Strategic management

INDEX

1

SR.NO PARTICULARS PG.NO

1. EXECUTIVE SUMMARY 2

2. CORPORATE SOCIAL RESPONSIBILITY Introduction Definition

3 4

3 AMWAY Introduction Meaning and history Mission and vision

5610

4 IMPORTANCE OF COMMUNICATION FOR

AMWAY

AWARD AND RECOGNITION

18

20

5 SOCIAL RESPONSIBILITIES PERFORMED BY AMWAY 21

6 FUNCTIONAL PATTERN 33

7 SWOT ANALYSIS 39

8 CONCLUION 43

9 BIBLIOGRAPHY 44

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Executive Summary

Corporate social responsibility (CSR, also called corporate conscience, corporate

citizenship or responsible business) is a form of corporate self-regulation integrated into

a business model. CSR policy functions as a self-regulatory mechanism whereby a business

monitors and ensures its active compliance with the spirit of the law, ethical standards and

national or international norms. With some models, a firm's implementation of CSR goes beyond

compliance and engages in "actions that appear to further some social good, beyond the interests

of the firm and that which is required by law.

This executive summary will give you key facts concerning the Amway. These factswill help

to find out how well the Amway opportunity can match your business goals. Let’sstart from

main component that is business. A business' purpose is to attract and keepcustomers. Its one

basic function is to reliably solve customer problems.

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Introduction of CSR

Corporate social responsibility (CSR, also called corporate conscience, corporate

citizenship or responsible business) is a form of corporate self-regulation integrated into

a business model. CSR policy functions as a self-regulatory mechanism whereby a business

monitors and ensures its active compliance with the spirit of the law, ethical standards and

national or international norms. With some models, a firm's implementation of CSR goes beyond

compliance and engages in "actions that appear to further some social good, beyond the interests

of the firm and that which is required by law.

The aim is to increase long-term profits through positive public relations, high ethical standards

to reduce business and legal risk, and shareholder trust by taking responsibility for corporate

actions. CSR strategies encourage the company to make a positive impact on the environment

and stakeholders including consumers, employees, investors, communities, and others.

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DEFINITION OF CSR

The term "corporate social responsibility" became popular in the 1960s and has remained a term

used indiscriminately by many to cover legal and moral responsibility more narrowly construed.

Business Dictionary defines CSR as "A company’s sense of responsibility towards the

community and environment (both ecological and social) in which it operates. Companies

express this citizenship

(1) through their waste and pollution reduction processes,

(2) by contributing educational and social programs and

(3) by earning adequate returns on the employed resources.

A broader definition expands from a focus on stakeholders to

include philanthropy and volunteering.

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INTRODUCTION OF AMWAY

Amway is the largest direct selling company and manufacturer in the world that uses

network marketing to sell a variety of products, primarily in the health, beauty, and home care

markets. Amway was founded in 1959 by Jay Van Andel and Richard DeVos. Based in Ada,

Michigan, the company and family of companies under Alticor reported sales growth of 2.3%,

reaching US$8.4 billion for the year ending December 31, 2009.Its product lines include home

care products, personal care products, jewelry, electronics, Nutrilite dietary supplements, water

purifiers, air purifiers, insurance and cosmetics. In 2004, Health & Beauty products accounted

for nearly 60% of worldwide sales. Amway conducts business through a number of affiliated

companies in more than ninety countries and territories around the world. It is ranked by Forbes

as one of the largest private companies in the United States and by Deloitte as one of the largest

retailers in the world.

MEANING AND HISTORY OF AMWAY:

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What does the word Amway mean? Amway is an abbreviation for "American Way".

Great companies start with great ideas, and Amway is no exception. The idea came when two

Nutralite® salesmen, Rich DeVos and Jay Van Andel were at the very top of a very successful

MLM at the time; Nutralite was sold door to door. This was the 1950s, Nutralite was a single

entity company, and by the end of the decade, Jay and Rich had built a respectable business of

their own - approximately five thousand distributors were in their Both Mr. DeVos and Mr. Van

Andel knew how to move product - build on relationships. But what was needed was a way to

expand. A way that would allow them to multiply the efforts of what they alone could

accomplish. In 1959, the American Way Association was formed. This would be the chance to

grow and set the direction of a new entity. Rich and Jay immediately set out to find an initial

product to add to the line. They purchased the rights to Frisk, a household cleaner (which was

later renamed Liquid Organic Concentrate or L.O.C.).

