Advantages Of Line Organization

Line organization or vertical organization has the following advantages:

1. Simple To Operate

Simplicity is one of the major benefits of line organization. It can be easily designed, and operated without any complication. All the staff members of the organization clearly understand the their jobs and responsibility easily.

2. Fixed Authority And Responsibility

In line organization, authority, duty, and responsibility are clearly defined and fixed to all employees. Authorities and responsibility cannot to delegated.

3. Effective Control And Strong Discipline

Due to direct link between superior (supervisor) and subordinates, better control is possible in line organization. It also helps to maintain strong discipline.

4. Prompt Decision

Because of single authority and responsibility, superiors or departmental heads can take decision very quickly because they do not need to consult others for decision making.

5. Flexibility

Line organization is flexible in nature. Manager can make changes according to the environment. Departments and sections can be added or decreased easily as per needs.

6. Economical

Line organization is very economical because of simple design and low operating costs.

7. Direct Communication

In line organization, there is direct link and contact between superior and subordinates. So, direct communication is possible between manager and employees.

8. Coordination

In line organization, coordination and cooperation is possible due to the hierarchy in the management.

9. Unity Of Command

Unity of command is found in line organization because subordinates are responsible to only one superior.

10. Effective Management

In this type of organization, top level management can easily control the organization because of chain of command and effective control system.

11. Executive Development

Under line organization, superior takes various decisions depending upon the situation. It helps him to develop decision making power and cope with different situations. Different training and development programs help to offer different opportunities.

Evolution Of Marketing

The development or evolution of marketing can be studied in the following stages:

1. Self-sufficient Stage
There were very limited human needs or wants in the initial stage of human civilization. People could fulfill their needs themselves. They used to fulfill the needs according to the time by hunting, keeping cattle and farming. As they could meet all their needs producing necessary goods by themselves, they were self-dependent and self-satisfied. There was neither necessity of exchange or business for human life nor evolution of marketing.

2. Barter System Stage
Due to development of economic life, human needs and wants went on gradually increasing with the development of human civilization. As a result, the stage of self-dependence ended. The people became unable to supply their daily needs by themselves. There came a situation that certain person could achieve expertise in particular work or field. Certain persons began to be specialist in specific field. People developed practice of exchanging goods to fulfill their needs. In this stage, people used to search proper person for exchanging necessary goods with the goods they would save; they would determine the terms and conditions through mutual negotiation an d exchange their goods to meet their needs. This can be taken as the early stage of marketing or business.

3. Local Market Stage
In the beginning of barter exchange of goods, people had to walk from door to door seeking necessary goods for exchange. In this way, the people living in one place began to have contact with the people living in another place. They began to identify needs and get knowledge about new goods. They began to produce more goods to get benefit from the division of work and specialization. They began to seek an alternative to get rid of the trouble of door-to-door walking to exchange necessary goods. As a result, they began to use certain place for exchange of goods. Such place was named as 'market'. In this way, local markets began to exist under barter system. The practice of exchanging necessary goods started.

4. Money Economy Stage
Even though certain places were developed as markets for exchanging goods, people's needs and wants went increasing. There began to arise problems and difficulties in barter system. Lack of double coincidence of needs, lack of common measure of exchange, lack of store of value, difficulty in transferring value of goods, impossibility in division of goods etc. made barter system impractical. As a result, money was invented. In the beginning, commodity were used as the medium of exchange and as the money for the measurement of the value of goods. Later on, metal coins and paper notes were introduced. People got more motivated to production of goods due to division of labor, specialization, local markets and introduction of money. As production began to increase, a class of intermediaries or middlemen earning profit by buying and selling goods emerged. The middlemen started the activities of marketing and exchange such as seeking customers, seeking markets, receiving purchase orders and selling goods accordingly. Such profit earning business, buying products from producers and selling to customers, gradually became popular.

