UNIT 11: INTERNATIONAL MARKETING

PRE-READING TASKS
1. Write your own definition of the word “international marketing”
2. Compare your definition above with the four definitions below.
Which definition is closet to yours?
1. the multi-national process of planning and executing the
conception, prices, promotion and distribution of ideal goods and
services to create exchanges that satisfy the individual and
organizational objectives.
2. the application of marketing principles to more than one country.
3. refers to “marketing activities coordinated and integrated across
multiple country markets."
4. simply the application of marketing principles to more than one
country.

I. READING COMPREHENSION
International Marketing refers to the marketing of a firm‟s products
in foreign countries. International marketing is difficult because
businesses need to deal with external factors and constraints such
as differences in political systems, legislation and cultures. In
addition, customers will probably need an amended marketing mix
to suit the local market. A lack of comprehension of different
cultures can prove troublesome. In 2006 Walmart, the world‟s
largest retailer had to sell its store in Germany to local rival Metro
when it discovered that is American practices (such as helping

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customers to pack their bags at the supermarket) were unsuccessful
and did not suit the German cultures.
Global marketing, an extension of international marketing, refers to
selling a product using the same marketing approach throughout the
world. By contrast, international marketing refers to differentiated
marketing that is tailored to suit different countries. Globalization and
the aggressive growth strategies of some large multinationals have
promoted the increased use of international marketing.
There are various strategies that a business can use to market its
products overseas. These strategies include internal methods (such as
exporting, direct investment and e-commerce) and external methods
(such as joint ventures, strategic alliances, franchising, mergers, and
acquisitions)
Exporting - Here, the business operating in the domestic country sells
its products directly to an overseas buyer. The advantage of this is that
it eliminates the need to set up a business abroad (with it associated
costs and risks).
Direct investment - This refers to a business setting up production
and/or distribution facilities in foreign countries. Having a wider
distribution channel gets over the problem of exporting (which limit
the potential number of foreign buyers). Honda, Toyota and Nissan all
have manufacturing plants in the EU, for example. This allows the
Japanese car producer to gain access to the huge market in the
European Union. BMW‟s manufacturing plant in Chennai (India‟s
fourth largest city) help the Germaine firm to avoid a 60 per cent
important tax on its cars. However, the main drawback of this method
in the high cost of the investment.
E-commerce - This is trading via the internet. It is an effective way to
reduce the cost and risks of international marketing. Online retailers,
such as Amazon.com and eBay, have gained access to foreign markets
without having to physically set up retail stores.

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Joint ventures - This occurs when two or more companies invest in a
shared business project, pooling their resources to form a separate
business. Many foreign firms have formed joint ventures with Chinese
and Indian companies to gain access to the growing markets. For
example, in 2007 Exon a joint venture with China‟s Sinopec and
Saudi Aramco (the largest supplier of oil to China) in a $5 billion
deals. The project involves the three firms being involved in oil
supply, refinery and retail in China.
Strategic alliances - These are similar to joint ventures in that several
businesses pool their human, capital and financial resources in a
shared project. However, they do not form a new business with a
separate legal identity. Again, strategic alliances with foreign firms
can allow a business to gain access to overseas markets. For example,
Nissan (Japan‟s second largest car manufacturer) and Renault (a
predominant French vehicles producer) formed an alliances places the
companies fourth in global sales (after Toyota, GM and Ford) with an
approximate 10 per cent of the world market share.
Franchising - This involves a business allowing others to trade under
its name in return for a fee and a share of revenues. McDonald‟s,
KFC, Pizza Hut and Burger King use this growth strategy to market
their product overseas. Alternatively, business may use licensing
where buy another firm buys the right to produce the goods of the
business. Nike licenses the production of their sports shoes and
sportswear to business in Indonesia; Disney licenses the production of
their soft toys and other merchandise to business in Viet Nam.
Mergers - These take place when two businesses agree to integrate as
a single organization. Merging with a foreign company can help
businesses to gain access to overseas markets. For example, Mittal
Steel Company (owned by the UK‟s richest man, Lakshmi Mittal) and
Luxembourg‟s Marcelo merged in 2006 to form Marcelo-Mittal, the
world‟s largest steel company.

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Acquisitions - Acquisitions (or takeovers) occur when one business buys
out another by purchasing a majority stake in the target company.
(Adapted from www.marketing-schools. org)
Comprehension questions
1. What is the difference between „international‟ and „Global‟ marketing?
2. Explain why international marketing can be an important issue to
businesses?
3. How can international marketing help a business to sell their products?
4. What are strategies that a business can use to market its products
overseas?
5. What is the E-commerce?
6. What are Strategic alliances?

II. GRAMMATICAL REVIEW: Quantifiers

A. Review
In English grammar, a quantifier is a word (or phrase) which indicates
the number or amount being referred to. It generally comes before the
noun (or noun phrase). Quantifiers are used at the beginning of noun
phrases:
 before a noun on its own: fewer answers
 before an adjective and noun: some useful phrases
 before an adverb, adjective and noun: every really pleasant experience
Normally two quantifiers cannot be used together before the same
noun. However, the quantifiers all and both are found immediately
before the or a possessive pronoun: all my relatives, both the
ministers. You will also see the following combinations of quantifiers:
 a little less noise
 a few more questions
 every few minutes

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The chart below shows which type of noun goes with which quantifier.

