Instructions: Operational and Management Level peer response 2 DB 730
Develop a response to the post below highlighted in yellow. Peer responses must include meaningful and substantive contributions to the discussion, and ideally provoke and challenge the thinking of your colleagues. The reply must be no less than 250 words.
The response should NOT be a critique of the student’s post, nor should you acknowledge if they responded to the question. The purpose is to add value to the post in an effort to continue the conversation;
The response must demonstrate a substantive discussion;
Each reply must be supported by citing at least 2 peer-reviewed journal articles;
Narrative prose only please – no bullet points, numbered lists, or tables.
Must use 7th Edition APA
REFERENCES:
In addition to the 2 peer-reviewed articles, include the following:
Blocher, E., Stout, D., Juras, P., & Smith, S. (2019). Cost Management: A Strategic Emphasis (8th ed.). Boston, MA: Richard D. Irwin, Inc. ISBN: 9781260165180.
Keller, T., & Alsdorf, K. L. (2012). Every Good Endeavor: Connecting Your Work to God’s Work. New York, NY: E.P. Dutton. ISBN: 9780525952701.
Original Task:
After reading Chapters 17, 18, 19, and 20 in the Blocher Text, the student will select 2 techniques/concepts of interest. Submit a thread examining the relationship between the selected techniques/concepts and strategic allocation of financial resources. Then use the Bible, Keller text, and other sources to provide biblical application of the concepts. Support your thread by citing at least 3 peer-reviewed journal articles. Your thread must be in 7th Edition APA format and must include a reference list.
PEER RESPONSE (GF):
Abstract
The business strategy was simple in the nineteenth century since business firms design their strategy based on internal operations. They had a monopoly over information and decided which brand information they could let the consumers know. In the twenty-first century, business strategy is based on external factors because consumers have many touchpoints to get brand information and decide their choice.
Currently, firms base their strategy on the customers’ behavior pattern, which continues to make marketing dynamic in the global market. Another area business firms and investors pay attention is the financial ratios and their interpretations. Investors often pick up the cash flow statement to understand if they can invest in that company or not since it reveals the company’s cash movement.
Introduction
The importance of this essay is to explain the vital role financial ratios have in business decision-making in business firms and why executives cannot make the decision without them. Financial ratios like efficiency, market value, liquidity, and profitability play an essential role in making decisions on the company’s current and future trends. These are important when business analysts review the cash flow statements of business firms. Financial ratios provide forecasts about firms and explain to both stakeholders and investors the profitability of the company. Algaba & Boudt (2017) explained the research that financial ratios are evaluation tools to measure market value to determine the future trend of an operating firm.
The second area discussed in this essay is the role of customers in the competitive market and their decision-making affect business performance. Based on the research, business executives pay attention to ensuring their products or services meet the standard of attraction. Globalization has encouraged new entrants, transforming the marketing paradigms and positioning firms to organize toward a strategic and holistic approach to attracting customers to their brands (Heinonen & Strandvik, 2018).
Lastly, the essay incorporated Keller’s teaching on trusting God. When making a business plan, trust God because unseen events may nullify the market strategies which may coerce executives to redesign different marketing plans.
Financial Ratio Analysis
Business institutions utilize financial ratio analysis as an essential instrumental tool to review firms’ performance in terms of profitability and liquidity to meet pressing needs (Blocher et al. p. 884). Financial ratios guide the decision-making process because these ratios present independent information in the financial statement for economic interpretations, accounting information, and predicting future trends (Baid, 2016).
It is true that business experts build their financial analysis and make a prediction but must trust God’s plan for the business (Keller et al.,2012). Every plan must be according to God’s will and purpose. Financial ratios explain the liquidity, profitability, interest rate, and turnover (Baid, 2016; Blocher et al., 2019). Business executives in the current market utilize financial ratios for business evaluations and guide them for future trends. Ratios analyses depict credit risk that evaluates potential repayments of loans to avoid bankruptcy which negatively impacts business (Baid, 2016; Correa-Mejia et al., 2020).
The success of business evaluations relies on the comprehension of financial ratios and their role in depicting the financial prediction of business institutions in the competitive market, warning business leaders of future bankruptcy, and providing remedies (Yu, Y., Tian, S. (2017). Culture plays a vital role in a business firm and affects the way people perform. Culture is like financial ratios that explain why people work. Business firms use the aggregate price dividend ratio to understand equity premium (Correa-Mejia et al., 2020).
The Role of Customer
Due to the globalization of business firms and the new emerging new entrants into the competition, focusing on customer priority is essential to business success (Blocher et al., pp. 9, 152, 739,740). Business institutions build their market shares based on customer volume and ensure they attract customers through social relationships and personal care needs (Gilboa et al.,
2019). Quantitative research data show that customer explains business firms currently base the strategy on the need of consumers or customers instead of what the institution wants to do (Gilboa et al., 2019).
