Clara Chu's Blog

“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.” While the United Nations can provide stability to third world countries and address humanitarian issues, the solutions they offer in terms of relief and aid are not necessarily long term solutions. Resources are tangible and finite; the United Nations can only fund issues only for as long as they can be consumed. For instance, non-profits that donated money to Rwanda following their war were not able to successfully improve the conditions within the country (“Upward Arc”).

Arc Initiative South Africa Conference 2011 (Source: Arc Initiative)

However, the Arc Initiative establishes a different approach to provide “long-lasting economic betterment for local communities”. The organization imparts business knowledge and expertise to young social entrepreneurs to give them the proper decision making tools in maximizing profit and running their business more successfully. By fueling these individuals with the capacity to become leaders, this concept allows for self-sustainability rather than a reliance on external aid.

If the UN lost all its funds, where would they re-establish their resources to function? The answer is that they probably wouldn’t. Contrastingly, social enterprises are self-reliant in attaining the funds necessary to achieve their desired social vision.

Canada’s top 100 employers are selected annually; a competitive process that takes into account:

1) physical workplace

2) work and social atmosphere

3) health, financial and family benefits

4) vacation and time off

5) employee communications focused on how employers capture employee feedback

6) performance management

7) training and skills development

8) community involvement

Tightly knit work environment at the Provincial Health Services Authority. (Source: PHSA)

It really hit close to home when I saw that BC’s Provincial Health Services Authority made the cut. (I always wondered why my dad worked so hard for the company, but it makes sense now, realizing that the corporate culture strongly influenced his work ethic.) Evidently, strong organizational culture can create a difference in employee performance and productivity through employee satisfaction.

While profit maximization will always be a goal for a company, a shift towards corporate culture and innovative HR practices has taken place in the hopes of engaging the work force, consequently creating more of a long-term profitable solution.

A secondary benefit of creating a desirable corporate culture is the fact that this recognition can lead to hiring better-qualified employees. Given that studies have shown that the Millennial generation values flexibility over pay (“Like it or not, Millennials will change the workplace”), intrinsic motivation and as a result, corporate culture, is becoming more of an incentive to our generation than extrinsic factors.

In response to Stella Cho’s blog post “Cable Television: The New Old-Timer”, subscription sites such as Netflix have taken a toll on the cable television industry. The easy accessibility and variety offered by Netflix makes the company a disruptive innovator, allowing consumers to choose what they would like to stream rather than forced into the set-schedule concept of cable TV.

In addition, Netflix has established a strong marketing strategy – their one month free trial. I, myself, have recently taken up this cost-friendly subscription service and intend to continue with it well past the trial date.

Limited edition Fall Fête box from the online beauty subscription site Birchbox. (Source: BirchBox) 

Not only has the online subscription service been a hit within the media market, but this idea has been paralleled within several other industries, including companies such as Birchbox, JewelMint, ShoeDazzle, and NatureBox. These subscription sites often come with profile surveys to determine the best “handpicked” products for customers. With a more customized approach, consumers will likely be inclined to shop from the comfort of their homes. Among these subscription companies are cost-efficient options upwards to high-end products. With the breadth of the retail market, this newly sourced revenue stream is bound to expand, taking over the consumer base originally found shopping in store around malls.

With time, we will see even traditional store-based companies taking on this subscription approach as a way to adapt to change.

With the rise of Ebay and Amazon, these companies have been successful points of exchange for sellers and consumers, thereby expanding the e-commerce world. Similarly Etsy, an online marketplace for handmade crafts, is a platform for aspiring entrepreneurs to bloom their business.

Etsy’s homepage featuring handcrafted items (Source: Etsy)

What makes them different, however, has been their keen sense of focus on sustainability through their vision to help create jobs for craftsmen and artisans within the community while ensuring quality, handmade products to their online shoppers through strict policies. Since October, things have ventured down a different path for Etsy, as they announced guidelines to accommodate the growth of their sellers.

While focused on the growth of the company, they must be careful with the decisions they make. Previously distinguished by their “handmade ethos”, the company’s prospects of expanding have generated complaints from the public, claiming that Etsy has simply become a sales engine like Ebay. I personally care about the workmanship of my jewellery products. In light of many similar customers, the company may well be tarnishing one of their competitive advantages. As a hybrid enterprise with profit maximization in mind, the company must create shared value without compensating the societal need for quality products (Harvard Business Review).

Ever since the move up north in March 2013, the big-box US department store, Target, has faced its fair share of challenges, receiving a disappointing return given the high costs and low sales. As a result of “aligning marketing with the consumer decision journey” (McKinsey & Company), Target has decided to focus on partnerships with Canadian designers, delivering a new value proposition to proud Canadians wishing to sport the latest and greatest.

With their mindset heavily doted on brand recognition within the market segment, Target is igniting the trigger in the consumer’s initial-consideration set. Introducing brands in support of Canadian talent will appeal to the average Canadian consumer. Not to mention Target’s involvement with Toronto and Montreal’s Fashion Week, which will generate hype from fashion-forward divas and build awareness for the high-profile designer collections offered at this department store.

Target Spring/Summer 2015 fashion show at World MasterCard Fashion Week in Toronto (Source: CNW)

In addition, Target is aiming to address operations-related issues of empty shelves and relatively high prices compared to the US. In our world of marketing, a consumer’s final decisions are made in store – without products on shelves, consumers will not even have a visual option to consider. As a result, this issue is of both high urgence and high importance.

Ever scanned through the menu at a local fine dining restaurant and come across this symbol?  (Source: Vancouver Aquarium Ocean Wise)

While consumers are becoming more environmentally conscious, Vancouver locals are also being more vigilant when considering dining options; Ocean Wise being one of the many programs guaranteeing an ocean-friendly seafood choice.