In 1960, the American Way Association, now Amway, bought a controlling share in the

manufacturing facility in Michigan where LOC was made. What this meant is that there were 3

companies all using the Amway name. The Amway Sales handled product and distribution,

Amway Services did business related tasks (like insurance for distributors) and Amway

manufacturing, which produced LOC. By 1964, the three arms of Amway were all merged into a

single entity - Amway Corporation. The idea was by handling the manufacturing and distribution

of a product line, and then allowing a network of IBOs. This seemed like the only way to offer

what Jay and Rich originally envisioned - a solid opportunity where anyone with motivation

could excel, regardless of their background and status. This is a main part of Amway's business

philosophy. Not just products and not just sales, but a way to a better life.

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Amway continued to grow under the co-ownership of Van Andel and Devos. In 1972, the

pair purchased Nutralite outright - they now owned the company they had started as employees

with.

Amway continued to expand, reaching past the borders of the US to offer the same

opportunities in other countries:

- Australia - 1971

- Europe and parts of Asia - 1974

- Japan - 1979

- Latin America - 1985

- China - 1995

- Africa - 1997

- India - 1998

- Russia - 2005

- Vietnam -- 2008

Critics argued that the model wasn't sustainable and that growth was mathematically

limited. They cried, "Pyramid scheme!" Fifty years of steady growth has shown this criticism has

no basis in fact.

In 2008, Amway (now technically, Amway Global) reported sales of 8 billion. The

company is in 58 markets worldwide and manufactures more than 450 products. Amway Global

does business in more than 98 countries.

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Rich DeVos is still alive, although he has passed the Presidency of Amway to his son

Dick. DeVos was named one of the richest men in America by Forbes magazine, with an

estimated 4.2 billion dollars in personal wealth (2009). DeVos owns the Orlando Magic

basketball team among other assets.Jay Van Andel passed away at age 80 in 2004. Mr. Andel's

place at Amway Global is now held by his son Steve. At his death, Van Andel's net worth was

estimated to be 2.4 billion dollars.

The company is still thriving and still offers opportunity to individuals who have the desire to

build their own business. MLM is a proven business model that produces massive success for

individuals.

Global markets

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According to the Amway website, as of 2011 the company operates in over 100 countries and

territories, organized into regional markets: the Americas, Europe, greater China, Japan and

Korea, and SE Asia/Australia.

In 2008, Alticor announced that two-thirds of the company's 58 markets reported sales increases,

including strong growth in the China, Russia, Ukraine and India markets.

Direct selling

In direct selling, the sale is the culmination of many activities which involve matching

customer requirements to the goods or services offered.

The main benefit of this form of selling is that it allows distributors to focus on individual

customers and their needs.

Company Vision:

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Corporate vision is a short, succinct, and inspiring statement of what the organization

intends to become and to achieve at some point in the future, often stated in competitive terms.

Vision refers to the category of intentions that are broad, all-inclusive and forward-thinking.  It is

the image that a business must have of its goals before it sets out to reach them. It describes

aspirations for the future, without specifying the means that will be used to achieve those desired

ends.

Warren Bennis, a noted writer on leadership, says: "To choose a direction, an executive

must have developed a mental image of the possible and desirable future state of the

organization. This image, which we call a vision, may be as vague as a dream or as precise as a

goal or a mission statement."

Core values include:

Safety – Safety serves as a barometer of our company’s overall success and is a specific measure

of our operating excellence.

Trust – Trust is the mutual respect for and confidence in people. Trust recognizes the

importance of individuals and appreciates their diverse opinions. Trust compels us to share

information and encourage new ideas. It requires an open, honest, forthright manner.

Confidence – Self-confident people take initiative, handle the unexpected, stand behind their

convictions and support the efforts of others. They take bold, innovative, creative actions,

capitalize on opportunities, make sound decisions quickly, and mobilize the best resources for

rapid action.

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Teamwork – Teamwork is personal involvement and collaboration in a team environment. It

includes setting a common goal in support of business objectives, making an individual

commitment to the team’s success and recognizing the success of the team.

Accountability – Being accountable means every employee assumes ownership and

responsibility for his or her own work, regardless of the job they perform. Being accountable

means making decisions and holding oneself responsible for the consequences of those choices.

