Re: Creativity: Why It Matters

In her blog, Creativity: Why it matters, Vivian discusses the importance of creativity to the workplace. She discusses the uncertainty which managers try to avoid by not encouraging creativity as the workplace become more diverse. She notes that creativity can act as a more effective motivator, shifting from extrinsic reward systems towards intrinsic reward systems; encouraging creativity can increase employee job satisfaction, thus bringing better results.2

Vivian has provided very interesting and valid points; however, in addition, I will further discuss the increase in productivity which creativity brings to the company. Creativity allows employees to work without boundaries and constraints: traditional practices will be forgotten and every step in the new process will be up for questioning3. Enabling employees to question the process which they do their work will allow them to think of more efficient ways to do them, therefore increasing productivity.

Creativity will encourage people to stop underestimating their ideas1 and allow employees to feel an empowerment to change their workplace3. Sometimes one simple idea can make things easier1. The empowerment will encourage further discussions and analysis into solving issues3. Solutions developed by a number of motivated experts means that there will be more effective solutions because many perspectives will be heavily considered in the process of generating solutions.

The fear of failure will be removed and people will have a lower level of uncertainty avoidance in creative environments3. When people have the “freedom to fail,” they will learn more about their field through their failures, hence their level of expertise will rise. A greater level of expertise means a greater potential for creativity, which in turn will lead to more effective ideas.

 

Word Count: 275

 

References

1 Brown, N. (2008, August 5). Why you absolutely need creative employees. Retrieved April 2, 2017, from Fortune website: http://fortune.com/2015/08/05/nancy-brown-creative-thinking-at-work/

2 Guo, V. (2017, January 31). Creativity: Why it matters [Blog post]. Retrieved from Vivian Guo’s Blog: https://blogs.ubc.ca/vguo/2017/01/31/creativity-why-it-matters/

3 Jones, B. (2014, June 19). 5 ways creativity leads to productivity. Retrieved April 2, 2017, from Entrepreneur website: https://www.entrepreneur.com/article/234997

Image Source

Low poly lightbulb as creativity and idea concept [Image]. (2016, February 19). Retrieved from http://blog.socialcast.com/3-ideas-to-get-more-creative-input-from-group-brainstorming/

[Embracing passion and creativity]. (2015, June 15). Retrieved from http://www.blogs.jbs.cam.ac.uk/socialinnovation/2015/06/26/embracing-passion-and-creativity/

 

 

Re: Can the MBTI Define Who I Am?

In her post, Can the MBTI Define Who I Am?, Maxine (Mei Qing) Chen discusses the inconsistencies of her Myers-Briggs personality test results – changing from INFJ to ESTJ in one year. She claims that the MBTI is unreliable and may have hidden risks1.

While there are limitations to the MBTI, the MBTI should not be totally discredited. Maxine describes the MBTI as dichotomic, but, as I have mentioned in my earlier post, the MBTI also consists of a report which further describes the details of where you lie on the spectrum on each of the dimensions, therefore is more continuous. Although research has shown consistencies with the MBTI, results become more consistent as people age2, therefore her personal experience of having such a dramatic change in just one year may not be a surprise: there is always going to be variance and outliers.

However, Maxine’s point of self-fulfilling prophecy1 does provide an explanation for the variances, therefore the MBTI should be used repetitively in the long-run and should not just be a one-time thing. There is also the factor that our personality is influenced by the environment we are in; MBTI may need to find better ways of accessing people in different situations.

Maxine notes that people take the MBTI tests too seriously1, but I think people should also not completely disregard the fact that there may be some truth in the MBTI. Studies have proven the reliability and the validity of the MBTI.2, 3 People just have to keep in mind that there will always be residuals and variance in the sample data.

So to answer Maxine’s question “Can the MBTI define who I am?,” I would say that it is quite plausible that the MBTI can provide some aspect of truth into our personality, and thus we should not let residuals and variance make us completely discredit the MBTI.

Word Count: 310

 

References

1 Chen, M. Q. (2017, February 4). Can the MBTI define who I am? [Blog post]. Retrieved from Mei Qing (Maxine) Chen’s Blog: https://blogs.ubc.ca/mchen/2017/02/05/can-the-mbti-define-who-i-am/

2 Carlson, J. G. (1985). Recent assessments of the Myers-Briggs Type Indicator. Journal of Personality Assessment, 49(4), 356-365. Retrieved from UBC Library Catalogue database. (Accession No. 6388089)

3 Thompson, B., & Borrello, G. M. (1986). Construct validity of the Myers-Briggs Type Indicator. Educational and Psychological Measurement, 46(3), 745-752. https://doi.org/10.1177/0013164486463032

Image Source

16Personalities. (n.d.). Logician [Illustration]. Retrieved from https://www.16personalities.com/personality-types

Re: The Myers-Briggs Personality Test Doesn’t Actually Mean Anything

Within 3 years, I have taken the Myers-Briggs test at least 5 times – every time I get the same result: ENFP (except that one time when I got ENTP).