5. Town Economy Stage
The increase in population and economic activities affected development of marketing. Various means of transportation and communication developed in different places of the countries. Big towns were established in such places. As a result of industrial revolution if 18th century, big manufacturing industries and business companies began to be established. Massive quantity of goods began to be produced using automatic machines, specialization, division of labor and standardization. Different channels of distribution began to be used to delivery goods to the doors of the customers. In order to get success in increasing competition, wants and needs of the customers began to be identified. Branding and packaging of product began. Transport, warehouse, financial institutions, insurance companies etc. developed to help in production and distribution of goods. Collection of market related information, market research etc. also became parts of marketing.

6. International Economy Stage (Current Stage)
Marketing did not remain limited within local markets and towns of any country. Nowadays, the world itself has become a big market. As not any country is self-dependent, different countries established economic relationship to fulfill one other's needs. Economic development got international level. International trade developed to sell products of a country to different countries of the world. Now, several international level industries, as multinational companies, are operating in different countries. Some countries are found to have produced goods focusing their attention on international markets rather than their national markets. Now, importing raw materials from underdeveloped countries and providing finished products to them has become the main mission of developed countries. Transportation, warehouse management, insurance companies, banks and other financial companies have played an important role in facilitating international trade.

Requisites Of Business Success

Following are the major components (requisites) required for successful business operation:

1. Establishment Of Clear-cut Objectives

Clearly defined objective helps to provide guidelines for future business activities. Long-term and short-term objectives should be established in order to achieve goals.

2. Proper Planning And Clear Policy

Proper planning helps the businessman to decide what to do and how to do different business activities. Correct and clear policy helps to perform work with minimum risk and maximum profit.

3. Sound Organization And Effective Management

This is another essential requisite for business success. Proper organizational structure and quality management helps in planning, coordinating, motivating, directing and decision making. It helps proper utilization of resources and to achieve organizational goals.

4. Dynamic Leadership

Dynamic leadership is another key factor for business success. Leader or manager with vision, courage, foresightedness, and motivating skills is needed to operate business successfully. 

5. Pleasant Personality

Manager should be physically and mentally sound to handle business activities smoothly. Manager or businessman with good communication skills, intelligence, experience, and good commanding is needed for business success.

6. Adequate Capital/ Proper Financial Planning

A proper financial planning is needed to arrange adequate long-term and short-term capital to operate business. Suitable source of capital should be identified to run business smoothly.

7. Proper Location And Layout

Proper location and layout helps to reduce production and operation cost and increase efficiency of the business. Suitable location and proper layout helps to maximize profit.

8. Employees Morale

Encouraged and motivated employees play very important role in business. Success or failure of business depends on the morale of employees. Therefore, staffs should be motivated, encouraged, and properly trained to achieve organizational goals and objectives.

9. Modern Technology

Successful business organizations use modern technology to provide new and easy methods in production and distribution. It helps to boost business and earn more profit.

10. Research And Innovation

It is another important requisite of business. Research and innovation helps to satisfy customers by offering better products and services according to their needs, taste, and preference. 

11. Efficient Marketing

Customer oriented marketing is necessary in business. It helps to expand business and grow customers.

Factors To Be Considered Before Commencing A Business

Following factors have to be considered before starting a new business:

1. Proper Mindset

Right mindset helps to achieve great success in business. It helps to follow the dreams of success in business. 

2. Selection Or Identification Of Proper Business

This is another key factor that should be kept in mind before commencing a business. A businessman has to decide the nature of business he wants to start. Business may be manufacturing, assembling or trading. Proper business should be selected on the basis of personal knowledge, skills, capacity of earning, riskiness, resource availability, competition, and possibility of future growth.

3. Forms Or Types Of Business

There are different types of businesses like sole trading, partnership, joint stock, cooperatives etc. Businessman should choose proper type of business according to his skills, risk bearing capacity, capital requirement etc.

4. Adequate Capital

Without a capital business activities cannot be operated. Therefore, it is known as blood of business. Businessman should determine the required capital according to the nature, type and size of business. He should manage adequate volume of fixed capital as well as working capital before commencing a business.

5. Proper Business Location

Selection of appropriate location is another factor that should be considered before starting a new business. Location depends on the nature of business. Location with availability of labor and raw materials, better water supply, electricity , communication service and transportation is preferable.

6. Government Policy And Legal Requirement

Before starting a new business, government's business and commercial policy should be studied. Business firms should follow the rules and regulation of the country. 