Quantifier Countable nouns Uncountable

nouns
Singular nouns Plural nouns
All - Yes Yes

Any No, but see note Yes Yes

Both * yes *
Each yes - -
Enough - Yes Yes
Every Yes - -
Few/a few/fewer - Yes -
Little/a little/less - - Yes
Lots of/a lot of - Yes Yes
Many - Yes -
More - Yes Yes
No Yes Yes Yes
Several - Yes -
Some - Yes Yes

Notes
 Many, much, a lot of
These are all used to talk about a large quantity of something; many is
used only with C nouns, much with U nouns and a lot of can be used
with both.
Only many and much can be preceded by the words how, to form
questions (how many / how much ...?). The word too can be used to

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express a negative idea (too hot, too cold) and so, to show the
speaker's attitude to the quantity (so many that ... /so much he couldn't
...). Many and much tend to be rather formal in use and are therefore
often found in legal documents, academic papers and so on; in speech
we often use phrases like a lot of, loads of, tons of, hundreds of
 Few, little
the meaning of these two words is similar since they both refer to
small quantities, except that few is found with C nouns and little with
U nouns.
If they are used without the indefinite article, a, they have the sense of
not enough and are negative in feeling (few events, little interest) but
these are quite formal and we would normally prefer not many events
and not much interest.
When few and little are used with a they simply mean a small quantity
with no extra negative overtones: a few events (i.e. three or four) and a
little interest (i.e. some interest, but not a lot).
 Any
Any can be used before countable and uncountable nouns usually in
questions and negative sentences:
E.g: Are you bringing any friends with you?
Do you have any coffee?
I can't remember any songs.
He isn't taking any chances.
If we stress the word any heavily when speaking, we are suggesting an
unlimited choice from a range of things or an unrestricted quantity; in
this case its use is not confined to just questions and negatives:
E.g: Yourself to any sandwiches. (the choice is yours)
Don't you like any Beatles song? (I can't believe you dislike them all)
I can't see any difference. (nothing at all)

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 Some
Some is usually thought of as the positive counterpart to any in many
circumstances.
E.g: I'm bringing some friends with me.
I have some coffee.
Like any it is used before both C and U nouns, and means an
indefinite quantity but not a large amount. The general rule given
above for the use of any in negative sentences and questions does not
always hold in requests and offers where we often use some to mean a
small amount of a known quantity:
E.g: Would you like some cake? (here is the cake, do you want a
piece of it?)
Could I have some biscuits instead? (any would not be possible in this
case)
If we stress the word some in positive and negative sentences and in
questions, we are suggesting a limited quantity or number of something:
E.g: I like some Beatles songs. (But certainly not all!)
I can see some difference. (But not a lot!)

B. Drilling exercises
Choose the best answer to fill in the blank
1. We are going to be late. There is too ______________
(much/many) traffic.
Yeah, the ______________ (amount/number) of people driving is
incredible
I have never seen this ______________ (much/many) cars.
2. Can you bring soda to the picnic? I don‟t have ______________
(some/any)

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Yeah, I think I‟ve got ______________ (some/any) left over from the
party.
3. How do you feel about your new job? Do you have as
______________ (much/ many) responsibilities as you used to?
The job is great. I have about the same ______________
(amount/number) of work to do as before, but I have ______________
(less/fewer) stress and ______________ (less/fewer) problems.
4. How do you think you did on the test? I think I did
______________ (little/a little) better than last time, maybe even
______________(a lot/many) better. What about you?
Well, I think I probably made ______________ (few/a few) mistakes,
but I have the feeling I did well overall.
5. Mr. President, do you think ______________ (much/many) of your
proposed legislation will be passed by congress during this session?
Yes, I think ______________ (a great deal/a great many) of our
proposals will be approved. We‟ve not taking ______________
(nothing/anything) for granted, though. We still have
______________ (a great deal/a great many) work to do.

III. WORD STUDY

Exercise 1: Fill in the blank with a suitable word.

smaller market decisions etiquette strategy purchasing

research value preference branding regional marketing

Businesses that are able to adopt global marketing strategies benefit

from being able to market a single the product in exactly the same
way throughout the world. After all, having to adapt products to suit
local (1) _________________ or cultures can be expensive. The
dilemma facing managers is trying to gain economies of scale by

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using a single global (2) _________________ yet still cater for local
or regional likings and tastes. While it is possible for large
multinationals such as Coca-Cola and McDonald‟s to make the
odd costly mistake, smaller companies cannot afford to do so.
(3) _________________ firms therefore need to ensure that their
international marketing strategy is very carefully researched and
planned since failure overseas can be fatten to the business.
Branding can be very powerful tool in (4) _________________ a
product overseas. Scientists, psychologists and economists have all
produced evidence to show that (5) _________________ can have a
huge affect on the buying decisions made by consumers. It is very
common that consumers make their purchasing (6) _______________
based on the perception of a brand rather than the qualities of the
actual product. To extend the success overseas requires careful market
research and planning. A successful brand in one part of world does
not mean that the same formula will work in other parts of the globe.
Matt Haig, author of Brand Failures, found that highly successful
brands can lose their (7) _________________ overnight because
customer perception of products and brands can be fragile.
It is also important that managers remember not to assume that people
overseas behave in the same way that they are personally accustomed
to. David Ogilvy, a world renowned advertising executive, argues that
firms trying to market their products to different people should use
local language, i.e. The language in which these people think.
International business (8) _________________ is particularly
important when doing business in other people‟s territory. The key
point is that an awareness and understanding of the business context,
the people involved and ethics of different cultures should facilitate a
more successful business strategy
Exercise 2: Word formation.
Ethics is another culture-related issue that can present problems for
(1) _________________ (NATION) marketing. What is acceptable in

