss soles
techniqucs and strategies.
hard sell (n. phrase) the practice of using extreme
pressure to persuade a customer to buy something: to chat pleasantly with someone for
The hard sew didrft work with Tina. The harder the a friendly relationship: He likes to with
salesman pushed, the less interested she became in clients before taking business. a sudden
the product drop in price, value, or quantity: in sales
this winter.
hold On (v. phrase) to stop or wait: a moment;
I'm not yct ready to respond. soar (v.) to fly upward rapidly. as a bird: Demand for
let's just say (expression) a phrase used to say mobile year.
something indirectly Or unofficially: I'm not allowed to
announce who wc hired quite yet. but it's the practice of encouraging and persuading,
the internal candidate that we all expected to get the job. but not pressuring, a Customer: Because the customer
owned several other Ferraris, the salesman used the with
negotiate to deal or bargain with another person in her.
order to reach agreement: Unhappy with the rctajJ
price, the customer 0 discount before making
the purchosc.
plummet (v.) to fall or drop suddenly: Once
production increased and manufacturing cost
• Chapter 2
15
20
Chapter 3
MANAGING THE NUMBERS

Topics
Budgets
Financial statements
Pcrfonnance evaluation
Objectives
Talking about budgets
Discussing the budgeting process
Discussing financial reports
Summarizing an interview
Expressions
Pressure on someone; one
u.uy or another; get one's house
in Order
"You can't manage what you

don't measure." a business
proverb
O TALKING ABOUT BUDGETS

In the executive office of a pharmaceutical company
CEO: As you know, after last quarter's results. the PRO'arcl is pntting a lot of pressure on Ine to get costs
down. I'd like to ask all department heads to revise their budgets.
CFO: What do you have in mind?
CEO: Wc need thetn to reduce their spending by ten percent.
CFO: And if their budgets are already as right as they can get!
CEO: Then they're going to have to look again. The cost of each and every drug we're developing tnust be
cut by ten percent — one way or another.
CFO. Faster government approval would help a lot
• Chapter 2
CEO: I know it would. But let's get our house in order first before we start worrying about whar the
govermnent 's doing.
22
rscussmg e u geting process
Definition: budget
A budget is
a. a forecast Of the yea€s financial results
b. a plan of the year's work
c. an expression of upper management's objectives and priorities
d. a control and measurement tool
e. all of the above
Source: Robert G. Finney, Essentials Of Business Budgeting, Amacmn
Budgeting strategies
TOP-DOWN BUDGETING
Step I A company's upper managetnenr establishes
specific financial goals, such as revenue,
profit and expenses.
(0 Step 2 Dcpartment heads develop budgets that support ttiR

manageluenl's priorities and allow them to meet its
goals.
Step 3 Management reviews the departtnental budgets and works
with departlncnt managers ro finali:e theln.
BOTTOM-UP BUDGEIING
Step Department managers prepare IMIdgers that reflect
the needs and goals of their departments.
Step 2 Upper managetnenr reviews and
consolidates the departmental
budgets to creme an overall
company budget.
Step 3 Management directs departments ro modify their budgets,
as needed, to meet the con.pany's objectives.
Source : "Finance Essentials. "
ManageMent0r
• Chapter 3
THE BIG PICTURE — keeping an eye on the economy and how your company
When preparing a budget, it is responds to it
itnporranr ro know your — keeping up with the latest trends in your industry
company's strategy, its position
— getting to know your company's culture, that is, what is
in its industry, and its philosophy
toward budgets. You can learn valued by senior management
what you need to know by — using SWOT analysis (SWOT = Strengths, Weaknesses,
Opportunities, and Threats to the company)
Based on "Finance Essentials. " by Kremer, Harvard ManageMentar
17
Iscussing ancia reports
Forecasting from financial statements
Source: Inc., Annual Report
The essentials Of financial reporting
Statement of Income (a.k.a. the P&L Statement) shows revenue, expenses and
profit during a given period Of time, typically either a quarter or a year; shows
how much money the company spends to make its profit in brief: tells you
whether the company is making a profit
Balance Sheet shows the company's financial position at a given moment by

comparing what the company has invested in its business to what it owes its
creditors; the difference in the two numbers is the owners' equity; the balance
sheet illustrates this equation: ASSIEIS = LIABILITIFS + OWNERS' EQUITY in brief: tells you how well the
company is using its assets and managing its liabilities
Cash Flow Statement shows how much cash is coming into and going Out of the contpany during a
given period Of time; it also details how rhe company spends its cash in brief: tells you whether the
company is turning profits into cash
I•
Just the facts

Developing new Inedications is a long, complex process, involving extensive periods for research,
testing and clinical trials. While 'he public cries out for less expensive drugs, it insists, of course, that
medicines be safe and effective with as few side effects as possible. Consumers in the U.S. and critics of
pharmaceutical companies dernand lower prices for medicines, but the facts paint a challenging picture
for the industry —
— it takes 10-15 years develop a new prescription medicinc and earn government approval
— the average Cost of bringing a new drug to market: $802 million
— 15 years ago, the cost was just $318 million (inflation-adjusted dollars)
— of cvcry 5,000 medicines tested, roughly five will undergo clinical resting
— of thusc five, only one will eventually be approved for use
Source: Tufts University Center for the Study o/ Ihug Development , press releases
Business Chapter 3
pharmaceuticalindustry
— [low are prescription drug companies

faring in rhe economy? Why!
— Why is the prescription drug industry
considered a difficult business
environment!
— What arc drug Companies doing to keep
their balance sheets under control?
— What is the U.S. government
investigating? Why!
Did you hear the one about the accountant?

A business executive was interviewing candidates for a managerial position.
In the course Of the he asked each applicant: "How much is two plus
The first applicant, trained as an engineer, puned out his slide rule and found the
The second candidate, trained as a lawyer, noted that in the case ofNewton vs.
The third applicant was an accountant. When the executive asked him how
much two Plus two was, he leaned across the desk anci whispered: "How
much do you
1
I
UNDERSTANDING CULTURAL DIFFERENCES
Relying solely on the "numbers" to
develop a business plan can lead to
what is known as paralysis by
analysis" or, in other words, the
inability to collie to a decision.
How much do you rely on data in making
decisions?
Is there a place for judgment and
intuition in developing a business
strategy?
What is your contpany's philosophy nn this.'
n Evaluating a company*s
performance
The Balanced Scorecard
Wouldn't it bo great to have u system that would evaluate a
The most common ways to measure a company's performance frum a number ofdifferent
company's performance: und not j'Lst by looking at tho hottnm line?
Robert Kaplan and David Norton have como up with such a
system. it's called the Balanced Scorecard performance Measurement
• Sales growth (CAGR) SYSLem. It includes financial measures. which examine the results of
changes impletnented by a contpuny. as well as operational measures.
• profit growth (pre- post-tax) such AS customer satisfaction, internal processes, and organinution•s
• Financial ratios growth) nbillty tn learn and improve.
In order for the halanced scorecard approach to work. it's
Based on "The Balanced Scorecard: Measures that noeTssary to translate a company's strategy into precise goals and
lhte perfonnance" S. Kaplan measures. •Illis allows managers monitor those measures us they try to
p. Mmon, Harvard Business Review. achieve thoir goals.
What's the bottom line?

Accounting expressions and slang:
the go
bottom be
line: lly
up
:
crunch the
go
numbers:
bu
st:
in the black:
"Thank you. Bentley. We get rhe picture." in
the
red:
Business
Chapter 3
apter ec
go broke: show a
02003 The New Yorker Collection: from

cattcvmbank.com. All Rights Reserved. become bankrupt
20
the last entry of a balance sheet
make calculations; tally results show a profit •
Now you can .
Talk about budgets and the budgeting process
What is purposeof a budget?

What is your company's approach to budgets?
Discuss financial reports
Consolida'ed Statement of Income
What can you Say about this co:upany based on its income statement?
What other reports would you like to See to evaluate the counpany's performance?
Why?
28 Business
Chapter 3
Summarize an interview
What did the experts in

the industry have to say?
I•
Parkcr why she was latc will' a piece •
SPOTLIGHT ExcERPTF he expected. She replied: "Somebody
was using the pencil."
Putting se
tcchnology, or ca
projects into hib
ROM Now that is thrift. Aher a decade of

easy riches. time to dust off a
•
spring.
Cutting p
fundamental businesslike virtue.
outside
striving to do more with less. You
areas Of direct p
could argue that prudence isn't a
sales.
virtue in thc middle rush. You've got
12 Management
What isn't evi
10 spend money to tnake money. Hitc
through such a lau
ahead Of demand so as 10 be ready
exertion
when it cnmcs. The early bird gets thc
Remember, fruga
worm. The worm has curncd.
Tips for Slow business shows signs Of a

rebound, it's clear that the future no longer
belorws to the irrationally exuberant, hur to
end. Leaders a
company may f
heartbreaking ch
costs in line with
companies demonstrate, quarter in
Times and quarter Out, the ability to produce and

the same lime th
more With0Ut burning through people, preserve their int
capital, and other resources. Any dunce can fund grow
spend a fortune (thus doing more with ask for sacrifices, y
Slow times call for new more). Any moron can order across-thcboard a Vision —a Sto
cuts (doing less With less). grand strategic Where it's going,
strategies and some very old challenge is to use times like this to
transform a company into an organintion
all this pain tn g
can't cxpcct tn
spending habits. that knows in its bones how ro do more with

less — not just now, but forever.
some fundamenta
So how do you begin? Harvard

Business School\ Rosabeth Moss
Get your n
ne day in the 1920s, • Unbundling the prnduct/service mix
and ROS, the skinflint Of a charging for things that Once KanteT has assembled a checklist of right
w•crc free. magazine called the New Renegotiating effective ways to bring costs down Prosaic as it so
purchasing contracts, without seriously hurting a business. frugality unless yo
Among thcm are: yourself. That goes
Yorker, asked staff writer Dorothy Forming partnerships to share
and operating num
costs. Slashing travel, consulting, and
when sales rise ev
entertainment budgets.
Street
Speeding collections and "whisper numbers" set expectations I
high, all too telnpting to play
Key Words around, figuring you can make it right
next quarter. AS operating
measures, in the Inng run, only three
Thc first is frce cash flow — that is, asset (n.) something
how much cash a busincss producesowned by an individual or
over and above whar it needs tobusiness that has value or can
operate. "Ille second is economic earn revenue: The firm's
slowing payments. inc/udc several high-rise
office buildings in the business
2.0 district of the city. balance
sheet (n.) a document
summarizing the overall
financial position of a business,
often at the end Of each quarter
profit or economic value added — net npcrating profits in excess of thc and year. The company
cost of capital. numbcr is productivity. performed well lost quarter as
Productivity is output divided by input. If it improves, you are doing more shown by the balance-sheet.
with less. Wise leaders know that labor is only one input, and if all you sec balanced scorecard (n.) an internal
is labor cost. then all you]l do is lay pcoplc off. That can kill a company's strategic management system to
future. evaluate performance from
different perspectives including
both financial and operational
Help people understand that thrift is a measures: The
allowed our compony to clarify our
vision and strategies Ond then
translate them into action for
creating future value in Customer
source of profit relationships and more efficient
In (he casc Of Mutual Funds company Vanguard Group, low cos( hclps Organization. wide processes.
give them a brand identity in an industry Where t110S1 entrants have
nonc co speak Of. Employccs understand that that's why Vanguard can bottom line the financial
compete with markering machincs likc fidelity and Merrill Lynch. figure showing a company's
total profit Or loss:
Reducing development
People should get more, not less costs will help to improve
Stock options, stock ownership, profitsharing, gain-sharing — sotnc sort the company •s
of connection between company coffers and employee must
bottom-up budgeting (n.)
be made. The more dircct, (bc better. Eliminate the galling gewgaws of
developing a budget
privilege
Out go the executive parking spaces, country club menihershivys, ctc. —
beginning with
forever. inhibit the fourth and must powerful way to build thrift into the department managers' needs.
very bricks Of business then consolidating these
needs for final review and
approval by upper
Get everyone involved management: The CEO
Charter six, eight, a dozen crossfunctional teams. Assign them believes thot understanding
topics like travel, energy, purchased materials, or distribution. the needs of each deportrnent
Then, the hard parts: Implcmcnt at 80 percent Of what they is vital. so she uses the
recommend, and don't stop when business gets better. bottomup budgeting
nrift is more than tactics. W%en it all works — the business model, opproach.
the reward system, the institutions — part of
your budget an
—THOMAS
organization's detailed plan
of how it will spend money
during a specified period of
30 Business
Chapter 3
time: Following our closely win allow us to achieve our strategy (n.) a plan for achieving a
financial goals. goal: We must create a srgteu for
reducing expenses.
business plan a document detailing management's strategies, as well as SWOT analysis a system for
expected expenses. revenues. financing, etc.: The managers will
need to provide a five-year in order to get the bonk loan. examining a company that
focuses on strengths,
CAGR (Compound Annual Growth Rate) (n.) a mathematical formula to weaknesses, opportunities. and
show annual compounded yields vs. simple averages: The is o useful
statistic for evaluating how companies of different sizes have
threats: We will carry out o
performed during the same time period. SWOT ono!ysis before creating
the budget for next year.
cash now statement a document giving details of money coming into
and going Out of a company during a specified time period: The shows top-down budgeting (n.)
that our customers ore paying our invoices on time. developing a budget beginning
with upper management's
equity (n.) the capital a company has from shares (as opposed to
debts): rhe strong stock market will ollow more companies to use financial goals, which are then
equity insteod of loans to finance major purchases. communicated to department
heads as they create their
departmental budgets: The CEO
financial statement (n.) a document showing the financial and CFO hove o strong vision
position of a business, Often at the end of each quarter and Of the direction they wont the
year: The company is {Ote sending its fingngUL5.tgr.ement5 to company to
investors this quarter. move, so they
use the
opprooch.
trend the general way in which a

situation is changing or developing:
The return-oninvestrnent figures
show o positive trend in the
pharmaceutical industry.
I•
forecast a description of expectations for the future based on current
information: It is too early to make accurate about consumer demond
for the new product (v.) to make a statement describing expectations
for the future based on current information: We growth of 35% for
next year.
get one's house in order (v. phrase) to improve the processes and
workings of an entity or organization: We
need to eetguc.&use-in-udet before the government inspection team arrives
next week.
income statement a document showing details of money earned
and spent during a particular period Of time: The income
statcr7acr2! shows net income this year fell sharply compared to last
year.
liability money a business os•.'es: The business' include o

bank loon and taxes
one way or another (expression) a phrase used to say that if one method
does not work another will be tried until a solution is found: One way or wc
have to collect 011 the dato for Mr. Anderson's presentation by the end of
the day. P&L (profit and loss) see definition for income statement
put pressure on (v. phrase) to force someone to do something: hove several
reports to finish, but my supervisor has been putting pressure on me to
complete this one first
Chapter 4
MANAGING PERFORMANCE
Topics
Employee conunitment
Retention of talent
Management styles
Performance evaluations
Recruiting and promoting
Objectives
Discussing ernployee cotnnlittnent
Explaining employee retention issues
Describing vx•rformance evaluations
Summarizing hiring and promotion practices
32
Expressions
from scratch; to take off; to take the plunge; to jump out at Someone; to get up to speed; a
tough act to follcnv
'What gets rewarded gets done."