The Meyers-Briggs Type Indicator (MBTI) is the most widely used assessment for career counselling4. Bratskeir (2016) and Fox (2016) argues that the MBTI is meaningless and only a form of entertainment like horoscopes or psychics. They draw upon a study indicating that half of the participants did not receive consistent classifications and the fact that the MBTI were created by two women who had no psychological background. They argue that personality is too dynamic and complex for the MBTI to classify within 16 personality types. 1, 3

Although we cannot expect the MBTI to be spot-on every time, scholars do suggest that there are general consistencies with the MBTI, that the MBTI can predict behaviour2, and that the MBTI is a valid measure of personality5. The MBTI is a way to allow for an empirical assessment of personality based on Carl Jung’s theory of personality (his theory consisted of terms and phrasing that were too ambiguous and ill-defined)2. However, the MBTI is not a predictor of which academic specialization an individual chooses but only because factors such as culture and education were not included in the study4.

I believe that Bratskier (2016) and Fox (2016) does not recognize that the MBTI does not solely identify a person with one trait or the other. The MBTI generalizes an individual’s type within each dimension, but also includes a detailed assessment on where one lies on the spectrum of the dimension. Looking at the conclusion is not enough if an individual wants a personality analysis of him- or herself – they will need to analyze the more detailed report. Explanations of inconsistencies in studies may be that a person has a high degree of Machiavellianism or self-monitoring: changes in behaviour and thought impacting their attitude, and hence their answers to the MBTI, because of environmental changes. Another possibility that has not been really identified is if certain personality types are more easily subjected to change.

 

Word count: 349

 

References

1 Bratskeir, K. (2016, February 10). The Myers-Briggs personality test doesn’t actually mean anything [Blog post]. Retrieved from The Huffington Post website: http://www.huffingtonpost.com/entry/myers-briggs-personality-test-is-moot_us_56bb69abe4b0c3c5504f9b36

2 Carlson, J. G. (1985). Recent assessments of the Myers-Briggs Type Indicator. Journal of Personality Assessment, 49(4), 356-365. Retrieved from UBC Library Catalogue database. (Accession No. 6388089)

3 Fox, A. (2016, October 27). The Myers-Briggs personality test is fun, but not so informative [Blog post]. Retrieved from The Huffington Post website: http://www.huffingtonpost.com/entry/personality-tests-not-accurate_us_58123acfe4b064e1b4b0fd8a

4 Pulver, C. A., & Kelly, K. R. (2008). Incremental validity of the Myers-Briggs Type Indicator in predicting academic major selection of undecided university students. Journal of Career Assessment, 16(4), 441-455. https://doi.org/10.1177/1069072708318902

5 Thompson, B., & Borrello, G. M. (1986). Construct validity of the Myers-Briggs Type Indicator. Educational and Psychological Measurement, 46(3), 745-752. https://doi.org/10.1177/0013164486463032

Image Source

16Personalities. (n.d.). Campaigner personality [Illustration]. Retrieved from https://www.16personalities.com/enfp-personality

16Personalities. (n.d.). “It’s so incredible to finally be understood.” [Illustration]. Retrieved from https://www.16personalities.com/

Millennial Leadership: Changes to Workplace Culture

The first generation to integrate computers into day-to-day activities, millennials are soon to dominate the workplace. With noticeably distinct cultural values, when compared to the preceding Gen Xers or Baby Boomers, millennials challenge traditional practices in business and corporate leadership. Millennials have redefined leadership to be inspiring, and making a positive impact.1 How will business culture be affected by this new type of thinking?