Doing What’s Right – Doing what’s right is being honest, ethical, and having personal and

professional integrity. It means consistently treating all people fairly, delivering on promises, and

taking personal responsibility for your actions.

Quality – Quality is the primary determinant of customer satisfaction and loyalty, and it requires

employees to continuously provide internal and external customers with the right product or

service...done right...the first time. In today’s increasingly competitive business environment,

better quality translates into better value for our customers and, subsequently, better value for

their customers-and this is the very essence of competitive differentiation.

Mission:

Most businesses have some form of mission statement ,whether they know it or not. For

example, other names for a mission include: founder's philosophy, statement of purpose,

business philosophy. An organization's mission describes its fundemental purpose and overall

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philosophy. A mission statement (what we are) is different than a vision statement (what we

want to become).

Mission statement:

Provides thrust and direction to the organization.

Cornerstone of all strategic planning.

A mission statement is an organization's vision translated into written form. It makes

concrete the leader's view of the direction and purpose of the organization. For many corporate

leaders it is a vital element in any attempt to motivate employees and to give them a sense of

priorities.

A mission statement should be a short and concise statement of goals and priorities. In

turn, goals are specific objectives that relate to specific time periods and are stated in terms of

facts. The primary goal of any business is to increase stakeholder value. The most important

stakeholders are shareholders who own the business, employees who work for the business and

clients or customers who purchase products and/or services from the business.

The mission statement should be a clear and succinct representation of the enterprise’s purpose

for existence. It should incorporate socially meaningful and measurable criteria addressing

concepts such as the moral/ethical position of the enterprise, public image, the target market,

products/services, the geographic domain and expectations of growth and profitability.

The intent of the Mission Statement should be the first consideration for any employee

who is evaluating a strategic decision. The statement can range from a very simple to a very

complex set of ideas.

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Product lines of Amway

It includes:

home care products,

personal care products,

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jewelry,

electronics,

Nurtilite dietary supplements,

water purifiers,

air purifiers,

artistry,

insurance and cosmetics.

Business model

Amway combines direct selling with a multi-level marketing strategy. "Independent Business

Owners" (IBOs) may market products directly to potential customers and may also sponsor and

mentor other people to become IBOs. IBOs may earn income both from the retail markup on any

products they sell personally, plus a performance bonus based on the sales volume they and their

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downline (IBOs they have sponsored) have generated.[3] People may also register as IBOs to buy

products at discounted prices.

Alticor and Amway Sales Growth: 1960 to 2008:

February 5th, 2009 by ibofightback Posted in Amway News

Amway global sales were reported at “estimated retail” until 2000 when the holding

company of Alticor was formed. This means they’re valued assuming that they were all sold at

the full retail price, not at the price they were sold to distributors/IBOs. Alticor reports actual

revenue – sales at the base IBO price

I’ve converted the figures so they can be properly compared. It’s important to be aware of

this as many critics of the business (including some former Diamonds who you would think

know about this) have in the past conveniently ignored the change in reporting standards and

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tried to claim Amway’s sales peaked in 1998. Note however that Alticor sales includes revenues

from other sources such Access Business Group and Amway Grand Plaza. In 2007 this was

reported as around $100 million, so by far the majority of the sales are through the Amway

business opportunity.

Amway Sales Data:

Yea

r

Estimated Retail

Sales

Yea

r

Estimated Retail

Sales

Yea

r

Estimated Retail

Sales

Yea

r

Estimated Retail

Sales

1960 $0.5 million 1970 $120 million 1980 $1.1 billion 1990 $2.2 billion

1961  ? 1971 $165 million 1981 $1.4 billion 1991 $3.0 billion

1962  ? 1972 $180 million 1982 $1.5 billion 1992 $3.9 billion

1963 $21 million 1973 $210 million 1983 $1.13 billion 1993 $4.5 billion

1964 $25 million 1974 $230 million 1984 $1.2 billion 1994 $5.3 billion

1965 $38 million 1975 $250 million 1985 $1.2 billion 1995 $6.3 billion

1966 $40 million 1976 $300 million 1986 $1.3 billion 1996 $6.8 billion

1967 $50 million 1977 $375 million 1987 $1.5 billion 1997 $7.0 billion

1968 $65 million 1978 $500 million 1988 $1.8 billion 1998 $5.7 billion

1969 $85 million 1979 $800 million 1989 $1.9 billion 1999 $5.0 billion

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Amway has grown fairly quickly since its inception. Its historic sales data at estimated

retail prices is provided below from 1959 to 2000 (in 2000 Amway switch over to Alticor. At its

peak in 1997 Amway estimated retail sales worldwide at 7 Billion USD. With the founding of

Alticor, the report methodology was changed and the actual sales to distributors instead of

estimated retail sales (ERS) have been reported since 2001. Taking the sales data published in

2001 report into account, the ERS values are about 32% higher than sales to distributors. The

actual sales to distributors are marked with *.

