Social Media for Business

Social media for business is no longer optional. It's an essential way to reach your customers, gain valuable insights, and grow your brand. Social media provides immense potential for businesses because consumers habitually log on to it daily and are exposed to companies. It also presents huge challenges for businesses, however, because it’s an ever-changing space that is extremely noisy and crowded.

It can be difficult to keep up with evolving trends on social media, so B2B reviews and ratings firm Clutch partnered with marketing agency Smart Insights to learn the current state of social media marketing; they surveyed 344 social media marketers from around the world to determine the value of social media, the most engaging content to share, common challenges, and what social media resources businesses are investing in.

 

Essentials of Social Media for Businesses

Social media is a crucial part of your business marketing, but it doesn’t have to be stressful to manage. Take the first step, create a profile, and start engaging with your customers.

As it continues to weave itself into the daily patterns of our lives, more consumers will go to new and upcoming social platforms for purchasing decisions. Those who have a strong social media presence and branding will increase conversion rates, while those without active social media campaigns could lose potential customers. Which company do you want to be?

If you’re still not convinced, here are six things you can try out yourself to realize that social media is a wise business move.

1. Get Attention and Build Awareness. If people don’t know about your business, they can’t become your customers. Social media boosts your visibility among potential customers, letting you reach a wide audience by using a large amount of time and effort. And it’s free to create a business profile on all the major social networks, so you have nothing to lose.

Here’s a fact: social media content gets attention.

However, it’s really easy for a consumer to become overwhelmed on Facebook, Twitter, Instagram and other social media platforms filled with noise from companies trying to promote their brands. How can a company create relevant content in such a crowded space?

“These content types are effective in getting cut-through in newsfeeds, so it’s important to not only use them, but to invest in them so the quality is there,” Smart Insights CEO Dave Chaffey said.

This is where original content intersects with quality design. Between GIFs, memes, Facebook Live and more, a content strategy has to be carefully thought-out and executed. What message do your customers want to see, how are they going to identify with your brand, and what will get them to click on your post or comment on it to garner a conversation?

Define what you want to get out of social media to develop a social media strategy for brand awareness. Do you want new customers to discover your services? Do you hope to bring more local shoppers into your stores? By keeping your strategy specific, you can determine which social media channels are the best fit for your business.

2. Communicate Authority. Customers are increasingly savvier and more discerning about which businesses they support. Before making a decision, they’ll do a quick search to browse your website and social media.

Will they find an empty storefront or a rich source of information? Setting up robust profiles that you update frequently with relevant content will build your brand’s authority and make sure you make a positive first impression through social media, showing that your business is trustworthy, knowledgeable, and approachable.

Look for ways to demonstrate your expertise as a thought leader in your industry—like writing pieces related to your expertise or expanding on your company’s mission. By showing what your business offers and values, you will establish confidence in potential customers.

3. Show Authenticity. Customers aren’t interested in businesses that publish dry, corporate-style social media posts.

Instead, let your brand’s personality shine through in everything you share on social media. What does your brand voice sound like? How does it represent who you are? While brands need to be polite and empathetic to their audiences, it is more important to find a voice and take a stand.

Practice getting your tone just right, whether it’s casual and funny or formal and friendly. Be true to who you are, not who you think you should be. Followers want to see real people behind your social profiles. Show them.

4. Encourage Engagement. Sometimes, a seemingly simple social media post, such as one promoting a pair of shoes, can receive several likes, comments, and shares. People can even ask strangers in the feed if they have received their shoes, how long the shipping took, if they liked them, and other questions.

Social media opens the conversation for instant interaction, relationship building, and customer loyalty.

“It’s really important that companies have the right organizational structure to support social media,” said Josh Krakauer, founder and CEO of Sculpt. “A customer support team and a product development team tends to be extremely effective.”

Social channels evolve, constantly releasing new features, and this rapidly changing environment can be intimidating for some business owners.

But remember: you don’t have to do everything. Play with new ways to connect with your audience, and give yourself permission to learn as you go. One day, you could post a series of Instagram Stories to give customers a behind-the-scenes tour of your office. The next, you could host a quick Q&A session via Facebook Live video streaming. Over time, you’ll get a better idea of your followers’ preferences.

