Behavioral Economics
Behavioral Economics
Cicero Seisdedos
PB535 – Business and Financial Literacy
Professor: Dr. Nancy Wood, PhD
December 09, 2012
Introduction Behavioral Economics is an extremely important field of psychology; it seeks to expand the current tools that researchers use in economics and finance to introduce new models of human behavior that are adequately founded in psychological research. The Behavior Economics is crucial in business decision making process. The knowledge in Business and Financial Literacy is very important for their direct application to Business and Consulting Psychology. Understanding Financial Management which includes: profit & loss, cash flow, balance sheets, ratios, ROI, working capital, budgeting, financial planning, and corporate finance; and Business Management that includes: business strategy, strategic market management, micro-economic analysis, sustainable competitive advantage, strategic positioning, diversification, acquisitions, mergers, and technology management, will allow the consultant to help businesses increase their profits and improve their company’s culture.
Business Management and Strategy Business Strategy is a management plan of action that an organization put in place in order to achieve a particular goal or a set of goals and objectives, this strategy can help the organization differentiate itself from its competitors. In order for a company to differentiate itself from their competitors, they need to successfully implement a strategy that will determine the market that the business will compete, the investment needed, the strategies required to compete in that specific market and the strategic resources or competencies that underline the strategy by providing a important sustainable competitive advantage (SCA) (Aaker, 2001).
Budgeting and Financial Planning There are many vital managerial tools that assist in managing a successful business. Budgeting is the most common and widely used tool for
Cicero Seisdedos
PB535 – Business and Financial Literacy
Professor: Dr. Nancy Wood, PhD
December 09, 2012
Introduction Behavioral Economics is an extremely important field of psychology; it seeks to expand the current tools that researchers use in economics and finance to introduce new models of human behavior that are adequately founded in psychological research. The Behavior Economics is crucial in business decision making process. The knowledge in Business and Financial Literacy is very important for their direct application to Business and Consulting Psychology. Understanding Financial Management which includes: profit & loss, cash flow, balance sheets, ratios, ROI, working capital, budgeting, financial planning, and corporate finance; and Business Management that includes: business strategy, strategic market management, micro-economic analysis, sustainable competitive advantage, strategic positioning, diversification, acquisitions, mergers, and technology management, will allow the consultant to help businesses increase their profits and improve their company’s culture.
Business Management and Strategy Business Strategy is a management plan of action that an organization put in place in order to achieve a particular goal or a set of goals and objectives, this strategy can help the organization differentiate itself from its competitors. In order for a company to differentiate itself from their competitors, they need to successfully implement a strategy that will determine the market that the business will compete, the investment needed, the strategies required to compete in that specific market and the strategic resources or competencies that underline the strategy by providing a important sustainable competitive advantage (SCA) (Aaker, 2001).
Budgeting and Financial Planning There are many vital managerial tools that assist in managing a successful business. Budgeting is the most common and widely used tool for
References: Aaker, D. (2001). Developing business strategies (6th Ed.). New York, NY: John Wiley and Sons, Inc. Berman, K. & Knight, J. (2008). Financial Intelligence For HR Professionals. Boston, MA: Harvard Business Press. Fernandez-Huerga, E. (Sep2008). The economic behavior of human beings: The institutional/post-Keynesian model. Journal of Economic Issues (Association for Evolutionary Economics, 42 (3), 709-726. Gitman, L. J. (2009). Principles of managerial finance. (12 ed.). Boston, MA: Addison-Wesley. Goodman, G. F. (2012). Engagement marketing: How small business wins in a socially connected world. Hoboken, NJ: John Wiley & Sons. Holden , P. (2010). Economies of scale: a quick explanation [Video file]. Retrieved from YouTube website: http://www.youtube.com/watch?v=AZshS761WsE Marks, M Marks, M., & Mirvis, P. H. (2012). Applying OD to Make Mergers and Acquisitions Work. OD Practitioner, 44(3), 5-12. Shook, L., & Roth, G. (2010). Downsizings, mergers, and acquisition: Perspectives of human resources development practitioners. Journal of European Industrial Training 32(2), 135-153. Spiegel, M. (2000). Principles of corporate finance. Unpublished raw data, Yale School of Management, Retrieved from http://som.yale.edu/~spiegel/intro/sampread.pdf Teamtechnology.co.uk Wickramasignhe, V. & Karunaratne, C. (Mar2009). People management in mergers and acquisitions in Sri Lanka: employee perception. Journal of Human Resource Management, 20 (3), 694-715. Wood, N. (2012). Behavioral Economics. [PowerPoint slides]. Retrieved from http://www.nancywood.org/Business/Behavior/Behavioral.pptx