a well-known business saying
n AN UPCOMING PERFORMANCE EVALUATION

Lena
: I just had my performance review.
Mark: How did it go!
Lena OK, I guess. When are you going to have yours!
: Next week. Bur you know, Lena, something I've been meaning to tell you. I'm thinking of leaving. Really?
Mark: Why?
Lcna: ltls just that an opportunity ar a start-up company has come my way, and I really like the idea of
Mark: being part of building something from scratch.
That seems a little risky in [his ec01101ny. What if it doesn't take off! You could find yourself
Lena: without aHighjob in no tilne al all. Loyal
I know. There's a lot to consider bcforc I takc the plunge. I don't think I'll bc making any decisions
Mark: before my review.
Lena: so
mayhe I need
to tell your
boss how
important this
On'* going to
/ Walker information.
be — for both Source;
of you.
Discussing employee Commitment

Assessing employee
commitment
teuu'.hudson.org, "Comminmnt in the Workplace.
1999 Employee Relationship Report Benchmark Study "
soum: Taylor Nelson

Employee Commument
CJ
Building employee commitment
True employee commitment is something managers and companies should strive
for. Committed employees — arc fully engaged in their jobs care about achieving
good results — all the time
• arc self-motivating underestimated. The cost of replacing employees has
motivatc others by their been estimated at twice their annual salary. This figure
example generate ideas takes into account, of course, the loss of employees'
for the company knowledge and Skills, bul also managers' titne spent
xplokiiig employee retention

Considering retention from the employee's point-of-view
interviewing, work put on hold while replacements are
• welcome challenges found, and lost contracts or cuslotners.
persevere in difficult Source: Detelopment Dimetui01Ls Intemational,
times WHY EMPLOYEES STAY good relationship with Supervisor
• are "ambassadors" for • job security

the cotnpany • job satisfaction (meaningful role and
• make the company's responsibilities)
mission their own • compatibility (workload, corporate culture)
sense of belonging
Adapted from "Retaining Valued Employees , " James
Examining management styles

WHY EMPIOYEES GO
• poor relationship with supervisor

• insecurity (e.g., new management)
Costs
• job dissatisfaction (insufficient Or
inappropriate responsibilities)
COS"
• incompatibility (inability to juggle
demands Of work and home)
Travel
The New harke-r • no sense of belonging and Butler, I
Collection : from
cartooninnk.eom. All ManageMent0T
Rights Reserved.
Turnover — the process of losing

employees and hiring new staff to
replace — can be a costly result of not
building commitment. While a certain
amount of turnover is to be expecled
(and is actually desired for somc
positions), its costliness should not be
34 Business
Chapter 4
ManciJ.
Supervisor
Considering 360-degree feedback

Multi-rater or 360-dc.gree assessment surveys
provide input on employee performance from
several perspectives. A typical 360degree
assessment would include input from an employee's
supervisor, her peers, her subordinates and possibly
her clients and/or vendors. The term 360-degree
refers ro the fact that the feedback comes frorn
above, below and around the person being rated.
Some HR consulting firms recommend not to use
multi-rater assessments for performance review.
Rather they suggest that this tool be used as part of
on-going professional dcvcloprncnt.
Tip from "Companies Illust find a way to know who their best [en.plnyees] are,
the figure nut what those employees want and need, make sure that they
are getting • It —and make snre that they know that they're getting it."
Harkhu, President and CEO of Linkage, Inc., a ofrrrpuzatiorull deleL*ment c•ræe
cducation lm_wams , predicts and serticcs
Subordinate
Procter & Gamble is a manufacturer of consumer goods, such as soaps and detergents. hair-care products,
toothpastes and snack foods.The company markets some 300 brands in over 160 countries. It employs nearly
102,000 people in approximately 80 countries.
n Examining P&G's recruiting and promotion practices

According to its Website, "P&G people arc our greatest asset." The company's recruitment and promotion
practices illustrate this claim. Procter & Gamble —
• brings nearly all new hires in at the entry level recruits from over 100 colleges and universities each
year (not just the most prestigious schools) recruits a diverse mix of employees
• typically promotes from within (virtually all management hires and Senior positions come from
within rhe organization, including the top-level executive positions)
• uses a four-stage, Web-based recruitment process ( l . application 2. questionnaire 3. test 4.
interview)
• offers on-the-job, formal classroom and Web-based training programs
• hires over 500 interns a year provides performance feedback twice during summer internships
productiv
3. Do you agree with Joe's advice for Julie Choi?

might the company have done to keep Rich Tobin?
A day in the life of an HR director (Part 2)

You recently hired a Senior Recruiter who is doing very well. Unfortunately, you've just been told one of
the following:
a) a budget reduction requires you to reduce staffing costs starting with the most recently hired
b) a hiring freeze has just been announced and there isn't enough work for the Senior Recruiter
c) the new Senior Recruiter has unexpected family obligations that will prevent hill' or her from working full
time; the company needs a full-time person in this position What will you do." Can you find a creative solution?
What not to say in an interview

As part of a survey on recruiting and conducting job interviews, several husiness executives were asked
to share unusual things they had seen and heard when Conducting job interviews. Here are
some of the rcsponscs — — It may seein from my resume that I'm a job
THINGS INTERVIEWEES HAVE SAID:
hopper, but I want you to know that I have
never left any job voluntarily.
Business I • Chapter 4 37
— I don't really want the job, but the Feel Trapped
unemployment office wants proof that I'm

looking for one. How does your company handle performance
assessments?
— What job am I applying for anyway?
THINGS INTERVIEWEES HAVE DONE:
Candidate stretched out on the

floor to fill out the job application,
Candidate arranged for a pizza to be
delivered during the interview.
During the interview, an alarm clock
went off frotu within the candidatc's
briefcase. He took out the clock, shut it
off, apologized and said he had to Icavc
for another interview.
Chapter Check
commitment
Now you can .
How
committ
ed to
their
jobs are
evaluation
workers
in the
U.S.:
Subord
Why do employees Stay at a company? Why do

they Icave!
Summarize hiring and promotion practices
How does your company's practices compare to others'!
21 % of small businesses
offered raises during the first
— NFIB, MAY SURVEY
Positive Feedback.
quarter, despite the recession.
mployces and managers may have feedback thal is gentlinc, rcwarding, and Empathy is crucial delivering noldiffercnt
lcvcls of experience, hut they morivaring. IF (here is room to improve sn-plcasant f'ccdhack. people Who fed worry about the
samc thing: " HOW what he is currently doing, point how forced to defend their self-esteem are less can I do a better job?' To
help you change and get better. Consistent and receptive. FOCVIS on specific hchavior and help them, wc turned to Kathryn
honest feedback in small doses throughout remember [he goal is to reset direction,
vice president at the Hay Group, a the year can alleviatc the need for a highly not to point out inadcquacies.
consultancy that organintioms charged annual review. Set dear incentives for a job well done. It
people. Performance ruie.vs, she says, should • Employers usually think they clearly makes sense that stars should get signifi-
not bc a single, dreaded day at the end of thc articulate their goals to employees when. cantly more than poor petfornjcrs, hul
year, but an ongoing dialogue incorporated in fact, most don't. Sharing your targets rarcly docs (hat actually happen.
into the company's culture. Hcr advice and ambitions — and reinforcing lhosc
Employees conqantly want 10 know with regular mccrings and
Where they stand in the company, and stacks the deck in favor of your employees'
It's Not About the
Money
good managers should clue [hem in living up to expectations. Employces want Actualty, not al! atnut the than regularly. If
someone is doing a good to do the right Ching, bur can do so only if half of the re$0ndenls to latest mllne surny job, give him
immediate, specific they know what the right thing is. cited the opputunilies available the VMplace as fie most imgxrtant
reagl '0 get out ot each morning. Paycheck size
Career Immobility came red cn the priority list, by p.'ial

colleagues and a tricqdly manager. Bosses corre and bosses bul 20 readers beeve thX p,ork its own lyst reward. ouve heard the conventional
wisdom: — virtually unchanged from an average tenurc
Job security is history. is that's bounced bctwccn 3.4 and 3.8 YQr.S since BUSINESS 2.0 READER POLL dcad. Wcll, don't
helic•ve i '. Overall. 1983. new then? Workers 35 and older What single factor most heavily
American employees aren't jumping arc moving around Ihan 10. influences your job satisfaction?
from job 10 job any more rhan thcy did 20 And the historic dihQcnce in tenure benvcen The work do is Getting along
colleagtR•s:
median time for a worker to interesting wen witl my
I•
Key Words
act [tough to follow] performance: No onc in our performance assessment / evaluation I review
(n.
department wanted to apply for John's position after he left the phrase) a meeting between an employee and a
supervisor to
company. He's o tough to follow; no one felt qualified to fill discuss work results, goals, and future plans for the
his shoes. employee's posiuon: The process has been commitment (n.) an expression of strong
intention to do rcviscd so that employees learn how to build on their successes something or behave in a certain manner: Our
firm has mode and examine their shortcomings.
o to innovation by fostering creativity in employees. persevere to continue trying to do something even compatibility
the ability to work Or live together in though it is challenging or difficult: Tom in his efforts to
harmony: The new employee feels o high level or improve his performance even though his supervisor was not with the values
Ond goa's of the firm.supportive.
corporate culture (n,) the ideas, attitudes, and beliefs praise (v.) to give positive feedback: my employees shared in an
organization: Placing top priority on customer when they do excellent work So they know that they are service Ond
satisfaction are key values in the of appreciated and valued.
our orgonizotjon.promotion a move to a better job: With his promotion direct report the person a manager supervises
and is BMI got o raise Ond increased responsibilities.
responsible for: The director of the finance deportment is we" recruit (v.) to seek and attempt to attract candidates for known for
keeping his direct-reports motivated and productive. employment: Wc visit the best universities in the area every from scratch
(expression) to make or create something year to new graduates.
without using anything that was previously prepared or sense of belonging (expression) a feeling Of being developed: Bill
Gtes and Poul Allen buift o software empire connected to and part of a group: Orientation sessions have been
designed to help new employees quickly feel c get up to speed (v. phrase) to work in order to reach the be'onging to the
company.
appropriate or necessary level of knowledge to perform in ashortcoming a weakness, fault, or lack: He balanced his job: The new
trainee wp to speed in three weeks, which is ShQ(tCQ.mings os o salesperson with his strengths as a specialist in half the time it
usually tokes our new employees to learn the the industry. essentials of that particular position.
human resources (HR) department (m) the department : in an organization: The company expects to increase by this
organization focused On managing. training. and supporting year.
employees: Please cal/ HR for questions concerning medical
benefits. subordinate a person in a lower position and with les
staffing (n.) from staff to provide the employees of an
authority than another in an organization: The division intern (n.) someone. typically a student, who works in a job
manager is responsible for overseeing nearly forty for a short time to gain professional experience: Because take
Off (v. phrase) to suddenly become successful: The new summer is our peak season, we typically hire college to
Internet company soon after several articles about it help handle the increased soles volume.
appeared in the major newspapers. jump out at (v. phrase) when something is more noticeable take the plunge (v.
phrase) to make a decision to do than everything else and is impossible to ignore: The red something risky: finally
decided to take the plunge and start envelope jumped out at me frorn among the white envelopes my own
piled on the desk.busjhess top-notch (adj.) the very best: We
mission purpose: goals: Our mission is to provide excellentare prepared to pay top service at an affordable price.r.QLn.Qtrh
talent
salaries for
motivate (v.) to encourage Or provide a reason to dotrap (v.) to catch or hold in an unpleasant in herjob. She situation wanted with to
quit no c easy escape: Layla feels cropped something: The odditionol training and resources we're providingtirne ago, but she has had no
luck finding another job. long will employees to work morc emciently. turnover (n.) a figure or ratio that represents worker
never-ending (adj.) seemingly continuous: without end: Myof time: Due to the Jong
replacements over a given period work is — no matter what time I start and finish hours. the low pay. and
the cfffcult working conditions, the each day, there is always plenty to do the next day.
turngyet at Be!tek was very high.
Chapter 5
BUILDING CUSTOMER LOYALTY

Topi
Customer loyalty
The service-profit chain
Corporate culture
The service process
Objectives
Describing the service-profit chain
Analyzing customer value
Talking about corporate culture
Commenting on service delivery
Expressions
on board; you name it; to roll
up One's sleeves; to pull
sornething off; guess again; to
bc going places; in a nutshell
''There is only one boss:

the customer."
Sam Walton, founder ofWal-Mart
n CUSTOMER SERVICE STARTS AT THE TOP

An inteTview with Dan-en Stephenson, president and CEO of start-up airline Cloud Nine Stephenson:
Custotner service srarCs with me — it has to in this business.
Interviewer: How often do you actually fly on one of your planes!
Stephenson: try to take at least two flights a week.
Interviewer: How do you spend your lime when you're on board!
Stephenson: I spend a lot of tilne talking to the customers and crew. I start at the back of rhe plane, talk
ro the flight attendants, then go up front and announce to passengers that I'm on board
and that I'll be piL+ing through the cabin to help serve snacks.
Interviewer: Do you speak with Inany of the passengers!
Stephenson: actually speak 10 every passenger — I collect a lot of business cards. I like to find out how my
Custolners are reacting to our service. I almost always end up with a notebook full of
comments, suggestions —and a few complaints.
43
Interviewer: How do you handle the complaints!
Stephenson: Well, I start off by listening.
Based 'm Jennifer 's interview of founder CEO David Necl•man, Fortune , February
g oy tyto pro t
Describing the service-profit chain
Understanding the links in the service-profit chain can help a company develop cotnprehen.sive
srratcgics for lasting competitive advantage.
The service-profit chain describes rhe relationships between elnployee satisfaction, customer loyally, and
profitability.
l. profit and growth are stimulated by Cust01ner loyalty.
2. Loyalty is a direct result of customer satisfaction.
3. Satisfaction is largely influenced by the value of services provided to a customer.
4. Value is created by satisfied, loyal, and productive etnployees.
5. Employee Satisfaction results from high-quality support services and policies that enable employees to
deliver results to their customer.
Source: James L. lesket! et al, "Puttmg the Service-profit Chain to Work." Harvard Busmess
Analyzing the value of a customer