You can create engaging video content for social media with a simple setup—good lighting, a smartphone, and a tripod. Also, do a test run before you go live to make sure your internet connection or hotspot has enough speed to avoid delays and interruptions?

5. Grow Affordably. Yes, social media isn’t a place to be overly salesy, but after all, it’s a marketing channel and you need not ignore the opportunity to make sales, should it present itself. Sponsored info on timelines, videos with CTAs, cross-channel retargeting and shoppable posts are the mainstay of social media.

Marketing costs add up, and not every business can afford huge campaigns. But you can get a lot of value for your dollar with social media advertising. Your business, regardless of size or budget, has an opportunity to grow your audience and reach your objectives through ads on social platforms like Facebook and Instagram. Even if platforms such as Instagram are primarily geared towards engagement, there are established ways to increase sales on them.

Most businesses are data-driven, but social media isn’t a set-in-stone science. For example, you can scroll by an ad that has a picture of a huge scoop of melting chocolate ice cream topped with a mound of whipped cream. You may not think twice about it, but three days later, you may stop by Baskin-Robbins because you were craving a scoop of chocolate ice cream. Social media can contribute to the buyer’s decision-making process like that.

“Social media, unlike other kinds of advertising, can be notoriously difficult to track,” said Steve Pearson, CEO of Friendemic. “Most consumers say it takes many touch points in their customer journey before a purchase. A lot of those are undoubtedly on social media and online review sites, but customers aren’t necessarily citing those when they walk into a business as the last touchpoint that brought them in today.”

When building an ad campaign, know who you’re trying to reach and what goal you want to achieve so you don’t waste any of your budget on unhelpful advertising. Avoid overly salesy ads, and opt for content that educates or entertains (or does both at the same time).

6. Provide Support. Social platforms have successfully broken down barriers between companies and their customers. Now, instead of calling a customer service line, many people turn to Facebook or Twitter to solve problems or find information.

Develop your reputation as a responsive, caring brand by offering support through social channels:

• Create a system for tracking customer comments, questions, and complaints on social media.
• Respond as quickly as possible to questions and concerns.
• Go out of your way to be positive and helpful.
• Listen to criticism and make customers feel heard.
• Know when to resolve public conversations in private messages.

 

Benefits of Social Media for Brand Building

Social media is a massive lead generation, branding, etc. for any business or company. Without it, a lot of companies are missing out on the bigger picture and what’s still to come! Great points in this post, and great job!

1. Increase brand awareness. With nearly half of the world’s population using social media platforms, they’re a natural place to reach new and highly targeted potential customers.

Think people only connect with brands they already know on social media? Consider that 60 percent of Instagram users say they discover new products on the platform.

When Absolut Vodka ran an Instagram campaign to promote its limited edition Spark bottle, the company achieved a five-point lift in brand awareness.

2. Humanize your brand. A UK study from Trinity Mirror Solutions found that more than half of adults do not trust a brand until they see “real-world proof” that the brand is keeping its promises.

To connect with customers—and potential customers—you’ve got to show the human side of your brand. How are you embracing your brand values? (Do you even have brand values?) How are you looking out for the best interests of your customers and employees? Does your product really work?

The ability to create real human connection is one of the key benefits of social media for business. We call these Meaningful Relationship Moments. Introduce your followers to the people who make up your company and showcase how existing customers are using and benefiting from your products.

A social media advocacy program can be a great way to humanize your brand.

3. Establish your brand as a thought leader. No matter what industry your business is in, social media offers the opportunity to establish your brand as a thought leader—the go-to source for information on topics related to your niche.

Like brand advocacy, thought leadership is a great way to build consumer trust. In fact, LinkedIn research in partnership with Edelman shows that marketers underestimate just how much thought leadership can impact trust, especially for B2B marketers. About half of B2B marketers surveyed believed their thought leadership would build trust in their companies. However, more than 80 percent of buyers said thought leadership builds trust.

4. Stay top of mind. Most social media users log into their accounts at least once per day, according to Pew Research Center, and many people are checking social multiple times per day.

Social media gives you to the opportunity to connect with fans and followers every time they log in. Keep your social posts entertaining and informative, and your followers will be glad to see your new content in their feeds, keeping you top of mind so you’re their first stop when they’re ready to make a purchase.