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one country may not be (2) _________________ (ACCEPT) in
another. In modern societies, the employment of children is likely to
be illegal. In other countries, the use of child labour is seen as vital to
their (3) _________________ (ECONOMY) development. Due to
religious reasons, Muslim women need to be dressed in a
conservative way, even whilst on holiday, but the men are free to
dress as (4) _________________ (CASUAL) as they see fit - is this
fair? To whom? Smoking is allowed to be heavily advertised in some
parts of the world whilst it is banned in other parts. Pester power
marketing aimed at young children are banned in the European Union
but not in many other parts of the world.
A final cultural issue that businesses must consider when marketing
overseas is the (5) _________________ (DIFFER) in international
business etiquette. This refers to the mannerism and custom by which
business is conducted in different countries. An (6) _______________
(AWARE) and understanding of differences in business etiquette and
(7) _________________ (CULTURE) factors have become crucial
elements of international marketing. A lack of awareness of the
different ways in which business is conducted throughout different
parts of the world could mean that the business fails to secure deals or
contracts with foreign (8) _________________ (FIRM) .
Exercise 3: Match the words or word phrases with its definitions.

1. Direct investment a. Refers to the use of telephone

systems (audio and text messaging)
to sell products directly to potential
customers.
2. Exporting b. The sellers of products to the
general public (i.e. consumers) that
operate in outlets.
3. Business etiquette c. Refers to a business setting up
production and/ or distribution
facilities overseas.

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4. Global marketing d. The practice of selling domestically
produced goods and/ or services to
overseas buyers to gain access to larger
international markets.
5. International marketing e. The marketing of a product by
using the same marketing strategy in
various countries to gain from
marketing economies of scales.
6. Global marketing presence f. The marketing of a firm‟s product
in foreign countries.
7. Telemarketing g. Refers to the mannerism in which
business is conducted. It varies from
one country to another so marketers
must be aware of the different
protocols that exist.
8. Retailers h. Refers to a business with strong
global brands that often have a
significant share of their revenues
earned from overseas markets.
i. Refers to promotional material sent
directly to people‟s homes or place of
work.
j. Refer to a person who want to buy
goods.
k. An accounting term referring to a
listing of a company‟s assets, liabilities
and surplus as of a specific date.
l. Annual net investment income after
expenses, divided by the mean of
cash and net invested assets.

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IV. TRANSLATION
Opportunities and benefits of international marketing
Business may aim to market their products to an international
audience for several reasons:
Increased customer base - The size of market can be enlarged by
marketing products to overseas buyers. This should lead to greater
market share for the business.
Economies of scale - By operating of larger scale, a business is likely to
benefit from cost savings knows as economies of scale. These cost-
reducing benefits can enable growing firms to gain higher profit margin
or to reduce their prices (thereby giving them a price advantage).
Increase brand recognition - Having a standardized marketing
strategy across the world (such as using identical packaging and
advertising) not only reduces average cost of production, but can also
lead to greater international recognition of a brand. This may lead to
improved brand loyalty and sales.
Spread risks - By operating in various countries, a business is less
exposed to the risks in one particular country (such as a recession or
changes in fashion).
Extend the product life cycle - A business might find that the domestic
market for its product in saturated or in decline. By marketing the
product overseas, the firm can expand its life cycle to generate higher
revenues. Mobile phone companies use this strategy when selling
older models of their phones in less affluent countries.
Gain more profit - Ultimately, all the reasons above for international
marketing help to generate more profits for the business. Overseas
markets provide an extra source of customers and can be very lucrative.

V. DISCUSSION PROMPTS
In groups, distinguish the differences between global marketing and
international marketing.

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 UNIT 12: BUSINESS PLANNING

PRE-READING TASKS
1. What is a business planning?
2. What factors do you think determine the content and format of a
business planning?

I. READING COMPREHENSION
The business plan sets out how the owners/managers of a business
intend to realize its objectives. Without such a plan a business is likely
to drift. The business plan serves several purposes: It enables
management to think through the business in a logical and structured
way and to set out the stages in the achievement of the business
objectives. It enables management to plot progress against the plan. It
ensures that both the resources needed to carry out the strategy and the
time when they are required are identified. It is a means for making all
employees aware of the business's direction. It is an important
document for discussion with prospective investors and lenders of
finance. It links into the detailed, short-term, one-year budget,
prepared for a one-year accounting period, containing the plans and
policies to be pursued during that period. The main purposes of a
budget are to monitor business unit and managerial performance, to
forecast the out-turn of the period's trading and to assist with cost
control. Generally, a functional budget is prepared for each functional
area within a business such as call-centre, marketing, production,
research and development, finance and administration. In addition, it
is also normal to produce a "capital budget" detailing the capital

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investment required for the period, a "cash flow budget", a "stock
budget" and a "master budget", which includes the budgeted profit and
loss account and balance sheet.
A business plan has to be particular to the organization in question, its
situation and time. However, a business plan is not just a document, to
be produced and filed. Business planning is a continuous process. The
business plan has to be a living document, constantly in use to
monitor, control and guide the progress of a business. Before
preparing a business plan, managers should review previous that
business plan and it outcome. This review will help highlight which
areas of the business have proved difficult to forecast historically.
A business plan must have a purpose, set out the key business
assumptions on which their plans will be based (such as inflation,
exchange rates, market growth, competitive pressures and so on) and
take a critical look at their business. The classical way is by means of
the strengths - weaknesses - opportunities - threats (SWOT) analysis,
which identifies the business's situation from four key angles. The
strategies adopted by a business will be largely based on the outcome
of this analysis. A typical business plan looks up to three years
forward and it is normal for the first year of the plan to be set out in
considerable detail. This one-year plan, or budget, will be prepared in
such a way that progress can be regularly monitored by checking the
variance between the actual performance and the budget, which will
be phased to take account of seasonal variations.
The budget will show financial figures and also non-financial items
such as personnel numbers, output, order book, etc. Budgets can be
produced for units, departments and products as well as for the total
organization. Budgets for the forthcoming period are usually produced
before the end of the current period. While it is not usual for budgets
to be changed during the period to which they relate (apart from the
most extraordinary circumstances) it is common practice for revised
forecasts to be produced during the year as circumstances change.