Until 1999 sales were reported at Estimated Retail. This is approximately 32% higher than actual

sales revenues from sales made to Amway distributors.

Importance of Communication for Amway

Communication is the activity of conveying information through the exchange of

thoughts, messages, or information, as by speech, visuals, signals, writing, or behavior.

Amway need to communicate 35000 distributers

To achieve the intended result

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Inefficient and wasteful to send a message to every distributer

Specific:

The Mission Statement should represent the broadest perspective of the enterprise's

mission. You may want to take the approach of being very specific. For instance, a Mission

Statement for a fictitious airline could be worded as follows: Your mission statement is an

opportunity to define your business at the most basic level. It should tell your company story and

ideals in less than 30 seconds: who your company is, what you do, what you stand for, and why

you do it. Do you want to make a profit, or is it enough to just make a living? What markets are

you serving, and what benefits do you offer them? Do you solve a problem for your customers?

What kind of internal work environment do you want for your employees? All of these issues

may be addressed in a mission statement.

Other ways to think about a mission statement as you begin to write one include:

Answers the question, “What business are we in?”

Provides thrust and direction to the organization.

Must be market-oriented (focusing on the problem the business is solving),

not product-oriented.

Basic guidelines in mission:

Your mission statement is about you, your company, and your ideals.

Don’t “box” yourself in.

Keep it short.

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Ask for input.

Goals:

The major outcome of strategic road-mapping and strategic planning, after gathering all

necessary information, is the setting of goals for the organization based on its vision and

mission statement. A goal is a long-range aim for a specific period. It must be specific and and

realistic. Long-range goals set through strategic planning are translated into activities that will

ensure reaching the goal through operational planning.

Some company Goals may be as follows:

To promote a profitable and sustainable business activity that meets the customers’

needs.

To increase the company's market share.

To gain the competitive edge.

To increase the company's role in relations to social responsibility.

To provide excellent customer service.

Awards and Recognition:

Presented the Millennium Outstanding Service Award 2000, by the Confederation for

the Blind (AICB), in recognition for work carried out for the visually challenged.

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The Indian Red Cross Society, Orissa awarded AOF a memento & certificate for

conducting a mega-Blood Donation camp of 816 units on 4th May, 2003.

 

The Surat Raktdaan Kendra felicitated Amway India at their annual function on 5th

Oct, 2003, for the largest number of donors at a Blood Donation Camp (BDC) held by

any financial and commercial institution and industry. The Mayor of Surat - Snehlata

Chouhan - presented a trophy and a certificate of appreciation.

 

Social responsibilities performed by AMWAY:

One by One Campaign for Children

Amway Opportunity Foundation (AOF)

National Project for the Blind:

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Project Sunrise : The objective is to identify one orphanage/institution at each location

where Amway has a modestly-large office (52 cities). On-going assistance to be provided

in education, healthcare and vocational training under the following heads:

· Health care

· Education and vocational training

· Safe drinking water

· Children’s Day and AOF Day celebration with Amway staff & Amway

Amway Products:

Amway offers a range of exclusive, competitive brands that meet proven customer needs

around the world. From nutritional supplements to water treatment, cosmetics to cleaning

products, these brands are the solid foundation for a successful, independent Retail business.

Active Lifestyle • Artistry • Atmosphere • Beautycycle • Body Series • Boutique • Dish Drops •

Eddie Funkhouser • Emma Page • eSpring • L.O.C. • Gensona • Glister • Hymm • iCook •

LifeStyle Balanced Solutions • NAO Cosmetics • Moiskin Skin Care • Nutrilite • Nutriway • XS

Energy • Ocean Essentials • Personalized Health • Peter Island • Protique • Positrim • Satinique •

SA8 • Time Defiance • Tolsom • Trim

Amway Personal Care Products

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Nutrilite® is the world’s leading brand of vitamin, mineral, and dietary supplements,

grown harvested and processed on its own certified organic farms.