Monych (n.d.) explains that millennials lead with a democratic approach, encouraging collaboration, transparency, and openness over the top-down, driven by power and money sort of approach. Technology can cut through the levels to allow the communication structure throughout the organization be like a network rather than a chain of command.3

Millennials prefer a conceptual approach to leadership, therefore encouraging creativity, which can lead to the development of valuable ideas. The crave for challenges and new experiences drives the motivation; changes, failures, and mistakes cannot barricade millennials from trying to achieve their ambitions since they have grown up with a mindset that everything they did was wonderful and everyone contributed to the purpose.3

The effects of the millennials’ approach to leadership can be examined through Hofstede’s model2 for assessing organizational cultures:

Due to experience and making an impact being the driving factor motivation and the millennials’ honesty with a lack of fear for risks and failures, organizations will be goal-oriented and internally driven, that is companies will look beyond obstacles and take greater risks to accomplish its vision and mission. Organizations will become easy-going, open, local, and employee-oriented. Since transparency and empowerment are key characteristics to the millennial approach to leadership, employee issues can be openly discussed and the flatter power structure will allow employees to have an interpersonal relationship with their managers. As work and personal life become heavily integrated, the company will provide a greater care for the welfare of the employees.

Not only do I believe that this type of leadership will enable managers and employees to develop greater trust for each other, I believe that optimism and overlooking obstacles will spark zeal in every employee as more interests of the organization and the employees will align.

Word Count: 353

 

References

1 Brousell, L. (2015, August 4). How millennials challenge traditional leadership. Retrieved February 4, 2017, from CIO website: http://www.cio.com/article/2956600/leadership-management/how-millennials-challenge-traditional-leadership.html

2 Hofstede, G., Neuijen, B., Ohayv, D. D., & Sanders, G. (1990). Measuring organizational cultures: A qualitative and quantitative study across twenty cases. Administrative Science Quarterly, 35(2), 286-316. http://dx.doi.org/10.2307/2393392

3 Monych, B. (n.d.). Millennials in charge: How they’re changing the workplace [Blog post]. Retrieved from Insperity website: http://www.insperity.com/blog/millennials-in-charge-how-theyre-changing-the-workplace/

Image Source

[Millennials at a conference table]. (2014, April 16). Retrieved from https://www.thindifference.com/2014/04/top-5-leadership-traits-millennials/

Changing One HR Policy for a More Effective Workplace?

Performance reviews have long been used as a feedback channel in business culture, but is it time for a change? Leadmen (2017) explains that performance reviews do not have a helpful and constructive effect, creating no impact on how employees do their work – performance reviews have wasted time for employees and managers.3

Leadmen mentions a study by Adobe, indicating that employees prefer informal, on-the-spot feedback instead of periodic formal reviews. Adobe’s study shows two thirds of employees and managers believe performance reviews are outdated.3 Performance reviews have been emotionally rattling for most employees and most employees just fake through reviews, hiding their tears1 (this might increase emotional labour). I believe the negative mood that performance reviews bring is a root cause to the deterrence of the effectiveness of performance reviews.

Immen (2012) notes Professor Culbert’s argument that many managers are not confident that they can motivate without fear, whereas HR encourages reviews so HR can be busy and appear important. Professor Culbert suggests providing feedback should be an informal, two-way conversation: performance reviews are just one way where bosses provide review, but subordinates fail to have their viewpoint expressed. Culbert also claims that during performance reviews, managers use phrases with encoded meanings. He argues that holding both employees and managers accountable for providing feedback results in building trust within the workplace.2 Mayer et al. (1995) suggests that trust is developed through integrity (honesty and truthfulness), ability (technical and interpersonal knowledge), and benevolence (having others’ interests at heart)4.

Professor Culbert’s solution does contain the three characteristics for trust: having an open environment allows honesty to flow and the understanding of each other’s ability to help fulfill the interests of individuals and the organization. However, convincing managers to change may be a cumbersome process. In some settings, the corporate culture may not allow the feedback to generate an effective solution to problems (such as when younger employees and older managers differ greatly in the way they practice business), therefore the effectiveness of feedback is not only dependent on the openness and understanding of employees and managers, but also how well the solution align with organizational and individual interests.

Word Count: 356

 

References

1 Adobe. (2017, January 11). Full study: Performance reviews get a failing grade. Retrieved February 4, 2017, from Slideshare website: http://www.slideshare.net/adobe/full-study-performance-reviews-get-a-failing-grade/1

2 Immen, W. (2012, August 23). A failing grade for performance reviews. Retrieved February 4, 2017, from Globe and Mail website: http://www.theglobeandmail.com/report-on-business/careers/career-advice/a-failing-grade-for-performance-reviews/article1243140/

3 Leadem, R. (2017, January 17). To make your employees happier, lose this HR policy. Retrieved February 4, 2017, from Entrepreneur website: https://www.entrepreneur.com/article/287797

4 Mayer, R. C., Davis, J. H., & Schoorman, F. D. (1995). An integrative model of organizational trust. The Academy of Management Review, 20(3), 709-734. Retrieved from JSTOR database.