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A further refinement is to flex the budgets, i.e. to show performance at
different levels of business. This makes comparisons with actual
outcomes more meaningful in cases where activity levels differ from
those included in the budget. What Providers of Finance Want from a
Business Plan Almost invariably bank managers and other providers
of finance will want to see a business plan before agreeing to provide
finance. Not to have a business plan will be regarded as a bad sign.
They will be looking not only at the plan, but at the persons behind it.
They will want details of the owner/managers of the business, their
background and experience, other activities, etc. They will be looking
for management commitment, with enthusiasm tempered by realism.
The plan must be thought through and not be a skimpy piece of work.
A few figures on a spreadsheet are not enough. The plan must be used
to run the business and there must be a means for checking progress
against the plan. An information system must be in place to provide
regular details of progress against plan.
Bank managers are particularly wary of businesses that are slow in
producing internal performance figures. Lenders will want to guard
against risk. In particular they will be looking for two assurances: (1)
that the business has the means of making regular payment of interest
on the amount loaned, and (2) that if everything goes wrong the bank
can still get its money back (i.e. by having a debenture over the
business's assets). Forward-looking financial statements, particularly
the cash flow forecast, are therefore of critical importance. The bank
wants openness and no surprises. If something is going wrong it does
not want this covered up, it wants to be informed - quickly.
(Adapted from “Introduction to BUSINESS MANAGEMENT” 8th
Edition, Oxford University Press, Southern Africa)

Comprehension questions
1. Why does a manager have to set up a business plan?
2. What are the main purposes of a business plan?

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3. Why should managers review the previous business plan and its
outcome before preparing a business plan?
4. What is SWOT analysis?
5. Why will Providers of Finance Want from a Business Plan want to
see a business plan before agreeing to provide finance?
6. What are the assurances that the Lenders base on to guard against
risk?

II. GRAMMATICAL REVIEW: Comparisons

A. Review
Comparison is a feature in the grammar of some languages, whereby
adjectives and adverbs are inflected or modified to produce forms
which indicate the relative degree of the designated properties. The
grammatical category associated with comparison of adjectives and
adverbs is degree of comparison. The usual degrees of comparison are
the positive, which simply denotes a property; the comparative,
which indicates greater degree; and the superlative, which indicates
greatest degree.
Comparatives
You can also add “-er” to one-syllabus adjectives or adverbs. “-er”
means “more.” (If you want to compare one item to another, you have
to use “than,”.)
E.g: Bigger; taller; larger; happier
The garden in that house is larger than this one.
She prefers the bigger.
He runs faster than anyone in the class.
*If you add “-er” to an adjective or adverb that ends in “-y”, you have
to change the “-y” to “-i”, and then write “-er”.

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E.g: Wrong: funnyer (x)
Right: funnier
*If an adjective ends in “vowel-consonant,” you have to double the
consonant before adding “er”.
E.g: Wrong: biger (x), thiner (x)
· Right: bigger, thinner
You can also add “-er” to a two-syllabus adjective or adverb if that
ends in “-et”, “-ow”.
E.g: quieter, narrower
With longer adjectives, you add the word “more” or “less” in front of
the adjective
E.g: important → more important
interesting → more interesting
beautiful → more beautiful
The first part of the film was more interesting than the second one.
This room is less comfortable than the first one.
Jose drives more carefully than Mary does.
To say that 2 things/ 2 people are the same, you use “as +
adjective/adverb + as.”
E.g: My car is as big as yours.
Keith is as old as Jake.
My brother drives as carelessly as a cowboy does.
You can also say that something is “not as + adjective/adverb + as”
something else. This is the opposite of “more + adjective/adverb.”
E.g: The elephant is bigger than the mouse.
→ The mouse is not as big as the elephant.

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 Your test score is better than mine.
→ My test score is not as good as yours.
Jack types more carefully than Michael.
→ Michael doesn‟t type as carefully as Jack does.
Superlatives
You can also add “-est” to one-syllabus adjectives to indicate greatest
degree, the article “the” must be added in front of the adjective.
E.g: (the) biggest; (the) happiest
Nam is the tallest person in the class.
Math is the hardest subject in school.
*If you add “-est” to an adjective that ends in “-y”, you have to
change the “-y” to “-i”, and then write “-est”.
E.g: Wrong: funnyest (x)
Right: funniest
*If an adjective ends in “vowel-consonant,” you have to double the
consonant before adding “est”.
E.g: Wrong: bigest (x), thinest (x)
Right: biggest, thinnest
You can also add “-est” to a two-syllabus adjective if that ends in “-
et”, “-ow”.
E.g: quietest, narrowest
With long superlative adjectives, you have to use the + most/least +
adjective.
E.g: He is the most intelligent person in the class.
That is the least interesting game I‟ve ever played.

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With superlative adjectives, you don’t use the word “than‟ in the
superlative.
Some Comparative Adjectives are Irregular - this means that the
Comparative and Superlative forms are different, and you have to
memorize them.
Here is a list of the most common Irregular Adjectives

Adjectives Comparatives Superlatives

Good better best
Bad worse worst
Far farther/further farthest/furthest
Fun more fun most fun
much/ many more most
Little less least

B. Drilling exercises
Exercise 1: Put one suitable word in each space.
1. My brother is two years ________________ than me.
2. The train takes just ________________ long as the bus.
3. I've never tasted such delicious apples ____________ these.
4. I thought the second hotel was ________________ more expensive
than the first one.
5. Unfortunately we are ________________ well - off than we used to
be.
6. Marion doesn't feel so happy there ________________ she did at
first.
7. Do you think you could make a bit ________________ noise?

