Assessing marketing strategy of Ford

Ford Motor Company is one of the world’s largest producers of cars and trucks and one of the largest providers of automotive financial services marketing vehicles under the eight brands shown below. The Company is a publicly traded company listed on the New York Stock Exchange. During 2002, the company made 6.7 million vehicles and employed 328,000 people worldwide. Business partners include 25,000 dealers and more than 10,000 suppliers.

Ford motor company offers a wealth of variety to the automotive consumer. As they start their second century of business, they are now in a position to appeal to the widest range of potential customers. Each of their automotive brands has a unique personality and holds a distinct place in the ford motor company family.

The marketing orientation has become common in companies that make things for individual customers. It remains rare in heavy industry that produces steel, coal, oil, and paper, where the immediate consumers are other businesses. The transition from the production orientation to the marketing orientation is still going on. It is the most important but least understood revolution in human history, marking a decisive power-shift from institutions to individuals. In the production orientation, human enterprise asked first what we could make, and second whether anyone will want it.

In the marketing orientation, we ask first what we want, and second how we can invent the means to fill that want. Production made people technology’s servants. Marketing makes us technology’s masters. The marketing revolution promises a golden age when social institutions and markets are systematically organized to maximize human happiness. One of marketing’s strongest features is its empiricism. What science did for perception, marketing does for production. It tests intuition and insight against empirical fact. Henry Ford thought he knew what people wanted from a car: cheap, reliable, and black.

Ford sold millions of model-Ts in the 1920s with this mass marketing strategy. Then General Motors came along, segmenting the market into many strata according to income, age, and tastes, attracting buyers by fulfilling their needs more precisely. Now all car companies work very hard to find out what people really want from cars, and they try to build cars to fit the preferences. Market research uses all the same empirical tools as experimental psychology, but with larger research budgets, better-defined questions, more representative samples of people, and more impact.

Ideally, marketing’s empiricism works like Rogerian psychotherapy: it holds up a mirror to ourselves, reflecting our beliefs and desires so we can recognize, remember, evaluate, and transform them. Ford Motor Company is undergoing a transformation that is putting their customers at the center of everything they do. Their vision is to be the world’s leading consumer company for automotive products and services. That requires a much different headset than that of a traditional automobile manufacturerone that concentrates intensely on the people who buy and use their products.

Obviously, they had had a pretty good idea of what their customers wanted in the past, or we wouldn’t be approaching our 100th anniversary. For nearly a century, Ford Motor Company has worked to improve people’s lives and be a responsible and valuable member of the community. In recent years, they have expanded and accelerated their corporate citizenship efforts, and worked to integrate them into their overall business strategy. But today’s customerand today’s competitionrequires a deeper level of understanding. Traditional market research is fine, but it’s only the start.

To transform the company, require all employees to interact directly with consumers. At the Consumer Insight Center, customers bring their vehicles in and discuss them face-to-face with Ford employees. The emphasis is on the individual’s interaction with her or his vehicle. The most well known consumer connection programs is the effort to provide home computers and Internet access to all of employees around the world . Being a leader in corporate citizenship is not only the right thing to do, but also is fully aligned with ultimate goal of providing superior shareholder returns over time.

Analysis of Employee Motivation in Ilanco Inc

The purpose of this report is to analyse the problems of employee motivation at Ilanco Inc. , a relatively small manufacturing company located in Montreal. For many years, this company operates in sweater production, and belongs to the section of clothing manufacturing industry. Currently, approximately 70 employees are working for the company. As many manufacturing organizations, Ilanco has been experiencing a lot of problems with effectively motivating its employees.

Such problems have been reflected both in the Motivating Potential Score Survey that we have conducted among the employees and in our interviews with some senior workers at the company. First, this report gives a brief overall description of the manufacturing industry and the company, Ilanco. The major parts of the report outline and analyses the main motivation problems that Ilanco is experiencing. According to these specific problems, several very useful and practical recommendations have been made to help improve the employee motivation at Ilance.

Also, in order to make this paper more insightful, some relevant motivation theories have been applied to both the analysis and recommendation sections to help analyse the problems more deeply Industry Description Manufacturing is a key activity in any economy because of its far-reaching effects. Manufacturing firms represent 20% of Canadian GDP. There are around 40 000 manufacturing firms in Canada, employing almost 2 million people. Production value comes to $135 419 millions.

Manufacturing firms with less than 200 employees represent 96% of total number of manufacturing firms in Canada, employing 47% of Canadian labor force involved in processing industry. In Quebec, the manufacturing sector generates over 20% of province’s GDP. Close to 11000 firms are operating, employing some 548 400 people. In Quebec, firms employing fewer than 200 people represent also 96% of the total number of manufacturing establishments. That is, employing 49% of province’s men-power. In Montreal, experienced labor force (1996 Census) represents 1 609 820 in all industries including manufacturing sector that employs 283 370 people.

Despite the importance of manufacturing industry, employment has been decreasing in recent years. Description of Company As an example of manufacturing firm we’ll take a look at “Ilanco Inc. “, relatively small company that falls under clothing industry sector. Company is located in Montreal’s Chabannel area and can be seen as a classical example of clothing manufactory. The firm was established in 19XX and is equally owned by two partners with considerable experience in clothing industry. Both partners do administrative work in the firm that produces ladies’ and men’s sweaters.

Because company does not have large variety of products, their workers are well trained, skillful and fully functional. Skilled labor is required for almost every part of production line. Products are tightly controlled and work is examined at every step of production process. For example, in the case of defective garments, they are being returned for reparation and later for final inspection. The average number of sweaters being produced in one working day is 1000 to 1200 sweaters. Ilanco Inc. employs 50-80 production workers depending on a season. There is approximately 40% of male and 60 % of female workers.

Preparation of fabrics and other materials that include work on steaming press and cutting, are positions held by male workers, while pattern making and sawing positions are positions held by female workers. Other positions such as thread cutting and packaging are positions equally held by male and female workers. All age groups can be seen in this company varying from workers that are in their 20’s up to the oldest worker that is 62. Concerning race, we found that production workers belong to all races. But what is very interesting is their ethnic background.

Big majority of workers are recent immigrants. There are only few of native English or French Canadians. Majority of production workers poses high school education with exception of some that have higher education. Work starts at 8am and finishes at 4pm. There is possibility to start at 7:30am and to finish at 5pm. That is workers’ choice. Working on Saturdays is required only during high season. Production workers are poorly paid. The average salary is $7/hour. There are examples of workers that work for company for 7 years and get paid $7. 75 per hour. There is no regular salary increase.

Workers have to ask for one, and the chance they will not get it. Everyone is paid by an hourly rate. No one in the company is paid by piece rate because of the type of work that is done here. There are no promotions, bonuses or similar benefits at Ilanco Inc. Description and Analysis of the problems Survey conducted with the employees of Ilanco Inc. resulted in reported lack of job satisfaction. To reach as more employees as possible, we conducted the survey in both French and English. Results of questionnaires on calculating motivational potential score varied form 70 to 110.

For the question on how much variety is there on their job, most employees answered – very little’. Other results gave a clear picture that employees have very little freedom decision wise, there is a lot of uncertainty, little control in setting their work pace and most of them find their jobs not challenging at all. This is a clear indicator that there is an existing motivational problem and that management ought to do something in order to motivate their employees because they are very valuable asset to company’s good performance.

Gillette SWOT Analysis

Gillette is leading worldwide home applicants, such as razor, battery, electronic and manual toothbrush, manufacturing company. On April 14, 1998, the company introduced the worlds first triple blades razor and begun to sell July 1, 1998 in the United States and September in the Western Europe. Since Gillette launched new razor in 1998, the company expected high returns in short-term; however, the result of the new product has been defined yet.

SWOT ANALYSIS – Key Learning The areas of the internal factors are Finance, Management, Manufacturing, Market position, Personnel, and Research & Development. All these factors can be defined as either strengths or weakness or both. First of all, the company as a whole gained net sales amount of 10. 1 billion dollars and net income of 1. 4 billion dollars for the 1997 due to acquire leading battery company Duracel in 1996 and grow of Sensor Excel razor. As a result, company could spend 1 billion dollars to invent Mach 3 which is triple blades razor.

Even though Gillette had sufficient fund to invent the new product, the company took high risk of financial side that if the new products sale does not reach to companys expectation, the company will face shortage of capital esources and can be lead to bankruptcy. But if Mach3 turn out to be a New Coke or McDonalds Arch Deluxe much-hyped new products that were mostly duds and fizzle- the gloom will be heavy from Gillettes corporate headquarters in Bostons Back Bay to the South Boston factory that Gillette has overhauled to produce 600 million Mach3 blade cartridges per year, or about half of Gillettes annual target of 1. billion Mach3 blades. (Boston Globe, 4/15/98)

Since Gillette introduced “Mach3” in April, the company changed its manufacturing tools to produce Mach3 South Boston’s factory. Gillette already spent 300 illion dollars for advertising and promotion worldwide for the year that company introduced new product. The amount is twice as much as the company put for advertising “Sensor Excel” in 1989. Gillette released the new product to retail stores on July 1, 1998, and starts to advertise on TV and the other media six weeks later; however, many people went to the company’s web site to look at the new product.

Even though company spent tremendous amount of fund for the advertising, some people from Asia did not recognize the product according to our group’s survey. For customers, there are satisfaction and complaints for Mach3. People, who satisfied with Mach3 according to our survey, said there are less irritation and faster shaving time. Customers who complaint about Mach3 argue that they do not want to spend more money on better outlook. According to our survey, one hundred percent of surveyees, who does not satisfy with Mach3, say the price is too high for the product.

Price is relatively higher than other products including “Sensor Excel” which was the most expensive one before “Mach3” came out. Its price is 6. 99 dollars per razor with one blade included – currently, the company is selling for 7. 29 dollars per Mach3. It is 4 percents increased from original price, and 40 percents higher price than other products. This may lead to decrease in sales and the companys total revenue. The company is trying to reach customers several different ways. Gillette offers Mach3 package product, which included Mach3 itself and couple of extra razors, Shaving cream and deodorant.

This package product makes each items unit price lower than sell separately. Also, the company offers sweepstakes on the company’s web site, and there is no obligation. This is the one of the finest ways to reach and get involve the customers. The company give chance to people to win prize without any obligation; however, people will recognize the product automatically. Also, Gillette can acquire the Since Gillette is well-known global company, many retail stores are not offended to carry the company’s product even though the product’s price is high.

Retail stores are assume that Mach3 will bring more customers. On the other hand, even more customers come to store, it is unpredictable for increasing stores sales revenue because price is too high so that consumers would not buy. External factors are Competitive, Economic, and Social. Gillettes major rival in the market is Shick. Since Gillette is the first company produce triple blades razor, the company will lead the market; however, rival company such as Shick will develop the same product with higher quality or lower price.

Then the result will be unforeseen unless Gillette improve Mach3s weakness – high price. For long time in the United States, peoples income has been growing. As a result, customers purchasing power also increased. However, the companys market is not only the United States but also overseas, in fact, over sixty percents of sales are made from overseas. Consequently, the company has to consider the facts that poor countries consumers are willing to use cheaper product; especially the countries in economic crisis. Recommendation There are 3 target groups in the market.

The first group is disposal razor users that it’s approximately more than half of the market. The advantages of this group are cleaner, cheaper and easy to use. On the other hand, it is less quality than other two razors. The second group is regular razor such as Mach3 about 40 percents. The last group is electronic shaver users which it takes remaining market share. The customers who use the electronic shaver satisfied with high technology, easy to use, saving time and safety compare to the other two products.

The disadvantages of this product are high price and less cleanness when one shaves. The goal of Gillette is trying to acquire customers who use disposal and electronic shaver to Mach3. In order to persuade the customers to change to Mach3, the company should beat other product’s weaknesses and add the improved the weakness of the other product to Mach3 and decreases of its weakness. Mach3 has several strengths; the first impression is fancy utlook that makes customers feel differentiated from other products.

Second of all, men are challengers, always pursue new trend; especially on the tangible items with high technology. Although Mach3 has several strengths, it also has weaknesses. High price makes people think twice to purchase Mach3; the older generation of the Gillette razor is cheaper than Mach3, that makes people wonder if it is necessary to spend more money on the Mach3. The key purpose for Mach3 is to shave beard, but the older generation is also doing same job as Mach3; that makes no different between older and newer product. The next weakness is the advertisement.

Gillette has spent 300 million dollars on the advertisement, but we did the survey with at least thirty people; 22 out of 30 surveyees know the brand from Television and magazine, but they have never uses it. This means the advertisement has preached the good news, but it has not reach people’s life. The majority of men do not know why they should spend more money to buy same result. The marketing strategy did not fail the sale of the Mach3, it is price controller. The main point of the marketing is to opening a market for product.

Since 3% of the men from the survey know the product, this mean the marketing strategy succeed its intention. The biggest mistake we found is the price. As I mentioned, “the majority of men do not know why they should spend more money to buy same result”. I would recommend to the company, to lower the price and match the same price as older generation. Let public buys Mach3 as the same price as older generation, allow public to try out differences between Mach3 and older generation. After when market demand of the Mach3 is higher than older generation, then increases its price.

Coca-Cola and its Evolution

The Coca-Cola company started out as an insignificant one man business and over the last one hundred and ten years it has grown into one of the largest companies in the world. The first operator of the company was Dr. John Pemberton and the current operator is Roberto Goizueta. Without societies help, Coca-Cola could not have become over a 50 billion dollar business. Coca-Cola was invented by Dr. John Pemberton, an Atlanta pharmacist. He concocted the formula in a three legged brass kettle in his backyard on May 8, 1886. He mixed a combination of lime, cinnamon, coca leaves, and the seeds of a Brazilian shrub to make the fabulous beverage.

Coca-Cola debuted in Atlanta’s largest pharmacy, Jacob’s Pharmacy, as a five cent non-carbonated beverage. Later on, the carbonated water was added to the syrup to make the beverage that we know today as Coca-Cola. Coca-Cola was originally used as a nerve and brain tonic and a medical elixir. Coca-Cola was named by Frank Robinson, one of Pemberton’s close friends, he also penned the famous Coca-Cola logo in unique script. Dr. John Pemberton sold a portion of the Coca-Cola company to Asa Candler, after Pemberton’s death the remainder was sold to Candler.

Pemberton was forced to sell because he was in a state of poor health and was in debt. He had paid $76. 96 for advertising, but he only made $50. 00 in profits. Candler acquired the whole company for $2,300. Candler achieved a lot during his time as owner of the company. On January 31, 1893, the famous Coca-Cola formula was patented. He also opened the first syrup manufacturing plant in 1884. His great achievement was large scale bottling of Coca-Cola in 1899. In 1915, The Root Glass Company made the contour bottle for the Coca-Cola company. Candler aggressively advertised Coca-Cola in newspapers and on billboards.

In the newspapers, he would give away coupons for a free Coke at any fountain. Coca-Cola was sold after the Prohibition Era to Ernest Woodruff for 25 million dollars. He gave Coca-Cola to his son, Robert Woodruff, who would be president for six decades. Robert Woodruff was an influential man in Atlanta because of his contributions to area colleges, universities, businesses and organizations. When he made a contribution, he would never leave his name, this is how he became to be known as “Mr. Anonymous. ” Woodruff introduced the six bottle carton in 1923.

He also made Coca-Cola available through vending machine in 1929, that same year, the Coca- Cola bell glass was made available. He started advertising on the radio in the 1930s and on the television in 1950. Currently Coca-Cola is advertised on over five hundred TV channels around the world. In 1931, he introduced the Coke Santa as a Christmas promotion and it caught on. Candler also introduced the twelve ounce Coke can in 1960. The Coca-Cola contour bottle was patented in 1977. The two liter bottle was introduced in 1978, the same year the company also introduced plastic bottles.

Woodruff did have one dubious distinction, he raised the syrup prices for distributors. But he improved efficiency at every step of the manufacturing process. Woodruff also increased productivity by improving the sales department, emphasizing quality control, and beginning large-scale advertising and promotional campaigns. Woodruff made Coke available in every state of the Union through the soda fountain. For all of these achievements he earned the name, “The Boss”. In 1985, the Coca-Cola Company made what has been known as one of the biggest marketing blunder.

The Coca-Cola company stumbled onto the new formula in efforts to produce diet Coke. They put forth 4 million dollars of research to come up with the new formula. The decision to change their formula and pull the old Coke off the market came about because taste tests showed a distinct preference for the new formula. The new formula was a sweeter variation with less tang, it was also slightly smoother. Robert Woodruff’s death was a large contributor to the change because he stated that he would never change Coca-Cola’s formula.

Another factor that influenced the change was that Coke’s market share fell 2. ercent in four years. Each percentage point lost or gain meant 200 million dollars. A financial analyst said, “Coke’s market share fell from 24. 3 percent in 1980 to 21. 8 percent in 1984”. This was the first flavor change since the existence of the Coca-Cola company. The change was announced April 23, 1985 at the Vivian Beaumont Theater at the Lincoln Center. Some two hundred TV and newspaper reporters attended this very glitzy announcement. It included a question and answer session, a history of Coca-Cola, and many other elements(Oliver 131).

The debut was accompanied by an advertising campaign that revived the Coca-Cola theme song of the early 1970s, “I’d Like to Buy the World a Coke”. The Jingle read like this: I’d like to teach the world to sing In perfect harmony. I’d like to buy the world a Coke And keep it company. The change to the world’s best selling soft drink was heard by 81 percent of the United States population within twenty-four hours of the announcement. Within a week of the change, one thousand calls a day were flooding the company’s eight hundred number (1-800-GET-COKE).

Most of the callers were shocked and/or outraged, many said that they were considering switching to Pepsi. Within six weeks, the eight hundred number was being jammed by six thousand calls a day. The company also fielded over forty thousand letters, which were all answered and each person got a coupon for the new Coke. A retired Air Force officer, explained in a letter to the Coca-Cola company that he wanted to be cremated and interred in a Coke can, but now that this change had come about he was reconsidering. Sharlotte Donneally, a thirty-six year old anthropologist said, “I hate the new stuff”.

Wendy Koskela, a thirty-five year old vice president of an insurance company said, “It’s too sweet. It tastes like Pepsi. ” She also stated, “Real Coke had punch. This taste almost like it’s flat”. Many American consumers of Coca-Cola asked if they would have the final say. When Pepsi heard that the Coca-Cola company was changing its secret formula they said that it was a decision that Pepsi tastes better. Roger Enrico, the president and CEO of Pepsi-Cola wrote a letter to every major newspaper in the U. S. to declare the victory, the letter read like this:

It gives me great pleasure to offer each of you my heartiest congratulations. After eighty-seven years of going at it eyeball to eyeball, the other guy just blinked. Coca-Cola is withdrawing their product from the marketplace, and is reformulating brand Coke to be more like Pepsi… There is no question the long-term market success of Pepsi has forced this move… Maybe they finally realized what most of us have known for years, Pepsi tastes better than Coke. Well, people in trouble tend to do desperate things… and we’ll have to keep our eye on them. But for now, I say, victory is sweet, and we have earned a celebration.

We’re going to declare a holiday on Friday. Enjoy! Best Regards, Roger Enrico President, CEO Pepsi-Cola USA Coca-Cola officials said, “The new formula will boost Coke’s share by 1 percent. That is worth 200 million dollars a year. ” Coca-Cola management had to decide: Do nothing or “buy the world a new Coke”. They decided to develop the new formula. Roberto Goizueta, the president of the Coca-Cola Company stated, “The old Coke formula, with its secret flavoring ingredient, called Merchandise 7X, will stay locked in the Trust Company of Georgia bank vault in Atlanta, never to be used again”.

This is what many Coke officials said, “This is the most significant soft drink development in the company’s history”. The change back to the old Coke was known as the Second Coming. Roberto Goizueta said, “Today, we have two messages to deliver to the American consumer, first, to those of you who are drinking Coca-Cola with its great new taste, our thanks… But there is a second group of consumers to whom we want to speak to today and our message to this group is simple: We have heard you”. On July 10, 1985, eighty-seven days after the new Coke was introduced, the old Coke was brought back in addition to the new one.

This was greatly due to dropping market share and consumer protest. The market share fell from a high of 15 percent to a low of 1. 4 percent. Roberto Goizueta and Donald Keough took full blame for this failed product launch. Don Keough, Coca-Cola president, said in response to the comeback, “The truth is we are not dumb and we are not that smart”. Roberto Goizueta’s response when the change about, “We have heard you”. This was said to be a classic marketing retreat. Coca-Cola executives admitted that they had goofed by taking the old Coke off the market.

One old Coke loyalist said, “The company had spoiled the taste of its ninety nine year old soft drink and betrayed a national trust”. Ike Herbert, a Coke marketer said, “You would have thought we had invented a cure for cancer”. The Coca-Cola company’s eight hundred number received eighteen thousand calls of gratitude. One caller said they felt like a lost friend had returned home. The comeback of old Coke drove stock prices to the highest level in twelve years. This was said to be the only way to regain the lead on the cola wars.

In 1979, fifteen hundred employees moved to the new corporate headquarters in Atlanta located on North Avenue. The new corporate headquarters came to be known as “The Tower. ” During the time when the research for the new formula was taking place, it was known as “The Bunker”. The known ingredients in present day Coca-Cola are water. caffeine, phosphoric acid, vanilla, various oils and essences and extracts of the coca leaf and the kola nut. The one in four hundred part of cocaine was removed from Coca-Cola in 1903. Five years after the infamous Coke fiasco, the Coca-Cola company tried to bring back the reformulated Coke.

The effort to bring Coke II into the soda market was quite unsuccessful. During the Woodruff era, Mr. Woodruff made a promise to the armed forces of the United States to supply Coca-Cola to every serviceperson. He said that costs and location did not matter, he supplied 5 billion bottles to the service. In the mid-1970’s, more than half Coca-Cola sold was outside of the U. S. Coca-Cola products outsell closest competitor by more than two to one. One in every two colas and one in every three soft drinks is a Coca-Cola product.

The best known trademark in the world is sold in about one hundred and forty countries to 5. 8 billion people in eighty different languages. This is why Coca-Cola is the largest soft drink company in the world. Coca-Cola is worth more than 58 billion dollars on the stock market. For more than 65 years, Coca-Cola has been a sponsor of the Olympics. The 1996 Summer Olympics were held in Atlanta, Georgia, the home of Coca-Cola. One great thing that the Coca-Cola company has is helping the people of Atlanta. They accomplish this through scholarships, hotlines, donations and contributions, etc.

Another large accomplishment that the Coca-Cola has, is being the first company to make and use recycled plastic bottles. One way to see all of the achievements of the Coca-Cola company is to visit the World of Coke in Atlanta. It houses a collection of memorabilia, samples of the products, exhibits, and many other exciting items. All of what has been said is the basis of what Coca-Cola was built on. Without societies help, Coca-Cola could not have become over a 50 billion dollar business. Keep on consuming the world’s favorite soft drink, Coca-Cola.

Staffing Orgs DELL

Dell’s mission is to be the most successful computer company in the world at delivering the best customer experience in markets we serve. In doing so, Dell will meet customer expectations of: Individual and company accountability Best-in-class service and support Flexible customization capability Dell’s vision of excellence through quality, innovation, pricing, accountability, service and support, customization, corporate citizenship and financial stability is clear. This mission statement is clear and easy to understand.

Producing quality work that leads to the achievement of these lofty goals becomes much more complicated than writing a simple mission statement. One thing is clear, the core capabilities of any business stem from the employees that comprise it. With over 36,000 employees, Dell is a member of the rapidly changing and expanding computer technology industry. This industry had achieved enormous growth in the last decade. Dell’s stock rose 29,000 percent in the 1990’s and as of the second quarter in 1999; Dell was tied for first place in the market.

Dell faces stiff competition from technology giants such as IBM, Hewlett Packard, and Compaq. With such robust expansion in the technology industry and the economy, it is becoming increasing difficult for companies such as Dell, who experienced a 56 percent growth in workforce in 1999, to fill positions with quality applicants. Dell is currently seeking applicants for positions in sales, corporate finance, engineering, manufacturing, and most especially, information technology. Dell currently hires approximately 2000 employees a quarter.

With such rapid growth and expansion the temptation surfaces to simply fill a position with a body. “Unless you have a good process in place, you run the risk of not always hiring the best people. There can be a tendency to say ‘We need people so badly, a fresh body is better than no body,’” as summed up by Steve Price, vice president of human resources for Dell’s Public and Americas International Group. To avoid this scenario, Dell has created a web-based Organizational Human Resource Planning (OHRP) process.

These processes help a business unit focus on and anticipate growth and staffing needs. In addition the OHRP process allows managers to do their own succession planning, identify key jobs, and formulate competency planning and employee development. The OHRP process also tries to pick out qualities new employees will need by analyzing the skills and qualities of current top performers. This program has been highly successful as Dell’s profitability increased 59 percent in the same period that the workforce grew by 56 percent. Analysis of current recruiting practices

Dell’s rapid growth and expansion requires recruiting processes to seek out and retain large numbers of qualified applicants. Dell begins its on campus recruitment at selected schools in the fall. The on campus recruitment takes place primarily at schools in the midwest, (Big 10), and southeast, (ACC). Dell typically makes three on campus visits to selected schools and when possible spreads these visits out over the term of the recruitment process. First round interviews take place on campus and prospects are notified with 48 hours if they are selected for a second interview.

All second round interviews are conducted at Dell’s headquarters in Austin, Texas. Prospects are typically notified within 48 hours if Dell intends to offer them a position. Applicants who attend schools where Dell does not conduct on campus recruiting may apply on Dells website. Applicants submit a cover letter and resume to the website. Resumes and cover letters are then entered into a database where they are looked over by a Dell recruiter. Acceptable applicants are then contacted via phone for and initial interview. Applicants will be notified within 48 hours if a second interview is requested.

Again all second round interviews are conducted in Austin and applicants that Dell intends to hire are notified within 48 hours. Either recruiting specialists or rotational recruiters who come from specific departments, such as the IT department, generally conduct interviews. Specialists from specific departments are generally used in time of peak hiring demand. These specialists are able to use their knowledge and experience to give a unique prospective, as they are the ones who are actually doing the critical jobs. Dell recruiters expect that interviewees have knowledge of the company and the industry in which they compete.

All the information applicants is available on the Dell website and prospects are strongly encouraged to look this information over. Dell uses a competency based interviewing process. Interviewees are asked to draw on past personal experiences and comment on how the situation was handled and what was taken away from the experience. Dell feels that this allows interviewers to get a good feel for the individuals fit to the jobs required competencies. Dell looks for individuals who posses strong internet and computing skills.

They look for individuals who are self-motivated and can thrive in a fast paced, results oriented environment. Dell has a very relaxed structure and very few concrete policies or ways of doing things. Some individuals to not work well in this setting and the interview process seeks to week those candidates out. Dell attempts to retain the best personnel in the industry by offering industry competitive compensation and perks. Compensation includes: Industry competitive salary, lucrative health benefits packages, 401k programs, profit sharing and bonuses, stock purchase plans and continuing education.

Some of the perks of working for Dell include: On-site health clubs, employee deals on computers, and services to help them manage some of the chores in their personal lives. All of these perks are intended to make it easier for the individuals to concentrate on their role at Dell. Dell feels that workforce diversity is crucial to the success of the company. They feel that diversity is more than just a catch phrase or the right thing to do. They feel that true workforce diversity is a business strategy that fosters creativity and innovation. Dell actively recruits at many culturally sponsored job fares and events.

Through this attitude and these policies, Dell has been successful in creating a diverse workforce, and a strong corporate culture. Throughout the last decade, Dell has experienced staggering growth in the computer industry. They have emerged from an 18-employee basement operation to the leading supplier of computers in the world. During this time of rapid expansion, Dell has maintained a quality workforce that has made great strides in becoming the company envisioned my Michael Dell. While past recruiting practices have been largely successful, I feel specific areas are open for improvement.

It is my recommendation that Dell expand its on campus recruiting efforts to include more schools in the United States, and abroad. I advise that Dell should launch an on campus advertising campaign to promote recruitment through their website for schools without scheduled campus visits. Lastly, I recommend that Dell increase its use of rotational recruiters to provide a better prospective on interviewing. To meet anticipated demand, I feel that Dell should increase the number of prospects by increasing the number of schools it visits.

Recruiting efforts are largely focused on midwestern and southeastern schools, primarily Big 10 and ACC schools. I feel that the company should branch out and extend on campus visits across the country to include Big 12 and Pac 10 schools. These schools are untapped resources for prospective employees. To promote this expansion without dramatically increasing costs, I recommend that Dell cut the number of on campus visits of selected schools from three to two. I feel that this provides adequate exposure to these markets while allowing staff to visit more schools.

In addition to expanding on campus recruiting in the United States, I feel that Dell should expand its recruiting efforts to major universities abroad. Dell feels that diversity is a major competitive advantage that fosters new ideas. I feel that this diversity can be vastly improved by overseas recruiting. I recommend that Dell expand its recruiting efforts to areas such as Europe, India and South East Asia. In addition to gaining exposure through broadening on campus visits, I recommend that Dell launch an on campus advertising program promoting recruitment through the company website.

Simple advertising techniques to increase knowledge of the web presence could include: Contacting on campus job placement offices and providing them with company information and web instructions, on campus distribution of flyers and posters to be places on or around commonly read bulletin boards or boards with job information. Some advertising could be done in school newspapers and magazines as well. I feel that increasing web-recruitment awareness is the most important aspect of my plan to increase correspondence with eligible applicants.

To attract and retain eligible applicants, Dell should broaden it use of a rotational recruiting staff. A rotational recruiting staff places individuals in industry fields in the recruiting market. This provides prospective applicants with insight on the actual requirements and demands of the job, reducing turnover and increasing job fit. For Dell to continue as a leader in the rapidly expanding technology industry, they will have to maintain their recruiting advantage. I feel that the recommendations presented in this paper will keep Dell at the forefront of the technology industry.

International Strategic Management

Strategy is usually related and sometimes confused by people with planning. But as time course shows in the study of companies, there are different approaches of how a company can develop its strategy. Johnson, and Shcoles, in their book “Exploring Corporate Strategy” had studied the different ways that companies develop their strategy. The authors had formulated and structured three general ways how companies build it, there are: the design, experience and ideas lenses.

Exploring Corporate Strategy” literature explains that these are the main streams how people perceive that strategies are developed, but these streams are not exclusive but inclusive and can be combined to develop each company’s unique strategy. A good example of the former it’s the incursion of Honda to the US motorcycle market in the 1960’s, studied by different approaches as so as external and internal point of view.

For Boston Consulting Group and Harvard Business School, it was a more design lens approach of how Honda incursion in the US market. They state that Honda’s strategy was directed towards high volumes per model, providing high productivity, and low costs. Their main overview highlights that Honda succeeded in US by introducing a new product (small motorcycles) that expanded the motorcycle market in the US through price generic competitive strategy. They underline that in 1959, Honda was already the largest motorcycle producer in the world.

That suggests that Honda was prepared with capacity, capital and technical capability to enter the US market. However through the US Honda launchers point of view their incursion was not a matter of those issues, neither a designer strategy approach. They stated “In truth, we had no strategy other than the idea of seeing if we could sell anything in the US”, so from their lens, the strategy was to explore a different environment and find a niche to position the company.

By the other hand at the beginning they appoint that they try to adopt an experienced strategy, by going directly to the retailers, but the situations with the large machines lead to a changing environment that pushed them to an emergent strategy. Mr. Honda was more an ideas lens strategy leader; by encouraging he’s executives to generate ideas to “success against all odds”. He didn’t established a rigid strategy by ordering to focus in certain product, he foster the emergent patterns, and acted as a coach.

Every company uses or finds different ways to develop their corporate strategy. While Honda preferred to manage with the emergent opportunities in order to construct their expansion strategy, Ericsson in the counterpart designed their corporate strategy based in analysis and planning, “The Company made a bold strategic change, forming an entirely new business area, Ericsson Information Systems”. Their strategy included the acquisition of new technologies, resources, etc.

Ericsson’s designed strategy failed, “but the market growth predictions faltered immensely and so did profit expectations”. As result of the segregation of ERA, their strategy was different; it was continuously built by the emerging opportunities, and generating new ideas. For these companies strategic leadership was always there, Mr. Honda acting as a coach, and Ericsson’s CEO as a tight planning controller, and Lundqvist as an entrepreneur. All these reflected in the success of the outcomes. Politics were highly used in the development of the new Ericsson’s business.

Since the beginning the internal politicking was presented in the different areas of Ericsson, mainly between the SRA CEO and bureaucrats of the corporation. Politicking was also involved with the outside negotiations to gain a concentrated business sector, “after much pressure and debate corporate management finally gave SRA the business and responsibility for the system as a whole”. Hondas case was different because there was not conflict or struggle between the CEO and the executive’s vision, so not much politicking was involved. Logical incrementalism, was presented in different ways for them.

For Honda’s external point of view it was built up on experienced success, while for the insiders it was a search for opportunities and taking advantage of them in order to exploit the niche. Ericsson, is a complete different story, while the corporate tried to drive the company to certain vision (Information Systems), and failed at the same time that the smallest branch struggle to achieve its own vision. Suddenly the whole business transformed towards the successful vision, “By the turn of the century Eriksson was completely dominated by the mobile telephony business”.

Thought the change in the markets and the development of new technologies, as result of natural evolution as Darwin appointed, every organism has to evolve as the same pace as the environment in order to survive. Companies have to change from time to time, because, what was a need yesterday, it might not be today. So companies had to seek new horizons and search more opportunities, change their strategies as new ideas emerge, in a structured and operational planned change, helped by experience and an entrepreneurial attitude towards to the unknown future to redesign their selves.

United Parcel Service Strike

In early August of 1997 the United Parcel Service (UPS) had a predicament on its hands, a teamsters strike. UPS, the worlds largest package distribution company was coming off a year [1996] in which they reported sales of $22. 4 billion. UPS Employed 75,000 management and non-union employees compared with 185,000 teamsters who are part of the AFL-CIO that were going on strike. The teamsters rejected a contract extension offer from the company leaving the fate of millions of packages carrying everything from lobsters to laser printers up in the air (Johnson).

Tensions between union supporters and management began mounting in the years preceding the strike. In April of 1994, the International Union led a three-week strike against major tracking companies in the freight hauling industry in attempts to stop management from creating $9 per hour part-time positions. This would only foreshadow battles to come between management and union. Later, in 1995, teamsters mounted an unprecedented national union campaign in attempts to defeat the labor-management cooperation scheme that UPS management tried to establish in order to weaken the union before contract talks (Witt, Wilson).

This strike was distinguished from other strikes of recent years in that it was an offensive strike, not a defensive one. It was a struggle in which the union was prepared, fought over issues which it defined, and one which relied overwhelmingly on the efforts of the members themselves (http://www. igc. org/dbacon/Strikes/07ups. htm). The teamsters campaign at UPS was unique in that there were many special circumstances surrounding it. UPS controlled 80% of the ground package delivery business, which ensured them that a strike would have a significant impact on the economy and pressure the company to settle.

The company was not a conglomerate that could withstand the walkout since it did not have other lines of business. Also, UPS delivers to every address in the U. S. , adding a hometown story in most cities and towns. The last circumstance was the fight was taking place during August when Congress is out of session, making it easier to gain national attention (Witt, Wilson). This strike was a battle over several issues. One factor that escalated the strike intensity was the pensions battle. Billons of dollars in pensions were on the line.

The Teamsters were reluctant to allow UPS to withdraw from the multi-employer teamsters-controlled pensions plans. UPS proposed a plan that would increase the monthly pension benefits for full and part-time employees an average of 50 percent. The current pension plan benefited thousands of teamsters retirees that never even worked for UPS . Basically, UPS wanted UPS dollars to go to UPS people (UPS vs Teamsters). Before the strike, in many regions UPS participated in multi-employer benefit plans in which several shipping employers jointly pay for employee benefits.

If one employer goes out of business or gets behind on payments, the other employers must compensate for the loss. This explains why it is said that UPS pays for the retirement and benefits of people that never worked for them (Business News New Jersey). Another issue in negotiations was full-time versus part-time positions. UPS employees argued that too many workers were working 35-45 hours a week, often at two different jobs, for part-time pay. Having about two-thirds of all teamsters being part-time this was a central issue.

They wanted these part-time positions to be converted into full-time positions. UPS claimed that it did not want to guarantee full-time positions because of fluctuations in work and wants flexibility for competitive reasons (UPS vs Teamsters). Along with full-time positions and the pension arguments, strikers wanted limits on giving work to subcontractors, and health and safety improvements. John Cortez, a warehouseman for UPS has been surviving for five years on the same part-time job he got when he was young and single.

Working 26-28 hours a week and no having a wife and kids Cortez claimed it is not enough hours to pay the bills. With a waiting line for a full-time job so long that it will be another five years before Cortez would achieve full-time status. Teamsters union strategists and the UPS bargaining committee took a look at the problem of part-timers like Cortez. Knowing that his future was up in the air, Cortez and others sharing his interests would unite and keep the union members on the picket line as long as necessary (http://www. c. org/dbacon/Strikes/07ups. htm). During the 15-day strike many businesses suffered. One business, Mail Boxes Etc. , saw its shipping volume drop by 75%. Commenting on the situation, they stated that they diverted as much as they can of their shipping to other carries but it is difficult for other carriers to absorb 80% of the shipping for the entire state [New Jersey]. All over New Jersey companies ranging from pharmaceutical giants to small bakery shops faced the impact of the strike.

With speculation surrounding government intervention in resolving the strike, UPS kept a skeleton operation going with management behind the wheels of the companys famous brown trucks. One company normally running with 150 local drivers moving 40,000 packages a day continued running with 80 drivers from the management staff (Business News New Jersey). Another industry affected by the strike was the movie business. One firm, Technicolor Entertainment Services, handles distribution for several major studios promised to hand carry film canisters on commercial airlines if necessary.

A distributor for studios such as Disney, MGM, Universal, and Miramax Technicolor used UPS for materials such as promotional displays for theater lobbies. Companies such as Technicolor typically already work against tight deadlines, with the strike it only made things worse (http://channel2000. com/news/stories/news-970805-191537. html). While customers attempted to find alternative ways of distribution other than UPS, the many competitors, the U. S. Postal Service, FedEx, Emery Worldwide, ETA Express, DHL Worldwide Express, and RPS Inc. were not nearly capable of handling the near 12 million packages that UPS shipped daily. FedEx was and remains the strongest and most competitive competitor. If nothing else, this strike alerted competitors to the profit opportunities in fight UPS for market share. (http://www. igc. org/dbacon/Strikes/07ups. htm). After a fifteen-day strike, Teamsters and UPS management came to an agreement on a tentative contract.

At the start of the strike the company offered to advance 10,000 part-time workers to full-time jobs as other full-timers retired or quit, while only agreeing to create 1,000 new full-time jobs. In the final agreement, 10,000 new full-time jobs are to be created over the next five years. Another incentive to the deal was that five out of every six full-time openings would be filled by part-time UPS workers. UPS originally wanted to subcontract out the jobs of feeder drivers, the people that drive big-rigs between terminals.

However, knowing that those jobs are promotions and typically held by the most senior drivers. Union officials fought against and defeated this. Existing full-time employees received wage increases totaling $3. 10 over five years and full-time, high-seniority workers won substantial increases in contributions to pension plans (http://www. igc. org/dbacon/Strikes/07ups. htm). The union got full-time work while management got their workers back to work. In determining who got the better end of the deal it could go either way.

The union did get the full-time jobs they wanted, however the union members not seeking full-time work lost out in the deal. Both management and union were hurt in regards to lost business resulting from the strike. While it appears the union did get most of the things they asked for, they were negotiating quickly knowing that any time a back-to-work order by President Bill Clinton was possible. I believe that this strike was clearly avoidable, however the union decided they wanted to make a statement and I feel they were for the majority successful in getting what they wanted.

UPS did not appear to gain a lot from the deal, along with losing market share in the process a feel it was a slight loss on their part. There did not have to be a strike, but in striking I feel that the union got their point across. Management should have examined the full-time/part-time issues more closely in attempts to satisfy more employees. If employees felt they were safe and secure with their work status I feel they probably would not have went on strike.

The significance of this confrontation is that it gives Teamsters hope that management can be overcome if the union power is strong enough and the cause is a viable one. In the days following the strike UPS stepped up efforts to maintain its current customer base without losing a significant market share. UPS officials stated that they felt they could gain back nearly all small customers lost while possibly losing a few corporate clients.

In efforts to reassure its customers in the days subsequent to the strike, UPS telephoned nearly 1. illion customers to reassure them along with promising not to raise rates for the remainder of the 1997 year (Frank). Who exactly won the strike? I feel that the Teamsters were the winners in this case. They got the majority of their requests while giving little ground to management. The teamsters gave a little ground when they agreed to a five-year contract instead of the two or three year deal they were looking for. The union got UPS to create 10,000 full-time jobs from existing part-time positions compared to 1,000 which was originally proposed by UPS.

Along with getting a slight increase in pay, the Teamsters got to keep their existing multi-employer pension plan UPS attempted to do away with, clearly another Teamster victory. While UPS may have suffered some from pressure brought on by President Clinton, they got the Teamsters back to work. All in all, the union got almost everything they wanted with a little longer contract than they were looking for, clearly a union victory. The following table, with information from Alan Dodds Frank, summarizes what the Teamsters won, and what they conceded.

Boeing company paper

Most of us see aviation as a means of transportation and an alternate mode of travel. Boeings businesses are clearly doing one of the things that core businesses are suppose to do. They are making lots of cash. For many years Boeing has been the leader, earning an average cash flow of a billion dollars or more each year. This gives lots of options to maximize shareholders values. This company just seems to have lots of outside areas of interest too. Maybe youre bored sitting around the house and had a craving for some pizza.

Did you ever wonder how its stays so hot in twenty minutes after the drive leaves the restaurant? Its the space-age thermal incubator, one of the many things the food industry acquired from Boeing space and communication program. There were two events that made a significant change in the history of modern aviation. The Wright Brothers first flight and William Boeing, born October 1, 1881 in Detroit, Michigan. He was the founder, owner, President, and Chairman of the board from 1916-1934. He took advantage, in 1903, of small risky ventures and made a big financial gain.

He lived until 1956 long enough to see the company go into the jet age. Since the beginning, Boeing has become an aviation giant with an estimated $2,375 billion a year in sales. In 2ooo, Boeings stock appreciation was 59 percent, the second highest in Dow Jones Industry Average. When put together with dividends, Boeing earns a 61 percent total return for their investors. They also have a place in space communication as well. In 2000 they signed agreements with the government of Turkey and Australia worth $2. 5 billion.

They are to provide 737 aircrafts, plus ground support for mission crew training mission support and systems modifications. Boeing also has a capital corporation in which it leases and lends money to other corporations such as General Motors, Disney, State Farm, and a host of others. For more than 30 years it has been a worldwide provider of lease and loan financing for a wide range of commercial equipment and all types of commercial aircrafts and business aircrafts. Military Aerospace support is also a big venture for Boeing too. This has become a key role in business deals.

The revenue generated from the military is approximately $3 billion. That amount is expected to triple in 10 years. Boeings jet business is increasing in size and is recognized around the world executives and private individuals as a comfortable, and productive business to be involved with. In addition, a partnership between Boeing Business Jet and Executives provides access to the BBJ for individuals and corporations who have a requirement for large, long-range business airplane but who cannot justify the cost of owning the entire business jet.

Operation revenues for 2000 were $51. 3 billion compared with $58. 0 billion in 1999. The lower revenues for the years 2000 are because decreases in deliveries in the Commercial Airplane Segment. Commercial Airplane products and several ventures account for 61%, 66%, and 66% of the total operating revenues for the years 2000, 1999, 1998, respectively.

Another segment of operations are the Military Aircraft and Missiles. Their earnings for 2000 and 1999 were $1. illion and $1. 2 billion, respectively. With sales like this, one can easily see why I choose this company. If not for their part in helping provide faster transportation system to the world then surly, from serving in the United States Navy for over nine years. They have provided us with some of the fastest and tactical aircraft like the: F-A5, F/A-18E/F, and the V-22to name just a few. One can only wonder what they have in store for our future.

Space and Communication are too far back in the Stone Age. True enough we have advanced far, but the biggest is yet to come. Boeing provides us with Hughes space and communication, satellites, and a global system like no other. High-speed broadband service worth about $82 million is the one I feel is the most important. Boeing research products for this side of their company cost about $500 million, this proves why they are number one in leading the world in so many areas.

Boeing is not just a company to me; they are like the employer, and the employee. With out them our military would not be as far as we are today. I would have not known about the aircrafts that I do know about now, or may have never joined the service. They are not only makers of aircrafts, satellite communications and high speed broadband, but they are ranked among the best in the world, and not just in the United States. Their company provides services to many other nations in the worlds, as we know today.

Cannington Remuneration Policy Investigation

The organisation studied for the purpose of this investigation is Broken Hill Proprietary / Limited (B. H. P. ). B. H. P. is Australias largest company and was ranked 125th on the fortune global 500 list of the worlds largest industrial companies in 1993. The company was incorporated in 1885 and began mining silver , lead and zinc at Broken Hill in NSW Cannington is BHPs latest mine which is still yet to officially open, the mine was a Greenfield site discovered in June 1990.

BHP is currently evaluating a world class silver lead and zinc deposit located in Cannington near McKinlay, North Queensland The company currently hold a mining permit for 7660 hectares in the area, it is estimated to be the largest silver mine in the world. The general context of the policy is focused on the change of attitude between management and staff on the Cannington site and the out come of the specific remuneration policy will hopefully be to attract and retain a good team of employees in order to recognise the value of the BHP workers and to extract maximum wealth from Cannington silver, lead and zinc deposits.

By undertaking this investigation I hope to achieve a better understanding of the remuneration policy and how and why the policy was changed in the beginning of the Cannington project. I will also hope to achieve an understanding of future direction. To complete this investigation I will use information about the previous and current remuneration policies related to previous projects completed by BHP. I will also investigate, the pressures involved to inspire the Human Resource Management Department to change the policy, the new policy, and the desired effect the change is designed to have on the current mining site.

I will also explain the effect the remuneration policy will have on structures and the effect it will have on activities of the business as well as the evaluation process used by the management to ensure that these policies are working. I have obtained this information from a lecture given by Glenn Morrow the manager of the Human Resource (H. R. M. )Dept. at BHP. Mr Morrow gave a speech on the organisation in which I am investigating and also on the Cannington site in particular .

He achieved this by using overhead transparencies showing the objectives of the Cannington site, we were also given a copy of all of the overhead transparencies in the form of a booklet. The specific human resource management policy prior to change was effective in order for past projects, but Cannington is different to all previous sites such as BHP Manganese, BHP Iron Ore and BHP Australian Coal which were all examined and were not approved because these previous policies were based on people living close to the workplace.

The second major reason these previous policies were not approved is because in the case of Cannington B. H. P is the provider of transport, social recreation, and all meals because Cannington has no local community as it is five hundred kms from the nearest town. The old policy states that there is a base pay, site allowances depending on the danger in the particular environment and for the inconvenience of being away from home, shift allowances for evening and night shift workers.

Bonuses for meeting deadlines such as monetary and leave aiding, and annual leave pay outs vary depending the value of the employee these bonuses for a valued member of staff can include transport and accommodation paid holidays for contractors as well as officials and families of these people. Management perspectives on pressure for change in the Human resource management policy include. All established remuneration policies are based on people living close to their work place.

All of the workers live at least five hundred kilometres away from Cannington therefore it is impossible for workers to rely on personal transport to arrive at work promptly in the early hours of the morning to start work. In response to the pressure B. H. P. has supplied a twenty seater plane for transportation to assist in the commuter “Fly In Fly Out” operation, which is free of charge to employees, on condition of this is that all workers must work for fourteen days whilst working twelve hour shifts in a twenty four hour mine and living on the Cannington site before being flown back to Townsville.

The employees will live in the companies newly built motel style bed sitter apartments which are located five hundred to one thousand meters from the under ground mine. At the end of the fourteenth day the workers return home for seven days break before the next shift begins and the same procedures take place. Meals are supplied daily in a common dining room B. H. P. ensures that employees will be as comfortable as possible and taken care of .

Another pressure involved is remoteness, workers wanted stability in their wage and BHP wanted to attract the best so annual pay is offered to employees, this makes situations such as self-sufficiency for employees and the families of employees possible, it also motivates workers to stay on the work force because it is an aim of B. H. P. to promote flexible and multi skilled employees who are in the long term valued as an asset to the company, the employees that are multi skilled are also eligible to higher pay according to specific qualifications.

Multiskilling is important for all organisations because if for any reason staff is short their would be a loss in productivity and costs of re-hiring when interviewing takes place. Team pay will also be implemented for team ideas, team solutions, routine and rise in production. The evaluation of the comprehensiveness of the policy takes into account the polices impact on other areas of the human resource management policy within the organisation, such as Occupational Health and Safety.

The Occupational Health and Safety policy states that every six months all employees must stand a blood test to ensure that he or she is not being over exposed to lead or any other toxins in the air. If the employee is proved to being over exposed they will be classified as being unfit for mining conditions in the interest of their own health and according to company standards, the employee who is over exposed will be redeployed or relocated to another task at the companies expense The evaluation policy also looks at training .

Training is a compulsory company objective so that workers are properly made familiar with any new or updated equipment or technology and so that miltiskilling can be enforced in the workplace. By enforcing multiskilling in the workplace all workers will be more aware of their surroundings and in term more responsible for their designated areas of labour. The hiring policy has also been evaluated in the sense that BHP will from now on only require people with practical experience not just qualifications in the field, these employees that are recruited will be paid accordingly to their practical experience.

This will ensure that multiskilling becomes an easier part of training and will in term increase productivity and the effectiveness and punctuality of the tasks in hand and this is reflected in the remuneration policy. A specific area of change to the remuneration policy includes the Activity structure which includes facilities for employees, such as a twenty five meter Swimming Pool, Volleyball Court, six hole Golf course and Cable TV The site is also equipped with Bed sitter style apartments and a dining and meals area with a separate wet area where alcohol is provided in moderation..

This is only what has been built so far, actual use of the mine by employees in mid October will determine what other facilities are to come. As result to the on-site contracts given to employees there is a change in structure, B. H. P. will provide a counselling service to deal with stressed employees and also to deal with the families of employees who are struggling with out their spouses.

This service will be beneficial if it is necessary and the service will be free of charge. Another change in structure includes that BHP has included a Transport Co-Ordinate to their staff list, this person will ensure the Fly In Fly Out program runs according to plan. The response of the remuneration policy for the Cannington site has uncovered that the policy is expected to be highly successful in its new areas. The employee survey (will be distributed every six months).

BHP prides its self on its three main goals Attraction- the ability to grow and use skills to achieve a high outcome, Retention- the ability to retain employees for the welfare of the employee and interim the welfare of the organisation, if BHP is able to retain at least ninety five percent of their employees this area of the policy will also prove the policy successful ; and Motivation- the individuals understanding of the organisation and their contribution to team work. The policy response will also take note in the future of the productivity rate of the steel being mined.

The results will be compared to the average figures and figures compared with competitors. If the policy is effective it should show a higher productivity rate compared to the competitors, if the policy is not working the productivity is expected to be at or below average. If the productivity rate reduces by over five percent the policy will be a failure, in this case BHP will ensure that employees in the area of fault will be required to attend extra training and the policy will be reviewed thoroughly.

If the policy is taking effect and the majority of people are happy this will be clear because the Unions will not have much to say. Due to the change of the remuneration policy, people will work as part of the body of the organisation, the employees will determine what the site is lacking and what has to be evaluated, they will be given this opportunity with evaluation surveys which will be distributed and carefully evaluated and considered once returned, these surveys will consider work, recreation and living necessities.

The experience and the evaluation of surveys will benefit in the long run as the structure of the Cannington site will improve in productivity and living standards. The plans on the site can also possibly be used as a model for future projects. The evaluation is expected to be successful because suggestions and opinions are in writing and not just word of mouth they are better recognised. As result of these surveys employees and their families can feel more stable knowing that their problems have been addressed formally by the management team.