Cusromcrs come and customers go. When they go, so do a company's long-term prospects for growth and
profitability. The chart below demonstrates the value of one customer to a company over a five-year period.
Year l ; Customer Inakes purchase.
Acquisition costs outweigh revenues. CustomerValue —Sample Scenario GEAR e YEAR 2 YEAR 4 'YEAR S
Year 2: Custonler buys Revenue from basic goods & services

product upgrade and
recommends product
to anothercustomer.
Year 3: Customer buys
related products. Referral
related
products. makes second pur-
chase. Referral •2 makes
Two new
first purchase. Profit (S) 1,4S0 2,150 3,45 5,8
referrals
0 00
makc first Year 4: Customermakes
purchases. large-scale purchase.
Referrals and buy
Business Chapter 5
And so on. James L. Ileskett, "Focusing on Your Customer, " Harvard ManagcMento-r
Making service the priority

Fitting customer service into the big picture What
differentiates
competitive business environment?
product? Price? Guess again. Many of the
corporate worlffs best and brightest believe
that the key ingredient to *inning a
customeds repeat business is customer
sewice. They recommend that companies
align ail areas Of their organization with
customer service as the defining element.
Ali employees — receptionists, administrative staff, middle managers, as welt as

the executives or the company should be part of this alignment. In order for this
to work. of course. this •customer service orientation- must begin right at the
top. Consider this situation: a customer of large corporation cads in to get
assistance with a problem. The customer is mistakenly transferred to the
telephone extension of an employee in Accounting.
RESPONSE Oh, you need Customer Service. Hold on. [and the client is transferred to the
Customer Service department]
RESPONSE rm Sony. I think you were mistakenly transferred to extension.

rm going to put through to Customer frnice, right? In cose you get disconected or
need to again. that extension is 3039.
As a customer, which response would you prefer to hear? In the First example.
the emp10F•e does not think Of himsetf as serving the customer — thats the job
Of another department. In the second example. the employee is clearly aware that
customer loyalty is what ensures his companys future.
Great service leads to satisfied customers. Satisfied customers leads to customer
loyalty. And customer loyalty? That to profits!
ø Talking about corporate culture

Corporate culture refers to a company's values, attitudes,
and atmosphcrc. It is reflected in how employees treat
each other and their customers. (4) be a good
corporate
According to its corporate policy, Japan
citi:en, with
Airlines has made a commitment — (l) to
transparency in
pursue the world's top quality in airline
business and by
safety and reliability
contributing to
(2) to maximize corporate value for returns society
to all stakeholders
(5) to establish a
(3) to improve service from the customer's corporate
viewpoint climate based
on ability and
challenge
34
superior adequatecustomer customerservice
service
priceprice
quality ofquality of productproduct
How does your organization stack up?
I
•
Business Chapter 5
Tip from Torn Peters, management guru and co-author of In Search of
Excellence, claims that •Customers perceive service in their own
the Top! unique, idiosyncratic, emotional, irrational, end-of-the-day, and totally
bnman terms.
Perception is all there is!"
Source Tom Peters, quoted in Delivering Knock-your-Socks•Off Service,
Revised Edition, by Kristlh Anderson and Ron Zetnke.
Customer A Customer B Customer C Customer D Customer E
Stating what you value in airlines
ACE
AIR
As an airline customer, what do you value most?
[ frequent departures
J on-time service I non-stop flights t I low fares
• Chapter 5 47
( I safety
n The five components of the service process

The customer service process can be broken down into five component parts, each highly influential in
determining the quality of the service provided:
Dependability — the service provider does what was promised
Responsiveness — the service was provided in a timely manner
Assurance — the service provider itvspired the custo•ner's confidence and trust
Empathy — the service provider was able to sce the situation from the customer's perspective Tangible
Evidence — rhcrc is proof that a service has been provided
James l.. Heskctt, on Your Customer," ManageMentcn
I
no longer good enough to be good!
If the customer is king, as the Saying goes, good service is surely not enough. Royally demands exceptional service.
Many colnpanies agree and have begun to look for ways to go beyond simply meeting a customeB expectations —
they're seeking to delight customers.
Author Chris Daffy has proposed the OK + I = Wow! formula for moving beyond custotner satisfaction to
customer delight. In his model, service reps take carc of business, then add a little something extra — 1
more smile
I additional item
I Inore personal contact
I more minute of your lime
I more sign of thoughtfulness
I check to make sure that everything is OK
1 follow-up call to ensure the product is working
C.hns Once a Customer, Always a Customer,
Tree press , IL
The cornerstone Of service — courtesy

Delivering outstanding service requires employees to put forth the very best in themselves. What clients
expect frotn service reps is not so diffcrcnt from what they expect from their colleagues, acquaintances,
friends, and family. In short, the best parts of human interaction:
The ten commandments Of customer service
Chapter Check
I•
Now you can .
Describe the service-profit chain
Can you describe [he relationships hetwecn employee satisfaction, customer loyalty, and profitability?
How do you describe cusunnervalue! How would you describe the corporate
culture where you work?
What did you think of that airline's service?
SPOTLIGHT The Face of

Your
they have with it — checking in, boarding the plane, getting
served a drink and mcal, and so ford). If a company doesn't get
these experiences right, nothing else matters.
These interactions are still. even in thc Intcrnct age, conducted
Business by — drumroll picasc — pcoplc. Thaü why successful

organirations in indtlstrics likc airlines, hospitality, retailing, and
financial scrviccs takc carc to hirc people who fit into a service-
If you want to oriented culture, They train thcm and treat them well so they'll
stay. The best companies build cultures - E in which front-linc
manage customer pcoplc arc empowered to do what\ necdcd to take Carc of rhe
customer.
relationships, invest If companies Eccl the urge buy Customer service software,
in your people, not perhaps they ought to spend on the kind that tells
thcm about thcir prospective enwloyees. Humetrics, Kenexa,
in software. and Unictu offer programs that have helped companies
such as Blockbuster, Target, and Brinkers identify
applicants best suited for service jobs. Hiring right reduces
few months ago. my wife and I planned ro fly
Vlrgin Atlantic London, bur the airline mcsscd up our the cost of turnover, even as it enhances the experience.
reservation. When I called to get it fixed, I waited, and Retailers [alk about "the final 3 feet" — the distance
waited, and waited some more for Someone to answer. I between the customer and the associate — as rhc most
finally gor a disgruntled cmploycc who put me on hold crucial piece of real estate in customer relations. I
agrcc. It; in this space that the battle for survival and
for a while and then disconncctcd me.
growth will bc won.
We flew British Airways.
— JrrFREY I).
My experience shouldnh surprise anyone. A PCW OfBujim•iJ.
Charitable TrtLSts survey last spring found that 46 pcrccnl of
consumers had simply walked out of a storc during the
prcccding year after encountering bad scrv•ice, 81 percent
believed that stores were cutting corners on hiring. Corner-
carving, ill låct, turned our to be thc problem with Virgin,
which reduced its reservations staff aficr 9/1 1 and rhcrcfore
did"" have enough qualified peoplc when business came
back.
Docs anyonc besides me find it odd drat customer service
is dctcriorating even as cornpanies are investing heavily in
customer-relationship managelnent software, the technologv
that tracks customer activity and tailors marketing efforts
ac@rdingly? AMR Research reports that some 34 percent Of
technology managers plan to invest in CRM sofnvarc this
year. ARC Advisory Group estimates that companies will
spend nearly $38 billion on the stllffbctwccn 2001 and 2005.
Maybe ampanies are spcnding on the wrong thing.
Before you can manage a relationship, you first nccd
to build it. And relationships are built by fancy data
mining than by what happens to customcrs when they
actually make contact with thc organization. Call
Southwest Airlines, and instead of gctting a "Inenu of
options," you talk to a real person who actually seems
happy Lo sell you a ticket. Southwest didn't lay
people last fall, so they can rca]y scrvc their
custolners. (WIIat a novel idea.) Years ago Jan
Carlzon led a remarkable turnaround of SAS, the
Scandinavian airline, bawd on the elementary
observation that customers' feelings about a
company come from thc myriad small interactions
Key Words I
on board (prepositional phrase) on an airplane. ship. boat. etc.:
Because the water supply of the ship was unsanitary, everyone
acquisition (n.) from acquire (v.) to come into possession or got sick.
ownership Of: to get: We rcvicwed our customer costs
profitability the state or degree Of financial success in a
including money spent on research and development,
business activity: Our increased dramatically with
odvertising, and special events.
ttie introduction Of several cost-cutting measures over past
attitude (n.) the opinions, feelings. and thoughts a person has year.
about something: Brenda Rittcrson hos such a negative
pull [something] off (v. phrase) to succeed in doing something
qttjtude t.hot she really shouldn't be working in the customer
challenging or difficult Somehow, they ppflgd_qffa profitable
service department.
year when everyone else in our industry reported significant
competitive advantage (n. phrase) something that allows a Josses.
company to be more successful in a particular area than its
competitors: Our access to high-quoiiry, low-cost materials reliability (n.) the quality Of being dependable, trustworthy or
Overseas gives us c competitive advantage over Other companies accurate: The of the Honda has madc a loyal customer Of Poul
in our industry. Shemeid. He has owned severol. and each has performed so well
over the ycars that he feels very comfortable with the brand.
competitor (n.) from compete to try to outdo a person, a
product, or a company for customers. market share and, repeat business (n.) when a customer or client returns to
ultimately. profits: Our company is looking for ways to a particular company to purchase additional products
or set-vices: Our research has shown that our improved
improve customer loyalty and discourage Customers from
customer service is leading to more repeat business by many of
buying products from Our Qmpetitors. our Customers.
complaint (n.) a Statement in which someone states annoyance.
roll up one's sleeves (v. phrase) to prepare to do diffcult work
dissatisfaction, or unhappiness about something: Customer
We have a lot Of respect for the manager of our deportment
decreased dramatically ofter we introduced automated check-in
becousc he's willing to and help out when
centeß.
we're struc/ing to meet a deadline.
customer satisfaction (n.) the positive feelings experienced service-profit chain (n.) the relationship between employee
by customers with regard to a product or service when satisfaction, customer loyalty. and profitability: Eoch Of the
they receive what they want or need: [exton, Inc. links Of the service-prom chain is critical in ensuring
measures satisfaction regularly and studies the data very revenue growth and profits.
carefully in an effort to find ways to increase customer to be going places (v. phrase) to be moving toward
loyalty. significant success in a profession, field, or industry. With his
good business Sense, his friendly personality. and his good
customer service (n.) the process that occurs when a looks, everyone agrees that Lester i_s-gging.u.g.cs.
company supports customers by providing information,
assistance. and responses to questions and complaints on viewpoint [a customer's what customers think or believe:
its products or services: When competing products orc When we examine our service successes and failures
similar. nearly otwoys buy from the company with the consider each from the customer's and the service
better record. rep's Viewpoint.
customer service orientation (n.) an attitude that places you name it (expression) suggests that anything one Can
customer service and satisfaction at a high priority: The think to add would be possible for indusion: You can find
customer service orientation at NexTec Enterprises begins at the every kind of ethnic food in the world in New York City — a
top Ond goes oil the way down to the front-line employees. restaurant that serves it.
Customer
follow up
is the company's greatest focus.
to provi& more information or find Out more

Chapter 6
about something: ask my staff to with each customer six
months after their purchases to see how happy they are with our
products and to find out if there's anything we Con do far them.
guess again (expression) implies that one's first assumption
was not Correct; a response is requested: — You've been with
the company for more thon ten years, haven't you? — No, not
even close. Guess-ggqin.
in a nutshell (expression) in very brief form; in a few words:
Here's what we wont shorter work days; better pay;
and more vocation timc.
Business Chapter 5
REVIEW
Business Chapter 6
CHAPTER 1 ROLE CARD A
The Market Research Project
You are One of two recently hired Inarket research specialists at a chocolate and candy
company. Your first project includes working with the other recently hired specialist to carry
out market research that will be used to support the development of a new candy product. The
two of you will write and present a report of your findings to the company's executive
committee.
The executive committee has targeted older, forlner custotner:s as its market for rhe new
product. As children and young adults, these consumers once represented a significant part
of your customer base. The company would like to win their Pricing
business Problems
back.
Youresearch
You strongly believe that using both qualitative and quantitativc are the Purchasing
is necessaryManager
for the at Parvi
best results of any type of market research. You have heard that thc othcr specialist strongly compa
and products from many different
Sanuson's Depot, a major supplier of win
You called the local sales rep al Satnsonk
Solid oak front entrance doors. You exp
from the $725 per door cost last year, bu
door, an increase of nearly 35%. What's m
doors than last year when you bought
400.
Call the sales rep back to ask
about the pricing and to request a
new estirnate.
CHAPTER 3 - ROLE CAR

favors quantitative research. You will
have to argue persuasively with
regard to the value that qtlilitativc
research will bring to your project,
results, and final report for the
executive cornmittee. It's line for your
meeting with the other specialist.
Introduce yourself and begin the
conversation.
CHAPTER 2 - ROLE CARD A
54
It's time for your meeting with rhe Other
Choosing a Budgeting Strategy specialist. Introduce yourself and lwgin
You arc a managing partner Of a chain of specialty the conversation.
stores. Three years ago, your company
owned just two stores. Today, the company owns 27 stores and continued growth is expected.
Your customers clearly enjoy your cotnl'ination bookstore-café-patisserie* locations.
CHAPTER 2 ROLE CARD B
One of the consequences of your success is that your company's financial picture has becotne
much more complex in a very short time. You and your partner agree that this must be
addressed — and soon. As a first step, you've decided to mcct today to discuss the budgeting
process. You strongly believe that a top-down approach is the best strategy for the company.
Your partner is at the door of

your office. Say hello.
CHAPTER 1 - ROLE CARD B

You sublnitted an estimateof $975 per door for the ne
Your pricing structurefor this product is as follows:
QUANTITY UNIT PRICE

1-999 $1,100
The executive cornrnittee has targeted older, former

product.As children and young adults, these consumers
of your customer base. The company would like to win
patisserie French bakery
I•
at a chocolate and candy company. hired
specialist to carry out market of a new candy supplier to construction coanpanies
product. The two of the company's executive developed a good working relationship Parvin
committee. is one of your best clients.
customers as its market for the new once represented estitnate for 1 ,250 solid oak front last year
a significant part their business back. Parvin ordered only 400 doors. order.
You strongly believe that using both
qualitative and quantitative research is
QUANTITY UNIT PRICE 2000-3999
necessary' for the best results of any type
of market research. You have heard that $850
the other specialist strongly favors 1000-1999 975 4000 and up
qualitative You will have to argue 725 Samsor* takes great pride in
persuasively with regard to the value that controlling its costs and hasn't raised
quantitative research will bring to your prices in the past three Your
project, results, and final report for the phone is ringing. Answer it.
executive committee.
Business Chapter 6
training sessions. It's rime fot the
addressed— and soon. As a first step, you've decided