5. Increase website traffic. Social media posts and ads are key ways to drive traffic to your website. Sharing great content from your blog or website to your social channels is a great way to get readers as soon as you publish a new post

Offer great value in the chat, rather than being too promotional. Just make sure your website address is included in all of your social media profiles so that people who want to learn more about you can do so with one easy click. Even better, use a pinned post to highlight a landing page on your website that’s relevant to the chat.

6. Generate leads. Social media offers an easy and low-commitment way for potential customers to express interest in your business and your products. Lead generation is such an important benefit of social media for business that many social networks offer advertising formats specifically designed to collect leads.

For example, Renault Europe used Facebook lead ads that allowed people interested in learning more about a new model to book a test drive directly from Facebook, with just a couple of taps.

7. Boost sales. No matter what you sell, social media can help you sell it. Your social accounts are a critical part of your sales funnel—the process through which a new contact becomes a customer.

As the number of people using social media continues to grow and social sales tools evolve, social networks will become increasingly important for product search and ecommerce. The time is right to align your social marketing and sales goals.

For individual sales professionals, social selling is already a critical tool.

8. Partner with influencers. Word of mouth drives 20 to 50 percent of purchasing decisions. When you get people talking about your product or company on social media, you build brand awareness and credibility, and set yourself up for more sales.

One key way to drive social word of mouth is to partner with influencers—people who have a large following on social media and can draw the attention of that following to your brand.

Research from Nielsen, Carat, and YouTube shows that collaborating with an influencer can give your brand four times more lift in brand familiarity than collaborating with a celebrity.

9. Promote content. Promoting your content on social channels is a great way to get your smart, well-researched content in front of new people, proving your expertise and growing your audience.

For example, Adobe used LinkedIn Sponsored Content to showcase its research, including info graphics and videos.

Marketing decisions-makers exposed to Adobe’s promoted content were 50 percent more likely to view Adobe as shaping the future of digital marketing and 79 percent more likely to agree that Adobe could help them optimize media spend.

To maximize the social media for business benefits, make sure to have a content marketing plan in place.

10. Go viral. As people start liking, commenting on, and sharing your social posts, your content is exposed to new audiences—their friends and followers. Going viral takes this concept one step further. As people share your content with their networks, and their networks follow suit, your content spreads across the internet, getting thousands or even millions of shares.

This exposure is especially beneficial because all those shares, likes, and comments show an existing connection with your brand. If I see that my friend likes your article, I may be inclined to check out what you have to say, even if I’ve never heard of your company before. In a world where there is far more content than any one person could ever consume, a friend’s social share acts as a kind of pre-screening.

Going viral is no easy task, of course, but without social media it would be next to impossible.

11. Source content. There are two key ways businesses can source content on social media:

1. Source ideas: Ask your followers what they want, or engage in social listening, to come up with ideas for content you can create yourself. Put simply: Give people what they’re asking for. It’s a sure way to create content that people will want to read and share.
2. Source material for posts: Create a contest or use a hashtag to source user-generated content (UGC) you can share. Getting your followers involved can build excitement about your brand while also providing you with a library of social posts to share over time.

 

Using Business and Social Networks for Marketing

As a part of advertising campaign or marketing program, every business will need to use Social Media channels to connect with the market, the prospective Customer as well as the ‘Already’ Customer. If you are interested in building a brand and an image for your product as well as for your Organization or business, you have no option but to be present on the Social Media. Social Media consists of various channels and platforms grouped under Social Networks, Social Content and Social Interactions.

We are focusing on Social Networks including the Personal Social Networks as well as Professional/Business Networks and White Label Networks. Social Networks provide a huge opportunity for an Organization to connect with a community that is interested in the line of business or the product that the Organization is talking about build an online reputation in the long run.

Organizations have found it very profitable to participate and build Social Networks not only with the outside community but within the organization including all the employees. By encouraging, listening and participating in discussions with the employee community, the Organization is able to promote a non-formal platform that encourages the employees to speak up about their views, problems. Important feedback on what the employees think of a particular product, policy or the Company can be gathered easily on such social networks. These networks help the Organizations to search for and recruit good talent as well as nurture smart talent too. Internal Social Networks help the Organization feel the pulse of the employees, build and promote an open culture and enhance the feeling of togetherness too. On the marketing front, it helps the Organization announce its future plans for product development, invite productive and creative feedback and assessment as well as build internal loyalty too.