7. Selection Of Capable Employee

Capable staffs are needed to run business activities smoothly. Efficiency of staffs plays a vital role in order to success in business. So, dedicated, hard working, honest, self-motivated and experienced staffs should be selected.

Difference Between Industry, Commerce And Trade

Major differences between industry, commerce and trade are as follows:

1. Meaning

Industry: It involves manufacturing activities such as extraction, construction and production of goods.
Commerce: It involves distribution of products produced by industries,
Trade: It involves transfer or exchange of products distributed by commerce.

2. Capital Requirement

Industry: Requires huge amount of capital to establish industry.
Commerce: Requires less amount of capital than industry but larger amount than trade to operate its activities. 
Trade: Requires less capital than industry and commerce.

3. Level Of Risk

Industry: Riskier than commerce and trade.
Commerce: Less riskier than industry but involves high risk than trade.
Trade: Relatively less riskier than industry and commerce. 

4. Side

Industry: Supply side of the product.
Commerce: Demand side of the product.
Trade: Both side (demand and supply) of the product.

5. Creation Of Utility

Industry: It creates form utility.
Commerce: It creates time utility and place utility.
Trade: It creates processing utility

6. Place Of Operation

Industry: It is operated in workshop or factory.
Commerce: It is operated from production center to distribution center.
Trade: It is operated in the market

Difference Between Economic And Non-economic Activities

The key differences between economic activities and non-economic activities are as follows:

1. Meaning
Economic Activities: Activities performed for economic gain.
Non-economic Activities: Activities which are not performed for economic gain or income. They do not give any financial return.

2. Objective
Economic Activities: There are performed to earn profit or earn a livelihood. 
Non-economic Activities: These are performed for self-satisfaction only.

3. Expectation
Economic Activities: Creation of monetary income.
Non-economic Activities: No expectation of monetary income, only psychological satisfaction.

4. Measurement
Economics Activities: In terms of money.
Non-economic Activities: Cannot be measured in monetary terms.

5. Outcome Or Result
Economic Activities: Satisfaction of human needs through wealth and income.
Non-economic Activities: Mental satisfaction and personal pleasure.

6. Duration
Economic Activities: Performed regularly to satisfy one's financial needs.
Non-economic Activities: Performed for limited time or during spare time only.

7. Impact In National Income
Economic Activities: These activities affect national income of the country.
Non-economic Activities: These activities do not make any impact to national income.

8. Examples
Economic Activities: Business, profession, employment etc.
Non-economic Activities: Domestic work, social services etc.

Difference Between Old And New Concept Of Marketing

The differences between old and new concept of marketing are as follows:

1.Consumer Satisfaction
The old concept of marketing gives emphasis to earn maximum profit by selling more and more products while the modern concept gives emphasis to provide maximum satisfaction to the customers and only then earn profit. Modern concept is customer-oriented whereas old concept is sales-oriented.

2. Integrated Process
According to the modern concept, marketing is a dynamic and integrated process in which it is not only necessary to have relationship among all the marketing activities, it is also essential to have proper plan of all activities and coordination among them. Modern concept gives more emphasis to the study of the needs, wants of customers and their behavioral system.

3. Marketing As A Social System
In the old concept of marketing more emphasis was given to selling. Searching future customers, giving information about goods or services to them, making them willingness to buy etc. are the functions of marketing. According to the modern concept, marketing is supposed to be a social system in which involves various business activities and functions. They remain affecting one another.

4. System Approach
The modern concept of marketing gives emphasis to systematic study of marketing and systems approach. This means, all the activities of marketing should, in a coordinated and integrated manner, be directed towards the main objective of the organization.

5. Marketing Information System
The modern concept of marketing also gives emphasis to the use of information system in order to increase benefit and productivity of the firm. Consumer research is necessary for consumer satisfaction for which adequate information need to be collected. So, information system occupies an important place in the modern concept of marketing. Old concept of marketing lacks it.

6. Social Responsibility
The nature of modern concept of marketing is based on social responsibility. Peoples' welfare, high living standard, protection of environment, maximum satisfaction of consumer etc. are such factors which motivate business organization to adopt marketing policy full of social responsibility.