Three years ago, your company stores and meeting to begin.
continued growth is expected. bookstore-café-
patisserie* locations.
c
ompany's financial picture has become partner agree
that this must be to meet today to discuss the
budgeting process. You strongly believc CHAPTER 5 - ROLE CA
that a bottom-up approach is the best strategy for the
company. A
The Wrong Wine
It's time for your meeting. to your partner's
office and say hello. You are the co-owner of the
Sunny Ilills Winery, a small
* patisserie French bakery
wine producer. Your companyS
reputation has been built on
offering fine wines produced in
relatively small quantities. Your
Chapter 6 flagship wine is the Sunny Hills
Grand Reserve.
CHAPTER 4 - ROLE CARD A YOII Ivavc a very small office
staff, and you manage the
Building Employee Commitment winery's largesr and most
You and another manager have the lowest employee turnover profitable
rates in accounts
your company. yourself.
The
Vice President of Human Resources has asked the two of These you to leadtend a series
to beof training
upscale
sessions on building etnployee commitment for other managers in your coinpany.
restaurants, wine The bars,effects
and
of this training session will be measured, tracked, and reviewed by Because
hotels. HR over the yournext two to
customer
three years. base is relatively modest,
You are about to meet with the other manager to discuss keeping'be key issuesall yourfor thccustomers
training
happy is a priority.
sessions. From your experience you know that employees are generally Inore loyal when
they arc challenged and given the opportunity to develop new skills
This is a— skills,
very slowyou recognize,
time of year for
that could be useful in looking for a new job elsewhere someday. You feel
the winery, and much of that providing
your staff is
additional training is a necessary risk when the goal is on 10 vacation.
attract and Theretain the most
shipping
motivated and qualified employees. Ideally, such employeesdepartment
build long,isnwaningful
closed throughcarccrs
the
at the company. You also believe that managers must set a good example by detnonstrating
end of the week while a physical
loyalty to the company and its mission, especially (luring difficult times.
inventory is being done.
Be prepared to explain and support your opinions, and be prepared to question
Your assistant hasand
justdiscuss
notified
the other tnanager's opinions. you that you have a call from the
Together you must come up with a manager of Vino Fino, a wine
list of the five mast important bar in San Francisco. Vino Fino
issues in building ennployee has a regular client since
commitment to begin planning the opening eight years ago. You
know the manager well.
56
Answer the call. Together yon coine up with a list of the
five must important issues in building
employee commitment to begin planning
the training sessions.
It's time for the meeting to begin.
The wrong Wine

You are the manager of Vino Fino,
I
an upscale wine bar in San
Building Employee Francisco that attracts entertainment
Commitment industry executives, movie stars,
You and another manager have the and other celebrities. Image is
lowest employee turnover rates in your everything in your business.
company. The Vice President of Human Customers come to your bar to
Resourccs has asked the two of you to drink the best winc in the world, as
lead a series of training sessions on well as to he seen drinking thc best
building employee commitment for other wine in rhe world. Your
managers in your company. The effects profitability is directly linked to
of this (raining session will be measured, customer satisfaction, custorner
tracked, and reviewed by HR over the loyalty, and referrals of new
next two to three years. customers by current customers.
You are about to meet with the Other You're hosting a special event this
manager to discuss the key issues for the weekend, and everything must be
training sessions. From your experience perfect. Many of your most valued
you know that showing etnployees customers will attend. While double-
respect, recognizing their hard good chccking your inventory of the
work, and being flexible in 110"' you Sunny Hill Grand Reserve — one of
manage them creates Inotivated, your customers' favorites — you
committed employees. While you don't noticed that one of the cases
ignore shortcomings in employee contained a different Sunny Hill
performance, you try to offer praise wine, not the Grand Reserve. You
anytime you need to address a weakness immediately opened all the other
or conccm with a mcmhcr of your staff. cases in your cellar and discovered
that five of ten cases contained the
BC prepared ro explain and support your incorrect wine. This is a big
opinions, and be prepared to question and
discnss the other manage* opinions. problem.
Business Chapter 6
You have been selling Sunny Hill
wines for many years and have a
great relationship with thc owners
of winery. Call them and tell
thent about [he error. You
absolutely must have five
replacement cases of the Grand
Reserve for the event or you risk
disappointing your Customers.
Business I • Chapter 6
58
Your Turn
o A: Tcll the class about a product or service you would like to create or offer. Describe the
product or scrvice (appearance, purposc, uses, etc.). Who would your target audience for
this product or service be? How would you market the product Or service?
B: Ask a classmate if he has seen tclcvision or print advertiscmcnts from another
country. If so, find out what was different about them from his point of view. Did he
think the style Of advertising was very similar to or different from what he was
accustomed to? In what ways? Share your findings with the class.
A: Tell the class about a time when a salesperson gave you the hard sell. What was the
salesperson trying to sell you? I low did you feel.' How did you react to this selling
techn ique
B: Ask a classmate whar shc notices first about a salesperson — body language, attitude,
clothing style, etc. Find Out if the way a salesperson looks or behaves influences her
decision whether or not to buy something. Share your findings with the class.
A: Tell the class which costs and expenses are the most difficult for a company ro
control. How docs your company handle them? What do you do on a day-to-day basis to
control Costs and expenses for your company.'
B: Ask a classmate if he has responsibility for a budget in his work. Find out how your
classmate prepares his budger and how it is used within the organization whcre he works.
(If your classmate is not responsible for the creation of a budget, ask him what aspects of
his •work effect [he company's overall budget and why.) Report your findings ro the class,
n A: Tell the class about someone you know who isn't at all conunitted to his job. What is
his attitude? What do yon think of this attitude? Do you understand the reasons for
it? Do you agree! Why? / Why not?
B: Ask a classmate if she has ever experienced a difficult performance evaluation. What
was difficult about it? Was the manager a demanding person? How did the manager
behave! I low did your classmatc respond to this behavior! Tell the class about your
classmate's experience.
A: Tell the class about a bad customer service experience yon have had (restaurant, store,
airline, etc.). What happened? How did you handlc it? Will you do business with that
organization again?
B: Ask a classrnale what kind of business he would choose if he were 10 start a new
busine+•. What would he do to make the customer service of rhe organization satisfying
to customers? What would / wouldn't he havc his employees do! How would customer
service in his company differ from that Of his Competitors? Report your findings to the
class.
www.berlltzenglish.com
Additional Action Modules
Creating the Questionnaire
This Action Module is intended for gmouPs of 3-6 participants.
You work fot •a mediunl-sized market research firm that specializes in collecting, tracking,
analyzing, and interpreting data in the technology industry. Many technology companies
rely on your firm for their Inarket research needs. Your firm's services include determining
rargct markets, conducting market research, and creating marketing strategies.
Your finn is working on a project for a company that is developing a prototype Of a product
that will combine the capabilities of a PDA, a Inobile telephone, wireless e-mail, and a Web
browser. The product Will also have some lilnited software capabilities, such as word
processing and spreadsheet options.
You are working on a project with other ream members to create a questionnaire to be used
with a focus group. The questionnaire should gcncrate answers to help the cornpany find
out how the prototype meets the needs and expectations Of the target audience and how
likely they would be to buy the product. You are about to enter a brainstorming
session with the other team members. Work with Ille team ro develop the best
questionnaire possible.
The brainstorming session is beginning. Greet the Other team members And begin the
discussion.

The True Value of the Rs
You have recently been protnoted to Sales Manager at one of the largest software
developinent firms in the world. While you enjoyed being a sales rep very much,
you are pleased to have this new opportunity.
When you were protnoled, you assigned your clients to your Lop three sales reps. You
assigned several of your anosr important clients ro one particular rep, who seemed best
suited to manage those relationships. Last week you were surprised 10 receive phone
calls of complaint trom two of these clients who are not happy with this rep. They are
threatening to take their business to one of your competitors. These two clients are very
influential in their industries, and you want to do everything possible to retain them. You
also want to ensure that your cornpany doesn't lose any other clients.
The sales rep in question is an excellent employee in many ways, and you havc a good
Working relationship. You 'nay need to remind the rep Of the value of retention in your
business and brainstorln ideas on how to make clients happier.
You scheduled a casual lunch 'neeting with this rep so that you could discuss the
situation in a comfortable setting. You have just sat down, ordered lunch, and
enjoyed sonle small talk. Now it's time to discuss the probleln.
Creating the Questionnaire

This Action Module is intended for groups of 3-6 participants.
You work for a Ineditltn-sized market research firm that specializes in collecting, tracking,
analyzing, and inlerpreting data in the technology industry. Many technology companies
rely on your firm for (heir inarkel research needs. Your firm's services include determining
target markets, conducting 'narkel research, and creating marketing strategies.
Your firm is working on a project for a company that is developing a prototype Of a

product that will cornbine the capabilities of a PDA, a mobile telephone, wireless e-mail,
and a Web browser. The product will also have some limited software capabilities, such as
word processing and spreadsheet options.
You are working on a project with other team members to create a questionnaire
ro be used with focus group. The questionnaire should generate answers to help
the company find out how well the prototype meets the needs and expectations
of the target audience and how likely they would be to buy Ille product. You are
about to enter a brainstorming session with the other team members. Work witli
the tealn 10 develop the best questionnaire possible.
The brainstorming session is beginning. Greet the other team members and begin the
discussion,
of
The True Value of the Three Rs
You are a sales rep at one of the largest software development firms in the world. One
the former senior reps was recently promoted to the position of Sales Manager and is
now your supervisor. You have great respect for this manager, and you have a good
working relationship.
.As a manager, your new supervisor no longer works directly with clients, but leads
entire sales team. At the time of the promotion, the Sales Manager assigned several
Implementing
important clients to you.the BSC
Unfortunately, two of these clients have been difficult and
aggressive, demanding special treatment and complaining about prices over which
have noYou are a division manager at a large international pharmaceutical firm. Upper management
control.
announced last week that the Balanced Scorecard Performance
Measurement System, which is referred to internally at your company as the '"BSC," is
being adopted for all division and department reviews. You recognize rhat this is a
positive move, intended to improve communication and strategic planning for all
managers, and you support the initiative.
In the past you have typically focused on operational measures in your evaluation and
analysis Of your division. You have been directed by upper management to meet with
another division manager, one who has generally focused on financial measures. Upper
management expects the two of you to work together to create a checklist Of the type Of
information that should be collected and analyzed in order to measure performance under
the new BSC system.
the very you
These clients are very influential in their industries, but you don't have the time or
energy to satisfy them and still take care of all your other clients. You have focused
instead on increasing related sales and sales through referrals with other clients. So
far the strategy is working, and your overall sales have increased this month.
The Sales Manager invited you to a casual lunch meeting this afternoon. You
have just sat down, ordered lunch, and enjoyed some small talk. Now it's time for
business.
You have given careful thought to this situation and look forward to expressing
your opinion on what operational measures should be included, as well as the value
Of each. Yout meeting is about to begin.
The Interview
You arc interviewing for a new job. The company you
reputation in its industry. It would be an excellent this
position. You are well qualified for the job, and it is
strong candidate for it.
You'd like to know about the corporate Culture in the you

to feel a sense of compatibility and belonging at a that
you will bc able to contribute to the overall mission keep
you motivated and committed to your job.
The initial part Of the interview is nearly finished, and

opportunity to ask questions. You have prepared a short
Why is this position open?

2. I low would you
are interviewing with
has a great professional
opportunity for you 10 get
likely that they will see yon
as a
contpany. It is very
important for
company. Also, you
want to feel of the
company — this will
you will soon

have an list
of questions:
describe the corporate culture here?

3. Flow Often are performance reviews done?
4. What are the main purposes Of the performance reviews?
5. How long have the various members of this department been on staff!
6. How well do they work together:'
Implementing the BSC

You are a division manager at a large international pharmaceutical [inn. Upper
management announced last week that the Balanced Scorecard Performance
Measurement System, which is referred to internally at your company as the "BSC," is
being adopted for all division and department reviews. You recognize that this is a
positive move, intended to improvc communication and strategic planning for all
managers, and you support the initiative.
In the past you have typically focused on financial measures in your evaluation and
analysis of your division. You have been directed by upper management to meet with
another division manager. one who has generally focused on operational measures. Upper
management expects rhe two of you ro work rogethcr to create a checklist of the
type of information that should be collected and analyzed in order to measure
performance under the new B.SC systen).
You have given careful thought to this situation and look forward to
expressing your opinion on what financial measures should be included, as
well as the value of each. Your meeting is about to begin.
The Interview
You are interviewing a candidate for a position that became available when a member of
your staff was promoted. Your company has a reputation for taking care of employees, and
your turnover rate is low compared to industry standards. Very often if an envioyee leaves
a position, it is because he or she is being promoted within the company.
Here are Some Of the things your cotnpany does that demonstrate its commitment to
its employees:
• HR has developed a week-long orientation and team-building session for atl new employees
that is designed to create a sense of camaraderie and belonging among them
performance reviews are done twice in the first six months for each new employee with rhe
intent of aligning supervisor and employee expectations as closely as possiblc —
as early as possible
You have completed rhc initial part of the interview with the candidate. You would
now like to give the Uandidate an opportunity to ask questions. This is a very
important part of the interview, and you generally learn quite a bit about candidates
by thc questions they ask and how they respond to your answers.
Say to the candidate: Now that you've heard all about the company and the
position, do you have any questions for me?
I
The Guest Speaker
You are the Training and Development Director in a large financial services firm,
The CEO Of your organization has decided rhat employee performance and productivity
must be improved in order for the cotnpany 10 rennain profitable and continue to grow.
You have done some research on the ways that profit and growth are stimulated by
customer loyalty, as well as how Customer service affects cust0Jner satisfaction and,
ultimately, customer loyalty.
You have invited a guest speaker to visit your company to deliver a two-day training
seminar for all employees who deal directly with clients. This presenter has been highly
recommended by several HR managers Of other colnpanies with whom you are in
contact.
You and the speaker have arranged a final telephone meeting to confirm the issues to be
addressed during the seminar. Be sure to clarify your priorities during the conversation.
Your assistant has just notified you that the guest speaker is on the telephone.
Answer the call.
Business I Additional Action Modules 68

Notes
The Guest Speaker
You are an expert in thc area of the Service-Profit Chain. You have written several articles
in leading business magazines on the subject and have made many visits to cornpanies to
deliver employee training seminars. While you typically focus on front-line service
employees, you often find rhat you must also spend time working with upper management.
If upper tnanagement isn't fully aligned with the customer service orientation, no serious
ilnprovelnents can be made in customer services.
One of the most common mistakes made by upper management is to focus entirely on
customer satisfaction, customer loyalty, and profits. You rccognizc, of course, that these are
all very itnportant parts of the picture, hur they arc not rhe only important parts of it. A
company must also work to irnprove in the areas of employee satisfaction, retention,
productivity, and internal support services. If employees do not feel motivated, supported,
and productive in their work, a company will find it extrelnely difficult to retain
Business I 69
customers.
You are scheduled to conduct a two-day seminar for a large financial services firm ncxt
week, You have arranged a final telephone meeting wirin the Training and Development
Director of the firm to confirm the issues to be addressed (luring the seminar. Go over all
the items you plan to discuss during your training session. Be prepared to explain your
priorities and why they are important items to address.
It'S time for your phone meeting. Call the director.
70 Business • Additional Action Modules