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8. These exercises seem to be getting harder and ______________
Jean doesn't need as much help as Harry ________________ David
didn't enjoy the match as________________ as I did.
Exercise 2: Rewrite each sentence beginning as shown, so that the
meaning stays the same.
1. Jill can run faster than Peter.
Peter ........................................................................................................
2. I didn't arrive as early as I expected.
I arrived ...................................................................................................
3. I have a brother who is older than me.
I have an ..................................................................................................
4. There aren't any trains earlier than this one.
This is ......................................................................................................
5. All other pubs are further away.
This pub...................................................................................................
6. Is this the best price you can offer?
Can't you .................................................................................................
7. That's the best meal I've ever eaten.
I've never eaten .......................................................................................
8. Fish and meat are the same price in some countries.
Fish cost just............................................................................................
9. If you run a lot, you will get fitter.
The more .................................................................................................
10. The doctor can't see you earlier than Wednesday I'm afraid.
Wednesday is ..........................................................................................

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III. WORD STUDY
Exercise 1: Fill in the blank with a suitable word.

process analysis production projections associations associates

cash product finance profit financial money

The most standard business plan covers topics including the company
overview, the (1) ________________ or service you are selling, the
target market and strategy of your company, your implementation
milestones and goals, management team, and (2) ________________
forecasting and analysis. The financial analysis includes the
company‟s projected sales, (3) ________________ and loss statement,
balance sheet, cash flow statement, and potentially a few other tables
depending on its intended use. The cash flow statement is usually
considered to be the most important part of your financial planning
and is a no-brainer for inclusion in the plan. Profitable or not, a
business‟s plan must show that it has enough (4) ________________
to remain operational. A standard business plan will start with an
executive summary describing the key points of your plan, and end
with appendices showing monthly (5) ________________ for the first
year. Though it is presented at the beginning of the plan, a good tip is
to write your executive summary last. This way, you‟ve been through
the business plan writing (6) __________________ already and you
can confidently select the highlights of your plan to showcase on the
first page.
A startup plan is a very simple business plan that typically includes
the following sections: an executive summary, a company overview, a
mission statement, and a market (7) ________________. Even if you
don‟t have the exact numbers yet, it‟s always a smart idea to include a
preliminary analysis of costs, pricing, and probable expenses. You can
use this kind of a business plan to discuss your options with potential
partners and (8) ________________. This kind of no-frills plan is

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good for deciding whether or not to proceed with an idea, to help
gauge whether this is a business worth pursuing.
Exercise 2: Word formation.
Internal plans will reflect the needs of the members of your company.
Since the purpose of an internal plan is specific to the people directly
involved with the company, it will most likely be shorter and more
concise than a fully detailed standard plan that you‟d take to the bank.
Internal plans are not intended for banks, outside (1) ______________
(INVEST) or other third parties.
An operation plan is a type of internal plan. An operation plan
includes specific (2) ________________ (IMPLEMENT) milestones,
project deadlines, and responsibilities of team members and managers.
This is the plan used for staying on track to meet your goals as a
business. Planning for your goals as a business allows your company
to assign priorities, focus on results and track your progress. Your
operation plan covers the inner workings of your business. Of course,
cash flow figures (3) ____________________ (PROMINENT) there
as well. For example, your milestones will need to have sufficient
funding for their implementation, and you‟ll need to track your
progress so you know how much you‟re spending. A (4) ___________
(GROW) or expansion plan focuses on a specific area of a business, or
a subset of the business. An expansion plan requiring new outside
investment would include full company (5) ________________
(DESCRIBE) and background on the management team, just the same
as a standard plan for investors would. Loan (6) ________________
(APPLY) would require this much detail as well. However, an
internal plan used to set up the steps for growth or expansion that is
funded (7) _______________ (INTER) could skip these descriptions.
It might not be necessary to include detailed (8) ________________
(FINANCE) projections for the company overall, but it should at
least include detailed forecasts of sales and expenses for the new
venture or product.

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Exercise 3: Match the words or word phrases with its definitions.

1. Budget a. A way of evaluating the strengths,

weaknesses, opportunities, and threats that
affect something.

2. Strategy b. The aggregation of all lower-level budgets

produced by a company's various functional
areas, and also includes budgeted financial
statements, a cash forecast, and a financing
plan.

3. Forecast out-turn c. A sum of money allocated for a particular

purpose.

4. Cash flow budget d. A process of evaluating how we invest in

capital assets.

5. Master budget e. Critical to not only for-profit businesses,

but also not-for-profit organizations to
ensure they have enough money to pay the
bills. These bills include day-to-day running
expenses and large sums predicted and
planned for in your annual budget.

6. Cash flow f. An outlay of cash for a project that is

expected to produce a cash inflow over a
period of time exceeding one year.

7. Capital budget g. An estimate of an expenditure made

analysis before the appropriation.

8. SWOT analysis h. A general and progressive increase in

prices.

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 i. An estimate of all cash receipts and all
cash expenditures that are expected to occur
during a certain time period. Estimates can
be made monthly, bimonthly, or quarterly,
and can include nonfarm income and
expenditures as well as farm items. Cash
flow budgeting looks only at money
movement, though, not at net income or
profitability.

j. The amount of money set aside for the

purchase of fixed assets (e.g., equipment,
buildings, etc.); a request for authorization to
purchase new fixed assets.

k. An elaborate and systematic plan of action

l. The excess of cash revenues over cash

outlays in a given period of time (not
including non-cash expenses).