BC salmon farmers, not only wishing to gain recognition on a local scale, are also striving to meet a new global environmental standard, the Aquaculture Stewardship Council certification.

Why would players in the food industry go through such hassle and regulation? To create product market fit (Steve Blank). As we see a growing segment of sustainably selective consumers, the industry is trying to satisfy customer needs. It is a point of difference that is likely going to place certain businesses on a higher playing field, given the rigour of the certification.

For instance, Loblaws, who has been losing market share to domestic and foreign competitors like Walmart, will be the first retailer in North America to sell ASC certified salmon, as a strategy to put them ahead in the game. While it isn’t necessarily the farming method that customers are worried about, the ASC standard will definitely provide a safety assurance, delivering customers a value proposition that fulfills “jobs-to-be-done” (Clayton Christensen).

According to Porter’s 5 forces, threat of new entrants seem to be Taseko Mines Ltd.’s largest issue as of current. With a new government policy imposed to subdue mining activity in their proposed Prosperity Mine due to Chilcotin First Nations land rights, the company will have to undergo a major revamp on their business model in order to sustain their business.

Chilcotin’s Dasiqox Tribal Park includes Fish Lake, above, as well as the site of Taseko’s proposed New Prosperity mine. (The Vancouver Sun)

While Taseko Mines Ltd.’s Fish Lake property is in fact outside the title area of the Chilcotin, the natives, claiming hunting, fishing, and trapping rights “have folded the mine site into the tribal park boundary” (The Vancouver Sun).

Consequently? Taseko Mines is attempting to fight back, though chances of the project continuing are slim to none. As Christy Clark states, “recognizing aboriginal title represents a new “fork in the road” for improved government relations with native people” (The Vancouver Sun), it is evident that the government is prioritizing community over commercial relationships. As a result, Taseko has had to alter its key activities, looking into purchasing the mineral exploration and development company Curis Resources and changing its avenue from Vancouver to central Arizona (The Globe and Mail).

While Taseko has a solid backup plan, what will become of the rest of the commercial sector if the issue of native land rights persists? Is respecting the original inhabitants of Canada more important than the stake of our future economy?

Income inequality has always been an ongoing problem in the USA and even poses a threat to state tax revenue. What’s surprising, however, are the underlying factors causing the issue to occur. Traditionally, the blame has been directed toward income discrepancy amongst management and the blue collar workforce, but time seems to be looking at a shift in trend.

Reading through Walter Frick’s blog post, “The Salary Gap between Stingy and Generous Companies is Growing”, job income inequality is transitioning into exactly what the title suggests – a difference in wages for similar roles in the industry.

Perhaps higher paying companies attract the most skilled workers in the industry and therefore can justify their decision-making or perhaps workers with lower pay are compensated through benefits. What this can only prove is the wide range with which similar companies value their employees and the skills that they bring. It is apparent that placing a dollar sign on the head of each employee is not regulated by a consistent method and therefore makes sense, that the intangible asset of human intellect is NOT included on financial statements.

In fact, can humans be considered an intangible asset? I’m afraid that the current situation doesn’t fulfill the criteria of the second point.

International Accounting Standards Recognition Criteria for Intangible Assets (IAS 38)

Since adolescence, our eyes have always been set on the newest toys around. As mentioned in Lily Du’s post, “Consuming the Consumers”, we often “feel the compulsion to constantly buy the latest and “greatest””. Whether it be plastic blonde Barbie dolls that we’d play with and easily toss aside or egg gadgets known as Tamagotchi’s, the consumer world has always been a strong advocator of the bandwagon effect. The iPod Touch was no different.

In such a consumption-hungry world, the need for companies to keep up with changes, especially in the fast paced IT industry, is crucial. Agreeing with what the blog post mentions, we never really look back on the objects we retire but merely look ahead to the new innovative goods the market will bring.

The evolution of the iPod. (Source)

What I find ironic, however, is that some companies may be impairing themselves in the process, in competition against themselves.

Apple, for example, hurt their iPod Touch sales, with the launch of the iPhone and iWatch. Yes, Apple is “positioning (their) product in the mind of the customer” (Ries and Trout) but they could have strategically planned to keep the iPod Touch in the loop.

While “the first mover has a large advantage that can make up for other shortcomings” (Ries and Trout), it doesn’t mean that they will always stay on top.

After announcing WestJet’s new baggage fee policy on Monday, September 15^th, their stock value instantly skyrocketed. This rise was matched by Air Canada before they even followed suit.

 WestJet’s stock activity from Sept 13th-19th, 2014. (Source: Yahoo! Finance)

Air Canada’s stock activity from Sept 13th-19th, 2014. (Source: Yahoo! Finance)

Comes to show how competitors in the market have a great influence on one another! As “change is inevitable and a leader must be willing to embrace change rather than resist it” (Ries and Trout), it only made sense for Canada’s largest full-service airline to keep up with their competitor and the rest of North America’s airline carriers.

While the concept faced much criticism by the CBC News Community who claims that WestJet’s plan will back fire, I doubt that this will happen. Air Canada and WestJet are the two biggest airline companies in Canada and while they’re head to head with competition, consumers are limited in their options. The baggage fee will be unavoidable for consumers wanting economy-class airfare.

While it is a clever marketing strategy, things sound a little suspicious…seems like price collusion doesn’t it?

Meanwhile, Southwest Airlines Co. will have higher ground by “outperform[ing] rivals with advantages they can preserve” (Harvard Business Review). They have decided to opt out of the policy and will be the more desirable choice when making travel plans.