Notes
Business I 71
72 Business • Additional Action Modules
Notes
Business I 73
Notes
Busin
ess
74
Notes
Business I 75
Practice HAPTER
1
Match each statement in the first group with a statement from the second group with a similar meaning. Write
the letter corresponding to the statement in the blank provided.
Our third-quarter goal is to capture more of the market share with our new product.
2. Direct marketing and public relations are key components of our promotional mix.
3. We have increased the value to customers on popular items by including warranties.
4. Our distribution channels make buying our products convenient ot consumers will
choose other companies' products.
5. Due to logistical problems, the prototype has been delayed. The new product will not be offered
until the third quarter of next year.
a. The organizations and people involved in the system of moving our products to buyers must make it
easier for customers to purchase our goods than those of our competitors.
b. We plan to increase our sales by attracting customers fronv our compctitors in Q3.
c. Consumers see our product as more satisfying than before because of new guarantees on quality and
reliability.
d. Due to mistakes in the planning and organization of developing the first version of our new product, we
will not be able to sell the final product until Q3.
e. Our strategies for reaching cust01ners include contacting them through e-mail, telephone, and regular
mail. We try to communicate Opetlly and frequently with our customers to keep their perception of us
positive.
TRACKS 23 - 34: Listen to each series of questions, and select the correct marketing categon.
CATEGORY A CATEGORY B CATEGORY C CATEGOR
YD
demograph ics geographics behaviors psychograph
ics
3. 5. 7. 9.
1 1.
2. 4. 6. 8. 10. 12.
1
Business I • Practice 77
Practice HAPTER
Decide whether each is good Or bad advice for building brand-name recognition and powerful slogans, by shading
(a) if it is a good one and (b) if it is a bad one in the answer sheet.
GOOD BAD
ADVICE ADVICE
1. A slogan should be created for consumers of the product, not

investors in the company's stock or company employees.
2. Advertising is just as effective as positive publicity and public

relations.
3. Slogans should focus on how a product matches or equals

the quality Of competing products.
4. The effectiveness of a slogan is improved when the company
logo is included.
5. Marketers should strive to create a variety of brand nanles and

multiple branding strategies for their products.
6. A great slogan will be easily remetnbered by consumers.
Now rewrite the examples of bad advice so that they offer good advice.
put a check (V) next to the examples of Promotional channels below.

1. radio advertisement 3. telemarketing _ 5. warehouse 7. billboard
8. direct
2. retail store 4. press release 6. delivery truck mail
What type of channels are the others representative of? Write your answer in the space provided.
I•
78 Business Practice
Practice HAPTER
2 n Fill in the blanks with the words in the box.
brand sales campaign prospect product literature sales force

One of the major goals of the new (1) is to increase (2) recognition for our product line. And
while our (3) is knowledgeable and well-trained, it will be very useful for thent to have (4)
available for every
(5) that might walk in rhe door.
e Match each statement in the first group with a Statement from the second group with a similar meaning.
Write the letter coresponding to Zhe statement in the blank provided.
Referrals can be the most influential marketing tool — and they're free.
2. Our company is prepared to go up against the very best in the industry.
3. We were surprised to sce sales soar to a record high.
4. The slump in sales is expected to end soon.
5. One of the easiest ways to increase profits is to focus on related sales.
a. An increase in sales is predicted for the near future.

b. Let's just say we're ready for the competition, and we have every intention of succeeding.
c. If a customer is truly happy with a product he will recommend it to other people.
d. A company can boost revenues by informing existing customers about Other product offerings.
e. Our sales team never expected to get such an enormous boost in sales.
Business • Practice 79
Practice HAPTER
tell clients what you would do if you were in their situation pay attention to
clients' body language think about what you're going to say while a client is talking
focus on the price of sales items allow the product to be rhe focus try to
solve customers' problems with your products or services emphasize the value of
what you're selling focus mainly on what the prospect or client is saying
interTupt prospects and customers when you want to Clarify that you've understood
Practice HAPTER
TRACKS 35 - 38: Listen to the conversations between the salespeople and their prospects.
For each situation, decide which strategy the salesperson is using: hard sell or soft sell.
ITEM HARD SELL SOFT SELL
1. car
2. clothing
3. computer
4. jewelry
n Match each statement in the first group with a statement from the second group with a simikar meaning. Write
the letter corresponding to the statement in the blank provided.
My boss has really been putting pressure on me to complete the budget.
2. We won't be able to grow rhe business until we get our house in order.
3. Once you get to know the business cycle, you can better forecast the year's financial results.
4. We use the top-down budgeting approach in our organization.
5. We use a bottom-up budgeting Strategy in Our firm.
a. people low in our organizational hierarchy initiate the budget.

b. The budget is presented by upper officers and revised as it is passed down in our company.
Practice HAPTER
c. I need to finish the estimate of next year's expected income and spending for my supervisor.
d. If I kccp an cyc on the economy and our industry I can create a more accurate budget.
e. The organization of the entire firm must be addressed before we can increase revenues.
TRACKS 39 - 44: Listen to the following statements and questions. Put a check (l) under the correct heading
to indicate the financial statement that best satisfies the speaker's needs.
STATEMENT BALANCE CASH FLOW
OF INCOME SHEET STATEMENT
2.
3.
4.
5. 6.
Practice
Practice CHAPTER 3
Write the numbers I -7 next to the seven items below that would typically be included in a company's Balanced
Scorecard Performance Measurement System.
political views Of upper management measures of employee
perfortnance
strategies for improving individual performance employee training programs
strategies for improving corporate performance past marketing strategies
information about industry competitors current financial statements

personal goals of upper
details of the responsibilities of each department
management
financial data from 10-15 years ago measures of customer satisfaction
n Fill in the blanks with the phrases in the box.
bottom line crunch the in the black in the red go belly-up go broke
numbers
The accountant worked hard to (l) in order to determine the company's
(2) . He had expected that the company would be (3) but unfortunately he learned that it was, in fact, (4)
. He soon realized that the company would probably (5) before the end Of the year. He did not 100k
forward to telling the owners that they would likely (6) along with the company.
I
CHAPTE
TRACKS 45 - 54: Listen to each speaker and select the most appropriate categon for their remarks.
CATEGORY A CATEGORY B CATEGORY C
Practice
Employee Performance Building Employee The Costs of poor
Assessment Conunitment Employee
Commitment
7
3. 9.
5. .
8
2. 4. 6. . 10.
Match each statement in the first group with a statement from the second group with a similar meaning.
Write the conesponding to the statement in the blank provided.
I've felt a strong sense Of belonging at my new position from the very beginning.
2. While there ate shortcomings in my boss' management style, in general, we're fairly compatible.
3. My manager focuses on what skills we employees are lacking and he frequently points out our
mistakes.
4. Job insecurity has led to dissatisfaction among employees, and many have decided to leave the
company.
5. Her subordinates look forward to performance evaluations because she is very good at setting
goals and working with her team to achieve them.
a. Turnover rates would be much lower if our employees felt that their positions were safe and that they
had more meaningful responsibilities.
b. I think my direct reports respect and value my collaborative management style,
c. We're able to work together without too many problems even though I see faults with the way my
supervisor deals with all of us on his staff.
d. important for employees to feel connected to a company and its mission.
e. My supervisor regularly offers constructive criticism, but never praise.
Practice HAPTE 4
Match each word or phrase from the box below with the underlined word or phrase with a Similar meaning in
the memo. Write 'Our answers in the blanks at the bottom of the page.
a. keeping current employees e. process of change

b. employee advancement f. HR (Human Resources)
c. documents for performance evaluations g. staff
d. attracting new employees h. manage
MEMO
All New Depanment Managers DATE: July 29 FROM: Don Jackson
RE: Manager's Manual
We are pleased to provide you with the enclosed Manager's Manual. It contains
valuable information on (l) (2) emplovee recen!iQn. and (3) It also contains sample
(4) assessment ferns. I hope you will find this manual helpful during your (5)
transition to upper management. We 100k forward to supporting you in managing and
training your (6) new hires as well your current employees in all the positions that you
now (7) supervise.
Please feel free to contact (8) our department if you have any questions.
1. 5.
2. 6.
3.
4. 8.
I•
Practice
CHAPTER
n Decide whether each statement is true Or false. Write T (true) 0T F (false) in the blank before the Statement.
Understanding the links in the service-profit chain is a competitive advantage.
2. Employee retention can be described as the positive feelings experienced by the people that work
for a particular company.
3. Customer satisfaction can be described as the positive feelings experienced by customers when
they get what they want or need.
4. Customer loyalty is a dircct result Of employee satisfaction.
5. The quality of service provided to Customers greatly influences customer satisfaction.
6. Employee satisfaction typically increases with thc availability of things such as warranties, repair
and exchange options, and telephone and Internet resources for solving customer problems,
7. Customer loyalty stimulates profit and growth for businesses.
8. Acquisition costs rarely outweigh revenues for each initial customer purchase.
9. Customer complaints can be a valuable source of information to companies.
10. Calculations of customer value should include revenue generated by referrals and purchases of
related products.
TRACKS SS - 60: Listen to each comment and decide who said it. Put a check (V) in the appropriate column.
A SATISFIED A LOYAL A CUSTOMER-FOCUSED CUSTOMER CUSTOMER EMPLOYEE
2. 3.
4.
5.
6.
88 Business
I Practice
Answer Key
Exercise 1
Exercise 2
I. D 2. C 3. A 4. A 5. B 6. C 7. D 8. A 9. B 10. D 1 1. A 12. C
Exercise 3A
l. good 2. bad 3. bad 4. good 5. bad 6. good
Exercise 3B
Possible rewrites of the bad recommendations;
2. Positive publicity and public relations are more effective than advertising.
3. Slogans should focus on how a product is different from competing products.
5. Marketers should strive to create consistency in the brand name and branding strategy for their products.
Exercise 4A
Exercise 4B
distribution channels
Exercise I
l. sales campaign 2. brand 3. sales force 4. product literature 5. prospect
Exercise 2
Exercise 3 schmooze with prospects and