Apart from using Personal Social Networks as well as the Internal Social Networks, one can benefit largely from using professional Social Networks too. Sites like LinkedIn, Face Book and Jigsaw etc., prove to be a huge mine of data and information on various contacts, specific interest groups, communities of experts etc. Marketers have realized the potential that exists in these business social networks and the community of professionals and have developed successful strategy to engage them for productive purposes. Most of the leading brands and companies have developed strategies of introducing discussions around a new product that they are planning to develop and release and thus build a community of people interested in the said product. By cultivating an online community, they are able to create a buzz around the product and such publicity helps in its actual product launch. In many cases, the Organizations are able to engage with the community of experts on productive discussions regarding the product and thus obtain useful feedback, suggestions and solutions that help with product development. Market research and market feedback can be generated with the help of online communities.

Social Networks, both individual networks as well as professional networks provide the best opportunities for the Organizations to be in continuous touch with its audience and more importantly engage with them on an interactive basis. How far and how much you can get out of these platforms depends upon the how much you can engage consistently and persistently as well as invest time and effort in engaging your customers.

References

https://marketinginsidergroup.com/content-marketing/why-social-media-is-important-for-business-marketing/

https://buffer.com/social-media-marketing

https://youtu.be/9M0Oa7miOoU

https://youtu.be/-tdFvJLw2UQ

Accounting for Managers

Accounting provides management with data needed to determine whether a business is at a loss or a profit, how much debtors owe, how much a business owes others, and other financial information. Accounting measures business transactions and as such can help steer managers in the right direction with solid information, not gut-feelings. Basically accounting is a tool for management to employ to help make sound business decisions on a timely manner. For instance, if by using accounting information, managers notice that the trend is for sales to decrease, then they can take measures to stop this trend. Maybe they need to change prices or decrease expenses to handle the down-trend. The key is that accounting gave them the clue that something may not be going according to plan, playing an important role in business management.

1. Get your cash numbers. Cash is the most important business asset. Managers should use accounting information to see where the business is cash-wise and to plan for financing and other strategies for short-term and long-term planning. For example, if the cash balance is $50,000 and there is a need for a large purchase of $120,000 for equipment, a manager may decide to finance the entire purchase instead of using the $50,000 balance. Many managers and business owners use ratios to analyze financial data. For example current ratio, a popular way to verify how a business is able to meet its short-term debt, is calculated by dividing current assets by current liabilities. The higher this ratio, the better off a firm is.

2. Mind your budget, which is an estimate of income and expenses for a certain point in time. It is a guide to ensure that a business is on track, as planned. Managers should be aware of budget numbers and how they compare to actual numbers. For example, if a postage expense number is almost over budget, managers can research the reason for the excessive expense in that line item and make decisions about that. If actual versus budget reports show a trend towards more expensive inventory costs, then managers may consider renegotiating terms or prices or even changing suppliers.

3. Follow up on accounts receivable. Accounting can help management figure out who owes the company money and for how long. An "ageing receivable report," a useful detailed accounting report, can be used by managers to identify slow paying clients and to follow up on them, preventing possible loss of income. Cash is king, especially with small businesses, and the faster customer pays, the better off the firm is to meet its financial obligations.

Financial Accounting

Financial accounting is focused on providing accounting reports and analysis to other areas of the business. Financial accountants are responsible for the creation and issuing of the company's financial statements, providing accurate and timely information to management and ensuring that all regulatory reporting requirements are met. In financial accounting, the goal is to consistently provide the valuable, accurate and reliable information.

The issuing of the financial statements is the responsibility of the financial accounting department. These statements summarize the business's activities for the year and are used by shareholders, banks, employee bargaining units, and the general public to evaluate the financial worth of the company. The statements are audited by independent accountants to validate the information and provide assurance to readers.