Artistry® is one of the world’s top five largest-selling prestige brands of facial skin care

and colour cosmetics. Our scientists and formulators have developed the complete line of

cosmetics,

All products of Attitude contain Skin Vitalising Complex that synergistically combine to

cleanse, Replenish & Moisturise the skin making it soft & supple.

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Dynamite's range of male grooming products, formulated internationally is designed to

deliver the ultimate grooming experience.

Glister Toothpaste is a revolutionary Multi-Action Toothpaste with Sylodent that offers

seven benefits.

Persona Premium 3 in 1 Soap is a complete soap for the entire family promises refreshing

confidence.

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Satinique Advanced Range with unique Ceramide Infusion System uses nature's own

renewing technology to rejuvenate, strengthen and protect your hair.

SA8 Gelzyme is India's only 3-in-1 laundry detergent which pretreats, cleans and softens.

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G&H Range enriched with the goodness of Glycerine and Honey, deeply nourishes and

hydrates the skin for a healthy glow.

LOC High Suds is a multipurpose household liquid cleaner.

Dish Drops is a concentrated hand dishwashing liquid with a powerful "Triadic

Detergency System".

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Great Value Product Range offers you Great Quality, Great Performance, Great Price and a

Money Back Guarantee.

Amway’s competitors:

1) Direct competitors:

AVON

MARY KAY

SUNRIDER

2) Indirect competitors:

Local INDIAN companies.

Changing Political & Economic Atmosphere

Products used as samples to persuade relatives and friends to join Amway

Focus shifted from selling products to recruiting.

Organizational structure of Amway:

Terms used in Amway:

IBO/ABO/AIE-Independent Business Owner/Amway Business Owner/Amway

Independent Entrepreneur is a business partner of Amway who is authorized to market

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and distribute products and services available from Amway. Different names are used in

different markets.

Distributor - an older term for IBO

PV — Point Value is a value assigned to each product or service sold by Amway. An

IBOs monthly performance bonus bracket depends on total PV in a month.

BV — Business Volume is typically the wholesale cost of the product or service sold by

Amway. Performance bonuses are multiplied by the groups total BV.

Performance bonus is the monthly bonus paid by Amway to IBO's. The higher the PV,

the greater the percentage earned. In North America the Performance bonus ranges from

3% to 25%. In other markets it ranges from 3% to 21%. In India it ranges from 6%-21%.

Retail Profit is the markup earned by an IBO when they sell a product to a consumer,

either personally or through an Amway website. Recommended retail markup ranges

from 20%-35%.

Sponsor is an IBO who refers (sponsors) a new IBO to Amway, although IBO's do not

get paid to sponsor.

Upline is the term used to refer all the IBOs up in the line of sponsorship of an IBO.

Downline is the term used to refer all the IBOs down in the line of sponsorship of an

IBO. They are collectively also known as group

Leg refers to a personally sponsored IBO and all of their downline.

Silver Producer is an IBO who has reached the maximum bonus level for one month.

Gold Producer is an IBO who has reached the maximum bonus level for three months.

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Platinum or direct is an IBO who has reached the maximum bonus level for six months.

In North America a Platinum is generating a minimum of approximately $30,000 in sales

volume per month.

Emerald a distributor with at least three legs generating Silver Producer volume for at

least 6 months of a year.

Diamond a distributor with at least six legs generating Silver Producer volume for at

least 6 months of a year.

Q-12 is a Platinum or higher IBO that qualifies every month for 12 months of a year.

Marketing strategy:

A strategy is a plan of action designed to achieve the goals of the organisation. In

creating a marketing strategy for the Super Concentrated Cleaning System, Amway needed to set

out the key objectives it wanted to achieve. The following objectives for the brand were set:

To increase distribute or profitability and productivity by providing a new and exciting

business opportunity

To optimize consumer convenience and value through enhanced product differentiation

with this exclusive and revolutionary cleaning system

To provide innovative and unique products to enhance the image of Amway Home Care.