IV. TRANSLATION
Planning has many benefits, and the more turbulent the environment,
the greater the necessity for planning. How do managers plan for the
future in an environment characterized by constant change, such as
the environment at the beginning of the second decade of the twenty
- first century?
Managers cannot predict the future, the planning exercise cannot
change the business environment and no plan can be perfect.
However, managers can plan to steer the organization in the best
possible direction, taking into consideration the organization‟s internal
strengths and weaknesses. Good managers understand that although

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they are leading the organization in a pre-determined direction, they
should anticipate change in the environment, and adjust their goals
and plans accordingly when necessary.
Since 2008, the world economy has spiraled into a serious recession,
yet some organizations managed to produce creditable results in 2009.
How did they do it? Some of the benefits of planning are listed below,
and examples from the SABMiller Annual Report of 2009 illustrate
how this global organization has used the benefits of planning to its
advantage, even in the bleak circumstances of 2009.

V. DISCUSSION PROMPTS
What to include in a business plan?
A business plan provides direction, keeping you on track and is
usually a requirement when you seek finance. Depending on your
business type, your plan could include the following sections:
 Title page - This describes what the plan is for and includes general
information on your business.
 Business Summary - A one-page overview written after your
business plan is finalised.
 About your business - This is typically called the management plan
or operations plan. It covers details about your business including
structure, registrations, location and premises, staff, and products/
services.
 About your market - This is the marketing plan. It should outline
your marketing analysis of the industry you are entering, your
customers and your competitors. This section should also cover your
key marketing targets and your strategies for delivering on these targets.
 About your future - This section covers your plans for the future
and can include a vision statement, business goals and key business
milestones.

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 About your finances - The financial plan includes how you'll
finance your business, costing and financial projections.
 Supporting documentation - List all of your attachments under this
heading in your plan for referral. For example: copies of emergency
procedures, maps, resumes, or financial tables.
Do you agree or disagree with these sections of a business planning?
Work in groups and give your opinions.

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 UNIT 18: LEADERSHIP & MANAGEMENT SKILLS

PRE-READING TASKS
1. Can you name a person who has had a tremendous impact on you as
a leader? Maybe someone who has been a mentor to you? Why and
how did this person impact your life?
2. What skills that you believe every leader should process?
 Management skills
 Presentation skills
 Soft-skills
 Problem solving skills

I. READING COMPREHENSION
Leadership is the process of influencing employees to work
willingly towards the achievement of organizational objectives. In
order to influence their subordinates to achieve goals, managers
should understand what motivates their employees are motivated to
work productively.
Management is that managers responsible for getting things done,
usually through other people or the process of realizing organizational
objectives through people and other resources. Management in all
business areas and organizational activities refers to the acts of getting
people together to accomplish desired goals and objectives.
Leadership is not the same as management. Management is broader
in scope, comprising four management functions, of which leading is

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only one. People can work as managers without being true leaders
since they do not have the ability to influence others. Conversely,
there are leaders in organizations who are not managers. For
example, the informal leader of a group may have more influence in
the group than the manager because of his/her ability to influence
group members.
Influencing is the process leaders follow when communicating ideas,
gaining acceptance of them, and inspiring followers to support and
implement the ideas through change. Influencing is also about the
relationship between leaders and followers. Managers may coerce
employees in order to influence their behavior, but leaders do not.
While leadership is not the only ingredient of organizational success,
it is one of the most important variables influencing this success. In
the South African business context, there are innumerable examples
where the success (or failure) of organizations is attributed to a
particular leader. In the dynamic and fast-changing business
environment of the twenty-first century, organizations need managers
who are also strong leaders. Organizations worldwide use the
extensive body of knowledge on leadership to improve the leadership
skills of their managers.
The components of the leading function
The authority relations created in organizations relate strongly to
the leading function of managers as the leading function gives
managers the right to use authority, power, responsibility,
delegation and accountability to influence employees to achieve the
organization‟s goals.
The components of the leadership entail the following: (1) Authority
denotes the right of a manager to give commands to, and demand
actions from, employees. (2)Power is a manager‟s ability to influence
his/her employees‟ behaviour. (3) Responsibility is the obligation to
achieve organizational goals by performing required activities.
Managers are responsible for the results of their organizations,

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departments or sections. (4) Delegation is the process of assigning
responsibility and authority or achieving organizational goals.
Managers delegate responsibility and authority down the chain of
command. Delegation refers to giving employees new tasks. Such a
task may become part of a redesign job or may simply be a once-off
task. (5) Accountability is the evaluation of how well individuals meet
their responsibilities. Managers are accountable for all that happens in
their sections departments. Managers can delegate authority and
responsibility, but they can never delegate their accountability.
Authority and power are probably the most important components of
leading and therefore deserve a few further remarks.
Authority
Managers are responsible for ensuring that employees work together
to achieve the organization‟s goals. Without authority, managers are
unable to manage, initiate or sustain the management process.
Authority therefore revolves around obtaining the right to perform
certain actions to decide who does what, to discipline those who fail to
do what the organization expects of them. In short, this entails the
right to demand action from employees and the right to take action.
Power
Managers who are strong leaders influence their employees since they
possess power and therefore are able to exercise their authority fully.
Leadership and power go hand in hand. Without power, a manager
would not be able to influence employees sufficiently towards
achieving organizational goals. Leaders have two types of power:
position power and personal power. Top management delegates
position power when their followers bestow it on them.
Effective managers use their power in such a way that they maintain a
healthy balance between their own power and that of employees.
(Adapted from “Management Basics: The How-To Guide for
Managers”, 1th Edition, Oxford University Press, Southern Africa)

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Comprehension questions
1. What should managers do to influence their subordinates to
achieve goals?
2. What is the different between leadership and management?
3. What can managers do the delegating activities?
4. What do managers responsibly do for the obligation?
5. Why are managers unable to manage, initiate or sustain the
management process without authority?
6. Why do managers influence their employees?

