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Avon
Avon
Answer each of these items fully to demonstrate your understanding of the material.
Chapter 2
1.) Select 1 Major Business of your choice as a subject and obtain its Mission Statement.
* Avon Products, INC - a direct selling company that distributes both cosmetics and other beauty items.
2.) Once selected List the Company and the Mission Statement.
Mission Statement – The Global Beauty Leader we will build a unique portfolio of beauty and related brands, striving to surpass our competitors in quality, innovation and value, and elevating our image to become the beauty company most women would turn to worldwide. The Woman’s Choice for Buying we will become the destination store for women, offering the convenience of multiple brands and channels, and providing a personal high touch shopping experience that helps create lifelong customer relationships. The Premier Direct Seller we will expand our presence in direct selling and lead the reinvention of the channel, offering an entrepreneurial opportunity that delivers superior earnings, recognition, service and support, making it easy and rewarding to be affiliated with Avon and elevating the image of our industry. The Best Place to Work we will be known for our leadership edge, through our passion for high standards our respect for diversity and our commitment to create exceptional opportunities for professional growth so that associates can fulfill their highest potential. The Largest Women’s Foundation we will be a committed global champion for health and well-being of women through philanthropic efforts that eliminate breast cancer from the face of the earth, and that empower women to achieve economic independence. The Most Admired Company we will deliver superior returns to our shareholders by tirelessly pursuing new grown opportunities while continually improving our profitable, a socially responsible, ethical company that is watched and emulated as a model of success.
3.) Complete a couple of paragraphs explaining what the scope and thrust of the Mission Statement.
The Global Beauty Leader – Avon surpasses their competitors, L’Oréal, Mary Kay and Revlon, Inc. with $10.7 billion in annual revenues, with approximately 42,000 associates, in more than 100 countries worldwide. Avon’s geographic diversity has a strategic advantage because it allows Avon to participate in higher growth markets internationally. Headquartered in New York City, in 1914 Avon opened its first non-United States office in the Canadian province of Quebec. Avon markets its products to
women throughout six regions – Asia Pacific; Central and Eastern Europe; China; Latin America; Western Europe, Middle East and Africa. Maintaining direct sales operations in 65 countries, Avon has added new operations in Finland, Albania, Macedonia and Egypt. Avon values the input of its many constituents including associates, Representatives, customers, investors, and communities. Understanding their stakeholders’ concerns and interests, and integrating stakeholder feedback, is critical to the development of their strategies in being a responsible and successful firm.
The Premier Direct Seller – Avon’s commitment to helping women achieve financial independence. Avon’s sales leadership established in the United Kingdom in 2004, open to any new and existing Avon Representative, is their network marketing or multilevel marketing plan that pays active associates and their leaders a percentage of team sales. Avon Representatives collectively earn approximately $6 billion each year and serves 300 million women in more than 100 countries1.
The Best Place to Work – Corporate Responsibility Magazine has ranked Avon one of the 100 Best Corporate Citizens from 2007 – 2010, Fortune Magazine, one of America’s most Admired Companies 2006 and 2007 as well as 50 Best Companies for Minorities 2005, National Association of Female Executives, Top Companies for Female Executives 2004 – 2005 as well as 2009 – 2010. At Avon through open communications between Managers and associates, Avon works diligently to keep associates around the world informed and engaged from the senior executive to the worker in a manufacturing plant. The internet provides frequently updated news on Avon business, associates and achievements around the world. Regions publish magazines – in print or online – to provide a deeper level of detailed news to their associates. Avon recently introduced confidential Associate Engagement Surveys, which allows their employees to candidly share their personal career experience. This helps Avon understand how to make it the best possible place to work, while simultaneously giving associates an opportunity to shape Avon’s future.
The Largest Women’s Foundation – Avon has been committed to advancing women since the company was founded in 1886 and philanthropy has always been a strong part of their heritage. The Avon Foundation is an accredited 501(c) (3) public charity founded in 1955 to improve the lives of women and their families. The Avon Foundation is currently focused on two key causes: breast cancer and domestic violence.