A New Strategy of Amway:

Agreement with the government and company

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resumed operations

Goods will be sold in retail outlets and through

sales representatives

Income of sales distributors will be based on direct selling done by them

Same Distribution centers served as retail outlets for the company

Localization of employees

Localization of production and Raw Material

Localization of research and development

Transparency and Credibility of company’s management

Amway Global provides you with support like:

Customer care: If you have a question about anything - like registration, renewal,

Business, or product information - our Customer Care Associates can help you.

Business management: You can manage your business, check customer Volume, order

products, and renew your business, all at Amway Global.com.

Order management: You sell the products, and we'll do the rest, like process the order,

manages your customer accounts, and handles the shipping details.

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Training: Online, video, and instructor-led training are some of the ways we can share

with you the knowledge to grow a successful independent business.

Marketing: We support your sales efforts with DVDs, online sites, Magazines,

brochures, and free websites you can personalize. And we help Build awareness of your

products and brands with national advertising, promotions, and event sponsorship.

 Amway believe that quality improvement happens when people come together. This core

belief is what all AOF initiatives are based upon and it holds true time and again. With a

passionate and vigorous workforce ready to contribute their bit to the well-being of society,

volunteering becomes a way of life in Amway. The 550,000 Amway distributors and 450 full-

time employees are all considered AOF volunteers. At 56 Amway offices across India, AOF has

formed a team of 6 or more distributors and employees to form a Local Implementation

Committee (LIC). LIC takes ownership of being the face of Amway’s CSR at the location. They

identify potential partners, form a project, and implement this with other volunteers. The LIC

also plays a lead role in raising funds they wish to utilize. The beauty of this system is that the

LIC raises the funds, and then decides how best to utilize this in their town or city.

Strategic analysis to overcome problems:

Today it is a global business that, along with its parent and sister companies, directly

employs 10,000 people worldwide. The business also operates strategically at a Global,

European and National level. Amway (UK) began operations in 1973 and has its own

distribution and Product Selection Centers.

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Amway has helped millions of people around the world to start their own independent

business, through which they engage in person-to-person marketing. This type of direct selling

involves matching a consumer's needs with the goods and services on offer. The better the

match, the more lasting the relationship between the seller and the buyer.

Ownership of Amway:

IBOs and Customers:

Amway services the needs of both Independent Business Owners and customers. IBOs

build businesses that allow them to earn income based on sales made resulting from their efforts.

To launch an Amway-powered business, individuals must register with an existing IBO.

Customers pay no fee to shop from a large selection of products and learn from expert advice on

health, beauty, home care, and other topics. Products are shipped to their homes and covered by

Amway's Customer Satisfaction Guarantee. Customers must register with the identification

number of their servicing IBO. If a new registrant Does not have a servicing IBO, Amway will

assign them one.

Personal Referrals:

Unlike most other companies, Amway's sales are not the result of advertising. The biggest chunk

of Amway's marketing budget goes directly to rewarding IBOs for sales volume resulting from

their efforts. Those efforts include registration of new Ibos, Members, and Clients, resulting in

product sales. Amway's tiered compensation plan rewards the movement of product through an

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IBO's sales organization and their ability to train others to create their own successful

organizations. When people visit Amway's site, it is the result of a personal referral by an IBO -

not as a result of some advertisement they saw on TV. Personal referrals have proven to be much

more effective. Only 8% of respondents in the Edelman 2005Annual Trust Barometer study

indicated that information obtained in advertising was credible, while 42% trusted information

obtained from family, friends, and colleagues.

Functional Pattern:

Following are the main departments in any organization:

1. Finance and accounts

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2. Marketing and Sales

3. Human resource and administration

4. Technical / Operations

Other departments depend on the size of the organization, like

1. Logistics

2. Procurement

3. Treasury department- sub dept of finance and accounts

1. Finance

The definition of finance is the provision of funds or loan supplied to an individual or

company. Often this term is used for the study of economics and how money is controlled. It can

be also defined as the management of funds and capital required by a business and private

activities. Management of finance has also developed into a specialized branch within the

financial sector and is carried out by finance managers.

Managing this involves dealing with the optimization and allocation of funds to various

areas either by borrowing or by using those available from internal resources. The word

Optimizing may sound strange but it refers to taking measures that minimize the cost of

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financing while simultaneously attempting to maximize the profits out of the employed finance.

Bad debts are poor finance management where rules have not been followed; the result of this is

depressed markets, low production and a cash crisis. It is for this very reason that finance

managers are very careful with finance they agree too and where it is funded from.