The financial statements are comprised of five documents; balance sheet, income statement; cash flow and owners or shareholders equity and notes. Notes to the financial statement are written explanations of items in the financial statements. Any unusual items or change in procedure that has impact on the financial statements are detailed here.

The balance sheet is a summary of all the assets and liabilities at year's end. The accounts reflect the total amount of cash and liquid assets on hand, the amount of debt the company is carrying, and how much money was spend in various categories. Financial accounting firms perform analysis of these values using ratios and other calculations to determine the financial health of the company.

An income statement is a critical component in financial accounting. It provides a clear list of all the sales for the year, the expenses and the net profit or loss of the firm. This statement provides insight into the sales performance for the year and the overall profitability of the firm.

A cash flow report provides details on funds received and disbursed. Funds received or lost from interest bearing investments are detailed here.

The statement of owners' or shareholders' equity shows the total net income from the year and how it will be distributed among the shareholders or reinvested in the business. Publicly traded companies must provide the number of shares issues, the type of share and the amount of divided to be paid on the shares, based on the articles of incorporation and the shareholder agreement.

All certified public accountants have complete intermediate and advanced courses in financial accounting. There is no additional designation for a financial accounting specialty. The skill set for a financial accountant must focus on analysis and data manipulation software and tools.

 

Concept

The concept of financial accounting centers around a basic equation: assets equal liabilities plus owner’s equity. This equation provides the building blocks for the remainder of accounting principles. Other basics include debits and credits, selecting an accounting method for recording financial transactions, maintaining the general ledger, and preparing financial statements. Individuals often learn the basics of financial accounting by either working at a job that involves accounting or pursuing an educational degree with an accounting specialization. Through these options, individuals will learn what is often called the language of business: accounting.

The accounting equation includes the three main categories for all financial information: assets, liabilities and owner’s equity. Assets are all items a company owns and uses to generate sales revenue and profit. Current assets last 12 months or less, and include items like cash, inventory, short-term securities and accounts receivable. Long-term assets represent buildings, equipment, vehicles, land and other major purchases that help the company transform raw materials into sellable products. Liabilities include money borrowed and owed to other individuals or businesses. These are also current or long-term, with the former including accounts payable, credit lines and short-term loans, and the latter including mortgages or long-term loans. Owner’s equity represents the portion of income the business owner retains as his portion of net income.

Under the basics of financial accounting, companies must select an accounting method. The two most common are the cash basis method and the accrual accounting method. Cash basis accounting requires companies to record financial transactions whenever cash changes hands. Many small businesses use this method; large companies, however, are not allowed to use this method per national accounting standards. The accrual accounting method requires companies to record transactions as they occur, regardless of cash changing hands during the transaction. This method creates a better historical record of financial transactions.

The basics of financial accounting also require each transaction entry to have a debit and credit. Debits represent the left side of T accounts in the general ledger and credits represent information on the right of the account. Debits increase asset accounts and decrease liabilities or revenue accounts; credits have the opposite effect of debits for these accounts.

The basics of financial accounting also helps a company to keep an accurate ledger that consists of all the accounts it will use to record financial transactions. The aggregation of these accounts will result in a financial statement providing all users of the statement with an accurate presentation of the company’s financial health. Income statements list the revenue and expenses; balance sheets list the assets, liabilities and owner’s equity; and the statement of cash flows includes all movements of cash within the company.

 Importance and Scope

Financial accounting, which some call "the language of business," is important to companies of any size. For small-business owners, the importance of financial accounting sometimes is overlooked. By understanding how useful financial accounting can be to the success of a small business, you can focus on the qualities that can take your business the furthest.

 Recording Transactions

A major use of financial accounting is for the recording of transactions. This function of accounting is also known as bookkeeping. Small-business owners use financial accounting to record business activity in the company's ledger. Because financial accounting uses the double-entry system, each transaction affects two accounts, representing the two sides to a transaction. For example, if a business owner purchases land for cash, he would record a debit to the land account to represent the receipt of land, and a credit to the cash account to represent the outflow of cash. This use of accounting is important to small-business owners because it provides a methodological approach to describing the activities of business.