II. GRAMMATICAL REVIEW: Verb phrase

A. Review
In linguistics, a verb phrase (VP) is a syntactic unit composed of at
least one verb and its dependents - objects, complements and other
modifiers - but not always including the subject. Thus in the
sentence “A fat man put the jewels quickly in the box”, the words “put
the jewels quickly in the box” are a verb phrase; it consists of the
verb “put” and its dependents, but not the subject “a fat man”. A verb
phrase is similar to what is considered a predicate in more traditional
grammars.
Verb phrases generally are divided among two types: finite and
nonfinite. Phrase structure grammars acknowledge both types, but
dependency grammars treat the subject as just another verbal
dependent, and they do not recognize the finite verbal phrase
constituent. Understanding verb phrase analysis depends upon
knowing which theory obtains in context.
1. Finite verb phrase
Finite verb phrases are the verb phrases of which the head of the
phrases is a finite verb. They can occur as the verb phrase of

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independent clause. They have tense contrast, i.e. distinction between
the present and past tenses. There is person and number concord
between the subject and the finite phrases.
Example:
- She walks home after the work every day.
(Here, it can be seen that the finite verb is walks and the pronoun
“she” is the subject)
- Tom reads the papers every morning.
(Here, it can be seen that the finite verb is reads and the subject is
“Tom”)
2. Non-finite verb phrase
Non-finite verb phrases are the verb phrases, where the head is a
nonfinite verb.
The three types of verbal phrases are participial, gerund, and
infinitive phrases.
 Participial Phrases
Participial Phrases are present participles or past participles and any
modifiers, objects, or complements. Participial phrases contain verbs
which act as adjectives in a sentence.
Examples:
- Singing very softly, the boy lulled his baby brother to sleep. (the
participial phrase works as an adjective, modifying "boy")
- The girls, frightened by the police car's headlights, quickly came
down from the school's roof. (the participial phrase works as an
adjective, modifying "girls")
 Gerund Phrases
Gerund Phrases contain verbs ending in “-ing” and any modifiers,
objects, or complements. Gerund phrases act as nouns in a sentence.

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They can act as the subject or object of a verb, as a predicate
nominative, and as the object of a preposition.
Examples:
- Waiting for his grades drove him crazy. (the gerund phrase works
as the subject of the verb "drove")
- The woman denied knowing her own husband. (the gerund phrase
works as the object of the verb "denied")
- He thought he could escape from his problems by running away.
(the gerund phrase works as the object of the preposition "by")
- Making many acquaintances is cultivating future friendships. (the
gerund phrases work as the subject and as the predicate nominative)
 Infinitive Phrases
Infinitive Phrases contain verbal phrases consisting of "to",
followed by a verb and any modifiers, objects, or complements.
Infinitive phrases usually act as nouns, but they can also act as
adjectives and adverbs.
Examples:
- To live in Boston eventually is his main goal in life. (the infinitive
phrase works as the subject of the sentence)
- Quentin Tarentino loves to babble during interviews. (the infinitive
phrase works as the object of the verb "loves")
- Do you have any clothes to donate to the homeless shelter? (the
infinitive phrase works as an adjective, modifying "clothes")
- She went home to visit her family. (the infinitive phrase works as an
adverb, modifying "went")
B. Drilling exercises
Exercise 1: Specify whether the underlined verbs are finite or
non-finite

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To speak in class (1) is difficult for some children but not for Charlie.
He raises his hand (2) constantly and loves (3) to participate in class
discussions (4). He does his homework (5) and is very well prepared
(6). Prepared students (7) are more successful. And Charlie is doing
well (8) in kindergarten.
Sometimes Charlie talks (9) a little too much. The teacher
reminds him (10) to share the discussion time (10). Other students are
quiet (11) and may think (12) that they don't have anything
important (13) to say (14). But the teacher values all the students'
opinions (15) and helps quiet students (16) stand out (17) more.
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Exercise 2: Specify whether the sentences or phrases below are
finite or non-finite
1. [Everybody left just after the ceremony]. Finite/ Non-finite
2. [Inviting your sister] was not a great decision. Finite/ Non-finite
3. I'll be home around ten [if my train is on time]. Finite/ Non-finite
4. [They expect Susan to do all the work]. Finite/ Non-finite
5. [Deprived of oxygen], plants will quickly die. Finite/ Non-finite
6. [Finding the gates widely open], the thief went inside.
Finite/ Non-finite
7. He had his car [cleaned]. Finite/ Non-finite
8. [He has a big car.] Finite/ Non-finite
9. [She speaks Chinese very well.] Finite/ Non-finite
10. Nancy is [doing her homework at the moment]. Finite/ Non-finite

III. WORD STUDY

Exercise 1: Fill in the blank with a suitable word.

occurs responsibility satisfied environment process opportunity

unsatisfied happens employees managerial employers surface

Employees (the human resources) influence the organization‟s

productivity and profitability directly. In order to manage employees
effectively, managers should understand what motivates the behaviour
of their (1) __________________. This is a crucial aspect of the
leading function.
“Motivation” is defined as “an inner desire to satisfy an
unsatisfied need”. It is an intrinsic process and therefore managers
cannot “motivate” their employees. However, they can create a