The worldview is essential and affects how a customer or consumer thinks about the firm product or service. The business firm may lose customer loyalty through unethical sales strategies. Christian willful sin may separate them from God’s presence (Keller et al. pp.160-164). Business strategy must be based on customer experience and integrate their operations concerning current demand in the market.
The leveraging of customers on social benefits is crucial to business operations achievement since they feel connected with the product and employees (Gilboa et al.,2019). Business leaders should constantly strategize and be innovative (Keller et al. pp.165-168). Customer service is about external (customers & suppliers) and internal (stakeholders) (Heeseoket al.,2021).
Business institutions focus their attention on attracting and increasing their market share. Firms are committed to providing the service to build trust for products with their customers. The essence of service is to provide satisfaction and loyalty, making customers enjoy the service or products provided in the market (Gilboa et al., 2019).
Customers’ willingness to promote a firm’s brand plays an essential role in business growth (Blocher et al., 2019). In the competitive market, leaders must learn to trust God because unseen events like pandemics may disrupt customer experience (Keller et al., p.181). In the current market, business firms focus on customer satisfaction through engagement and preferences provided through service innovation (Heeseoket al.,2021).
Service innovations serve as the touchpoint between and the consumer (Harrison-Walker, 2019). Globalization of the market has brought challenges to business firms. Building customer loyalty is the primary concern for all business firms (Blocher et al., 2019; Harrison-Walker, 2019); Gilboa et al., 2019). Haghkhah et al., 2020) explained in their research that satisfied customers positively increase profitability through revenue generations.
Customer loyalty impacts future business progress and enhances competition. When there is a brand failure, firms must strategize messages to allow customers forgiveness before that company can regain its reputation (Harrison-Walker, 2019).
Relationship marketing theory explains the customers and suppliers in the market and how their relations impact future trends (Haghkhah et al., 2020). The marketing theory depicts businesses that focus on managing collaboration between the customers and business firms and how the relationship is essential to continually keep the business in the competition.
Chirumalla & Mostagel (2021) revealed in their research for a business firm to become successful, they must consider all the behavioral patterns of the customer in the competitive market Customers are essential to business institutions because they anchored their aspirations and dreams on experiences for purchased or prospective products or services.
In the quantitative research, Heinonen & Strandvik (2018) revealed that 82% of customers would likely share their bad experience about the company brand compared to 12% who had an excellent experience.
References
Algaba, A., Boudt, K. (2017). Generalized financial ratios to predict the equity premium.2q https://doi.org/10.1016/j.econmod.2017.07.009
Baid, M. (2016). Financial ratios and prediction on corporate bankruptcy in the Atlantic Salmon industry. https://doi-org.ezproxy.liberty.edu/10.1080/13657305.2016.1180646
Chirumalla, K., Mostagel, R. (2021). Role of customers in circular business models. https://doi.org/10.1016/j.jbusres.2020.12.053
Correa-Mejia, D.A. et al. (2020). Financial ratios as a powerful instrument to predict insolvency; a study using boosting algorithms in Colombian firms. DOI:10.18046/j.estger.2020.155.3588
Chirumalla, K., Mostagel, R. (2021). Role of customers in circular business models. https://doi.org/10.1016/j.jbusres.2020.12.053
Gilboa, S., Segar-Guttman, T., Mimran, O. (2019). The unique role of relationship marketing in small businesses’ customer experience. https://doi.org/10.1016/j.jretconser.2019.06.004
Heeseok, W., Sang, J.K., Huanzhang, W. (2021). Understanding the role of service innovation behavior on business customer performance and loyalty. https://doi.org/10.1016/j.indmarman.2020.12.011
Haghkhah, A., Mostafa, S.R., Asgari, A.A. (2020). Effect of customer value and service quality on customer loyalty: Mediation role of trust and commitment in a business-to-business context. ProQuest document ID 2389738871 http://ezproxy.liberty.edu/login?qurl=https%3A%2F%2Fwww.proquest.com%2Fscholarly-journals%2Feffects-customer-value-service-quality-on-loyalty%2Fdocview%2F2389738871%2Fse-2%3Faccountid%3D12085
Heinonen, K. Strandvik, T. (2018). Reflections on customers’ primary role in markets. https://doi.org/10.1016/j.emj.2017.09.005
Harrison-Walker, L.J. (2019). The critical role of customer forgiveness in successful service recovery. https://doi.org/10.1016/j.jbusres.2018.07.049
Yu, Y., Tian, S. (2017). Financial ratios and bankruptcy predictions: An international evidence: https://doi.org/10.1016/j.iref.2017.07.025
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