If ninety five percent of the employees return a positive opinion (as expected) this will indicate job satisfaction and the policy a success. At the moment BHP maintains a fast growing production rate, and expects to keep on doing so. In the future I believe the changes will be made in the area of rewards. Rewards will be offered to those who perform at a worthy standard and for lengths of service for the organisation. Annual welfare should also be offered to those who perform above this company standard.

In the future BHP will at some stage have to introduce rewards and bonuses for targets met in the productivity and production line these rewards and bonuses could include annual airfares or other rewards. If these introductions do come in to action, BHP will need to employ more staff as the mine expands. In every organisation there is room for improvement, and BHP is no exception to this. I believe that the likely future responses to the current Remuneration policy will indicate that the policy is one of well being and will indicate a positive direction in recruiting employees and the position BHP holds on the rich list.

Alcohol Maker`s Responsibility

Companies should examine the issues facing their industry in general and their company in particular, such as the trend to prevent cancer in the smoking industry. Companies should also look at the impacts they have on the community and region [the petrol case]. Doing these two things would keep the company fresh and familiar with trends, as said earlier and changes in the buying environment, which Bennetton could of used in their problem in Germany.

There is also a need to be sensitive to the community’s feelings and needs, meaning that aution is required when designing packages or advertisements for a product so not to trigger a negative public response. Keep the idea that there are religious groups, races, or someone of another sex that might be offended. After a promotion is set up it should be culturally tested and the examined to see the effectiveness on sales after release as well as it’s effect on the consumers and their perception of the promotions/advertisements.

After all perception is everything. Another idea is to also have product tested by a sample group, just e for release, in order to see what response will be obtained from the public. This is to see if the response would be favorable or negative. For example, 2 years ago Nike released a shoe that had a logo on it that angered Moslems in the United States and forced Nike to recall the entire line of shoes for redesign. The shoe had a logo, which looked like a burning tree [such as in the bible].

This testing should be implemented in the different locations of the release of the product since there are different cultural values, beliefs, and perceptions. There should also be a good product recall program, developed a head of schedule as an eventual alternative to the development of a product, as a safety precaution. If after the release of a product defects are detected, there should not be any delay on recalling the product from the market.

Failure to do this could result in either business suicide or face the possibility of lots of legal ramifications in the bitter near future. Image management When being accused of polluting the environment, image management should come into play. This could be done by a number of ways:

1. Keep a list of positive things the company does, which it can use in replies to letters and media inquiries: “we use rechargeable batteries”; “our people drive low-polluting vehicles”; our packaging reduction program has cut waste by __ percent, or __ thousands of tons per year. Sponsor a partner on a “green” event with another business, non- profit organization, or school: beach, road, or lake shore little cleanup. You could also say, ” we recycle”.

2. Give away items to your customers with recycling, energy-saving, water-saving, and other ecological tips on them. Produce public service ads for local papers about your model environmental practices. Stage a weekly contest at your company, mall, or business community for environmental improvements, i. e. least total garbage produced, most packaging reduced, hazardous material substitute discovered, etc. Pay bonuses for or award prizes for greatest savings generated to the company.

3. Sponsor an environmental program on public radio or television, donate office equipment to an environmental group, or donate a portion of property as a public gardening plot. Donate to school environmental rograms, non-profit environmental groups, garden clubs, and other organizations that work in partnership with businesses and citizens to improve environmental health.

Work with a youth organization on a community-based environmental project, such as plastics recycling, or a hazardous waste or litter clean up day. Alert media to your participation. Call the media any time you sponsor an event [good publicity]. One method of curing problem of excess waste: While image management is taking care of public relations, the company can focus attention to the internal problems [accusation] of inefficiencies and polluting. This problem could be lessened by: Encourage employees and staff to report any resource wastes and environmental concerns.

Place efficiency posters, stickers, or balloons where energy, water, and materials around heavily commuted areas at work [post in places like bathrooms, employee lounges, cafeterias, and kitchens]. Use conservation slogans or messages, change locations to keep up interest. Place articles about conservation and efficiency in company newsletters or on bulletin boards. Attach resource and efficiency messages to employee paychecks and invoices. Reward employees for improved efficiency in esource uses.

Provide your employees with discount coupons to local nurseries and hardware, electrical, and building supply stores for drought- tolerant plants, reusable and durable goods that save materials and reduce waste, and equipment that saves energy and water. Conclusion If the product’s advertisement or company is viewed as unethical by it’s consumers it would be in that company’s well being as a profit maximizer, to change it’s ways. After all satisfying the consumer is one of the goals, even though it means severing connections with unscrupulous associates.

Study of Procter and Gamble

A Company like Procter and Gamble can attract the attention of any one in the whole world. It made and still makes the life of any individual much easier by providing him with reliable products that he appreciates for their superiority and their safety. Today, in Egypt, the products of Procter and Gamble have conquered the Egyptian market. In every house, one or more products are found. As a result, the Egyptian local products could not compete with this outstanding quality that P & G offers. The public is interested in gathering more information about the company.

That is why, knowing more about the earlier foundation of the firm, its purposes and core values, the process of innovation of its products, its annual report and the link between it and its branch in Egypt could satisfy the people’s curiosity. Procter & Gamble refers to William Procter, who “established himself as a candle-maker”, and James Gamble who “apprenticed himself as a soapmaker” (P&G History 1). Procter and Gamble first started in 1837 in Cincinnati. At that time, the marketplace in that country was not encouraging to run businesses because of many financial problems.

Despite that, P & G ran their company. More specifically, on 12 April 1837, William Procter and James Gamble started to produce and to offer these products to customers. They both started with two main products, which were soap and candles. At the same year, and precisely on 31 October 1837, Procter and Gamble signed up the contract of their partnership and started their business together. Twenty years after signing the contract, P & G sales reached $1million and at that time the company had about eighty employees.

In 1862, and during the civil war, P & G Company was ordered to produce a big quantity of soap and candles to fulfill the Union armies’ needs. Seventeen years later, a new type of soap called “Ivory” was invented. By 1890, the types of soap that P & G was producing were about thirty taking into account the “Ivory”. In the same year, the demand for soaps was increasing. Thus, to be able to meet the customers’ increasing demand of their products, P & G company decided to expand the business to go outside Cincinnati to reach overseas and this “increased capacity and improved distribution of products to customers” (P&G History 2).

Later on, P & G started to develop more products and this happened in 1911 when P & G Company introduced for the first time “Crisco”, which is a type of vegetable equals to the butter, but was more economical. One century after the establishment of the P & G, “sales reached $230million” (P&G History 2). Throughout years, P & G continued developing new products. In 1987, the company was chosen to be “the second oldest company among the 50 largest fortune 500 companies” (P&G History 3).

Five years later, “P&G received the World Environment Center Gold Medal for international Corporate Environmental Achievement” (P&G History 4). One year after this recognition, P&G Company’s sales reached $30 million and even more. In 1995, P&G was given another medal, which is the National Medal of Technology, which is considered “the highest award the United States bestows for achievement in technology” (P&G History4). Generally speaking, P&G is one of the factors that led to the economic growth and the welfare of the world because it gave the chance to more than 110,00 people to work.

Like any other company in the globe, Procter and Gamble Corporation, set their own objectives and goals in order to achieve their main purpose. Their purpose is to provide products of superior quality and value that improve the lives of the world’s consumers. By achieving their purpose, they will be rewarded by their consumers with ” leadership sales and profit growth” (P&G Goals 2), which will, in turn, affect their communities, their people and their share and stock holders to live and work in welfare.

Moreover, P & G identify their core values such as “leadership, ownership, integrity, passion for winning and trust” as priorities (P&G Goals 2). By implementing a plan based on these core values, they will be able to achieve their aim. They believe that building their organization from within, by promoting and rewarding P&G’s people, whom they value and consider them as their most important asset because of their faithful work and excellent performance, is the best way to succeed.

Procter and Gamble then respect all individuals; consumers and their human resources, and offer them their trust, on condition that they treat them similarly. Furthermore, P & G’s main target is to focus on work in order to be the best seller in this global market. Leadership, which is applied in the areas of responsibility and commitment, is a factor that enables Procter and Gamble to accomplish their target. In case of ownership, they let the employees behave “as the owners” of the company, because such policy allows everyone to be contribute more to the success of the firm as if it’s his own business.

Another core value that we put to use is integrity. Procter and Gamble follow their code of ethics by always trying to do the right thing, abiding the law, being honest and devoted to work, to each other and to the well being of the organization as well. Their strategically plans have proved to be working efficiently because they are professionally recognized by the whole world. Many institutions and magazines awarded P & G. Examples of awards are “The World Most Admired Company” which was sponsored by the Fortune Magazine in 1998 (P&G Awards 1).

As to the Environmental Awards, their awards are “Sustained Leadership in Waste Protection” given by U. S. Environmental Protection Agency, as well as, the Thomas Addison Award for the “Global Leadership in Environmental Quality Management” (P&G Awards 2). Procter and gamble company is a complex organization which produces different types of products especially that it distributes its products in 140 different countries, and its aim is to reach the taste of the consumer in every possible way. P&G began in the 1911 when they first produced vegetable shortening.

However, it is always in the state of innovation by producing new products every day. The way to reach success was not easy at all, because it is easy to produce anything, on the other hand, it is difficult to understand the consumers’ taste in order to make them have a better life. Therefore, the company was enrolled in a learning process to improve its products every year, so as to be more efficient than the previous years. The learning process was done in many steps. First, the company attempted to know the new consumers’ needs especially in those far regions such as China and Eastern Europe.

Second, the company compares between the different ideas and experiences, which they take from customers of different countries. For example, laundry and hair care needs differ from one country to another. Third, the company continues in establishing new products and implements the useful ideas that they attain. For example, the company benefits from producing various kinds of food by using their wastes in manufacturing soap and candle. By this way, our company develops its goods to be one of the extremely strongest companies in our globe.

In addition, the company followed some steps, which with their aids it became more successful. The first step was to make new needed products, and this was achieved by using high technological machinery. The second one was to continue in producing the successful products with suitable quantities, so as not to be negatively affected by its competitors of the same market. For instance, in laundry and cleaning products ‘Tide’, a strong product which the company is concerned with selling certain amounts of it daily, must be produced with the limited quantities it was planned for.

Besides that, the third step is to have more capital investments to enlarge the company in the future. This step would not be accomplished perfectly, if the company did not depend on making useful research, as well as, the laboratory testing, which consequently leads to beneficial results. Actually, these three strategies enabled our organization to be outstanding in the global market and to preserve its success. Procter and Gamble is a multinational corporation with 156 branches distributed in more than 70 countries.

Osama Abdel Rahman, sales manager of Procter and Gamble in Egypt believes that it should be called a “location” instead of a branch. This ‘location’ in Egypt gets technical and managerial assistance from the Mother Company. As for the assistance that Procter and Gamble in Egypt gets from the Mother Company, Mr. Abdel Rahman says that “we get support regarding product development and market research from the head quarters in the U. S and Europe. Very little research and development is done here, in Egypt, because it needs high investments and manpower”(Personal Interview).

There are three main development centers for Procter and Gamble. The first center is in Germany and it is responsible for developing paper products like ‘Always’ and ‘Pampers’. The second development center, which is in Brussels, is responsible for detergents. The last center is located in the United Kingdom and it is responsible for soap and shampoo. Those three centers do all the market research for international companies, like the one in Egypt. They study the needs of the market and make the formulas for the products. Then the formulas are sent to Egypt where the products are produced.

Another form of assistance, that the location in Egypt gets from the mother company, is that some of the staff members who work at the location in Egypt, travel to the U. K to get training in order to improve their performance. Moreover, the quality standards are set by the head quarters in the U. K, then sent to the location in Egypt to be follow. As to prices, in Egypt, they are higher when compared to the prices of Procter and Gamble products in the U. S and Europe. This is because that “85% of the raw materials are imported” as Mr. Abdel Rahman points out (Personal Interview).

Therefore, the location of Procter and Gamble in Egypt has to pay tariffs and other custom taxes, which make the costs of production as well as operations higher, as a result the prices have to be, in turn, higher. Concerning the profit made by the location in Egypt, Mr. Abdel Rahman notes that “no percentage of the profit we make goes to the Mother Company, we keep all the profit. ” (Personal Interview). Procter and Gamble environmental science department plays a unique role in making excessive tests on their products to ensure that they are safe for the consumer and for the environment.

Environmental safety is an integrated parts of the quality that P&G builds into each of its products throughout the world. P&G environmental quality policies are considered to be very important as they been using detergents with less amounts of water and energy i. e. , the amounts of raw materials used in the manufacturing process and thus saving the environment resources. And according to some statistics made in 1992, it was revealed that the detergents used in Tide, Ariel, Era, Cheer, Gain, Dreft and Ivory shows that water used by less by twenty percent of all pervious years. Also, P&G were keen to save the paper industry.

For instance, in 1992 products like Bounty, Folgers, Zest and Hawaiian Punch have reduced their packaging process from ten to twenty percent compared to 1994 (Environmental Initiatives And Program). Procter and Gamble company is committed to producing superior quality of goods and to producing products to refine the world’s consumers. Some of the obligations that P&G is committed to, is to ensure that the products, packaging and operations are safe for both the employees and the environment. Also, ensuring that the products can be disposed easily in an appreciate manner(Enviromental Quality).

Also, they are committed to meeting or exceeding the requirements of all environmental laws and regulations. P&G is a well known leader for implementing the environmental safety, refilling packages and recycle plastic in order to have a clean environment. Sadly, the P&G company is not following the rules, as it should be. Despite Procter and Gamble promises and reputable name, each year thousands of animals are the victims of the painful products tests, due to the massive doses of compounds and the irritating substances they experiment on their shaved abraded skin.

Also, they force animals to inhale and swallow enormous amounts of compounds. And to make the things worse, the industry of toxicologists had stated that, their results could not be reliable since there are huge physiological differences. The stressful laboratory conditions impair the immune function and alter heart and pulse rates of animals. The company’s actual performance could be deduced by looking at its 1998 Annual Report.

Its worldwide net earnings for the year 1998 were 3. 8 billion dollar, which is 11% increase over the prior year and $37. illion net sales accounting for a 4% increase over the prior year. It has total assets of $30. 9 billion and liabilities of $5. 7 billion. It’s obviously clear that the company is taking good care of its products because its expenses in advertising and the research and development of the goods are $2. 6 and $1. 56 billion respectively. This is an evidence of how much consumers demand our products and how this initiates the company to develop 300 brands to satisfy five billion consumers all over the world.

Big Oil in the Arctic

It can be argued (convincingly) that human’s usage of fossil fuels is responsible for a large part of the world’s pollution problems. The area that I will discuss is the interaction that the big oil companies have had with the environment surrounding their businesses in Alaska. I will not tackle the issue of whether it is right or wrong to extract or use fossil fuels. Instead, I will ignore the larger issue and concentrate on specific issues concerning the Arctic Slope activities of oil companies in Alaska.

Because the North Slope oil fields are on American soil, the regulation of the industrial activities is far more stringent than other areas in the world. If we compared the North Slope oil business with places such as the Alang ship-wrecking yards in India, we would be talking about a whole different level of environmental pollution, work safety, and the rights of native peoples. However, the same ethical principles can still be applied to the business activities of the big oil companies that operate on Alaska’s North Slope.

First, the Arctic Slope Natives have the right to property, right to unspoiled environment, and negative right to be free from all the influences that change their cultural practices. All the natives of the North Slope (Inupiat Eskimos) have experienced an extremely large increase in their material wealth because of the taxes, royalties, and new business opportunities that they receive as a result of the oil companies presence in the Arctic. Because of this, the majority of the natives in the area welcome the presence of these companies.

They still treasure the natural environment around them, but they don’t see any immediate harm being inflicted on the land in which they have lived for hundreds of years. With the large influx of wealth into their lives, the Inupiat people might be blinded by their material comfort and might not see the larger picture of the damage that is being done to their land and to their culture. Second, the wildlife of the Arctic have had its right of habitat infringed upon. However, we have not seemed to be adversely affected by the presence of oil companies.

The number of animals has cycled up and down, but the entire numbers of most species have increased since exploration and drilling began. Third, the citizens of the state of Alaska are being coerced into voicing a favorable opinion of oil companies because their jobs depend on the presence of these companies. The majority of the citizens are in favor of oil companies and want them to stay in Alaska. The reason for this is that the economy of the state depends greatly on the oil industry. When the industry does well, the citizens of the state feel the direct results.

It’s easy to see why most Alaskans are in favor of oil development, because oil is what pays their bills. Finally, the businesses in the Arctic oil industry feel that they are being completely ethical in their business dealings. I concentrated on the BP Amoco company because it is by far the largest oil company in the Arctic and therefore sets the standard for the smaller companies that rely on it for business. BP has complied with all the environmental regulations and has funded many independent and state studies concerning the affect that the oil industry has had on the environment.

BP has also funded many activities that benefit the people of the Arctic and entire the state, such as roads and education. Native People of the Arctic The Eskimos of the North Slope Borough have a right to property. Governments bought and sold the state of Alaska and ignored the people that had lived there for hundreds of years and who were the true owners of the land. When oil was discovered on their land, the Natives of the North Slope weren’t recognized by the oil companies as the true owners of the rich land. The North Slope Borough is approximately the size of Minnesota.

It covers almost 90,000 square miles from the Brooks Range of mountains to the south, to the Beaufort Sea to the north. It stretches from the Chukchi Sea on their western coast to the Canadian border on their eastern boundary. Contained within this area are seven Inupiat Eskimo villages and one village of Nunamiut Eskimos. The Inupiat Eskimos are people who depend mostly on the sea for their subsistence needs. They hunt polar bears, seals, walrus and whale as well as caribou and various birds. The Nunamiut people are Inland Eskimos and depend more on caribou and Dahl sheep for their subsistence needs.

All their people have traditionally traded and bartered together. The population of the North Slope is about seven thousand permanent residents, not counting Prudhoe Bay, which is not a permanent settlement but an industrial site. The native villages range in size from about 4000 in Barrow, the seat of municipal government, to 250 in their smallest village. When the Alaska Native Claims Settlement Act passed in 1971, the Inupiat people of the Arctic Slope wanted President Nixon to veto it. Billions of barrels of oil had been discovered at Prudhoe Bay on the North Slope, but the act gave them not a drop.

Their people had roamed 88,000 square miles of Arctic Slope country for centuries, but the act gave them just a tenth of that land. We wanted all of it, said Joe Upicksoun, an Inupiat Eskimo leader in the land-claims battle on the Slope. More than a quarter century later, the company they started, Arctic Slope Regional Corp. , is the largest Alaska-owned company, with revenues in 1997 of $661 million.

Arctic Slope’s subsidiaries have multi-million dollar contracts doing oil field work for Arco Alaska Inc. , BP Exploration (Alaska) Inc. d Alyeska Pipeline Service Co. The corporation has refineries and fuel distribution companies, a fabrication yard that makes giant oil processing facilities, a plastics plant and other businesses in the Lower 48. In the last year the corporation began laying the groundwork to enter the oil field services business in Venezuela and Russia. Not only was Arctic Slope denied ownership of the rich Prudhoe Bay oil fields, company managers found it difficult in the early years to get a significant share of the work there.

We weren’t part of the good old boys that generally do business with the oil industry, Leavitt said. Arctic Slope Natives also have a right to an unspoiled environment. With big industrial equipment comes a pollution that this area has never seen. The Arctic has yet to produce profound evidence that industrial activity has had a negative affect on it, but it is nave to think that a land as pristine as the Arctic Slope will be unaffected by large industrial activity. Tensions arose between the industry and the Inupiat people for several reasons.

In those early years Arctic Slope Natives feared the industry would hurt the natural environment they depended on for food, Arctic Slope’s President Jacob Adams said. Ben Nageak, the North Slope Borough mayor in 1998 believes that big oil is good for his people: “Our Elders were fearful that our culture would not survive if the land on which we subsisted was spoiled. They thought the caribou would leave and never come back. They thought the birds would nest somewhere else. They feared they would be the last people to practice the Inupiat subsistence way of life.

They did not want their way of life to die. It’s now more than 25 years later, and our worst fears were never realized. The oil industry made a concerted effort to cooperate with the Inupiat people in addressing their concerns. They listened to us. Together, we have refined practices and rules for safe development. Today, the oil industry is no longer seen as an adversary by the Inupiat people. It is now viewed as a partner. And our Inupiat culture is still alive and thriving. ”

The mayor of this borough does not misrepresent the views of his people. The Inupiat Eskimos of this region have all gotten extremely wealthy as a result of big oil companies. They have been able to have their own high school, and install safe water and sanitary sewage disposal systems. While the natives may squabble with companies such as BP, they do not want big oil to leave the Arctic. In fact, a majority even want the major companies to keep exploring on such controversial sites as the Arctic National Wildlife Reserve (ANWR).

Because of their healthy, and mutually profitable relationships with the people of the Arctic region and around the state, companies such as BP are catered to by most of the citizens of the entire state. With the natives’ first-hand view of this issue, it can be argued that they are in a better position to judge the impact of the oil companies. However, their views can also be distorted by the amount of money flowing into their pockets. They criticize environmentalists who they believe don’t understand the situation because they are so far removed from the actual land.

This brings us to the question of whether the natives of the North Slope really have an unbiased view of oil drilling in the Arctic. They believe that they were wronged because they only ended up with legal rights to a fraction of the land that they had inhabited for centuries. However, they are not upset about the oil exploration that occurred and is still going on, but they are upset that they don’t get all the royalties from the land use. They will not argue about how their cultural identity is fading away, or how industrial activity will impact the environment in their once pristine land.

In their eyes, the benefits of having big oil companies drilling on their land far outweigh the costs to their culture and environment. Better education, improved housing and community infrastructure, greater life expectancy, and security against widespread hunger and many forms of once deadly diseases are some of the benefits Natives have received from their increased wealth. However, because of oil companies and the wealth that came with them, the Natives of this region face social and behavioral health problems that threaten the future existence of the unique cultures on which healthy lifestyles were once based.

Alcohol abuse and violence running rampant in Alaska Native society have disheveled family and village life. Cultural values and morals that in the past provided clear instruction to tribal members and assured the social order of communities have been seriously eroded and, in some instances, virtually lost. However, the Natives don’t see a way around this cultural erosion, and if they blame oil companies then they don’t show it. Regardless of the Natives’ opinions, their rights are still being violated.

The workers at the Alang ship-wrecking yards were happy for the work they had and the meager wages they were being paid, but a slew of their rights were being violated. A group of people, such as the Arctic slope natives can be in favor of activities and still have their rights (unspoiled environment) violated. Wildlife The right of habitat for the wildlife in the Arctic has been infringed upon to a degree by the oil companies. The problem with this argument is that the oil companies can offer proof that the wildlife in the area hasn’t really suffered by the loss of parts of its habitat.

The Central Arctic Herd (caribou), which uses the area around Prudhoe Bay, has tripled in population since oil development started in the early 1970s. There are four major caribou herds in northern Alaska. Besides the Porcupine and Central Arctic herds, there is the Western Arctic Herd, which is more than twice the size of the Porcupine Herd, and the smaller Teshekpuk Lake herd. Populations of these herds rise and fall by natural cycles. Three decades of oil and gas activity in the central North Slope has had no apparent negative impacts. The U.

S. Environmental Protection Agency (EPA) states, “The addition of new exploration, development, and production activities will increase human activity and the likelihood of polar bear sightings. We do not believe that the overall activity level will have a measurable impact on polar bears during the 3-year period (03/30/00 to 03/30/03) covered by these regulations. ” Again, though there hasn’t been a lot of evidence concerning the negative impacts of industrial activity, but the activity can’t possibly be helpful to the wildlife of the Arctic.

The Citizens of Alaska The citizens of Alaska are being coerced, in a way, by big oil companies to support the destruction of the environment on the Arctic Slope. BP/Amoco has taken care of the citizens of Alaska the same way it has taken care of the native peoples in the Arctic: with money. The oil industry is what keeps many Alaskans employed. Every Alaskan knows that oil is crucial to the economy of the state, whether they like it or not, and they aren’t about to give up the money from this industry.

Alaskans demonstrated their support for the oil industry when the state’s delegation to last summer’s Democratic National Convention threatened to prevent a unanimous nomination unless Mr. Gore at least listened to their concerns about his opposition to oil production in the Arctic National Wildlife Refuge. Even though the state normally votes heavily Republican in national elections (all three congressmen are Republican), Democrat Tony Knowles was swept into a second consecutive term as governor on the strength of his pro-development, pro-business first-term record.

In this case, the voters demonstrated that party affiliation is less important than a candidate’s support for Alaskan economic development. The residents of Alaska generally feel that the oil companies are not infringing on any rights of the average citizens of Alaska. These people can live without the oil companies, although probably not comfortably, and definitely not in Alaska. So they are generally happy to see the oil companies making money because that means the citizens are also making money. The companies have worked with Alaskans to get a favorable reputation in the state.

They have funded a majority of the state government, which in turn provides roads, education, and protection. Alaskans feel that if they listen to their conscience and get rid of these companies, then they will lose their job and Alaska won’t have a way to support all the programs that the companies provided. The Business View I will take the side of the oil companies, specifically BP Amoco (since it is the largest oil company in Alaska) and express with my business background why they (the companies) think they are doing ethical business.

Several studies mentioned throughout this paper have shown that the impact of development in the Arctic, specifically Prudhoe Bay, has not been shown to have an adverse effect on the wildlife, the people, or the environment. Early design and permit requirements of the North Slope facilities included such precautions as providing caribou crossing ramps over pipelines, avoiding sensitive habitats during construction of gravel roads and pads, and long-term monitoring of caribou, birds and other Arctic wildlife species.

Exploration activities take place during the winter and use temporary roads made of ice, instead of permanent gravel roads, in order to avoid damage to the tundra ecosystems. Ice access roads are also laid alongside pipelines during their construction and maintenance. If travel over the tundra is unavoidable during the summer, BP uses special vehicles, referred to as ‘rolligon’ vehicles, which exert minimal pressure on vegetation. Pipelines are elevated on vertical supports to allow caribou herds to roam unhindered through the oil fields.

Improved drilling technology has further reduced the need to build on the tundra of the North Slope. Directional drilling allows wells to be spaced more tightly on gravel well pads, and reinjecting drilling muds and cuttings materials into depleted oil reservoirs eliminates well pad reserve pits. This, and the more vertical design of building facilities, have reduced the surface space occupied by gravel by up to 70 per cent on the North Slope. BP continues to develop other environment-protecting innovations such as the multi-year ice pad used in 1994 for exploratory drilling at the Yukon Gold site.

BP also funds continuous wildlife and vegetation monitoring by independent survey organizations. The population size, behavior patterns, body condition, distribution and other factors affecting many species are studied every year. Caribou, Arctic foxes, and polar and grizzly bears are monitored, as are the migration patterns and numbers of offshore fish species. Snow geese, swans and brant are among the many bird species assessed. These studies indicate that the plants and animals of North Slope ecosystems have continued to thrive since production began.

BP says that environmental protection and employee protection are the two main corporate priorities. This is reflected in the environmental training and updates required for all employees. Strict no-spill policies are enforced for contractors as well as BP employees, and all spills must be reported immediately. Environmental response teams participate in weekly spill drills and every year a major Mutual Aid Drill is conducted by BP, and Alyeska, the company responsible for transporting the oil.

BP believes that it can manage environmental liability effectively and reduce costs, by following a long-term strategy that focuses on minimizing risk, managing transaction costs and increasing credibility. The problem is that BP’s environmental protection priority does not include the pollution that all of its industrial activity is causing. BP’s believes its good reputation is indicated by cooperative permitting processes and support from the Inupiat government agency. It has also been recognized by several international and national awards.

These include the International Stratospheric Ozone Protection Award, presented in 1992 by the US Environmental Protection Agency, and the US Department of Interior Certificate of Appreciation, presented to the Anchorage and North Slope Environmental Departments for outstanding voluntary contributions to the nation. Conclusion The oil companies of the Arctic North Slope have infringed on the right to property, the right to an unspoiled environment, and the right not to have interference in a very traditional culture of the Arctic North Slope Natives.

The right to habitat of the wildlife in the Arctic North Slope is also being violated by the big oil companies. The citizens of Alaska are being coerced into fighting for the oil companies because their livelihood depends on it. The oil companies, especially BP Amoco, can seem like they are an ethical because of all the good things that come from the oil money, and because of how much they contribute to the community. They can give evidence to back up the fact that apparently their production in the Arctic has not had a negative impact on the environment. From the philosophical side, I think big oil has violated the rights of various groups.

From the business side, I think it would be hard to argue that oil companies in the Arctic could be doing anything better than what they are currently doing, apart from finding a different industry. From the perspective of an Alaskan Native, I think the companies need to be restrained so that they try even harder to become safer to the environment around them. They would trash the whole Arctic if nobody could do anything to stop them making a profit. But most of my friends, my family, and my native corporation depend on oil in various ways, and that may make us wish for (guiltily) big oil to keep prospering.

Analysis of Bombardier

Bombardier took on its present form in 1976 when MLW-Worthington, a manufacturer of locomotives, acquired Bombardier Ltd. , a manufacturer of snow tractors and snowmobiles. The company was renamed Bombardier Inc. in 1978. The company has been active ever since in the acquisitions of various aerospace and transportation companies around the world. Nature of the Business Bombardier conducts business in five main areas: transportation equipment, aerospace, defense, motorized consumer products, and in financial and real estate services.

The total revenues increased by 20% from $5. illion to $7. 1 billion over the last year. To be able to see the extent of Bombardier’s operations it is best to look at each manufacturing group separately. Aerospace Aerospace is Bombardier’s most important industry. It accounted for 47% of sales and 33% of profit in 1995 and makes Bombardier the fourth largest civilian airplane manufacturer in the world. Bombardier’s customers are spread out over the globe. They range from government and private commercial airlines to wealthy individuals and corporations in need of private jets.

The products hat are driving the growth in this division are the RJ, the Global Express, and the Lear-45. De Havilland, which was recently purchased with help from the Ontario government, produces the Dash-8 series of airplanes. The Dash-8 has had its production rate increased to 48 planes a year with about 81 on order. Modified versions of the Dash-8 are in the works that could enable an even bigger increase in production. Bombardier has cut costs and increased the profit margin at de Havilland to improve profitability.

Bombardier will likely exercise the option to buy the remaining 49% from the Ontario government. The utlook for the success of the RJ is very good, although most of its sales rely on a small number of companies, these companies are pleased with the RJ’s performance to date. Bombardier’s entrant into the long-range market is the Global Express that has about 60 orders on the table, but needs 100 to break even at a price of $34 million. It is experiencing strong competition from Gulfstream, which produces a plane that is targeted for the same market as the Global Express.

Bombardier has been successful in turning around the troubled Learjet operations and now expects Learjet to expand its aircraft production ith the introduction of the Lear-45, which already has 90 orders on hand. The Canadair 50 seat regional jets are continuing to be turned out at a rate of 60 per year. Overall the Aerospace industry has strong growth potential, provided that Bombardier sticks to its successful niche marketing strategy. Bombardier is competing with some of the biggest companies in the world. Boeing, McDonnell Douglas, Lockheed Martin, and Raytheon are all counted as the opposition.

Transportation Equipment This industry is responsible for 22% of sales and 22% of profits for 1995. The nature of this group is cyclical. Bombardier manufactures subway cars, high speed trains, passenger cars, and a variety of other equipment, which is primarily sold in the North American and European markets. Bombardier has made many acquisitions in this industry that are usually acquired at a loss. These acquisitions along with the huge loss in the Eurotunnel contract has made it difficult for Bombardier to show it’s real profitability in this industry. Revenues have increased by 20% since 1994.

Bombardier has 28% and 12% of the North American and European markets respectfully. The outlook for expansion in he North American market is encouraging with the contract with Am-Trac to supply high-speed trains and equipment for use in the United States. Recent developments in Mexico has led to an increase in demand for railway cars in that country. As well, the acquisition of Waggonfabrik Talbot will give Bombardier a strong foothold in the European market that already accounts for 60% of sales. One area of concern is that Bombardier’s competitors in this industry are becoming stronger.

The merger between Asea Brown Boveri (ABB) and Damhler-Benz has created a strong competitor. The reemergence of Morrison Kundsen has also increases the competition in this area. The fact that more and more transportation authorities are being privatized and will need to adapt their fleets to meet consumer preferences creates a positive outlook. To accomplish these adaptations these companies will have to renew their 1000’s of vehicles. Motorized Consumer Products. The biggest products in this group are the Sea-Doo and Ski-Doo recreation vehicles. This group accounted for 23% of sales and 38% of profit.

High profit margins have helped Bombardier achieve success in this market. Sales in the Sea-Doo area have increased by 20% last summer making Sea-Doo the leader in the personal water craft market. The increase in Ski-Doo’s sales has been about 8% per year over the last few years giving Bombardier the number two position in the market behind Polaris. Other competitors in this group are Arctic Cat and Brunswick. Bombardier has also recently expanded into electric vehicles marketed to closed gate communities in the southern US mainly occupied by seniors.

The markets for personal recreation vehicles is cyclical, but the trong economy in North America right now is helping to buoy sales. A problem on the horizon for Bombardier is that the aging demographics of its market may mean a fall in purchases in the future. Defense Defense accounted for 6% of sales and -2% of profit. The major products in this group are the Starstreak missile, Shorts Missile Systems, and various support services. Customers are mainly governments in the UK, US, Middle East, France, and Canada. Bombardier has seen the demand for its products in this market shrink over the past few years.

Efforts are being made to outsource roduction and carry over technology from defense to civilian uses. The major competitors in this market are the same as in the aerospace industry as well as Loral and Rockwell. Financial Services 2% of sales and 9% of profit was contributed to this group. Bombardier deals in three main areas. It gives loans and leases to dealers of its own products and other dealers, it provides leasing and financing to its customers, and it provides financing and support for Bombardiers other divisions. There are really no competitors because Bombardier knows it’s own business better than nyone else.

The major banks may provide some competition in areas of customer financing. The success of this division depends on the successes of the other groups. Management Quality Bombardier management has acquired a very good reputation for turning around failing businesses. Bombardier management has been able to see opportunities and take advantage of them. The ability to turn around businesses, strong stability, strategic vision and good returns to shareholders in the past have displayed that the Bombardier management is, at the least, of good quality.

Ownership Control here are a total of 335,505,211 common shares. 88,756,982 of these shares are Class A, which have voting rights of 10 votes each. The other 246,748,229 shares are Class B with 1 vote each. The Class B shares can be converted to Class A shares under special situations. There are 1,236,900 cumulative, non-voting preferred shares totaling 30. 9 million dollars. The dividends received from these shares are either 75% of prime or 1. 875%, which ever is greater. Family members of the founder, J. Armand Bombardier, some of which are management own about 62% of the voting shares.

Napster – Virtual Music Forum

Napster: (http://www. Napster. com) is a company that operates exclusively online as a virtual music forum. Napster not only allows its visitors the ability to participate in ongoing discussions through its message board forums and online virtual chat rooms, but it also allows its visitors the capability to exchange music files (MP3s) with other Internet users. Because Napster is a “virtual” online public forum, Napster should be protected under the First Amendment. Under the First Amendment, “we the people,” are protected by these rights of freedom of speech and assembly.

The idea of people coming together in one specific area of the Internet and being able to talk about music is essentially a right of all Americans. We have the right to “freedom of assembly” and the right to “freedom of speech. ” This is why Napster should not be shut down. Napster should be protected under the First Amendment. What is a Napster? Shawn Fanning was a nineteen-year-old college student at Northeast University, when he first introduced his program Napster. Fanning had two loves: one was sports and the other was computers. As his curiosity grew for computers, he decided to stop playing sports.

He then concentrated most of his time working with computers. He primarily focused on two aspects of the computer, programming and the Internet. During his freshman year at Northeast University, in 1998, Fanning was trying to enter computer science classes higher than the entry level (Jones, 2001, 1A). Not finding anything challenging about the courses he was enrolled in, Fanning decided to start writing a Windows based program in his spare time. He spent most of his time in chat rooms with experienced programmers who knew the tricks of the trade, so to speak, of computer networking.

Shawns roommate loved music files, most commonly known as MP3s, but disliked most music sites that had limited music files available. He also disliked the idea of having to search endlessly from website to website for songs. Fanning, having this in mind, and his programming skills at hand, he wrote a program that he entitled Napster. He used the idea of all users being connected to one central computer server, and having access to each others music files that users wished to share (MTV News, 2000, 1). Spoken in a more technical manner Napster makes its application software freely available for download by consumers from its website.

This software allows users to connect their PCs to and participate in the Napster peer-to-peer file indexing system. Users are not required to share any files with others, either as a condition of using the Napster system or in order to obtain files from other users (Reuters, 1999). In short, Napster is a facilitator that allows its users to trade music files. Fanning created it because other music-trading sites were in his view, unreliable. The idea of program sharing MP3s and giving people the ability to make customized compilation CDs (also known as burning a CD) of their favorite artists.

Songs may sound brilliant to the users of Napster, but to the musicians whom creatively write the music, this is in their view, is a form of stealing. They have not only spent hours producing and writing music, but music is something that is published and copy-written. The Recording Industry Association of America (RIAA) is currently representing the band Metallica, rapper Dr. Dre, and five other major record labels, which are all plaintiffs in a copyright infringement and piracy lawsuit against Napster (Reuters, 1999).

When the Napster software is downloaded on a computer hard drive, Napter serves as an online music community, where you can conduct a search of the other users songs (MP3 files) that are currently online. According to Fanning, There are consistently eight hundred thousand people using the Napster service, limited only by their resources (MTV News, 2001, 1). This statement is the exact argument that the RIAA is using to sue Napster. On May 8, 2000, the RIAA sued Napster for copyright infringement (Heilemann, 2000, 1-2).

In their opinion they feel that there are over eight hundred thousand people stealing music at any given time. The RIAA believes that Napster and its founders are promoting the illegal reproduction of copyrighted music, and not giving any royalties to the owners of the songs (Reuters, 1999). Their theory behind the lawsuit is that there is no reason for a lover of music to go out and buy a compact disc that they like, why would a person want to buy a CD, when they could get it for free? They belief that Napster should be shut down until it compensates the artists for lost revenues for copyrighted music that was stolen.

There is not a First Amendment right to take someone elses copyrighted expression and duplicate it (Freedom Forum Staff, 2000,1). On the flip side, Napster believes that shutting their company down is in violation of 1008 of the Audio Home Recording Act (AHRA), which immunizes all noncommercial consumer copying of music in digital or analog form (Reuters, 1999). This basically means that since Napster is not profiting off of the music, and the sharing of music is intended for the soul purpose of the noncommercial consumer usage, therefore, it is protected by the AHRA.

According to Napsters newsletters, as a condition to your account with Napster, you agree that you will not use the Napster service to infringe the intellectual property rights of others in any way (Earp, 2001, 1). Napster believes that they are just the facilitators in an online exchange forum. Napster is the program that links computers together, not the program that steals music. They contest that they have done nothing wrong and that they shall not be shut down by a court of law. As to this day, the litigation between the two parties (RIAA and Napster) still has not been fully resolved.

The CEO of Napster, Hank Barry, and Andrea Schmidt, the executive at Bertlesmann, (one of the world biggest media conglomerates and a plaintiff) went to the zoo one day and as odd as this may sound, “during a critical point in their eight-week-long secret negotiations” about the current lawsuit that Napster was involved in. They were looking at the exhibit with Lily the polar bear, all of a sudden, “to their horror, Lily shot out a paw and savagely crushed the bird. The metaphors presented themselves immediately. “I don’t want Napster to end up like that pigeon,” Barry recalls saying” (Stone, 2000, 1).

Napster is taking this lawsuit very seriously and is throwing everything in its arsenal to stop the destruction of itself. They are presenting statistics that strengthen their power, for example “in the past year, the recording industry has posted a ten percent increase in album sales” (Earp, 2001, 2). They claim that there is an increase in CD sales despite the fact that Napster still exists. Napster is not hurting the music industry, in fact they believe it is helping them, so why bother shutting the program down. Shutting down Napster is the crime that will be committed; Napster is not the one committing the crime.

The current lawsuit that is still pending between Napster and the RIAA is should not be considered in the argument that Napster should be protected by the First Amendment; the lawsuit is irrelevant to my argument. I believe that Napster should be protected under the First Amendment. Napster is a virtual public forum. In this forum people assemble together, they talk about music, read about music, and most importantly they trade music. This idea brings up the point that Napster and its users have the right to assemble, and have the freedom of speech to talk about music.

If the courts send down a decision in favor of the plaintiffs, the court is essentially contradicting a right that has been instilled in this country ever since it was formed. It will be contradicting a right that was the main reason for the foundation of this country, the freedom of speech. Americans have the freedom of speech. Napster users also have this freedom. In order to implement the District Courts order, Napster would be forced to terminate is Internet directory, despite the fact that the directory serves numerous lawful purposes.

Napster has the First Amendment rights to publish a directory, Napster users have First Amendment rights to have access to such a directory (Reuters, 1999). This statement explicitly states that Napster and its users have the First amendment right to use Napster. In this program thousand of people assemble together at one time to talk about music and trade music. If Napster is shut down, the courts will be infringing on the First Amendment rights of Napster and its users. In concern to the lawsuit, the RIAA is suing Napster for copyright infringement.

They are suing for copyright infringement because Napster users are trading music and then burning the music onto CDs without ever having to buy them. Napster has presented a proposal that it would charge a flat one-time fee for the use of Napster (MTV News, 2001, 2). The idea of having to pay for a service may not leave a good taste in some users mouths, but on the other hand, some local users of Napster say they would be interested in subscribing to the popular music-file-sharing Web site if an appellate court shuts down the free service (McWilliams, 2001, 1A).

The idea of having to pay or not to use the service is irrelevant to the argument, but if having to pay the artists is the only thing that is going to keep Napster alive and to stop the government from crushing their First Amendment rights, then the act of paying should be enforced, and both side will be satisfied. In conclusion, Napster should be protected under the First Amendment. Napster is a public forum where people can get together to talk to each other and trade music files.

The First Amendment clearly states Congress shall make no law abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble (Bill of Rights). These are the rights that Napster and its users all have, for they are members of the United States. Regardless of the current lawsuit about copyrights that is still pending, or whether or not the users of Napster should have to pay for the services, Napster should be protected under the First Amendment.

Reverse logistics as an integral part of Supply Chain Management

Most of us think of logistics as a one-way street. Products are manufactured, packaged, stored in a warehouse, sold, and then shipped off to the customer … end of story. Yet for many logistics managers today, that’s not the end of the story. In addition to managing outbound goods, they also are responsible for reverse logistics–the flow of returned goods and packaging, including customer service and final disposition of returned items. The need to manage waste materials and returned goods is growing in all kinds of industries.

Today, companies like Xerox, Eastman Kodak, Mobil, Home Depot, and Ethan Allen Furniture – to name just a few – have recycling programs that meet the needs of their individual industries. There are many reasons for the explosive growth of what’s come to be known as “reverse logistics” over the past five years or so. The most prominent is increasing public awareness of the social costs of excess waste. A large-scale recycling program, therefore, generates goodwill among consumers and industrial customers.

As support for recycling grows, moreover, companies want to be perceived as good citizens that are committed to protecting the environment. Another important reason is the need to control costs. Frequently, manufacturers treat recovery of products and packaging as an afterthought. A well-managed reverse-logistics program, however, can bring enormous savings in inventory-carrying, transportation, and waste-disposal costs. For these and other reasons, more and more companies are launching reverse-logistics programs today.

Unfortunately, it’s often assumed that reverse logistics is simply a matter of reversing the outbound distribution process. In fact, recycling and returns management have their own unique and complex issues that affect logistics operations. A brief overview of those issues highlights the five main areas you should consider before starting a reverse-logistics program. A related issue is what kind of resources you are willing to commit to a reverse-logistics program. The obvious answer is that the level of potential benefits will influence how much a company will invest in such a program.

Too often, though, companies shortchange themselves by failing to devote sufficient time, money, and personnel to the project. “A lot of times, [reverse logistics] becomes a side job for somebody. It’s not their focus or a high priority,” says Cindie Vaughan, supervisor of reverse logistics for Consolidated Freightways. If no one is proactively managing the process, it’s bound to result in higher costs and missed opportunities for savings and profits. A solution for many companies that have limited resources for reverse logistics is outsourcing that function to third parties or transportation companies.

It’s up to the shipper, though, to examine the cost and service benefits, then decide how much of the process should be outsourced. “As with any outsourcing decision, it’s a matter of being able to focus on your core competencies and freeing up your people to work on products rather than expend your assets on [reverse logistics],” suggests Brett Chyatte, senior marketing specialist for reverse logistics at Federal Express. The primary components of the reverse-logistics operation are retrieval, transportation, and disposition. The retrieval stage deals with where the waste or products should be picked up and by whom.

Much depends on the nature of the item being returned; if it’s clothing, for example, a carrier can handle all of the pickup and documentation tasks at the consumer’s door. If, on the other hand, the items are oversized, heavy, hazardous, or very delicate, special training may be necessary for both customers and carriers. Burnham, for example, dismantles photocopiers for several customers that sell or lease the reconditioned machines. Drivers are trained to remove internal components that could cause damage in transit, protect glass, secure all moving parts, and pack them for transportation.

Hazardous materials, meanwhile, must be flawlessly handled, but field locations and distributors may not have the necessary expertise. Michael LeMirande, business development manager for Redwood Systems, says he often tutors auto dealers in how to manage returns of such items as engines and transmissions. The battery and most fluids in automobiles are classified as hazardous, so there are specific procedures for preparing them for transportation, he says. A company that does not control the transportation of returns is asking for trouble, says consultant Ken Miller of Gardner, Mass.

Most often, the manufacturer pays the freight for returned goods. “Yet typically the customer estimates the weight, guesses at the bill-of-lading description, and routes the shipment via a carrier that has no pricing agreement in place with the manufacturer,” he says. As a result, incorrect weights and product classifications can lead to “$500 bills that should have been $50. ” To prevent thousands of dollars in excess freight charges, Miller suggests that shippers provide the carrier routing, correct weight, description, and class to customers when they call for a return authorization.

Better yet, he says, customer-service representatives could complete the bill of lading for the customer showing all three of those items. The biggest questions related to product disposition are whether to handle returns in centralized or regional facilities and how incoming shipments should be processed. The answer depends on the type of product and what will happen to it after it is returned. More and more shippers are opting for centralized returns processing because it increases their control over a product’s life cycle and allows for better data collection.

That is especially true for manufacturers of high-value goods with short shelf lives, such as computers and telecommunications equipment that need to be repaired and sold as quickly as possible, notes FedEx’s Chyatte. It also creates opportunities for shipment consolidations, which can reduce transportation costs and ensure better utilization of reusable containers and other equipment. Centralized returns-processing also helps shippers document returned products that are exported to secondary markets overseas, supporting claims for duty refunds under U. S. Customs’ duty-drawback program, adds “Buzzy” Wyland, executive vice president of GENCO Distribution System.

A successful reverse-logistics program depends heavily on gathering meaningful information that can help manage the returns process while tracking costs, says Wyland. “You want software that will facilitate the smooth, efficient backflow of product from the customer-service desk all the way to the final disposition,” he says. Too often, companies add the information component at the end onto a finished program, which can create bottlenecks and inefficiencies, he notes.

What’s important is not to wait until you have a pile of returned stuff. You have to plan for it upstream and build the software into the system. ” The Internet is becoming an effective tool for gathering and disseminating information in a reverse-logistics environment. Federal Express, for example, has developed a returns-management system called “NetReturn” that relies on the Internet to capture customer information, schedule pick. ups, arrange transportation, and track the status of returned goods. All the customer has to do is call the merchant and request a return authorization.

Once the shipper transmits the shipment details, the information system takes over. It even prompts the merchant to follow up when items are not picked up as scheduled. The tax, finance, and credit implications of the program is an area that may not be very visible to logistics managers, but it is one of the primary reasons upper management will support a reverse-logistics program. The act of returning goods sets off a flurry of finance-related activities, including issuing refunds and credits, accounting for inventory costs, and tracking tax liabilities.

Logistics can help make those activities easier and more accurate by collecting and providing the necessary information. For example, retailers and manufacturers traditionally have clashed over the issue of credits and refunds for returned products, says Wyland. “Retailers sent back a product and deducted for what they sent back from their payments. For manufacturers, it was an annual nightmare trying to reconcile the physical product with the paperwork,” he says. Now, with the proper information gathering and dissemination, manufacturers can immediately reconcile their customers’ claims.

There are enormous financial benefits to managing returns this way, Wyland says. “Before, manufacturers didn’t know their profitability until they reconciled at the end of the year. ” Now, they don’t have to carry unreconciled claims and they don’t have to build cash reserves to cover those claims. “The net effect is a reduction in the cost of doing business,” he says. The benefits of a reverse-logistics program are legion. To get the greatest payback possible, though, shippers must devote the necessary time and resources to the project.

Reverse logistics, in fact, should be part of the overall business strategy for any manufacturer and retailer, says LeMirande of Redwood Systems. Companies today often don’t consider reverse logistics when they plan their sales and operations strategies, he says, but they should: “If you’re not including reverse logistics in your supply-chain strategy, you’re cutting your supply chain off short. ” Whether goods and materials are being returned for repair, refurbishing, recycling, or resale, reverse logistics has its own unique considerations.

And when companies need to manage returns across international borders, reverse logistics becomes an even more complex process. That complexity–not to mention the cost of freight, which often outweighs the benefits of taking the item back–discourages many companies from bothering with international returns, says Kevin Sheehan, president of Dallas, Texas-based Processors Unlimited. His company, which recently was acquired by USF Logistics, manages reverse logistics at 45 processing centers nationwide. Yet sometimes there are compelling reasons to become involved in reverse logistics internationally.

In some instances, a returned product can be sold to recover some of the costs incurred, says Dale Rogers, professor of supply chain management at the University of Nevada-Reno. “If you can recover some asset value out of the refurbished product above the cost of transportation, it may make sense to ship it outside the country,” he says. And if a company imports items into the United States and they are returned by the end customer unused, he adds, it may be possible to resell them in a third country and claim a refund on the original import duties under duty-drawback regulations.

There are many other factors that affect a company’s decision to handle returns internationally, including customer goodwill, the desire to keep name-brand products out of secondary sales channels, and environmental concerns. Here’s a look at why three shippers made that decision and how they manage international returns. Witco Corp. , a global manufacturer of specialty chemicals based in Greenwich, Conn. , for example, faces several challenges when managing returns of reusable stainless-steel totes from customers in Canada.

The company must keep track of the individual containers, which are shipped with chemicals inside, emptied by the customer, and then returned for cleaning and reuse. It also must ensure compliance with both U. S. and Canadian transportation law because the totes often contain hazardous chemicals and residues. Finally, Witco must prepare proper documentation to allow the totes to clear customs on both legs of the round-trip journey. With a large number of containers moving back and forth between the two countries, the potential for confusion and error would appear to be great.

But the $1. 9 billion company maintains tight control over its equipment with the help of its third-party service provider, CF Reverse Logistics, a division of Consolidated Freightways. About three years ago, Witco hired CF to track, monitor, and arrange the return of the reusable equipment, reports Sheldon Ellis, Witco’s international logistics manager. Customers call a toll-free number to notify the company when the empty totes will be ready for pickup. “All they need to do is tell [CF] the tote number,” Ellis says.

Because CF tracks the totes by identification number from the time they leave the manufacturing plant, the carrier knows where “home base” is for each container, he explains. CF picks up the empty tote, then follows Witco’s routing guidelines to ship it back to its point of origin. Rather than ask customers to create export documentation for the containers they use, Ellis has CF prepare most of the necessary paperwork. A customs broker selected by Witco clears the totes at the U. S. border. No duty applies, because the containers themselves are not being bought or sold.