Image Source

[Performance review]. (2016, November 3). Retrieved from https://culturestars.com/tag/performance-review/

Training and performance [Image]. (n.d.). Retrieved from http://www.insperity.com/blog/are-annual-employee-performance-reviews-really-dead/

Mental Health and the Workplace

Many people let this one slide, but how many times have you asked how your mental health has affected your work life? Landrum (2017) argues that we need to rethink and adapt business culture because millennials report a higher number of cases for depression than previous generations. 45% of the cases are untreated – resulting in a potential economic cost of $147 billion annually.3

She mentions that in an interview, Simon Sinek suggests that the millennials’ “cultural fascination” with social media is a key cause of depression because the obsession of the newsfeeds of friends and neighbours reduces the feeling of security of our own lives and accomplishments. Furthermore, every time we receive desired notifications (such as likes), a dose of dopamine is released in our body; as the doses accumulate, we become more dependent and depressed.3 Sinek notes that millennials were not properly raised; they were raised in a more subjective and individualistic environment.1

Because social media has created the loss of security, I believe the belonging and self-esteem needs from Maslow’s hierarchy4 seem to be most affected by the changes in the millennials’ culture, values, and attitudes, therefore reaching the self-actualizing level is rather difficult and may require hard emotional labour. Studies have shown that people often forget that their friends on social media only post the greatest highlights of their lives2 and equity theory seems to apply to this case (people seem to feel under rewarded).

When coming to job enrichment, managers and employees should be able to collaborate when redesigning jobs. Designing a job that suits the family and social values of millennials will help create a healthier workplace culture that discourages excess use of social media and encourages putting value into things employees do in life. Together, employees and managers can design a workplace culture through job redesign that is supportive for those suffering from depression.

Word Count: 310

 

References

1 Crossman, D. (2016, October 29). Simon Sinek on millennials in the workplace [Video file]. Retrieved from https://www.youtube.com/watch?v=hER0Qp6QJNU

2 Degges-White, S. (2015, July 16). 17 minutes a day?: How many minutes a day on your cellphone is too many? Retrieved January 26, 2017, from Psychology Today website: https://www.psychologytoday.com/blog/lifetime-connections/201507/17-minutes-day

3 Landrum, S. (2017, January 17). Why millennials are struggling with mental health at work. Retrieved January 25, 2017, from Forbes website: https://www.forbes.com/sites/sarahlandrum/2017/01/17/why-millennials-are-struggling-with-mental-health-at-work/#668079714a9b

4 McLeod, S. A. (2016). Maslow’s hierarchy of needs. Retrieved January 26, 2017, from Simply Psychology website: http://www.simplypsychology.org/maslow.html

Image Source

Leadership and management [Image]. (n.d.). Retrieved from http://www.insperity.com/blog/ millennials-in-charge-how-theyre-changing-the-workplace/

Re: Why Businesses that Profit Off the Culture of others are Not Socially Responsible

"Promotional material from Ungava's Facebook page." Image Source: Huffington Post
“Promotional material from Ungava’s Facebook page.”
Image Source: Huffington Post

The use of cultural appropriation in marketing and branding is becoming a trend among businesses as stated in Karina’s blog post2. Her post discusses Ungava and Urban Outfitter’s usage of the cultural appropriation of North American First Nations. Ungava, a Canadian gin company from southern Quebec, has drawn themes into its marketing from the Inuit First Nations in Quebec. Ungava has used “Asian women dressed in skimpy parkas” as a way of advertising for the gin, along with a random, meaningless mix of Inuktitut syllabics, and Inuit imagery. The vice-president for economic development at Makivik Corp (who represents Quebec’s Inuit), Andy Moorhouse, stated that he was offended by Ungava’s usage of Inuit cultural appropriation.1 Meanwhile, in 2012, Urban Outfitters has been using the Navajo Nation’s name to brand a whole line of products, leading to a lawsuit that the Navajo Nation filed against Urban Outfitters. Although the Indian Arts and Crafts Act and federal trademarks still stand, the court ruled in favour of Urban Outfitters stating that the use of Navajo is a “descriptor of style rather than origin”, therefore not an infringement.4

I totally agree with Karina’s point2 that this kind of cultural appropriation could result in false stereotypes of a culture and is profoundly disrespectful to the culture. As Porter has mentioned, companies that create economic and societal value have a competitive advantage.3 Ungava’s indiscriminate usage of Inuit themes wrecks not only the societal value that the company is supposed to have with the Inuit communities, but also the trust between the company and the Inuit communities. With Urban Outfitter’s case, the firm might create a totally different, unrealistic image of the Navajo Nation. I believe that the inappropriate exploitation of cultural appropriation is not only no socially responsible, but also unethical. I see this as a way for companies to exploit a segment’s disadvantage of not knowing a particular culture. Governments should have a way of regulating this because the values within the traditions and themes in culture could easily be forgotten and be replaced with the value the marketers re-attached with the traditions and themes. The new portrayals may also create negative connotations to that particular culture, turning a good image to an evil image, or a serious image to an indiscriminate image.