customers
_X_ tell Clients what you would do if you were in Their
situation pay attention to clients' body language
—X— think about what you're going to say while a client is talking
—X_ focus on the price of sales items allow the product to be the
focus try to solve customers' problems with your products or
services emphasize the value Of what you're selling
—X— focus mainly on what the prospect or client is saying
X interrupt prospects and customers when you want to clarify that you've understcx»d Rankings Of
effective sales techniques will vary.
Exercise 4
l. hard sell 2. soft sell 3. soft sell 4. hard sell
I Answer Key
Business • 89
Answer Key
c
Exercise I
Exercise 2
l. Balance Sheer 2. Statelnent Of Income 3. Cash Flow Statement 4. Statement of Income
5. Balance Sheet 6. Cash Flow Statement CHAPTER 5
Exercise 3 Exercise 1
l. strategies for improving individual performanCe 1 . F 2. F 3. T 4. F 5. T 6. T 7. T 8. F 9. T
2. strategies for improving corporate performance Exercise 2
3. details of the responsibilities of each department 4. in the red 5. go belly-up 6. go broke
4. measures of employee performance
5. employee training programs
6. Current financial statements
10. B
7. measures of customer satisfaction
Exercise 4
l. crunch the numbers 2. bottom line 3. in the black
Exercise 1
Exercise 2
10. T
Exercise 3
1. d 2.a 3. b 4. c 5. e 6. g 7. h 8.f
l. a loyal customer 2. a customer-focused etnployee 3. a satisfied customer 4. a satisfied customer
5. a loyal Customer 6. a customer-focused employee
Exercise 3
l. empathy 2. dependability 3. tangible evidence 4. assurance 5. responsiveness
I Ansuer Key
ACTIVITY 1 | TRACK 1 — Well, irk a cell phone and an
CHAPTER_I — Have you seen the prototype of our
new PDA, Julia?
organizer with wireless e-mail and a
Web browser.
_ — Not yet. Ooh, nice. So what can it — I love the touch-screen display.
IL looks really good. I'm impressed.
90 Business
Audio Script
— Wait till you hear the price: under a B)int B. ThereS safety. comfort. — But we can beat them on price. And
hundred dollars. There's service. We're proud of our we're innovative. Young people like
— I've got to hand it ro you, peter. tops-in-the-industry safety record. And that.
Your ream has done a great job. Any iB no fluke. We seized the nutnbe•r — So you think we can get the younger
thoughrs on whar we're going to call one position four years ago and haven't market, huh? How's the performance!
it? let go of it since, Bur if you ask our — Not bad. — Have you ever
— Marketing has tested several names; passengers what they remcmher most driven a BMW Roadster!
it looks like we're going with the ahonr a trip with us, ninc times out of — Yeah, my brother owns one.
"Pocket Wizard." ten rhefll say it's our friendly flight — So have you taken him for a test drive
- The pocket Wizard 1 like that. crews and ground staff. We like what in the Falcon!
we do — and it shows! - Uh-huh.
ACTIVITY 7 | TRACK 2
— And whar did he think!
— know we've all been very busy, but TRACK 4 — Well, just say hck nor ready ro
we've got to get moving on the PDA Michael Brennan
campaign. Of course, I'm referring ro give up his keys to the Bimmer just
— Who do you go to When you need
our Pcxket Wizard, which I assume advice! Your Mom. Your Dad. And
you've all rakcn a look at. when ir comes to your retirement
— We should probably start with an ACTIVITY 5 | TRACK 7
savings! You need the advice of
announcement at the annual — OK, you've Exen selling our brand of
someone you trust as much as you
technology conference in Las Vegas. cars for a year now. Tell me what
would your own father. Well, we've
Tlten we could do press releases to you've learned about selling.
built our business on relationships that
all the major publications. — I've learned to let the cars be rhe
last lifetimes — successful,
— Leo and I were just saying that this focus.
comfortable, carefree lifetimes.
thing has so many features that it's a Successful and comforrahlc becausc of — And why is that?
narural for commercials. your hard work. Carefree because of — Because often potential buyers come
— And the techies are going to love it, ours, We're nor in the get-rich-quick in with a pretty good idea of what
We really should do something on business. That's just not us. We're in they want.They've been on the
the web the business of turning a lifetime of Website. Ihey've done their
— Contests probably won't be very trust into a retirement of plenty. hotnework
effective, but I think direct mail —So your role is ...l
might work if we partner With TRACK 5
another company offering calling Greg Flynn
plans ot Internet service. Let's not — Let's face it. People come to us for
forger rhete are two target audiences: two things: cutting-edge technology
the business person and the and superior design. What's rhe use of
consumer. I'd start with print — getting the latest handheld if you can't
maylw• get a celebrity in a photo — show it Off? so While our
then move ro developtnent group keeps pushing the
— I can imagine a IV spot set in a envelope of PDA technology, our
trendy café. A group of young hi-tech design team is looking for more ways
types are giving one of their friends a to gcr people looking over ouc
hard time for forgetting his girlfriend's customers' shoulders and saying
birthday. Then one of the guy's friends "Wow, I want one of those."
puts his arm around the forgetful
boyfriend's shoulder, holds our our CHAPTER
PDA and says: You don't need a
memory if you've gor a Wizard.
— So where are we with the sales
— Not bad, Jeff. But let's let the
campaign for (Ire Falcon?
advertising agency take a stab at it
— The dealers have the product
first. Then if they run into trouble,
lircrarurc. The sales force has been
we'll send them to you.
trained. Thcy know what to do from
— Sorry about that, Gloria. I got a bit
the moment a prc%pccr pulls inro thc
carried away.
lot. If the commercials work .
— The problem is we're going up avairbt
ACTIVITY 8 | TRACK 3 BMW. They've got the brand and the
Patricia Nuöez younger customers.
— There's a lot more to this business
than just getting people from A to
Business • Audio Script 91
Audio Script
— To listen to them. Make them feel house in order first before we start — And some of rhe giants have
comfortable. Build a relationship. worrying about whal the found ways to extend patents,
Schmooze a little — just kidding. governmenr's doing. which of course keeps revenues
— Schmoozing is good. If ic helrs build a flowing, even if it means higher
relationship. ACTIVITY 7 | TRACK 9 costs for the consumer.
— I'm finding more and morc that my role — In some ways, prescription drug — One final question: Is it true
is to help customers solve their companies havc been one of the bright that the pharmaceuticals remain
problems. spots in thc economy recently. among thc hest return-on-
— You should avoid words like frroblems. Why is that? investment companies?
Keep it up-beat; use positive language. — Let Ine say first that it's nor an casy —
Make it exciting. environment — with tough competition Absolutel
— And we're not supposed to talk about and complicated regulatory y. — I
the price of rhc car; we should call it an requirements. But a stream of new agree.
investment, right! products has come to market, from hoth
— I find that many customcrs arc the smaller companies and rhc giants in CHAPTER CHECK - C
unrealistic about price, I mean, their the industry.
investment. I tell them what I would TRACK 10
— And some of these companies have
do is — If you've just joined our program,
achieved rapid market penetration with
— Hold on there! I suggest that you leave I'm speaking today with Karen
these products. This has helped thent
rhc I our of it. Selling is not about you Ayers, a columnist and financial
keep their balancc sheets under control.
and your taste or your wallet. It's all consultant. Karen Ayers, whar arc
— I would add that, unlike othcr
about them, the prospects. And you suggesting that investors do
industries, pharmaceutical companies
remember, only a small part of rhe thcsc days in this uncertain
are not quite as affected by economic
prospect's message comes from the economic climate?
downturns.
spoken word. How do you get the rest — Well, firstly, the climate is
— Moving on to another hot topic in thc
of rhe message! changing. We've been telling
industry, can you continent on recent
— Oh — body language. can tell pretty investors it's slowly improving.
criticisms of several players in the
quickly from the customer's walk if he Many companies have cut
industry with regard to potentially exvk•nses and laid off staff,
or she is serious aK»ut buying or not. improper practices! which is difficult, but does
— Tell them they look as if they're ready — govemment is looking into what eventually help thc line.
to own one of our vehicles. If they we Iniglut call "creative" accounting — But othcr companies — the airlines,
resßN1d to that, you're ready to close. practices, as well as gifts to doctors, and notably — arc struggling, aren't they!
they're investigating several advertising — true. The recovery, to this
CHAPTER agencies that own companies that point, has been uneven, hur thcre
study and publish rcports on drugs. are some other positive trends.
ACTIVITY 1 | TRACK 8 — An apparcnr conflict of interest, at the Oil prices have fallen, and that
— As you know, after last quarter's very least. Now, we all know it costs a should help the airlines' balance
results, the Board is putting a lot of fortune to bring a drug to market, and sheets. And wages and spending
pressure on me to get costs down. I'd very few drugs even make it through are up somewhat.
like to ask all deparunent heads to clinical trials. It must be very tricky for — For those who haven't lost
revise their budgets. thosc companies to develop a budget their jobs. — Yes, hut as
— What do you have in mind! for a new medicine, let alone develop companies run down their
— Wc need them ro reduce their the new medicine. How can they keep inventories, as consumer
spending by ten percent. revenues steady and be able to cover confidence itnproves, and as the
— And if their budgets arc already as right those huge R&D costs! unccrrainties in the tnarkets are
as they can get? — One way they do it is to buy up the reduced, the climate becomes
— Then they're going to have to look small companies that have developed better for companies to operate
again. The cost of each and every drug onc or two good products. That way in, and they will begin hiring
we're developing must be cut by rcn they acquire proven products, avoiding again. One very gcxjd example I
percent — one way or another. — Faster rhe costs, and can forccast revenues, was looking at recently is the
govcmmenr approval would help a lot at least until the drug is no longer biomedical company .
— I know it would. Bur let's ger onr patent-protected.
92 Business Audio Script

Audio Script
employee performance — Whar I'm suggesting is this: instead of
CHAPTEIU— evaluations uncotnfortable. talk
about that for a rninute. Who
"performancc appraisals," what you'll be
doing is what's called "managing
ACTIVITY 1 | TRACK 11 wants to begin? Adriana! l'erformancc." Don't think Of yourself as
— Nobody likes doing yearly rhe boss; think of yourself as a coach.
— I just had my performancc review. And as a coach, you need to do three
reviews. They make everyone
— How did it go? uncomfortable, and it doesn't things: one, outline rhc behaviors that
— OK, I guess. When are you going to really help us address rhc issues will help your peoplc accomplish the
or solve the problems we're hav goals of the company. Two, discuss
ing. these behaviors with your direct reports.
— It always seems so stiff and Three, evaluate your people based an
formal. Maybe because how well they engage in these behaviors
I• and, therefore, accomplish the goals. Are
essentially a top-down
— Nexr week. But you know, approach. Almost everything
Lena, there's something I've comes from me; very little
been meaning to tell you. I'm comes from them. And they you With instead Of
thinking of leaving, - Really! seem defensive about being telling the employee which skills are
Why? evaluated. I guess they see it as lacking, the manager and the direct
— It's just that an opportunity at a criticism. report decide together which skills thc
starrup company has come my — That's What the research tells employee will need to achieve the goals
way, and I really like the idea of us, too. and also — and this is ilnportant —
being part of building And this has led to a new approach which skills the etuployee Will need to
something from scratch. which is more collaborative. It will help be ready for the company's future. The
— That seems a little risky in you adopt a more comfortable, and more employee then works with you to make a
this economy. What if it effective, mode of working together. plan for additional training and
doesn't take off? You could Now what might be a first step! development.
find yourself without a job in — To articulate the companyS goals? — In other words, we should bc handling
no time at all. — Yes, and then? — Figure out how to the aescssmcnr of performance a few
— know. There's a ro reach them. But that's not easy, times a year in a two-way exchange in
consider hcforc I rakc rhc — Yes. go€kl. And figuring out how to which wc intcgrarc goal-setting,
plunge. I don't think I'll bc reach requires a two-way continuous development, and evaluation.
making any decisions before exchange, with at least three or four — Precisely. And instead of calling it
my review. meetings in the course of a year. In "Performance Appraisal," let's call it
— So maybe I need to tell your other words, you wouldn't be doing a "Performance Management."
boss how important this one's once-a-year assessment anymore.
going to be for both of you. — OK, a two-way cxchangc is great, bur ACTIVITY 10 | TRACK 13
don't you think there are times when a 10:00 a.m. Kelly — Kelly
ACTIVITY 7 | TRACK manager has to address the behavior of l.amkins.
an employee! — Hi, Kelly. Joe Murray.
12 — Of course, but how you do it can
— As most of you know, what — Hi, Joe. HOW are you?
deternuine whether you are effective or — Good. Good. I just wanted to check
was once called is now called not. In the old days, we would walk in
"Human Resources." This term in with you to see how things are
with a list of issues we wanted to go going.
is actually quite useful in re- over with the employee. These days, we
directing thinking about — Things are going really well. Thanks.
borrow a hit from psychology. One
employees. The reason is that it — Is Walter keeping you busy?
strategy that some very effecrivc
rakes good people to achieve managers use is to offer three pieces of — Walter's great. It always takes time
the results you want. You praise for every shortcoming you to get up to speed at a new job, but he's
simply can't accomplish mention. Once you point out the good made the transition very easy for me.
company goals without people. things pcoplc arc doing, they are much — He tells me you're doing great things
Now, you've all filled our rhe morc willing to hear suggestions for for the group.
quesrionnairc on managing changes. — That's nice to hear. I'm really glad to be
direct reports, so I have a pretty here.
— Are you saying that we don't really do
good idea of how you interact evaluations anymore. and we have to — Well, I'll let you get back to it. You be
with the people who report to soften every criticism in cotnplilnents? sure to let me know if you need
you. But what jumped out at anything.
me is that most of you consider — I will, Joe. nanks for the call.
Audio Script
TRACK 14 issues. Last week it was a — actually speak to every passenger —
howsepainting problern. This week it collect a lot of business cards. I like to find
11:15 a.m. Rich —
has something Lo do with getting his out how my customers are reacting to
Rich. Comc on in.
furniture delivered. It's never-ending service. I almnst always end up with a
— Hi, Joe.
with him. notebook full of comments, suggestions —
— Listen. Thanks for corning by, Please, and a fe.v complaints.
— Hmmm. How much time off is he
have a seat. — How do you handle the
asking for these things?
— Thank you. complaints! — Well, I start offby
— Last week it was a half-day. This week
— Anita sharcd your Icttcr of rcsignation he wants to take Friday off. listening.
with mc last night.
— Tell mc about the work he's doing for
a big blow to the organization. You're
one of our best, Rich. you.
— kind of you to say, Joe. But I think you That's not any better. You know we TRACK 17
know that I've struggling a bit generate reports nearly every week, — I start off hy listening. I try to
since Ken Newman left. right? collect as much information
— Yes, I know. We all have great respect - Uh-huh. about rhc problem as J can. Is
for Ken. He's a rare breed of manager. — Well, Doug is still working on his first. the customer reacting to a
and we miss him. I was hoping that I gave him a little extra time because mistake we've madc? If so, I ask
you'd develop a similar relationship with know it's not always easy to learn a new how we can corrcct rhc tttistake.
Anita. top-notch, you know. system hut six weeks? something If the customer is suggesting we
— I know she is. We're just not seriously wrong add a service, I try to find out
connecting — personally or exactly what it is the customer
professionaliy. — Have you spoken to him? needs. We may offer something
— Anita is under a lot of pressure to — Several times. I've expressed concem. that fills the need, but the
produce. We all handle stress I've tried applying a little pressure. I customer just isn't aware of it.
differently. wanted to be patient, but I'm just — What about the problems for
— Ycah. And Ken handled it all so well getting all rhc wrong signals from which you don't have a quick fix?
that somehow the stress never got to him. — Those are the ones that end up
— I think you need to start documcnring in thc notebook. I have hi-
— He's a tough act to follow. Listen. I your communications with Doug on both monthly meetings with team
know you've got a lot to takc care of in his absenteeism and his work results. leaders from all our functional
your last few weeks with us. I just wanted Let's start with a memo to hina — cc to areas — ticketing, baggage, food
to let you know that Bill Davis and I are me — and let's see what kind of effect it service, pilots, ground ere*' —
truly sad to see you go. We saw you as a has. If you'd like, can help you put a you nattie it. We roll up our
key part of the company's future. If ever draft together, sleeves and try to come up with
we can do anything for you, give me a — That'd be great, Joe. I really appreciate solutions to anything that's
call, OK? — Thank you, Joe. I really your help with this. preventing us from giving top-
appreciate that. You and Mr. Davis have notch scrvice.
been very good ro mc. I'm going ro miss — You've sty)kcn quire a lor
working here.
CHAPTER S about the productivity of your
cmployccs. What do you do that
— Hey — no good-byes quite yet. We've ACTIVITY 1 | TRACK 16 other airlines don't?
got you for another two weeks, right! — Customer service starts with me — it
— Right. -Ihnks, Joe. — Because we were able to buy all
has to in this business. our airplanes new and invest
— Don't mention it, Rich. Give me a ring — How ofrcn do you actually fly on one
if you need anything. heavily in technology frotn day
Of your planes? one, we were able to develop a
— I try to take at least two flights a week. Inodel in which we required
TRACK 15 — How do you spend your time when fewer employees per airplane to
2:30 p.m. Julie you're on board? accomplish these tasks. With
. just not working out. — I spend a lot of time talking to the fewer employees per airplane,
— Can you give me sotne exantples of customers and crew. I start at the back of you can compensate people
what you mean! rhe plane, talk to the flight attendants, then really well. We also scr up a
— He's been here six weeks, hasn't he! go up front and announce ro passengers salary structure that would rcally
that I'm on board and that I'll bc passing work for our crople
— Uh-huh. through the cabin to help serve snacks. —
— He's still asking for time off during Do you speak with many of the passengers
the week to take care of relocation
94 Business Audio Script

Audio Script
Customer A
— The food was magnificent. The
staff was extremely efficient.
And thC seating was luxurious
and comfortable. I think they
should get five stars!