Growing World of Sony

It’s not news that Sony is a global company or that (25%) of all Play Station profits’ for the past seven years came from Sony to Japan. After all that’s what international marketing and the global economy are all about, companies like Sega, Nintendo, Microsoft, X-Box doing business around the world. The global economy now reaches every corner of the United States. Current interest in international marketing can be explained by changing competitive structures coupled with shifts in demand characteristics in markets throughout the world.

With the increasing globalization of markets, companies find they are unavoidably enmeshed with foreign customers, competitors and suppliers. A significant portion of all products made in the United States is foreign made. Japan’s economy is based on a strong work ethic and being a leader of technology, in which has helped Japan advance to the second most powerful economy in the world. One notable characteristic of the economy is the working together of manufacturers, suppliers, and distributors in closely-knit groups called keiretsu.

The keiretsu, which means “order” or “system,” is a unique form of business that links companies together in industrial groups that provide Japanese business with a substantial competitive edge over non-keiretsu organizations. Keiretsus are collections of dozens of major companies spanning several industries and held together by cross-shareholding, old-boy networks, interlocking directorates, long-term business relationships, and social and historical links. There are six major Japanese industrial keiretsu groups and eleven lesser ones.

Together, the sales in these groups are responsible for about 25 percent of the activities of all Japan, and keiretsus account for 78 percent of the value of all shares on the Tokyo Stock Exchange. Japan’s industry, which is the most important sector of the economy, is heavily dependent on imported raw materials and fuels. For three decades overall real economic growth had been one of the highest, 10% in the 1960s, 5% in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in 1992-95 largely because of the aftereffects of over investment during the late 1980s. Growth picked up to 3. in 1996, largely a reflection of low rates of inflation.

But in 1997-98 Japan experienced a recession, centered about financial difficulties in the banking system and real estate markets. In early 1999 output has started to stabilize as emergency government spending begins to take hold. Here of some of Japan’s statistics for 2000. Japan is the home to of the top companies in the world. One of the companies, which has helped Japan’s economy to be one of the top, is Sony. Modern day Sony is a high profit high output company, which is manly due to its marketing strategies and decision to its customers.

What is marketing? Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, and services to create exchanges that satisfy both individual and organizational goals. Marketing also include being able to get the goods from the producer to the consumer. The producer is responsible for the design and manufacture of goods. Marketing also includes market research and product development, design, and testing. Marketing concentrates primarily on the buyers, or consumers and determining their needs and desires.

Companies then need to stress the availability of products and the important product features. You then need to develop strategies to persuade them to buy and keep their satisfaction with the product. Marketing management includes planning, organizing, directing, and controlling decision making regarding product lines, pricing, promotion, and servicing. In addition, the marketing department of a business firm is responsible for the distribution of the products, determining the means of distribution that will be used and supervising the profitable flow of goods from the factory or warehouse

Sony has a complete grasp of this. Sony, which is based out of Japan has expanded to almost every country including a tremendous market in the US, is considered by many to be a marketing marvel. Sony has a dedicated consumer backing, due to its ability’s to market it’s products and keep it’s consumers happy. The company name “Sony” was created by combining two words. One is ‘sonus’ in Latin, which is the root of such words as ‘sound’ and ‘sonic’. The other is ‘sonny’ meaning little son. The words were used to show that ” Sony” is a very small group of young people who have the energy and passion toward unlimited creation

Though Sony is perhaps best known as a consumer electronics giant, the company is a major provider of technology and services to business, as well. On both consumer and business fronts, Sony is rapidly reinventing its business model for a networked world. For example, Sony successfully arranged a deal with Cablevision for a new generation of set-top boxes. And the lure of content from Sony Pictures, Sony Music, and other entertainment assets has helped Sony build valuable relationships with companies such as Microsoft, Palm, Microsystems, and TiVo.

With a library of more than 4,400 films and more than 40,000 hours of television programming, along with the work of more than 1,000 recording artists on various Sony Music labels. One of Sony’s best and most successful marketing strategies was aimed at their debut of Playstation in 1994. Sony’s idea to enter the very profitable video gaming world was a very profitable move. In 1994 when Sony decided to enter the gaming world unknown to them at the time they rewrote gaming history. Sony’s playstation soon reached the top of the market and then in 200 they did it again with playstation 2.

Sony’s entry into the video gaming world was a shock to both Nintendo and Sega. Nintendo, for once had been outdone. Sony, which had once been its ally, now became their number one competitor. The battle between Sony and Nintendo got really vicious. After Nintendo’s nasty little surprise at a Japanese show, Sony sat down and planned ahead. Sony’s marketing was bigger than either of its competitors could have dreamed of. Then they bought a major software company, Psygnosis. They employed some of the greatest programmers and hardware designers ever heard of.

And then to top it all off, Sony made a rather large deal with Namco, the second biggest arcade machine maker in the business. The Playstation became the most powerful console on the market. Sony researched using its unlimited cash to find out what type of game console that a consumer was looking for and came up with almost the perfect machine. Using some of the existing technology from the fabled SNES CDROM, Sony decided that the best bet was to market this wonder machine under its own label, thus making it another Sony product and convincing the purchaser that they can’t go wrong. And so far they’ve been the favorite in the war.

It was Sony PlayStation that single-handedly made gaming cool. But that was not good enough for Sony. It 2000 Sony introduced the Play Station 2 console. The Playstation to 2 become the hottest new toy before it was even on the market. The play station 2 was sold out long before it ever reached the shelves. Sony once again rewrote gaming history with playstation 2. Part of the magic and popularity behind playstaion 2, besides the Sony name, was is it’s ability to play back DVD videodiscs, and support for all types of sound hardware, including Dolby Digital and DTS, which is, used for home theater systems.

These added options plus it’s ability to play back the original playstation games made it appealing to every one regardless of age. For the Kids you had the hottest new system that could also play the original play station games even faster, for the parents you had a new DVD Player. Sony’s ability to market and tailor the playstation to a wide range of consumer young and old is what but it on top of the charts.

Even with the introduction of Microsoft’s XBOX and Nintendo’s game Cube this October Sony is still topping the charts this Christmas season. Sony’s has proved it’s self in the gaming world and has its consumers behind them. The strategies that Sony uses is marketing it’s playstation is not complex, Sony just uses it’s assets to find out what the consumer wants and need and then gives it them. Sony produces high quality products tailored to the need of its consumers. A simple concept that has left Sony and Playstation on top of the charts.

Planning and Ethics

AIM Investments is a mutual fund company that is located in Houston’s Greenway Plaza. Founded by Ted Bauer in 1976, the company has grown from a handful of investors and employees to one of the leading fund companies in the United States with over 2000 employees. This paper will describe the organization’s structure, the communication processes within the organization, and suggestions for solving communication problems. AIM’s organizational structure, as a whole, appears to be dominantly based on the Classical approach.

Its strong structure, division of labor and vertical hierarchy are clearly visible in its printed organizational charts. At the peak of the company’s hierarchy is the parent company, AIM Management Group Inc. , which is the holding company. The five operating subsidiaries- AIM Advisors Inc. , AIM Capital Management Inc. , AIM Distributors Inc. , Fund Management Company, and AIM Fund Services -horizontally fall below the parent company. Within AIM’s transfer agent subsidiary, AIM Fund Services, there are eight departments.

Direct Support Services, Dealer Support Services, Quality Support Services, EPIC, Cash Management/Retail Alliance, Client Services, Correspondence and Retirement Support Services have different, but equal responsibilities within AIM Fund Services. AIM Funds Services does not stray from the vertical hierarchy. At the top of the AIM Fund Services organizational chart is the president of the subsidiary, to whom the vice presidents of each department report. Our focus will be within Retirement Support Services. Retirement Support Services’ organizational chart does not differ much from the other subsidiaries.

The department is made up of six groups; Automation, Listbills, Transfer of Assets/ Rollover, Surgical Strike, Technical Resources and Processing. Each group, headed by an assistant vice president or manager, has from one to four teams. A team consists of 7 to 12 representatives, ranging in levels from II to V, who report to an assistant supervisor and supervisor. The supervisors have direct formal lines of communication with the manager or assistant vice president. Management attends several meetings weekly to discuss uniformity in policies and procedures and to ensure unity of command.

Each team member in every group has formal written job duties and descriptions of policies and procedures. Policies and procedures for processing specific types of requests along with job duties for each level of employee are clearly written on the company’s intranet for all employees to access. Retirement Support Services is a very-task oriented environment. The overall responsibilities of the group emphasize task accuracy and efficiency. Quarterly bonuses and career advancements are dependent on surpassing the written quality and efficiency levels and accepting additional responsibilities.

Employees who produce at the minimum levels are not awarded with bonuses. Even though the structure is clearly formal and vertical on paper, the atmosphere and people display characteristics that set the tone for a Cultural or Human Relations environment. The employees all are dressed in business casual attire, which is as liberal as the written dress code guidelines. Business suits with jackets and ties as well as hosiery are optional; however, gentlemen must wear collared shirts and ladies are prohibited from wearing open toed shoes.

On this particular day, jeans were allowed for “Go Texan Day, which is just one of the many themed activities and rituals displayed in the office. Banners, paper-weights, coffee mugs, mouse pads and many other paraphernalia display the subsidiary’s slogan, “We do it right, the first time, on time, every time. ” The AIM Investment logo and slogan, “Invest with Discipline” is on everything from pencils to golf shirts. Each team is proudly displaying their individual team names and teambuilding projects. The culture here appears to be very focused on teamwork.

The department shows Humanistic characteristics by holding weekly group specific meetings complete with representatives, assistant supervisors, supervisors, manager or assistant vice president and vice president (on rotation). During these meetings, management presents new policies and procedures, updates and goals. The representatives have an opportunity to speak on issues, offer suggestions and ask for clarification in an open forum. Biweekly team specific meetings are held with supervisors, assistant supervisors and representatives to discuss work ethics and team related issues.

Retirement Support Services as a whole holds a formal quarterly meeting to update all groups on progress, goals and give out awards for productivity, quality and team players. Group meetings even stretch beyond the parameters of Retirement Support Services. The entire subsidiary, AIM Fund Services holds a formal quarterly meeting in 2 different time slots with the same informative objectives. To go a step further to make sure all employees are kept informed of the company’s progress, goals and objectives, a company wide formal quarterly meeting is held in 3 different time slots and televised to remote locations.

All facilitators speak in conversational dialogue on all meeting levels with each meeting ending in the “open door policy” or “feel free to email or met with me or your supervisor if you have questions, concerns or suggestions. ” Human resources classes such as “Who Moved My Cheese,” “How to Balance Work and Home,” are offered along with many other services and training classes through the company to display the humanistic approach of the company. The company’s founders wrote a book titled “People are the product” and issued each employee an autographed copy.

The operations subsidiaries take on characteristics of a social systems school. Some areas are dependent on others. The company’s mailroom is responsible for feeding the work to the different departments. Once processed in the various departments, the completed work is output to the clients in appropriate form through the company’s control department or rejected through the correspondence department. If any of these groups encounter a delay or increase in work volume, then all departments are equally effected. The climate of communication is reliable and positive. Open superior – subordinate relationships are valued and encouraged.

Superiors appear to be communication oriented. Although open forum meetings are popular for groups and teams within the organization, personal superior- subordinate communication is heavily dependent on email. In effort to keep the employees informed, emails marked “urgent” or impromptu meetings are held to channel immediate and major changes within the organization down to subordinates. In meetings superiors encourage subordinate participation. During monthly and quarterly reviews, superiors appear approachable to set a tone for open dialogue and offer constructive criticism and suggestions for improvement.

Sensitive to the needs of subordinates, superiors offer flexible work schedules and approve time off to assist with balancing work and family. Although communication between superiors and subordinates appear to be very strong and open, both feel that the entire communication process itself can be overwhelming. The open forum meetings create constant debates and are sometimes unproductive due to “round table” discussions. The abundance of meetings of both superiors and subordinates cause a strain on the workflow process. Subordinates joke that AIM should be an acronym for “Always In Meetings.

Subordinates feel the mundane of management in meetings has taken superiors completely out of touch with the processes and tasks for which they are required to govern. The constant need for consensus creates lack of credibility for superiors to make individual decisions, thus negatively affecting the downward communication process. Subordinates are forced to develop stronger peer relationships in order to resolve issues in completing tasks. Subordinates feel that superiors are overwhelming them with constant emails of changes in policies and procedures to processes for which they no longer have first hand experience.

In conclusion, there are three areas for which Retirement Support Services could improve. Reducing amount of time in unproductive meetings, increasing hands on processing by superiors and reducing amount of unnecessary communication will improve workflows and superior-subordinate relationships. The should superiors assume stronger, yet not overbearing, leadership roles when facilitating meetings to ensure productivity of the meeting thus reducing the number of follow up meetings and email updates to pending issues.

Solicit possible agenda topics and proactively prepare researched answers to reduce amount of spontaneous issues and follow-up. This will reduce extended meetings and need for follow up, increasing time for face-to- face interaction with subordinates and involvement in workflow. Lower level management, such as supervisors and assistant supervisors actively participate in the everyday processing tasks as often as schedule permits. This will reestablish working credibility with subordinates.

Finally, superiors should reduce the amount of unnecessary information that is channeled to subordinates. Keeping subordinates of possible and immediate changes becomes ineffective if it is not organized and too spontaneous. Designate on person to be responsible for communicating the information the group when information is thought through thoroughly and can be presented concisely. Too many emails from different sources on the same issues are interpreted in many ways or could be so overwhelming that is disregarded altogether.

Business Description Of Ben & Jerrys

Ben and Jerrys is a successful ice cream company with many strengths and weaknesses. The company faces serious competition, financial struggles, economic and social influences, all of which are covered in my paper. I also discussed some recommendations I have for the companies success. Ben and Jerrys is one of the top ice cream companies around. They have had many ups and downs throughout the history of the company, but overall, they have overcome most of their hardships. They have some serious competition facing them in the ice cream industry; they have faced financial struggles, internal issues, and some social and economic factors.

In conclusion, I have come up with a few recommendations for the company to possibly improve things in the future. Haagen Dazs is currently the main competitor in the concentrated market place for super premium ice cream. Substitutes are however available. There are other ice creams not in the super premium category. To an extent, these are the real competition. However, for the market B&J caters for, their strategies should not have a great impact on B&J. The frozen yogurt lines which B&J now provides, also has a number of direct competitors to deal with.

Dealing with other substitutes is not that simple. Expensive (or inexpensive) chocolate, cakes, croissants and other desserts are realistic options for consumers. Other companies are going to try to assure you that their product is the perfect accompaniment to any meal. B&J needs to be aware of this. How he/she makes the choice for ice cream (as opposed to chocolate, etc. ), then super premium (as opposed to premium or ordinary) and finally B&J (as opposed to Haagen Dazs etc. ) is imperative.

The possibility of new competition in the market place is limited by two major problems, the brand and distribution. Remembering that these are higher market consumers, where by cheap alternatives are not necessarily desired, then the key element is the brand. This brand and the image that comes along with it, are something currently only Haagan Dazs and B&J have. This emotional tie related to B&Js and everything it possesses beyond what it is in itself (a good tasting ice cream), is something that will be difficult to imitate.

It is a question of I wouldnt be seen dead eating another ice cream as opposed to this is cheaper and tastes just like B&Js so Ill buy this from now on. The other obstacle concerns distribution. With ice cream, the idea of selling products through the Internet, despite the dried ice, which may accompany it, is not a likely option. B&Js is a fresh ice cream and by nature, difficult to transport. Consequently, distribution to stores around the USA and globally will be expensive and require partners, such as Dreyers, that have an extensive transportation network.

This is potentially a concern or risk for B&Js. Having a rival manufacturer distributing their ice cream is likely to cause conflict, and B&J should change this immediately or have an adequate back up plan. With both the above barriers, the key competitor may be the other ice cream manufacturer in the premium or ordinary market, especially the premium market. As it is, these competitors already have the distribution network and the know how. But, it will still take a large investment for these manufacturers to sell their image. B&Js also has their share of internal issues.

Due to the baby boom in 1994 the target market of Ben & Jerry has declined vastly. Although Ben & Jerry still hold a large percentage of the small market share, the company needs to decide on whether this target segment is worth sticking with. At one stage, Ben & Jerry’s pricing strategy worked really well, however it has become evident that demand over recent years has shifted towards lower priced products, leaving pricing strategies being a big issue for the company. Until 1994, all of Ben & Jerry’s promotions were gained through the company’s socially conscious practices.

However price wars with main competitors left the company having to pull funds off advertising campaigns to fund price discounts and store coupons. Due to the fact that imitations for the product are being developed more rapidly, Ben & Jerry have changed their primary marketing goal to establish products that cannot be imitated, but the technological developments of the company have not allowed them to launch the products within a decent time limit. B&Js mission statement includes the need for a wide variety of innovative flavors. Five years to find the perfect coffee bean seems unnecessary.

Coffee ice cream, in this period, may have become undesired by the customer. This scenario is compounded by, the quick replication by competitors, and the high costs related to manufacturing each different flavor. As a result, it is key to stop producing brands not received well, as well as introducing new flavors quickly. Flavor of the month may be a way of bringing consumers to them on a regular basis. Research will be key in identifying the market in any region or country B&J wishes to operate, especially into consumers needs and wants.

The way choices are made needs to be understood and the positioning of B&J needs to accommodate this. The decision is based, amongst others, by the mood of the potential consumer at the time of decision. Ben & Jerry seem to be proud of the success rate of their relaxed, casual culture and having employees involved in the decision making. However this policy needs to be reviewed as decisions are taking too long to be made due to large staffing numbers. But with staff turnover very low, changing the decision making process could be very difficult.

If it is not bad enough that the company is losing market share, the company putting more funds into promoting their image, than to the shareholders is irritating investors even more. A happy medium will have to be found for Ben & Jerry to gain confidence back from their investors. Ben & Jerry exist in a consolidated market place with just two major companies. Themselves and Haagen-Dazs. There is severe competition between the 2 players. If this rivalry is weak, then the two companies have an opportunity to raise prices and earn greater profits. However, if rivalry is strong, significant price competition, including price wars, can occur.

This competition could push the prices down in the long run. The amount of demand also affects the intensity of internal rivalry between companies. Growing demand tends to reduce rivalry as companies can sell more without taking away from other companies, resulting in high profits. On the contrary, declining demand results in more rivalry, as companies fight to maintain profit. Ben and Jerrys has also faced some economic and social factors that have affected them. In 1994, sales were flat, profits were down, and the companys stock prices had fallen to half its value.

While Ben & Jerry had thrived in the 1980s, the coming of the baby boom in the 1990s meant a middle class society that was more health conscious. The company realizing its fall in sales, quickly responded to the changes in consumer demands and introduced Ben & Jerry Lite. This line failed. It seems that Ben & Jerry failed to forecast and acknowledge the changes in consumer tastes, and was faced with increasing competition with Haagen-Dazs, which introduced its low-fat Ultra Premium ice-cream. Their social commitments to their customers community and suppliers have contributed to a successful and unique image,

Ben & Jerry donated a portion of their sales from their Rainforest Crunch Ice Cream back into environmental preservation causes in South America. Ben & Jerry also established the Ben & Jerry Foundation, which donated 7. 5% of its pre-tax profits helping non-profit organizations, such as: an establishment in New York to help drug addicted pregnant women, and individuals and families affected by the AIDS virus in Brattleboro. Such efforts had contributed to winning over certain consumers, however it is arguable to what extent this will have on winning the hearts of international consumers.

So this makes one wonder how much the companies unique ways really affect consumers behavior. In my opinion, there are a few things that Ben and Jerrys could possibly do to improve their success in the upcoming future. In todays environment, change, rather than stability, is necessary. Rapid changes in technology, competition, and customers demands have increased the rate at which companies such as Ben & Jerrys need to change their strategies and structures to survive in the market place.

One of the reasons why B&J has lost market share is because they failed to change themselves and adapt to a new competitive environment. To overcome this, Ben & Jerry need to identify the main barrier to change such as consumer tastes. This can be overcome through the development of a marketing plan, as there seems to be no real evidence that Ben & Jerry have done this. Employee productivity is one of the key components of a companys efficiency and cost structure, so this needs to be improved upon in order to make the company more competitive.

The culture of the organization is strongly influenced by the founders, and changes will be hard to achieve. It is not recommended that the culture of the company be changed, but that devising new ways to increase employee productivity enhances it. I think that the employees would be most successful being put into self-managing teams. Each team will be responsible for an entire task and time deadlines should be given. I also think that pay rewards should be given to the teams that complete their task to the highest standard.

This option could lead to a more flexible work force, as employees will get to know each others jobs within the company. It can also create a more equal organizational structure, which would make the decision making process a lot quicker and all employees will be involved. In conclusion, I think that Ben & Jerry has the potential to prosper as long as they: are prepared for upcoming changes in consumer needs and wants, compromise between maintaining their company image and satisfying their investors needs, and try to reduce their costs by considering all of their other options.

Napster First Amendment right

Napster (http://www. Napster. com) is a company that operates exclusively online as a virtual music forum. Napster not only allows its visitors the ability to participate in ongoing discussions through its message board forums and online virtual chat rooms, but it also allows its visitors the capability to exchange music files (MP3s) with other Internet users. Because Napster is a “virtual” online public forum, Napster should be protected under the First Amendment. Under the First Amendment, “we the people,” are protected by these rights of freedom of speech and assembly.

The idea of people coming together in one specific area of the Internet and being able to talk about music is essentially a right of all Americans. We have the right to “freedom of assembly” and the right to “freedom of speech. ” This is why Napster should not be shut down. Napster should be protected under the First Amendment. Wait!!!! What is a Napster? Shawn Fanning was a nineteen-year-old college student at Northeast University, when he first introduced his program Napster. Fanning had two loves: one was sports and the other was computers. As his curiosity grew for computers, he decided to stop playing sports.

He then concentrated most of his time working with computers. He primarily focused on two aspects of the computer, programming and the Internet. During his freshman year at Northeast University, in 1998, Fanning was trying to enter computer science classes higher than the entry level (Jones, 2001, 1A). Not finding anything challenging about the courses he was enrolled in, Fanning decided to start writing a Windows based program in his spare time. He spent most of his time in chat rooms with experienced programmers who knew the tricks of the trade, so to speak, of computer networking.

Shawns roommate loved music files, most commonly known as MP3s, but disliked most music sites that had limited music files available. He also disliked the idea of having to search endlessly from Website to Website for songs. Fanning, having this in mind, and his programming skills at hand, he wrote a program that he entitled Napster. He used the idea of all users being connected to one central computer server, and having access to each others music files that users wished to share (MTV News, 2000, 1).

Spoken in a more technical manner Napster makes its application software freely available for download by consumers from its website. This software allows users to connect their PCs to and participate in the Napster peer-to-peer file indexing system. Users are not required to share any files with others, either as a condition of using the Napster system or in order to obtain files from other users (Reuters, 1999). In short, Napster is a facilitator that allows its users to trade music files. It was created by Fanning because other music-trading sites were in his view, unreliable.

The idea of program sharing MP3s and giving people the ability to make customized compilation CDs (also known as burning a CD) of their favorite artists songs may sound brilliant to the users of Napster, but to the musicians whom creatively write the music, this is in their view, is a form of stealing. They have not only spent hours producing and writing music, but music is something that is published and copy-written. The Recording Industry Association of America (RIAA) is currently representing the band Metallica, rapper Dr.

Dre, and five other major record labels, which are all plaintiffs in a copyright infringement and piracy lawsuit against Napster (Reuters, 1999). When the Napster software is downloaded on a computer hard drive, Napter serves as an online music community, where you can conduct a search of the other users songs (MP3 files) that are currently online. According to Fanning, There are consistently eight hundred thousand people using the Napster service, limited only by their resources (MTV News, 2001, 1). This statement is the exact argument that the RIAA is using to sue Napster.

On May 8, 2000, the RIAA sued Napster for copyright infringement (Heilemann, 2000, 1-2). In their opinion they feel that there are over eight hundred thousand people stealing music at any given time. The RIAA believes that Napster and its founders are promoting the illegal reproduction of copyrighted music, and not giving any royalties to the owners of the songs (Reuters, 1999). Their theory behind the lawsuit is that there is no reason for a lover of music to go out and buy a compact disc that they like, why would a person want to buy a CD, when they could get it for free?

They belief that Napster should be shut down until it compensates the artists for lost revenues for copyrighted music that was stolen. There is not a First Amendment right to take someone elses copyrighted expression and duplicate it (Freedom Forum Staff, 2000,1). On the flip side, Napster believes that shutting their company down is in violation of 1008 of the Audio Home Recording Act (AHRA), which immunizes all noncommercial consumer copying of music in digital or analog form (Reuters, 1999).

This basically means that since Napster is not profiting off of the music, and the sharing of music is intended for the soul purpose of the noncommercial consumer usage, therefore, it is protected by the AHRA. According to Napsters newsletters, as a condition to your account with Napster, you agree that you will not use the Napster service to infringe the intellectual property rights of others in any way (Earp, 2001, 1). Napster believes that they are just the facilitators in an online exchange forum. Napster is the program that links computers together, not the program that steals music.

They contest that they have done nothing wrong and that they shall not be shut down by a court of law. As to this day, the litigation between the two parties (RIAA and Napster) still has not been fully resolved. The CEO of Napster, Hank Barry, and Andrea Schmidt, the executive at Bertlesmann, (one of the world biggest media conglomerates and a plaintiff) went to the zoo one day and as odd as this may sound, “during a critical point in their eight-week-long secret negotiations” about the current lawsuit that Napster was involved in were looking at the exhibit with Lily the polar bear.

All of a sudden, “to their horror, Lily shot out a paw and savagely crushed the bird. The metaphors presented themselves immediately. “I don’t want Napster to end up like that pigeon,” Barry recalls saying” (Stone, 2000, 1). Napster is taking this lawsuit very seriously and is throwing everything in its arsenal to stop the destruction of itself. They are presenting statistics that strengthen their power, for example “in the past year, the recording industry has posted a ten percent increase in album sales” (Earp, 2001, 2).

They claim that there is an increase in CD sales despite the fact that Napster still exists. Napster is not hurting the music industry, in fact they believe it is helping them, so why bother shutting the program down. Shutting down Napster is the crime that will be committed; Napster is not the one committing the crime. The current lawsuit that is still pending between Napster and the RIAA is should not be considered in the argument that Napster should be protected by the First Amendment; the lawsuit is irrelevant to my argument.

I believe that Napster should be protected under the First Amendment. Napster is a virtual public forum. In this forum people assemble together, they talk about music, read about music, and most importantly they trade music. This idea brings up the point that Napster and its users have the right to assemble, and have the freedom of speech to talk about music. If the courts send down a decision in favor of the plaintiffs, the court is essentially contradicting a right that has been instilled in this country ever since it was formed.

It will be contradicting a right that was the main reason for the foundation of this country, the freedom of speech. Americans have the freedom of speech. Napster users also have this freedom. In order to implement the District Courts order, Napster would be forced to terminate is Internet directory, despite the fact that the directory serves numerous lawful purposes. Napster has the First Amendment rights to publish a directory, Napster users have First Amendment rights to have access to such a directory (Reuters, 1999).

This statement explicitly states that Napster and its users have the First amendment right to use Napster. In this program thousand of people assemble together at one time to talk about music and trade music. If Napster is shut down, the courts will be infringing on the First Amendment rights of Napster and its users. In concern to the lawsuit, the RIAA is suing Napster for copyright infringement. They are suing for copyright infringement because Napster users are trading music and then burning the music onto CDs without ever having to buy them.

Napster has presented a proposal that it would charge a flat one-time fee for the use of Napster (MTV News, 2001, 2). The idea of having to pay for a service may not leave a good taste in some users mouths, but on the other hand, some local users of Napster say they would be interested in subscribing to the popular music-file-sharing Web site if an appellate court shuts down the free service (McWilliams, 2001, 1A).

The idea of having to pay or not to use the service is irrelevant to the argument, but if having to pay the artists is the only thing that is going to keep Napster alive and to stop the government from crushing their First Amendment rights, then the act of paying should be enforced, and both side will be satisfied. In conclusion, Napster should be protected under the First Amendment. Napster is a public forum where people can get together to talk to each other and trade music files.

The First Amendment clearly states Congress shall make no law abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble (Bill of Rights). These are the rights that Napster and its users all have, for they are members of the United States. Regardless of the current lawsuit about copyrights that is still pending, or whether or not the users of Napster should have to pay for the services, Napster should be protected under the First Amendment.

Starbucks Company Essay

Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles as we grow. The following six guiding principles will help us measure the appropriateness of our decisions. Provide a great work environment and treat each other with respect and dignity. Embrace diversity as an essential component in the way we do business. Apply the highest standards of excellence to the purchasing, roasting, and fresh delivery of our coffee. Develop enthusiastically satisfied customers all of the time.

Contribute positively to our communities and our environment. Recognize that profitability is essential to our future success. III. Company’s goals and objectives Starbucks had some very good and professional goals for their company in the future. Not all goals were about dominating the market, but some were to earn the respect of customers and stockholders. Shultz wanted the company to become the most respected brand name in coffee and for the company to be admired for its corporate responsibility. He spoke of having a keystone value in the effort “to build a company with soul”.

That keystone value was that the company would never stop pursuing the perfect cup of coffee. Shultz wanted Starbucks to be known as the best place to buy specialty coffee that did not add any artificial flavoring polluting their product. Along with earning the respect of customers, Shultz also wanted to keep the respect and treat his employees with care. He wanted to offer Health benefits and stock options to all employees who worked 20 or more hours per week. Starbucks wanted to become a national company with values and guiding principles that employees could be proud of.

Earning the respect of customers and employees were not the only goals of Starbucks, but like any other company, growth was also on the mind. One of the first goals and dreams of Shultz was to setup Espresso bars in all the stores like he had experienced in Italy. He felt that the friendly and pleasurable environment would help the company grow and make customers feel that coming to a Starbucks was a good time. Shultz also had a plan to open 125 new stores outside the Pacific Northwest and outside the United States in the next five years. He wanted to open 15 stores the first year and five more each additional year.

To keep the quality of coffee that Starbucks sold, Shultz felt that the store should only be company-owned and not franchised out. -Strengths and weakness, opportunities and threats Starbucks, like many other companies had some strengths and weaknesses. One of the best strengths that a company can have is a CEO who is not afraid to take a chance and try knew things. Before Shultz came over to Starbucks the company did not have any plans of major growth or product expansion. Companies should always have knowledge of what they are selling and that is what Starbucks did.

They knew everything that there was to know about coffee and if they didn’t they would find out. Starbucks always prepared all of their managers and employees by sending them to training seminars and classes to learn how to roast the perfect bean, brew the perfect cup and how to serve each customer correctly. Starbucks believed in quality of its products and the character and location of its stores. Companies all have strengths, but they also have weaknesses to. Weaknesses were very easy to see when the company was first put together. Baldwin and Bowker were very narrow-minded and had no desire to expand the company very far.

The two were also afraid to try knew things such as starting an Espresso bar and a sit in area where people can sit around, talk and make new friends. Though after Shultz took over the company, it seemed as though the weaknesses started to dissolve and the opportunities began to grow. Shultz took advantage of the opportunity to expand the company into new areas and markets. Entering new markets brought forward the idea of creating new product lines. They started by selling bakery goods at the espresso bars and along with selling their beans, they began to sell their Starbucks Barista home espresso machine.

Opening the Espresso bar also enabled them to sell the CD’s that the company played while customers sat and drank. Partnering with Dreyer’s and Pepsi enabled Starbucks to put their name on ice cream products and the cold beverage market by creating Frappuccino. This all enables the company to earn an additional profit. Expanding too fast is one of the most important threats that Starbucks may encounter. Opening all these new stores at such a drastic rate can cause the company to endure major debt.

Debt can cause a series of chain reactions leading to lower wages, cutting benefits, closing stores and laying off workers. These are not major threats now, but at an uncontrollable rate, this is one of the main threats that can really affect the future of Starbucks Coffee. Comparing Starbucks financial ratios to that of the Industry can give us a general perspective of Starbucks financial strength. This could also give some indication of stock price performance. Most of Starbucks ratios are in line with the industry average, but there are a few that could explain the poor stock performance recently experienced.

Starbucks price to earnings ratio is well above the industry average, but this could be due to its relative high growth it has experienced. Return on equity is well below the average for the industry, and this could be an area of concern. This suggests that the investment made by shareholders in the firm has not produced a decent return when compared to the industry average. Starbucks gross margin is also below the average for the industry, suggesting that it is not able to cover its operating expenses as well as other firms in the industry.

Genetically Modified Foods

Monsantos downfall could be attributed to several reasons. The passion of Alan Shapiros vision blinded the Company into making rash decisions and the large amounts of money spent pursuing the objective prevented any U-turns later. The companys unshaken beliefs that it was correct had made it arrogant and not listen to the outrage all around. Monsanto underestimated consumer resistance.

There was no obvious benefit in the products introduced. It may have been a different story if the products were introduced in developing counties where transport is poor or people starving from crop failures.

Monsanto also ignored cultural differences. Canada and US were indifferent to genetically modified products but there was anger in Europe and the UK. Recent blunders by government handling the BSE and Mad Cow outbreaks dampened peoples confidence in genetically modified products.

Selling the idea of genetically modified crops is not easy. The industry needs to persuade people of the benefits and the companies must be seen to be socially responsible, socially responsive and ethical. Companies mission statements must not seem to be solely profit driven.

Introduction – Monsanto and Alan Shapiro’s Vision

“It’s about the earth, it’s about the environment, and its about food. It’s about health and nutrition. Those are deep, ancient things for civilisation, and they are for the people.” – Alan Shapiro

The Monsanto Company in 1995 led by Alan Shapiro was involved in agriculture, pharmaceuticals, food and chemicals. Shapiro’s passionate vision was the application of biology to food, nutrition and human health. He believed that people would want the products offered by Monsanto. The products themselves are protected by patents, thus restricting competition. All Monsanto needed to do was dominate and position all their products as either number one or two in their respective markets.

Consolidation started in the seed market that was already concentrated in the hands of a few companies. By 1999 Monsanto spent more than $8 billion making acquisitions. Four corn seed companies had controlled 87% of the US market in 1996. Monsanto acquired two of them, Holden’s Foundation Seeds and DeKalb. Delta & Land Pine controlled 75% of the cottonseed market and Monsanto made a bid for that company too.

It was a simple winning strategy preached by Jack Welch at GE, dominate your market or get out.

(a) The downfall on Monsanto.

Mission Statement Did Not Include All Stakeholders V Ethical Issues

All entities, individuals and companies should have a mission statement, a set of beliefs and priorities that guide actions and ethics in decisions. Typical mission statements include paying particular attention to the demands and requirements of certain, if not all stakeholders. For an individual, it may be the family and employer, for a company, it can include shareholders, customers etc. The term stakeholders for a company can be narrowly defined to include only shareholders, customers and employees or a wider definition to encompass the community and society generally.

Mission statements or objectives are an integral part of any organisations culture. These beliefs are so deeply entrenched into staffs disposition that they would act automatically on them. I have no doubt that Shapiros passionate belief in genetically modified (GM) products would have had a strong influence on the Companys corporate objective. Shapiros passion and having $8 billion committed (sunk cost factor) to this strategy would have effected his decisions. Their confidence on the technology may even have promoted arrogance within the organisation.

With hindsight, it can be seen that Monsanto’s mission or corporate objective did not include listening to the community and society generally. As Shapiro confirmed at a Greenpeace conference in 1999 Because we thought our job to persuade, too often we forgot to listen. If Monsantos mission statement included care for the society and the community it operated in, it is unlikely that it would have suffered the fate it did. A poorly defined objective resulted in the Companys unethical behavior anad ultimately its demise.

Incorrect Product and Target Market V Social Issues

Monsanto targeted the wrong segment of the market. Developed countries, especially Europe did not appreciate, or need genetically modified foodstuffs. These products offered no obvious benefit, solved no problems but posed possible risks.

R&D has been focused on the needs of the U.S. society. Hence, the largest segments of GM products are seeds that are herbicide tolerant. Unfortunately, developing countries cannot afford herbicide whilst European consumers prefer organic produce.

Many commentators believed that the range of GM seeds and products introduced were unsuitable for developed nations. Consumers who were not starving and health conscious would appreciate a cholesterol free egg more than a delayed ripening tomato. If Monsanto introduced a rice with increased pro-vitamin A to underdeveloped countries, where vitamin A deficiency was a major cause of child blindness, Shapiro would be placed on the same stage as Fred Hollows and not treated as an outcast.

Marketing Analysis of Oakley, Inc.

For my strategic sports marketing project, I decided to report on the sports marketing activities of a particular corporation. I specifically wanted to report on the marketing operations of a rather diverse company; one that offers more than one product line for more than one sport. Oakley, Inc. is a company that offers several different products for a wide range of sports. I will now briefly describe the company and its operations, as well as its primary sports marketing goals and objectives. Company Info.

Oakley, Inc. a Washington corporation formed in March 1994 to succeed to the assets and liabilities of Oakley, Inc. , a California corporation, which commenced operations in 1977 and began to sell sunglasses in 1984 (Scott, 1998). The company is an innovation-driven designer, manufacturer and distributor of consumer products, including high-performance eyewear, footwear, watches and athletic equipment. Oakleys principal strength is its ability to develop products which demonstrate superior performance and comfort through the combination of patented and other proprietary technology and unique styling.

The company has focused on eyewear innovations for sports applications, and its products are worn by a variety of athletes, such as skiers, cyclists, runners, surfers, golfers, tennis and baseball players and motocross riders. In addition, the companys products, which are currently sold in over 70 countries worldwide, have become increasingly popular with fashion-oriented consumers in the larger nonsports, or recreational, segment of the sunglass market.

Oakleys products currently include sunglasses (e. , Frogskins, M Frames, Zeros, Wires, Jackets, X Metal, Fives, and Topcoat), goggles, face shields for use with sports helmets, sunglass accessories, gear bags and a limited range of athletic footwear, technical apparel and premium timepieces (Scott, 1998). With focus on consumers for the next generation, the company has established itself as a legitimate world brand with unique expertise in product design, performance and production. Product Design & Development

State-of-the-art technology allows Oakley to shorten dramatically its product development cycle. Stereolithographic computer modeling is combined with CAD/CAM liquid laser prototyping to create fully detailed, wearable prototypes of eyewear and footwear (Oakley. com, 1999). Rapid iteration of working models allows for extensive testing and perfecting of product design before introduction to the public. After the development stage is complete, the final sculpture can be used directly in preparation of production tooling.

Utilizing these processes, the company is capable of introducing a new product line within four months of initial concept. Oakley has obtained hundreds of patents worldwide to protects its proprietary manufacturing methods and product features. Among the companys most important patents are those which guard its achievements in torodial single-lens geometry and the associated manufacturing techniques, dual-spherical lens technology and the associated optical advances, and innovations in frame design and functionality (Oakley. com, 1999).

The proprietary technologies employed in lens cutting, etching, and coating, as well as the companys significant investments in specialized equipment, are matched with exclusive formulations of production materials to produce the superior optical quality, safety and performance of Oakley eyewear (Mayes, 1998). Oakleys historical success is attributable to its introduction of products that represent improvements in performance and style over goods available on the market. To that end, the company strives to develop methods of production that provide greater precision and less cost than its competition.

Establishing itself as a global brand, Oakley has diversified beyond the eyewear market. The utilization of advanced technologies in fabrics and fabrication has placed Oakley at the forefront of innovation in the design and production of apparel. In addition to clothing, Oakley has also entered the performance footwear market. The initial footwear release was marked by a reinvention of current styles and sciences. The company continues to expand the limits of todays technologies, most recently by introducing wristwatches that merge critical innovations in gearing, bearings and microcircuitry from around the world (Oakley. m, 1999).

The company intends to introduce other product line extensions and new product lines in the future, in order to attract additional consumers to the brand. This type of diversity is part of the reason why Oakley has been so successful. Sales & Marketing The primary functions of Oakleys sales force are to sell to each retailer the appropriate mix and quantity of Oakley products, ensure that products are displayed effectively and educate retailers about the quality and features of Oakley products and Oakleys sales and marketing philosophies.

The company believes that its relationships with its customers, effective marketing and superior customer service are critical elements of their success (Walker, 1999). While Oakley uses traditional marketing methods in some instances, the company attributes much of its success to the use of less conventional methods, including sports marketing, targeted product allocation, advertorials and in-store display aids (Oakley. com, 1999).

Oakley has used sports marketing extensively to achieve consistent, authentic exposure that equates into strong brand recognition on a global level. Oakley utilizes the exposure generated by its athletes as an editorial endorsement of Oakleys eyewear rather than a commercial endorsement. The sports marketing division consists of 25 sports marketing experts domestically, with an additional 20 managers positioned in direct offices and with distributors internationally.

These experts specialize in each market segment and niche to negotiate contracts with athletes, identify and develop relationships with undiscovered talent, coordinate exposure with the media, educate and train these Oakley ambassadors about Oakley products and support them at all events and public forums where they wear Oakley products (Ryan, 1999). Oakleys sports marketing staff is diverse enough to understand and effectively market all sports, regardless of the sports image and special equipment needs.

Oakley earns the respect of its athletes even in the most core of sports such as surf and snowboard, yet continues to expand successfully into more traditional sports such as golf, tennis and baseball. Advertising & Promotion Oakley retains significant control over its promotional programs and is able to deliver a consistent, well-recognized advertising message at substantial cost savings compared to complete reliance on outside agencies (Zimmerman, 1997). Localized strategies of marketing and distribution are managed by direct operations in Europe, South Africa, Mexico, Japan, and Canada.

In other parts of the world, the integrity of the brand is safeguarded by carefully selected distributors who present Oakley products to their markets with local expertise (Oakley. com). Oakleys primary method of enhancing brand recognition is sports marketing, which places the Oakley brand before consumers through the endorsements of influential athletes and other personalities, some of whom have formal arrangements with the company. Some of these athletes include Michael Jordan, Mark McGwire, Dennis Rodman, and David Duval.

The effectiveness of this promotional strategy is believed to outweigh that of direct advertising, which often lacks the impact and recognition of athletic endorsement. The company believes that direct advertising can be useful, but only in situations that do not lead to competition with editorial coverage (Woodson, 1998). The second level of marketing is advertising. Products are promoted through print media, outdoor media, in-store visual displays, and other point-of-purchase materials. Promotion includes packaging, mailers, catalogs, billboards, the Internet and other media.

Oakley considers many factors in evaluating the effectiveness of these marketing opportunities. In addition to cost effectiveness, analytical criteria include the ability to engage new market opportunities, build image, enhance the statute of the brand and reinforce the identity of the brand (Woodson, 1998). During the past year, the company has expanded its direct marketing efforts by utilizing its cutting-edge Internet site and direct mail campaigns to more closely connect with the consumer. Oakley also maintains an intriguing and instructive presence on the Internet.

Oakley has made an extensive effort to continually enhance its virtual domain site enriching dynamic visuals with engaging text (Ryan, 1999). The companys diverse Internet offerings include: O StoreSM, a secure location for Internet commerce where customers can make purchases and track their order; and receive the latest information on Oakley athletes, technologies and new inventions. Beyond its own Internet site, Oakley utilizes alternative Internet sites, such as Yahoo, for promotion, and has purchased keywords such as sunglasses, optics, Oakley and others (Oakley. m, 1999).

When a customer visits the Yahoo site and searches with one of these keywords, an Oakley banner is displayed at the top of the page, and a double click will take them to Oakleys home page. The emphasis placed on Internet promotion and commerce, combined with efforts in attaining editorial coverage through the use of professional athletes, as well as more immediate contact with the consumer through direct marketing, reflect the forward-thinking nature of the companys advertising and promotion strategies (Scott, 1998). Principal Customers

During 1998, net sales to the companys ten largest customers, which included five international distributors, accounted for approximately 35. 7% of the companys total net assets (Oakley. com, 1999). Net sales to one customer, Sunglass Hut, the largest sunglass specialty retailer in the world, accounted for approximately 26. 0% of the companys 1998 net sales. Such sales do not include those sales to Sunglass Hut locations outside the U. S. that are made by the companys independent international distributors. At December 31, 1998, Oakley independent distributors serviced approximately 138 of the 1,768 Sunglass Hut locations worldwide.

While Oakley does not have any minimum purchase agreements with Sunglass Hut, the Company believes that it maintains a good relationship with Sunglass Hut. In early 1994, Oakley entered into an exclusive licensing agreement with Sunglass Hut to sell Oakley products through mail order catalogs, and in 1998, two Oakley mail order catalogs were produced with Sunglass Hut (Sunglass Hut, 1999). Competition Oakley is the leading designer, manufacturer and distributor of eyewear in the sports segment of the nonprescription eyewear market.

Within this segment, the company competes with mostly smaller sunglass and goggle companies in various niches of the sports market and a limited number of larger competitors, some of whom have greater financial and other resources than Oakley (Woodson, 1998). Some of these niche markets are susceptible to rapid changes in consumer preferences which could affect acceptance of Oakleys products. Oakley believes that the heavy protection of its intellectual property rights has limited the ability of others to compete in this segment.

Oakley believes that it is the established leader in this segment of the market, although several companies including Baush & Lomb, Luxottica, Bolle and other companies compete for Oakleys shelf space. Oakley also competes in the broader nonsports, or recreational, segment of the sunglass market, which is fragmented and highly competitive (Ryan, 1999). The major competitive factors include fashion trends, brand recognition, marketing strategies, distribution channels and the number and range of products offered.

The same companies mentioned above also compete in this market. Oakley differs from many of its competitors in that its competitors generally only import or repackage eyewear products. Few sunglass companies design, manufacture and assemble their own creations as many companies tend to imitate successful sunglass models (Oakley. com, 1999). In order to retain its market share, the company must continue to be competitive in quality and performance, technology, distribution, style, brand image, and customer service.

Within the athletic footwear and sports apparel market, Oakley competes with large, established brands such as Nike, Adidas, Reebok, and Fila, which have greater financial resources than Oakley. In addition to these companies, Oakley also competes with smaller brands, such as Airwalk, Timberland, and Vans. The upper-middle and luxury segments of the watch market are dominated by established Swiss brands, including Rolex, Breitling, Gucci, Omega, TAG-Heuer, and Movado (Oakley. com, 1999). Evaluation & Recommendations In evaluating Oakleys sports marketing program, I would give the company a nine out of ten.

It is obvious that their marketing strategy has worked wonders for their eyewear, and it has yet to be seen whether or not their strategy for the footwear and watches will prove to be as successful. Oakleys marketing strategy has helped them achieve a sustainable competitive advantage over their competitors. I think the idea of athlete endorsement has been a large contributor to their success. Keep in mind that Oakley has succeeded despite their lack of television commercials, and very limited print ads. Some recommendations that I can offer is to try and concentrate their efforts onto their footwear division.

Many people are suggesting that Oakleys expansion into the athletic shoe market is doomed to be unsuccessful. However, with their continued success in the eyewear market, Oakley has proved that they have a good idea of how to sell their products. I would suggest trying to get a high profile athlete, such as Michael Jordan, to endorse the shoes. Strive to gain the customers attention and awareness of the footwear. The more a customer sees the shoes on TV and being worn by high profile athletes, the more likely they are to purchase the shoes. Conclusion

In conclusion, I believe that Oakley has a strong grasp on the market and it is in large part because of their marketing strategy. It seems that everywhere one looks, they will see several people with Oakley sunglasses around their eyes. Because of Oakeys well trained marketers they are able to succeed in how to properly promote and advertise their products. Oakley has a well rounded mix of ways to get theirs products out into the consumers minds. As we head into the next millennium, I believe that Oakley will find even more unique and effective ways to market their innovative products.

Limon Dance Company

Limon Dance Company is the nations oldest modern-dance company. Jose Limon established Limon in 1946. In the beginning the company only survived by word of mouth but eventually grew to be one of the Nations best and well-known Modern Dance Companys. The Limon Dance Company survived with many of its original dances intact, these dances preserve the legacy of mid-century choreographers and showed the Companys talent. The three pieces that the Limon Company performed were Champion, The Winged, and The Moors Pavane.

The first piece performed was Sophie Maslows Champion. (First performed in 1948. ) Champion was based on a short story by Ring Lander, and showed how violent the fighter life was in the ring and at home. The dance was done in rounds. The first round the boxer beat up his mother, the second round he beat up his girlfriend. This story was told through strong masculine movements by the male dances. At one point the male dancers were in a gym working out. Each dancer imitated different methods of training.

Push-ups, sit-ups, sparring, and punching drills were all used in setting the scene of that part of the dance. Dancers used straight strong, but gracefully movements to convey the meaning of what was happening on stage. Limon did a good job of choreographing the fight scenes in Champion. All the fight scenes had energy and really made it look like they were in a boxing match. The Champion seemed to show an overall theme of violence in the piece. The Winged was the next piece in the program performed by the Limon Company.

This piece was different from all the rest it seemed to turn the dancers into birds or some sort of animals and was difficult in my view to understand. Many of the dances used fast repetitive hand motions to simulate flying and seemed to move across the stage in sharp flowing motions like that of birds. The Moors Pavane was apiece based loosely on William Shakespeares Othello. Using 16th century music by Henry Purcell, and costumes that resembled period clothing Pavane looked like a dance that would be performed in a kings court.

This ballet used strong, stark movements that showed the emotions of the actors. The males all used forcefully straight movements to show meaning and emotion in their dancing, while women displayed smooth delicate movements. All actors used push and pull, and equal weight in there dancing and this technique made the dance more interesting to observe. I also especially liked the use of a square to show unity between the actors and I liked the way the piece ended and began in a similar way it gave the piece closure.

Florida Pipeline Company

In 1984 Ken Lay became chairman and Chief Operator of Houston Natural Gas. It quickly doubled when it bought Florida Pipeline Company. The next year in 1985 Houston Natural Gas merged Internorth Incorporation. With the merger they both combined to own around 40,000 miles of pipeline and shortly after they changed their name to Enron. Around that time Washington was being lobbied by energy corporations to deregulate business and let companies set their own prices.

Energy companies said this would not only lead to the end of monopolies but the extra competition would benefit companies and consumers. Over the next several years Washington began to lift controls on who could produce energy and how it was sold. With an influx of new suppliers energy prices were very unstable. With these deregulations Enron was allowed to sell natural gas on an open market such as oranges and wheat. With this new way of business Enron was able to grow into the seventh largest company in the United States with over 25,000 employees in over thirty countries.

It became an innovator in gas trading and technological advances in the energy field. In 1990 Enron hired Jeffery Skilling as the company Energys Trading Operation Consultant. At age thirty-six Skilling was able to create the Gas Bank. The Gas Bank is when a company buys large volumes of gas from producers and resells it to industrial customers at long term contracts. This helped stabilize the gas market which was very volatile at the time. It also helped expand gas production nationwide and helped Enron grow to a major player in the energy industry.

As Skilling went up in rank he started to get the company involved in risky investments to make more profit. In an interview with the University of Virginia he said We like risk because you make money by taking risk, This was one of the many reasons which got Enron into financial debt, Skilling also persuaded regulators to allow Enron to use market-to-market accounting. A technique used by brokerage companies for securities trading. It allowed Enron to count long-term contracts as immediate profit although most of the money wouldnt be coming in for several years.

For example if a pipeline in Europe was projected to produce $89 million of profit it would be posted, but there was one problem the pipeline hadnt been built yet. With the high tech boom Enron moved its gas and electricity online, hoping to cash in on the high stock prices of the dot-coms. Enron sold Wall Street and as a result the stock tripled in value from 1998 to 2000. This was not the only reason it tripled but a definite factor. Within this time Lay and Skilling cashed out around $475 million worth of stock.