Word Count: 377

 

References

Hamilton, Graeme. “Inuit Say Gin Maker Needs to Compensate for Appropriating Culture.” National Post, 2 Oct. 2016, news.nationalpost.com/news/canada/inuit-say-gin-maker-needs-to-compensate-for-appropriating-culture. Accessed 13 Nov. 2016.

Kong, Karina. “Why Businesses That Profit off the Culture of Others Are Not Socially Responsible.” Karina Kong’s Blog, UBC Blogs, 30 Oct. 2016, blogs.ubc.ca/kkong/2016/10/30/why-businesses-that-profit-off-the-culture-of-others-are-not-socially-responsible/. Accessed 13 Nov. 2016.

Porter, Michael E., and Mark R. Kramer. “Creating Shared Value.” Harvard Business Review, PDF ed., 2011, pp. 62-77.

Randolph, Imani. “Fashion’s Appropriation of Navajo Culture Has Been Deemed Legal.” Fader, 15 July 2016, www.thefader.com/2016/07/15/urban-outfitters-navajo-nation. Accessed 13 Nov. 2016.

Image Source

“Promotional Material from Ungava’s Facebook Page.” Huffington Post, 15 Sept. 2016, www.huffingtonpost.ca/2016/09/15/ungava-gin-inuit-cultural-appropriation_n_12017002.html. Accessed 13 Nov. 2016.

 

Re: Catalytic Philanthropy: Innovating Where Markets Won’t and Governments Can’t

Source: Gatesnotes
Image Source: Gatesnotes

In his blog post, Catalytic Philanthropy: Innovating Where Markets Won’t and Governments Can’t, Bill Gates discusses the idea of catalytic philanthropy, an interesting concept which correlates with a number of topics in business. The practices of catalytic philanthropy goes further than “just writing a cheque”. Gates describes catalytic philanthropy as investing into new innovations and technologies that bring massive returns to people in need or to the society. He describes that catalytic philanthropy lies in a gap between the government and the private sector because governments are in a position such that a justification for bringing innovations into countries outside of their own is very hard to develop and because the returns for the innovator are too low for the private sector to even consider.1

I find that the idea of catalytic philanthropy ties in with corporate social responsibility and creating shared value 2. Gates mentioned in his post, not enough is being accomplished and the potential is far greater than what we have seen.1 As Michael Porter has mentioned in his article, Creating Shared Value, the mainstream practices of corporate social responsibility does not seem to create enough shared value.2 However, innovation is a key component of catalytic philanthropy and that this innovation creates more shared value between companies (or governments or individuals), charities, and the community. I believe that for corporations, creating value should not only be profit driven. Without innovation, the contributions which we make to charities will not be as effective and society as a whole may not receive the maximum benefits from the donation. The innovation that is generated from catalytic philanthropy can potentially create more sustaining value.

Source: Realdania
Image Source: Realdania

I do not think that it is just wealthy individuals and charities who should practice catalytic philanthropy; governments and companies should also integrate the practices of catalytic philanthropy as one of the core values which all of the bodies that encompasses that entity needs to have their activities aligned with. Our current society does not have a system that is effective enough in providing innovative solutions to our greatest issues. The co-operation between different bodies seem too limited to resolve issues on a global scale and in the long run. Catalytic philanthropy seems to be a way of providing better incentives and collaborating resources more effectively towards engineering solutions to deal with our issues.

Word Count: 387

 

References

1 Gates, Bill. “Catalytic Philanthropy: Innovating Where Markets Won’t and Governments Can’t.” Gatesnotes, 27 Mar. 2014, www.gatesnotes.com/About-Bill-Gates/Catalytic-Philanthropy-Innovating-Where-Markets-Wont. Accessed 12 Nov. 2016.

2 Porter, Michael E., and Mark R. Kramer. “Creating Shared Value.” Harvard Business Review, PDF ed., 2011, pp. 62-77.

Image Source

Catalytic Philanthropy. Gatesnotes, 19 Sept. 2012, www.gatesnotes.com/About-Bill-Gates/The-Power-of-Catalytic-Philanthropy. Accessed 12 Nov. 2016.