Audio Script
TRACK 19 EXERCISE 2 | TRACK 23 TRACK 34 | Twelve
Customer B One Is there a particular brand that you
— t would rate this airlinc thc worst Listen to each series of questions, and typically purchase for this type of
I've ever flown. The aircraft was ancient, product? If it's not available, what is
select the correct marketing category.
the staff rude. The food was wretched. We usually your second choice!
For this particular item, would you
had delays in both directions and an prefer to purchase a better quality
unscheduled refueling stop on the return.
The letter of complaint I sent to their
product at a higher price or a lesser PRACTICEÆHAPTER2_
quality product at a lower price!
London o(fice was ignored. It was The EXERCISE 4 | TRACK 35
cheapest ticket. Obviously, you get whar TRACK 24 | Two One
you pay for. Where do you usually buy this type of Listen to the conversations between the
product: at a small local store. at a salespeople and their prospects. For each
TRACK 20 shopping Inall, or on the Internet? situation, decide which strategy the
Customer C salesperson is using: hard sell or soft sell.
— l flew with them for thc first TRACK 25 | Three How old are you! Are — Just think how good you'll look driving
time in Decelllber, and all I can say is you married? Do you have any children! down the street in this car! — I don't know.
rhat this airline is going places. Thc I think it might be a little too expensive for
fleer is new and tnodern. The entire
TRACK 26 | Four me.
crew was extremely friendly — grreat What's the highest level of education you — Think of it as an invcsrmcnt in
check-in staff, flights were on time, have attained! What was your field of yourself. I guarantcc you'll love it.
and the live TV was a definite study? — It's not very practical, though. I nccd
plus. I highly recommend them, something that the whole family can
TRACK 27 | Five
TRACK 21 Tell me more about where you live. — It docs seat four comfortably, and you
Customer D Do you live in a city, in a suburb, or in can't bear the gas mileage.
— 'The cabin was pleasant, rhe seats a rural location! — Well, I'm intcrcsrcd, but I'm going to
have to think about it.
comfortable. The food was wonderful
especially the desserts, which were TRACK 28 | Six — We have a special sale going —
better than I've had in some restaurants. When do you usually buy this type of $1,000 off new car purchases — but
When we got to Cancun and found that product — when you see it on sale or only for today only.
our baggage had hcen delayed until the when your supplies have run out and you — don•r think I'm ready to buy today.
need more! I'm going ro have to think about it. —
next morning, thc staff was very
helpful — the"/ gavc us 500 rwos each Well, just make surc you dccidc before the
so that we could buy anything we
TRACK 29 | Seven end of rhc wcck. The price we discussed
needed until the luggage was Whar do you do in your free titne? What was based on a special sale of $1 ,500 off
delivered to our hotel. Best of all, they arc your hobbies? the regular price for all new buyers, It
were gracious about it — we didn't ends in just a few days.
havc to fight for it. It seems to TRACK 30 | Eight
What is your ethnicity! TRACK 36 | TWO —Can I
standard procedure. I was very help you?
impressed hy that. — Yes. thanks. I'm for
TRACK 31 | Nine
something to wear to an office party,
TRACK 22 Do you live in a heavily populated area?
hut I want ro bc able to use it for other
Customer E What are the typical weather and seasonal
occasions, too. I want ro look
— I just flew with them from New York pattems wherc you live?
professional hut casual. Do you have
to Hamburg. In a nutshell, this airline is no any recommendations?
different from the no-frills airlines. The TRACK 32 | Ten
— Sure. This outfit over herc is very
cabin crew just stood there chatting with What magazines do you most enjoy
popular.
each other when I boarded. No hellos, no reading? What is your favorite television
— Hmmm. Itts nice. but not exactly what
smiles. The in-flight service was show?
I'm looking for.
practically robotic. I'm going to try
TRACK 33 | Eleven Are you — How about this! It's a new style this
another carrier the next time I travel. male or female! season and would look very good on
PRACTICE, CHAPTER 1
— You think so?
96 Business • Audio Script

Audio Script
Definitely. We also have something over TRACK 3B I Four position of the business at the end
here that I think you might like. W%at of last quartet.
— How much did you say this ring costs!
do you think of this? — It's $2,999. beautiful, isn't it! — Yes,
—Oh, I like rhar, too. Hmmm Now there TRACK 40 | Two
it is. And what about this one? — Oh,
are roo many choices. How much money did we have to
rhis one is just $1 ,499. It's also very
— Well, before you decide, why don't we spend in order to make a profit
attractive.
look at one more thing. This is one of this year?
— Hmmm. I like them both, but they're a
my personal favorites. What do you bit more expensive than what I'd
think! TRACK 41 | Three
planned to spend.
— Yes. that's nice. Arc we turning profits into cash? And
— Don't think Of it as expensive, consider how arc wc spending our cash?
— Well, Why don't I help you find it an investment.
everything in your size! Then you can try
them all on to scc What looks hest and is
- Really! TRACK 42 | Four
most comfortable. — That'd be great, — Of course. The value of quality jewelry I just want to see some prcx)f that wc'rc
will only increase with time. turning a profit.
thanks.
— hadn't thought Of it that way before.
TRACK 37 | Three — You know, these are tings with TRACK 43 | Five
— Hi, I'ln interested in buying a new highquality stones. I won't have them for Will that show the difference
computer. long. between what we owe our creditors
— be happy to help. What do you have in — Well, I would like ro buy one, but I'm and what we've invested in the
mind! just nor surc about all this. business!
— They're both 25% off right now, but the
— problem is that I'm not very good TRACK 44 | Six
sale ends soon.
with technology. I'm not really surc
— I'm going to have to take some time to I would like to know more details
what I need.
think about this. It's a lot of nuoney. about the money coming into and
— OK. Let me ask you this: What do you
plan to use the computer for? — Like I said, it's an investment. know, I going out of the company over the
really rhink she'll love horh the-SC last six months.
— Well, I'd like to start doing research
on the stock market. My friends say one today, give you an extra 10% off
rhe Internet is the fastest way to get on the other one. PRACTICE:X.HAPTER4_
investment information. — It sounds like a great deal, but it's still a
— It is very efficient for that kind of lot of money. EXERCISE 1 | TRACK 45
research. What else do you plan to — Think of it this way: you're getting a One
use the computer for? great investment at a 35% discount. Listen to each speaker and select
— Hnnn. Well, my kids will probably want Bur, if you don't biy today, I can't the must appropriate categon for
to play games on it, too. guarantee that can give you the samc their remarks. I welcome
— Good. Now [hat have an idea of what deal next rime you visit. challenges and don't give up
you wanr ro use it for, I can give you an — Why not? When the work gets difficult
idea of your options. — Well, the sale ends tonight, and we because receive a lot of support
— How much do you think it will cost? only give the extra off to customers from tny supervisor and my
— It could range anywhere from just who make a purchase during their first colleagues. We work very well as
under $1 ,OOO to over S3,coo. visit. a team.
— Wow, a big range. I didn't expect
to spend Inore than $1,000. TRACK 46 | TWO
— a IOC to think about. Why don't
PRACTICE: CHAPTER 3 We spent nearly half our staffing
show you some computers here in the EXERCISE 2 | TRACK 39 budget for the year replacing
store char I think would be good for employees that left us. We may
One
your nccds. Then I can give you some run into problems at the end of
heading to indicate the financial
product lircraturc to bring home and this year if wc'rc not able to pay
statement that best satisfies the
review. We all rhc models I'm going the bonuses rhat were promised
speaker's needs. I need to review a
to show you, so you dolü have to rush sutntnary Of the overall financial at the beginning of the year.
into a decision.
Business I • Audio Script 9

Audio Script
TRACK 47 | Three TRACK 52 | Eight satisfied with our products and our
Will he doing performance "The company rewards employees services.
reviews next week for each of my who generate new Ideas. There is a
employees. I have asked upper spirit of creativity, innovation, and TRACK 57 | Three
management for salary increases teamwork at all levels of the I am very impressed with the new
for several of them. organization. prck*uct. Ir arrived on time, in perfect
condition, and is exactly what I was
TRACK 48 | Four have a good TRACK 53 | Nine In addition to expecting. I'm definitely going to tell
relationship with my manager, so funds spent on inrcrvicwing, on my friends about it.
I'm not very worried about my candidate travel, and on relocation
performance evaluation next costs, we're also seeing an incrcasc TRACK 58 | Four I really felt that the
month. To prepare for the mcering in hidden costs and lost salesperson was able to see things from
I'vc started taking notes and opportunities that we're nor yet my perspective and gave me gTcat
creating a list of things I've able to accurately calculatc. advice on what products would be best
accolnplished and things I'd like to for my particular needs.
work on improving. I'm surc this TRACK 54 | Ten
will make our meeting Inore As CEO, I would tike to invite all managers TRACK 59 | Five
productive and will hopefully make to attend a special training session we I wouldn't even think about switching to
a gocki impression on my boss. have scheduled for later this week. We're another product.
interested in finding new ways to help
TRACK 49 | Five you motivate your employees. By TRACK 60 | Six
We haven't bccn able to assess the generating new ideas and strategies for I hclieve that customer service employees
true impact of Matr Walsh's rewarding employees, I'm surc Thar we have to be able to see the situation from
departure yet. We know that his will achieve the overall company mission rhe custotner's point of view and then do
knowledge of our business and his more efficiently and effectively. what' necessary to satisfy that cusromerk
skills will be difficult to replace, If needs. If we don't provide reliahlc service
only we had known rhat he was then customers will find somconc else
PRACTICE: CHAPTERS— who will.
dissatisfied with certain aspects of
his job, we might have bCen able to EXERCISE 2 | TRACK 55
address his concerns. One
Listen to each comment and decide who
TRACK 50 | Six said it. put a check in the appropriate
As a supervisor I definitely feel column.
my responsibility to motivate Even when I find similar products at
others by setting the example of cheaper prices I still purchase this
an employee who is fully particular product again and again
engaged in her work and working because rhe company has great cusromcr
ro achieve the coinpany's goals. support. What's dre use of saving a few
dollars initially if it costs you more in rhc
TRACK 51 | seven long run!
We're implementing a new
performance review sysrcm over TRACK 56 | Two
rhe next year. Our goal is to hcttcr I know that when I make a large purchase
understand our strengths and the attitude of the salesperson tnakes a
wcakncsscs as an organization so big difference. That's why I always try to
that wc can identify candidates for see things from rhe customer's
promotions, raises, and additional perspective. I try ro prevent proble.ns
training and support. when possible, and I work hard to make
sure I solve problems that do occur. I do-
my best to make sure thar every client is
98 Business • Audio Script