Around this time the company was involved in horrible investments. They were buying ridiculous amounts of power plants, pipelines and other ventures which were over priced and not even going to be profitable. With Jay and Skilling wanting to continue this trend of growth Enron turned itself into a factory for financial deeds that would pump its profit, protect its credit rating and drive up its stock price. So Enron turned to its Financial Chief Officer Andrew Fastow who set up several partnerships. The very first one to note was called LJM1 which hedged risky stock investments.

Enron set up these partnerships using stock as funding which did not appear on the companys balance sheet. These partnerships were set up as an SPE or a Special Purpose Entity, which agrees to pay Enron if it investments decline in value. As the investments decline payments were made to Enron and posted as profit. But in reality Enron was paying it self with its own money. At the end of 1999 LMJ1 gave Enron a paper profit of $300 million. With the success of LMJ1 Fastow created LMJ2 with Skilling’s support. LMJ2 was started with $300 million of bank loans and investors money.

This partnership was about twenty times greater than LMJ1. As a result of these paper partnerships, Enrons stock price rose to new levels. LMJ2 was doing great it provided most of the profit in 2000 and was invisible to outside investors. Over the next year questions began to arise about the LMJ partnerships. The stock began to rollercoaster from $80 to just below $50. But on November 1, 2001 Enron announced that J. P. Morgan Chase and Citi Group would provide them $1 billion in additional loans. This announcement again shot the stock in an upward spiral and almost doubled it at around $85.

But in reality Enron was not being successful. They were only making one cent for every dollar they accounted for which is not profitable for any company. In the month of November Enron began to restate their profits from 1997 to 2000. In 1997 they reported $105 million in profit while in reality it was only $77 million. In 1998 they reported $733 million while in reality it was only $600 million. In 1999, $893 million was reported but in reality only $645 million was in profit. In 2000 they reported $979 million in profit when they only produced $880 million.

They were in true debt for more than $628 million by the end 2000. More than $630 million came from improper accounting and another $296 million in profit came from hidden tax cutting transactions. This sent the stock plummeting from $70 to 60 cents and produced losses of more than $60 billion on paper. With this fall in stock price, Enron filed for bankruptcy on December 2, 2001. Since the fall of Enron and other major corporations, Senate and Congress are now trying to configure a major reform bill which would protect workers and their pensions.

President Bush also signed off on a new accounting-reform legislature which creates an oversight board that would investigate and punish accounting violations. Now the last step by the government is putting everyone involved behind bars. Skilling is set to testify before a house committee and has chosen not to invoke the Fifth Amendment as many of the other board members have chosen to do. Fastow has to also testify before congress but will plead the fifth to avoid self incrimination. Kropper, Enrons director of global market pleaded guilty last weak to the demise of the company.

Changing To Fit The Times

Introductions of new ideas into different cultures happens all the time. Some examples are in Africa people trying to introduce new technologies to the people there to improve the lives of the people there. Another example is how the McDonalds company is sprouting new franchises in countries all over the world. The idea of new technologies being introduced to people who need them is a wonderful idea, although the idea of a new restaurants may not be.

In this paper I will discuss how the introduction of new ideas into other parts of the world is not for the good of all. This new “thing” can change the cultures of the people who live there, the way they lived may be drastically altered or disrupted. What ultimately should be done, is a vote for majority to determine whether the people in these areas being affected by the new ideas, want them. Using the Frye model, Angell proposes in her essay, and using it to determine how and whether new ideas should enter existing cultures.

If the situation arises where cultures are being changed by new ideas, such as fast food restaurants in foreign countries and biotechnology where organic farmers live, there should be a certain amount of respect to the existing ways of live. The way people lived before the new technology or new cultures was there first, so there is a level of respect to the way it used to be. Although, the new ways may help or improve the old ones. These new ideas should be agreed upon by the people effected by the new ideas. This is where Angell and her Frye model fit in.

The idea of a consensus upon the idea presented is the better way to go for determining an idea that will affect a large group of people. In Schlosser, McDonalds’ are popping up everywhere on the planet, a consensus should be taken to determine whether or not the people in the area where McDonalds is thinking of locating, wants them. Also in Pollan’s essay biotechnology is the big culprit, the Monsanto company is producing and taking over the potato growing industry and people who buy the potatoes are not given a choice of if they want organic or enhanced.

The people in the problem areas are not given a choice of what they want, because they are forced to take what is given, we must find ways to determine the fate or these people. Angell brings forth two models for which to help solve problems; the Daubert and Frye models. The Daubert model says the decision is the given by one person with supreme power. Angell discusses these people as “gatekeepers” who decide upon a solution. This person holds sole responsibility for the entire population under his power.

This idea can not work with the problems demonstrated, the rights or opinions of all can not be relied upon by just one person. This one person could not possibly make a worthy decision for all the people he speaks for, everyone would have a different view, opinion, idea or criticism. Although the Frye model suggested does make more sense in the cases of Pollan and Schlosser. The Frye model proposes a consensus of all being affected. An excerpt from Angell “the court refused to admit it, on the grounds that there was not yet a scientific consensus” about it, helps demonstrate the effect a consensus can have.

This example talks of a jury in a court case not allowing a lie detector test to be admitted because it was not well known yet, so the majority voted on the idea to not allow it to enter the court. This is the better model to use for both Schlosser and Pollan’s problems. Schlosser announces a problem with McDonald restaurants effecting local cultures. He says McDonalds restaurants are stationing themselves all over the globe. So much so that he states “Ernst Doerfter, a prominent member of the doomed East Germen parliament, who called for an official ban on McDonalds and similar abnormal garbage-makers'” (Schlosser 480).

The quote shows just how much McDonalds is trying to associate themselves with every country. East Germany was bothered so much by fast food places that they called for a ban on them. Schlosser allows the reader to understand this more by his statement of “the traditional German restaurant serving schnitzel, bratwurst, knockwurst, sauerbraten, and large quantities of beer is rapidly disappearing in Germany” (Schlosser 483). Schlosser depicts the new McDonalds idea has put the traditional ideas of Germany out the window by this quote.

This is where the Frye model can be used to help the community. The people in the areas being “taken over” by McDonalds could meet in a common place and vote on the decision to allow them to build or not. In doing this, everyone is heard and has a chance to voice their opinion, no one is left in the dark and has their very own chance to stop or allow what they wish. The Daubert model would not work as well because one individual would be the determingin factor of whether or not McDonalds was allowed to build. How could one single person speak for the whole and give equal representation?

Also, influences from the outside may help the “gatekeeper” to make his decisions more easily, example could be the McDonalds or another restaurant paying the “gatekeeper” to allow them to do what they want. Why should an American idea such as McDonalds be forced upon groups of people in other countries who might not want them? I know if I were from another country I would rather eat my native food than eating the food of another country. One answer man be the owners of the McDonalds are trying to set new buildings all over to increase their flow of money much greater.

They do not care about the people they harm or the cultures changed by their ways, this is evident because it is still happening all over the world. Schlosser is saying that McDonalds and other restaurants like it are intruding onto foreign grounds trying to make a foot hold in countries which they are non-existent. By intruding onto these foreign grounds, McDonalds is altering the cultures that existed before it. When new ways are forced upon people, they should be able to determine themselves whether or not they it to survive. People should not have things forced upon them if they do not want them.

Pollan is affected by the influence of new ways by biotechnology creating new crops for farmers to grow. For example he cites the toxin produced by the New Leafs and the potential effect of the new crops to help insects become resistant, in return removing one of the farmers most crucial tools. Pollan states “the widespread use of Bt in biotech crops is likely to lead to insect resistance, thus robbing organic growers of one of their most critical tools”(Pollan 511). The biotech companies are introducing so much of the insecticide that evolution will take control and help the insects to survive what is killing them.

A solution to this is to allow the farmers of both crops, organic and biotech, to meet and vote on whether biotechnology should be used, and if so how can it maintain or improve the situation under the gun. A common consensus is really the only real solution to the problem, if a panel of people were to vote on the topic they would be farmers who do not like the members of the panel and would disagree with them. The same problem would arise if a single person were to decide the fate of biotech, people would not agree with his decision, and would probably do what they believed was better behind the laws back.

The same problems and solutions would be in this example as the McDonalds in Germany example; people would be unhappy with a decision they felt they did not take part in. If I were an organic farmer, and understood the problem that could arise I would like to put my two cents in and show others what may happen with resistance in insects. That is why the Frye model works better, everyone is allowed to make their own decision and take part in saving or improving their way of living. Another problems that arises from biotechnology is the failure to indicate on labels of the foods we eat.

We as a consumer, have the right to know what we put into our bodies. As Pollan points out: The label on a bag of biotech potatoes in the supermarket will tell a consumer all about the nutrients they contain, even the trace amounts of copper. Yet it is silent about the fact that those potatoes are the products of genetics engineering but also about their containing an insecticide (Pollan 516) This just goes to show how the consumer is left in the dark about what they eat. This is a major problem, not knowing exactly what you are eating.

Again, why should people be forced to adjust to something they might not wish to take part in. If I personally had a choice of eating a biotech product or an organic one, I would most defiantly go with the organic one. No public information has been emitted from the biotech companies to prove they are safe or what is exactly inside them. No consensus has been determined of whether people want to eat biotech plants or not, it is implied by the companies producing them, that everyone will want it.

A common solution to this is show what is in the foods we eat, let people know exactly what they are eating. Don’t let people be in a locked closet, all can be solved if some simple reasoning were put to use. All three examples shown show how people are forced to come to terms with what is influencing their lives. Using a common consensus or the Frye model proposed by Angell can help save cultures or ways of living. People shouldn’t be forced to subdue to what is overpowering them, voice and opinion is needed for the success of all.

Walt Disney History

When people think of animated cartoons, one name immediately comes to mind “Walt Disney. ” He is the most popular and known animator in the world. He wasn’t successful at the beginning of his career but he was a taskmaker and entrepreneur. Walt’s hard work and entrepreneurship made the world’s best popular cartoon character “Mickey Mouse. ” As an animator and an owner of Disney Corporation, he made a lot of influences in past and present days. Hereby the importance of his life and influences will be discussed, in a age order.

First of all, Walter Elias Disney was born in Chicago, Illinois, on December 5th, 1901, the fourth kid of five children of Elias and Flora Disney. The family often moved from place to place because of Walt’s father Elias. He tried his hand successively as a farmer, a businessman, an orange grower, a carpenter and But he expected all members of his family, no matter how young, to spend most of their waking hours working for him without any compensation. During Walt’s childhood and adolescence, Elias operated a farm in Marceline, Missouri. It was there that Walt spent his early years and developed his interest in drawing.

In 1910 the family moved again, this time to Kansas City. There he enrolled in art classes at the Kansas City Art Institute. In 1917 the family moved again, this time back to Chicago. In Chicago, Walt joined Red Cross unit and spent nine months as a ambulance driver in France at the end of World War I. After Walt Disney returned from France in 1919, he decided to make art his career. He soon joined the staff of the Kansas City Film Advertising Company, which was producing a simple type of animation. He and a colleague, Ubbe Iwerks, learned enough about animation to try doing some of their own.

They formed a company called Laugh-O-Gram Films. The company made fun of local problem and scandals in cartoon form. They sold well enough to give Walt and Iwerks the courage to go into business for themselves. But the Laugh-O-Grams didn’t hold Walt’s interest very long. He had a new idea to try, which was illustrating updated fairy tales in series of cartoons. The cartoons he and Iwerks produced were not bad, but Walt never got paid for hid films. Walt then started on a new fresh project, a series of funny story featuring a girl actress and animated characters. He called it “Alice’s Wonderland. Money was so scarce that he couldn’t even pay for the rent.

With such meager fund all he could produce was a pilot film for the Alice series. He thought Kansas City was not the place that earns much money, so he decided to move to California. In 1923, Walt Disney moved to California, and began Walt Disney Production with his brother Roy Disney and a colleague, Ubbe Iwerks. After five year of making silent cartoons, he produced ‘SteamBoat Willie,” the first cartoon to use synchronized sound1. In 1928 Walt Disney created a cartoon “Mickey Mouse” by using his own voice.

Disney’s success in “Mickey Mouse” led to the film series called “Silly Symphonies,” which was introduced n 1929 and first used color in 1932. Soon full color Disney cartoons was produced, such as “Three Little Pigs” and “The Tortoise and the Hare. ” These two films even won academy awards. 1930s brought fame and successes to Walt Disney as a creator of Mickey Mouse, Donald Duck, Pluto, Minnie Mouse, and Goofy. These characters not only appeared in cartoons but also on merchandise items licensed by Disney Production.

In 1937 the Walt Disney Production Studio produced the world’s first animated feature film “Snow White and Seven Dwarfs. Then came “Pinocchio and Fantasia” in 1940, “Dumbo” in 1941, and “Bambie” in 1942. Song of the South” in 1946, used cartoon characters with live actors. All of these films were successful. During World War II the Walt Disney Production Studio designed military insignias and made training films for the United States armed forces. After the war Walt Disney continued to make animated films, such as “Alice in Wonderland” in 1951, “Peter Pan” in 1953, and “The Jungle Book” in 1967. He also turned to live-action films such as “Treasure Island” in 1950 and “20,000 Leagues Under the Sea” in 1954.

Moving into totally new area, Walt Disney opened Disneyland in Anaheim, California, in 1955. He had wanted to design an amusement park where families could have fun together. Disneyland had exciting rides and attractions but was also spotlessly clean and run by smiling, friendly employees. The park eventually came to be one of the most popular tourist attractions in the United States and may be in the world, too. During the next ten years, Disney added new attractions to Disneyland while continuing to make the films the whole family could enjoy. “Marry Poppins,” in 1964, is considered by many to be the pinnacle of his filmmaking career.

Disney won a record 32 Academy Awards for his echnical innovations ideas in film. Walt Disney also pioneered the production of feature films for television. Some of these appeared on his weekly series “The Mickey Mouse Club (1955-59)” and on ” Walt Disney’s Wonderful World of Color,” which aired, under several titles for 29 seasons. Shows prepared for New York World’s Fair in 1964 enabled Disney to show off his Audio-Animatronics figures in such attractions as “It’s a Small World” and ” Great Moments with Mr. Lincoln. ” The life like figure of Abraham Lincoln, which recited passages from his speeches, never ceased to amaze fairgoers.

Walt Disney never rested. Even as he died, on December 15th, 1966, he was planning for a whole new Walt Disney World vacation kingdome in Florida, and EPCOT. It is an experimental prototype community of tomorrow. It is a fun area consists of a showcase, a recreation of foreign cities, spread like fan around lagoon. On the other side of water, the world of future is dominated by a 180-foot geodesic sphere, and Spaceship Earth. The sphere is is surrounded by a number of pavilions housing entertaining displays of future possibilities in the fields of energy, transportation, agriculture, ariculture2, and technology.

Spaceship Earth is devoted to information and communications from dinosaur time to the 21st century. In conclusion, Walter Elias Disney was a great taskmaster full of innovative ideas. In his lifetime he made so many movies and cartoons that play important role in children’s life. Also he played important role in the development of animation and film. Even now most people remembers him, because animation computer designers of Walt Disney Production are keeps remaking Walt old films and cartoons. Even-though he died, he still plays important role in our society, today.

Nike Campaign Essay

When I learned that I had to write this research paper, instead of procrastinating, I convinced myself to JUST DO IT. This phrase also happens to be one of the signature phrases of the leading athletic apparel company, Nike. The JUST DO IT campaign has been very successful for Nike, but it is not he sole reason for their success. Nikes campaign has definitely persuaded me to go out and buy a few Nike products. So what exactly does Nikes persuasive campaign consist of? This paper will discuss all aspects of Nikes persuasive campaign. Some of the campaigns strategies, goals, and techniques will be revealed.

Some persuasive theories that can be applied to the Nike advertising campaign will be identified and explained. After discussing these theories, the specific arguments of the campaign will be validated. Overall, the entire campaign will be analyzed and it will be determined whether the campaign is a success or a failure. The purpose of a campaign is to deliver a prospective consumer to the point of sale. Nike uses what is classified as a product oriented advertising campaign. Nikes entire campaign is centered on convincing the consumer to purchase their product.

The goal of most product campaigns is to educate and prepare the consumer to exhibit purchasing behavior, so that their company may become the leader in its market. Since Nike is already the leading athletic apparel company, their goal is probably to stay on top. Some of the major strategies used to achieve this goal are the use of television, magazine, and Internet advertisements. The developmental stages of a successful campaign help to establish the product in the audiences mind or consciousness. The stages of the Nike campaign can be described by using the Yale Five-Stage Developmental Model.

Yale researchers developed this model while observing the growth of national identity. The first stage of this model is identification. Our text states that Many products and causes develop a graphic symbol or logotype to create identification in the audiences mind (p. 264, Larson). The logo Nike is most famous for is The Swoosh. This is the term given to the symbol of winged victory that appears on Nike products. The design of the swoosh logo was inspired by the wing from the Greek goddess Nike.

The Nike logos presence can be noted in almost every aspect of the athletic world. An internet article documents this presence by stating, In every room of every house, in every city of every state, in every country is the check mark better known as the swoosh and even better known as the Nike symbol that is worth billions of dollars. Another important aspect of identification is the name associated with the product. The name Nike came from Greek mythology. Nike is the Greek personification of victory.

She can run and fly at great speed. Therefore, Nikes entire being revolves around victory. The Just Do It slogan, which was introduced by Nike in February 1995, would also fall under identification. This is one of Nikes most successful campaign ads. Well as it turns out, Just Do It wasnt too harsh. It was, in its cultural and commercial impact, along with Marlboro cigarettes and Volkswagen, one of the three greatest ad campaigns in American history (p. 47, Garfield).

In 1998, Nike came up with a new slogan I Can. This slogan was a flop and was soon discarded. The second stage of this model is legitimacy, which shows that the product is effective. Nike has legitimized its campaign by getting well-known individuals to support its product. Nikes most famous supporter is Michael Jordan. Michael Jordan is arguably the best basketball player ever, and therefore easily convinces the consumer that Nike must be the best product if he has chosen it. Participation is the third stage of this model, and this would consist of the involvement or support from uncommitted persons.

The advertising of Nike by stores, who are not committed to only Nike, would fall into this category. For example, even though Foot Locker sells almost every athletic shoe there is, it features only Nike in many of its advertisements in magazines. Stage four, which is penetration, means that the product has successfully cornered an area of the market. As a result, other companies may try to market a replica of the product. Nike has definitely cornered the market in athletic apparel. Nike has created a power brand in the athletic market. Nike was the first shoe manufactuer to enter the clothing realm.

Nike raced ahead of the pack by exploiting its brand power to move from athletics footwear into athletics clothing, turning itself into a aymbol of fitness and well-being (p. 24, Court). Other shoe manufactuers caught onto this trend and developed their own line of athletic clothing. The last stage of the model is distribution. The campaign needs to be able to deliver or live up to the promises made. In this final stage, the campaign succeeds and becomes institutionalized. The campaign must be able to give back to those who have supported it. Nike does this with rebates, coupons, and incentives for store owners.

Nike also does not have a problem with replacing or reimbursing the consumer if there is a problem with their purchase. One of the first theories discussed in our text that can be applied to Nikes persuasive campaign is the Aristotelian Theory. This theory was developed by Aristotle, a great librarian and researcher of Greece. The theorys development was based on Aristotles observation or persuaders at work in Athens. This theory consists of three parts, which are ethos, pathos, and logos. Ethos deals with the credibility or reputation of the advertisee.

Nike always picks people that have an ethos that would appeal to the viewer. Much of Nikes clout comes from its ability to round up some of the worlds best competitors to endorse its gear (p. 64, Miller). Nike is able to sell this concept to the consumer, by using testimonials from athletes that are the best in their sport. This does not always mean that the athletes they choose to endorse their products are angels. Its not afraid to bring controversial athletes into its stable. Example: basketball bad boy Charles Barkley, who has spat on fans at an NBA game.

After the incident Nike ignored the bad manners and put him on TV saying, Im not a role model (p. 64). Pathos addresses the emotional state of the audience, and is the second part of the theory. Our text states that In todays terms, pathos equates with psychological appeals. Persuaders assess the emotional state of one audience and design aartistic appeals aimed at those states (p. 60, Larson). Pathos consists of virtues or values. A good example of how Nike used an ad to tap into the audiences emotion was a 1995 advertisement featuring a runner named Ric Munoz. The ad is described in an article in the magazine Runners World.

The article states, Eight months ago, Nike contacted Munoz a 37-year old Los Angelas runner who was diagnosed HIV positive in 1987. Purpose of the call: Nike wanted Munoz to appear in one of its Just Do It ads. The 30-second spot intersperses shots of Munoz on a trail run with black-and-white placards. They read: 80miles every week! Then 10 marathons every year. And finally: HIV-positive (p. 12, Dugard). Even though this was a controversial issue, it was well received by the viewers. According to Nike spokesman Keith Peters, the ad aired 269 times on national TV by mid-April and received a 74 percent approval rating from viewers (p. ).

The final component of this theory is Logos. Logos appeals to the intellect or the rational side of humans. Logos relies on the audiences ability to process statistical data, examples or testimony in logical ways and to arrive at some conclusion (p. 61, Larson). A simple example of this is an advertisement in which Nike shows a plunger and a pair of their shoes side by side. The caption on the advertisement reads Always gets the job done. Nike uses examples how other objects perform and relate this function to their product. In a simple way the viewers can logically assemble the information and come to a conclusion about the product.

Another theory that can be associated with the Nike campaign is the Mass-media effects theory. This theory can be separated in three parts. The first part is by sharing a common pool of experience we become vulnerable to distortion and propaganda (p. 88, Larson). The common pool of experience is that most people enjoy watching or participating in sports. The viewer is then able to associate with one of the best in their favorite sport by buying the same products. The second part of this theory is that we are selective about the media messages to which we expose ourselves (p. 88).

The consumer wants to be a winner. The Nike advertisements allow the viewer to associate with one of the best in their favorite sport, and possibly be like them by buying the same products. The last part of this theory is that Mass-mediated messages have become so pervasive that we are on the verge of being overwhelmed by them (p. 88). This is definitely true when it comes to the swoosh. Evidently Nike was aware of this, because they have lightened up a little on the swoosh. A 1998 article in Sports Illustrated states, Well the sports world is about to get a little de-swooshed.

Not only has the company announced that it plans to cut endorsement spending on pro athletes by $100 million per year, but it is also said to be planning to curtail the use of the swoosh on many of its retail products. Instead of being displayed prominently on nearly all items, the swoosh would appear in smaller sizes (retailers have started to refer to a baby swoosh) in lighter shades, in less prominent locationsor not at all (p. 32, McCallum). Within the Mass-Media Effects Theory is the Technological Determinism Theory, which is also evident in the Nike campaign.

This theory maintains that the technology of any given era is the major determinant of the cultural patterns of that era (p. 88, Larson). This is evident in Nikes use of technology in some of its advertisements. Nike is an example of how to put together an integrated marketing campaign with the TV and the Internet playing to their own and each others strengths. The fast-action TV commercials from Wieden & Kennedy, Portland, Ore. , are cliff-hangers that urge viewers to find out how the spot ends at whatever. nike. com. People who do go to the site to find a multimedia bonanza and can watch video clips of several different endings (p. , Carmichael).

The Uses and Gratification Theory can also be applied to Nikes persuasive campaign. This theory assumes that receivers have various needs, ranging from low-order basic needs, such as food, shelter, or sex, to high-order, complex needs, such as self-identity (p. 90, Larson). The effects of this theory relies on the audience actively searching for a satisfaction of their needs through the media. An originator of this theory, Jay Blumler, identified four needs that influence people to look to the media. The first need is surveillance, which is the necessity to keep track of the environment.

Nike takes advantage of this need by coming out with new designs and products that people feel they need to have in order to keep up with the times. Curiosity is the second need, and it deals with discovery and previously unknown information. A perfect example of Nike addressing this need is the whatever. nike. com marketing scheme. This consists of a commercial that begins on TV, but you have to go to the website to see the ending. Many people who do not even plan to buy Nike products may visit this website out of sheer curiosity. Thirdly, this theory consists of a need of diversion or the need to escape.

Nike sponsers many activities that people can participate in that can help them get away from the stresses of their everyday life. An article in American Fitness, describes how one woman attended a Just Do It For You fitness and fashion workshop co-hosted by Nike. The speaker was the founder of Jazzercise, Judi Missett. The author of the article writes, Missetss inspirational words were followed by a video preview of the latest Nike advertising campaign, a lively and spirited focus on the healthy integration of mind, body and spirit.

Nikes fitness message all started with running, the campaign says, but remember the running is toward fulfillment, towards dreams come true (p. 3, Ferrari). Nike taps into the desires of the attendents of the workshop desire to do something for themselves, and according to the author the workshop was very effective. The last component of the uses and gratification theory is the need for personal identity. This is the need that Nike seems to try to appeal to the most. This need deals with the consumer wanting to have a sense of identity or belonging.

This sense of identity may come from role models we see on television, from political views written in newspapers, or from a certain type of music that we listen to and identify with our own lifestyle (p. 92, Larson). Nikes major argument for their campaign is that wearing their shoes will enhance ones performance. In order to prove their argument Nike uses Effect-to-Cause Reasoning. They show you the effect first, which is running the fastest or jumping the highest. Then they show you the cause, which is the wearing of their shoes.

I think this has a very positive and successful effect, because everyone wants to perform at the highest level. Ultimately, audiences are able to identify with personal experiences, and when persuaders tap into these experiences, the result is a positive one. Nikes campaign has been very successful over the years.. In the past it has put out stunning numbers For example, an article in the magazine Advertising Age reflects some of Nikes numbers during the year of 1998. It states The company has since gone from an 18% share of the domestic sport-shoe business to 43%, from $877 million in worldwide sales to $9. illion (p. 1, Garfield).

These are very significant numbers and are proof that Nikes persuasive campaign is very successful. However, Nike began to see a drop in sales in the companys third quarter of 1998. The Asia economic crisis, brown shoes, resignations, and boring ads resulted in soft markets, sagging future orders, and sliding economies. Now Nike is a $9. 5 billion company trying to get to $15 billion with a management team that is stretched too thin. If management of Nike wants to make Nike a $15 billion company, Nike has to make adjustments to the problems that the company faced in fiscal 1998.

In order for Nike to be able to continue to stay on top, the problems referred to above must be addressed. They must try to correct the Asia crisis as best as possible and wait for it to pass. Also, the trend of younger people buying brown shoes has caused the sales of the athletic shoe to decrease. Nike has to fight this trend by creating athletic shoes that are cheaper and show more individuality. Rather than trying to come up with new physical innovations to their products, Nike is changing its marketing through a program called Alpha.

Under this new program, Nike will market its most expensive apparel, sporting goods, and sneaker products as a unit. Nike will use Alpha Athletes like Tiger Woods and Michael Jordan, who will be dressed in Nike from head to toe. This line of clothing is described in an article in Time magazine, The first of those is brand Jordan, whose Jumpman logo has replaced the swoosh on those famous sneakers. Nike expects to sell $300 million in Jordan merchandise in fiscal 1998 and considers the brand to have billion-dollar potential.

And Nike is creating a golf division around its $40 million swinger, Woods. He has his own brand, aimed at younger, more athletic golfers, and his togs carry his own logo, a swirling yin-yang emblem designed to reflect his Buddhist beliefs as well as his club speed. Another line, Nike Classic Golf, will target the country-club set (p. 6, Saporito). After looking at the numbers Nike has put up in the past, I believe that they do have a successful campaign. Even with the drop of sales, they are still leading in sales in the athletic footwear and clothing industry.

Why Microsoft is a monopoly

Through a combination of tactics that many people would consider monopolistic Microsoft is now involved in almost every aspect of the computer and computer-related telecommunications markets and is emerging as a major player in Internet commerce and on-line media ventures. As of March 1997, 87% of all the software developers were actually developing the Windows bit 32 platform, which is the operating system for Microsoft.

Fifty three percent of 2. illion US Professional developers use Microsofts visual basic program as their primary development language(1) Microsoft is playing an increasing role in their technical education, forging commercial partnerships with both commercial and academic training institutions. Microsofts Internet Explorer desktop browser has overtaken Netscapes software for navigating the Internet. Microsoft also has made many alliances with banks and its financial software, Money and Personal Investor, along with its financial server software, Microsoft is emerging as a key player in shaping the on-line financial transaction system of the future.

Its ownership of the Microsoft Network(MSN) and its partnership with NBC, which has created MSNBC venture has given Microsoft strong distribution outlets for its emerging range of media content. Its investment in Dreamworks gives it a position in Hollywood movie and music production that can be assembled into its on-line ventures involving interactive multimedia as computers and television combine in coming years. Also Microsoft is working to control the way people connect to the Internet from work and home.

Its $425 million purchase of WebTV gives it control of a major avenue for non-PC internet access. Its $1 billion investment in the cable company Comcast and proposed investments in US West cable now make it a major player in designing standards for accessing the Internet over cable. Microsofts Bill Gates is in partnership in a $9 billion venture to create a low-orbit satellite system called Teledesic that could give high-speed Internet access to anyone anywhere in the world, an investment supported by the US government through a massive free giveaway of radio spectrum to the company.

Microsoft has used that financial clout consistently over the last few years to acquire companies and their software and human assets, while sealing financial alliances with a range of partners. While many of the financial details have not been made public, Microsoft spent an estimated $1. 5 billion between 1994 and 1996 on acquisitions. (3) Microsoft has purchased many companies buying or investing in over twenty companies in 1996 alone.

Its investment have not only been with the $1. 5 billion spent on WebTV and Comcast, the $150 million invested in Apple, and the hundreds of millions invested in additional Internet-related companies, including its key investments in audio and video streaming. It has been acquiring key strategic technologies at a rate of over one per month. Surprisingly Microsoft is not at the peak of an industrys size but at an early stage in markets that are expected to explode in the next decade.

If unchecked, there is a real possibility of Microsoft becoming a financial and technological mountain dominating more markets and industries than any monopoly has ever dominated. The nature of high technology makes each individual market linked to other markets through a combination of software standards, training skills, development tools and physical architecture that must all be able to work in combination. The key to the economics of networked technology is that products and markets do not stand alone in these high-technology markets but instead reinforce one path of innovation versus any alternative path.

An operating system attracts software developed around that operating system, which discourages new competition since any alternative faces not only the challenge of creating a better operating system but competing against a while array of already existing software applications. Businesses train employees in one technology and are reluctant to abandon that investment in training, while the existence of a pool of people trained in that technology encourages other businesses to adopt that technology.

And as desktop software has to be able to work with client-server networks and an array of other technologies, it becomes nearly impossible to abandon an established set of technology standards that tie those different parts together. These so-called network effects give an incredible anti-competitive edge to companies like Microsoft that control so many different parts of the network and use that control to leverage position in connected markets. (5) Any market leader that has many financial resources can easily drop its prices to prevent an upstart from destroying its initial investment.

Since this is not a perfect world we have one company, Microsoft, that towers over its competitors in most market segments and who is doing everything possible to undermine open standards in favor of ones that its controls. As well , Microsoft has not been adverse to engaging in outright anti-competive practices as needed to assure its dominance of markets, as a string of lawsuits and complaints trailing in its wake can attest to. From his first days in the computer industry back in the 1970s, Bill Gates said repeatedly We want to monopolize the software business. )

And while he has actually changed his words, his actions have shown no change in attitude other than the range of industries he wants to monopolize has expanded. When competitors have released new software, Microsoft has announced upcoming better features on its own software- improvements which often would not materialize for months, even years after their scheduled release. Hidden features of its operating system have been used to give its own application developers an advantage over the competition.

And the bundling of software has allowed Microsoft to use dominance in both markets together. It has used its advantage of its monopoly control of the desktop to obtain dominance of Internet standards and in turn use that control to achieve a dominant position in Internet commerce. The Internet, while a potential threat to Microsofts dominance, is also an opportunity for the company to seize control of those Internet standards and thereby gain new network footholds on every computer connected to the Internet.

Through the combination of controlling standards in the Web browser market, Web servers, development tools for Internet software developers and development of standards for financial transactions on the Net, Microsoft is not only quickly dominating markets for software sales related to the Internet, it is using dominance of software technology to obtain a commanding position in consumer-oriented Internet commerce, from auto sales to classified advertising over the Internet.

It is seeking to further reinforce its dominance by controlling standards and connections to the Internet right from home. While the network effects of technology have played a large role in Microsofts monopolistic success, much of the blame belongs to the federal government for its failure to curb abuses by Microsoft, block its acquisition of key technology, or step in to support open standards not controlled by Microsoft.

The government must examine not only individual markets but how Microsofts expansion from desktop software to investments in enterprise computing, media content, on-line commerce and Internet access to the home all work in combination in anti-competitive ways. The operating system, MS-DOS and Windows, are the software core of almost all computers-linking keyboards, the central processing unit, memory chips and all other software together in a functioning whole.

While Microsoft has expanded its operations in the last few years, it was through control and sale of desktop operating systems in the consumer market that Microsoft made the fortune from which all other ventures have sprung and it is the operating system that has been the key strategic point of control that has given Microsoft a monopolistic advantage in other ventures. Microsoft is now using many of the same tactics that it used to monopolize the consumer market for the desktop computers to win domination of the business-level and Internet markets.

Microsofts MS-DOS operating system, begun in controversy and accusations of deceptive business practices, has been the subject of a Justice Department defense decree, and to this day is still the object of residual lawsuits from ertstwhile competitors. When IBM licensed the operating system from Microsoft in 1980, the fortune of the company was made as it went on to resell the operating system to almost every company seeking to build computers that were compatible with the new IBM standard.

While Microsoft has traditionally pushed forward its dominance through control of software, it is increasingly investing financial resources in professional training, and tilting the workforce towards Microsoft expertise. As Microsoft makes sure there are professionals available trained in its technology where its rivals often cannot, business will feel pressured to adopt Microsoft technology just to be assured of a trained workforce. Microsoft’s existing worldwide training and certification programs trained more than 1. 2 million technology professionals in fiscal year 1997 as part of a program Microsoft calls Skills 2000.

It reaches these professionals through an intensive combination of partnerships with computer vendors, work with commercial training centers, a free television-based training program, training sessions linked to conferences around the country and a growing network of academic alliances. (29) Microsoft is the only software vendor (outside fading Novell) which has its own professional certification credential. The company has worked with a variety of vendor partners and commercial training centers to establish its certification program; with 120,000 Microsoft Certified Professionals by 1997, the number had grown 250% in one year.

Concentrated in the consultant services and system integrators hired by other firms to set-up their computer systems, such strategic training is magnified as those Microsoft-trained professionals tilt the buying decisions of a whole range of companies(30 Microsoft is spending hundreds of millions of dollars on training–thousands of dollars per person trained–on other peoples’ employees in order to tilt the supply of software professionals towards Microsoft technology.

Microsoft is also tying over 300 academic institutions and 40,000 students a year into its training program through its Authorized Academic Training Program It provides free technical training to teachers and educators and has shaped those academic programs to create Microsoft Certified Professionals, adding the academic stamp of approval to its own programs. Essentially, Microsoft is taking advantage of the weakness of standards in both the private and public technical education fields to mold them into subsidized Microsoft recruitment tools.

Looked at comprehensively, Microsoft is using its training programs to further reinforce the network effects already tilting control of corporate computing under its dominance. Its competitors like Novell, Sun and Oracle are scrambling to create a multi-company training network to contend with this Microsoft-controlled training system, but it is an unfortunate fact that our country’s whole system of technical education is being distorted as it becomes one more tool for Microsoft’s monopolistic goals. The rise of the Internet has been both a threat to Microsoft’s empire and an opportunity to expand it to a degree impossible before.

With various forecasters expecting between $80 and $160 billion in electronic commerce by the year 2000, the Internet had become the decisive realm of computer competition for the future(35) And Microsoft is working hard to ensure that consumers will become captive customers of its monopoly. The threat of the Internet was obvious: with a twenty-year tradition of open computing standards connecting computers of all kinds, the Internet looked ready to make proprietary operating systems for individual machines an anachronism.

As the Internet broke into national consciousness in 1994 and 1995, it appeared that millions of computers were connecting to one another with Microsoft having nothing to say in the matter. The rise of Netscape and a host of other new Internet companies seemed to promise a new era of competition including a whole new cast of companies. The final nail in Microsoft’s coffin seemed to be when it introduced a new proprietary Microsoft Network on-line service as an alternative to the Internet; within months, Microsoft shut down the proprietary version in late 1995 and converted it fully into an Internet service provider.

But in many ways, Microsoft’s quick success since that point in seeking control of the Internet marketplace just shows the inherent monopolistic power of the company’s place in the computing world. Having dismissed the Internet until relatively late, Microsoft has in under two years been able to assume not only a competitive position but is now threatening to control the standards of the Internet. Microsoft’s slogan has been to “embrace and extend” (and thereby control) the Internet from its position of control over the desktop.

Nothing highlights Microsoft’s monopolistic strategies more than its attempts to destroy the open computing standards of the Internet-oriented Java language–an open standard for running software over the Internet created by Sun Microsystems and supported by hundreds of other companies. The most basic use of Java is for enhancements of Web pages–animated pictures, interactive queries from browsers – to go beyond viewing static information. But Java is ultimately a way for the Internet to act as one giant computer where programs can be located anywhere and be accessed instantly over the Internet from any desktop.

The key innovation of Java is to be platform-independent, meaning that a Windows user can run software from a UNIX server or even run sophisticated software from simple “network computers” that need only a stripped-down operating system for Internet access; most software functions will be run somewhere else on the network and only small “applets” need be sent back-and-forth between desktop and central computer. Obviously, Java is a direct threat to Microsoft’s Windows franchise and the power Microsoft derives from it, so Microsoft has done everything possible to undermine Java’s “write once, run everywhere” programming standards.

Microsoft’s first strategy was to create a competing software system called ActiveX for allowing Web designers to create mini programs on their Web sites to lessen the immediate demand for Java “applets. ” Microsoft quickly used its control of major development tools like Visual Studio and its web server support software to make writing ActiveX commands as easy as possible to lure developers and companies to adopt ActiveX. And this strategy partly worked with an estimated $400 million market in ActiveX components created by 1997. (49)

Strategic Plan For General Nutrition Companies Inc

General Nutrition Companies Inc., was founded 65 years ago in Pittsburgh, Pennsylvania on the premise that Americans wanted to maintain control over their health. David Shakirian founded the company. In 1935 he launched a dream of his by establishing a little health food store in Pittsburgh, Pennsylvania. He called it Lackzoom. The products that were offered at his store included yogurt and healthy foods such as honey, grains and healthy sandwiches. The concept of being a health store and serving health food was thought to be a fad that would soon pass over back then.

To the surprise of many of Shakarian’s critics, many people embraced Lackzoom. David and his store came a long way from its first days receipts of 35 dollars to open a second store six months later. Since those first two stores, Lackzoom, which is now GNC, has grown to be the largest manufacturer of vitamins and mineral supplements in the United States (1998 Annual Report). General Nutrition Companies, Inc. , collectively with its subsidiaries, is the only nationwide specialty retailer of vitamin and mineral supplements, sports nutrition products and herbs, and is also a leading provider of personal care, and other health-related products.

The products were sold through 3,757 General Nutrition Centers, 2,531 of which were owned and operated by the company and the other 1,226 stores were franchised. Much of the growth of GNC has occurred in the last 7 years. Since 1992, the Company has opened or acquired in the United States 2,593 new GNC stores (SEC 10k form). The companys initial growth was through company-owned stores located primarily in regional malls. Many of the stores that were created in the past 7 years have been franchises. This franchise initiative has enabled GNC to expand into secondary locations as well as International markets.

It appears that there is no end to the growth of GNC. At a Franchising meeting on February 6,1999 GNC awarded and agreed to open an additional 323 domestic and 428 international franchise locations. All of these stores report to GNC headquarters, which is located in Pittsburgh, Pennsylvania. Pittsburgh is also home to one of General Nutritions three distribution centers. The other two distribution centers are located in Atlanta and Phoenix. The products that are distributed through these channels are manufactured in Greenville, South Carolina.

This facility is one of the largest and most modern vitamin and supplement manufacturing facilities in the United States. Within the coming months a new 600,000 sq. ft. manufacturing plant and distribution center in Anderson, SC will open which will double the capacity of the company (www. gnc. com/about/history). The company has many products that it distributes from their first-class distribution centers. These products include vitamin and mineral supplements, herbs, diet products, food products, personal care, and miscellaneous health care products.

These products are sold under the General Nutritions various proprietary brand names, including Ultra Mega, GNC, Pro Performance, Preventive Nutrition, and Harvest of Nature. In addition, the Company carries various third-party brand name products including Weider, Twin Lab, EAS, and Met-Rx. The companys product mix focuses on high-margin, GNC proprietary brand, value-added products emphasizing vitamin and mineral supplements, sports nutrition and herbal products.

This increase was driven by the success of the Companys store expansion program and increased demand for the Companys products, as reflected by increased sales, across all business segments. During 1998, the Company developed a web site, GNC. com, to sell products via the Internet. Although still in the early stages of operation, the Company expects sales to increase based on the growth of the Internet. The history of GNC shows their excellence in planning and execution of these plans. Going into the next millennium, the Company must actively scan their environment for opportunities and threats.

The General Nutrition Company is exposed to many external threats. Over the past five years there has been a trend in consumer behavior towards healthy living. This trend has caused the health product and supplement market to drastically increase. Some of the most prominent external threats that GNC faces are new competitors, competing products and services, new technologies, government regulations, increasing customer expectations, general economic conditions, and the different cultural ways of the host countries. External Threats: New Competitors

Some of GNCs new competitors include Internet and mail order companies such as discountnutrition. com and the Vitamin Shoppe have entered the vitamin and supplement market recently. They have taken some of the Companys residual sales by offering different mediums of purchase. The Internet and mail order companies tend to offer discounted prices because they buy their products in bulk. A new competitor that has appeared in small regions across the United States has been Vitamin World. These shops tend to carry a similar product line with the exception of General Nutritions exclusive products.

In addition to Vitamin World many other small chains have been started. Two of these chains are Great Earth and Vitamin Specialty of New York. These stores propose more of a threat to GNCs corporate stores rather than the franchises because of the personalized service. The franchise stores also have more leniency in determining the final price and any discounts or specials. With the addition of these new competitors and the threat that they pose the Company has maintained if not increased its market share in many markets. Competing Products and Services

GNC manufactures and sells several lines of supplements, vitamins and minerals, as well as a variety of health foods. These product lines carry many names. Some of these names include Preventative Nutrition, GNC, and Pro Performance. All of these lines are sold exclusively at GNC stores and at their online manufacturer. In addition to their own product lines, GNC stores carry a variety of products from third-party vendors. These third-party vendors include big names such as EAS (Experimental and Applied Sciences), Twinlab, Met-Rx, and Metaform.

All of these vendors are in the top 5% of sales for their flagship product. The Company must realize this and make their own products more attractive to the consumer. Competing products from the third-party vendors are also sold at other stores, so this forces the Company to not only compete within their own store but to also compete in the marketplace. New Technologies Today, many companies are facing the threat of the internet. Many companies are not used to this advanced technological system and do not have the resources to compete.

Not only is the Internet used for advertising purposes but it is also being used as an online ordering system. With the shift towards an online ordering system many things have to be taken into consideration and changed accordingly. The entire supply chain must be examined to identify any and all potential problems and differences that must be made as a result of this shift. In this case, the manufacture, supply, distribution, and information flow are critical and will inevitably be modified from the traditional way of supply the product to the retail centers.

Government Regulations Government regulations pose an enormous threat to the company. Potential government regulations will mandate FDA regulations and the testing of all products. This will dramatically increase the cost of production, which will ultimately be passed on to the end consumer. Some sport and diet supplements sold by the company today could be ruled illegal in the coming months if this occurs. This could potentially reduce the number of products available as well as the customer base. Increasing Customer Expectations

With the nations shift towards healthier living, many consumers have begun to experience unrealistic expectations of the products offered by the company. This can be witnessed by the fact that 45% of all adult Americans take some form of supplement. An attitude that many Americans exert today is that they want the pill or supplement to take the place of the work that they themselves would otherwise have to do. Customers are also looking for a company that offers exceptional customer service and sales associate knowledge. General Economic Conditions

With todays flourishing economy, the average Americans income is at an all time high. If anything would happen to cause a negative occurrence in the economy the average Americans disposable income would, as a result, probably decrease. This decrease in their disposable income would take away from their ability and/or desire to spend their money on products offered by GNC. The Different Cultural Ways of Host Countries The way that GNC handles their international business is through franchising. The franchising done internationally is done differently than is domestically.

During the international franchising process, the entire General Nutrition rights are sold to the franchisee for the entire country, not just an individual store as done domestically. The government regulations and culture differences or preferences are left to the discretion of the potential or existing franchisee. The threat is posed as a result of the lack of assistance and guidelines that would normally come from the corporation headquarters. As far as dealing with the individual host countrys government regulations and culture, it may discourage business in that country all together.

The availability of raw materials poses basically no threat to the company at this point because of their vast resources and long term contracts with their suppliers. But, in the future with the addition of many new entrants into the market a shortage of some raw materials and components may occur. General Nutrition was the pioneer of the nutrition industry and will continue to be for years to come. On of the major contributing factors to their success has been their ability to maximize their external opportunities.

Around the late 1980’s the average Americans active lifestyle had reached an all time low. With the 1990’s came the current trend of healthier living. It was at this time that consumers turned to GNC to help maintain a healthy lifestyle. GNC capitalized on this opportunity in several different ways. They began to change the typical consumers idea and preferences about the General Nutrition stores and products. They began advertising to all people and having specially trained employees with knowledge of all products that were carried.

This helped to make the store a more inviting place to everyone from a young high school athlete to a middle-aged mother of two. This also lead to new product market niches. Some of the more successful are the pro-performance line which is geared towards athletes, also the live well concept which promotes an overall healthy lifestyle which would be more suited for the average adult. With the change in customer preferences, GNC has the opportunity to increase market share by creating customer loyalty and trust through groundbreaking products.

General Nutrition has done a tremendous job on utilizing these opportunities and in order to remain atop the competition they must continue to fine tune the and analyze the business strategy. Definitely one of General Nutritions greater external opportunities is their franchising and long-term alliance with Rite Aid. This opportunity is so tremendous that along with 697 stores opened in 1998 they also signed an alliance with Rite Aid. The alliance with Rite Aid allows GNC to enter a new channel for marketing its supplements.

With a the average American only five miles away from a GNC, there still is such a demand for the stores that they plan to open an additional 250 stores in the next year alone. This combined with a total commitment to providing customer support has helped make GNC one of the most successful franchises for the past decade. To continue to capitalize on these external opportunities the company can look to actively pursue their franchising capabilities while avoiding cannibalization of existing stores to allow them to remain the pinnacle of the health food industry.

The main reason that GNC has been and will remain the world leader in the nutrition industry is due to their ability to use technology to receive great benefits. Their greatest areas of technology that set them apart from the rest are their manufacturing and distribution. This past year the company took a tremendous leap into the 21 century with the completion of a 630,000 square foot state of the art manufacturing facility in South Carolina. Along with the new manufacturing facility, the Company was involved in a recent merger with the Dutch pharmaceutical company Royal Numico.

This merger makes the Company the worlds largest manufacturer of vitamins and supplements. This merger presents the company with a great opportunity to take advantage of the world class research facilities available to them. The Company should streamline their supply chain to fully take advantage of the new manufacturing and distribution facilities. This will increase the Companys overall efficiency. The Company should look for a strategic alliance with an established online drugstore to broaden the Companys market share. This would also allow the Company to gain entry into the world of e-commerce.

Internal Strengths Internal strengths of the company include quality products emphasizing vitamins and minerals along with sports nutrition. This product mix focuses on high margin value added products, which are sold under the GNC proprietary brand. Along with vitamins, herbal, and sports supplements the Company also offers customers the opportunity the Gold Card program. This program enables stores to add to their product line. The basis for this program charges a $15 annual fee that entitles each member to a 20% discount on all products one time each month.

Sales of proprietary brands represented over 50% of total sales in 1998. Company reputation is another strength for the company. The Company is the only nationwide specialty retailer of vitamin, mineral supplement, sports nutrition products, and herbs. Along with these products the Company is also the leading provider of personal healthcare products. The companys reputation was built on two basic principles. The first of these is strong customer service. The Company has a strong competitive advantage over competitors because of well-trained and informed employees who have knowledge of the entire product line.

The Companys employees are knowledgeable and efficient because of the strong employee-training program. The second principal that has built their reputation is a superior product line. The proprietary brands along with other strong brand names enable them to have a product line better than the competitor. Production capabilities at the Company have enabled them to become the world leader in the their industry. The Company will be able to maintain their position as a leader because of their capacity to not only meet company inventory requirements, but also enough to sell to third parties in the wholesale market.

The Company is able to maintain strong production capabilities because of their emphasis on quality control. Each product is tested from the beginning to the end until the final product meets their standard. The Company has experienced a strong sense of executive leadership. The current president has 25 years of experience within the company and the CEO has 18 years. The executive vice president has 19 years of experience and the head of logistics has 22 years under his belt. Along with this experience it is evident to see that there is an extremely low employee turnover ratio within management.

Turnover within this company as with any retail organization occurs with retail store management and part time sales positions. To keep this factor at a low level the Company started the franchise program. The Company wanted to bring strategic partners into their system that would personally invest in the Companys program. Along with strong management leadership the Company maintains a strong employee base through orientation and hiring kits that enable the new employee to adjust quickly and become an efficient employee.

The company gives their employees the opportunity for tuition reimbursement, profit sharing, good medical and health benefits, and 401k and stock options. All of these factors allow a GNC employee to be part of a team. The Company uses patents to its advantage. By having patents on their proprietary formulas, vitamins, sports nutrition, and herbal supplements, the Company creates barriers between themselves and competitors. Along with their patents the Company conducts research with other companies. One such company is Proctor and Gamble.

Recently the Company has held the patent with Proctor and Gamble on calcium (calcium citrate malate). This product was found to be more absorbent than any other type of calcium. The Company achieves economies of scale throughout the entire organization and network of 5,000 retail stores by a close arrangement of entities. These include arrangements with product suppliers, raw materials, packaging material, store supplies, retail advertising, third party advertising, insurance coverage, and credit card processing.

The close surveillance and agreement of these entities allows the company to achieve greater economies of scale. The mission of the Company is to maintain quality over quantity in its products. The company typically introduces 25 to 30 new products each year and reformulates existing products on an annual basis. An annual reset is done for the stores to introduce new vendor third party products, and new company products through expansion and deletion of retail shelf space. Weaknesses General Nutrition Companies Incorporated is the leader in health products but the company is not adverse to risk.

These risks that we can find within the company are considered to be the weaknesses of the company. The first risk is that Royal Numico has acquired GNC, now being a part of a larger company they must now try to fit into the larger system and integrate themselves. With the integration of the Company into Royal Numico there will be a significant amount of cash spent, some potentially dilutive issuances of equity securities, incurrence of debt or amortization expenses, related to goodwill and other intangible assets. Any of these can adversely affect the company; its operating results and financial conditions.

In addition to the financial and operating factors we could find difficulties in the assimilation of the technologies, products and personnel of the integrated company. Another weakness that the company has is their leverage problem. This means that the company has raised much of its capital through debt financing, including loans. Based on the current level of operations and anticipated level of growth, the companys available cash flow, together with other sources of liquidity, will be adequate to meet to future needs of capital.

Although it looks to be enough, there can be no assurance that the company will generate enough cash flow. Along with that uncertainty our leverage could also have these important consequences: 1. Our ability to obtain additional financing for working capital, general corporate purposes could be impaired in the future. 2. A substantial portion of the companys cash flow from operations will be dedicated to the payment of interest. 3. Certain number of the companys borrowings will be at variable rates of interest, which will expose us to the risk of increased interest rates.

The companys leveraged financial position may make them more vulnerable to general economic conditions such as a downturn or recession. Along with all of the problems associated with being highly leveraged, the Company has the weakness that they will be affected by the general economic conditions in their markets. The companys results of operations are significantly affected by the overall economic trends of the companys principal geographic markets, the level of consumer spending and consumer confidence in future spending.