It is not uncommon to hear finance managers referred to as bean counters as they are

looking at immediate returns and initial costs against the potential at a later stage. Finance

managers are the pessimists whereas sales managers are the optimists who look to the future and

not to the past! Often though, problems occur with small businesses who fail to see the

distinction between a business loan and a personal one.

Finance department goal and services:

The main goal of The Department is to provide the internal and external users of financial

statements with relevant, accurate and timely information and to guarantee that the required

financial revision is closely adhered to in order to protect the assets of the company. The

Department takes care of finance flow to ensure that the company operates within its financial

regulations and satisfies various external financial requirements. It also ensures that the

corporate, financial records comply with internal and external audit. If to look through the

activity of The Department, there can be picked out the following main services it renders:

Payment of invoices and expenses

Income collection and salary management

Production and assignment of budgets, capital plans, and cash flow forecasts

Monitoring and managing financial plans

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Auditing and reporting financial condition

2. Marketing:

Marketing means informing your potential clients about your products or service, and

finding ways to establish and keep a customer base. Your target market is the specific group of

people that consume your product or utilize your service. Advertising refers to the various media

used to convey your message. Printed advertisement, radio air time, television commercials and

the Internet are all part of advertising that conveys your business message to the public.

Promotion refers to the various methods by which you convey your message to customers. When

you communicate with the public, you're promoting your business. Many people will join

business associations, or set up displays in malls and craft shows for promotional purposes.

Marketing department tasks:

The Marketing office works to raise the awareness of the company and its prominence in the

industry and market. The global aim of the department is promoting the product/service and

increasing recognition of the company through researches and branding efforts. The department's

strengths should all be in proper understanding of consumer behavior and efficient decision-

making process. Typically, the major tasks of the marketing department are as follows:

* Advertising & Communication

* Direct marketing

* Conducting researches and market management

* Service Marketing

* Maintaining image and brand management

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Strategic management

* Developing new product

* Promoting and professional sales

* Retail management & technology.

3. Human resource:

Human resources is a term used to describe the individuals who comprise the workforce

of an organization, although it is also applied in labor economics to, for example, business

sectors or even whole nations. Human resources is also the name of the function within an

organization charged with the overall responsibility for implementing strategies and policies

relating to the management of individuals (i.e. the human resources).

This function title is often abbreviated to the initials 'HR'. The origins of the function arose in

organizations that introduced 'welfare management' practices and also in those that adopted the

principles of 'scientific management'. From these terms emerged a largely administrative

management activity, co-coordinating a range of worker related processes and becoming known,

in time as the 'personnel function'. Human resources progressively became the more usual name

for this function, in the first instance in the United States as well as multinational corporations,

reflecting the adoption of a more quantitative as well as strategic approach to workforce

management, demanded by corporate management and the greater competitiveness for limited

and highly skilled workers. The general purpose of Human Resource department is to establish

proper staffing policy and implement it on practice.

The main goals and tasks of HR department are:

* organize appropriate system of staff selection and recruitment

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Strategic management

* organize system of effective staff training and development

* ensure the competitiveness of the company within labor market

* establish transparent system of staff assessment and promotion

4. Entrepreneurship:

“Entrepreneurship is the act of being an entrepreneur, which is a French word meaning "one

who undertakes an endeavor". Entrepreneurs assemble resources including innovations, finance

and business acumen in an effort to transform innovations into economic goods.”As an

experienced entrepreneur, you are most likely aware that there are daily duties involved with

ensuring your business is successful. Accounting: Includes budgets, payroll, financial planning,

bill payments, and credit management.

Administration: Includes sorting and/or reading mail and email, filing, answering inquiries,

invoicing, bookkeeping, and purchasing.

Computer: Includes such things as keeping your website up to date, virus scanning, contact

management, data entry, upgrading software and learning new software.

Correspondence: Includes writing advertisements, letters, press releases and articles.

Human Resources: Including interviewing, hiring, firing, training, motivating and conflict-

resolution.

Sales: Includes marketing, finding customers, client retention, promotions, advertising and

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special events.

SWOT analysis of Amway:

STRENGTH:

Based on direct selling operations. Hence it can be A home based business. Every can

participate in business. It’s easy to get admission in Amway with easy rout like intent.

