English for Economist and managers-1

170

image for a product and, on the other, to trigger quick sales. Advertising can reach masses of geographically spread-out buyers at a low cost per exposure. Advertising has some shortcomings. Although it reaches many people quickly, advertising is impersonal. It is able to carry on only a one-way communication with the audience, and the audience does not feel that it has to pay attention or respond. In addition, advertising can be very costly. Although some forms, such as newspaper and radio advertising, can be done on small budgets, other forms, such as network TV advertising, require very large budgets.

Personal selling. Personal selling is the most effective tool at certain stages of the buying process. As compared with advertising, personal selling has several unique qualities. It involves personal interaction between two or more people. The effective salesperson keeps the customer's interests at heart in order to build a longrun relationship. Personal selling is the company's most expensive promotion tool. American firms spend up to three times as much on personal selling as they do on advertising. Sales promotion. Sales promotion includes a wide assortment of tools - coupons, contests, premiums, and others. They attract consumer attention and provide information that may lead the consumer to buy the product. They offer strong incentives to purchase by providing contributions that give additional value to consumers. And sales promotions invite and reward quick response. While advertising says 'buy our product', sales promotion says "buy it now'. Public Relations. Public relations offers several unique qualities. It is very believable news stories, features, and event seem more real to readers than do ads. The message gets to the buyers as 'news' rather than sales-directed communication.

Unit 6

The Manager: Role and Responsibilities. Managers are coordinators of economic activities in business organizations. Coordination of group efforts is an essential function in a company, and whoever acts as a coordinator is a manager.

Managers do not perform physical tasks which are necessary to produce and sell the goods and services that are the output of the company. All this is done by workers and employees. On the other hand, the latter would be unable to achieve the goal of the organization without the guiding hand of management.

171

There are literally thousands of decisions in a company about what is to be done, who is to do it and how it is to be done. It is managers who make these decisions and see that they are implemented.

The duties of a manager include:

-the determination of the best form of organization,

-development of a control system,

-budgeting and forecasting,

-marketing and sales policies,

-effective performance of the sales staff,

-development of improved methods for the planning and control of ordering,

-handling and sorting out of the materials and supplies,

-determination of wages and salaries,

-the establishment of incentives for good performance.

The work of managers is, by no means, confined to manufacturing industries. It is indispensable in offices, banks, mercantile establishments, insurance agencies and other similar activities. Management is the team of managers who are in charge of the organization at different levels. Regardless of the specific job, most managers perform five basic functions: planning, organizing, staffing, directing, controlling.

Planning involves determining overall company objectives and deciding how these goals can best be achieved. Organizing is putting the plan into action. In directing, managers guide, teach, and motivate people so that they reach their potential abilities. At last managers control and evaluate how well overall company objectives are being met.

Speaking about personal qualities of a manager it should be noted that he / she needs energy, good judgement, a sense of reality and a sense of social responsibility. Не / she must be persistent in getting at the root of a matter, quick in grasping things and in reaction, and operationally efficient. A manager must be professionally well educated and be knowledgeable in the field of psychology, sociology, management, economics and modern type of business running policy.

How to Meet the Requirements. In light of the rapidly changing business world a businessman if he wants to conduct his business successfully, must meet certain requirements. First of all, he must be flexible of mind and adaptable to change. He needs not so much the specialized knowledge of today's business practice as the qualities of mind and the basic knowledge that will make it possible for him to

172

understand the new business situation and adapt himself to the new business world in which he will live and work in future.

The educational requirements of businessmen are not radically different from those of administrators of other types. Organizational skill, problem-solving ability, imagination, a rational approach to the use of resources, wideness of perspective, and a sense of social responsibility - these are the qualities which are needed for all types of leaders including managers.

It's very important for a manager to have a skill in human relations which has become an important part of effective management. This is to be understood in a broad sense. In other words, the knowledge and skills in the field of human relations should be included in the range of a manager's activities.

Only through such knowledge and skills can a manager ensure the regulation of relations between the members of the organization. In addition, the manager who actually deals with people every day must be quite knowledgeable in the field of psychology. He must be also competent in the area of human behavior.

