Month: November 2013

https://blogs.ubc.ca/qinyuanzhu/2013/11/16/business-is-going-well-eh/

Who doesn’t like a little extra cash? However, the question that would follow up on that would be, who would be generous enough to give that extra little cash? Evidently, the managers at Griffin Communications are, as they gave a $500 bonus to their employees as a token of gratitude for their hardwork in creating a one of the top television stations in Oklahoma, United States of America. This action confirms with corporate culture in how managers and the human resources department deal with performance management. In this case, one usually hands out bonuses in payment as an incentive to increase productivity or quality of service. However, incentives can be a double-edged sword that may potentially backfire on the managers, despite their motives that are positive in theory. For Griffin Communications, they offered a flat reward to all employees. While this does well to keep employees happy, the rewards create an imbalance between the work ethics presented by certain workers. To specify, comparatively harder-working employees are paid the same in incentives as their less productive counterparts. This will cause the idea that some employees need not to work as hard, and for some employees to continue to slack off as they have been previously rewarded for it. Overall, having a flat reward system that does not scale base on the level of productivity of the individual worker has its drawbacks.

http://www.vancouversun.com/business/General+Motors+recalls+Malibus+defrosters+wiring/9171233/story.html

One would assume that large, well-established business will have a handle on their operations and quality-control procedures; as it was because of their seemingly good products that the company have surged to business-stardom. However, once in a while, companies let slip a few errors in judgement that will affect their future profitability because any mistakes reflects poorly upon the corporation. Such a company that could not escape from not having a clean-record is General Motors; one of the major car manufacturers in North America. Recently, General Motors had to recall several thousands of their car line, Malibu, to fix faulty defrosters and wiring. This is important to note because this affects the overall safety of the vehicle for its occupants and drivers. With lives on the line, it was especially important and crucial for General Motors to manufacture cars of the utmost quality- quality that is assured from their operations. The aspect of operations within a business setting includes sourcing appropriate materials and the transformation of the product from the inputs. From the recall notice, one can assume that General Motors’ operations has not been as prudent as it could have been, resulting in thousands of Malibus to be sent back to the factories to be repaired. not only will this result in an increase in costs, but the reputation of General Motors has been negatively affected and so its potential revenue has decreased because consumers will possibly be more wary of purchasing from General Motors (like how it was for Toyota and their infamous recalls on their brakes).

http://www.bnn.ca/News/2013/11/14/IKEA-eyes-low-carbon-future-with-Alberta-wind-energy-project.aspx

With the growing hype from the public in wanting more environmentally-friendly products and business, the furniture-giant Ikea has responded by developing plans to harness the power of renewable energy resources. To continue their stance on renewable energy, Ikea plans to add wind power along with their already-existing solar powered panels to operate a certain percentage of their business. Not only will this lower costs in the long-run for Ikea, this will also reduce the size of the carbon-footprint left behind. Evidently, this reflects environmental sustainability- a subset of corporate social responsibility. By helping the environment,  Ikea is helping the world become a a little more green (and not to mention, their financial accounts will see a little more green as well). However, this will also help economically as well, because one can hope that companies will pass on the savings- or a portion of it- to the consumers to increase sales through lower prices. In other words, by becoming more environmentally-friendly, Ikea stands in a win-win situation: they save money, save the environment, and save the conscience of consumers concerned about the planet Earth.

http://www.bnn.ca/News/2013/11/15/Bill-Gates-wants-Norways-800B-oil-fund-to-spend-more-in-Africa-Asia.aspx

People generally listen to the words from those above them. Especially when the words are from a multi-billionaire tycoon, such as Bill Gates. Not only is Gates a successful businessman and entrepreneur, he is also a philanthropist, with his own charitable foundation to boot. However, with the amount of help required to aid developing countries in advancing their infrastructure, Gates attempts to raise awareness about this issue. In this case, Gates publicly proposes that the majority of Norway’s billion-dollar oil funds should be invested in impoverished areas with the potential to grow, such as countries in Africa and Asia. With Gates’ stance on charity, he fits in well with the definition of sustainability. The core aspects of sustainability includes social, environmental, and economic; all of which are affected by Gates’ philanthropy. To be specific, it has affected socially because the money will help elevate the living standards of the people; environmentally because local business and governments can have access to more efficient technology; and economically because the country will be able to a more active part in the international markets through exports and imports.

http://www.bnn.ca/News/2013/11/15/WestJet-going-trans-Atlantic-with-new-Dublin-flight.aspx

Known for its flights within North America, the airline company WestJet has recently announced its plans to expand and cross the ocean to a new destination: Dublin. This would be a first for WestJet for flights outside of their standard North American flights since the launch of the company. With the new direction the company appears to be going in (the expansion to more international flights), one could say that WestJet is potentially changing their business strategy. To specify, one of the methods listed out in Porter’s Generic Strategies includes a Focus Strategy for narrow market segments and product uniqueness.  Previously, this would be where WestJet fall under, as the company purposely focused on the North American sector for their airline business. However, with the inclusion of the proposed expansion of their offered flight services to other areas, such as European countries, WestJet’s previously narrow market segment will expand as well. This in return will cause for a new evaluation on WestJet’s  market strategy. To add on, this also affects the company’s brand positioning, as world markets for airlines will become more competitive due to the added services of a competitor. As a result, companies may have to try harder to vie for consumers as customers consciously decide on which airline they prefer on various aspects; such as price and available services.

http://www.bnn.ca/News/2013/11/13/Apple-under-investigation-in-Italy-for-alleged-tax-fraud-Report.aspx

According to the article, Apple’s financial accounts are going to be scrutinized by the Italian government when news reports surfaced about an alleged tax evasion in the said country. This is in due part to the now more-aggressive behavioural stance the Italian government and its banking system have taken when dealing with major international businesses; as many global corporations have often found ways to cut corners when it comes to paying taxes in their respective countries where they operate in. With that being said, this article touches upon Milton Friedman’s remarks on a company’s strategies and actions. In particular, Porter had stated that a company should try to maximize profits while staying within legal and cultural boundaries. In other words, the company should not have to resort to illegal activities in order to increase their amount in profits. In contrary to this, Apple has allegedly committed tax fraud in Italy, which leads to the inquiries of how much does Apple owe and where else has Apple committed fraud. Overall, this questions Apple’s business ethics and damages Apple’s reputation as a leading company in the technology field, as consumers may begin to wonder how trustworthy is the business in its dealings.