 Communicating Information -- External

Small-business owners use financial accounting to communicate information to external parties. People and organizations that use the financial information of a company, but are not part of the company, are known as external users of financial statements. Owners communicate the financial health and well-being of a company to external users through the financial statements, which are the end result of recording financial accounting transactions. External users will examine the financial statements and compare the results to their own expectations, forming an assessment of the company. Common external users include banks, suppliers and leasing companies.

 Communicating Information -- Internal

While managerial accounting is more geared towards internal users, financial accounting is also used for internal information communication. Internal users of financial accounting information include the finance team and employees who may be interested in profit-sharing or stock-based compensation agreements. Small-business owners can use financial accounting information to share company strengths and weaknesses with employees. For small public companies, a common metric is the company's share price. Owners may tie bonus and compensation amounts to share price and encourage employee productivity accordingly.

 Analysis and Comparison

Small-business owners may use financial accounting information to analyze competitors and evaluate investment opportunities. Because financial accounting is governed by generally accepted accounting principles, the financial statements of different companies are comparable to one another. This basis for comparability provides a standard method of analysis. Small-business owners can compute financial ratios using the company's financial statements, and compare the ratios to benchmarks or other competitors. 

Management Accounting

Management accounting is a specialized sub-set of accounting, focusing on internal needs of businesses. While financial accounting focuses on external reporting and history, management accounting focuses on current information and the needs of in-house management. Both management and financial accounting work together to give management and external users the information required. Often a management computer system feeds into a financial computer system, providing users and stakeholders with complete cost information.

Popular with manufacturing environments, management accounting focuses on assigning costs to processes. Instead of dealing with debits and credits, accounts or financial statements, as financial accounting does, this style of accounting quantifies details, quality controls, and expectations. Cost Accounting is one of the main principles of management accounting. It is used to determine budgets, costs, and profitability of products or departments.

Cost accounting deals with 3 main areas. The first is raw materials, or the resources needed to complete a product. This could include, for example, costs of leather and wood to build a piece of furniture. Labor, or the salaries of employees working on a process, is the second area, and would include the cost of a carpenter building a piece of furniture. Third is indirect costs, also known as "overhead;" this would include the cost of liability insurance in a plant.

Standard cost accounting includes the concepts of fixed and variable costs, as analysis are performed to identify how variable costs affect the cost of a product excluding fixed costs and vice-versa. Budgets are created based on standard costs and variances are identified and analyzed. It is a popular tool used by many manufacturing plants and other businesses.

Another way of looking at management and cost accounting is by using Activity Based Accounting, also known as ABC. This method tries to measure actual activity costs to assign indirect costs to products. It is usually expensive to implement this system, since activities and ways of measurement may vary dramatically.

Most management accounting processes are performed using computer systems that can handle large amounts of data and make the data usable by users. Computer systems and the Information Technology (IT) department are very important in management accounting. With this importance comes expenses associated with the IT department; that is why IT cost transparency is part of management accounting. There is a need for IT costs to be measured and controlled the same way that other processes are. 

Need

Business owners often use management accounting to track, record and report financial information for managerial review. Management accounting does not usually follow any national accounting standards. Business owners can design management accounting systems according to their company’s business operations or managements need for business information. Management accounting has several advantages. These advantages usually coincide with the ability for companies to improve operations and overall profitability. Business owners can also create a competitive advantage by developing cost allocation processes in their management accounting function.

 

Reduce Expenses

Management accounting can help companies lower their operational expenses. Business owners often use management accounting information to review the cost of economic resources and other business operations. This information allows owners to better understand how much money it costs to run the business. Business owners can also use management accounting to conduct an analysis on the quality of economic resources used to produce goods or services. If overall product quality would not suffer by using a cheaper raw material, business owners can make this change to reduce production costs.

 

Improve Cash Flow

Budgets are a major part of management accounting. Business owners often use budgets so they have a financial road map for future business expenditures. Many budgets are based on a company's historical financial information. Management accountants will comb through this information and create a master budget for the entire company. Larger business organizations may use several smaller budgets for divisions or departments. These individual budgets usually roll up into the company's overall master budget. The main purpose of budgets is to save the company money through careful analysis of necessary and unnecessary cash expenditures.