“Catalytic Philanthropy.” Realdania, www.realdania.org/nyheder/catalytic-philantrophy. Accessed 12 Nov. 2016.

Re: Blackberry – Transition from Hardware to Software

The new Blackberry Classic smartphone is shown during a display at the launch event in New York, December 17, 2014. REUTERS/Brendan McDermid
Blackberry Classic smartphone REUTERS/Brendan McDermid

As Mikayla3 has mentioned in her post, Blackberry Ltd. has decided to terminate production on hardware and to invest its capital on software development. Instead, Blackbery will outsource hardware from an Indonesian firm, BB Merah Putih.2 Mikayla his indicated that this pivot is related to Blackberry’s strategy on the playing field. She claims Blackberry’s past strategy has been based off of Michael Porter’s5 concept of sustaining competitive advantage; however, Blackberry is beginning to shift to strategies based on Rita McGrath’s4 transient advantage.

Mikayla does have a point on Blackberry’s change in strategy as the company has disengaged with hardware and is beginning to launch and ramp up advantages in its improved line of software.3 However, Blackberry’s transition from a mix of hardware and software products to just software products seems more than just a strategy changing from sustaining competitive advantage to transient advantage. Blackberry’s decision is also a financial and accounting decision. As their income statement1 indicates a decline in revenue for hardware and an incline in revenue for software, it would be wise for Blackberry to invest all its capital into software. Since managers are supposed to create value through their decisions6, it seems that Blackberry is pivoting to a solely software based company because Blackberry is losing the value created in their hardware and that it is too late to invest into more research and design in their hardware.

Mikayla states that the switch over will improve the operational effectiveness of Blackberry because it will help Blackberry with its “forward movement towards the productivity frontier curve” as Blackberry will be able to demonstrate “inherently reliable, controlled, and secured” applications.3 However this is not the only factor that will improve the operation effectiveness of Blackberry. Because Blackberry is in a state of decline, specializing in one area will help the company simplify itself so that it will be able to know which direction to head off for the future for potential growth. Staying in one field seems to enable Blackberry to reduce costs and save resources as the company will not have to worry as much for the hardware.

Word Count: 350

References

1 Blackberry. “Investor_presentation_Q2_FY16_(Sep).” PDF file, Sept. 2015.

2 Evans, Pete. “Blackberry to Outsource Smartphone Manufacturing from Now On.” CBC News, CBC, 28 Sept. 2016, www.cbc.ca/news/business/blackberry-hardware-loss-1.3781876. Accessed 29 Oct. 2016.

3 Mikayla Trang. “Blackberry – Transition from Hardware to Software.” Mikayla Le’s Blog, UBC Blogs, 1 Oct. 2016, blogs.ubc.ca/mikaylatrangle/. Accessed 29 Oct. 2016.

4 McGrath, Rita Gunther. “Transient Advantage.” Harvard Business Review, PDF ed., 2013, pp. 62-70.

5 Porter, Michael E. “What Is Strategy?” Harvard Business Review, PDF ed., 1996, pp. 61-78.

6 Walther, Larry. “Planning, Directing, and Controlling.” PrinciplesofAccounting.com, 2016, www.principlesofaccounting.com/chapter-17/planning/. Accessed 29 Oct. 2016.

Image Source

McDermid, Brendan. “The New Blackberry Classic Smartphone Is Shown during a Display at the Launch Event in New York, December 17, 2014.” Reuters, 5 June 2016, www.reuters.com/article/uk-blackberry-strategy-idUSKCN0ZL1JF. Accessed 29 Oct. 2016.

‘Tinderization of retail’: Another Effect of Our Dynamic and Fragmented Markets

Andreas Rentz/Getty Images Source url: http://www.businessinsider.com/tinder-culture-is-hurting-retailers-2016-10
Andreas Rentz/Getty Images
Image Source: Business Insider

Swipe left to reject, swipe right to show you’re interest; then another profile comes up because maybe, just maybe this guy is better than the last. However, it seems as if Tinderization is not only affecting dating, but also the way we shop in today’s globalized, diverse, and dynamic market environments. Just like with Tinder, where will always be a brand that shows up right after you swipe right. With so many choices, shoppers are constantly faced with the sense of a possibility of a better deal, leading “to a sharp decline in brand loyalty”3. The attention span of consumers shorten and consumers now prefer to purchase goods at a time of need or want rather than in event cycles.3

I believe the ‘Tinderization of retail’3 brings a greater importance to the positioning of a company or product and to the comprehension of a company’s positioning within the market. Al Ries and Jack Trout4 has already stated that getting into a customer’s mind is very important. Being first will give a company a greater advantage4. Because our markets are now so dynamic and that consumers have a shortening attention span, I think companies will need to find more effective ways to constantly change their marketing techniques. The life-span of certain competitive advantages which a company attains in terms of marketing and promotion may be shortening as consumers will get bored of new promotions faster with their shorter attention span. Companies need to consider Transient Advantage2, and they will have to launch competitive cycles quite frequently.