In periods of economic slowdown, the company could experience negative pressures on sales volume and declining margins for certain number of the companys products. A weakness that is faced by the company is that they could face product liability claims. Due to the nature of the products, it is possible that the company could be subject to individual or class action lawsuits based upon product liability laws. GNC, like other manufacturers or distributors of nutritional foods and supplements, face an inherent risk of exposure to product liability claims in the event that the use of the companys products results in personal injury.

Associated with the nutrition industry, the company is also faced with the weakness of having their products subject to regulation. The companys industry is subject to regulation by national and local governmental agencies. These regulations and laws govern such matters as production requirements, quality, trade and pricing practices, labeling, packaging and advertising. Although the company believes itself to be in compliance with current legislation, there are certain areas in the future in which they could have breaches. To maintain compliance the company will incur additional costs.

The biggest weakness facing GNC in the coming years is that the company faces the challenge of protecting their workers intellectual property. In the present to protect the companys intellectual property they rely on a combination of patent, trade secret, copyright and trademark laws. However, the company cannot guarantee that these measures will be adequate to prevent the companys competitors from copying or reverse-engineering the companys products. If this would happen the company is set-up to lose millions of dollars as well as the all important market share.

The Mattel Company

The Mattel Company, best known for its Barbie dolls, is the world’s largest toy maker. In March 1997, it acquired Tyco toys the third largest U. S. -based toy maker. Its product lines include Fisher-Price and Sesame Street preschool items, Disney-related products and Hot Wheel miniature vehicles. They type of industry Mattel is located under, is dolls and stuffed toys, although they have other types of products such as Hot Wheels. This company is under monopolistic competition. They sell their products in many stores, such as Toys R Us, KB Toys, K-Mart, Walmart, and others.

Some of Mattel’s competitors include Marvel Enterprises Inc. and Hasbro Inc. Marvel Enterprises (formerly Toy Biz) publishes comics based on more than 3,500 characters including Spider-Man, The Incredible Hulk, and the X-Men. The company, North America’s top comic publisher through its Marvel Entertainment subsidiary, also makes action figures, games, and puzzles based primarily on its Marvel characters. Hasbro is a worldwide leader in the design, manufacture and marketing of toys, games, interactive software, puzzles and infant products.

Included in its offerings are games, traditional board and card, hand-held electronic and interactive CD-ROM, and puzzles, preschool, boys’ action and girls’ toys, dolls, plush products and infant products. The company’s business activities include many things. The standards address a wide spectrum of issues, ranging from on-the-job concerns, such as factory lighting, air quality and health care facilities, to acceptable parameters for dormitories and recommendations for recreational programs. They serve as the principles by which Mattel’s internal and independent monitoring programs are measured around the world.

While the development of a code of conduct/manufacturing principles is essential to success, enforcement of the code is equally as important. Mattel has initiated an extensive three-stage auditing process, which is overseen by an independent monitoring council, to thoroughly inspect both the company’s owned-and-operated facilities around the world, as well as those of all core contractors. If a contractor facility is either unable or unwilling to work with Mattel in order to meet and maintain its standards, however, Mattel will discontinue the working relationship.

I think that the stock price rose due to the company flourishing. Mattel has many extraordinary products that have been around for years, and many more to come. This company seems very stable. They keep their customers happy and keep them coming back for more. Now that the holidays are coming near, I predict that the company will do very well and the stock will go up once again. The article “Mattel Appoints Two New Members of Senior Management Team” introduces the two new members, Bryan G. Stockton and Thomas A. Debrowski. Stockton has been named executive vice president of business planning and development.

Robert A. Eckert, chairman and chief executive officer of Mattel, Inc. believes that Stockton will, “provide Mattel with the clear, strategic thought required as we refocus on generating sustainable, profitable growth for Mattel” Bryan Stockton formerly served as president and chief executive officer at Basic vegetable Products. In his new position at Mattel, his primary responsibility is to identify and develop synergies throughout all cross-functional departments in order to support Mattel as a whole.

More elements of his function are the management of the company’s strategic planning, as well as supervising all merger and acquisition activity. Debrowski is appointed to executive vice president of worldwide operations. Eckert believes, “Tom will utilize his proficiencies in operations and manufacturing to ensure better management of the all-important supply chain. ” Debrowski was formerly the vice president and director of grocery operations for Kraft USA. At Mattel, Tom will be responsible for all worldwide manufacturing and distribution activities and eventually, he will be responsible for the entire supply chain.

Organizational Concepts – GreenPages, Inc

GreenPages, Inc. hereinafter referred to as GP is a dynamic organization that most closely fits the sociotechnical model put forth by Trist (1963) and Rice (1963) of the Tavis Institute. GP was created by Kurt Blieken in 1992 to be as he put it the most elegant company in existence today. Starting with a blank piece of paper Kurt Blieken crafted a mission statement (attachment A) that served as the underpinnings and catalyst to create an organizational structure that balanced the complex technical systems with a social and economic system which serves as a model to the computer industry today.

GP is currently under going tremendous growth of over 100% annually which creates a turbulent environment and tests the organization structure GP was founded on. It is the belief of Kurt Blieken as well as those of us whom work at GP that this unique corporate structure can not only be retained but thrive as the organization scales to new heights. In order to understand the goals and challenges facing GP it is useful to utilize Weisbord’s Six-Box Model to analyse the organizational structure. GP was formed with two purposes in mind. The first was to create the best place to work in the country.

The cornerstone of this purpose is a value system which is the very heart of our corporate culture. This value system is as follows: The company’s most valuable asset is its corporate culture. The basis of the culture is cheering at another’s success, helping out when a teammate needs a hand and being generous with praise. GP culture is so important that people who cannot or will not embrace it fully will not be allowed to stay. GP was designed from the ground up to meet the needs of our customers. We continuosly change and improve ourselves and our systems to meet new needs. Every job in the company is critically important.

We hire good people, then give the tools and the training to be outstanding. We are always striving for perfect execution of everything we do. It’s OK to make a mistake. Since we hire good people, a mistake is just that, a mistake. If many mistakes occur it is the system which needs to be corrected. Following this policy can be difficult but it leads to a wonderful lack of finger pointing and back covering. GP culture encourages new ideas and risk taking. Policies are initiated with the participation and input of the people doing the work. Everyone has to “buy in” to these policies.

Once policy is set, violation of that policy is unacceptable. The team structure provides the depth and flexibility to adapt quickly to change. This gives GP a huge advantage over their competitors which is demonstrated by the sales per employee of over 2. 5 million dollars annually. This amount is over 3 times that of the industry average and is a demonstration of efficiency throughout the organization. The team structure makes this possible by allowing the “flattest” possible corporate structure. Employees, vendors and customers are treated with honesty, respect and fairness. Every employee is responsible for living up to this standard.

It starts with how employees treat one another inside GP and extends to everyone GP comes in contact with. Violation of these standards by an employee or customer is not tolerated. If a customer promises “the check is in the mail” for instance and it never arrives on multiple occurances then GP will walk away and not do business with that customer even if it is profitable to do so. By having the highest level of integrity and demanding the same from GP customers and employees will allow the company to continue to grow at its current rate uninpeeded. Every GP employee is a stakeholder owning stock in the company.

Every employee at GP wants it to be the best place to work in the country. For this to be possible in each succeeding year GP must become more innovative, more profitable, more flexible and more energetic. While at the same time Gp must hold tight to its core values. The second purpose which provides the capital and revenue growth to achieve the first purpose is to facilitate the acquisition of technology on behalf of GP customers. GP does this by utilizing a large technical infrastructure with direct WAN (wide area network) links to every large computer distributor and manufacturer in the United States and Canada.

GP customers can make one call to their sales broker (a GP employee) and have instantaneous access to over 100,000 computer software and hardware products. Moreover, as a result of being on-line and in real-time with the major distributors and manufacturers GP can provide pricing and availability on the spot. Additionally GP can ship from over 400 warehouses throughout North America to insure the most expediant delivery of the product ordered. In order to understand the unique organizational structure please refer to the attached org chart.

Physically the building that GP ocuppies has four floors. Each floor has two sales teams. Additionally support teams including purchasing, credit, training, technical support & MIS (information systems) are dispersed among the four floors. There are some virtual teams or teams that don’t physically exist on any one floor but are comprised of various members of other teams who meet for a specific function. Some examples of virtual teams include the SST or senior support team that has the responsibility to strategically manage GP.

Task forces are the policy setting teams at GP and are comprised of employees who would like to participate or who are affected by the proposed policy. Every employee of GP is required to participate in at least one task force a year. Some examples of recent task forces include, compensation task force, new building and relocation task force, competitive task force, maternity task force, credit task force, as well as many others. Each team has a team leader whose responsibilities include housekeeping chores like keeping track of sick and vacation time or facilitating dispute resolution within the team.

Each floor has a coach who has more authority than the team leader and reports directly to the SST. Coaches review individual performance of each team member periodically and help facilitate resolution of interdepartmental disputes. Maintaining healthy positive relationships is paramount in making GP a great place to work. GP culture frowns heavily on gossip and/or derogatory statements made by one employee to or about another both internally or externally. GP has gone to great lengths to provide the proper context for healthy communication to occur.

 

Therefore everybody in the company is either a sales person with direct customer contact or supports the sales person and who’s success is directly related to the revenue produced in servicing the customers needs. All sales people are on 100% commission so they are highly motivated to work hard and generate sales. The support personel earn 75% of their pay in the form of a salary and the balance is tied directly to the success of the sales team the employee supports.

The company recognizes monthly the top sales people in each of several categories including highest revenue, most new customers, etc. Each sales team votes to recognize one support person per team that they felt performed above and beyond. Additionally, the company sets an annual threshold for Presidents Club which is typically the top 10% of all sales people in the company. As a Presidents Club member the employee is recognized for an entire year and a special week retreat with pay is provided to those top employees.

20th Century Insurance

20th Century Insurance was established in 1958 and was the first company of its kind to sell automobile insurance without a middleman, known in the industry as a broker or agent. This direct sales approach allowed 20th to offer insurance at a much lower premium than its competitors. To date, 20th Century Insurance is still recognized as one of the most economical full service automobile insurers in the California market. Position In terms of market share, 20th Century is the fifth-largest car insurer in the state.

The company’s credit rating was recently upgraded from a B- to BBB+ and its stock is being traded around $21. 50. 20th Century is also among the Valley’s (headquarters office location) largest firms in both market capitalization and employees. The company currently employs in over 2,000 people. Targeted market For the first 30 years of the company’s existence it enjoyed huge profits from selling only automobile insurance. These large profits were achieved, due in part, to its targeted market which are generally people in the age range of 30-60 who are classified as a low risk “good drivers”.

The company’s structure of selling insurance directly to the customer while providing excellent customer service is also a driving force to its success. In 1982 the company began offering homeowner’s insurance and this venture also proved to be financially successful for the company. The vast majority of the homes insured by 20th Century are located in the Valley cites and at one time the homeowner’s insurance made up about 10% of the company’s business, however, to date it only constitutes about 2%. Goals In 1994, 20th Century Insurance was a company on the rise.

It was a financially healthy company, reporting a total net of $734. 8 million in the preceding 35 years of operation. They were exploring plans to expand their business by selling insurance in other states such as, Arizona, Nevada and Oregon. The company was also looking at the idea of possibly changing the company’s name, in light of the newly approaching 21st Century. However, all its plans for growth were immediately put on hold due to the January 17, 1994, magnitude-6. 7, Northridge Earthquake that cost the company over $1,065 billion. The Northridge Earthquake

The Northridge Earthquake was recently characterized as one of this nations’ most costly disasters ever, as it has been 20th Century’s most costly and devastating in terms of its finances, reputation and survival. In the past five years since this catastrophic occurrence, 20th has encountered near financial ruin, class action lawsuits filed by homeowners, name smearing and accusations of illegal business dealings made to the press by their disgruntled claim’s manager and a near take-over of the company by their financial savior Automobile Insurance Group (AIG).

This series of events could have been described by many as a Public Relations nightmare for the company, instead, 20th chose to look at it as their biggest opportunity to do PR. Crisis Physically violent acts of God, such as an earthquake are often times both hard to predict and prepare for. 20th’s, Corporate Relations, Senior Vice President, Ric Hill, stated “The only way to see if your crisis plan works is to have a crisis. ” The mere concept of insurance is in some ways a form of personal crisis management for the individual insured. One must set things/plans in place to be prepared for all types of crisis.

Therefore, it stands to reason that an insurance company would have had a crisis plan for this type of occurrence. Though 20th did have a crisis management plan, there were many things that they had either overlooked or underestimated, such as the possibility that in a catastrophe their computer system might be in-operable thus rendering them incapable of verifying whether or not a claimant was actual covered for the loss, or that the previous estimation of the cost of an earthquake might be underestimated, causing the company to be underinsured.

Despite these perils, the company was able to make an almost full recovery in two years, which was three years less than the anticipated 5-year recovery plan. Their speedy recovery can be partly attributed to Chief Executive Officer, Neal Ashley and his team work philosophy. Ashley states that “During a crisis is when you need people the most, because you need action (s) to be taken”. 20th’s focus throughout this ordeal was customer service.

During this period there were few customer complaints. Corporate Relations VP, Ric Hill stated that, “I’ve seen many companies survive all types of calamities, but very few companies survive poor service”. Comeback Kid-PR Campaign Five years later the company has made a full recovery and is now known as the Comeback Kid. Therefore their new PR strategy should be to focus on the future. That concept can begin with the re-visiting of the company’s name change.

It would be important to conduct some cross-section test marketing to assure that the name change will not be perceived by the company’s publics as an effort to hide from what has occurred. It is in the company’s best interest to legitimately put the past behind it and then move forward. Another PR tactic is to remain focused on the positive, by producing a continuum of information about the company’s profit margin, increased credit rating and stock dividends paid to stock holders.

This obviously will show the strength of the company, therefore enticing more people to invest. With more investments the company can push forward with its previous plans to expand its business in the states of Nevada, Arizona and Oregon. Regular marketing and advertisement can now be resume. Through a demographics study, it has been proven that many people from California have re-located to these targeted states and therefore 20th’s advertisement should be increased to provide name recognition for those individuals who are or will be re-locating.

Major Case Presentation 20th Century Insurance Company

20th Century Insurance was established in 1958 and was the first company of its kind to sell automobile insurance without a middleman, known in the industry as a broker or agent. This direct sales approach allowed 20th to offer insurance at a much lower premium than its competitors. To date, 20th Century Insurance is still recognized as one of the most economical full service automobile insurers in the California market. Position In terms of market share, 20th Century is the fifth-largest car insurer in the state.

The company’s credit rating was recently upgraded from a B- to BBB+ and its stock is being traded around $21. 50. 20th Century is also among the Valley’s (headquarters office location) largest firms in both market capitalization and employees. The company currently employs in over 2,000 people. Targeted market For the first 30 years of the company’s existence it enjoyed huge profits from selling only automobile insurance. These large profits were achieved, due in part, to its targeted market which are generally people in the age range of 30-60 who are classified as a low risk “good drivers”.

The company’s structure of selling insurance directly to the customer while providing excellent customer service is also a driving force to its success. In 1982 the company began offering homeowner’s insurance and this venture also proved to be financially successful for the company. The vast majority of the homes insured by 20th Century are located in the Valley cites and at one time the homeowner’s insurance made up about 10% of the company’s business, however, to date it only constitutes about 2%. Goals In 1994, 20th Century Insurance was a company on the rise.

It was a financially healthy company, reporting a total net of $734. 8 million in the preceding 35 years of operation. They were exploring plans to expand their business by selling insurance in other states such as, Arizona, Nevada and Oregon. The company was also looking at the idea of possibly changing the company’s name, in light of the newly approaching 21st Century. However, all its plans for growth were immediately put on hold due to the January 17, 1994, magnitude-6. 7, Northridge Earthquake that cost the company over $1,065 billion.

The Northridge Earthquake was recently characterized as one of this nations’ most costly disasters ever, as it has been 20th Century’s most costly and devastating in terms of its finances, reputation and survival. In the past five years since this catastrophic occurrence, 20th has encountered near financial ruin, class action lawsuits filed by homeowners, name smearing and accusations of illegal business dealings made to the press by their disgruntled claim’s manager and a near take-over of the company by their financial savior Automobile Insurance Group (AIG).

This series of events could have been described by many as a Public Relations nightmare for the company, instead, 20th chose to look at it as their biggest opportunity to do PR. Crisis Physically violent acts of God, such as an earthquake are often times both hard to predict and prepare for. 20th’s, Corporate Relations, Senior Vice President, Ric Hill, stated “The only way to see if your crisis plan works is to have a crisis. ” The mere concept of insurance is in some ways a form of personal crisis management for the individual insured. One must set things/plans in place to be prepared for all types of crisis.

Therefore, it stands to reason that an insurance company would have had a crisis plan for this type of occurrence. Though 20th did have a crisis management plan, there were many things that they had either overlooked or underestimated, such as the possibility that in a catastrophe their computer system might be in-operable thus rendering them incapable of verifying whether or not a claimant was actual covered for the loss, or that the previous estimation of the cost of an earthquake might be underestimated, causing the company to be underinsured.

Despite these perils, the company was able to make an almost full recovery in two years, which was three years less than the anticipated 5-year recovery plan. Their speedy recovery can be partly attributed to Chief Executive Officer, Neal Ashley and his team work philosophy. Ashley states that “During a crisis is when you need people the most, because you need action (s) to be taken”. 20th’s focus throughout this ordeal was customer service.

During this period there were few customer complaints. Corporate Relations VP, Ric Hill stated that, “I’ve seen many companies survive all types of calamities, but very few companies survive poor service”. Comeback Kid-PR Campaign Five years later the company has made a full recovery and is now known as the Comeback Kid. Therefore their new PR strategy should be to focus on the future. That concept can begin with the re-visiting of the company’s name change.

It would be important to conduct some cross-section test marketing to assure that the name change will not be perceived by the company’s publics as an effort to hide from what has occurred. It is in the company’s best interest to legitimately put the past behind it and then move forward. Another PR tactic is to remain focused on the positive, by producing a continuum of information about the company’s profit margin, increased credit rating and stock dividends paid to stock holders.

This obviously will show the strength of the company, therefore enticing more people to invest. With more investments the company can push forward with its previous plans to expand its business in the states of Nevada, Arizona and Oregon. Regular marketing and advertisement can now be resume. Through a demographics study, it has been proven that many people from California have re-located to these targeted states and therefore 20th’s advertisement should be increased to provide name recognition for those individuals who are or will be re-locating.

Rica Cheesecake & Coffee Company

Imagine sitting at a trendy and relaxing cafe in the middle of a dynamic and energetic town square, in Latin America, enjoying a cup of fine coffee with a slice of delicious American style cheesecake. You have just entered the world of Rica Cheesecake and Coffee Company. Our team was tasked with developing a concept or service in a foreign country and delivering a research project. The key to this project was selecting the country and a product that would have the greatest chance of success.

We focused on the Central American region of the world. We evaluated the seven countries that comprise Central America and chose one country with the most potential to deliver our product. The countries that were evaluated were; Guatemala, Belize, El Salvador, Honduras, Nicaragua, Panama and Costa Rica. As you can gather from our name of our concept, we have selected Costa Rica. Each country was evaluated by the geographic, cultural, political, infrastructure, economic and overall risk to determine the optimum country.

The countries in Central America had similar characteristics, from their religious beliefs to their “Metizo” population. They also depend on agriculture and tourism for their economies. Central America is plagued with political corruption, economic challenges and a continued drug trafficking problem. One thing that these countries do have is the abundance of natural resources, fertile land, water and wonderful weather.

This is what drives thousands of tourists to this part of the world. We found that a large number of U. S. itizens vacation in Central America, especially in Costa Rica, in fact, they like it so much, they retire there. We have developed our concept with these and may other demographics in mind. In an effort to attract customers and create a competitive advantage, we will commit ourselves to a differentiated product/service strategy and will differentiate ourselves based on customer service, product quality and product uniqueness. Our start-up strategy is to establish a joint venture with the well regarded coffee company, Aventura Ltd.

This will help reduce our initial capital investment and help minimize risks associated with Greenfield operations. By establishing a joint venture we are able to recognize synergistic transfers of product knowledge, this adds more value to our company and our product which ultimately can be passed on to our consumers. Now it is time to imagine the “American” style cheesecake, with a touch of local flavor in coffee. So sit back and relax and enjoy the experience.

With these assessments we are now able to introduce Costa Rica. The next section of this paper will provide a more detailed analysis of Costa Rica in order to illustrate our selection. The first section will detail the Geographic, Social, Economic, Political, and Infrastructural elements of Costa Rica. The subsequent section will then discuss the Business environment in detail. Costa Rica Geographic: Costa Rica is located in Central America between Nicaragua and Panama, bordering both the Caribbean Sea and the North Pacific Ocean, between Nicaragua and Panama.

The climate is tropical and subtropical with a dry season from December to April and a rainy season from May to November. The terrain consists of coastal plains separated by rugged mountains including several major volcanoes. Costa Rica has occasional earthquakes, hurricanes along the Atlantic coast; frequent flooding of lowlands in the rainy season and landslides and the potential for volcanic activity (CIA 2004). Social: The estimated population of Costa Rica as of July 2004 was 3. 9 million people with the largest segment of the population being 15-64 year-olds at 65 percent of the population.

The estimated population growth rate in 2003 was 1. 52 percent per year. The estimated 2003 unemployment rate was 6. 7%, with an inflation rate of 9. 4%. This is based on a labor force of approximately 1. 758 million (CIA, 2004). In Costa Rica a person is considered literate if they can read and write by the age of 15. The official literacy rate for the total population ages 15 and over is 96 percent, proportioned equally between males and females (CIA 2004). The major ethnic group in Costa Rica is white, including “mestizo,” the mixture of Europeans (Spanish) and Indian ancestry (Amerindians), totaling 94 percent of the population.

The other ethnic groups represented are three percent black, one percent Amerindian, one percent Chinese and one percent other. The official language of the Costa Rican people is Spanish with some English spoken. The Roman Catholic religion is the strongest at 76. 3 percent of the population with Evangelical at 13. 7 (CIA 2004). Costa Ricans are profoundly self-conscious of their self-image, which drives their behaviors of the individuals, as well as the nation. The behavior is focused on humility. Costa Ricans are unique because of their “whiteness” and the lack of an indigenous culture.

Identity, 2004) These cultural characteristics offer a unique differentiation that should be taken into account when determining product or service needs of the Costa Rican people. Issues of pride and self-esteem can affect the types and quality of products people are willing to use or purchase. The culture is traditional and conservative. Women are playing an increasing role in business and government. This transition could affect the way one markets to this group. Costa Rica is steeped in religious celebrations. These celebrations are focused around families.

Costa Rica celebrates Easter Week or Semana Santa, Christmas Week and August second, which is the celebration of the Virgin of the Angels. “Costa Rica is also different from other Latin American countries, because it practices a “lukewarm” Catholicism that causes a strange mixture of partying and religious celebration during these holidays” (Culture, 2004). POLITICAL: The Costa Rican government is considered a democratic republic. There are seven provinces, Alajuela, Cartago, Guanacaste, Heredia, Limon, Puntarenas, and San Jose. They achieved their independence from Spain on September 15, 1821, which is now their national holiday.

The Constitution of November 7, 1949 is based on the Spanish civil law system with judicial review of legislative acts in the Supreme Court. Similar to the United States, the governing parties consist of the Executive, Legislative and Judicial branches. Costa Rica maintains diplomatic representation both in the United States and has a United States diplomatic representative located in Costa Rica. Costa Rica is a member of many international organizations including the United Nations, the World Bank and the World Trade Organization.

According to the Economist Intelligence Unit, 2004, Costa Rica’s political risk is rated at a “B. ” ECONOMIC: Costa Rica’s main industries are tourism, agriculture and electronics exports. They produce agricultural products such as bananas, sugar, pineapples and coffee and manufacture medical equipment and electronic components. But by far, tourism is their main economic driver. This is derived by a significant amount of FDI into the tourism industry (Tourism, 2004).

Costa Rica’s exports in 2003 totaled $6. illion, while their imports of raw material, consumer goods, capital equipment, and petroleum totaled $7 billion (CIA, 2004). Costa Rica’s number one top trading partner in both imports and exports is the United States at over 29 percent exported to the U. S. and 35. 4 percent imported from the U. S. The other major trading partner countries include Japan, Netherlands and Mexico (CIA, 2004). Costa Rica’s economy is stable with heavy reliance on the tourism industry. They have been successful in reducing the level of poverty over the past 15 years and they have created a “strong social safety net.

Some of the issues that Costa Rica has been facing are the low prices for their agricultural products such as coffee and bananas, as well as the large deficit and internal debt. They are concerned about reducing inflation. There is also a concern because the cost of imports is rising. Costa Rica has agreed to terms with the US over the Central American Free-Trade Agreement (CAFTA) in January 2004, Costa Rica joined its Central American counterparts Guatemala, El Salvador, Honduras and Nicaragua in signing the agreement.

The US is unlikely to ratify it before November’s presidential and congressional elections (EIU, 2004). Costa Rica has had an increasing GDP, in 2003, their GDP grew 5. 6%. The sectors that account for the growth were agriculture, at 8. 5%, Industry, 29. 4% and Services at 62. 1%. The industries consist of microprocessors, food processing, textiles and clothing, construction materials, fertilizers and plastic products (CIA, 2004). INFRASTRUCTURE: Costa Rica has a significant number of airports, waterways, railways, highways and many ports and harbors.

According to the CIA World Fact Book, Costa Rica has approximately 30 paved airports and 119 unpaved airports. There is also approximately 950 kilometers in the rail system. There is a significant roadway system in Costa Rica with approximately 35,982 miles of highway of which 7,896 are paved and 227,996 are unpaved. According to the CIA World Fact Book, Costa Rica’s communication infrastructure is state-owned.

The country has a good working system in place with approximately 1. illion lines in use. There are approximately 528 thousand cell phones. The broadcast infrastructure in Costa Rica consists of 20 TV broadcast stations and 65 AM and 51 FM radio stations. Business Environment in Costa Rica Openness to Foreign Investment Costa Rica gives a lot of importance to the influx of foreign investment into the country. The UNCTAD in its 2002 World Investment Report classified Costa Rica as one of the six most successful countries in the attraction of the FDI.

The Costa Rican Government welcomes foreign direct investments in the country and consistent efforts have been made in this area by Ministry of Foreign Trade (COMEX) and the Costa Rican Coalition for Development Initiatives (CINDE), a private non-profit association originally created in 1982. Costa Rica’s cost of living is low and the quality of life is the highest among the Central American nations. Its strategic location between the America’s and its duty free access to the US has been the greatest contributing factors attracting investment in Costa Rica.

Costa Rica has an educated, motivated and productive workforce but the operating costs are very low. The country’s economic and political stability have created a stable and friendly business environment. Costa Rica has 8 free Trade Zones which offer many incentives to investors. The Foreign Trade Zones (FTZ) provides investors exemption from taxes on corporate profits, dividends, municipal taxes, import duties and sales taxes. The procedures and regulations for investment, trade and customs are fairly simplified and easy.

Thus the operating risk becomes very low. The high quality infrastructure offers Costa Rica wide connectivity with the world. These factors have facilitated foreign direct investment in Costa Rica. International Investment Agreements Costa Rica has duty free access to U. S through the Caribbean Basin Initiative and has very good relations with them. It has bilateral investment treaties with several Latin American and European countries like Mexico, Chile, Panama, Trinidad, Tobago, Venezuela, Argentina and France, Germany, Spain, Switzerland and others.

It is also negotiating with Canada and Dominican Republic. Costa Rica is currently involved in the CAFTA negotiation. Currency Conversion and Transfer Policies The Costa Rican currency is called the Colon. 100 centimos make a Colon. Smaller denomination coins are not much in use but 25 or 50 centimo coins are in circulation. The foreign currency exchange system allows free possession and conversion of foreign currency into local currency and vice versa, through banks and financial institutions. The US dollar is the best known foreign currency and is easily convertible.

The rate of exchange is Currency other than US$ can be exchanged only with difficulty. Canadian dollars and British Sterling can be exchanged at Banco Lyon, C. 2, Av. Central. Canadian dollars can also be exchanged at Banex, C. Central, Av. 1. German currency can be exchanged at the Banco Nacional inn San Jose. The black market for exchanging money does unofficially exist in San Jose, the capital city. There are no limitations or restrictions on transfer of funds associated with investments, in any available currency, at a legal market rate.

No restrictions are imposed on reinvestments or on the repatriation of earnings, royalties, or capital except when these rights are covered in contractual agreements with the government of Costa Rica. Banking and Capital Market Costa Rica’s banking system comprises of The Central Bank responsible for the monetary and foreign exchange policies, three state-owned commercial banks namely: Banco Credito Agricola de Cartago, Banco de Costa Rica, Banco Nacional de Costa Rica, twenty private banks and two service banks: BANHVI and Banco Popular.

Costa Rica has more than seventy financial institutions. Other international banks doing business in Costa Rica are: Citibank, Scotia Bank and other regional banks such as Bancrecen and Cuzcatlan. Current interest rates range from 12% to 15% in dollars and between 25% to 29% in colons. Financing real estate in Costa Rica is not easy. Only residents are provided loans from banks. Banks traditionally do not loan money to foreigners for the acquisition of fee-simple properties, unless they are residents.

Foreigners who have legal residency generally qualify for bank loans if they can provide evidence of a job and adequate income. The National Stock Exchange, (“Bolsa Nacional de Valores”), Costa Rica, was the first to open in Central America. It started its operations in 1976 and since then the trading activities have grown full fledged. Trading is done mainly on government securities. Insurance The National Insurance Institute is the primary insurance agency in Costa Rica and it is one of the largest insurers in Central America. The agency is state-owned and enjoys a monopoly in the region.

The National Insurance Institute offers policies covering most types of insurable interests (e. g. , fire, earthquake, automobile, crops, life, medical, occupational risk, flood, avalanche, professional liability etc. ). Insurance with foreign companies is allowed but under certain limitations. Expropriation and Compensation Article 45 of the constitution of Costa Rica, states that no property can be expropriated from a Costa Rican or foreigner by the government without full and advance payments and without any justifiable proof of public interest.

If the property is not used by the government for some public purpose, it has to be returned to the owner at the current market value. Dispute Settlement Costa Rican Courts offer a fair and adequate system of resolution of disputes which is ranked as the best in Central America. Costa Rican Constitution has recognized every person’s right to settle disputes through the use of arbitration. Costa Rican courts sometimes take years to settle disputes and hence people have access to other alternative ways. For settlement of local arbitrage people approach lawyers and arbitrators.

Majority of the disputes involve expropriations. Taxation Taxation in Costa Rica is much more simplified than that of many other countries. There are different limits of taxation depending on your income: the more you earn, the more you pay; if you earn less than the minimum amount established by Costa Rican law, you pay no taxes. In Costa Rica, the tax year begins in October 1 and ends September 30, both for individuals and corporations. Under the Costa Rica tax system, residents and corporations are taxed only income earned in Costa Rica or from Costa Rican sources.

Costa Rican Laws do not tax income derived from a foreign source. Income earned from real estate transactions, from assets, goods and rights invested or used in Costa Rica or from commercial, and industrial, agricultural and any other trade or business activities carried out within the country is subject to tax. Sales tax is 13% on the amount paid for goods and services. A municipality tax of 0. 25% is charged on real estate. A transfer tax of 1. 5% of the real value of the property or the value registered with the tax authorities, whichever is higher, is paid.

Stamp taxes are levied on legal documents and an Education and Culture statutory stamp tax is assessed on all business entities. Individuals are subject to a progressive tax schedule and nonresidents, either employed or self-employed, are subject to a flat 15% withholding tax, on all income derived from personal services performed in Costa Rica and are not required to file income tax returns in Costa Rica. Self-employed nonresidents receiving rental or business income must file an annual tax return and are subject to the Self-employment Progressive Tax Rate schedule.

Import Duties According to the Central American Customs System Book (SAC), each type of good has a number or classification for customs purposes, and the rates vary accordingly. Import duties are normally subject to a maximum of 20% and a base of 5%. Certain luxury items are charged almost 100% duties on the value of these goods. Among the highest taxed items are arms and ammunitions (75 percent), costume jewelry (50 percent), fireworks (50 percent), whiskey (50 percent) and wine and beer (40 percent).

A one percent surcharge is imposed on most imports, except medicines and raw materials for human consumption and industry. Tax Incentives Companies established in the Free Trade Zone are offered some incentives: 100% exemption from all exports and re-exports of equipment and machinery, 100% exemption from sales and consumer taxes levied on remittances abroad, 100% exemption on import duties on raw materials, components and capital goods, 100% exemption on taxes on profits for 8 years, and 50% for the following 4 years.

The government offers job bonuses and subsidized training programs for labor. Protection of Property Rights Protection of intellectual property rights is among the best in Latin America, although it is highly inefficient with regards to other nations in the world. Secured interests in both chattel and real property are recognized and enforced, and mortgage and title recording is required by law. Proper care must be taken with regards to title of property as there is always fear of squatter invasions and encroachments.

Delayed judicial proceedings and lack of efficiency on the part of judges specializing in intellectual property enforcements have caused problems in the business software industry. The government has taken steps to improve intellectual property rights (IPR) enforcement and bring its copyright laws into compliance with TRIPS. Right to Private Ownership In matters of land and property ownership, foreigners and Costa Rican citizens have equal rights under the law. Foreigners do not have to live in Costa Rica to own property.

One can own and manage a business in most areas except those that are owned and operated by the government. Foreign companies can set up branches, wholly owned subsidiaries or locally incorporated companies in Costa Rica and can fully own them without appointing Costa Ricans as shareholders. There are certain sectors that are reserved for the state and that require Costa Rican citizenship or residency like electrical power, broadcasting, beachfront property, professional services and wholesale distribution. No private ownership of beachfront property is allowed.

The Costa Rican government owns the first 200 meters of the beach front area, known as the Zona Maritimo Terrestre, or the Maritime Zone. There can be no construction on the first 50 meters of the beach property, but investors may lease the next 150 meters, provided they are a part of a special zoning district. Labor and Regulations Costa Rican labor force is well educated, skilled and motivated. It is known for its efficiency and productivity. Costa Rica has the highest United Nations’ Human Development Index among developing nations and the highest literacy rate among the Central American nations (96%).

This is mainly owing to the subsidized education offered by the government. The National Vocational Training Institute (INA) and private-sector groups provide technical and vocational training to the people of Costa Rica. Costa Rica has a vast pool of professionals probably the largest in Central America. Costa Rica has a number of registered engineers with foreign work experience. It has also many registered medical doctors, dentists, and oral surgeons. Labor related issues are governed by the 1943 Labor Code (Codigo de Trabajo).

These issues include salaries, working conditions, hours of work and overtime, labor disputes and many other such related issues. Labor Courts throughout the country must comply with the code. The National Wage Council states the minimum wage rates for private and public sectors twice a year. According to the code all workers are entitled to a two-week paid vacation and a Christmas bonus equal to one month’s salary on completion of one year of employment, every year. Women are entitled to four months of maternity leave.

The Hourly daily wage rate for non-Qualified workers including benefits is $1. 34 and for qualified workers is $1. 54. For a specialized worker it is $ 1. 85. Overtime rate is hourly rate plus 50%. Thus we can see how cheap the labor in Costa Rica is. Costa Rican Labor Laws require employment contracts between the employer and the employee. All employers must hold an insurance policy with the National Insurance Institute to cover occupational risks. The Employee Protection Act requires the employer to create a contribution of 3% on the employee’s monthly salary.

Foreign nationals without residency status or labor permits are not allowed to work in Costa Rica. According to the labor code 90% of the workers in a country must be Costa Ricans and foreigners cannot occupy jobs for which Costa Ricans are available. Certain flexibilities are provided on request. From this detailed examination of the geographic, social, economic, political, and infrastructural elements of Costa Rica as well as its business environment/climate we were able to construct our business concept, and financing so to reduce most costs associated with barriers of entry.

Costa Rica as such has no significant trade barriers affecting entry of goods and services. Costa Rica has agreed in its Uruguay Round of talks to eliminate all import quotas and reduce tariffs significantly to enhance its trade relations with the U. S as well as the Central American nations and Latin American nations. However, there are certain barriers in the investment and service sector. see exhibit 4 for a detailed examination of potential barriers of entry.

Company Insights on BP

On August 30, we all chose 5 stocks to evaluate before purchasing. At this time I chose BP AMOCO, Microsoft, Western Digital, Toys-R-Us, and Fortune Financial Incorporated. After a few weeks of tracking these stocks, I chose to keep BP AMOCO, Microsoft, and Western Digital, because the stocks were relatively stable and most of them were on the rise at this time. As you are aware, we were given $30,000. 00 to invest in our three chosen stocks, which breaks down to $10,000. 00 per stock. We also had to include a brokers fee of $500. 00 for every $10,000. 00 invested.

My first stock was BP AMOCO. On September 8, I purchased 167 shares at $57. 6 per share, which totaled $9,523. 00 and incurred a $476. 15 brokers fee, making the grand total spent $9,999. 15. BP is one of Britains biggest companies and one of the worlds largest oil and petrochemical groups. Its origin dates back to May 1901. BP owes its origin to one man, William Knox DArcy, a wealthy Englishman, who obtained concession from the Muz-affaru’d-Din, Shah of Persia (1896-1907) to explore and exploit the oil resources of the country, excluding the five northern providences that bordered Russia.

He, shortly after the turn of the century, invested time, money and labor in the belief that worthwhile deposits f oil could be found in Persia, which is now known as Iran. Having been granted the concession; DArcy employed an engineer, George Reynolds, to undertake the task of exploring for oil in Persia. For seven years, Mr. D’Arcy battled with severe weather, the absence of a developed infrastructure, the shortage of skilled local labor, the problems of dealing with neighboring tribes in the absence of a strong central government, difficult terrain, and an uncertain political situation.

These conditions made Reynolds pioneering task an exceptionally difficult venture. Meanwhile, the osts mounted stretching DArcys resources to the point where e sought outside financial assistance. This came in 1905 from the Burmah Oil Company, which provided new funds for his venture. More exploration in Persia followed without success, until eventually, in May of 1908, Reynolds and his helpers struck oil in commercial quantities at Masjid-i-Suleiman in southwest Persia.

It was the first commercial oil discovery in the Middle East, signaling the emergence of that region as an oil producing area. After the discovery had been made, the Anglo-Persian Oil Company was formed in 1909 to develop the oilfield and work the concessions. At the top of Anglo-Persians formation, Burmah Oil Company owned 97 percent of its ordinary shares. Lord Strathcona, the companys first chairman, owned the rest. Although D’Arcy was appointed a director and remained on the board until his death in 1917, he was not to play a major part in the new company’s affairs.

His role as the initial risk-taking investor was past and the daunting task of developing the oil discovery into a commercial enterprise shifted to others, amongst whom one stands out: Charles (later Sir Charles, then Lord) Greenway. Greenway was one of Anglo-Persian’s founder-directors, becoming managing irector in 1910 and chairman, after Strathcona, in 1914. Greenway, anxious to avoid falling under the domination of Royal Dutch-Shell, also turned to another potential source of revenue and capital: the British government.

The basis of an agreement to mutual advantage lay in Greenway’s desire to find new capital and an outlet for Anglo-Persian’s fuel oil; and, on the government’s part, in the desire by the Admiralty (then headed by Winston Churchill as First Lord) to obtain secure supplies of fuel oil, which had advantages over coal as a fuel, for the ships of the Royal Navy. After lengthy negotiations, an agreement was reached in 1914 shortly before the outbreak of World War I.

Anglo-Persian contracted to supply the Admiralty with fuel oil and the government injected $2 million of new capital into the company, receiving in return a majority shareholding and the right to appoint two directors to Anglo-Persian’s board. Although the government undertook not to interfere in Anglo-Persian’s normal commercial operations, its shareholding introduced an unusual political dimension to the company’s affairs. In later years, the government shareholding was reduced and — apart from a tiny residual holding — ended in 1987. Further expansion followed in the decade after World War I.

New marketing methods were introduced, with curbside pumps replacing two-gallon tins for the distribution of motor spirit (or, gasoline). Anglo-Persian also marketed its products in Iran and Iraq; it established an international chain of marine bunkering stations, and in 1926 began to market aviation spirit. New refineries, much smaller than the plant at Abadan, also came on stream — at Llandarcy in South Wales in 1921 and at Grangemouth in Scotland in 1924. Moreover, the company’s majority-owned French associate had a refinery at Courchelettes, near Douai.

On the other side of the world, in Australia, a new refinery at Laverton, near Melbourne, was commissioned in 1924. Exploration was carried out not only in the Middle East, but also in other areas, such as Canada, South America, Africa, Papua and Europe. By the time Greenway retired as chairman in March 1927, he had realized his main strategic goal of establishing Anglo-Persian as one of the world’s largest oil companies, with a substantial presence in all phases of the industry. In 1935, the company was renamed the Anglo-Iranian Oil Company. During the post-war reconstruction of Europe, the high demand for oil enabled

Anglo-Iranian to expand its business greatly. The company’s sales, profits, capital expenditure and employment all rose to record levels in the late 1940s. The refinery at Abadan was by this time the largest in the world. Moreover, crude oil production from the company’s Iranian oilfields kept Iran at the top of the league of Middle East oil producing countries. Meanwhile, Anglo-Iranian entered the field of petrochemicals. An agreement with the Distillers Company in 1947 resulted in the formation of a joint company, later to become known as British Hydrocarbon Chemicals, which produced asic materials from naphtha at Grangemouth.

A second petrochemical complex was built at Baglan Bay in South Wales in 1961. While the company was expanding its operations in the late 1940s, it was also engaged in talks with the Iranian government about the terms of its oil concession. Long and complex negotiations failed to produce an agreement, and in 1951 the Iranian government passed legislation nationalizing the company’s assets in Iran, then Britain’s largest single overseas investment. The nationalization precipitated a major international crisis in which the British nd US governments became deeply involved.

The company’s operations in Iran were brought to a halt. Only after three years of intensive negotiations was the crisis resolved by the formation of a consortium of oil companies, which, by agreement with the Iranian government, re-started the Iranian oil industry in 1954. Anglo-Iranian — which was renamed The British Petroleum Company in 1954 — held a 40 percent share in the consortium. One of the effects of the Iranian nationalization crisis was that the company was forced to broaden its operations to make good the loss of oil supplies from Iran, on which it had depended.

Crude oil production in other countries, notably Kuwait and Iraq, was greatly increased; and new refineries were built in Europe, Australia and Aden. In another development, in 1952, the company commissioned its first lubricating oils plant at Dunkirk. Two years later, it began marketing BP Visco-Static, Europe’s first multi-grade-oil. Although all of these events were important for the company, it was hydrocarbons under the North Sea and under the permafrost of Alaska that were to play the key role in transforming BP into the company it is today.

Earlier, in 959, the Dutch had discovered a giant gas field on the edge of the North Sea at Groningen. This discovery encouraged others to begin searching for hydrocarbons offshore. BP scored the first success in British waters when, in 1965, it found the West Sole gas field, which it brought on stream two years later. The search for oil spread farther north, and in 1970 BP discovered the Forties field — the first major commercial find in the UK sector. Meanwhile, in Alaska, BP was rewarded for ten years’ exploration effort when, in 1969, it announced a major oil discovery at Prudhoe Bay on the North Slope.

When it became clear that, through its large share in Prudhoe Bay, BP owned part of the biggest oilfield in the USA, the company decided that its Alaskan oil could best be handled by a well-established US refining and marketing company. Accordingly, it signed an agreement with the Standard Oil Company of Ohio in August 1969. This company, the original John D. Rockefeller Standard Oil, was the market leader in Ohio and was strongly represented in neighboring states. Under the agreement, which became effective from 1st January 1970, Standard took over BP’s leases at Prudhoe Bay and some East Coast downstream assets that

BP had acquired in 1968. In return, BP acquired 25 percent of Standard’s equity, a stake that would rise to a majority holding in 1978 when Standard’s share of Alaskan production passed 600,000 barrels a day. The 1970s were the decade of the two great oil price shocks (1973 and 1979/80) that were to have serious effects on the world’s economies. It was also a decade when the major oil companies saw a decisive change in their old concessionaire relationships. Like its major competitors, BP lost direct access to most of its supplies of OPEC oil as the OPEC countries took control of production and prices.

Resource Based View of the Firm

In the article, the authors introduce a new approach to strategic management called the “Resource Based View of the Firm” – RVB. RVB attempts to develop a business model framework that helps describe how a company’s resources drive its performance in a dynamic competitive environment. This approach integrates the internal analysis of the company (i. e. core competencies) with the external analysis of the industry and the competitive environment (i. e. Porter’s Five Force Model). The article argues that both analyses are required to accurately assess a company’s competitive position.

While Porter’s Five Forces Model helped strategic managers choose the right industries and, within them, the most attractive competitive positions, it did not place a high enough emphasis on a company’s core competencies. The emphasis in the model was clearly on the phenomena at the industry level. Likewise, the core competencies approach emphasized the importance both of the skills and collective learning embedded in an organization, but little emphasis was placed on the external environment.

From Prahalad’s article titled “The Core Competence of the Corporation”, core competencies entail the collective learning in an organization and how diverse production skills and multiple streams of technologies are integrated. Core competence involves communication, involvement and a deep commitment to work across organizational boundaries. He argues that core competence does not diminish with use, unlike physical assets. He also argues that roots of competitive advantage arise from within the organization and that new strategies and improved competitive positioning are only constrained by the current level of the company’s resources.

Herein lies the key differences in the analyses carried out by Prahalad and Collis. Collis first argues that core competencies cannot be evaluated in isolation, because their value is determined in the context of the present market forces. In order to accurately assess a company’s competitive strength, one must analyze a company’s specific resources (i. e. physical and intangible assets) and capabilities in the context of the competitive environment. Furthermore, Collis argues that core competencies do erode over time and by competition and that continuous reinvestment is required.

A closer analysis of these tests shows that RVB is an extension of the Prahalad’s three tests for identifying core competencies with the added consideration of the effects of market competition, as described in Porter’s Five Forces Model. Prahalad’s three tests involves the following: 1) provides potential access to a wide variety of markets, 2) makes a significant contribution to the perceived customer benefits of the end product and 3) should be difficult for competitors to imitate. Both Prahalad and Collis argue that core competencies need to be leveraged across functional divisions within an organization (i. . SBUs) and that management needs to have the oversight to identify leveraging opportunities.

RVB emphasizes that the value of distinctive competence erodes over time and by competition. In a market of continuous change, organizations need to maintain the pressure of constantly developing and reinvesting into the right distinctive competencies, preparing for the next round of competition. However, it is critical that organizations invest in core competencies while at the same time examine the competitive dynamics that determine industry attractiveness.

An example cited in the article involves Masco Corporation; a company that built competence in metalworking and diversified into other closely related industries. Unfortunately, the returns from this strategy were lower than what the Masco had expected because the bargaining power of the buyers was high, buyer switching costs were low, entry barriers were low and the bargaining power of suppliers were high. No amount of metalworking expertise could have helped Masco improve profits in such an unattractive industry.

Company Insights on BP, Microsoft, and Western Digital

On August 30, we all chose 5 stocks to evaluate before purchasing. At this time I chose BP AMOCO, Microsoft, Western Digital, Toys-R-Us, and Fortune Financial Incorporated. After a few weeks of tracking these stocks, I chose to keep BP AMOCO, Microsoft, and Western Digital, because the stocks were relatively stable and most of them were on the rise at this time.

As you are aware, we were given $30,000. 00 to invest in our three chosen stocks, which breaks down to $10,000. 0 per stock. We also had to include a brokers fee of $500. 00 for every $10,000. 00 invested. My first stock was BP AMOCO. On September 8, I purchased 167 shares at $57. 06 per share, which totaled $9,523. 00 and incurred a $476. 15 brokers fee, making the grand total spent $9,999. 15. BP is one of Britains biggest companies and one of the worlds largest oil and petrochemical groups. Its origin dates back to May 1901.

BP owes its origin to one man, William Knox DArcy, a wealthy Englishman, who obtained concession from the Muz-affaru’d-Din, Shah of Persia (1896-1907) to explore and exploit the oil resources of the country, excluding the five northern providences that bordered Russia. He, shortly after the turn of the entury, invested time, money and labor in the belief that worthwhile deposits of oil could be found in Persia, which is now known as Iran. Having been granted the concession; DArcy employed an engineer, George Reynolds, to undertake the task of exploring for oil in Persia.

For seven years, Mr. D’Arcy battled with severe weather, the absence of a developed infrastructure, the shortage of skilled local labor, the problems of dealing with neighboring tribes in the absence of a strong central government, difficult terrain, and an uncertain political situation. These conditions made Reynolds pioneering task an exceptionally difficult venture. Meanwhile, the costs mounted stretching DArcys resources to the point where e sought outside financial assistance. This came in 1905 from the Burmah Oil Company, which provided new funds for his venture.

More exploration in Persia followed without success, until eventually, in May of 1908, Reynolds and his helpers struck oil in commercial quantities at Masjid-i-Suleiman in southwest Persia. It was the first commercial oil discovery in the Middle East, signaling the emergence of that region as an oil producing area. After the discovery had been made, the Anglo-Persian Oil Company was formed n 1909 to develop the oilfield and work the concessions. At the top of Anglo-Persians formation, Burmah Oil Company owned 97 percent of its ordinary shares.

Lord Strathcona, the companys first chairman, owned the rest. Although D’Arcy was appointed a director and remained on the board until his death in 1917, he was not to play a major part in the new company’s affairs. His role as the initial risk-taking investor was past and the daunting task of developing the oil discovery into a commercial enterprise shifted to others, amongst whom one stands out: Charles (later Sir Charles, then Lord) Greenway. Greenway was one of Anglo-Persian’s founder-directors, becoming managing director in 1910 and chairman, after Strathcona, in 1914.

Greenway, anxious to avoid falling under the domination of Royal Dutch-Shell, also turned to another potential source of revenue and capital: the British government. The basis of an agreement to mutual advantage lay in Greenway’s desire to find new capital and an outlet for Anglo-Persian’s fuel oil; and, on the government’s part, in the desire by the Admiralty (then headed by Winston Churchill as First Lord) to obtain secure supplies of fuel oil, which had dvantages over coal as a fuel, for the ships of the Royal Navy.

After lengthy negotiations, an agreement was reached in 1914 shortly before the outbreak of World War I. Anglo-Persian contracted to supply the Admiralty with fuel oil and the government injected $2 million of new capital into the company, receiving in return a majority shareholding and the right to appoint two directors to Anglo-Persian’s board. Although the government undertook not to interfere in Anglo-Persian’s normal commercial operations, its shareholding introduced an unusual political dimension to the company’s affairs.

In later years, the government shareholding was reduced and — apart from a tiny residual holding — ended in 1987. Further expansion followed in the decade after World War I. New marketing methods were introduced, with curbside pumps replacing two-gallon tins for the distribution of motor spirit (or, gasoline). Anglo-Persian also marketed its products in Iran and Iraq; it established an international chain of marine bunkering stations, and in 1926 began to market aviation spirit.

New refineries, much smaller than the plant at Abadan, also came on stream — at Llandarcy in South Wales in 1921 and at Grangemouth in Scotland in 1924. Moreover, the company’s majority-owned French associate had a refinery at Courchelettes, near Douai. On the other side of the world, in Australia, a new refinery at Laverton, near Melbourne, was commissioned in 1924. Exploration was carried out not only in the Middle East, but also in other areas, such as Canada, South America, Africa, Papua and Europe.

By the time Greenway retired as chairman in March 1927, he had realized his main strategic goal of establishing Anglo-Persian as one of the world’s largest oil companies, with a substantial presence in all phases of the industry. In 1935, the company was renamed the Anglo-Iranian Oil Company. During the post-war reconstruction of Europe, the high demand for oil enabled Anglo-Iranian to expand its business greatly. The company’s sales, profits, capital expenditure and employment all rose to record levels in the late 1940s.

