Monthly Archives: November 2014

“If the United Nations was fully funded why would we need the Arc or social enterprise”?

If the United Nations was fully funded, there would still be a need for the Arc Initiative or social enterprise because of the difference between large-scale and small-scale operations. The UN represents the majority of the world, therefore their initiatives would embody a large segment of the population. If they were to participate and fund small businesses, many of the country members would question as to why the funds are not being invested in large-scale operations that can benefit the majority. As a result, the door opens for the Arc Initiative. These types of programs create shared value for both parties involved: the programs gain experience and the businesses being helped gain unique solutions in an attempt to become more efficient. The types of businesses that the Arc Initiative takes on are ones that also create shared value within the community, whether it’s employing workers or producing quality products. Similarly, social enterprise’s create profits while producing a good or service that benefits a disadvantaged segment of the population. The United Nations is too large to be able to take on small-scale businesses as such. Nonetheless, it isn’t a bad thing as it opens up opportunities for students to gain experience and provide business knowledge in order to contribute to a good cause.

Sources:

UBC Sauder, “Arc Initiative“

Taking it back to 2004 in the hockey equipment industry: Reebok acquired the brand CCM. The takeover came at a time when CCM was losing its customers to other established brands such as Reebok and Bauer. Rather than integrating the two brands into one product, Reebok chose to keep the brands separate and create products under both lines of hockey equipment. This strategy proved to be profitable for the company in the first few years. Unfortunately, in recent years, both lines of equipment have decreased in customer popularity due to the emergence of Bauer as a leading brand in the sport of hockey. As I have worked at a hockey retailer for just over a year, I have had the privilege of first-hand experience on the general vibe around each brand of product and the hype is always revolving around Bauer. When the Reebok-CCM product reps come into the store to show staff the new product, the description of the product is always in relation to what Bauer currently provides to the market: “Our new CCM Tack skate fits similar to Bauer’s MX3 skate; Our CCM Tack stick has a similar kickpoint to Bauer’s MX3 stick”. In contrast, when Bauer product reps come into the store, they simply describe their product and the improvements they are bringing to the market. Reebok-CCM has made attempts to differentiate itself by producing top of the line equipment at a lower price point than competitors such as Bauer. Again, consumers realize the far better technology infused into Bauer’s equipment and are willing to spend the extra money for it. Most recently, Reebok-CCM has begun to discontinue the line of Reebok. More specifically, the company has taken the Reebok Ribcor stick and re-introduced it to the market as the CCM Ribcor. The stick still has the exact same design as before with a few improvements and the brand name CCM painted on the stick. Reebok-CCM can’t expect to gain market share by sustaining innovation. The company needs to create a disruptive innovation in order to compete with top brands like Bauer. It’s unfortunate that a prior leading brand, Reebok, has been forced to discontinue its original brand from a loss of focus due to the acquisition of CCM. The competition of brands within a company itself isn’t sufficient, especially in the hockey industry.

Bauer Sponsor – Alex Ovechkin | Washington Capitals

CCM Sponsor – John Tavares | New York Islanders

Sources:

CBC News, “Reebok to buy CCM“, CBC News, April 8th/04

Although Audi does not have one distinct feature that its cars are known for, I believe that it is profitable and works well for the company based on its current competitors. As described in Paola Lopez’s blog, I do agree with her in the sense that some consumers will see the Audi brand being convenient as an all-in-one vehicle, and some consumers will not see an attractive brand because of the lack of one distinct, exceptional feature. With that being said, I disagree with Paola on her comment that “it can work really good or really bad” for Audi. I don’t believe Audi was making a gamble when they established their business model; i.e. this will work very well or this won’t work at all. Similar to any industry, there are companies that some consumers will refuse to purchase from. Audi has proven that it is possible to remain in competition with its top quality competitors by producing a vehicle that meets multiple consumer wants and needs. Personally, I have always had an attraction to the Audi brand over brands such as Mercedes-Benz. I was not aware of the detailed features of each vehicle; I simply preferred the look.

Audi has established itself as a well-rounded auto company. Is there any other way? If they were to produce vehicles at a lower price point, they would face competition from Toyota, Chevrolet, Ford, etc. For this reason, Audi has a sustained position in the auto industry as a well-rounded vehicle that still maintains the high-performance sport features that many consumers are willing to invest their money.

Sources: Paola Lopez, “Audi’s personal ladder,” UBC Blogs, Oct. 1st/14

I found the lecture conducted by Danielle van Jaarsveld on the concepts of organizational culture and human resources management very interesting. This is partly due to the fact that I have bought my shoes through Zappos for the past few years and was not aware of the operations fuelling the business. I was very intrigued by the customer service and general culture revolving around the company. For this reason, I have chosen to do a business model canvas to outline Zappos’ structure in what makes the company successful:

Key Partners: Founder – Nick Swinmurn, CEO – Tony Hsieh, the “No Title/Do Everything” – Fred Mossler.

Key Activities: Customer Service, Selling of Clothing/Shoes, Social Media/Website Platforms.

Key Resources: Employees for Customer Service/Production, Investors.

Value Propositions: Culture, Clothing, Customer Service, and Community (the 4 C’s). Company Slogan: “Powered By Service”.

Customer Segment: Mass Market (all ages, different price points).

Customer Relationships: Self-Service: ordering through the website / Personal Assistance: one-on-one customer service over the phone / VIP program / free shipping / 365-day return policy.

Customer Channels: Online Sales on Website, “Word of Mouth” marketing, Quality Customer Service (to keep consumers coming back). 

Cost Structure: Fixed-Costs: employee salaries, machines, administration / Variable Costs: employee wages, variable overhead.

Revenue Stream: Sale of products through the website.

Sources:

Zappos Website – zappos.com

Alexandra Jacobs, “Happy Feet,” The New Yorker, Sept. 14th/09