Although we currently live in the 21st century, poverty and and other social  injustices still exist in many parts of this world. The efforts by the United Nations to bring change have been ineffective. What little change that has occurred is the result of initiatives such ARC, which creates employment for the impoverished people in Ethiopia.

I believe that social enterprises are needed  even if the United Nations is fully funded as the reason of the ineffectiveness of the United Nation’s goes beyond a lack of funding. What the UN has done so far with its foreign aid program is provide  food and infrastructure. While these things can temporarily resolve the problems that plague the impoverished, they don’t solve the root problems such as the lack of education and opportunities, and may actually cause harm in the long run.

Source: Huffington Post

In contrast, the ARC initiative brings sustainable changes by helping the local people develop the skill sets needed to establish a social enterprise, such as Salem’s Ethiopia. The ARC not only allowed the owner to successful expand her business and improve her livelihood, but created jobs for marginalized women who received training in making baskets, This is much more  effective than the UN, as it creates both opportunities and skills that allow the people to become self sustaining, while not displacing local businesses. Such initiatives also isolate the well being of the impoverished from the willingness of foreign countries to provide aid, which is important as the political will of world governments often change, but the need for food does not.

References: http://www.smh.com.au/federal-politics/society-and-culture/does-foreign-aid-do-more-harm-than-good-20110318-1c0a1.html

Source: Eturbonews

During the past ten years, Boeing and Airbus have experienced cutthroat competition as they vied for orders against each other. In an effort to gain an advantage over Boeing, Airbus extended its agreement to produce planes in China, which is world’s fastest growing airplane market. While this cooperation between seems beneficial to both China and Airbus, Airbus is overly short sight-sighted and may end up on the loosing end.

Creating a SWOT analysis for Airbus, I realized that its strengths lie in advanced technology and production methods, which can only be rivaled by Boeing. In addition, it weaknesses lie in its high manufacturing costs, resulting from Airbus’ labour and manufacturing base, which is mainly located in Europe. For Airbus, producing their planes in  China  allows them  to decrease costs slightly, but more importantly make their planes more politically appealing for Chinese customers. For China, Airbus’ manufacturing presence is a secure source of airplanes in times of dispute with Western powers.  More significant, however, is transfer of know how from Airbus to Chinese engineers and technicians.

Given China’s efforts in aerospace development, it is inevitable that they will be able to produce their own airplanes one day. However, by providing China with its technology, Airbus is diminishing its main competitive advantage. Given China’s low cost of labour, China would also be exploit Airbus’ weakness and eventually steal market share away from them. I believe it was prudent for Airbus to build a factory in China, since China would buy their planes anyway, as shown by China’s continued orders of Boeing airplanes, which are all produced in the US. I believe Airbus needs to re-evaluate its strategy using an alternatives graph, and determine whether the cost of developing planes in China outweighs the benefits.

References:

http://www.reuters.com/article/2014/03/26/us-france-china-airbus-idUSBREA2P1HZ20140326

http://www.airbus.com/company/worldwide-presence/airbus-in-china/

http://www.airbus.com/presscentre/pressreleases/press-release-detail/detail/airbus-and-china-take-their-partnership-into-the-future/

In the past 20 years, Visa and MasterCard have become household names as more and more of us refuse to carry cash and use credit for all our payments. Along with the advent of online retailing, where credit is often the only payment accepted, Visa and MasterCard have seen their profits grow. Yet their profits may soon decline after being forced to lower their merchant fees, where they make most of their profit, under the threat of regulation by the Harper government.

Who Needs Plastic? Source: Engadget

This is prime example of Visa and MasterCard’s failure to conduct a thorough PEST analysis on their business model. Despite having ample warning of political threats through similar situations in other countries, such as the EU, where merchant fees are kept at a low 1.5%, Visa and MasterCard continued relying on merchant fee model to make their profits. As a result, they now face loosing a big portion of the 6 billion dollars they make per year. Additionally, Visa and MasterCard also face challenges technologically, such as new payment methods such as Apple Pay, which could offer far greater convenience to consumers. With such new developments, Visa and MasterCard has develop a new business model.

In the short run, Visa and MasterCard are expected to regain some of the losses, through increasing annual fess, and reducing cardholders incentives. However, such a strategy will not be viable in the long run, with many consumers inclined to use a credit card only to gain Air Miles for cash regards and air tickets. To develop a viable strategy in the long run, Visa and MasterCard must capitalize on their strengths, such as their global network and branding, to remain relevant in an ever-changing business environment.

Reference: http://www.theglobeandmail.com/globe-debate/editorials/lower-credit-card-fees-good-lower-costs-unlikely/article21447600/

Over the past ten years, technology, and specifically the internet, has truly revolutionized the shopping experience. Nowadays, it is possible purchase a product you want by simply logging onto Amazon or Ebay, putting the item in your virtual shopping cart, and checking out with your saved credit card details. Such convenience has affected shopping malls which are increasingly threatened not only by online retailers such as Amazon and Ebay, but traditional retailers such as Best Buy and Ameican Eagle, who also sell directly through the internet.

How Convenient Can it Get? Source:http://infotel.lk/

In order to adapt to the changing market, I believe malls and traditional  retailers need to redefine their value proposition, POPs, and PODs. In the past, the convenience from consolidating hundreds of stores might be considered a POD for a shopping mall. But in the age of technology, this is simply a POP, with online retailers offering products from millions of sellers. In an effort to differentiate themselves, stores like  “Canadian Tire’s Sport Chek” have added “digital screens and interactive displays,” yet this doesn’t really create any additional value for the customer. Dawn Lye also states in her blog post that developing such “advanced technology today is… extremely difficult [and expensive]”. On the other hand, other malls have started targeting a different segment, adding retailers that sell high-end goods. For such malls, their value proposition is relieving the worry of buying fakes and the offering a centralized location with every luxury brand. By targeting a segment that values being able to try and feel the product, these malls have redefined their POD by highlighting a part of the shopping experience that online retailers can not match. 

References: https://blogs.ubc.ca/dlye/