The refinery at Abadan was by this time the largest in the world. Moreover, crude oil production from the company’s Iranian oilfields kept Iran at the top of the league of Middle East oil producing countries. Meanwhile, Anglo-Iranian entered the field of petrochemicals. An agreement ith the Distillers Company in 1947 resulted in the formation of a joint company, later to become known as British Hydrocarbon Chemicals, which produced basic materials from naphtha at Grangemouth. A second petrochemical complex was built at Baglan Bay in South Wales in 1961.

While the company was expanding its operations in the late 1940s, it was also engaged in talks with the Iranian government about the terms of its oil concession. Long and complex negotiations failed to produce an agreement, and in 1951 the Iranian government passed legislation nationalizing the company’s ssets in Iran, then Britain’s largest single overseas investment. The nationalization precipitated a major international crisis in which the British and US governments became deeply involved. The company’s operations in Iran were brought to a halt.

Only after three years of intensive negotiations was the crisis resolved by the formation of a consortium of oil companies, which, by agreement with the Iranian government, re-started the Iranian oil industry in 1954. Anglo-Iranian — which was renamed The British Petroleum Company in 1954 — held a 40 percent share in the consortium. One of the effects of the Iranian nationalization crisis was that the company was forced to broaden its operations to make good the loss of oil supplies from Iran, on which it had depended.

Crude oil production in other countries, notably Kuwait and Iraq, was greatly increased; and new refineries were built in Europe, Australia and Aden. In another development, in 1952, the company commissioned its first lubricating oils plant at Dunkirk. Two years later, it began marketing BP Visco-Static, Europe’s first multi-grade-oil. Although all of these events were important for the company, it was ydrocarbons under the North Sea and under the permafrost of Alaska that were to play the key role in transforming BP into the company it is today.

Earlier, in 1959, the Dutch had discovered a giant gas field on the edge of the North Sea at Groningen. This discovery encouraged others to begin searching for hydrocarbons offshore. BP scored the first success in British waters when, in 1965, it found the West Sole gas field, which it brought on stream two years later. The search for oil spread farther north, and in 1970 BP discovered the Forties field — the first major commercial find in the UK sector. Meanwhile, in Alaska, BP was rewarded for ten years’ exploration effort when, in 1969, it announced a major oil discovery at Prudhoe Bay on the North Slope.

When it became clear that, through its large share in Prudhoe Bay, BP owned part of the biggest oilfield in the USA, the company decided that its Alaskan oil could best be handled by a well-established US refining and marketing company. Accordingly, it signed an agreement with the Standard Oil Company of Ohio in August 1969. This company, the original John D. Rockefeller Standard Oil, was the market leader in Ohio and was strongly represented in neighboring states. Under the agreement, which became effective from 1st January 1970, Standard took over BP’s leases at Prudhoe Bay and some East Coast downstream assets that BP had acquired in 1968.

In return, BP acquired 25 percent of Standard’s equity, a stake that would rise to a majority holding in 1978 when Standard’s share of Alaskan production passed 600,000 barrels a day. The 1970s were the decade of the two great oil price shocks (1973 and 1979/80) that were to have serious effects on the world’s economies. It was also a decade when the major oil companies saw a decisive change in their old oncessionaire relationships. Like its major competitors, BP lost direct access to most of its supplies of OPEC oil as the OPEC countries took control of production and prices.

The 1973 price explosion had a dramatic effect on demand. BP’s oil sales started falling for the first time since 1952 (with the exception of 1957, the year of the Suez crisis). By 1978, sales had recovered somewhat; but then the Iranian revolution came and another major rise in the price of oil. In 1979, BP suffered further blows when its assets in Nigeria were nationalized and its supplies from Kuwait cut back. By 1980, its sales were down again. The entire oil industry was affected by the events of the 1970s.

But thanks to BP’s large investment program in areas outside the Middle East, the company showed as it had done in Iran in 1951, that it could survive. As noted, of key importance were the developments of its oilfield discoveries in the North Sea and Alaska. In the autumn of 1975, BP pumped ashore the first oil from the North Sea’s UK sector when it brought the Forties field on stream. This field development was financed by a bank loan of $370 million, then the largest wholly rivate bank advance ever arranged.

At its peak, Forties produced half a million barrels a day, equivalent to one-quarter of the UK’s daily oil requirement. Since the early 1980s, BP has developed many more oil and gas fields in the North Sea. Among these have been, in the UK sector, Magnus (commissioned in 1983), the Village gas fields (1988), Miller (1992) and Bruce (1993) and, in Norwegian waters, Ula (1986) and Gyda (1990). In Alaska, meanwhile, the construction of the 800-mile Trans-Alaska Pipeline System enabled the Prudhoe Bay field to come on stream in 1977.

In 1981, the Kuparuk field also started production, and towards the end of 1987 the world’s first continuous commercial production from an offshore area in the Arctic was achieved when the Endicott field was commissioned. Today, BP’s other oil- and gas-producing countries include Abu Dhabi, Australia, Colombia, Norway and Papua New Guinea. The upheavals of the 1970s led BP to conclude that it should broaden its activities so that it could operate in the future with more balanced sources of income. Accordingly, from the mid-1970s there was increased emphasis on diversification into new areas of activity.

Merger of Union Planters Corporation and Regions Financial Corporation

On Friday, January 23, 2004 Union Planters Corporation and Regions Financial Corporation announced they would merge. This will create the twelfth largest holding company in the United States. This merger was deemed the merger of equals (Hillard, 1/26/2004, para. 2). The stockholders of both companies overwhelming voted for the merger on June 8, 2004 (Morgan, 6/17/2004, para. 2). On June 17, 2004 the merger received approval from the Federal Reserve, the last of the governmental approvals needed (Morgan, 6/17/2004, para. 1).

The merger effective date was July 1, 2004, when the Union Planters stock symbol ceased to exist (Morgan, 6/17/2004, para. 5). Union Planters Corporation was a 31. 5 billion dollar holding company. They were the largest holding company headquartered in Tennessee and one of the largest thirty in the United States (Morgan, 6/17/2005, para. 10). Union Planters has 925 Automatic Teller Machines and 717 banking office. These banking offices are located in Alabama, Arkansas, Florida, Illinois, Indiana, Iowa, Kentucky, Louisiana, Missouri, Tennessee, and Texas (Morgan, 1/23/2004, para. ).

Before the merger, Union Planters revenues had decreased 11. 86% from 2002 to 2003. Their net income also decreased by 2. 3%. Union Planters’ compounded annual growth in the net income category was only . 04% for both three and five years respectively (Thompson, 12/2003-5/2004). Union Planters has struggled the last few years due to their mortgage operations. If the merger had not taken place it would have struggled to reach the EPS guidance they gave a week before the merger announcement (Goldberg, Jason, 1/26/2004, para. 19).

Union Planters does not have a good track record for integrating bank mergers, especially one of this size (Goldberg, Jason, 1/26/2004, para. 20). This might have been one reason why they fell into the arm of Regions. Union Planters has improved their balance sheet somewhat, but their non-performing assets to assets ratio is still high compared to their peers. Their net charge offs for the average loans in 2003 was . 89% (2004, para. 5). Regions Financial Corporation before the merger was a 48. 6 billion dollar holding company. Regions Financial operates 680 offices across the south.

They also own Morgan Keegan, a brokerage subsidiary, which has 140 offices. Morgan Keegan is headquartered in Memphis, Tennessee and will remain in Memphis. Regions’ is a member of Forbes and Fortune 500 (Morgan, 1/23/04, para. 17). Regions revenues also declined 8. 44% from 2002 to 2003. Their net income increase 5. 15% between 2003 and 2004. Regions three year compounded annual growth for net income was . 09% and . 04% for five years (Thompson, 12/2003-5/2004). Regions also does not have a good track record of integrating their mergers (Goldberg, Jason, 1/26/2004, para. 20).

Profit growth for Regions lagged behind the industry average in 2003 (1/24/2004, para. 1). Both banks are similar in size, corporate culture, and operations. There is very little overlap of their branches. Regions and Union Planters have a total of 1,383 branches in fourteen states. As you can see from the table below, Regions and Union Planters only have overlapping branches in six states. Tennessee creates the biggest challenge for consolidation with seventy-two branches in twelve cities. However, consolidation of branches in large cities such as Memphis, Tennessee may not be a problem.

Depending on where each branch is located, the closing of branches may be minimal. This is a very important factor when companies merge due to job loss and moral. Hopefully most of the jobs losses will be through attrition and if jobs must be eliminated then it should be minimal. The new Regional Financial Corporation has combined two very equal corporations. In the banking world, bigger is usually better and provides economy of scale. The integration of both companies into one is expected to take three years.

The savings obtained from the combined operations has been estimated as 15% in 2004, 60% in 2005, 85% in 2006, and 100% afterwards. (Hilliard, 1/26/2004, para. 3). However, a merger of two equals usually has disappointed their shareholders. Sometimes this is a lack of clear leadership. This is not the case in this merger because Union Planters CEO, Jack Moore will become the CEO of Regions after Regions’ CEO Carl Jones retires this year. Another reason for disappointing the shareholders is the corporate culture, but these banks are very similar in that respect also.

There were no premiums paid to Union Planters because the stockholders received one share of Regions’ stock for one share of Union Planters stock. However, Regions’ stockholders did receive about a 2. 6% premium for their shares (Goldberg, 1/26/2004, para. 10). From an outside view this looks like the perfect merger, but that may not be the case. In conclusion, this merger may not be a winner for the stockholders. Neither corporation has produced the growth seen by other banks. So the question still remains on how Regions will grow their corporation.

It appears that most of the growth will come from cost savings from the combined operations. This short lived growth does nothing to help long term growth that will be needed to keep pace with the other banks in the country. Even though there is very little over lapping of the bank branches, the merger still does not produce a viable footprint. Too much of their growth depends on their mortgage banking. Morgan Keegan’s helping hand has also declined (Horowitz, 1/25/2004, para. 10). The new Regions’ stock is below their 50 and 200 day moving average (Yahoo, 01/25/2005, chart).

Their fourth quarter EPS was $0. 56, which was below the consensus of $0. 59. Minimal fee income along with higher expenses and de-leveraging of the balance sheet helped to decrease the fourth quarter results. A good point to mention is that the non-performing assets have declined 2% and net charge-offs were just . 33% of the average loan. (Credit, 1/18/2005, para. 5). This past quarter Morgan Keegan did help offset the declining fee income and especially the lower performing mortgage operations.

The mortgage conforming business fell to $0. 85 million from $4. illion posted in the third quarter. This trend is expected to continue through 2005 (CitiGroup, 1/18/2005, para. 16). The fourth quarter also saw a marine manufacturing credit declare bankruptcy. This indebtedness for the marine company is sixty million.

However, Regions feels the debt is well secure and doesn’t expect a write off. (Credit, 1/18/2005, para. 11). This merger has kept other banks from buying them for the present time. Based on both companies flat performance for the past several years, it could be just a matter of time before Regions is taken over by a larger bank.

Sony By Honorary Chairman

Sony has four products categories as gateways to the networked world: digital TV’s and set-top boxes, VAIO home-use PCs, mobile devices and the best selling of them all is the Playstation 2 (PS2). With all of the new products like the PS2 and Sony. com, released their sale were still low.

Sony consolidated net sales decreased 1. 7% and operating income fell 30. 9%. However, on a local currency basic, it as a year in which Sony’s businesses performed well. The PS2 went on sale in 2000 and shipped over two million units in less than three months. The biggest reason for me choosing this company was because of the great products they produce.

From Vega’s TV’s to blockbuster motion pictures and all that fall in between, Sony has proven to be a well-rounded company. Sony’s Internet service provider So-Net, which has operated in Japan since 1996, offers some great features like: network-based content and service. In February 2000, Sony established SonyStyle. com in Japan to conduct marking and sales of Sony products.

As a hardware company and a provider of content and services they are number one in many of today’s homes. At the end of march 2000, the market capitalization of Sony Corporation was 13 trillion. This was a big increase form the previous year amount of 4. rillion. Income before taxes and net income figures for the year included gains of 58. 7 billion and 30. 7 billion.

Sony’s financial conditions are now strong and remain strong. Total assets increased by 508. 1 billion, or 81%, this year. It was estimated that the total assets would have increased by approximately 15% compared with the previous year. Sony’s stock was at 61 percent at the time of my paper. Investments and advanced by 94. 9 billion. Sony has taken one more even bigger step to make environmental actives a core element of its management system in order to reduce its impact.

Sony makes effort as much as possible to reduce the energy that products consume and the resources used to make them. They also try to avoid using materials with a high environmental impact. Presently, music distribution service and e-commerce are readily available on the Internet.

However, in the broadband network era, reams of data, including images and music, will be smoothly exchanged over high capacity, high-speed communications based on ADSL, cable, fiber optics, digital broadcasting, and many others. Sony has a lot in store for us, and I for one can’t wait to enjoy more of their products and service’s.

What direct marketing efforts would you recommend to Avon

When I think of Avon the first thought that comes into mind are the Avon ladies and those Avon catalogs. This is actually what most people think of I believe. Avon is a extremely well-known company but this does not mean it doesnt have its problems. During the 80s Avon has had its shares of negativity; debt reaching -$400 millions but since then has bought itself up again and now into the 21st century it is trying many different options to increase sales which have barely climbed in the last four years.

The direct marketing efforts that I recommend Avon make are to definitely focus on television advertisement commercials like they did in the early 90s. To be honest the only advertisement for Avon I know of or only recognize are the print ads in magazines. Having television ads would make people more aware of Avon than they already are. It definitely would linger in peoples minds more than just seeing magazine ads. Print advertisements should also increase in number and be published in different magazines ranging from teens to woman with products being advertised that are targeted to that specific group.

Telemarketing can be help but I do not think Avon needs to focus on this. Maybe having telemarketers calling during holiday seasons offering a free holiday catalog or even just calling year round asking if consumers have an Avon representative or if they wish to receive a free catalog and have a Avon representative in their area contact them. Avon has used this method in the past but this method might be expensive and not yield much profit since you are not actually taking orders during these phone calls.

Direct mailing could also be of help since Avon has tried this in the past and has a greater response then the norm (11% rather then the 1% or 2% norm). This could also erase telemarketing since it basically is the same concept but no Avon representative would be given the interested customers name and address. Adding bind-ins could be useful too since the average girl or woman do read a lot of magazines and this would work well with print media advertisements. Imagine having an ad for an Avon product and then right next to it you see a postage paid reply card for a free catalog.

Even though Avon has in the past sent out samples of products maybe adding samples of makeup or fragrances in magazine ads would attract people to buy them and other products. Avon has recently begun to talk about how they are going to sell a special product line at stores such as Sears. This is a great opportunity for Avon to put ads in local newspapers of the cities in which there are Searss stores and also to buy space in Searss weekly flyer in Sunday papers. This can be an enormous plus for sales and profits of Avon.

I know this will hurt Avon representative but what is being sold is not the same product line sold in the catalog. Loyal product users of the catalog makeup will always stick with their favorite from the catalog. Avons main target market has always been woman between 35 and 54. I feel that Avon should focus in the young woman/teen market. I feel that once young women become customers that they will be customer for a long time and maybe even life. It is best to expose and introduce someone to Avon when young because I know I am still wearing some of the same brands of makeup that I did when I was younger.

College students to me would be a great target market since most dont have enough money to buy department store makeup and even drugstores Avon is known for its affordability and this group would be perfect to target. Once one friend has the makeup a ripple effect usually occurs. Groups of friends usually have the same things; I know this is true of mine. In order to target this group I feel a whole new product line has to be introduced that specifically targets college age woman and young adults/teens. Shimmer makeup, funky colored eye shadows and nail polishes, body glitter and just colors that this age group is wearing.

Trendy, chic, fun and flirty is what these girls are looking for not the usual pinks and reds that moms and grandmas wear. Advertising in dorms for Avon workshops could be posted in various colleges and universities with a number to call if interested. Print advertisements in magazines such as Seventeen, Glamour, and Elle should take place as well as free samples given out in the freshman dorm packs at orientation. Avon products are affordable and I guarantee that focusing on this target group would bring Avon a younger trendier following and yet its normal product line will still have its normal customer following.

Avon needs not take away any makeup but add on which is just attracting more customers plus more sales which equals bigger profits. Avon is as I have said earlier known for its quality at a reasonable price. Well when introducing a new product line, products should be sold at a special preview price that will be lower than the price it will be after the preview sale. As far as the regular product lines I definitely think special offers like when you buy a product from the new line you will get a regular product for half off.

This will increase sales of the product line to regular customers outside the targeted group. Major promotion for Avon products should take place. Promotional offers such as getting a certain amount off on your first purchase, offering coupons for a free makeover when Avon products are sold in department stores. Promotional events I believe should be an ongoing priority. I feel in my opinion Avon knows who its customers are and hope they will always be Avon customers. This might be true for some but Avon has to remember the saying out of sight out of mind; therefore I feel promotion is much needed.

In terms of product mixing, Avons sales are mainly form its cosmetics and beauty line but they also sell different products such as childrens books and toys as well as jewelry and clothing. I feel that Avon should definitely emphasize its makeup line of course but I feel they should also emphasize and focus on childrens items. Since the majority of Avons consumers are from 25-55 I feel that a childrens line would be profitable since mothers will have the convenience of ordering products for their children as well as toys and books from a company whose name they have faith in and trust and have used themselves and have gotten positive results.

As far as distribution is concerned I feel like Avon does do a good thing by offering customers the choice of buying directly from the distribution centers. I feel that this is a positive thing since the centers have served as showcases for products. Having Avon products readily available for customers to purchase is a easier more convenient time saving method of selling. Most consumers like the idea of not having to call their Avon lady place an order and then wait for the products to be delivered. Distribution centers would make Avon products more accessible to the consumers in that area.

I feel like more centers should be built. I mean I know from personal opinion when I think about ordering Avon I find it a hassle to try and find a representative to get a catalog. Id rather run to the drugstore and buy cosmetics from there. Even the thought of having to wait for the products to arrive to me is a disappointment. I know that if there were a distribution center near and Avon products were accessible to me I would have a lot of Avon products. This is why having products sold in department stores would definitely increase sales since more people would be exposed to the Avon product line.

Intel Corporation Essay

“A corporation is a business that, although owned by one or more investors, legally has the rights and duties of an individual. Corporations have the right to buy, sell, and own property. Corporations may make legal contracts, hire and fire workers, set prices, and be sued, fined, and taxed. A business must obtain a charter of incorporation from a state legislature or Congress to be legally recognized as a corporation. “(Watson, p211) While corporations didn’t exist until the mid to late 1800s, the idea of the corporation had existed since the early 1600s.

It all started with English merchants who started trading companies o help fund the early colonies. If the colonies thrived, the stockholders reaped in the profit. (Watson, p211) A corporation is started when a sole proprietorship, a one-owner business, that is the most common form of business institution in the US, or a partnership, an association of two or more people in order to run a business, decides that they don’t want to be personally responsible for any loss the company might have. Watson, p211)

Or they might decide that they want the company to “live on” after they die, that is for the business to have “unlimited life”. Since neither of these oals can be reached with a sole proprietorship, or a partnership, the owner (or owners, as the case may be) decide that he (they) want to “convert” their business to a corporation. The owner(s) file a charter of incorporation from the government to be legally recognized as a corporation. (Boyd, March, 99) The owner(s) then sell shares of stock, documents representing ownership in the corporation, to investors.

These investors buy and sell the stock to small investors, or stockholders. Since there is no limit to the number of shareholders to a company, the investors vote (for every share you own you get ne vote) on a board of directors. The board of directors are in charge of hiring the people responsible for the every-day running of the corporation. These positions include, but are not limited to: the president, vice president, and other chief administrators. (Watson, p211-212) If a corporation reaps a profit, investors may receive a dividend, or a share of the monetary gain made by the company.

The elected board of directors choose whether the money will go towards profit, expansion of the company, modernization of the company, or research and development. (Watson, p212) “With about 85% of the icroprocessor market, Intel is definitely inside. Its microprocessors — including the Pentium — have been providing brains for IBM-compatible PCs 1981. “(http://thestandard. net. ) Intel started on July 16, 1968 when magnetic core memory was the leading technology at the time. They were trying to make semi-conductor memory practical with silicon memory.

Unfortunately for Intel semi-conductor memory cost 100 times more than magnetic core memory, but the silicon had many advantages – smaller size, greater performance, and reduced energy consumption. Then, in late 1968,the Japanese company Busicom asked Intel o produce a series of chips (twelve chips for every unit) for a group of programmable calculators that they were producing. Normally, chips were made specifically for each product. Well, the designers at Intel decided that they would make a general purpose logical chip to replace all of the many different varieties of chips that would go into the different electronics.

The logical chip was a major success; the only problem was that Busicom had the rights to the chip. Realizing that this chip could have a major impact on society, the founders Bob Noyce and Gordon Moore praised the new chip, while people in the orporation still wanted to stick with producing memory. Intel bought the rights to the chip from the struggling Japanese company for $60,000, and this “paved the way for Intel’s developing vision of ubiquitous (universal) microprocessor-based computing. “(/cn71898a. htm). The 4004 microprocessor set was introduced near the end of 1971.

Smaller than a thumbnail and packing 2300 transistors, the $200 chip delivered as much computing power as the first electronic computer, ENIAC. By comparison, ENIAC relied on 18,000 vacuum tubes packed into 3,000 cubic feet when it was built in 1946. The 4004 executed 60,000 operations in one second, primitive by today’s standards, but a major breakthrough at the time. “. “(/cn71898a. htm). Directly after the 4004, Intel introduced the 8008 microprocessor, which processed eight bits of information at a time, twice as much as the original chip.

This technological break-through put microprocessors everywhere, from fast food restaurants to airport control towers. Yet no one had thought of the personal computer, until; Intel Chairman Emeritus Moore remembers, “In the mid-1970s, someone came to me with an idea for what was basically the PC. The idea was that we could outfit an 8080 processor with a keyboard and a monitor and sell it in the home market. I asked, ‘What’s it good for? ‘ And the only answer was that a housewife could keep her recipes on it. I personally didn’t see anything useful in it, so we never gave it another thought.

Intel decided that they would try to become the processor-manufacture for IBM. They received some static at first, but eventually; Intel’s long-term commitment to the microprocessor product line and ability to produce in large masses convinced IBM to choose the 8088 chip processor for the first personal computer. Intel was thrilled at the thought, but had no idea the PC would become so popular.

The Intel sales engineer who worked with IBM on the project recalled, “At the time, a great account was one that generated 10,000 units a year. Nobody comprehended the scale of the PC business would grow to tens of millions of units every year. . “(/cn71898a. htm) In 1982, Intel introduced the 286 chip. With 134,000 transistors, it was three times as powerful as the current chips.

This 286 chip was first used in IBM’s very memorable machine, the PC-AT. In 1985, the Intel386 processor came off the showroom floor. With 275,000 ransistors, the chip was a huge jump from the competition. The Deskpro by Compaq was the first PC that used the 386 chip. The Intel 486 processor was released in 1989. This new chip had all the fixins’: 1. 2 million transistors and was the record-breaking first chip to have the first built-in math coprocessor.

In 1993, Intel introduced a processor with five times the speed of the 486, the Pentium processor. The Pentium chip uses 3. 1 million transistors. In 1997 Intel started introduced its MMX technology, a breed of chip build for high multimedia performance. After MMX took hold, it is now standard on all Pentium processors. In 1998 the Pentium II chip was released with incredible speed and mind-blowing processing power. .”(/cn71898a. htm) The Intel Corporation is an amazing company that will be around for a very long time. As of 1997 the company was worth $26,273,000,000.

The CEO of Intel is Craig R. Barrett. Intel, as of 1997, had 63,700 employees on its roster. In my personal opinion, I feel that Intel is a very reliable chip manufacturer, I buy only Intel brand processors because of their reliability, and I would proudly join their workforce if at all possible. Stock Exchange: “market for the sale and purchase of securities of orporations and municipalities, and, in some cases, of certificates representing commodities of trade. “(Funk and Wagnalls p359) The first stock exchange to be built was in Antwerp, Belgium in 1531.

In 1773 the brokers of London formed an exchange in England. In New York City, brokers met to exchange stocks under a button tree until they organized the New York Stock Exchange. (Sobel, p904) The NYSE only let in stocks that it deemed “good enough”. Those that didn’t pass the test where traded outside on the curb of the NYSE building. This “curb exchange” later formed the American Stock Exchange, or the ASEX. Edustock /3088/) In the 1920’s the American economy was booming, due in an increase in industrialization, and an increase in technology.

There was an increase in wages, an increase in spending, and an increase in stock prices. People bought billions of dollars worth of stock -on margin, mind you- and economists said that the uprise would continue. Because of the large number of people buying in margin, left the stock market in a vulnerable position. Many stockholders, ready to reap a fortune, invested all they had, even mortgaged their homes and emptied their bank accounts. As the prices spiraled higher and igher, economists began warring people of the turmoil that could lie ahead, but everyone was interested in making money and paid no heed.

Finally, in October of 1929, the purchasing frenzy calmed, but then burst into a selling bonanza. On Thursday, October 24th, 1929 the strong iron bars of the U. S. economy began to give way. Stock prices fell to the floor as investors struggled desperately to sell. When the New York Stock Exchange closed that day, it had lost over four billion dollars. By the next Monday, the 28th, a widespread panic took form. Thousands of investors, some “normal”, working citizens, were ruined inancially. By the end of 1929, stock values had dropped by fifteen billion dollars. www. thehistorychannel. co. uk)

“There have been many market crashes since 1929 however this is the one that had the greatest impact. It is still to early to say for sure whether the economic situation that is effecting global stock markets will result in such a scenario. The only fact that is certain is that we are in the middle of a large correction in the value of global stock prices. With crises in Asia, Latin America and now Russia rolling from one to another, the fear of a 1929 style crash is once again with us. “

Marketing Plan for the introduction of Wide-bottom jeans

In order to understand why the Wide-bottom Jeans Group exists, it is inalienable to especially focus on one person, the founder and the core of the company Christie Clark. Her personality alone already legitimates the purpose of the company, playing the role of the every positive thinking entrepreneur, that is strongly drawing together stakeholders and employees by showing them that they can commit themselves to the business not only because of financial benefits. Clark`s and therefore Wide-bottoms higher ideal just simply seems to be to have fun and find new challenges while doing business.

Strategy Wide-bottoms core strategy seems to be to go into those markets were complacent industries have held high prices for years because of their monopolistic size. And they try to take an advantage of that complacentness. The markets itself can not be defined exactly as the Wide-bottom Group never had a core business thing. Thus the business where Wide-bottom wants to be in is also hard to define, but there is an opportunity for Wide-bottom wherever the monopolistic position of a competitor can be beaten.

Another basic strategy of the Wide-bottom group is always to use its undoubtedly strong brand name which is one of the view that is elastic enough to bind together a clutch of diverse products without snapping. It is part of Clarks strategy that the Brand name is not so much a product that it stands for, rather it stands for values: youth, iconoclasm, cheeky and perky informality. This provides the Wide-bottom Group with a flexibility that is almost unbeatable in terms of brand name.

The key is to make sure that the Wide-bottom name stays fresh and not to overuse it, and certainly the product has to have a certain quality. The third part of any Wide-bottom strategy that has to be emphasized, is the strategy of public figure marketing. Like no other entrepreneur in Longview, Texas, Christie Clark has the talent to market her products by going into the media with extraordinary actions that get her into the front-pages of the newspapers without paying any money for this advertisement. Company Values The values seems to be having fun in the business and to do things differently.

The goal of the Wide-bottom Group is to be the ultimate outlet and to provide the best value for money to customers. They believe that there should be some kind of fun to go into the big monopolistic businesses and then shake them up by offering good value quality based products, and a better service and people care to the customers and last but not least to make a profit at the end of the day. Overall the mission statement has clearly been defined by Christie Clark over the last 5 years. She has the Vision, the strategic intent, and she is the motivator for any person who is part of the company.

Strengths The Wide-bottom group has the advantage that they are experienced in two different kinds of distribution. Firstly in stationary trade and secondly in mail ordering. The group is far less integrated than other big groups like Daimler or Smiths Industries. This gives Wide-bottom the advantage of higher flexibility. This effect is even more extreme since Wide-bottom has very small Strategic Business Units. The Wide-bottom Group has a strong brand name incorporated by Christie Clark and is experienced in introducing new products in an competitive marketing environment.

Weaknesses The strength of being not too integrated into the concern can also be a weakness, when errors are discovered too late because of a too loose supervision or when the support of the mother company becomes insufficient or because of sluggish communication. Christie Clarks chaos approach is therefore less efficient. Opportunities The jeans market is an old and established market. The leading companies – being in the market for a century or more – have established themselves in a monopolistic situation with the help of huge advertising budgets.

The magic concept of Christie Clark in the past was to exploit the inefficiency of these kinds of markets normally protected with high barriers of entry. Threats The jeans venture is only one of the many in the big group and could easily be abandoned if it seems not to be feasible after a while. The jeans market has a very unsteady component which are the designer jeans. With the customers change in taste new competitors enter and leave the market. At the moment all the important designers are coming back into the market. The situation is very much alike the one in the late 70s and early 80s.

In the mid 80s the market for designer jeans collapsed and many players had to leave the market. Generation and Evaluation of Strategic Options There are a number of different options for a possible entry into the highly competitive jeans market , firstly Wide-bottom could use its promotion experience to take over some claims of the existing competitors. Wide-bottoms second penetration possibility could be to use distribution channels more efficiently than its competitors therefore being able to get an advantage in terms of costs and service. Thirdly, Wide-bottom has the possibility to sell the new product at a very competitive price.

Wide-bottom could also acquire an already established company in the jeans market to be able to gain access. Even though the product and the market is new, the entry strategy is based upon the core competence of the Wide-bottom Group. Marketing Objectives The results of the generation and evaluation of strategic options lead to the definition of market objectives. Two types of objectives have to be considered which help defining the core strategy. These objectives are strategic thrust (future direction of the business) and strategic objectives.

Together they define where the business and its products intend to go in future Considering the facts Wide-bottoms future direction of its business is to enter into the existing jeans market by market penetration. Alongside objectives for product and market direction, strategic objectives need to be agreed This involves the process of planing at the product level. As it is intended to enter an existing market with existing products the determination would have to be the task of being better than the competitors in terms of price, service and supply.

This goal could be reached not only by being cheaper than competitors but also much more flexible, to put it in a nutshell, firstly offering the same product for a better price than competitors and secondly offering a closer and better customer service. The Target Market Generally speaking Wide-bottom should attack the recession proof 5 pocket style straight leg blue jeans market, thus competing against brands such as Levis, Mustang, Pepe Jeans, Lee, Wrangler etc. therefore targeting the average consumer. The core target market will be those jeans that are mainly sold in the department stores and the discount chains.

The target is the average customer whereas the most important component is the 5 to 24 year old customers which account for 60% of the total jeans market, especially for Wide-bottom this is an interesting option as this is a similar target group as the customers of the Wide-bottom Megastores this will be dealt with in more depth later on in this assignment. Expressed more precise referring to a lifestyle analysis the target segments are ranging from modern mainstream, traditional working class, traditional mainstream to upper conservative.

It has always been the core of the Wide-bottom philosophy to target an entire already established and rather mature market, in which it is possible to gain a small market share with the high profile of the Wide-bottom brand name. Competitor targets Alongside decisions regarding target markets lie judgements about competitor targets. The analysis of how industry structure affects long-run profitability has shown the need to understand and monitor competitors. The key to superior performance is to gain and hold a competitive advantage.

Firms can gain a competitive advantage through differentiation of their product offering which provides superior customer value or by managing for the lowest delivery cost. The right strategic focus for the Wide-bottom Group concerning competitor target would be to try to win market share as the jeans market is in its mature state and cannot be expanded. This strategy implies gaining marketing success at the expense of the competition. Wide-bottom should seek to win market share through promotional innovation and penetration pricing.

If Wide-bottom carries out a frontal attack towards the market leaders its advantage will be based on cost leadership which will support a low price strategy to fight the market leader. Furthermore success is more likely if there is some restriction on the leaders ability to retaliate. Restrictions include pride, inflexibility and high advertising costs and technologic advantage. All market leaders in the jeans market have high expenditure on advertising and promotion which they off load on the customer.

As Wide-bottom generally does not run highly expensive advertising campaigns it would not have this disadvantage, it could offer jeans to a far better price than competition. Concerning promotional innovation, Wide-bottom would not need to open new shops, as it could sell and promote the jeans in its existing record shops. Finally, the challenger, in this case the Wide-bottom group, needs adequate resources to withstand the battle that will take place should the leader retaliate.

Wide-bottoms cash cow which has to provide the money for all new investments is its airline, Wide-bottom Atlantic. This will enable the group to withstand major competitor attacks. Competitive Advantage Competitive advantage will be obtained through lower prices for a good quality product. This can be achieved by the Wide-bottom Group through a cost advantage in terms of already established brand name partly established distribution channels and a high bargaining power. Competitive advantage will also be achieved through being able to respond quicker to customer needs.

Through building small business, units a closer relationship with the customer can be established, thus representing a serious weapon against the economies of scale and scope of the major competitors in the market. A very advanced IT system will improve the flow of communication between distributors, manufacturer, head office and customer. Marketing Mix Decision The sales will take place in the Mega stores owned by Wide-bottom and in retail stores with a good reputation like Foleys and Dillards.

The fight for shelf space will clearly be won by Wide-bottom because of its established reputation and brand name. When these principles can be realized a solid average jeans at a very attractive price will be the result. The jeans will be available in two main lines: for men and for women. These will have slightly different cuts but still correspond to the classic five pocket style. The material in use will be denim and for the beginning there will only be two basic colours which will be different kinds of blue and black.

Implementation The near future does not seem to have major external positive or negative surprises. It is therefore unlikely that strategies and objectives have to be redefined. On an internal basis Wide-bottom is unlikely as well to be restructured or to be bought up and the marketing plan can then be implemented smoothly and without any problems. A rise of a new company of that size requires a fair amount of capital, which can be provided by the big Wide-bottom group. Control

Because of the rapid development of information technology, Wide-bottom has the possibility to gain a true competitive advantage towards its competitors. As Wide-bottom will have build up an IT-system for its new company anyway, it can buy the very latest standard, giving Wide-bottom a considerable advantage. Wide-bottom has the unique chance to be the first competitor with an interactive consumer service system. Wide-bottom has therefore to install an Intranet/Internet application that will enable outlets, distributors, manufacturers and consumers to communicate and order on a real time basis.

Such facilities are internationally available (although they are not fully exploited yet) and can meet the companys needs at lower cost then traditional computer systems and networks. An practical example would look like this: a consumer browses through the Wide-bottom Jeans Web site, then places a direct order, pays with his credit card and can then choose between a delivery per mail for an extra fee or collect her jeans at the nearest outlet. This avoids the very annoying situation to make ones way to an outlet just to find the required jeans sold out.

Furthermore would this action automatically update the stock list at all levels of the product chain (requirement: being on-line), change the accounts in the head office and give the marketing people a highly efficient tool to analyze consumers, their tastes and behavior (e. g. a questionnaire). A more detailed analysis of the future system would not be desirable as it would go far beyond the scope of this marketing plan. This IT system will incorporate the framework around which the marketing mix decision will be wrapped.

With the help of a highly advanced IT system it will be possible to realize the just in time approach. The IT system must not only be used to undertake day to day business but also to be aware of the market and its behavior. Audit In order to be able to launch a new product, the marketing environment has to be scrutinised, which consists of external and internal environment. Marketing audit is a basis upon which a plan of action to improve marketing performance can be build. The marketing audit provides answers to the following questions: Where are we now?

Assumptions should be made as an ongoing part of the marketing audit: Inflation will remain at around 2. 5% per annum. Unemployment will be about 8 %. Social and cultural casualisation have made jeans the most popular article of clothing. Although the younger part of the population tends to represent a bigger part of the jeans market, older people are becoming increasingly important. Jeans have made their way from working clothes to an every day dress. Little has been changed since the first modern jeans was manufactured by Levi Strauss. An important invention was the zipper introduced by Lee in 1926.

Tweed (the untreated cotton fabric) is still the material jeans are mostly made off. New materials include rubberized cotton, nylon, leather, velvet, corduroy, snake printed or sequined. The finishing wash every jeans goes through before it is ready for sale has recently seen some changes. Stone wash is an example for a washing trend in the late 80s and early 90s. Market and Competition According to Prudential Securities sixty per cent of the jeans market is five-to 24-years-olds. But this market segment will grow by only 0. 6 % each year for the rest of the decade.

The world market for Jeans is between 6. 6 and 8 billion Dollar worth and (4 to 5 hundred million pairs sold annually). The growth rate over the last few years was: 1996 – 2. 6%, 1997 – 2. 6%, 1998 – 2. 4%. The main competitors in the market are Levis, Wrangler, Mossimo, Girbaus, Diesel, Bugle Boy and Jordache. However, in dollar sales, Levi remains No. 1. Recent competition has come up by designers such as Versace, Armani, Moschino, Joop, DKNY, Lacrois, Dolce & Gabbana, Anna Sui and Todd Oldhamm. This development shows the new consumer trend to spend more on jeans if they are well branded.

Levis just introduced the baggy style in an attempt to regain market share in the urban youth customer segment, demonstrating the importance of the urban youth market. The majority of sales takes place in retail chains and not in jeans outlets. Mail order has a surprisingly small market importance. Internal Marketing Audit The internal analysis of the Wide-bottom Group is difficult because it is far less integrated than many other concerns like Daimler or Smiths Industries. Christie Clarks SBUs are unusually small and the business culture of them is quite different.

But still, certain patterns can be found through the group. The groups image is unusually young. The concept of success is always similar: value for money. Since Wide-bottom penetrates most of the markets it is understandable that the company has a competitive advantage over its rivals in terms of price. Furthermore Christie Clark incorporates a very valuable branding tool. She incorporates youth, dynamic, entrepreneurial skills, sympathy, continuity and non-scandalous behavior. This means that less money has to be spend on advertising and branding. This indicates that the jeans could be sold either way.

Wal-Mart Discount City in Rogers

In 1945, Sam Walton opened his first variety store and in 1962, he opened his first Wal-Mart Discount City in Rogers, Arkansas. Now, Wal-Mart is expected to exceed “$200 billion a year in sales by 2002 (with current figures of) more than 100 million shoppers a week(and as of 1999) it became the first (private-sector) company in the world to have more than one million employees. ” Why? One reason is that Wal-Mart has continued “to lead the way in adopting cutting-edge technology to track how people shop, and to buy and deliver goods more efficiently and cheaply than any other rival.

Many examples exist throughout Wal-Mart’s history including its use of networks, satellite communication, UPC/barcode adoption and more. Much of the technology that was utilized helped Sam Walton more efficiently track what he originally noted on yellow legal pads. From the very beginning, he wanted to know what the customers purchased, what inventory was selling and what stock was not selling.

Wal-Mart now “tracks on an almost instantaneous basis the ordering, shipment, and delivery of literally every item it sells, and that it requires its suppliers to hook into the system, enabling it to track most goods every step of the way from the time they’re made and packaged in the factories to when they’re carried out store doors by shoppers. ” “Wal-Mart operates the world’s most powerful corporate computing system, with a capacity (as of late 1999) of more than 100 terabytes of data (A terabyte is 1,000 gigabytes, or roughly the equivalent of 250 million pages of text. Only the U. S. government maintains a bigger database. ”

Sam Walton was eventually considered “the most influential retailer of the century, and with good reason, for nearly every great retailer of the coming years would follow his business examples. ” Industrial Revolution: When the Industrial Revolution took place in the United States, factories were now able to out produce consumer demand. For the first time, these new goods needed new ways to be sold, new ways to get to the public. “In New York, Philadelphia, and Chicago, the first department stores opened their doors.

Railroads and telegraph wires snaked across the country, giving storekeepers a new way to order goods and get them on the shelves faster than ever before. A whole new industry sprang up to persuade people through advertisements with enticing pictures and clever slogans, to buy things they’d never known they needed, to turn America, in the phrase department store pioneer John Wanamaker, into the Land of Desire. ”

At the same time, large corporations became another “dominant form of business”, such as with U. S. Steel, Swift, R. J. Reynolds, and Procter & Gamble. Department stores such as Woolworth, Penney, Sears, A&P, and Kroger became known in the retail environment. Early Discount Approach: “The first small discount stores” started in the 1930s, developed in the years after WWII and really began to take off in the 1960s as “giant discount chains”. A Brief history of Sam Walton the founder of Wal-Mart Sam Walton wanted to build a company that both cared for people and would make some money. With his timely thinking he and his partners built a company that has not slowed down.

While staying one step ahead of the ever-changing technology and methods of today’s fast paced business environment, Wal-Mart executives still rely on many of the traditional goals and philosophies that Sam embroiled on his company. The company has faced and is still facing a significant amount of controversy; however these have not contributed to any kind of downfall within the company. The future of Wal-Mart looks extremely profitable especially if they continue to increase its profits and rely on the beliefs that got them to the point they are at. In 1962, Sam Walton opened the first Wal-Mart store in Rogers, Arkansas.

Wal-Mart was at one time included in Fortune’s list of the “10 most admired corporations. ” The Wal-Mart Philosophy-Wal-Mart is successful not only because it makes sound strategic management decisions, but also for its innovative implementation of those strategic decisions. Many trace discount entrepreneur birth to1962, the first year of operation for Kmart, Target and Wal-Mart. But by that time, Sam Walton’s tiny chain of variety stores in Arkansas and Kansas was already facing competition from regional discount chains. Sam traveled the country to study this radical, new retailing concept and was convinced it was the wave of the future.

He and his wife, Helen, put up 95 percent of the money for the first Wal-Mart store in Rogers, Arkansas, borrowing heavily on Sam’s vision that the American consumer was shifting to a different type of general store. Wal-Mart is a national discount retailer offering a wide variety of general merchandise to customers. Wal-Mart stores offer pleasant and convenient shopping in 36 departments including family apparel, health and beauty aids, household needs, electronics, toys, fabrics and crafts, lawn and garden, jewelry and shoes.

In addition, some Wal-Mart stores offer a Pharmacy Department, Tire & Lube Express, garden center, snack bar or restaurant, Vision Center, and One-Hour Photo Processing for convenience (http://www. walmart. com). Wal-Mart stores operate on an “Every Day Low Price” philosophy and are able to maintain their low price structure through conscientious expense control. While other major competitors typically run 50 to 100 advertised circulars per year, Wal-Mart produces only 12-13 major circulars per year (http://www. walmart. com). The cost savings associated with fewer circulars are passed on to the customer through lower shelf prices every day.

Wal-Mart associates strive to provide exceptional customer service, a characteristic that is unique to the chain. Everything possible is done to make shopping at Wal-Mart a friendly experience (2000 Annual Report). Today, Sam’s gamble is a global company with more than 1. 3 million associates worldwide and nearly 5,000 stores and wholesale clubs across 10 countries. The “most admired retailer” according to FORTUNE magazine has just completed one of the best years in its history: Wal- Mart generated more than $256 billion in global revenue, establishing a new record and adding more than $26 billion in sales.

The company earned almost $9. 1 billion in net income and grew earnings per share by more than 15 percent. But it all started with an understanding of what consumers want from a retailer. “The secret of successful retailing is to give your customers what they want,” Sam wrote in his autobiography. “And really, if you think about it from the point of view of the customer, you want everything: a wide assortment of good quality merchandise; the lowest possible prices; guaranteed satisfaction with what you buy; friendly, knowledgeable service; convenient hours; free parking; a pleasant shopping experience.

You love it when you visit a store that somehow exceeds your expectations, and you hate it when a store inconveniences you, or gives you a hard time, or pretends you’re invisible. ” While other discounters such as Kmart quickly expanded across the country in the 1960s, Sam was able to raise the funds to build only 15 Wal-Mart stores. Wal-Mart got the boost it needed in 1970 when its stock was offered for the first time on the New York Stock Exchange. The public offering created the capital infusion that grew the company to 276 stores by the end of the decade. By focusing on customer expectations, Wal-Mart was growing rapidly in 11 states.

In the 1980s, Wal-Mart became one of the most successful retailers in America. Sales grew to $26 billion by 1989, compared to $1 billion in 1980. Employment increased tenfold. At the end of the decade there were nearly 1,400 stores. Wal-Mart Stores, Inc. branched out into warehouse clubs with the first SAM’S Club in 1983. The first Supercenter, featuring a complete grocery department along with the 36 departments of general merchandise, opened in 1988. Wal-Mart had become a textbook example of managing rapid growth without losing sight of a company’s basic values.

In Wal-Mart’s case, the basic value was, and is, customer service. Ironically, technology plays an important role in helping Wal-Mart stay customer focused. Wal- Mart invented the practice of sharing sales data via computer with major suppliers, such as Proctor & Gamble. Every time a box of Tide is rung up at the cash register, Wal-Mart’s data warehouse takes note and knows when it is time to alert P&G to replenish a particular store. As a result, Wal-Mart stores rarely run out of stock of popular items. Wal-Mart Stores, Inc. is principally engaged in the operation of mass merchandising stores.

At January 31, 2002, the Company operated 1,647 discount stores, 1,066 supercenters, 500 SAM’S clubs and 31 neighborhood markets in the United States. Internationally, at January 31, 2002, the Company operated units in Argentina (11), Brazil (22), Canada (196), Germany (95), South Korea (nine) Mexico (551), Puerto Rico (17) and the United Kingdom (250), and, under joint venture agreements, in China (19). The Company operates through three segments, the Wal-Mart Stores segment, the SAM’S Club segment and the International segment.

Source: MarketGuide Wal-Mart’s influence on the U. S. economy has reached levels not seen by a single company since the 19th-century rise of Standard Oil, economists and historians say. Even if you don’t shop at Wal-Mart, the retail powerhouse increasingly is dictating your product choices – and what you pay – as its relentless price-cutting helps keep inflation low. Wal-Mart is the top seller of groceries, jewelry and photo processing. It is moving into banking, used-car sales, travel and Internet access. It averages 100 million customers a week. Anyone whose stocks rose in the late 1990s owes Wal-Mart, the world’s biggest company.

It alone accounted for as much as 25 percent of the U. S. productivity gains from 1995-99, says consultant McKinsey & Co. Such gains drove corporate profits, thus stock prices. Wages in retailing, one of the biggest sources of new jobs in the ’90s and current decade, are also affected by Wal-Mart. “I joke we’re all going to be working for Wal-Mart someday,” says economist Mark Zandi of consultant Economy. com. Although Wal-Mart is hitting speed bumps because of growing labor challenges, employment lawsuits and higher costs, few doubt it will stop besting competitors as it expands.

While other retailers such as Home Depot, tech giants such as Microsoft and manufacturers such as General Electric played big parts in the 1990s productivity gains, Wal-Mart, with its massive buying power and technology advantage, played the biggest role, economists say. As it grows, its influence, largely unknown to consumers, will continue to seep into more parts of the United States and the global economies. “Everyone knows Wal-Mart,” says Jim Hoopes, a business history professor at Babson College, “but nobody has a real sense of how big and how powerful it is. ” Few companies have moved so far so fast.

Founded 40 years ago in rural Arkansas by Sam Walton, Wal-Mart has swelled to 4,300 stores in nine countries and annual revenue near $250 billion. Its computer network, a critical part of its success, rivals the Pentagon’s. It is now the biggest customer for many of the world’s leading consumer-products companies, including Kraft, Gillette and Procter & Gamble. At P&G, Wal-Mart accounts for 17 percent of annual revenue, up from 10 percent just five years ago. That makes those companies more dependent on Wal-Mart’s success, more vulnerable should it stumble and more likely to respond to Wal-Mart’s requests for lower prices and product changes.

The chain’s buying power is so immense that 450 suppliers have opened offices – many in the 1990s – near Wal-Mart headquarters in tiny Bentonville, Ark. As many as 800 more such offices are expected in the next five years. Sales representatives want to be near Wal-Mart buyers to beat the competition, says Rich Davis, a local economic development official. Wal-Mart is increasingly affecting: Product choices. P&G is dumping weak brands, such as Crisco and Jif peanut butter, sold to J. M. Smucker last year. It wants to focus on heavy hitters, such as Tide detergent, most desired by Wal-Mart and other big retailers, P&G says.

That strategy helped P&G boost fiscal second-quarter net income 14 percent year-over-year to $1. 5 billion, it said. Other companies have tweaked products so that they pass muster with Wal-Mart. Video-game maker Planet Moon Studios two years ago wanted an industry group to give its “Giants” game a teen rating. Why? So it would be carried by Wal-Mart and others. Planet Moon changed the color of blood in the video to green from red, toned down the language and put a bikini on a topless character, says CEO Bob Stevenson. Without those changes, he says, “The risk to sales was too high.

Wal-Mart is also challenging its suppliers by developing more of its own products, called “private labels. ” It stepped up that effort in the mid-1990s as it expanded into vitamins, batteries and bathroom tissue. Its Great Value grocery line has 1,475 items, up from 194 two years ago. Wal-Mart says it is committed to keeping shelves full of well-known brands such as Kellogg’s cereal and Tide. But, in general, private-label profits run as high as 30 percent, vs. 15 percent on brand-name items, says Burt Flickinger, managing director of consultant Reach Marketing.

Private-label products also promise Wal-Mart more profit as the chain expands abroad, because U. S. brands don’t have the same clout there. In Europe and the United Kingdom, where Wal-Mart is battling for Britain’s Safeway grocery chain, private-label goods are 50 percent of its sales vs. 25 percent in the United States. Product prices. Big food companies including Kraft, which gets 10 percent of its revenue from Wal-Mart, have not been able to raise prices as quickly as they once did because of Wal-Mart’s demands, says Jonathan Feeney, a consumer products analyst at investment firm SunTrust Robinson Humphrey.

Kraft declined to comment. History has shown that suppliers suffer if they run afoul of Wal-Mart. Rubbermaid raised the prices it charged Wal-Mart in the mid-1990s because of an 80 percent jump in the cost of a key ingredient in its plastic containers. The retailer responded by giving more shelf space to lower-priced competitors, helping drive Rubbermaid into a 1999 merger with rival Newell, says John Mariotti, a former Rubbermaid executive. “Rubbermaid earned Wal-Mart’s wrath by not giving it the best deal,” he says. Employment.

Wal-Mart’s impact on wages was first felt in rural towns in the South and Midwest where Wal-Mart got its start. Often, it became the biggest employer overnight, setting wage rates for all retailers, experts say. Now, its impact on retail employment has spread nationwide, contributing to slower wage growth throughout the sector, economist Zandi says. Pay for retail workers rose 43 percent from 1990 to 2001, vs. 50 percent for non-retail workers, according to Bureau of Economic Analysis data. No one knows exactly how big a part Wal-Mart played, Zandi says.

But its influence is “undeniable” because it created more jobs in the 1990s than any other company, he says. More retail jobs are on the way. Wal-Mart plans to add 800,000 workers in the next five years. U. S. retailers are expected to add 3. 1 million jobs by 2010, the government says. Manufacturers, which pay more, will add fewer than 600,000 jobs in the same period. Labor unions that represent factory workers are alarmed. They say Wal-Mart, in demanding ever-lower prices from suppliers, has helped drive thousands of U. S. nufacturing jobs abroad, where labor costs are lower.

Now they worry about Wal-Mart’s push into the unionized supermarket industry. Wal-Mart has no unions. That means its employees earn less than those at competing supermarkets, says the United Food and Commercial Workers. Wal-Mart’s hourly pay averages $7 to $8 an hour, vs. $11 at Kroger, Safeway and other competitors with unions, says UFCW spokesman Greg Denier. Not true, says Wal-Mart spokesman Tom Williams. While he would not disclose wages, which vary by market, he says Wal-Mart pay is close to or equal to union wages.