The Avon Breast Cancer Crusade launched in 1992, has raised and donated more than $640 million in more than 50 countries to accelerate breast cancer research and advance access to care, with a focus on assisting the medically underserved. Avon Brest Cancer Crusade has educated more than 100 million women globally about breast health care.
The Avon Foundation, Speak Out Against Domestic Violence program works to end the cycle of domestic violence. Avon has donated nearly $7 million to more than 400 United States domestic violence organizations for awareness, education, direct services and prevention programs, especially to assist children affected by domestic violence.2
The Most Admired Company – Avon pledged to provide safe, quality products to their customers through the rigorous application of manufacturing, distribution and research and development standards. Avon seeks to protect the safety, health and well-being of t heir employees. In June 1989, Avon became the first major cosmetic company to announce a permanent end to animal testing on all Avon-manufactured products. Avon does not conduct animal testing on any of its products or raw ingredients and does not require that suppliers of raw ingredients and finished products produce for Avon conduct animal testing on their behalf.
4.) Discuss how the Top Management Team can shape the culture of a firm.
* Avon’s CEO Andrea Jung first came to Avon in 1994 as the president in the product marketing group, promoted two years later to president of global marketing. In 1999 Andrea was promoted to CEO where she has been for the past 10 years and is the longest tenured female CEO’s in the Fortune 500 companies. Andrea has a strong background in market research, joint ventures and strategic planning. Andrea has been on the board of directors of General Electric since 1998, an American multinational conglomerate corporation ranked as the world's second largest company, in total sales, profits, assets, and market value of several multinational companies. Andrea also sits on the board of directors of Apple. Fortune magazine named Apple the most admired company in the United States in 2008 and in the world in 2008, 2009, and 2010. Andrea’s background of starting 16 years ago as a minority woman working her way to the top, along with being on the board of two of the worlds multinational and admired companies, learning their do’s and don’ts. Seeing firsthand what can and cannot work, can do nothing but continue to lead Avon as the leading company in distributions of both cosmetics and other beauty items.
Chapter 3
Discuss how Management must handle the Environment and Various Trends on an ongoing basis.
Avon has been committed to the environment for more than a century. Their locations worldwide are committed to reducing their global environmental footprint, including the issue of climate change, by recycling, reducing waste, conserving energy and water, while monitoring and reducing greenhouse and gas emissions.
In 2004 Avon established environmental goals and targets for the future and have made progress in the pursuit of those goals.
In 2005 Avon opened a $100 million dollar 225,000-square-foot Research and Development facility that houses over 300 research development scientist in Suffern, New York. Zanesville, Ohio is home to Avon’s state of the art distribution facility, which recently won the LEED Gold Certificate3, an internationally recognized green building certification system, providing third-party verification that a building or community was designed and built using strategies intended to improve performance in metrics such as energy savings, water efficiency, CO2 emissions reduction, improved indoor environmental quality, and stewardship of resources and sensitivity to their impacts.
Avon’s manufacturing facility in Morton Grove, Illinois, has implemented numerous process improvements and infrastructural changes that have helped Avon to operate more efficiently. Over the past three years, water consumption has decreased by 11.9 percent, or 5.8 million gallons; decreasing Morton Grove’s water consumption by 27 percent, or 16 million gallons.2
Chapter 4
What are the benefits of a business having a Competitive Advantage in a key area over it competitors?
A competitive advantage can make or break a firm, so it is crucial that all managers are familiar with competitive advantages and how to create, maintain, and benefit from them.
Many companies strive for a competitive advantage, but few truly understand what it is or how to achieve and keep it. A competitive advantage can be gained by offering the consumer a greater value than the competitors, such as by offering lower prices or providing quality services or other benefits that justify a higher price. The strongest competitive advantage is a strategy that cannot be imitated by other companies.
A company may be lucky enough to identify several potential competitive advantages, and it must be able to determine which are worth perusing. Not all differentiation is important. Some differences are too subtle, too easily mimicked by competitors, and many are too expensive. A company must be sure the consumer wants, understands, and appreciates the differences offered.
Competitive advantages can be also viewed as any activity that creates superior value above its rivals. A company wants the gap between perceived value and cost of the product to be greater than the competitor.

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