Managers are problem-solvers. They achieve results through persistence, tolerance, and good will - these are useful traits in large conservative organizations. They achieve their goals through a cautious process of trial and error. Managers strive to protect the existing order of affairs. They identify with status quo. Strengthening existing institutions heightens their self-worth.

Managers fear uncertainty. They prefer to manipulate co-workers and to use established policies to reach organizational goals. Managers are more concerned with processes that achieve results than with the results themselves. Managers focus on the organization's goals. They are driven by a need to conform rather than a desire to change existing systems. They are passive individuals whose goals are shaped by their organization's history and culture.

Managers relate to people according to their job titles and social status. They are more concerned with people's roles in a process than with their needs. Managers' authority stems from their positions. Managers are supervisors, department heads, and administrators.

Choosing a Manager. Choosing a manager is a decisive step in determining the successful functioning of a business organization. Among the requirements which a manager is supposed to meet is a good knowledge of modern information and computing systems, new types of equipment and advanced technologies.

173

The second major requirement lies in the field of human relations. It's a wellknown fact that management is of social nature. Indeed it is carried out through people. Therefore, it's absolutely necessary that a manager should get along well with people, both his superiors and subordinates.

He must try to create a working atmosphere. Applying effective methods of management makes his subordinates realize his plans and intentions, and works to the best of their abilities in order to achieve, in the final analysis, the organizational goals. In addition, as regards young employees working under him the manager should not only direct them, but also educate them, exercising a continuous supervision over their professional activities within the framework of the organization.

The application by the manager of the appropriate principles of management is sure to have a considerable impact on the relationships between the manager and his subordinates. It's a well-known fact that managers have to make decisions practically every day. It's also true that decisions are made at various levels of an organization all the time. In other words, decision-making is an important and integral part of managerial work.

Decision-making is considered to be a rational process in which a choice is made on the basis of the known facts. But it is not limited to this. Decision-making is a social process, and it requires that managers should not only solve problems, but also find and formulate them.

To make effective decisions, managers must be able to understand the various components of the problem which faces them. This not easy because a great amount of work often prevents managers from planning a course of actions.

How Managers Use their Time. Time is a very important factor in managerial performance. Managers can control their activities through planning their time. How the manager spends his time while in office, has a great impact on the performance of his duties. Moreover, the time-plan can show which decisions the manager will make by himself and which decisions will be made by other people and presented to him for approval. The time-plan can help the manager to determine the time-limit for each item of his day's business activities.

Increasing managerial effectiveness requires not only time-planning by the manager, but also his ability to make operative corrections in the time-plan in a constantly changing situation. Moreover, the manager should not deviate from his day's business plan and should ensure its fulfillment. How managers use their time

174

can tell much about them and their work. It also can throw light on managerial behavior as a whole. One fact seems to characterize almost all managers: they work long hours.

According to the information suggested by the survey of the Bureau of Labor Statistics, managers spend more time at the office than any other occupational groups. Research indicates that the manager spends about 43 hours per week at the office. On top of that, however, must be added seven hours per week at home doing paper work and business reading. Another five hours on business entertaining: receptions, banquets and so on, the total amount of time coming to 60 hours a week.

Some organizations believe that managers must not only perform their company duties, but also participate in community, (social) activities. Indeed, such participation sometimes is the best way for an ambitious young man to demonstrate his abilities and bring himself to the attention of higher management.

It should be noted that these external activities of a manager are expanding too rapidly. It is becoming clear, that they cannot be something that a manager performs exclusively on his own time. In the future, such activities will have to be incorporated into the manager's organizational position and his office schedule.

Unit 7

The Principles of Management. The principles of management are considered to be a group of concepts generated by experience and research and expressed in terms of administrative rules and operating techniques. They lay down guidelines for the basic activities of planning, organizing, coordinating, controlling and appraising. Competence in these areas constitutes additional skills so necessary for effective managerial performance.

Many companies are interested in a rapid growth of their management manpower. They have made training in the field of management principles obligatory. This factor is essential for the achievement of future organizational goals.