 

Business Decisions

Management accounting often improves the business owner’s decision-making process. Rather than making business decisions based solely on qualitative analysis, business owners or managers can use management accounting information as a decision-making tool. Management accounting usually provides a quantitative analysis for various decision opportunities. Business owners can review each opportunity through the prism of quantitative analysis to assure they have a clear understanding relating to business decisions.

 

Increase Financial Returns

Business owners can also use management accounting to increase their company’s financial returns. Management accountants can prepare financial forecasts relating to consumer demand, potential sales or the effects of consumer price changes in the economic marketplace. Business owners will often use this information to ensure they can produce enough goods or services to meet consumer demand at current prices. Companies also pay close attention to the amount of competition in the economic marketplace. Competition can reduce the company’s financial returns from business operations.

 

Importance and Scope

Managerial accounting information provides data-driven input to these decisions, which can improve decision-making over the long term. Small business managers can leverage this powerful tool to help make their business more successful by understanding how management accounting benefits common business decision contexts.

 Relevant Cost Analysis

Managerial accounting information is used by company management to determine what should be sold and how to sell it. For example, a small business owner may be unsure where he should focus his marketing efforts. To evaluate this decision, an accounting manager could examine the costs that differ between advertising alternatives for each product, ignoring common costs. This process is known as relevant cost analysis and is a technique that is taught in basic managerial accounting courses. The same process can be used to determine whether to add product lines or discontinue operations.

 Activity-based Costing Techniques

Once the company has determined what products to sell, the business needs to determine to whom they should sell the products. By using activity-based costing techniques, small business management can determine the activities required to produce and service a product line. Embedded in this information is the cost of customers. Deciding which customers are more or less profitable allows the business owner to focus advertising toward the consumers who are the most profitable.

 Make or Buy Analysis

A primary use of managerial accounting information is to provide information used in manufacturing. For example, a small business owner may be considering whether to make or buy a component needed to manufacture the company's primary product. By completing a make or buy analysis, she can determine which choice is more profitable. While this technique is certainly useful, small business owners should only use these analyses as a factor in the decision. There could be other non-financial metrics that are important to consider that would not be part of the analysis.

 Utilizing the Data

Managerial accounting information provides a data-driven look at how to grow a small business. Budgeting, financial statement projections and balanced scorecards are just a few examples of how managerial accounting information is used to provide information to help management guide the future of a company. By focusing on this data, managers can make decisions that aim for continuous improvement and are justifiable based on intelligent analysis of the company data, as opposed to gut feelings.

Cost Accounting

Cost accounting is an approach to evaluating the overall costs that are associated with conducting business. Generally based on standard accounting practices, it is one of the tools that managers utilize to determine what type and how much expenses is involved with maintaining the current business model. At the same time, the principles of cost accounting can also be utilized to project changes to these costs in the event that specific changes are implemented.

When it comes to measuring how wisely company resources are being utilized, cost accounting helps to provide the data relevant to the current situation. By identifying production costs and further defining the cost of production by three or more successive business cycles, it is possible to note any trends that indicate a rise in production costs without any appreciable changes or increase in production of goods and services. By using this approach, it is possible to identify the reason for the change, and take steps to contain the situation before bottom line profits are impacted to a greater degree.

Product development and marketing strategies are also informed by the use of cost accounting. In terms of product development, it is possible to determine if a new product can be produced at a reasonable price, considering the cost of raw materials and the labor and equipment necessary to produce a finished product. At the same time, marketing protocols can make use of this type of accounting to project if the product will sell enough units to make production a viable option.

Cost accounting is helpful in making a number of business decisions. By weighing the actual costs versus the anticipated benefit, it can help a company to avoid launching a product with no real market, prevent the purchase of unnecessary goods and services, or alter the current operational model in a manner that will decrease efficiency. Whether utilized to evaluate the status of a department within the company or as a tool to project the feasibility of opening new locations or closing older ones, cost accounting can provide important data that may impact the final decision.

