Professional Documents
Culture Documents
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Outline of the lecture
Topic 1: The internal assessment
Topic 2: The nature of an internal audit
Topic 4: Key internal forces
Topic 5: Management
Topic 6: Marketing
Topic 7: Finance
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Objectives of the lecture
After completion of this lecture students will be able to know:
1. Define the Internal assessment
2. The nature or Internal audit
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The Internal Assessment
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The Internal Assessment
The internal assessment focuses on identifying and evaluating a firm's
strengths and weaknesses in the functional areas of business,
including management, marketing, finance/accounting,
production/operations, research and development, and computer
information systems.
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The Nature of an Internal Audit
For example, Maytag is known for excellent production and product design,
whereas Procter & Gamble is known for superb marketing.
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Key Internal Forces
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The Process of Performing an Internal Audit
The internal audit requires gathering and assimilating information about the
firm’s management, marketing, finance/accounting, production/operations,
research and development (R&D), and management information systems
operations.
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A) Management
o Planning,
o Organizing,
o Motivating,
o Staffing,
o Controlling.
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1. Planning
o Planning is the start of the process by which an individual or business may turn
empty dreams into achievements.
o Planning is the essential bridge between the present and the future that
increases the likelihood of achieving desired results.
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2. Organizing
o Organizing means determining who does what, and who reports to whom.
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4. Staffing
o Staffing activities play a major role in strategy-implementation efforts.
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5. Controlling
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B) Marketing
o There are seven basic functions of marketing: (1) customer analysis, (2) selling
products/services, (3) product and service planning, (4) pricing, (5) distribution, (6)
marketing research, and (7) opportunity analysis.
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1. Customer Analysis
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2. Selling Product/Service
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3. Product and Service Planning
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4. Pricing
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5. Distribution
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6. Marketing Research
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7. Opportunity Analysis
Opportunity analysis involves assessing the costs, benefits, and risks associated
with marketing decisions.
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C) Finance / Accounting
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1) Finance / Accounting Functions
Investment decision,
Financing decision,
Dividend decision,
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a) Investment Decision
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b) Financing Decision
The financing decision concerns determining the best capital structure for the
firm and includes examining various methods by which the firm can raise capital
(for example, by issuing stock, increasing debt, selling assets, or using a
combination of these approaches).
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c) Dividend Decision
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2) Basic Types of Financial Ratios
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Basic Types of Financial…
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Basic Types of Financial…
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D) Production/Operations
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Production/Operations…
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E) Research and Development
Organizations invest in R&D because they believe that such investment will lead
to superior product or services and give them competitive advantages.
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Research and Development…
R&D in organizations can take two basic forms:
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F) Management Information Systems
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References
1. Strategic Management Concepts and Cases Sixteen Edition by Fred R.
David, 11th Edition.
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