Glossary
take by force or superior strategy: By the end Of the year, Chinese
manufacturers had cgptured of rnarket for inexpensive watches
and rodios. (Ch. 1) cash now statement a document giving details
acquisition from acquire to come into possession or ownership Of money coming into and going out Of a company during a
Of, to get: We reviewed our custo•ncr COSE including money specified time period: The rash now shows that our Ore paying our
spent on research and development. odRrtising and special invoices on time. (Ch. 3) close a sale (v. phrase) to reach the final
events. (Ch. 5) act (tough to follow] performance•, NO one in step of the selling process in which a contract is signed Or a deal is
our deportment wanted to apply forJohn's position after he left finalized: The client demanded so many changes to that the
the company. 0 tough to follow, onc felt qualified to his shoes. saleswoman wondered if she would ever (Ch• 2) commission a fee
(Ch. 4) allowance (n.) an amount Of money that a company or a percentage Of a sales price paid to a salesperson or agent: Our
thnks it may lose in the future and includes in its accounts: We sales team is motivated to sell os much product as possible each
trpicony see returns Of Of Our merchandise from retail outlets. month because they are paid by
so we generally moke on for this as we project revenues. (Ch. 1)
asset (n.) something owned by an individual or business that
has value or can earn revenue: The firm's indude several high- commitment (n.) an expression Of strong intention to do
rise omce buildings in the business district of the city. (Ch. 3) something or behave in a certain manner: Our firm has mode a to
attitude (n.) te opinions. feelings. and thoughts a person has innovation by fostering creativity in ernp/oyces. (Ch. 4)
about something: Brenda Ritterson has such a negative gttiwde compatibility the ability to work or live together in harrmony: The
Bhat she really shouldn •t be working in the customer service new employee feels a high level Of with the values and goals or
deporrncnt. the firm. (Ch. 4) competitive advantage (n. phrase) something that
allows a company to be more successful in a particular area than
its competitors: Our access to higwqua"ity, Jowcost materials
balance sheet a document summarizing the overall financial
Overseas gives us a wmpetitive• over Other companies in Our
position of a business. often at the end of each quarter and year:
industry. (Ch. 5) competitor frcvn compete to try to outdo a
The company performed wen last quarter os shown by sheeL (Ch.
person. a product, or a company for Customers. mad«t share and.
3) balanced scorecard an internal strategic system to evaluate
ultimately. profits: Our company is looking for ways to improve
performance frorn different perspectives including both financial
custorner and discourage customers from buying products from
and operational measures: nie onowed our co•rV0ny to our vision
our (Ch. 5) complaint a statement in which someone states
and strategies and then translate them into action @aeatjng
annoyance, dissatisfaction, or unhapgfrless about something:
future value in customer relationships Ond more efficient
Custorner decreased dramatically after we introduced automated
orgonizotm•wide prxe_sses (Ch. 3) body language (n. phrase)
check-in centers. (Ch. 5) corporate culture the ideas. attitudes. and
nonverbal cues that show What a person is t'inking or feeling:
beliefs shared in an organization: Placing top priority on customer
Although he said nothing, I could ten by his he wus very angry. (Ch.
service and satisfaction are key values in the Of our organization.
2) boost to increase or raise (e.g.. sales, production. or prices): We
(Ch. 4) customer loyalty (n. phrase) a company strategy Of building
hope the new marketing campaign Will sales during 0 typically
strong relationships Wiff customers so they repeatedly purchase
slow time Of year. (Ch. 2) bottom line the financial figure showing
products and recommend them to others: Acquiring customers is
a company's total profit or loss: Reducing development costs will
difficult and expensive, so it is wise to focus on improving to retain
help to improve the company •s (Ch. 3) bottom-up budgeting
and expand sales. (Ch. 2)
developing a budget beginning with department managers' needs.
then consolidating these needs for final review and approval by
upper management: The CEO believes that understanding the
needs of each deportment is vital. so she uses • the
bottomup_budæng opprooch_ (Ch. 3) brainstorm to participate
freely and spontaneously in a creative style Of developing new
ideas and solving problems: After bminsmrming on afternoon, a
few very interesting and innovative advertising approaches were I Glossary
identified. (Ch. 1 ) brand (m) Üte name given to a product so that
customers will readily and easily recognize it: The Sherman family
has bought same Of soap for the last ten years. (Ch. 2) brand name
(n) name given to a product by a company used for building
custorner recognition: Sharon usually boks for that she kmws
Glossary
when she buys household appliances. (Ch. I ) budget (n.) an customer satisfaction (n.) thc positive feelings experienced by gener
organization's detailed plan Of how it will spend money during a customers with regard to a product or service when they receive nearly
specified period of time: Following our closely witl allow us to What they want or need: Lexton. Inc. measures n 'stnmer 5gti5fgrtipo geogr
achieve our financial goals. (Ch. 3) regularly and studies the data very carcfu'fy in an effort to find ways is de
business plan a document detailing management's strategies. as to inaease customer loyalty. (Ch. S) gnero
well as expected expenses, revenues. financing. etc.: rhe managers customer service the process that occurs when a company metro
Will need to provide a five-year in Order to get the bank ban. 3) supports customers by providing information. assistance. and get ca
CAGR (Cornpound Annual Growth Rate) a mathematical formula to responses to questions and complaints on its products or
show annual compounded yields vs. simple averages: The is o services; When competing producs are similar, J always buy and th
useful statistic for evaluating how companies of different sizes from company with the better record. (Ch. S) get On
have performed during the some tirne period. (Ch. 3) capture to and w
customer service orientation (n) an attitude that
Business I • 99
places for a
customer ser"ice and satisfaction at a high priority: The fr•om scratch (expression) to make or create something Without short
xr.YkCC-QåentqtiQO at NexTec Enterprises begins at the top and goes all our
the WOY down to the front4ine employees service is the using anything that was previously prepared or developed: Bill peak s
company% greatest focus. (Ch. S) Gates and Paul Aflen built a software empire (Ch- 4) increa
Glossary
demographics statistical vital and social information on a with the retail price, the
population, including age, gender, and income level: Hoving Glossary customer a J discount before
making the purchase. (Ch. 2)
identified the demogrgDhjc5 Of our target Consumers, we can now jump out at (v. phrase) when never-ending (adj.) seemingly
develop o rnorketing Strategy. (Ch. I ) something is rnore noticeable continuous; Without end: My
than everything else ard Is work is tzerrxnding — no
direct marketing (v.) strategy where the seller contacts matter what time start and
impossible to ignore: The red
potential customers directly: For our particular needs. telephone envelope me from among the finish each day, there is always
is o better vehicle than e-mail direr-T marketing (Ch. l) white envelopes piled on the plenty to do the next day. (Ch.
direct report (m) the person a manager supervises and is desk. (Ch. 4) let's just say 4) on board (prepositional
(expression) a phrase used to phrase) on an airplane. ship.
responsible for. The director Of the finance department is known for Say something indirectly or boat. etc.: Because the water
keeping his motivated and productive. (Ch. 4) unofficially: I'm not allowed to supply Of the ship wcs
announce who we hired quite unsanitary. everyor* gn board
distribution channels (n.) organizations and people involved in yet. but it •s the internal got sick (Ch. 5)
a system for moving items from producer to buyers: Preston candidate thot we all expected One way or another
Indu5'Jics could Offer more competitive prices if they consolidated to get the job. (Ch. 2) liability (expression) a phrase used to
money a business owes: The say that if one method does
and sold through fewer suppliers. (Ch. l)
business' include a bank loan not work another will be tried
Ond taxes. (Ch. 3) logistics (n.) until a solution is found: we
do one's homework (v. phrase) to research or prepare in the planning. implementation, hove to collect all the data for
and coordination of the details Mr. Anderson •s presentation
advance: It is best to do enc's homework before making a large
of a business or other by the end Of day. (Ch. 3)
purchase such as a car or o home in order to get a good deal. (Ch. operation: With a project as open-ended response an
2) cornplex os ours, are as answer that is more than a
equity (n.) the capital a company has from shares (as opposed to important as the actual work simple 'yes' or 'no': We insist
. (Ch. 1)
market share a measure Of a
that a majority of the
questions on our surveys
require ppen-ended to give us
debts): The Strong stock market will allow morc companies to product'S sales Compared to
use its compettors. Often as much information as
depicted in percentages: At possible about our custorners•
equity instead of loans to finance major purchases. (Ch. 3)
one point. Microsoft held perceptions. (Ch. 1)
financial Statement (n.) a document showing the financial nearly an 85% of the software
position Of a business. Often at the end Of each quarter and P&L (profit and loss) scc
in the uS. (Ch. 1) mission (n.) for income Statement
year: purpose: goals: Our is to (Ch. 3) perception (n.) the way
The company is late sending its fiogneg/_srgremengs to investors this provide excellent service at consumers feel about a
quarter. (Ch. 3) focus group several consumers brought an affordable price. (Ch. 4) company or product: Negative
motivate to encourage Or consumer Of the company
together by a
provide a reason to do existed for years after the
company for the purpose of conducting market research: Lost
something: The oåjitional devastating oil spill. (Ch. 1 )
year participated in 0 I was asked to taste ten different training and resources wc •re performance assessment I
kinds Of candy and to say Which liked best. which liked least, and providing mQtiya!e evaluation I review (n. pYose)
(Ch. 1) employees to wtYk more a rnccting between an
follow up to provide more information or find Out more about efficiently (Ch. 4) motivator ernployee and a supervisor
something: I ask my staff to fQ110Eup with each customer six months (n.) something that makes a discuss work results. goals.
Consurner behave in a certain and future plans for the
after their purchases to see how happy they ore With prtxiucts Ond way: Summer bathing suit employee's position: The
advertisements ore excellent process has been revised so
to find out if anything we can do for them. (Ch. S)
t.nQtiyatQ5 for consumers to that employees learn how to
forecast a description Of expectations for the future based
search for weight loss build on their stxcesses and
on current information: It is too early to make accurate products. (Ch. 1) negotiate (v.) emmine their shortcomings.
about consumer demand for the new product (v.) to make a to deal or bargain with (Ch. 4) persevere to continue
statement describing expectations for the based on current another person in order to trying to do something even
information: We growth of for next year. (Ch. 3) reach agreement: Unhappy though it is challenging or
100 Business •
difficult: Tom in his efforts to between itself and purposes with additional products or
improve his performance even its audience: We results shown in services: Our research hos
though his supervisor was not hovc increased statistical forms: shown that our improved
supportive. (Ch. 4) plummet to since the With o background customer service is leading to
fall or drop suddenly: Once accounting scandal in statistics it not more by many or our
producuon increased and in an effo,-t to surprising that Lou customers. (Ch. 5) retention
manufacturing cost savings preserve market Taylor places a Jot from retain to keep or to hold:
were realized. prices for Our share. (Ch. l) pull of trust in Blanchard Industries has on
DVD players plummeted. (Ch. [something] Off (v. guqntirqt.ive.rseqc cxcelicnt customer record
2) praise (v.) to give positive phrase) to succeed h. (Ch. 1) Which ottnbute to superior
feedback: / my employees in doing something recruit to seek and customer service and
when they do excellent work challenging or attempt to attract competitive pricing. (Ch. 2) risk
so they know that they are difficult: Somehow. candidates for tolerance (n) the amount of
appreciated Ond valued. (Ch. they profitable year employment: We potential dangerous or
4) product literature (n. When everyone visit the best unpleasant results someone is
phrase) promotional material else in our industry universities in the willing to accept in order to
prepared by a company for re-p«yted area every year to achieve a positive outcome:
potential buyers: The contains significant Josses. new graduates. (Ch. Phi'S in traveling to new places
useful information about the (Ch. 5) pull into (v. 4) referral (n.) a
is rather IOW. so you can
different models available. phrase) to drive a expcct careful, conservative
recommendation: A
(Ch. 2) prufitability (n.) the vehicle into a place: behavior he chooses vocation
rxfecgl from a
State or degree Of financial the parking lot so destinations. (Ch I ) roll up
trusted friend is
success in a business activity. we can 100k a' the one's sleeves (v. phrase) to
more convincing
Our increased dramatically map. (Ch. 2) put prepare to do difficult work:
than o television
With the introduction Of pressure on (v. We have G bt of respect for
commerOaJ. (Ch. 2)
several costumhg measures phrase) to force the monoger of our
related sale (n.
over the past year. (Ch. S) someone to do deportment because he's
promotion (n.) a move to a something: / have phrase) a new Willing to roll up his sleeves
better job: With his Bill got a several reports to product sold to and help When we're strucling
mise and increased finish. my existing customers: to meet o deadline. (Ch. 5)
responsibilities. (Ch. 4) supervisor has bccn You can Often sales campaign (m phrase) a
promotion an activity intended mc to complete his increase relg'ed series of events or activities
to improve sales Of a pmduct: one first (Ch. 3) stiles by simply developed to increase sales:
We have a special each year qualitative research educating custorners The new is targeting the youth
Other products you
Glossary
be@c to increase sales Of Of (n.) information offer. (Ch. 2) with its emphasis on rock stors
our seasonal gift items. (Ch. l) collectjon for Ond their music.
prospect (n.) a potential buyer: marketing purposes
If you treat o like a valued to determine sales rep(resentative)
client he will be more likely to people's attitudes. (n. phrase) a person
feel cornfcvtable and purchase opinions, and whose job is to
product. (Ch. 2) motivations that persuade people to
psychographics (m) are difficult to Glossary buy a company's
details about the translate into products: The from
emotions and statistics: Lynne several industries met
behaviors of a • Sheldon favors reliability the quality Of being at conference to
group of people: because it gives her dependable. trustworthy or discuss sales
The of the group a better accurate: The reliqbjhty of the techniques and
studied indicate undeßtanding of Honda has made o loyal strategies. (Ch. 2)
that they are consumers • customer of Paul Sheffield. He schmooze to chat
conservative Ond emotional reaaions hos owned several. Ond each pleasantly With
will not respond to her company% hos performed so wen over someone for the
well to some of our services. (Ch. l ) the years that he feels very purpose Of
products. (Ch. 1) quantitative comfortable With the brand. establishing a friendly
public relations the research (Ch. S) repeat business (n.) relationship: He likes
actions of an information When a customer or client to With clients before
organization in collection for returns to a particular talking business. (Ch.
promoting goodwill marketing company to purchase 2)
Business I • 101
sector (n.) a company expects to departmental budgets: The
particular part of a incrcase staffing by CEO and CFO have a Strong
market: Wc use TV this year. (Ch. 4) vision Of the cfirection they
commercials to reach want the company to so they
the consumer but use the approach. (Ch. 3) top-
we use notch (adj.) the very best: We
advertisements in ore prepared to pay top
industm specific Glo solorics for to/cnt. (Ch. 4) trap
magazines Ond ssa (v.) to catch or hold in an
journals to reach the unpleasant situation With no
ry
business sectQr. (Ch. easy escape: Loy'o fccjs in her
strategy (n) a plan (or
l) sense of belonging job. She wonted to quit o long
achieving a goal: We must
(expression) a feeling tirrr ago, but she hos hod no
create o for reducmg
of being connected to luck findrng another job. (Ch.
company expenses. (Ch.
and part of a group: 4) trend the general way in
3)
Orientation sessions which a situation is changing
have been designed subordinate (n) a person in a or developing: The return-on-
to help new lower position and with less investment figures show a
employees quickly authority than another in an positive in the phormwceutjcaf
feei o of bc'gngine organization: The division industry. (Ch. 3)
the company. manager is responsblc for turnover (n.) a figure or ratio
overseeing nearly forty (Ch. that represents worker
4) replacements over a given
service-profit chain
the relationship SWOT analysis (n.) a system period of time: Due to the long
between employee for examining a company that Yburs, the Jow pay, and
satisfaction. customer focuses on strengths. difficult working conditions, at
loyalty, and weaknesses. opportunities. Beltek was very high. (Ch. 4)
profitability: Eoch of and threats: We will Corry out viewpoint (a customer•s —l
the links of the is 0 before creating the budget (n.) what customers think or
critical in ensuring for next year. (Ch. 3) take a believe: When wc examine our
revenue growth and stab at (something) (v. service successes and foilures
profits. (Ch. 5) phrase) try: I've never played wc consider each rom the
shortcoming a golf. but rd hke to it. (Ch. 1) customers and the service
weakness. fault. or take off (v. phrosc) to suddenly rep's (Ch. S) warranty a written
lack: He bolonced his become successful: The new guarantee given to a customer
ShortCQtT7it7gs os o In!ernet Compony arter by the seller Or manufacturer
salesperson wit* his several articles about it for replacement parts or repair
strengths as o appeared in the major service for a stated penod of
specialist in the newspapers. (Ch. 4) take the time: was oble to get my CD
industry. (Ch. 4) plunge (v. phrase) to make a player repaired for frcc
slump a sudden drop decision to do something risky: because it was stilt under (Ch.
in price. value, or finally decided to Rake-the- 1) you name it (expression)
quantity: There has plunge and start my own suggests that anything one can
been o in soles this bus'mss. (Ch. 4) target think to add would be possible
winter. (Ch. 2) soar to audience / Customer (n) the for inclusion: You can find
fly upward rapidly. as people marketers are trying to every kind Of ethnic food in
a bird: Demand for reach: The for this magazine is the world in New York —
mome phones hos under thirteen years Of age. there'S a restaurant that
±lis year. (Ch. 2) soft (Ch. l) to be going places (v. serves it (Ch. 5)
sell the practice of phrase) to be moving toward
encouraging and significant success in a
persuading, but not profession, field. or industry:
pressuring. a With his good business sense,
customer. Because his friendly per-sonolity, Ond
the customer owned his good looks, everyone
several other Ferraris, agrees that Lester (Ch. 5)
the soiesmon used top•down budgeting (n.)
with her. (Ch. 2) developing a budget beginning
stamng (n.) from staff With upper management's
to provide the financial goals. which are then
employees Of an communicated to department
organization: rhe heads as they create their
102 Business •

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Berlitz Language for life.

MARKETING A NEW PRODUCT

OFFERING OPINIONS ABOUT PRODUCTS

The Four Ps of marketing

n Comparing market share FYI

Quantitative Research based

Qualitative Research collects open-ended responses

The value of brand name recognition

The power of the slogan

How did the product do in the third quarter?

company conduct.' a product!

O Get face time. The first

How to Pitch a Behemoth

O Try an end run.

MAKING THE SALE

"Selling is easy, if you

0 DISCUSSING A SALES CAMPAIGN

owing your customer

A typical marketing budget

Presenting sales techniques and strategies

• When SELLER is temporary: door-to-door selling. • When SELLER is permanent: established

Source: Rank, Persuasion Analysis, uru:u.'.gowt.cllu//xa

AIDA: A Formula for Selling Success

Electronic Business Cards

strategies Interpret body language

Sales guru Tom Hopkins has seen Gets to Yes:

Get Inside Your Customer's

body language (n. phrase) nonverbal cues that show what a

MANAGING THE NUMBERS

"You can't manage what you

O TALKING ABOUT BUDGETS

(0 Step 2 Dcpartment heads develop budgets that support ttiR

Iscussing ancia reports

Forecasting from financial statements

Source: Inc., Annual Report

Balance Sheet shows the company's financial position at a given moment by

Just the facts

— [low are prescription drug companies

Did you hear the one about the accountant?

What's the bottom line?

02003 The New Yorker Collection: from

What is purposeof a budget?

Discuss financial reports

Consolida'ed Statement of Income

What did the experts in

ROM Now that is thrift. Aher a decade of

Tips for Slow business shows signs Of a

Times and quarter Out, the ability to produce and

spending habits. that knows in its bones how ro do more with

So how do you begin? Harvard

trend the general way in which a

liability money a business os•.'es: The business' include o

'What gets rewarded gets done."

n AN UPCOMING PERFORMANCE EVALUATION

Discussing employee Commitment

soum: Taylor Nelson

xplokiiig employee retention

• are "ambassadors" for • job security

Examining management styles

• poor relationship with supervisor

Turnover — the process of losing

Considering 360-degree feedback

n Examining P&G's recruiting and promotion practices