References

https://www.youtube.com/watch?v=AtC20dh02SQ

https://www.youtube.com/watch?v=mq6KNVeTE3A

https://www.youtube.com/watch?v=9XTrTqOBtN0

https://smallbusiness.chron.com/management-accounting-important-decisionmaking-53947.html

https://www.smartcapitalmind.com/what-is-management-accounting.htm

 

Organisational Behaviour

Organizational behavior is based on a few fundamental concepts which are relevant to the nature of people and organizations. There are some basic assumptions in organizational behavior such as, (1) difference between individuals; (2) a whole person; (3) behavior or an individual is caused; (4) an individual has dignity, (5) organizations are social systems; (6) mutuality of interest among organizational members; (7) holistic organizational behavior. 

Now let’s look at all assumptions in detail:

1. Individual differences idea comes from psychology. Every person is different from the day of birth, every person is unique and personal experiences make a person more different than the other. Every individual differs in many ways like intelligence, physique, personality, learning capability, communicative ability etc. Therefore only an individual can take responsibility and make decisions, whereas a group is powerless until all the individuals within the group act accordingly.
2. A whole person indicates that when an individual is appointed in an organization, he/she is not hired only on the basis of skills, but also on likes and dislikes, pride and prejudices. An individual’s way of living in a family cannot be separated from organizational life. This is why the organizations need to provide their employees with a proper work environment where they can work hard to progress and develop their abilities to become a better employee and also a better person in terms of growth and fulfillment.
3. Caused behavior indicates that when an individual behaves in an unmannerly fashion then there is a cause behind it. Anything could be the reason of this cause such as personal problems at home within the family, or problems with coming early to the office etc. If an individual starts reacting in an unmannerly fashion with other staff members then a manager should understand that there is definitely a cause behind it. Managers should investigate about the cause and tackle the issue at the root level.
4. Human dignity indicates that every individual needs to be treated differently. It shows human dignity because people at every level of professional ladder want to be treated with respect and dignity. Every job needs to be done with respect and recognition this helps every individuals aspirations and abilities to improve. The concept of human dignity rejects the idea of using employees as economic tools.
5. Organizations are social systems indicates that from sociology we know that organizations are social systems; therefore the activities within the organizations are governed by social and psychological laws. Organizations have formal and informal social systems. Social systems in an organization indicate that the company has dynamic change ability rather than static set of relations. Every part in the system is interdependent on each other.
6. Mutuality of interest indicates that both the organization and people need each other. Organizations are formed and maintained on the basis of some mutuality of interest among the participants. People require organizations to reach their goals, while organization needs people to reach organizational objectives. Lack of mutual interest causes disorientation among the participants and the group. Mutual interest provides a common goal for all the participants, which results in encouragement of the people to tackle problems of the organization instead of raising fingers at each other.
7. Holistic concept indicates that when all the above six concepts of organizational behavior are placed together a holistic concept arises. This concept interprets the relationship between people and organization in terms of the whole person, entire group, entire organization and the whole social system. Views of different people are taken into account in an organization to understand the factors that influence their behavior. Issues are analyzed in terms of the total situation affecting them rather than in terms of an event or problem.

There are many factors that affect an individual, a group and an organization. For example factors individual factors like personality, perception, learning, attitude, job satisfaction and motivation. Group factors like leadership, power and politics, communication and conflicts. Organization factors like human resource policies and practices, work stress, change and development.

 

Examples of Organizational Behavior

Findings from organizational behavior research are used by executives and human relations professionals to better understand a business’s culture, how that culture helps or hinders productivity and employee retention, and how to evaluate candidates' skills and personality during the hiring process.

Organizational behavior theories inform the real-world evaluation and management of groups of people. There are several components:

• Personality plays a large role in the way a person interacts with groups and produces work. Understanding a candidate's personality, either through tests or through conversation, helps determine whether they are a good fit for an organization.
• Leadership—what it looks like and where it comes from—is a rich topic of debate and study within the field of organizational behavior. Leadership can be broad, focused, centralized or de-centralized, decision-oriented, intrinsic in a person’s personality, or simply a result of a position of authority.
• Power, authority, and politics all operate inter-dependently in a workplace. Understanding the appropriate ways these elements are exhibited and used, as agreed upon by workplace rules and ethical guidelines, are key components to running a cohesive business.

Reference

https://www.investopedia.com/terms/o/organizational-behavior.asp

https://www.mbaknol.com/organizational-behavior/organizational-behavior-definition-and-concepts/

https://www.youtube.com/watch?v=QJAv6674_Sw