Getty Images Source url: http://www.businessinsider.com/tinder-culture-is-hurting-retailers-2016-10
Getty Images
Image Source: Business Insider

Tinderization has probably been a big factor to the shift of customer behavior and decision making from the Tunnel Analogy to a more cyclic model (like the McKinsey model1). Because new, and potentially better, options are constantly being introduced to the consumer, the number of companies that the consumer considers is constantly changing until the consumer decides on one brand, but even after purchase, the consumer’s evaluation of a brand is still ongoing as the consumer creates expectations with the vast amount of new information he or she receives after purchase. However, Tinderization seems to be beginning to lead consumers away from the loyalty route and bring them back to the active evaluation phase of the McKinsey Model. Because trends, news, and preferences are changing at an increasing rate, the expectations consumers create after purchase may not match the company’s brands unless the company modifies its brands to be able to chase consumer’s metamorphosing needs. Points of parity and points of differences must be assessed carefully within a company in order to sustain consumer loyalty.

Word Count: 430

 

References

1 Court, David, et al. “The Consumer Decision Journey.” McKinsey & Company, June 2009, www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-consumer-decision-journey. Accessed 15 Oct. 2016.

2 McGrath, Rita Gunther. “Transient Advantage.” Harvard Business Review, PDF ed., 2013, pp. 62-70.

3 Peterson, Hayley. “Tinder Culture Has Taken Over, and Now It’s Killing Retail.” Business Insider, 15 Oct. 2016, www.businessinsider.com/tinder-culture-is-hurting-retailers-2016-10. Accessed 15 Oct. 2016.

4 “Product Positioning.” Quick MBA, International Centre for Management and Business Administration, 2010, www.quickmba.com/marketing/ries-trout/positioning/. Accessed 15 Oct. 2016.

Image Source

“Getty Images.” Business Insider, 15 Oct. 2016, www.businessinsider.com/tinder-culture-is-hurting-retailers-2016-10. Accessed 15 Oct. 2016.

Rentz, Andreas. “Andreas Rentz/Getty Images.” Business Insider, 15 Oct. 2016, www.businessinsider.com/tinder-culture-is-hurting-retailers-2016-10. Accessed 15 Oct. 2016.

Commerzbank to change their strategy in the financial arena; are their decisions the right ones?

The headquarters of Germany's Commerzbank are photographed behind the Euro sign in Frankfurt, Germany, September 30, 2016. REUTERS/Kai Pfaffenbach
“The headquarters of Germany’s Commerzbank are photographed behind the Euro sign in Frankfurt, Germany, September 30, 2016.” REUTERS/Kai Pfaffenbach

In hopes of coping with negative interest rates, Commerzbank, Germany’s second largest bank, recently announced a massive restructuring. The process will last until 2020, cutting 9,600 jobs and costing €1.1 billion. The bank will merge its major units and to focus on two customer segments: corporate clients and small-businesses. There will be a suspension of dividends after 2016 payments.2 The bank is expecting “a small net profit” for 2016. Through restructuring, Commerzbank aims to reduce operation costs and create a cost-effective structure by simplifying the structure of the bank and by reducing trade activities, to “[evolve] into a digital enterprise” by investing in digitalization, and to raise market shares.1

Commerzbank’s new strategy seems promising as they use their new strategy to overcome the threats of the sharply fluctuating markets and weaknesses within their cost structure. In the idea of Transient Advantage, a successful company “must be willing to honestly assess whether current advantages are at risk”.3 In Commerzbank’s case, they see that their cost-structure as a competitive advantage is at risk, therefore they are calling to restructure to simplify their cost-structure. It is important for Commerzbank to refocus their key activities through the disengagement3 of certain products to better deliver their value propositions. Porter mentioned in his article, What is Strategy, “operational strategy and effectiveness are both essential to superior performance”.5 Commerzbank’s simplification may allow for better operational effectiveness, while they try to launch, ramp-up, and exploit3 new advantages allow for better operational strategy. Because the competition for banks in Germany is extremely fierce at the moment2, Commerzbank made the right decision to work on their competitive strategy.