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Strategic management

Training to staff.

Functions are performed by IBOs.

Organize meetings and events time to time.

Have good customer service system.

Backed by a 100% Customer Product Refund Policy produce faith and reselling attitude

in customers.

Quality Products that Inspire Confidence. Almost no risk of money as world class quality

Minimal start up costs gives strong base to the initiation of business. So everyone can

participate in business. The person who wants do something can be make profit with

investment of low cost.

Products are easy to sell.

A business with national and international scope gives more opportunity to the

costumers.

The possibility of financial security and freedom of time to enjoy life.

WEAKNESS:

More power to IBOs gives critical structure to organization.

Initially high entry cost leads to somewhat restrictions for business development.

Rumors for direct selling operations.

Focus shifted from selling products to recruiting.

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Strategic management

OPPURTUNITIES:

Setup a manufacturing plant in all countries leads to better platform for company.

Population of INDIA gives better opportunity to company to receive more profit.

As the company name itself gives reliance and faith for the customer and buyer produce

greater opportunity for marketing which leads to decrease in total expenditure of

company.

THREATS :

Too much freedom to IBOs.

Change in government policy may affect to the profit and freedom of company.

Competitors like AVON, MARY KAY; SUNRIDER creates lot of competition in market

which leads to strong marketing competition in market.

Amway India plans 170 new branches by 2013

Eyes 25% y-o-y growth for the next five years.

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Strategic management

Amway India Enterprises Pvt Ltd, a major direct selling FMCG Company in the country, is

planning to open 170 new branches across the country in the next three years (by the year 2013).

The company is also eyeing 25 per cent year-on-year growth for the next five years.

Presently, the company has 130 branches across the country. The company offers 115 products

in five categories- Personal care, Home care, Nutrition & Wellness, Cosmetics and Great Value

products. Nutrition & Wellness segment contributes around 50 per cent of Amway India’s total

turnover.

"With an aim to strengthen our network base, we are planning to increase the number of

touch points (branches) up to 300, by adding 170 new branches across the country in the next

two-three years. We are also planning to launch 6 to 8 new products every year," William S.

Pinckney, MD & CEO, Amway India, said at a press conference during plant visit of reporters to

its Baddi facility in Himachal Pradesh.

With an aim to meet the market demand, the company has just tripled the capacity at its

contract manufacturing facility in Baddi (Himachal Pradesh) at an investment of Rs. 55 crore.

"Amway’s focus in the past 2-3 years was to improve consumer access and awareness,

which paid off handsomely. We have grown from Rs. 799 crore in 2007 to Rs. 1407 in 2009

crore over the past three years, essentially as the quality of the Amway pick-up centre’s has

undergone a sea change, and are more experiential for the consumers. We are eyeing 25 per cent

year-on-year growth for the next five years," Pinckney said.

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Strategic management

CONCLUSION:

Amway is which is one of the largest direct selling company in the world. The main

objectives of Amway are to profit there distributers by eliminating the middlemen and provide

the products to the distributers in cheaper price.

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Strategic management

The products of Amway are world class product quality. They are made up of natural a

thing that’s why they are good for health and environment. Amway covers a wide range of

products from beauty care. Health care, to clothing, and daily use products etc. the products are

costly as compared to other branded products available in market but if we compare the quantity

while using the products require less amount and thus can be used for longer time. Successful

business today depends upon a company's ability to quickly adapt to changes in the marketplace.

At Amway, they pride it selves on knowledge of the dynamic networking market that is quickly

becoming central to modern business.

This knowledge, and its willingness to act upon it, has enabled us to become one of the

industry's technological leaders. Through they continued pursuit of new product ideas, and by

consistently refining our existing product line, they have become one of the top providers of

cutting-edge networking products in the global market. If you're looking for high quality

products and solid customer support at rock-bottom prices, then choosing Amway really does

make sense.

BIBLIOGRAPHY:

The Amway Business Review" Amway corporation 1 September (pamphlet)

2)Amway Corporation: Annual Report - Amway corporation

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Strategic management

3)Case Study: Using Communication to develop Business Opportunities at Amway

4) "Amway Corporation" The Wall Street Journal. 15 sep 2014

Sites

www.worthwilemag.com

http://www.amway.in/

http://www.amway.in/Articles/Article.

http://en.wikipedia.org/wiki/Amway

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