However, experience shows that training cannot stand alone. To get these principles translated into practice requires a favourable working climate and a high degree of motivation in managerial work. Despite the universal recognition of the existing management principles many young people coming on the business scene find them hard to follow probably because of their poor knowledge of managerial

175

psychology and philosophy. The data obtained from the recent research throws some light on the reasons why some individuals make ineffective managers. The answer is simple: they violate the basic principles of management saying nothing of some general requirements which a manager should meet.

While management is a process of getting things done through other people, its principles can be regarded as a kind of philosophy. If, in the daily conduct of his business, the manager wants to be effective, he should put the management principles into practice. He must also have a profound knowledge of modern information and computing systems and advanced technologies, and be quite knowledgeable in the field of human behavior so that he could establish good relations both with his superiors and subordinates.

Management Objectives. Speaking about managerial objectives one should take the following into consideration.

The main objective has always been maximizing profits and minimizing losses. Managers should keep in mind that they run the business at a profit. Management objectives depend on the legal forms under which the company usually operates. They may be individual proprietorship, partnership - general and limited - or corporations.

Good managers draw up objectives that are clear and understandable to all concerned. In determining the objectives the manager must consider the personal objectives of his subordinates. Objectives must be consistant. They must promote cooperation among various departments of the company, and must be socially reasonable. Ordinary objectives of business have to be in keeping with the manpower and resources at hand. It's necessary to have proper policies to guide people in reaching their objectives.

The policies which are generally established by the Board of Directors must not violate the trust and confidence that the stockholders have placed in the company. They should offer a kind of balance between the objectives of the cooperation and its actual operations. They should consider the operating staffs interests and not be far from what the company's personnel are prepared to accomplish.

The objectives of the business depend, to a great extent, on the organizational structure of the business. Before setting any objective to the organization the manager should ask himself these questions: What are the functions that must be performed?

176

What are the people like who are to perform them? How are these tasks to be carried out?

In order to reach the goal we need procedures. (A procedure is a series of steps that are taken in order to accomplish an objective.) In carrying out management we also require rules (No smoking rule, for example). It goes without saying that rules should be drawn up as required for each organization. While policies may have to be interpreted, a rule must be exact and clear as regards its meaning.

Managing People. Managing people requires a high level of knowledge of human behavior and psychology. Of particular importance for a manager in managing people is the relationship between the manager and his/her subordinates. If a manager wants to be effective, he must try and develop the skills for managing people. Here are a few recommendations to this end.

To manage well you need to work in a climate of mutual trust and respect. The manager has to create an atmosphere of trust and mutual respect. Keep calm when confronted with employees who oppose any new plan or suggestion.

To motivate performance use the Productivity Formula: "Talent times Relationship, plus Expectations, equals Productivity". Make sure people's expectations of what they are to contribute to the business are clearly understood by all.

Project your positive personal attributes; be spontaneous, open and show patience and a desire to attentively listen to and understand a person. Be consistent and show people that they can entirely rely upon you. Increase your positive feedback, guidance and constructive criticism. Maintain a high level of input; actively teach what people need to know.

Use the One Minute Reprimand to get rid of the subordinate's behavior you dislike. Be very specific about what the person did wrong; take 30 seconds (and no more) to say how you feel: disappointed? angry? frustrated? Keep the attention focused on what he/she did wrong and not on how you are obliged to treat them personally.

Clear goals are the basis for all good performance. Set goals in the beginning. Remember: goals must be attainable (achievable), and everyone has to know them. Respect your subordinates and authorize them to think. Take pride in their talents and accomplishments. Recognize and celebrate their victories. Encourage people for their contribution (input) to the victory.

177

Think of innovation as a better way to get the work done. Banish unnecessary paper, rules and bureaucracy.

Unit 8

Economics is the study of how society allocates scarce resources and goods. Resources are the inputs that society uses to produce output, called goods. Resources include inputs such as labor, capital, and land.

Goods include products such as food, clothing, and housing as well as services such as those provided by doctors, repairmen, and public offices. These resources and goods are considered scarce because of society‘s tendency to demand more resources and goods than are available.

Most resources are scarce, but some are not – for example, the air we breathe. Its price is zero. It is called a free resource or good.

Economics, however, is mainly concerned with scarce resources and goods, as scarcity motivated the study of how society allocates resources and goods.

The term market refers to any arrangement that allow people to trade with each other. The term market system refers to the collection of all markets, also to the relationships among these markets.