Stakeholders at risk of the restructuring of Commerzbank may include customers and clients, shareholders, and employees. The employees will be affected the most as many will lose their jobs. The massive job cuts may pose an ethics issue. A large group of people will now be unemployed and with the banking industry’s instability and sharp fluctuations4, there may be some difficulty for these people to find jobs afterwards; however, conversely if Commerzbank continues with an inefficient cost-structure and decreasing revenues, the bank may fall into trouble, resulting in possibly jeopardizing even more employees.

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References

1 Commerzbank. “Commerzbank 4.0.” PDF file, 30 Sept. 2016.

2 Henning, Eyk, and Ulrike Dauer. “Commerzbank to Slash Jobs, Scrap Dividend in Broad Revamp.” The Wall Street Journal, 29 Sept. 2016, www.wsj.com/articles/commerzbank-to-slash-jobs-scrap-dividend-in-broad-revamp-1475139832. Accessed 2 Oct. 2016.

3 McGrath, Rita Gunther. “Transient Advantage.” Harvard Business Review, PDF ed., 2013, pp. 62-70.

4 Melby, Caleb, and Angela Cullen. “Fines, Withdrawals, Job Cuts. It Was an Ugly Day for Global Banks.” Bloomberg, 29 Sept. 2016, www.bloomberg.com/news/articles/2016-09-29/from-deutsche-bank-to-wells-fargo-a-bad-run-for-giant-lenders. Accessed 2 Oct. 2016.

5 Porter, Michael E. “What Is Strategy?” Harvard Business Review, PDF ed., 1996, pp. 61-78.

Image Source

Pfaffenbach, Kai. “The Headquarters of Germany’s Commerzbank Are Photographed behind the Euro Sign in Frankfurt, Germany.” Reuters, 30 Sept. 2016, www.reuters.com/article/us-commerzbank-restructuring-idUSKCN11Z13T. Accessed 2 Oct. 2016.

Volkswagen Emissions Scandal

Image Source: http://www.schoolphotoproject.com/cars-motorbikes/volkswagen-logo-photo2.html
Volkswagen.  Source

In September of 2015, Volkswagen admitted to the installation of a software that may be used to cheat on emissions tests in 11 million diesel cars worldwide. The software detected when the car’s emissions were being tested and modified the amount of nitrogen oxide exhausted. When not being tested, the car emits up to 40 times the maximum amount of nitrogen oxide permitted, although the car seemed to have better fuel economy and better performance. The nitrogen oxide exhausted is a potential threat to the health of the citizens and the environment.1 The executives at Volkswagen are not sincerely acting in general social interest. To be socially responsible, they needed to have put more money towards designing and making cars that actually meet emission standards since social responsibility is acting for “a general social interest”.3

Although Volkswagen’s executives seemed to balance the interests of most stakeholders, they exploited the trust between them and their customers by deceiving them through false advertising and tried to bypass the laws on emission limits set by the government. The failure to fulfill their social responsibility led to the deterrence of customer motivation to buy their product, leading to the losses of the shareholders as their stock value significantly decreased.3 Volkswagen announced that their profit would drop significantly over the next year and many of their models will no longer be sold in North America.1 Volkswagen’s losses can be explained through the Stakeholders’ Theory, where a successful company needs to “create value” for its stakeholders.2 In Volkswagen’s case there was an imbalance of value generally between the shareholders and the community – more of the value was created for the shareholders.

The company stated it would put aside $7.3 billion to make the cars satisfy the pollution standards, and were willing to work with officials to investigate deeper into the programming of the vehicles. CEO, Martin Winterkorn was pressured to take responsibility and to resign.1 Though the executives at Volkswagen did make a serious mistake, they are not entirely socially irresponsible as they have made steps towards correcting their error.

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References

1 Ewing, Jack. “Volkswagen Says 11 Million Cars Worldwide Are Affected in Diesel Deception.” The New York Times, 22 Sept. 2015, www.nytimes.com/2015/09/23/business/international/volkswagen-diesel-car-scandal.html.

2 “What is Stakeholder Theory? – R. Edward Freeman.” Youtube, 1 Oct. 2009, www.youtube.com/embed/bIRUaLcvPe8. Accessed 11 Sept. 2016.

3 Zimmerli, Walther C., et al. Corporate Ethics and Corporate Governance. Springer, 2007. ProQuest ebrary, site.ebrary.com/lib/ubc/detail.action?docID=10187339. Accessed 11 Sept. 2016.

Image Source

“Car Brand Photo: Shiny Volkswagen Logo.” School Photo Project, Visually Delicious, 2016, www.schoolphotoproject.com/cars-motorbikes/volkswagen-logo-photo2.html. Accessed 11 Sept. 2016.

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