Productivity. Wal-Mart’s key role in the 1995-99 economic boom came partly because of its legendary use of technology to analyze costs and speed delivery of goods from its 30,000 suppliers to dozens of sprawling warehouses, say retail and financial analysts. Wal-Mart says it has the nation’s biggest private satellite communications network, one that links stores to Bentonville by voice, data and video. Suppliers tap directly into Wal-Mart’s computers to track sales of everything from soup to nuts, which improves inventory controls and cuts costs.

Other retailers, including Kmart, tried matching Wal-Mart’s tech prowess but failed. Kmart filed for bankruptcy-court protection last year and is cutting 67,000 jobs and closing nearly 30 percent of its stores. Wal-Mart also teaches manufacturers to be more cost-effective so product prices can stay down. For example, Wal-Mart might suggest that a supplier cut its labor costs by shipping toasters in their cartons, rather than packing them in bigger boxes and shrink-wrapping them onto shipping pallets, says James Champy, chairman of Perot Systems’ consulting unit, which advises Wal-Mart suppliers.

Such close communication between a retailer and supplier is unusual. But it’s being adopted by more companies, including Dell Computer, as U. S. businesses seek more productivity to better compete globally. “It’s where the future of business has to be,” Champy says. That future may also include fewer companies. To achieve economies of scale, more consumer products companies are merging. Wal-Mart’s demand for low-cost products partly influenced Kellogg’s purchase of Keebler in 2001, and the merger of Kraft and Nabisco in 2000, analyst Feeney says.

My Job at E-Dak

Coming to E-Dak, for me, meant leaving a comfortable “big-six” accounting position to work for a 30-person start-up. It was a tremendous gamble, but my choice came down to whether I wanted to continue performing repetitive audits or face new challenges at E-Dak Dynamics, and in the process help to change the world. Working for E-Dak places me at the epicenter of one of the world’s most dynamic industries: telecommunications/ networking.

Although I knew little about E- Dak’s domain of fiber-optics, I felt strongly that my fate rested in the renches of Silicon Valley, in an industry where only the paranoid survive, at a company with a business model in defiance of Moore’s Law. At the time the term ‘information superhighway’ hadn’t been coined yet, but it would soon become our driving focus, as data traffic over long-haul networks skyrocketed and the world’s telecommunications providers increased their investment in high-capacity fiber-optics.

With an innovative product line that provides pavement for the information highway, E-Dak quenches an unending and growing thirst for bandwidth. For me E-Dak has meant working at the fourth fastest growing company in Silicon Valley, with $500 thousand of revenue exploding to over $60 million in four short years. It has also meant playing a role in the information revolution. E-Dak gives me a broad business perspective. It’s relatively small size facilitates a close interaction with department heads.

If had I stayed in public accounting or gone to a larger corporation, I would not have earned the same breadth of experience, most likely being limited to working within a single division or with a handful of accounts. At E-Dak my scope encompasses all aspects of accounting and finance across the entire enterprise. My reports show the “big picture” and are used extensively by senior management as a map to chart company progress and plot future growth. A start-up firm gives me the opportunity to deal with a wide variety of issues.

From its infancy, I have had the chance to help shape E-Dak’s growth strategy. Once proving myself to management, I was given challenges beyond the realm of debits and credits, including managing a short-term investment portfolio, mplementing an information system, establishing a German joint venture, and financing a real estate deal. I derive much pleasure in overcoming each new challenge and cherish the knowledge and experience gained in each endeavor.

E-Dak has allowed me to develop working relationships with a premium community of finance and accounting professionals. I’ve gained insight into how accounting firm partners manage audit teams, how top-caliber investment bankers perform valuations, how banking officers approve funding requests, and how tax attorneys structure cross-border transactions. Additionally, the contacts I’ve made are invaluable to my career development. International exposure is imperative to success in today’s integrated global economy and I’ve also found it to be very enjoyable.

Enriching business travels with the CEO to Ireland, France, Germany, Japan, Hong Kong, and China have allowed me to visit museums and other places of interest, to talk with locals, and to observe other cultures. My direct supervisor, the CEO of E-Dak, fosters a set of values that reflects a confidence in, concern for, and desire for open communication with me and every ther employee. In offering us new challenges she gives her staff the opportunity to professionally evolve.

If an employee is faced with financial difficulty, she assists them with personal funds. All of this encourages a sense of nurturing and belonging. E-Dak employees share the same vision, work as a team, and care for each other like family. A common downside of family controlled companies is the tendency toward nepotism. Employees learn to become wary of an “untouchable” group of staff and feel they must continually consider the political implications in dealing with them.

I applaud the good natured intentions of a business owner to aid relatives, but at some stage in the growth of an enterprise, nepotism needs to be restricted. At E-Dak, if I were promoted to senior management position, I would have accounting launch a new measurement program which, if effectively implemented, can give managers objective feedback on employee performance and subsequently, cultivate a new management culture. In a position of greater authority I would continue to address this issue by emphasizing a clear body of employee standards and measurements.

Uleashing The Killer App: Book Report

Killer apps, goods or services that establish quickly and dominate the market, are displacing traditional planning and strategy in business. These revolutionary realities such as email, the first word-processing program, and e-commerce are sudden and dramatic changes that have recently found success in changing the face of business. Companies that use existing technologies are finding possible killer apps as a way to gain advantage over competitors and serve their customers in a more efficient manner.

Companies that choose to use existing, traditional ideals of strategy and planning are being passed over as the power of emerging digital solutions attracts their customers. Companies must now adopt a digital strategy to help produce their own killer apps to survive in their marketplace. This digital strategy encourages full staff involvement in the development of possible improvements in processes, rather than having a group of people who spend years developing strategies.

This full staff involvement brings together the ideas of workers on the front lines of production who have real world answers on how to make their work faster and eliminate non-essential processes. Once developed, killer apps take their market by storm. For example, electronic mail has established itself as the way of communicating notes and short correspondence over the traditional ways of writing letters. The US Postal Service has experienced extreme loses in revenue due to the hands of email. Killer apps will dominate a market quickly as customers find its advantages over traditional services and products.

Moore’s Law Moore’s Law, Metcalfe’s Law, and the economic theories of Ronald Coase help support the rise and domination of killer apps. Moore’s law focuses on the constant growth in computing power. The law states that for every 18 months, processing power doubles while cost holds constant. Killer apps are now able to constantly evolve faster, smaller, and more efficient while keeping costs somewhat constant. In 1980, a gigabyte of storage cost several hundred thousand dollars and took large storage space.

Moore’s law has made it possible to shrink cost to $200 and drastically reducing storage space to the size of a credit card. This ever-improving processing power will serve as the backbone to the future of killer apps. Companies that choose not to invest in these technological answers to problematic issues will soon find themselves at the bottom of the market. This leads us to Metcalfe’s law. Metcalfe’s Law Metcalfe’s law explains why technology spreads so rapidly, and how quickly people so readily accept it. R. Metcalfe is the founder of 3Com.

His law states that new technologies are valuable only if people use them. His concept is easy to understand. If only two people have email accessibility, email would not be very important. Only those two people could communicate with each other using electronic mail technology. If the entire office were given the same email accessibility, email would become much more important. The more people use something, the more valuable it becomes, which will attract more people to use it. A prime example of the validity of Metcalfe’s law is the Internet.

As more people use it, it will become much more attractive to others. Economic Theories of Ronald Coase The economic theories of Ronald Coase have produced many opportunities for smaller companies to compete easier with larger, more established firms. Coase believed that firms are set up to minimize transactional costs. A larger firm can produce products like steel at lower economies of scale and more efficiently than an individual. Existing corporations are now competing against the economies of cyberspace.

The economies of cyberspace significantly lower transactional costs more than traditional firms do because of the greatly reduced costs of land, labor, and capital. An online bank can offer as many advantages that traditional banks currently offer. This is because the transactional costs of an online bank are much lower. Their website serves as their “land” and their employees mostly work part-time. Clearly, Moore’s Law, Metcalfe’s Law, and the economic theories of Ronald Coase have provided a prosperous environment for killer apps to flourish in today’s society.

Killer apps will provide opportunities for many firms to find a new niche or service using digital technology that can help them revolutionize their markets. What is Digital Strategy? Traditional strategic planning techniques such as those published in 1980 in Michael Porter’s Competitive Advantage are very unsuitable for survival in cyberspace. In order to survive in today’s digital world, companies need to adopt what Downes and Mui call digital strategy. Digital Strategy is a new approach to strategic planning.

It consists of twelve design principles that guide the process for finding and developing killer apps, and techniques that organizations of any size and in any industry can use to achieve market dominance. It can be done by all companies, not just companies whose actual goods and services are already digital. Strategic Planning versus Digital Strategy In traditional strategy, the plan produced is mostly static. A team goes off for a period, performs its analysis, and returns with a document, which remains the plan until the next planning cycle.

This team is usually made up of only senior executives or the staff of a specialized department. Digital Strategy is much different. A digital strategy is a dynamic plan that requires constant rethinking. It is developed by everyone. Although, usually by line managers in large organizations or functional heads in smaller ones. The period for traditional strategy is between three to five years. As a direct result of Moore’s Law and Metcalfe’s Law, killer apps are entering the market quickly and reaching critical mass, the knee of Metcalfe’s curve, in less than two years.

For example, electronic commerce was not a part of any company’s strategic plan, not even Microsoft’s, two years ago, but now it is very popular in every industry. As of today, digital strategy takes close to twelve to eighteen months to implement, but that period is getting shorter as time goes by. Michael Porter wrote in his book Competitive Advantage that a company must gain advantage over at least one of the “Five Forces. ”  The “Five Forces” he spoke of are customers, suppliers, competitors, new entrants, and substitutes. Today, we have to deal with three new forces: digitization, globalization, and deregulation.

These “New Forces” supersede the old forces as the focus of planning. Traditional strategy is implemented through value chains. According, to Michael Porter, the value chain is the set of activities an organization performs to create and distribute its good and services. Each of these activities adds some value to the product, a value that Porter refers to as “margin. ”  The presence of the new forces is forcing companies to no longer be concerned with today’s value chain. Instead, they must consider destroying it altogether, rather than trying to improve it.

Dell & Supply Chain Management

Dell Computer is a leader in the e-commerce computer hardware market. It is an established brand that leads personal computer manufacturers both in U. S. sales and overall online sales. Its trademark method of selling products to customers, corporate and individual consumers, emanates from the Dell Direct model, a Web-enabled infrastructure that allows customers to customize their PCs and order other products they need or desire.

This virtual integration structure eliminates the need to manufacture everything, and instead uses the power of the Internet to share and exchange information with suppliers and vendors to build a truly superior supply chain that keeps inventory turnover low and costs to a minimum. The primary method Dell uses in order to achieve and sustain their competitive advantage is a unique, direct to customer business model. The model is known as Dell Direct, referring to their relations with their customers as being direct.

This model helps Dell focus on price for performance, customization, service and support, latest technology and superior shareholder value. Additionally, Dell is able to distinguish itself from its competitors with its customized on- demand manufacturing. With this customization, Dell is able to offer customers more value for their money by eliminating intermediaries in their procurement, manufacturing and distribution processes. Dells primary resources include the most up-to-date technology and IT tools that allow it to successfully move along their superior supply chain and achieve the value they strive for.

Dells value chain allows Dell and its suppliers to exchange information and interact with each other. The Internet, Dells key IT factor in its success, results in lower costs to customers than other retailers because customers tell Dell exactly what they want and Dell creates products for the consumer without experiencing wasteful resources in production. Overall, it is evident that Dells competitive advantage lies in its Direct model success. Through Dells IT performance, which combines its resources, its relationship with suppliers and its consumer communication capabilities, Dell has developed one big advantage over its competitors.

Research and Analysis Analysis of Dells Competitive Advantage: Dell is officially the No. 1 computer systems company in the world. Dell is able to sustain a competitive advantage over competitors in the computer industry because of an extremely efficient supply chain/distribution system. Dell is able to achieve superior profits in the industry because they are a knowledgeable user of information, communication, e-commerce, e-business, internet, and web technologies. Michael Dell states that Dell is so successful because of Knowledge Management.

Mr. Dell defines that term by saying physical assets are being replaced by intellectual assets. This relates to Dells inventory system. Dell implements a Just-In-Time inventory system which operates on only 6 days of inventory. Dell is able to achieve greater profit margins and increased profits because of their inventory system. Inventory and labor are the highest liabilities of a firm. Since Dell only operates with 6 days worth of inventory, they are able to cut costs on warehousing, hiring people to track and maintain inventory, and avoid holding on to obsolete technology.

This allows Dell to free up cash flow to invest in other value adding activities. Dell uses a JIT inventory system because Dells customers can only order computers directly through Dell itself. Dell uses their website www. Dell. com to take customers orders. Dell focuses on direct sales, cutting out other distribution channels entirely. This allows for a deeper relationship with the customers whereby Dell can offer their customers better service, savings, convenience, and efficiency. A customer can order their own custom computer, have it built by Dell in three days and have it delivered to the customers doorstep within one week.

Dells use of the internet has revolutionized the company. Dell makes their website extremely consumer friendly to offer an easy order process to the customers. Dell has also created their Premier Page. This page was made for Dells larger accounts including corporations, the Government, and educational institutions (ie Syracuse University). This webpage includes dynamic price upgrades, easier navigability, and a greater range of available upgrades/options. Customer relationship management software keeps close tabs on the types of computers that customers are buying (Pizinger).

Not only does Dell use the internet to make the customer ordering process easier. They also use the internet to build better relationships with their suppliers. In order for Dell to work off of 6 days of inventory, their suppliers have to be very involved in the company to make sure superior service is met. Dell uses state of the art production planning programs that forecast the quantities of components needed to build the computers. After those forecasts are made, supply chain systems pass those forecasts to suppliers, who respond with cost estimates and plan their production as a result (Solis).

To achieve their supply chain superiority, Dell uses solutions from i2 Supply Chain Management. i2 streamlines the supply chain by providing component suppliers and Dell planners with global views of product demand and material requirements. It also provides real-time factory scheduling and inventory management, so employees can generate key reports based on accurate and timely data, pinpoint inventory on the factory floor, and receive supplier deliveries on a true just-in-time basis (i2 supply chain management systems).

This allows Dell to change their manufacturing schedule every two hours to keep up with customer orders. Dells suppliers have access to this accurate, timely information. Since the suppliers work with facts instead of forecasts, this allows them to reduce waste and improve efficiency. Once suppliers receive this information, they are directed to deliver needed materials to a specific dock door for assembly for specific product manufacturing. Dell uses the Windows NT operating system and Intel-based servers for all of the i2 applications (Soral). Dells e-commerce is a huge part of their competitive advantage.

Their e-commerce internet infrastructure is so advanced and knowledgeable that by using it to determine trends and demands of their products, they have gained superiority over their competitors. Dell has set up strategic alliances with other companies to have their products sold on Dells direct selling distribution channel. Back in 2000, Palm, Inc. made an agreement with Dell to offer an expanded line of handheld Palm products and accessories. This agreement allowed Dell to drive momentum for the Palm operating system market (Dell: 2000, April 17).

Along with Palm, Xerox also partnered with Dell to take advantage of Dells e-commerce. Advantages to Xerox were increased profits by offering the printers with the Dell computers. Advantages to Dell include selling high quality printers along with their computers, but more importantly, it allowed Dell to be involved in the customer buying process for printers. Being involved in the decision making process is key to Dells success because they see directly what the customers want and determine their production schedule from that information (Dell: 2000, May 22).

Dell achieves its competitive advantage over other firms in the industry by having superior supply chain management. Dell utilizes technology to interpret information. By being involved in the customer buying process they are able to determine their customers needs. This allows Dell to streamline production and have close relationships with their suppliers which results in getting timely deliveries in order to mass customize customers computers. Analysis of Dells IT Tools: Dells supply chain management success can be summed up in one idea.

Supply chain management shortens the cycle between the component, the manufacturer and the end customer. We are allowing them to almost touch each other, (E-commerce) according to Michael Chong, e-business Technology Manager of Dell Computer Corporation. Supply chain management is the effective and efficient movement of materials from suppliers, through a company and into products, which eventually is received by consumers. An important goal for Dell is to enable customers to process their own transactions. Dell is known for their efficient and effective build-to-order business model.

This model allows customers around the globe to order customized systems from the dell. com website. Dells online supply management allows Dell, suppliers and customers to work together. As Michael Chong states, Because we work directly with customers, we have the ability to connect and understand what products will be required and when (E-Commerce). This helps Dell to inform their suppliers what supplies are needed based solely on customer demand. As a result, there is not an excess of supplies in warehouses that will decrease Dells efficiency.

As Dell is known for their exceptional service, ease in ordering and responsiveness to customers needs, their competitive advantage is easily distinguished. Dells internet presence through Dell. com, is an important factor in Dells success. By involving the customer from the beginning of the ordering process, Dell. com makes it easier to do business for both parties and initiates customer relationships while providing a means for ongoing customer service. With a number of links focused primarily on certain groups and customers, purchases can be made easily and efficiently.

No matter what you are purchasing, Dell. com can assist the customer in customizing and evaluating Dells offerings. Dell. com can help an individual consumer purchase a single notebook or can help larger companies purchase or lease products that will help them lower their costs. A new service, launched in the year 2000, made it possible for customers to purchase refurbished Dell PCs, notebook computers, digital cameras, scanners, printers and speakers online. The returned equipment comes from companies upgrading systems but wishing to continue using Dell gear, or from cancelled order (Kelsey, 2000).

Specifically, Dell has enhanced its supply chain by using i2 Supply Chain Management to plan orders and communicate with suppliers every two hours. This results in Dells efficiency in manufacturing and delivering exactly what its customers want. Time to deployment and overall cost of ownership can be achieved if i2 Pronto and/or i2 Solutions for Value Chain Management are utilized, along with Dell servers and storage. i2 Pronto is a rapidly deployed solution for factory planning and collaboration. Dell possesses a competitive advantage in that they are currently the only hardware platform certified for rapid deployment of i2 Pronto solutions.

Solutions enables Dell to reduce costs, lower total cost of ownership and establish a reliable, stable operating environment. Dells own implementation of i2 SCM solutions is known as the DSi2 system. DSi2 runs on 120 Dell servers and manages more than 250 suppliers delivering more than 3500 parts. As a result, Dell can deliver customized, replicable configurations, reducing time to deploy and cost of ownership. i2 solutions also enables customers to put Dells value chain to work in meeting company goals and attaining value (Jacobs, 2003).

SCM streamlines the supply chain by providing component suppliers and Dell planners with global views of product demand and material requirements. It also provides real-time factory scheduling and inventory management so employees can generate key reports based on accurate and timely data, pinpoint-inventory on the factory floor and receive supplier deliveries on a true just-in-time basis (Harrington, 2002). This system allows Dell to achieve a new manufacturing schedule every two hours which shows the latest customer orders, backlog numbers, stock status and supplier commitments.

Today, the supply chain of Dell not only runs on 120 Intel-based Dell servers running Microsoft Windows NT, but it also has four primary i2 software modules: i2 Collaboration Planner Demand Fulfillment, Global Supply Planning, Factory Planner and Supply Chain Planner (Harrington, 2002). This success proves that Dell has the best of both worlds. They achieve state-of-the-art performance at an economically attractive price. A competitive advantage is seen when a company, such as Dell, links supply chain management with customer relationship management and supplier relationship management.

This link is known as DVCM (Dynamic Value Chain Management). DVCM requires synchronized, multi-enterprise collaboration based on streamlined decision-making workflows across companies. It requires companies to push planning and execution toward real-time or near-real time. DVCM’s net result is a fundamental change in the relationship between companies and their trading partners–a change that creates tremendous value for companies, their trading partners and their customers (Harrington, 2002).

When Dell utilizes its i2 SCM strategy, Dell can model and monitor their business in real-time, and analyze issues such as sourcing, distribution, resource and capacity constraints (Harrington, 2002). Some of the capabilities of DVCM are collaborative demand planning with customers and suppliers, auto-replenishment of inventories, design information sharing with strategic partners, content management and distribution with management. After these are implemented, organizations are able to make decisions in a timely manner and implement those decisions for completion of the products.

Another important role for Dell is the use of the Internet. The Internet helps Dell to establish good relations with both their suppliers and their customers. Not only does Dells use of the Internet allows customers to customize and purchase Dell products online, the Internet also helps suppliers and Dell communicate and focus on improving their efficiency. This method began in mid-1999 when Dell introduced valuechain. dell. com. This website allows suppliers to follow their material as it as used throughout Dells operations.

Suppliers can log-on, drop off invoices, check engineering change orders, review negotiated and forecasted cost reports, and track their overall performances and progress. As a result of their successful Internet system, Dell purchases almost 90 percent of its direct material supplies online. Supplier hubs located near their manufacturing plants are used to deliver supplies to the Dell plants when they are only a few hours old. As said by Michael Chong, We are trying to draw more value out of our supplier relationship. Thats why the name value chain. The applications themselves are not replacing the business processes.

The business processes are already defined and well ingrained. It is just making the business processes more efficient (E-Commerce). By focusing on inventory control with their suppliers, Dell is able to use industry price declines to their advantage and deliver those savings on to the customers. This also gives Dell a competitive advantage. According to Michael Chong, Our competition has a hard time trying to manage that type of model because their inventory turns are fewer. They have more latent costs built into the components in terms of their inventory (E-Commerce).

An efficient supplier network is important to Dell. In order to increase efficiency between Dell and their suppliers, Dell has reduced the number of suppliers they do business with. Three years ago, Dell worked with more than 1,000 suppliers, but today they only work with 100 suppliers. Dell also uses supply chain management software to reduce inventories, improve material management and enhance relationships with suppliers. This also helps Dell and their suppliers connect to share information about inventory and improve efficiency, which gives Dell an additional competitive advantage.

Zorlu Holding And Vestel Electronics

Mehmet Zorlu, established their Group’s first company in the early 1950s, he laid the ground rules for the Zorlu Group’s subsequent growth: integrity, perseverance’ and unconditional commitment to quality. Integrity is the Group’s cornerstone value and they expect it to govern every aspect of their business. Hard work and perseverance are essential for the day-to-day success of their enterprises as they are for the undertaking) of a new venture. Quality is the key to customer loyalty, on which the long-term prosperity a f all ventures depends.

With these ground rules, the Zorlu Group has sought to develop solid and profitable businesses that contribute to the welfare of the Group; its customers, business partners and employees; as well as the larger community. Until the early 1990s, they focused their investments in home textiles, an activity the Zorlu family has been involved with for several generations and in which they have a particular expertise. In 1994, they saw the opportunity to employ their strong capital and human resources in the consumer electronics sector, through the acquisition of the Vestel electronics Group.

This was followed, in 1996 and 1997, by investments in the fast- growing energy and financial services sectors. Between 1990 and 1997, they tripled the number of their operations, increasing their total assets to just under US$ 1 billion, excluding the assets of five of their six subsidiaries incorporated abroad. They invested in state-of the-art spinning, weaving and textile technology that has made them the world’s largest; vertically-integrated polyester curtain producer and will propel them to the forefront of the international home textile industry in the years to come.

They acquired the Vestel Group of consumer electronics companies, pushed its balance sheet from an undeserved red into the black, and set it on course to become a leading contender in the international consumer electronics markets. They established a bank, a leasing company and o factoring firm and they penetrated the power generation and electricity distribution sectors with the construction of two plants and a; competitive bid for o state- owned, plant slated for privatization.

The Zorlu Group’s rapid growth since 1990 reflects the vast range of opportunities that have emerged from the unique juncture of Turkey’s Customs Union with the European Today, their operations include 32 companies in Turkey, France, Germany, Holland and South Africa in the textile, consumer electronics, finance, energy and tourism sectors. In 1997, their key operations achieved net sales of almost US$ 750 million and after tax profits of just under US$ 80 million.

That the Zorlu Group was able to choose its projects well and bring these to successful fruition during a period of significant economic and political uncertainty is a reflection of their strategic corporate vision, their sound business principles and their strong management capability. Mehmet Zorlu, a textile manufacturer with a vision of Turkey’s textile potential long before their country had made its mark on international markets, founded the Zorlu Group of companies in the early l950s.

At an early date, Mehmet Zorlu endowed the Group with o rare combination of values honesty, dedication to quality, commitment to long-term goals and the courage to take calculated risks that reward hard work. Today; these values are the foundation o f their corporate culture and constitute the basis for their key business principles unconditional customer satisfaction and mutually beneficial partnerships. The Zorlu Group is committed to constantly improving the quality and enhancing the range of its products and services.

That is why they have sought to expand their product range in the consumer goods categories where they are active and to ensure, through ceaseless research and development, that their products best reflect the demands of their consumers and the latest technological developments. Likewise, they are committed to developing strong and long-term relationships with their customers, their employees, their suppliers and their shareholders. Their aim is to provide their customers with high quality products and services, to exact specifications and on competitive terms, and they expect their suppliers to do the same for us.

They also expect their human resources to be the very best in their areas of expertise, so they have set an unlimited budget for training to help them achieve this performance. First-class human resources are essential if they are to achieve the strong financial results that their shareholders deserve and which their recent performance confirms they can attain. They are proud of their achievements over the last decade, but they are not prepared to rest with these. (Zorlu Holding Company Profile) The Goal Of The Zorlu Group

To strengthen their global reach, from the Far East to the American continents, through strategic and long-term partnerships, care fully planned investments at home and abroad and focused research and development. The Zorlu Group is always open to exploring strategic partnerships that will expand their international markets, enhance their product range and contribute to their technological know-how. Currently, they are considering several long-term partnerships in consumer electronics for research and development, technology transfer, customized production and manufacturing facility sharing in international markets.

The Zorlu Group’s investment strategy To reinforce its capacity, technological lead and vertical integration in its primary areas of activity while creating new capacity in selected high-growth sectors. In the textile sector, they hove invested more than US$ 500 million in several projects that will more than triple their polyester yarn capacity and double their curtain fabric output, These include a vertically-integrated, cotton-based home textile plant that is the world’s third largest in terms of capacity and unparalleled in its cutting-edge technology.

In South Africa, they initiated construction o f a manufacturing facility that will come on stream in 1998 and supply the fast-growing demand for curtain fabric in the region. In France, they acquired majority shareholding of Bel-Air Industries, one of the largest home textile producers in Europe. Bel-Air has three manufacturing facilities, a wide range of internationally renowned brands and a distribution network of 5,000 dealerships in France and Germany.

In the consumer electronics sector, they have expanded their television production capacity four-fold since 1995 and more than doubled their capacity for television components tuners, remote controls and satellite receivers. At ‘ the same time, they have incorporated new technologies that have enabled them to launch innovative products; such as. wide-screen televisions and information appliances, They have also initiated construction of a new manufacturing plant that will produce static and no-frost refrigerators under Sanyo license in-early 1999.

While deepening their traditional lines of business, the Zorlu Group has expanded into new areas of activity where they believe they have a competitive advantage. Their decisive entry into the financial sector reflects their conviction that they have the human resources; the international standing and the capital strength to become one of the top five mid-sized financial groups in Turkey. Their US$ 150 million investment in power generation, motivated by the Group’s large demand for high quality and economical energy, has prepared them to compete for Turkey’s large-scale energy privatization projects. The Zorlu Group is not afraid to grow because they believe they choose their projects prudently, but they also recognize that growth must be managed. That is why they are investing in their human resources, reinforcing their management capability with integrated business software and drawing heavily on external consultancy. ” They are not embarrassed to learn from others how to strengthen their business. Nor do they shy away from licensed technology.

On the contrary, they prefer to learn as much as they can from others because they can then focus on what they do best; making better products, providing higher quality services and improving the return for their shareholders. Turkey is a country, which has an incredible opportunity, though its potential has recently been clouded by economic and political instability and one of the highest inflation rates worldwide. Having confirmed what they can achieve in this difficult environment, they are confident in the Zorlu Group’s future and look forward to sharing this with the customer. (http://www. orlu. com. tr) CONSUMER ELECTRONICS DIVISION The VESTEL Group In 1994, the Zorlu Group became a leading contender in the consumer electronics market when it acquired, Vestel Electronics. Founded in 1984, the Vestel Group comprises four manufacturing and six marketing and distribution companies in the consumer electronics, white goods and information technology sectors. The Group’s products include color televisions, personal computer monitors, set-top- box satellite receivers, personal computers, television tuners, remote control units, remote control converter kits and Internet boxes.

In 1999, the Group will initiate production of no-frost and static refrigerators. The Vestel Group has been at the forefront of Turkey’s consumer electronics sector since I 984, when it established Vestel Electronics, currently one of Europe’s leading color television producers specialized in OEM. In the following years, the Group expanded vertically into television components, and horizontally into information technology and white goods. Vestelkom, the Group’s components producer, is Europe’s fourth largest manufacturer of television tuners.

In 1987, Vestel established one of Turkey’s first computer assembly operations and subsequently initiated the design and production of monochrome and color PC monitors for export. Vestel’s history in the white goods sector dates back to I 988, when the Vestel Group established a joint venture with a leading Asian durable goods manufacturer to produce microwave ovens, later expanding into production and marketing agreements for refrigerators, washing machines, dishwashers and mini electric ovens.

After nearly a decade of rapid growth, the Vestel Group suffered a brief period of decline under- its previous owner in the early I 990s. This situation was rapidly and decisively reversed by the Zorlu Group, which brought to the Vestel Group new capital resources, an experienced, and entrepreneurial management team and a new focus on quality and customer satisfaction. Between 1995 and 1997, Zorlu Group invested more than US$ 40 million in expanding and modemising the Vestel Group’s capacity and in business reorganization.

Over the same period, the Vestel Group raised its consolidated net sales and exports by respectively 148% and 190% in US$ terms and its after-tax earnings by more than 500%. The Vestel Group’s rapid recovery reflects its majority shareholder’s commitment to unconditional customer satisfaction through new and improved products, greater product features and accessible prices. It also reflects the far-sighted manufacturing strategies of its management team. (http://www. vestel. com. tr) Vestel’s manufacturing strategy “Quality, innovation, and quick response. To support this, the Group is continually investing in new technologies, new capacity and greater production flexibility. At the same time, it has pursued vertical and horizontal integration to enhance its control over the final quality of its products and to optimize scales of production. This strategy has enabled Vestel to secure its position as a first-class original equipment manufacturer. Vestel has the production flexibility to meet a wide range of specialized needs and the strict quality controls to ensure consistently high quality products.

Because it is continually investing in new technologies, Vestel is able to launch new products and product features that reflect the very latest trends in the international markets. The Vestel Group’s technological park includes state-of the-art surface mounting and plastic injection machinery, nitrogen-environment automatic soldering machines, quick proto-type machinery and automatic micro-controller software. This advanced technological base is buttressed by the Group’s engineering expertise and in particular, the technical know-how of its research and development teams.

Vestel’s research and design team was the first in Turkey to develop its own television design and the only one to develop micro- controller software for application in its production processes. Currently, it is focusing its efforts on flat panel (plasma display) televisions, line flicker and noise reduction, Dolby sound systems, digital interactive television units, digital video disk players, digital video disk broadcasting decoders, multimedia monitors, video conferencing and chip design.

Vestel Electronics The Zorlu Group’s principal operation in the electronics sector is Vestel Electronics, one of Europe’s leading manufacturers of color televisions. In 1997, Vestel Electronics produced 2,200,000 color televisions and supplied respectively 7. 5 % and 32% of the European and Turkish color television markets. In 1998, the company is increasing its capacity to 4,000,000 units. Vestel Electronics ‘is also the largest producer of personal computer monitors in Turkey, with an annual capacity of 1,000,000 units, and the only manufacturer of desktop personal computers with ISO 9002 certification. Zorlu Holding Company Profile) Vestel Electronics’ goal Become one of the world’s top three consumer electronics companies. Vestel Electronics is a publicly traded company with 33% of its shares traded on . the Istanbul Stock Exchange; The Zorlu Group owns the remaining 67% shareholding. In 1997, Vestel Electronics ranked among Turkey’s top 10 private enterprises with a turnover of US$ 516 million. Since its establishment in 1984, Vestel Electronics has pioneered the development of the Turkish electronics sector with innovative and high quality products and internationally competitive prices.

After its acquisition by the Zorlu Group, Vestel Electronics embarked on a new period of growth, raising its color television capacity from 400,000 units in 1994 to 2,200,000 units in I 997 and 4,000,000 units in 1998. This rapid expansion has enabled the company to incorporate the latest technological developments in its production processes and to reorganize its productive capacity to best meet the demands of its international clients. Vestel Electronics’ I 00,000 m2 television plant is located in the Organized Industrial Zone of Manisa, 30 kilometers from the Aegean port of Izmir.

The plant employs over 3,000 people and encompasses, all phases of the television production process: research and development; production of printed circuit boards (PCBs), chassis and cabinets; testing and mounting of the final product; production of packaging material and after-sales services. Vestel Electronics sources its chip tuners and remote control units from Vestelkom, another Vestel Electronics Group company. (http://www. vestel. com. tr) Vestel Electronics’ production lines incorporate state-of-the-art surface mounting assembly technology and fully automated testing processes.

Advanced production technology, strict production process controls and a high degree of vertical integration ensure that Vestel’s television sets are of consistently high quality that meet or exceed international standards. Vestel Electronics has a first-class manufacturer’s return rate. Vestel Electronics’ excellent product quality is complemented by an exceptionally high degree of production flexibility. Vertical integration, a strong research and development base and in-house engineering expertise enable Vestel Electronics to produce both small and large batches of customized television sets in record time.

Utilizing pro-engineer CAD/CAM software and prototype machinery, the company can produce full-size models in three to four days and initiate full production in less than one month. Vestel Electronics’ research and development team is preparing to take the lead internationally through licensing agreements with some of the world’s foremost engineering firms and strategic collaboration with several of Turkey’s top technical universities. These partnerships have reinforced the company’s traditional leadership in Turkey and set the stage for new product launches on an international scale.

Vestel Electronics was the first producer in Turkey to produce 100 Hz televisions and the only producer of 16:9 inch, 33-inch, Dolby Surround PrologicTM and digital televisions as of end-1998. In 1998, the company is launching Turkey’s first Internet set-top-box television, Internet. TV. All of these have been designed to meet the technical specifications of Vestel’s key export markets in Europe, Asia, North and South America and Africa, CIS and Australia.

Other areas where Vestel Electronics is focusing its research and development efforts are flat panel plasma display) televisions, line flicker and noise reduction, Dolby sound systems, digital interactive television units, digital video disk players, digital video, disk broadcasting decoders, multimedia monitors, video conferencing and chip design. Vestel Electronics has established an in-house EMC laboratory for CE testing and its research and development team works, closely with authorized certification laboratories to assure that new products meet or exceed. ll required international standards. All of the company’s televisions are produced to BEAB, BS, CE, UL, FTZ, LCIE, TUV and VDE standards as well as to the individual standards of its export markets. Vestel Electronics has been operating with ISO 9001 certification since 1993. (Zorlu Holding Company Profile) Vestelkom Vestelkom is a contract manufacturer for the telecommunications industry and Turkey’s leading producer of television tuners, satellite receivers, remote control receiver/transmitter units.

Since early 1998, it is also the only producer of Internet set-top-boxes in Turkey. Vestelkom’s new 20,000 m plant in the Aegean Free Trade Zone near Izmir has the largest component surface mount assembly operation in Turkey, Moreover Vestelkom’s 2,400,000 surface mount device (SMD) chip tuner capacity, as of-end-1997, positioned the company squarely among the top four television tuner producers in Europe. Vestelkom’s leadership in the tuner segment reflects its long experience in the consumer electronics sector and in-house engineering expertise.

Founded in 1975 Vestelkom was Turkey’s first consumer electronics company to produce tuners and remote control unitsfor both monochrome and color televisions and to introduce surface mounting of components. In 1989, Vestelkom began to produce television tuners under Temic license, exporting 100% of its output to his company. Today, Vestelkom continues to export all of its tuners and is forcefully expanding its exports of satellite receivers and remote control units, the latter to countries in the Middle East and Africa where large numbers of television sets are still manually controlled.

To respond to the growing demand for its products, Vestelkom is rapidly expanding both its production capacity and its product range. Vestelkom’s production lines utilize state-of-the-art Fuji and TDK assembly machinery and the latest generation of testing and alignment equipment. Manual and automatic testing is complemented by statistical process controls to ensure that every one of Vestelkom’s chip tuners are produced in line with FTZ and CCIR standards. The company expects to reconfirm its high standards of quality with ISO9002.

As with Vestel Electronics, Vestelkom has developed its own in-house research and development capacity. The company is currently designing satellite receivers, with two analogue receivers under production and one in the development stage. Vestelkom is also on the design for a new remote control transmitter unit with chip-on-board. In the longer run, Vestelkom aims to develop and manufacture products for radio frequency and digital telecommunications. Vestel White Goods was established in 1997 following the group’s successful launch, in 1996, of the VESTEL WHITE brand to the Turkish market.

Vestel White Goods is the Group’s first manufacturing investment in the white goods sector since the Zorlu Group acquired the Vestel Group in 1994. Vestel White Goods is constructing a US$ 100 million static and no-frost refrigerator plant that will have an initial capacity of 600,000 units in early 1999 and a final capacity of 1,200,000 units on its completion at-end-2000 Sanyo of Japan is providing the technical know-how for the plant, which has been designed with a flexible production structure to facilitate customized production.

This flexibility, combined with state-of- the-art technology, will enable the plant to export roughly half of its output to Europe, the CIS, North Africa and the US. Vestel Goods plant is located in the Manisa Organized Industrial Zone Near Izmir. In line with its strategy of developing capacity in the white goods sector, Vestel White Goods is initiating two more manufacturing investments in mid 1998. The first of these is a US$ 80 million facility for producing fully-automatic washing, machines that will have a capacity of 1,000,000 units when it begins operation in the second half of 1999.

The second is a US$ 30 million split air conditioner plant that will have a capacity of 250,000units when completed in early 1999. (Zorlu Holding Company Profile) Vestel Information Technology Vestel Information Technologies provides information technologies services in Turkey as a member of Vestel Group Companies within Zorlu Holding since 1987. It provides information technologies services worldwide by establishing Vestel-USA; the first global company ever established by Turkish capital in Silicon Valley, California, USA.

North and South American operations are managed from the Silicon Valley, European, Middle Eastern and African operations are managed from Turkey and Asia-Pacific operations are managed from Taiwan. Vestel does not only follow the produced, ready made technologies. Three R&D centers were established by the company, one of which is in Silicon Valley where the technology develops rapidly in USA, second one in Taiwan and the other one in Manisa, Turkey. Vestel R&D departments play an active role in electronics and computer technologies with its new technologies and methods.

Today, the opportunity to develop technologies completely cooperation with the leading companies in the field. Therefore, Vestel was established cooperation with giant corporations such as Microsoft, Sun Microsystems, En Reach Technology, SPYGLASS and Integrated Systems in Software field and with Intel, Teralogic, Information Graphics Systems Inc. , Cyrix, GEMPLUS in hardware field and the company continues to conduct can only be possible by establishing strategic cooperation with the leading companies in the field. http://www. vestel. com. tr) Vestel Information Technologies have renewed its internal organization to reflect the technological excellence arose from this giant organization and synergy generated from the local information technologies and four giant group companies providing Internet services directly to the customer satisfaction. The new organization consists of two operational groups, one of which is Individual Systems and the other is Corporate Systems.

Vestel Information Technologies is proud to provide services to Turkish citizens as the Turkish Division of this giant organization with its information devices equipped with new technological excellence, product ranges, channel structure formed of distributors, dealership structure and widespread sales points, 40 effective service networks in 24 provinces, specialized partners, unique field knowledge and Promega product range designed for corporate market.

Vestel Information that is in the information sector since 1987 is now provides services in personal computers’ market by the launch of Vestel Asteo PCs in1996 and corporate systems’ market by the launch of PROMEGA product range. The company ensured the “plant production” concept to be used in computer production field with the product quality provided by the input, production, post-production quality control, heat, electrical and mechanical tests and advanced production technologies. The company achieved to meet the world standards in the production of every single computer and enhanced the quality standards by the special tests conducted.

The new computer plant established in Izmir will start its operations on June, 1999 and the investments will be continued to provide production of world class PCs. Vestel started to produce monitors in 1988 with the production of monitors to IBM. The company started to produce Vestel design monitors as of March 1998. It reached to a capacity of 250K monthly on 5 assembly bands at its plant in Manisa on May, 1999 and it aims to posses a local market share of 80%. Annual target of the company including the exportation is 3 millions.

Vestel electronics Monitor Plant is the new indicator of Vestel’s investments in IT field and its identification of being technology producer not consumer. VestelNet VestelNet was established in 1997. Primary vision of Vestel Net Growing at a high rate in coming years. Mission of Vestelnet Serving this Network Society and create value for the investors by satisfying the needs of the Network Society. To this end, VestelNet is investing in state-of-the-art ISDN technology to create one of Turkey’s strongest digital Telecommunication backbones.

The backbone comprises a private, frame relay wide-area network, using SDH equipment, with bandwidths up to 622 Mb per second. This type of bandwidth will enable rapid and secure transmission of data as well as high quality video and audio conferencing. VestelNet has also donated a building to the national communication company, Trk Telekom, for a new switching office. Located near VestelNet’s main systems center, the switching office will ensure that Trk Telekom can handle VestelNet’s large volume data flow.

Another objective of Vestelnet’s advanced telecommunications infrastructure is to facilitate the rapid and reliable transmission of information between all the Zorlu Group companies and external information providers. Concurrently with this objective, VestelNet is assisting individual Group companies strengthen their links with key customer accounts. Here, VestelNet is developing a technology platform that will allow Denizbank, the Zorlu Group’s bank, to offer Internet-based banking services. A similar project will link Vestel Marketing on-line to its nation-wide network of brown and white goods dialers.

In addition to developing and managing the Zorlu Group’s wide-area network, VestelNet plans to open its telecommunication backbone to large corporate clients that require efficient, fast and secure data transmission services and to provide Internet services to the general public. VestelNet has tree platforms for accessing the Internet TTNet, satellite link of the Dexar Comm. Multimedia, Global satellite links Turnet, the national fiber optic network, and direct satellite links. VestelNet has the capacity to handling over 100,000 customers, 88 MBit of Internet access bandwidth and over 10,000 access ports. http://www. vestel. com. tr) Vestel Durable Goods Marketing Vestel Durable Goods Marketing sells and distributes the goods throughout Turkey either manufactured or imported by Vestel Group of Companies. Founded in 1986, the company is one of the most common distribution channels in the business. It currently has 3000 dealers, out of which 150 are exclusive show rooms. Focused on the continuous development of product range, Vestel Durable Consumption offers the latest technological innovations to consumers.

Recently, Plasma TV, 100 Hz TV, Super black series TVs, No-Frost refrigerators, air conditioners and hi-fi products are introduced, thus the product range is widened. Vestel Durable Goods Marketing A. B. is increasing its market share thanks to innovations. In 1998, the share of Vestel Marketing A. B in TV market realized as 30%, 7% in Audio and 5% in white goods. Vestel Durable Goods Marketing’ s mission is to offer service to its customers both on pre-sale and after sale basis. Thanks to Call-Center, the information related to products and services are simply made available.

A total of 690 service centers and their experienced staffs throughout Turkey offer after sale services. As a result of the synergy created among units, the information flow is ensured, thus the company may efficiently and rapidly respond to market developments. In today’s global world, the company follows up the latest trends and implements the innovations, which are considered feasible. Vestel Marketing A. B. also pursues investments in continuous development of distribution channels. (Zorlu Holding Company Profile) Their management’s point of priority To satisfy their employees.

In this regard, they are carrying out their operations with their dynamic, experienced and qualified personnel in order to reach pre-established goals. In addition, they are offering the best service to final customers by implementing the most recent marketing methods and focusing on how to offer extra value. The reason is that the customer priorities are continuously changing in recent years. Their mission Going beyond the current expectations of their customers, they are focusing on new marketing activities, which are at the same time encouraging sales.

The main objective of Vestel Marketing To prepare for the era called “Customers Who Will Never Satisfy” Because; the customer priorities are rapidly changing in all markets. In this regard, they are offering quality products at reasonable prices and payment conditions by exceeding their expectations via their effective distribution channels. The developments in information processing and communication fields have accelerated the elimination of trade borders, despite the political ones.

As a consequence of Vestel Marketing’s dynamic structure, they have left the traditional was behind and turned into a firm which sets the market standards by forming “creative strategies” and making innovations. (http://www. vestel. com. tr) Vestel Foreign Trade Vestel Foreign Trade was established in 1986 to promote the export of Vestel group products, principally color televisions and, more recently, monitors and satellite receivers. In 1997, it as one of Turkey’s top five exporters with revenues of US$255 million and in 1998; it aims to increase these to US$ 700 million.

The professionalism of this marketing and sales organization and its Aggressive approach growth and rising market shares in major European markets. Between 1994 and 1997, the Vestel Group increased its exports by 450% to 1,600,000 units and its share of the highly competitive European television market from less than 1% to 7,5%. In 1997 alone, Vestel Foreign Trade doubled its export markets to over 80 countries in Europe, the CIS, Asia, the Middle East, Africa, and South America. In 1998, it will initiate large-scale exports to the US, Canada, China and Australia.

In addition to penetrating new markets, Vestel Foreign Trade will initiate exports of a new range of high-technology products in 1998, such as PC monitors and information technology devices. With the worldwide launch of its Internet set-top-box in early 1998. Vestel has become one of the Global pioneers of this market segment. (Vestel Company Profile) Vestel Foreign Trade’s marketing strategy To supply,” value for money” products at internationally competitive prices, payment terms and delivery times.

Vestel Foreign Trade strives to meet or exceed the specifications of its customers and to anticipate future developments in consumer preferences through close and constant observation of its key export markets and large retailing chains. Vestel’s large retailing accounts include Quelle and Schneider in Germany, Alba in the UK and Carrefour in France. These alliances offer customers just-in-time delivery of customized designs under their own label while securing for Vestel extensive distribution and after-sales services in its target markets. International Marketing

Vestel Holland BV in Rotterdam, Vestel France SA in Paris and VesegGermany GmbH in Saar rcken support Vestel Foreign Trade’s marketing and sales activities in Europe. In 1999 Vestel Group will establish marketing companies in Spain, Italy and the US. Vestel U. S. A Established in 1998, Vestel Information Appliances Division innovator and manufacturer of a complete family of Internet Information Appliances and is the only North American manufacturer to offer flexible, easy-to-use, Internet-centric hardware solutions for the home and business markets.

Vestel Information Appliances Division is based in Mountain View, California and is a wholly owned subsidiary of Vestel, Inc. with European, Middle East & Africa headquarter located in Istanbul, Turkey. Vestel Visecon Vestel Visecon founded in September 1998, with a strong management view and enthusiastic, dynamic consultant team, which has extensive experience implementing, SAP in major projects within the Zorlu Vestel Holding Group of Companies. Company’s culture is based on honesty, dedication, handwork and quality.

Vestel Visecon aim is to focus on business performance improvement through Enterprise Resource Planning, Supply Chain Management and related products & services. Company started their projects in the second half of 1997 with a core team. In four months company completed Vestel Marketing, Vestel Bilibim and Zorlu Linen projects and five SAP/R3 modules were implemented HR, FI, CO, MM, SD. In the first quarter of 1998 Vestel Electronics project was started and FI, MM, SD, CO, PP, HR modules are implemented in 8 months.

Dexar Dexar Multimedia and Telecommunications was established in early 1998 for the servicing in communication technologies and it is the first company which has signed “Turksat Digital Satellite Platform” agreement with Turk Telekom on March 5, 1999 Dexar is established to introduce digital data transfer technologies via satellite for consumer and corporate users. Dexar has came together with Hughes Network Systems, USA and Raytheon Training Inc. as a strategically alliance.

Dexar will provide the following Multimedia and Telecommunication services with DVB (Digital Video Broadcast) technologies. Direct Pc Services / Turbo Internet BARRACUDA/SPEEDWARE Package Delivery,Multimedia, Webcast, Newscast BOD (Bandwidth On Demand) ISBN-IP (Integrated Satellite Business Network) The vision of the Dexar is; depending on the bulk transponder capacity of TURKSAT 1-B satellite; To spread usage all over the country combining the content of multimedia and fast and wide spread communication technology according to the needs,

To provide communication availability in requested bandwidth and time period, To offer high quality telecommunication possibilities in Turkey by making these services available for all companies in anywhere and anytime. Some of the applications; Turbo Internet Interactive Distance Learning TeleMedicine/TeleEducation Voice, data and video transmission in close networks (point to point, point to multipoint) Inteleconference Multimedia applications Broadcasting (Webcast, Newscast) (Vestel Company Profile) Vestel Human Resources Philosophy

Following the principles embodied in their Credo ” The Human First” they are building up an environment at VESTEL where all of their employees will be working productively, where there is no discrimination of any sort and where the relations are based on mutual respect and trust. They are aware that the most important element of their continual development is the intellectual capital they possess in VESTEL. Above all, what gives VESTEL its reputation is its hard working, top quality professional cadre.

Their aim is to have a common signature, as the Vestel family, under all the great successes and to move ahead altogether successfully. Everyone in Vestel is the leader in his or her area; their flexible organization structure gives everyone the opportunity to have his or her own initiative and to have the responsibilities in their areas. Vestel Human Resources vision By empowering all the VESTEL employees, to transform them into experts in human resources field and to elevate VESTEL to a level where there will be no need for a Human Resources Department. (Zorlu Holding Company Profile) Zorlu Holding And Vestel Electronics

Nike Inc., Research Paper

Basketball players “wanna be like Mike”, but shoe companies “wanna be like NIKE. ” NIKE is the worlds #1 company and controls more than 40% of the US athletic shoe market. The company designs and sells shoes for just about every sport, including baseball, volleyball, cheerleading, and wrestling. NIKE also sells Cole Haan dress and casual shoes and a line of athletic wear and equipment, such as hockey sticks, skates, and timepieces. In addition, it operates NIKETOWN shoe and sportswear stores and is opening JORDAN in store outlets in suburban markets.

NIKE sells its product to about 19,000 US accountants, in about 140 other countries, and online. Chairman, CEO, and co-founder Phil Knight owns. Nike Co. is very interesting, as well is a popular brand. Nike, pronounced NI-KEY, is the winged goddess of victory according to Greek mythology. She sat at the side of Zeus, the ruler of the Olympian pantheon, in Olympia. A mystical presence, symbolizing victorious encounters, NIKE presided over history’s earliest battlefields. A Greek would say, “When we go to battle, and win, we say it is NIKE. Synonymous with honored conquest; NIKE is the twentieth century footwear that lifts the world’s greatest athletes to new levels of mastery and achievement. The NIKE “swoosh” embodies the spirit of the winged goddess who inspired the most courageous and chivalrous warriors at the dawn of civilization. Among artistic representations of Nike are the sculpture by Paeonius (c. 424 BC) and the “Nike of Samothrace. ” Rhodians probably erected the latter, discovered on Samothrace in 1863 and now in the Louvre Museum, Paris, about 203 BC to commemorate a sea battle.

Excavations have shown that the sculpture was placed alighting on a flagship, which was set in the ground in such a way that it appeared to float. If you were to break the word NIKE down, you would get Ni-key. The pronunciation for Nike is nI-kE. Its function is noun, and its etymology is Greek NiKE. If you defined the word NIKE, you would find out that it means the Greek goddess of victory. Another meaning and definition of a word is SWOOSHING. Main entry: Swoosh, function is noun, and it is an act or instance of swooshing. The origin of the swoosh dates back as far as 1971.

Phil Knight was supplementing his modest income from Blue Ribbon Sports Inc. by teaching an accountant class at Portland State University. There he met Carolyn Davidson, a graphic design student, who was working on a multi-perspective drawing assignment in the hallway. He offered her a couple of bucks per hour if she would do some design work for his small company. This all happened because “Representatives from Japan were coming for a presentation and Phil wanted some charts and graphs to show them” according to Davidson. Apparently this wasn’t the last time Phil had asked Carolyn Davidson to create a design for him and Blue ribbon Sports.