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working (2) ________________ where their employees will be
motivated to achieve the organization‟s goals. To use an example
from the case study, managers at Bidvest are motivated to create rapid
growth because the company allows them to take (3) _____________
for the success of their businesses. Thus, from an organizational
perspective, motivation is the willingness of an employee to achieve
the organization‟s goals.
The motivation process starts with an unsatisfied need and moves in a
certain sequence. For example, an employee has an (4) ____________
need for higher status in the organization. Her motive is the desire to
advance to a first-line (5) ________________ position, which leads
to certain behaviour, such as working over-time or enrolling for a
management course. The consequence of the behaviour might be that
she receives a promotion (or does not receive a promotion), which will
lead to the satisfaction (or dissatisfaction) of her need. If
dissatisfaction (6) ________________, the need remains unsatisfied
and the motivation process will start all over again. Satisfaction is
usually short lived because people have many needs, and as soon as
one need is satisfied, another need will (7) ________________.
If the managers understand what motivates the behaviour of their
employees, they can influence the employees‟ work performance. Yet
it is important to note that motivation is not the only factor that
influences work performance. Effective managers understand that
employees must (8) ________________ a high level of motivation
plus the appropriate training, knowledge and skills to perform
effectively in a given work situation. If the employees lack the skills
they need to perform, they will not be able to do their work properly,
no matter how motivated they are. Employees should also have the
opportunity to perform, which means that they must have adequate
resources to be able to do the work.

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Exercise 2: Word formation.
Every group in an organization is different in terms of its structure or
set of characteristics that shapes the behavior of both members, for
example, the size of group, the composition of the group, group norms
and group (1) __________________ (COHESIVE). Group size affects
the group‟s overall performance. If the group is too big, social loafing
occurs. “Social loafing” refers to the (2) _______________ (TEND)
of individuals to put in less effort when working in a group than when
working individually. Thus, group size has an influence on the (3)
___________________ (PRODUCT) of groups.
Group norms are standards shared by members of a group that
develop from (4) ___________________ (INTERACT) between these
members. Norms can be positive or negative, and should be managed
by managers. An example of a positive norm is that the group strives
to outperform other groups; a negative norm is: “We only do what is
asked of us - no more, no less”. There is a strong relationship between
performance norms and cohesiveness, which can be either beneficial
or (5) ___________________ (DETRIMENT) to the organization. If a
group is very cohesive, the members‟ adherence to group norms will
be (6) ___________________ (STRONG).
Status in groups can be formal or informal, meaning that groups
sometimes give higher (informal) status to group members who
relatively low on the (7) ___________________ (HIERARCHISM)
level of the organization. The formal leader in a group usually has a
title such as section or department manager, supervisor, project leader,
task-force head or committee chair.
In order to manage group in an organization effectively, managers
should understand how groups are structured and how the various
characteristics of specific groups influence the organization‟s
performance. Managers should not under-estimate the role of groups
in the overall (8) _____________ (ACCOMPLISH) of organizational
goals. They should understand group dynamics so as to manage the
groups in their organizations effectively.

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Exercise 3: Match the words or word phrases with its definitions.

1. Authority a. The degree to which a group seems attractive

to its members, and perhaps on a side note, the
degree to which a group performs well together
with minimum conflict and maximum conflict
resolution.

2. Delegation b. Has been described as "a process of social

influence in which one person can enlist the aid
and support of others in the accomplishment of
a common task.

3. Employee c. The evaluation of how well individuals meet

their responsibilities

4. Group d. The process of assigning responsibility and

cohesiveness authority or achieving organizational goals.

5. Informal leader e. A person who is hired to work for another or

for a business, firm and so on.

6. Leadership f. The use of influence to motivate employees to

achieve organizational goals.

7. Organization g. Authority and influence bestowed by a

position or office on whoever is filling or
occupying it.

8. Position power h. The ability of a person to influence the

behavior of others by means other than formal
authority conferred by the organization through
its rules and procedures.

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 i. An individual within an organization that is
viewed as someone worth listening to due to
their perceived experience and reputation
among peers.

j. Helps managers be unable to manage, initiate

or sustain the management process

k. The act of organizing a business or an activity

related to a business.

l. A person or institution that hires employees or

workers. He/She offers wages or a salary to the
workers in exchange for the worker's work or
labor.

IV. TRANSLATION
Communication is an essential element of leading. Effective
leadership depends on constant communication between leaders and
their employees. It is very important in building and sustaining
relationships in an organization. Good communication is conducive to
good relations between managers and individual employees, groups,
teams and, ultimately, the organization and its environment. A
considerable proportion of a manager‟s time is devoted to
communicating with the organization‟s stakeholders, both inside and
outside the organization. Furthermore, the management process is
dependent on effective communication.
Theoretically, communication is the transfer of information or
messages from one person to another. A simple communication model
is a process, which provides a basis for understanding the key
elements of interpersonal communication: sender → massage →
channel → receiver.

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The sender is the source of a message. To communicate effectively,
the sender should know exactly what the message is that he/she
wishes to transmit. The sender should take care with his/her choice
of words and their meaning, and should encourage two-way
communication by showing insight into the receiver‟s perceptions.
The message may convey ideas, opinions, plans, orders or
explanations. In the interests of effective communication, the
message should be simple and clear. The communications channel is
the manner in which the message reaches the receiver. It may assume
any form that can be perceived by any of the recipient‟s senses, as
long as it is comprehensible. The receiver of the message should
absorb the message and show that he/she has received and
understood the message.

V. DISCUSSION PROMPTS
Defining a Leader
1. What does it mean, to you, to be a leader?
2. What does being an “effective” or “successful” leader mean to you?
3. What defines a person of character?
4. What does being a leader of character mean to you?
5. Think of someone you admire, a role model. What qualities do you
admire about this person(s)?
6. How can you develop these qualities?
Discuss in groups these questions above. Give your own opinion.

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