The study of the market system, which is the subject of economics, is divided into two main theories; they are macroeconomics and microeconomics.

Macroeconomics. The word macroeconomics means economics in large. The macroeconomist's concerns are connected with such global questions as total production, total employment, the rate of change of overall prices, the rate of change of economic growth, and so on.

Macroeconomists measure overall economic activity and analyze the determinants of each activity by the use of macroeconomic theory. They forecast future economic activity and attempt to formulate policy responses to production, employment, and prices.

An important task of macroeconomics is to develop ways of aggregating the values of all economic activities of individuals and firms into meaningful totals. To this end such concepts as gross domestic product, national income, personal income, and personal disposable income have been developed.

178

Macroeconomic analysis attempts to explain how the principal macroeconomic variables are determined and how they interact. Macroeconomics helps to explain the dynamics of economic development.

Macroeconomics is concerned with such major policy issues as the attainment aimed at maintenance of mild employment and price stability. Experience teaches that it would not be possible to eliminate inflation without unemployment. Similarly, an over-ambitious employment target would produce labor shortages and wage inflation.

The principal tools of macroeconomic policy are monetary policy and fiscal policy. As a rule, they are under the control of the government. To stimulate the economy government expenditures may be raised directly or taxes may be reduced, thereby enabling individuals and firms to increase their spending.

Microeconomics. The word "micro" means small, and microeconomics means economics in small individual units such as households and firms that provide the foundation for microeconomics. Microeconomics may investigate individual markets or even the economy as a whole but their analyses are derived from the aggregation of the behavior of individual.

Microeconomic theory is used extensively in many areas of applied economics. For example, it is used in industrial organization, labor economics, international trade, benefit analyses, and many other economic sub-fields. The tools and analyses of microeconomics provide a common ground, or even a language, for economists interested in a wide range of problems.

At one time there was a sharp distinction in both methodology and subject matter between microeconomics and macroeconomics. Nowadays, major distinctions still remain. But more and more macroeconomic analyses are built upon microeconomic foundations.

Optimization plays a key role in microeconomics. The consumer is assumed to maximize utility or satisfaction subject to the income constraints. The producer is to maximize profit or minimize cost subject to the technological constraints under which the firm operates. Optimization of social welfare sometimes is the criterion for the determination of public policy.

Opportunity cost is an important concept in microeconomics. For example, opportunity cost of a public project is the value of the additional goods that the private sector would have produced with the resources used for public project.

179

Economic Policy. An economic policy is a course of action that is intended to influence or control the behavior of the economy. Economic policies are normally implemented and administered by the government. The goals of economic policy consist of value judgements about what economic policy should strive to achieve.

While there is some disagreement about the appropriate goals of economic policy, there are three widely accepted goals including:

1.Economic growth. It means that the incomes of all consumers and firms are increasing over time.

2.Full employment. It means that every member of the labor force who wants to work is able to find work.

3.Price stability. It means to prevent increases in the general price level known as inflation, as well as decreases in the general price level known as deflation.

Discussing Trends - Charts and Graphs. Many businesses use charts and graphs in their research to analyze the marketplace and observe developing trends. Businesses depend on this information to buy, sell and promote their products; they must be prepared for changes in the marketplace that may impact sales.

Business professionals also like to use charts and graphs to lend credibility to their ideas. They say 'a picture is worth a thousand words'. You can show others what might take a lot of time to explain. A chart or graph can be used to support one's point of view, by documenting the direction of a trend in the market from someone's research.

When working internationally, you may be called upon to discuss this type of data or research. You may also wish to add a chart to a presentation, to enhance your sales pitch or presentation.

Finally, you will come across graphs and charts in business journals and magazines, that illustrate research done by others, in the area of investment research and analysis, particularly in the technical analysis of stocks, charts are the foundation for decision making about when to buy, hold, and sell.

A graph shows movement over a period of time. The vertical axis traditionally shows the amount or volume: volume of sales, profitability, productivity, percentage change, amount a product is used and bought, and so forth. The vertical axis shows what you are analyzing. The horizontal axis is your time line, the period of time over which you are comparing the data. Verbs of move are what you need to describe the direction or trend.