According to Davidson again, “Phil had asked her to work on a shoe stripe because supposedly Phil needed more inventory control. ” (In spring of 1992, the first shoe with the Nike Swoosh was introduced) There have always been numerous predictions and questions asked about what Nike pays its people. An average salary for a Nike Spokesman (Tiger woods) is $55,555 dollars per day, which adds up to 20,277,575 dollars in a one years earned salary. Other salaries of Nike employees such as an Indonesian factory worker who is making shoes makes $1. 25 per day and an on average of $456. 5 per year. Lastly, Nike CEO Phil Knight is worth roughly over $5. 8 billion dollars.

Nike ads like any other businesses require interpretation. Some of this reading goes on at the conscious level, some unconsciously. As opposed to extremists on either side of the interpretative question, I fall most nearly to the constructivist point of view in that I view meaning as interplay between text and the reader. Ads work on a variety of different levels including, but not limited to, sign typology, paradigmatic meaning, psychological appeals, emotion, roles, values/beliefs, and knowledge.

Again, the impact of an ad comes from the interplay between these various aspects of make-up and the reader’s own notions about him/herself and the world. Rubber-soled shoes were first mass-marketed as canvas-top “sneakers” by U. S. Rubber, with its keds in 1917. But the elevation of athletic shoe manufacture to both a science and a fashion was due largely due to Phil Knight and Steve Bowerman of Oregon. In 1958, Phil Knight, a business major a the University of Oregon, and a miler on the track team, shared with his coach, Bill Bowerman, a dissatisfaction with the clumsiness of American running shoes.

They formed a company in 1964 to market a lighter and more comfortable shoe designed by Bowerman. In 1968, this company became NIKE, Inc. — named for the Greek goddess of Victory. At first, Knight and Bowerman sold their shoes in person, at track meets across the Western US. Their company thrived through a classic combination of entrepreneurship and innovation. Bowerman’s most memorable technical breakthrough was the optimal traction of the waffle soles he invented by shaping rubber in the waffle iron in his kitchen (1972). Other essential innovations were the wedged heel, the cushioned mid-sole, and nylon uppers.

Knight’s first great marketing ploy was announcing that “four of the top seven finishers” in the marathon at the 1972 Olympic Trials had worn Nike’s (the first three runners, in fact, had worn West German Adidas). Through the 80s and 90s, NIKE’s advertisements helped make it by far the foremost retailer of athletic shoes world-wide, thanks to the endorsements from superstars like Michael Jordan, and the catchy slogans like “Just Do It. ” After dozens of years, patents and commercials, NIKE and its competitors created an absolute mania for elaborate athletic shoes, in the US and aboard.

Though fashion remains a matter of taste, it is undeniable that both world-class athletes and even the average aerobics enthusiast owe a debt to the innovations of Phil knight and Bill Bowerman and to the industry they inspired. Phil Knight is the founder and CEO of the athletic gear company Nike. Knight and Nike helped start a sports business and revolution in the 1970’s changing old- fashioned tennis shoes into highly specialized equipment and promoting them as symbols of athletic prowess and success. Nike’s success made Knight one of the America’s wealthiest men.

In the 1990’s he was the subject of frequent protests over allegedly poor working conditions at Nike manufacturing plants in Asia. Phil Knight was born on February 24, 1938. He is as well married. His position in Nike is Chief Executive Officer, President and Chairman, Nike Inc. His educational background is Business Administration, University of Oregon (1959); M. B. A. , Stanford University (1962). His favorite personal sports are tennis, running, and golf. A co-founder of Nike and former University of Oregon miler with a personal best 4:10, Phil Knight received an MBA from Stanford University.

His master’s work provided the outline for the business that would become Nike, the world’s number-one sports fitness company. His theory? High-quality running shoes could be designed in the United States, manufactured in Asia, and then sold in America at lower prices than the then-popular West German-made running shoes. With a $500 investment matched by his co-founder and former coach Bill Bowerman, Knight began Blue Ribbon Sports (Nike progenitor) in 1964. Off to an uncertain start, he sold his shoes out of his back of a station wagon but continued to practice as a C.

P. A. and teach at Portland State, Univ. until 1969. The Cortez, the first shoe to appear under Nike brand, arrived on the athletic scene in 1972. Since then, Knight has inspired numerous innovations in the business of sports, including future-based ordering; substantial investment in long-term product research and development; national media reinforcement of performance and styling ties between product and athletes, and the creation of a customer- service program supported by a full-time technical team.

Nike’s Potential Growth: Knight wants to see Nike become a truly global sports and fitness company over the next 5 years. Global thinking, he stresses identities not only potential markets but types of sports and athletes that deserve Nike support. A personal statement stated by Knight is “it’s now my job to create an atmosphere of peace in the chaos of business- something I’ve learned from Asian business style. Phil Knight is currently the 13th richest man in the world. He is worth approximately 5. 8 billion dollars.

Phil’s 4th quarter dividend earnings for 1997 were 80 million dollars. Additional bonus given to Knight in 1995 was $787,500. The value of Nike stock owned by knight was $4. 5 billion in 1995. Some of Knights endorsements include Michael Jordan, Tiger Woods, and the Brazilian soccer phenom Renaldo. In 1992, The Sporting News has called him “The Most Powerful Man in Sports. ” Bill Bowerman is the co-founder of Nike as well. He was born February 9, 1911. He died on December 24, 1981 in his sleep of his Fossil, Oregon home on the third Saturday of Christmas Eve. He was 88 years old.

Bill was the person who more then anyone else started the nations jogging craze. He also was the inventor of the waffle sole for running shoes. In addition, his coaching tenure at the University of Oregon was highlighted by some of the most successful teams in the nation. He turned the college town of Eugene, Oregon into the running capital of the world, spread the gospel of jogging and fitness, and along the way, revolutionized the running shoe. During his coaching tenure from 1949 to 1972, Bowerman produced four national collegiate championship teams, plus two more that were runners up.

Individually, his interest, his athletes set 13 world and 22 American records. Among his 23 Olympic athletes was 1960 medallist Otis Davis, who won the 400 and ran the 4 x 400 relay. Besides Davis, his other top athletes reads like a Who’s Who in American distance–Dyrol Burleson, Jim Grelle, Bill Dellinger, Ken Moore, Wade Bell, and the late Steve Prefontaine (Hall of Fame member), Steve Savage and Keith Forman. A graduate of Oregon, Bowerman became active with the Nike Shoe Company after retiring from coaching.

He also coached 24 NCAA individual champions, 38 Pacific Coast Conference individual champions, 132 Northern Division individual champions, 4 NCAA team champions in 1962, 1964, 1965, and 1970, 33 Olympic team competitors, 64 All-Americans, and coached the 1972 Olympic track and field team. In 16 of his 24 years, his Oregon track team finished in the top 10 in NCAA championships. He owns 13 consecutive Northern division team championships. His dual-meet record at the U of O was 114-20, a winning percentage of . 843.

He served at the helm of the NCAA track and field coaches association and NCAA track and field rules committee, and was a professor emeritus at the U of O. Bowerman not only coached the athletes, but also was a tireless worker and innovator for the sport of track and field. He was instrumental in developing rubberized asphalt runaways, developed statewide programs for high school athletes, and a instituted jogging programs throughout Oregon that led to the nationwide jogging craze. Though his innovation and drive made him wealthy, Bowerman gave as much or more back to the community.

His matching-grant programs have contributed to Oregon’s education, arts, medical research and the environment. He’s given money to Gilchrist, Mapleton and Medford to pay for all-weather tracks and, when budget cuts threatened the Oregon baseball program, Bowerman dug into his own wallet to support the formation of a club baseball program. In 1990, he agreed to donate 2. 1 million dollars for the construction of a two-story building at the legendary Hayward Field on the UO campus that now bears his name. He also created the Bill Bowerman Foundation, which supports grass roots track-and-field programs throughout the country.

Steve Bowerman had given frequently to organizations like the Oregon Bach Festival, Eugene Arts Foundation, Eugene Symphony, Eugene Opera, and the UO Museum of Natural History, and always to little fanfare. Nike’s mission for corporate responsibility is “to lead in corporate citizenship through programs that reflect caring for the world family of Nike, our teammates, our customers, and those who provide services to Nike. ” Nike has more than 500 contract factories around the world in about 45 countries. In May of 1998, Nike set out 6 new corporate responsibility goals for these factories.

Nike has raised its minimum age limits from the International Labor Organization standards (15 in most countries and 14 in developing countries) to 18 in all footwear manufacturing and 16 in all other types of manufacturing (apparel, accessories, and equipment. ) Footwear factory managers, including C. T. Park, pledged not to hire anyone under the age of 18. In Vietnam, that is the minimum age anyways, so the factory did not have to alter hiring practices. (According to the labor law, Vietnamese under that age are allowed to work with parental permission. Not at Nike Factories though. )

Big retail and apparel companies are in a global race to increase profits by driving down costs. As they source merchandise from all over the world, they search for places where workers are paid the lowest wages, and human rights are trampled. There are no international laws that require corporations to respect workers’ rights, to ensure decent working conditions, or even to pay a living wage. In fact, the current trade laws encourage companies to make their products in places with the worst conditions and the lowest wages — and places where workers are not free to stand up for their rights and protect themselves.

Companies are driving us all into a race to the bottom. Factories with good conditions are getting shut down. That means decent factories in the U. S. and Canada – as well as decent factories overseas. And sweatshops are opening up – in New York, Toronto, and L. A. – as well as in Honduras, Indonesia, and China. In a factory in Guatemala, hundreds of young women worked around the clock earning pennies making Van Heusen men’s dress shirts. To get better wages and working conditions they fought for ten years to win a union.

After they won, the Van Heusen shirt company closed their factory and moved the work to lower-wage sweatshops nearby. “We organized a union because we wanted to work less than 60 hours a week and have time for our kids,” said Claudia Rodriguez*. “Now we’re making the same shirts, but we’re back to working long hours in sweatshops because they closed our union factory. ” This is a sweatshop. In a Manhattan sewing shop, young immigrants work up to seven days a week, from early in the morning until late at night.

The owner punches their time cards after eight hours, but they keep working even though they are never paid overtime. This is a sweatshop. Some of the garments they make were sold at big name stores such as Lord & Taylor. In a factory in the Dominican Republic, workers earn eight cents for every $20 baseball cap they make. Hundreds of workers have been fired for going to school at night. Hundreds more were fired for trying to organize a union. This is a sweatshop. They make caps for Nike and Champion with the logos of major universities in the U. S. nd Canada – such as Notre Dame and University of Michigan. In a Kentucky uniform factory, the pay is so low that many full-time workers qualify for food stamps and other public assistance. There are no health benefits, so many workers must choose between buying food and taking their kids to the doctor. Lisa Jones quit because of sexual harassment at the factory. In a quote by Lisa Jones “I started thinking, how am I going to raise my little girl to have self-respect if I don’t have it,” she said. This is a sweatshop. They make uniforms that many cities purchase with tax dollars.

The major retail chains and big name apparel companies call the shots in the clothing industry. By constantly driving down the price they will pay for goods, they force sweatshop conditions on sewing factories. That means higher profits for the retail and apparel giants, not lower prices for consumers. Five department stores chains account for nearly two-thirds of all department store sales in the U. S. Those retail chains have tremendous power over the companies that make the clothing the stores sell. Most of the garment factories, here and around the world, couldn’t stay in business if they lost the business of the retail giants.

That’s why the big retailers could stop sweatshops if they wanted to, or if they had to. When these retailers demand quality merchandise and on-time delivery, they get them. If they also demanded that every garment had to be made under decent conditions, there is no question that things would improve fast. In the fall of 1999, an Indonesian human rights organization interviewed 3,500 workers in Nike contractor factories in Indonesia about their pay and working conditions. The survey, conducted by Indonesia’s Urban Community Mission in conjunction with U. S. based Press for Change, was the most comprehensive investigation of working conditions in Nike’s Indonesian plants in three years. Here are some of their findings: Cruel Treatment: 57 percent of Nike athletic shoe workers and 59 percent of Nike clothing workers reported that they had seen workers being shouted at or subjected to cruel treatment by their supervisors. Examples of abuse that workers cited included wage deductions, having their ears pulled, being pinched or slapped, being forced to run around the factory or having to stand for hours in factory yards (known as “being dried in the sun”).

As punishment on the job, workers were made to clean the toilets. Reported verbal abuse included the Indonesian equivalent of phrases like “You Dog,” and other vulgar words like this one that should not be repeated. Forced Overtime: Workers’ most common complaint was being forced to work excessive overtime – more than 72 hours per week during peak periods. Nike’s code of conduct calls for working hours to be limited to 60 hours. Poverty Wages for Shoe Workers: The second most serious complaint cited by footwear workers was low wages.

The vast majority of Nike shoe workers interviewed told surveyors their basic wages at the time of the survey were between $33 U. S. (Rp 251,000) and $39 U. S. (Rp 300,000) per month – which comes to about 16 – 19 cents an hour. This wage does not even come close to covering the costs of a family’s basic human needs. Since these interviews, the cost of living has continued to deteriorate, and Nike contractors’ increases in the nominal wage have not been adequate to account for inflation and currency devaluation. Even Lower Wages for Apparel Workers.

Nike apparel workers in Indonesia earn even less than Nike footwear workers. The survey found that 31 percent of the 1,200 Nike apparel workers interviewed earned less than the equivalent of $33 U. S. dollars per month (Rp 250,000). That is 25% percent less than what even Nike says that it takes to meet one person’s minimum physical needs, without taking into consideration providing for family members or savings. According to surveyors: “Workers struggling to survive on wages this low are in a desperate position. ”

Shoe giant Nike has suspended a manager in its Ho Chi Minh City factory in response to a labor group’s charge of worker abuse in Vietnamese manufacturing plants. A U. S. -based company spokesman told USA Today that a manager had been suspended for abusing workers. The paper reported that labor activist Thuyen Nguyen of U. S. -based Vietnam Labor Watch inspected Nike facilities in Vietnam last month in escorted and surprise visits. Nguyen said he found violations of minimum wage and overtime laws as well as physical mistreatment of workers.

His 12-page report on working conditions in Vietnam is the latest in a series of troubles Nike has faced with its subcontractors in Vietnam. Last year, a South Korean factory floor manager working for Nike subcontractor Sam Yang Co. was convicted of beating Vietnamese employees with a shoe. At least 250 Vietnamese employees walked off the job at the Sam Yang factory last week to protest poor working conditions and low wages, state-run media reported. ”Workers at the factory work in overheated and a noisy environment,” the official Laborer newspaper reported. ‘The requirements from the health care department for labor conditions have not been met. ” A second Nike subcontractor, Taiwanese firm Pou Chen Vietnam Enterprise, has been cited for physically abusing workers at its plant. Among other things, a floor manager at the Pou Chen plant forced 56 women employees to run laps as punishment for wearing non-regulation shoes. Vietnamese press at the time of the incident said 12 of them fainted and were taken to a hospital. That incident occurred on March 8, International Women’s Day. The manager accused of making women run laps has been suspended, Nike spokesman McLain Ramsey told USA Today.

Nike has repeatedly come under criticism for not clamping down on poor labor conditions in factories it hires to produce its line of footwear and apparel. ”While Nike claims it is trying to monitor and enforce its code of conduct, its current approach to monitoring and enforcement is simply not working,” the paper quoted Nguyen as saying. Ramsey confirmed Nguyen’s visit to the Ho Chi Minh City plant and also told the paper that Nike officials are ”as distressed as he is” about the report. ”Nike has a full investigation going and encouraged local police to do the same,” he told the paper.

In the Vietnamese capital, Hanoi, a senior labor official reiterated complaints that workers in Nike-contracted factories faced inhumane treatment. ”Violations of labor rights generally are occurring in their smaller contractor joint venture or wholly-owned ventures in which the Vietnamese side has minimal control,” said Tu Le, a senior official from the Vietnam Labor Union. Nguyen’s report was to be released today in New York. Just weeks ahead of the report, Nike announced it had hired former U. N. Ambassador Andrew Young and his Goodworks International group to review a new code of conduct for the company’s overseas factories.

The measure was aimed at quelling mounting criticism that working conditions at factories in Indonesia and Vietnam were substandard. Nike uses five manufacturing plants in Vietnam, where it takes advantage of low-cost labor and relatively high production standards. About 3 percent of Nike’s output is produced in Vietnam, a Nike spokesman said in an earlier interview. Michael Jordan became the first athletic mega businessman. His role as a spokesman for Nike turned that athletic-shoe and- apparel company into the world leader, earning both him and Nike millions of dollars. marketing

Intel Corp Leadership Study

1. Andy Grove and his role in Intels Success When I think of Intel, I think of Andrew Grove. That may be due to my age, and the fact that I was too young in 1968 to know that Gordon Moore and Robert Noyce, pioneers in the semiconductor industry, had left Fairchild Semiconductor to form Intel Corporation. But I believe that my association of Grove with Intel is due more to the tremendous influence that he has had on the company as the official and unofficial overseer of Intels internal operations from the beginning.

Even though he did not join Intels executive committee until 1976, and did not become CEO until 1987, it is clear that he has been the leader at Intel since the beginning. He has constantly pushed the collective company envelope with big, hairy, audacious goals to produce better and faster chips that ultimately have been some of the primary drivers of the computer industry. Intels first goal was to replace magnetic-core computer memories with semiconductor memories. Their objective and early vision, initially shaped by Gordon Moore, was to dominate any market in which they participated.

They would set out to accomplish this internally by buying options, which allowed them to systematically explore various alternatives. This approach gave them flexibility but also created internal competition, which played a strong role in shaping the culture of Intel. I believe that Moore, who felt that the semiconductor business lived on the brink of disaster, also was a very strong influence on Grove. Grove seemed to carry on Moores Law that approximately every three years a new generation of chips must be developed with four times the capacity of their predecessors.

The companys first SRAM chip, the 1101, came out in 1969, but Intel was constantly driven to change the industry. Moore, Noyce and Grove were never satisfied long. They initiated a drive within the company to produce a DRAM chip with four times the capacity of the SRAM. The resulting 1K chip, introduced in 1971, was the 1103, which was universally preferred to magnetic core technology and became the industry standard. After two other big developments in 1971, Operation Crush an all-out combat plan was initiated to make the next generation 8086 chip the industry standard.

This was followed by development of the 432 project. The 8086 and 432 are examples of buying options Intels strategy whereby one product is developed with an evolutionary strategy while another is developed with a revolutionary strategy. Noyce remarked that through these R&D projects, often times Intel may not have found what they were looking for, but found something else equally important. Andy Grove could be described as a detail-oriented pragmatist, as oppossed to Gordon Moore, who was a technology driven futurist. Grove was a demanding, hard worker who worried about how to accomplish what Moore dreamed up.

This has been a critical element in Intels success. Grove noted that it led to the development of the Two-in-a-Box management philosophy. This consisted of two individuals with complimentary skillsets, much like Grove and Moore, sharing the same management position in order to stabilize a transition, start-up or reorganization. It was also used to groom successors or to get more value out of a position. Some people in the organization viewed this as inefficient, but Intel continued to succeed. According to another executive, Grove possesses aggressive brilliance.

Hes very articulate, yet with a powerful, confrontational style. I believe Groves penchant for constructive confrontation led Intel employees to think of themselves as the Marine Corps of the industry. He helped develop an organization with bright, opinionated, macho, rude, even arrogant and impatient, and very informal employees. This negative type of personality meant that Intel people often didnt care how they got results, but it probably gave them the toughness to weather the 1980s recession and the semiconductor price wars of 1986-87 that caused U. S. manufactures to lose billions.

Intel survived, not unscathed, probably in large part due to Grove. Despite his tough style, he focused on individuals and took a lot of pride in putting people where they were needed. This would be extremely important as he tore the company down and put it back together a number of times, as was done in 1986, when Intel exited both the DRAM and SRAM businesses. The open culture he helped create enabled him to move people up, down and sideways during reorganizations and allowed him to implement his 125% and 90% solutions to get more out of his people in tough times.

Grove believed that in their business there are the quick and there are the dead. He helped the company accept as the norm constant relearning, as the company changed its focus. This would be the case as he moved the company into microprocessors, as they were faced with protecting Intels intellectual property, and as they had to make the CISC vs. RISC choice in the late 1980s. He would push for more rapid product introduction and force computer makers to keep up with the pace set by Intel. He pushed for dvelopement of The Intel Inside slogan.

The process at Intel seems to closely follow the exhibit The Process of Renewing and Transforming Organizations (Kotter) that we studied as part of the Charlotte Beers case. Even though Grove believed that work time and leisure time should be separate, he did begin to soften that stance to combat burnout. He moved for a more friendly work environment and even offered sabbaticals for employees with enough service. As the 1990s began and Andy Grove oversaw a company that was significantly molded in his personality, his vision had changed only slightly:

We are currently a leader in semiconductors, and my hope and vision is that our technology is going to be the heart and spine of the entire computer industry. 2. The Culture of Intel and its Creation Intel started as a purely functional organization centered on R&D and getting done what needed to be done to crank out new and better chips. Andy Grove and Gordon Moore wanted an unconventional approach initially. They wanted to reduce barriers and promote a free flow of ideas and information throughout Intel. A physical example of this was the cubicles of one big hall that all employees, including executives, sat in.

Walls were low and executives were not clustered in one area, but spread out. Meeting rooms and parking spaces were on a first-come, first-served basis. Dress was casual. These were classic examples of role modeling by Intel executives that played a major role in shaping culture. It probably gave all employees the confidence to speak up in meetings where even high level executives were present, which they were encouraged to do. But as early as 1976 the first divisions were established in order to focus managers attention on emerging business segments.

Functional and business lines began to cross in matrix-relations. Task forces, councils and other cross-boundary devices were set up along with other more informal relationships in order to bring ideas to fruition. These new ideas often originated from small, highly motivated, and innovative teams and then were carried by product champions through the gauntlet of Intels corporate hierarchy towards approval and/or rejection. This helped create a company with a very sharp and well-defined sense of history and identity.

Great examples of secondary embedded mechanisms at Intel are the stories that evolved about how these product champions transformed dreams into amazing products. As the stories were retold over and over, the developers and champions became legendary and through the years became part of company mythology. Further evidence that the company culture was adding some more formal components ,though, could be seen in the creation of a formal Strategic Long Range Planning (SLRP) process, which Gordon Moore pushed for, and required middle managers to prepare formal strategies for their business segments.

The way we do things around here was embodied in what Gordon Moore believed: One of our unspoken rules at Intel is that if you cant measure something you dont understand it. Not surprisingly, Moore was in charge of many of the primary embedded cultural mechanisms at Intel; measurable things like profitability and other targets that helped determine employee bonuses. He was a strong believer in performance based incentives, unlike Grove who focused more on individuals.

Intel did try to remain unbureaucratic, but it was felt by one executive that in the companys zest to do that, it was undertaking too many reorganizations. This in turn led to unnecessary attrition and erosion of their knowledge base. The human side seemed to get lost in the mechanics of drawing up a new organization chart. Those that did remain thought of themselves as a special breed: Intel was not a place for those looking for a stable environment. Part of the socialization process seemed to come from this lack of stability.

The constant action led to many internal meetings, during which employees were encouraged to debate the pros and cons of issues. This led to a sort of trial by fire, but taught people to stand their ground. A survey was conducted in 1988 on employees understanding of Intels culture. The senior officers hoped to get a handle on the human relations side of things in order to try to balance the entrepreneurial spirit of the company, which often led to instability, with the people side of things. There was a faction of long-time managers who didnt seem concerned about that though.

They felt that things had worked fine so far so why change. This survey did lead to a formalized document clarifying Intels values. I believe that the espoused values contained in the document very closely match the actual values of the company. Of the six categories risk taking, quality, discipline, customer orientation, results orientation, and a great place to work only the last one really reflects a major concern for people, and Intel was not first and foremost about people. What Grove was all about is contained in these values.

Intels culture has been partly defined by the fact that they have so often in their history been at a strategic crossroads, but have been able to transform themselves through constant strategic renewal and revitalization. This culture will continue to exist, as long as Intel pushes to stay out in front. The October 16, 2000 Chicago Tribune points out that Intel wont have the Pentium 4 ready for a planned pre-Halloween launch, which will cost them holiday sales in the consumer channel. They better keep pushing.

Zorlu Holding And Vestel Electronics

Group’s subsequent growth: integrity, perseverance and unconditional commitment to quality. Integrity is the Group’s cornerstone value and they expect it to govern every aspect of their business. Hard work and perseverance are essential for the day-to-day success of their enterprises as they are for the undertaking) of a new venture. Quality is the key to customer loyalty, on which the long-term prosperity a f all ventures depends.

With these ground rules, the Zorlu Group has sought to develop solid and profitable businesses that contribute to the welfare of the Group; its customers, usiness partners and employees; as well as the larger community. Until the early 1990s, they focused their investments in home textiles, an activity the Zorlu family has been involved with for several generations and in which they have a particular expertise. In 1994, they saw the opportunity to employ their strong capital and human resources in the consumer electronics sector, through the acquisition of the Vestel electronics Group.

This was followed, in 1996 and 1997, by investments in the fast- growing energy and financial services sectors. Between 1990 and 1997, they tripled the umber of their operations, increasing their total assets to just under US$ 1 billion, excluding the assets of five of their six subsidiaries incorporated abroad. They invested in state-of the-art spinning, weaving and textile technology that has made them the worlds largest; vertically-integrated polyester curtain producer and will propel them to the forefront of the international home textile industry in the years to come.

They acquired the Vestel Group of consumer electronics companies, pushed its balance sheet from an undeserved red into the black, and set it on course to become leading contender in the international consumer electronics markets. They established a bank, a leasing company and o factoring firm and they penetrated the power generation and electricity distribution sectors with the construction of two plants and a; competitive bid for o state- owned, plant slated for privatization.

The Zorlu Group’s rapid growth since 1990 reflects the vast range of opportunities that have emerged from the unique juncture of Turkey’s Customs Union with the European Today, their operations include 32 companies in Turkey, France, Germany, Holland and South Africa in the textile, consumer lectronics, finance, energy and tourism sectors. In 1997, their key operations achieved net sales of almost US$ 750 million and after tax profits of just under US$ 80 million.

That the Zorlu Group was able to choose its projects well and bring these to successful fruition during a period of significant economic and political uncertainty is a reflection of their strategic corporate vision, their sound business principles and their strong management capability. Mehmet Zorlu, a textile manufacturer with a vision of Turkeys textile potential long before their country had made ts mark on international markets, founded the Zorlu Group of companies in the early l950s.

At an early date, Mehmet Zorlu endowed the Group with o rare combination of values honesty, dedication to quality, commitment to long-term goals and the courage to take calculated risks that reward hard work. Today; these values are the foundation o f their corporate culture and constitute the basis for their key business principles unconditional customer satisfaction and mutually beneficial partnerships. The Zorlu Group is committed to constantly improving the quality and enhancing the range of its products and services.

That is why they have sought to expand their product range in the consumer goods categories where they are active and to ensure, through ceaseless research and development, that their products best reflect the demands of their consumers and the latest technological developments. Likewise, they are committed to developing strong and long-term relationships with their customers, their employees, their suppliers and their shareholders.

Their aim is to provide their customers with high quality products and services, to exact specifications and on competitive terms, and they expect heir suppliers to do the same for us. They also expect their human resources to be the very best in their areas of expertise, so they have set an unlimited budget for training to help them achieve this performance. First-class human resources are essential if they are to achieve the strong financial results that their shareholders deserve and which their recent performance confirms they can attain.

They are proud of their achievements over the last decade, but they are not prepared to rest with these. (Zorlu Holding Company Profile) The Goal Of The Zorlu Group To strengthen their global reach, from he Far East to the American continents, through strategic and long-term partnerships, care fully planned investments at home and abroad and focused research and development. The Zorlu Group is always open to exploring strategic partnerships that will expand their international markets, enhance their product range and contribute to their technological know-how.

Currently, they are considering several long-term partnerships in consumer electronics for research and development, technology transfer, customized production and manufacturing facility sharing in international markets. The Zorlu Group’s investment strategy To reinforce its capacity, technological lead and vertical integration in its primary areas of activity while creating new capacity in selected high-growth sectors.

In the textile sector, they hove invested more than US$ 500 million in several projects that will more than triple their polyester yarn capacity and double their curtain fabric output, These include a vertically-integrated, cotton-based home textile plant that is the world’s third largest in terms of capacity and unparalleled in its cutting-edge technology. In South Africa, they initiated construction f a manufacturing facility that will come on stream in 1998 and supply the fast-growing demand for curtain fabric in the region.

In France, they acquired majority shareholding of Bel-Air Industries, one of the largest home textile producers in Europe. Bel-Air has three manufacturing facilities, a wide range of internationally renowned brands and a distribution network of 5,000 dealerships in France and Germany. In the consumer electronics sector, they have expanded their television production capacity four-fold since 1995 and more than doubled their capacity for television components uners, remote controls and satellite receivers. At ‘ the same time, they have incorporated new technologies that have enabled them to launch innovative products; such as. ide-screen televisions and information appliances, They have also initiated construction of a new manufacturing plant that will produce static and no-frost refrigerators under Sanyo license in-early 1999. While deepening their traditional lines of business, the Zorlu Group has expanded into new areas of activity where they believe they have a competitive advantage. Their decisive entry into the financial sector reflects their conviction that they have the human esources; the international standing and the capital strength to become one of the top five mid-sized financial groups in Turkey.

Their US$ 150 million investment in power generation, motivated by the Group’s large demand for high quality and economical energy, has prepared them to compete for Turkey’s large-scale energy privatization projects. “The Zorlu Group is not afraid to grow because they believe they choose their projects prudently, but they also recognize that growth must be managed. That is why they are investing in their human resources, reinforcing their management capability with integrated usiness software and drawing heavily on external consultancy. ” They are not embarrassed to learn from others how to strengthen their business.

Nor do they shy away from licensed technology. On the contrary, they prefer to learn as much as they can from others because they can then focus on what they do best; making better products, providing higher quality services and improving the return for their shareholders. Turkey is a country, which has an incredible opportunity, though its potential has recently been clouded by economic and political instability and one of the highest inflation rates worldwide. Having confirmed what they can achieve in this difficult environment, they are confident in the Zorlu Group’s future and look forward to sharing this with the customer. http://www. zorlu. com. tr) CONSUMER ELECTRONICS DIVISION The VESTEL Group In 1994, the Zorlu Group became a leading contender in the consumer electronics market when it acquired, Vestel Electronics. Founded in 1984, the Vestel Group comprises four manufacturing and six marketing and distribution companies in the consumer electronics, white goods and information technology sectors. The Group’s products include olor televisions, personal computer monitors, set-top- box satellite receivers, personal computers, television tuners, remote control units, remote control converter kits and Internet boxes.

In 1999, the Group will initiate production of no-frost and static refrigerators. The Vestel Group has been at the forefront of Turkey’s consumer electronics sector since I 984, when it established Vestel Electronics, currently one of Europe’s leading color television producers specialized in OEM. In the following years, the Group expanded vertically into television components, and horizontally into information technology and white goods. Vestelkom, the Group’s components producer, is Europe’s fourth largest manufacturer of television tuners.

In 1987, Vestel established one of Turkey’s first computer assembly operations and subsequently initiated the design and production of monochrome and color PC monitors for export. Vestel’s history in the white goods sector dates back to I 988, when the Vestel Group established a joint venture with a leading Asian durable goods manufacturer to produce microwave ovens, later expanding into production and marketing agreements for refrigerators, washing machines, dishwashers and mini electric ovens.

After nearly a decade of rapid growth, the Vestel Group suffered a brief period of decline under- its previous owner in the early I 990s. This situation was rapidly and decisively reversed by the Zorlu Group, which brought to the Vestel Group new capital resources, an experienced, and entrepreneurial management team and a new focus on quality and customer satisfaction. Between 1995 and 1997, Zorlu Group invested more than US$ 40 million in expanding and modemising the Vestel Group’s capacity and in business reorganization.

Over the same period, the Vestel Group raised its consolidated net sales and exports by espectively 148% and 190% in US$ terms and its after-tax earnings by more than 500%. The Vestel Group’s rapid recovery reflects its majority shareholder’s commitment to unconditional customer satisfaction through new and improved products, greater product features and accessible prices. It also reflects the far-sighted manufacturing strategies of its management team. (http://www. vestel. com. tr) Vestel’s manufacturing strategy “Quality, innovation, and quick response. To support this, the Group is continually investing in new technologies, new capacity and greater production flexibility. At the same time, it has pursued vertical and horizontal integration to enhance its control over the final quality of its products and to optimize scales of production. This strategy has enabled Vestel to secure its position as a first-class original equipment manufacturer. Vestel has the production flexibility to meet a wide range of specialized needs and the strict quality controls to ensure consistently high quality products.

Because it is continually investing in new technologies, Vestel is able to launch new products and product features that reflect the very latest trends in the international arkets. The Vestel Group’s technological park includes state-of the-art surface mounting and plastic injection machinery, nitrogen-environment automatic soldering machines, quick proto-type machinery and automatic micro-controller software. This advanced technological base is buttressed by the Group’s engineering expertise and in particular, the technical know-how of its research and development teams.

Vestel’s research and design team was the first in Turkey to develop its own television design and the only one to develop micro- controller software for application in its production processes. Currently, it is focusing its efforts on flat panel (plasma display) televisions, line flicker and noise reduction, Dolby sound systems, digital interactive television units, digital video disk players, digital video disk broadcasting decoders, multimedia monitors, video conferencing and chip design.

Vestel Electronics The Zorlu Group’s principal operation in the electronics sector is Vestel Electronics, one of Europe’s leading manufacturers of color televisions. In 1997, Vestel Electronics produced 2,200,000 color televisions and supplied respectively 7. 5 % and 32% of the European and Turkish color television markets. In 1998, the company is increasing its capacity to 4,000,000 units. Vestel Electronics ‘is also the largest producer of personal computer monitors in Turkey, with an annual capacity of 1,000,000 units, and the only manufacturer of desktop personal computers with ISO 9002 certification. Zorlu Holding Company Profile) Vestel Electronics’ goal Become one of the world’s top three consumer electronics companies. Vestel Electronics is a publicly traded company with 33% of its shares traded on . the Istanbul Stock Exchange; The Zorlu Group owns the remaining 67% shareholding. In 1997, Vestel Electronics anked among Turkey’s top 10 private enterprises with a turnover of US$ 516 million. Since its establishment in 1984, Vestel Electronics has pioneered the development of the Turkish electronics sector with innovative and high quality products and internationally competitive prices.

After its acquisition by the Zorlu Group, Vestel Electronics embarked on a new period of growth, raising its color television capacity from 400,000 units in 1994 to 2,200,000 units in I 997 and 4,000,000 units in 1998. This rapid expansion has enabled the company to incorporate the latest technological developments in its production processes and to reorganize ts productive capacity to best meet the demands of its international clients. Vestel Electronics’ I 00,000 m2 television plant is located in the Organized Industrial Zone of Manisa, 30 kilometers from the Aegean port of Izmir.

The plant employs over 3,000 people and encompasses, all phases of the television production process: research and development; production of printed circuit boards (PCBs), chassis and cabinets; testing and mounting of the final product; production of packaging material and after-sales services. Vestel Electronics sources its chip tuners and remote control nits from Vestelkom, another Vestel Electronics Group company. (http://www. vestel. com. tr) Vestel Electronics’ production lines incorporate state-of-the-art surface mounting assembly technology and fully automated testing processes.

Advanced production technology, strict production process controls and a high degree of vertical integration ensure that Vestel’s television sets are of consistently high quality that meet or exceed international standards. Vestel Electronics has a first-class manufacturer’s return rate. Vestel Electronics’ excellent product quality is complemented by an exceptionally high degree of production flexibility. Vertical integration, a strong research and development base and in-house engineering expertise enable Vestel Electronics to produce both small and large batches of customized television sets in record time.

Utilizing pro-engineer CAD/CAM software and prototype machinery, the company can produce full-size models in three to four days and initiate full production in less than one month. Vestel Electronics’ research and development team is preparing to take the lead internationally through licensing agreements with some of the world’s foremost engineering firms and strategic collaboration ith several of Turkey’s top technical universities. These partnerships have reinforced the company’s traditional leadership in Turkey and set the stage for new product launches on an international scale.

Vestel Electronics was the first producer in Turkey to produce 100 Hz televisions and the only producer of 16:9 inch, 33-inch, Dolby Surround PrologicTM and digital televisions as of end-1998. In 1998, the company is launching Turkey’s first Internet set-top-box television, Internet. TV. All of these have been designed to meet the technical specifications of Vestel’s key export arkets in Europe, Asia, North and South America and Africa, CIS and Australia.

Other areas where Vestel Electronics is focusing its research and development efforts are flat panel plasma display) televisions, line flicker and noise reduction, Dolby sound systems, digital interactive television units, digital video disk players, digital video, disk broadcasting decoders, multimedia monitors, video conferencing and chip design. Vestel Electronics has established an in-house EMC laboratory for CE testing and its research and development team works, closely with authorized certification laboratories to assure that new products meet r exceed. ll required international standards. All of the company’s televisions are produced to BEAB, BS, CE, UL, FTZ, LCIE, TÜV and VDE standards as well as to the individual standards of its export markets. Vestel Electronics has been operating with ISO 9001 certification since 1993. (Zorlu Holding Company Profile) Vestelkom Vestelkom is a contract manufacturer for the telecommunications industry and Turkey’s leading producer of television tuners, satellite receivers, remote control receiver/transmitter units.

Since early 1998, it is also the only producer of Internet set-top-boxes in Turkey. Vestelkom’s new 20,000 m² plant in the Aegean Free Trade Zone near Izmir has the largest component surface mount assembly operation in Turkey, Moreover Vestelkom’s 2,400,000 surface mount device (SMD) chip tuner capacity, as of-end-1997, positioned the company squarely among the top four television tuner producers in Europe. Vestelkom’s leadership in the tuner segment reflects its long experience in the consumer electronics sector and in-house engineering expertise.

Founded in 1975 Vestelkom was Turkey’s first consumer electronics company to produce tuners and remote control unitsfor both onochrome and color televisions and to introduce surface mounting of components. In 1989, Vestelkom began to produce television tuners under Temic license, exporting 100% of its output to his company. Today, Vestelkom continues to export all of its tuners and is forcefully expanding its exports of satellite receivers and remote control units, the latter to countries in the Middle East and Africa where large numbers of television sets are still manually controlled.

To respond to the growing demand for its products, Vestelkom is rapidly expanding both its production capacity and its product range. Vestelkom’s production lines utilize state-of-the-art Fuji and TDK assembly machinery and the latest generation of testing and alignment equipment. Manual and automatic testing is complemented by statistical process controls to ensure that every one of Vestelkom’s chip tuners are produced in line with FTZ and CCIR standards. The company expects to reconfirm its high standards of quality with ISO9002.

As with Vestel Electronics, Vestelkom has developed its own in-house research and development capacity. The company is currently designing satellite receivers, with two analogue receivers under production and one in the development stage. Vestelkom is also on the design for a new remote control transmitter unit with chip-on-board. In the longer run, Vestelkom aims to develop and manufacture products for radio frequency and digital telecommunications. Vestel White Goods was established in 1997 following the group’s successful launch, in 1996, of the VESTEL WHITE brand to the Turkish market.

Vestel White Goods is the Group’s first manufacturing investment in the white goods sector since the Zorlu Group acquired the Vestel Group in 1994. Vestel White Goods is constructing a US$ 100 million static and no-frost refrigerator plant that will have an initial apacity of 600,000 units in early 1999 and a final capacity of 1,200,000 units on its completion at-end-2000 Sanyo of Japan is providing the technical know-how for the plant, which has been designed with a flexible production structure to facilitate customized production.

This flexibility, combined with state-of- the-art technology, will enable the plant to export roughly half of its output to Europe, the CIS, North Africa and the US. Vestel Goods plant is located in the Manisa Organized Industrial Zone Near Izmir. In line with its strategy of developing capacity in the white goods sector, Vestel White Goods is initiating two ore manufacturing investments in mid 1998. The first of these is a US$ 80 million facility for producing fully-automatic washing, machines that will have a capacity of 1,000,000 units when it begins operation in the second half of 1999.

The second is a US$ 30 million split air conditioner plant that will have a capacity of 250,000units when completed in early 1999. (Zorlu Holding Company Profile) Vestel Information Technology Vestel Information Technologies provides information technologies services in Turkey as a member of Vestel Group Companies within Zorlu Holding since 1987. It provides information technologies ervices worldwide by establishing Vestel-USA; the first global company ever established by Turkish capital in Silicon Valley, California, USA.

North and South American operations are managed from the Silicon Valley, European, Middle Eastern and African operations are managed from Turkey and Asia-Pacific operations are managed from Taiwan. Vestel does not only follow the produced, ready made technologies. Three R&D centers were established by the company, one of which is in Silicon Valley where the technology develops rapidly in USA, second one in Taiwan and the other one in Manisa, Turkey. Vestel R&D departments play an active role in electronics and computer technologies with its new technologies and methods.

Today, the opportunity to develop technologies completely cooperation with the leading companies in the field. Therefore, Vestel was established cooperation with giant corporations such as Microsoft, Sun Microsystems, En Reach Technology, SPYGLASS and Integrated Systems in Software field and with Intel, Teralogic, Information Graphics Systems Inc. , Cyrix, GEMPLUS in hardware field and the company continues to conduct can only be possible by establishing strategic cooperation with the leading ompanies in the field. http://www. vestel. com. tr) Vestel Information Technologies have renewed its internal organization to reflect the technological excellence arose from this giant organization and synergy generated from the local information technologies and four giant group companies providing Internet services directly to the customer satisfaction. The new organization consists of two operational groups, one of which is Individual Systems and the other is Corporate Systems.

Vestel Information Technologies is proud to provide services to Turkish citizens as the Turkish Division of his giant organization with its information devices equipped with new technological excellence, product ranges, channel structure formed of distributors, dealership structure and widespread sales points, 40 effective service networks in 24 provinces, specialized partners, unique field knowledge and Promega product range designed for corporate market.

Vestel Information that is in the information sector since 1987 is now provides services in personal computers market by the launch of Vestel Asteo PCs in1996 and corporate systems market by the launch of PROMEGA product range. The company nsured the “plant production” concept to be used in computer production field with the product quality provided by the input, production, post-production quality control, heat, electrical and mechanical tests and advanced production technologies. The company achieved to meet the world standards in the production of every single computer and enhanced the quality standards by the special tests conducted.

The new computer plant established in Izmir will start its operations on June, 1999 and the investments will be continued to provide production of world class PCs. Vestel started to produce monitors in 1988 ith the production of monitors to IBM. The company started to produce Vestel design monitors as of March 1998. It reached to a capacity of 250K monthly on 5 assembly bands at its plant in Manisa on May, 1999 and it aims to posses a local market share of 80%. Annual target of the company including the exportation is 3 millions.

Vestel electronics Monitor Plant is the new indicator of Vestels investments in IT field and its identification of being technology producer not consumer. VestelNet VestelNet was established in 1997. · Primary vision of Vestel Net Growing at a high rate in coming years. · Mission of Vestelnet Serving this Network Society and create value for the investors by satisfying the needs of the Network Society. To this end, VestelNet is investing in state-of-the-art ISDN technology to create one of Turkey’s strongest digital Telecommunication backbones.

The backbone comprises a private, frame relay wide-area network, using SDH equipment, with bandwidths up to 622 Mb per second. This type of bandwidth will enable rapid and secure transmission of data as well as high quality video and audio conferencing. VestelNet has also donated a building to the national communication company, Türk Telekom, for a new switching office. Located near VestelNet’s main systems center, the switching office will ensure that Türk Telekom can handle VestelNet’s large volume data flow.

Another objective of Vestelnet’s advanced telecommunications infrastructure is to facilitate the rapid and reliable transmission of information between all the Zorlu Group companies and external information providers. Concurrently with this objective, VestelNet is assisting individual Group companies strengthen their links with key customer accounts. Here, VestelNet is developing a technology platform that will allow Denizbank, the Zorlu Group’s bank, to offer Internet-based anking services. A similar project will link Vestel Marketing on-line to its nation-wide network of brown and white goods dialers.

In addition to developing and managing the Zorlu Group’s wide-area network, VestelNet plans to open its telecommunication backbone to large corporate clients that require efficient, fast and secure data transmission services and to provide Internet services to the general public. VestelNet has tree platforms for accessing the Internet TTNet, satellite link of the Dexar Comm. Multimedia, Global satellite links Turnet, the national fiber optic network, and direct satellite links. VestelNet has the capacity to handling over 100,000 customers, 88 MBit of Internet access bandwidth and over 10,000 access ports. http://www. vestel. com. tr) Vestel Durable Goods Marketing Vestel Durable Goods Marketing sells and distributes the goods throughout Turkey either manufactured or imported by Vestel Group of Companies. Founded in 1986, the company is one of the most common distribution channels in the business. It currently has 3000 dealers, out of which 150 are exclusive show rooms. Focused on the continuous development of product range, Vestel Durable Consumption offers the latest technological nnovations to consumers.

Recently, Plasma TV, 100 Hz TV, Super black series TVs, No-Frost refrigerators, air conditioners and hi-fi products are introduced, thus the product range is widened. Vestel Durable Goods Marketing A. Þ. is increasing its market share thanks to innovations. In 1998, the share of Vestel Marketing A. Þ in TV market realized as 30%, 7% in Audio and 5% in white goods. Vestel Durable Goods Marketing s mission is to offer service to its customers both on pre-sale and after sale basis. Thanks to Call-Center, the information related to products and services are simply made available.

A total of 690 service centers and their experienced staffs throughout Turkey offer after sale services. As a result of the synergy created among units, the information flow is ensured, thus the company may efficiently and rapidly respond to market developments. In todays global world, the company follows up the latest trends and implements the innovations, which are considered feasible. Vestel Marketing A. Þ. also pursues investments in continuous development of distribution channels. (Zorlu Holding Company Profile) Their managements point of priority To satisfy their employees.

In this regard, hey are carrying out their operations with their dynamic, experienced and qualified personnel in order to reach pre-established goals. In addition, they are offering the best service to final customers by implementing the most recent marketing methods and focusing on how to offer extra value. The reason is that the customer priorities are continuously changing in recent years. Their mission Going beyond the current expectations of their customers, they are focusing on new marketing activities, which are at the same time encouraging sales.

The main objective of Vestel Marketing To prepare for the era called Customers Who Will Never Satisfy” Because; the customer priorities are rapidly changing in all markets. In this regard, they are offering quality products at reasonable prices and payment conditions by exceeding their expectations via their effective distribution channels. The developments in information processing and communication fields have accelerated the elimination of trade borders, despite the political ones.

As a consequence of Vestel Marketings dynamic structure, they have left the traditional was behind and turned into a firm which sets the market standards by forming “creative strategies” and making innovations. http://www. vestel. com. tr) Vestel Foreign Trade Vestel Foreign Trade was established in 1986 to promote the export of Vestel group products, principally color televisions and, more recently, monitors and satellite receivers. In 1997, it as one of Turkey’s top five exporters with revenues of US$255 million and in 1998; it aims to increase these to US$ 700 million.

The professionalism of this marketing and sales organization and its Aggressive approach growth and rising market shares in major European markets. Between 1994 and 1997, the Vestel Group increased its exports by 450% to 1,600,000 units and its hare of the highly competitive European television market from less than 1% to 7,5%. In 1997 alone, Vestel Foreign Trade doubled its export markets to over 80 countries in Europe, the CIS, Asia, the Middle East, Africa, and South America. In 1998, it will initiate large-scale exports to the US, Canada, China and Australia.

In addition to penetrating new markets, Vestel Foreign Trade will initiate exports of a new range of high-technology products in 1998, such as PC monitors and information technology devices. With the worldwide launch of its Internet set-top-box in early 1998. Vestel as become one of the Global pioneers of this market segment. (Vestel Company Profile) Vestel Foreign Trade’s marketing strategy To supply,” value for money” products at internationally competitive prices, payment terms and delivery times.

Vestel Foreign Trade strives to meet or exceed the specifications of its customers and to anticipate future developments in consumer preferences through close and constant observation of its key export markets and large retailing chains. Vestel’s large retailing accounts include Quelle and Schneider in Germany, Alba in the UK and Carrefour in France. These alliances offer customers just-in-time delivery of customized designs under their own label while securing for Vestel extensive distribution and after-sales services in its target markets.

International Marketing Vestel Holland BV in Rotterdam, Vestel France SA in Paris and VesegGermany GmbH in Saar rücken support Vestel Foreign Trades marketing and sales activities in Europe. In 1999 Vestel Group will establish marketing companies in Spain, Italy and the US. Vestel U. S. A Established in 1998, Vestel Information Appliances Division innovator and manufacturer of a complete family of Internet Information Appliances and is the only North American manufacturer to offer flexible, easy-to-use, Internet-centric hardware solutions for the home and business markets.

Vestel Information Appliances Division is based in Mountain View, California and is a wholly owned subsidiary of Vestel, Inc. with European, Middle East & Africa headquarter located in Istanbul, Turkey. Vestel Visecon Vestel Visecon founded in September 1998, with a strong management view and enthusiastic, dynamic consultant team, which has extensive experience implementing, SAP in major projects within the Zorlu Vestel Holding Group of Companies. Company’s culture is based on honesty, dedication, handwork and quality.

Vestel Visecon aim is to focus on business performance improvement through Enterprise Resource Planning, Supply Chain Management and related products & services. Company started their projects in the second half of 1997 with a core team. In four months company completed Vestel Marketing, Vestel Biliþim and Zorlu Linen projects and five SAP/R3 modules were implemented HR, FI, CO, MM, SD. In the first quarter of 1998 Vestel Electronics project was started and FI, MM, SD, CO, PP, HR modules are implemented in 8 months. Dexar

Dexar Multimedia and Telecommunications was established in early 1998 for the servicing in communication technologies and it is the first company which has signed “Turksat Digital Satellite Platform” agreement with Turk Telekom on March 5, 1999 Dexar is established to introduce digital data transfer technologies via satellite for consumer and corporate users. Dexar has came together with Hughes Network Systems, USA and Raytheon Training Inc. as a strategically alliance. Dexar will provide the following Multimedia and Telecommunication services with DVB (Digital Video Broadcast) technologies.

Direct Pc Services / Turbo Internet BARRACUDA/SPEEDWARE Package Delivery,Multimedia, Webcast, Newscast BOD (Bandwidth On Demand) ISBN-IP (Integrated Satellite Business Network) The vision of the Dexar is; depending on the bulk transponder capacity of TURKSAT 1-B satellite; · To spread usage all over the country combining the content of multimedia and fast and wide spread communication technology according to the needs, · To provide communication availability in requested bandwidth and time period, · To offer high quality telecommunication possibilities in Turkey by making these services available for all companies n anywhere and anytime.

Some of the applications; · Turbo Internet · Interactive Distance Learning · TeleMedicine/TeleEducation · Voice, data and video transmission in close networks (point to point, point to multipoint) · Inteleconference · Multimedia applications · Broadcasting (Webcast, Newscast) (Vestel Company Profile) Vestel Human Resources Philosophy Following the principles embodied in their Credo ” The Human First” they are building up an environment at VESTEL where all of their employees will be working productively, where there is no discrimination of any sort and where the relations are based on mutual espect and trust.

They are aware that the most important element of their continual development is the intellectual capital they possess in VESTEL. Above all, what gives VESTEL its reputation is its hard working, top quality professional cadre. Their aim is to have a common signature, as the Vestel family, under all the great successes and to move ahead altogether successfully. Everyone in Vestel is the leader in his or her area; their flexible organization structure gives everyone the opportunity to have his or her own initiative and to have the responsibilities in their areas.