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The Allure of Inedible Vending Machine Contents

Back-to-school at UBC brought some surprises for those who’ve been off campus all summer: the opening of Fresh Slice in the Village, the construction at Totem, and the temporary (albeit, likely less temporary than predicted) closure of DLam. But the most exciting change, for me at least, came on a much smaller scale: the addition of a new vending machine dispensing various school supplies on the 3rd floor of Irving.

Why is it that as soon as any non-food product is placed in a vending machine, we are automatically intrigued?

If these same pencils, Post-Its, and paper were housed on their normal shelves in the corner store or Staples, we wouldn’t look twice. However, as soon as they are displayed in a glass box in a low-key location, our interest increases.

Although the product remains the same, the other three elements of the marketing mix for these school supplies changed quite a bit, demonstrating how there are multiple consumer opportunities and markets for companies to tap into:

Price –> Because those likely to purchase out of a library vending machine are doing so because of immediate need, they will be more willing to pay a higher price for the good in question.

Place –> Convenience is the name of the game in this marketing situation. Having the products so close at hand in a public, generally higher-traffic area will spur people to make purchases they would otherwise have to had planned ahead of time.

Promotion –> No promotion needed. Because of the limited array of choices in a vending machine, direct competition is reduced and the utility of the item, not the brand name, becomes more important.

 

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Green = The Colour of the Decade

We are the generation of exponential technology advancement, terrorism, zero privacy…..and the colour green. The sustainability movement has been gaining speed over the last few decades and, after having been helped along the way by a man named Al Gore, is now a mainstream movement. We have been educated about greenhouse gases, global warming and landfill capacity; however, it is difficult for the individual to know what their personal impact on the planet is. That is why the Carbon Footprint Calculator is such a valuable tool.

2.458 tonnes of co2/year


That is my carbon footprint. Compared to the national average of 9.1 tonnes, that is impressively low, and, I have to say, makes me quite proud of myself. However, upon inspection, it becomes clear that this very minimal footprint is due to my particular current situation, and will be nearly impossible for me to maintain as I age.

Carbon Footprint BreakdownBecause I currently do not have a car and nor do I travel internationally, both my daily commute and international travel are extremely low. However, this is not sustainable, as I will likely start driving a car and traveling more in coming years. The most interesting result was the fact that my diet accounts for the vast majority of my carbon footprint. In order to reduce this, I could look into eating more a more vegetable-based, locally-grown diet.

Tools like this fun, simple online calculator help to increase awareness of what small things can be done to aid in the sustainability movement. The world is going green, are you?

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Business News

Money for Nothing: The irony in corporate boards

Apart from being quite amusing, this interview with the satirical co-author John Gillespie of “Money for Nothing: How the Failure of Corporate Boards is Ruining American Business and Costing Us Trillions” opened my eyes to a major problem in business and the irony that huge, successful companies are still using the inefficient, controversial, and often un-businesslike corporate model which includes advisory boards.money_for_nothing.03

Also referred to as a “board of directors”, the corporate board is an assembly of elected or appointed individuals who oversee the activities of a specific company or organization. In for-profit companies, this board is responsible to the stakeholders, reviewing the broad policies of the company in order to ensure that it operates in the stakeholders’ best interest. The board is also responsible for appointing a chief executive (CEO) whom they believe will best run the company and adhere to its guiding principles.

In their book, John Gillespie and David Zweig slam the corporate board, portraying it as a farce. The fact that boards often include irresponsible individuals with no background in business displays an odd inconsistency in companies that built their fortunes and status on efficiency, commitment and hard-work. Organizational structures are in place to clarify responsibilities, provide a pathway for communication and ultimately maximize efficiency and productivity. The board of directors is thus an ironic component to the organizational structure as this group of top individuals that oversee all corporate activities are often the most unprofessional.

However, when one considers the bigger picture, as Gillespie points out, its not actually that ironic. The board of directors is often appointed by the company CEO, who in turn is kept in office by the board of directors. See the pictures becoming clearer? These CEOs staff their boards with supporters in order to guarantee the continuance of their power and salary.

This structure is in obvious need of an overhaul.

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Business News

The Importance of Inter-Cultural Understanding

There are 195 countries on 7 continents covering a combined area of 148,940,000 square kilometers on our 3rd rock from the Sun. Although all 6,800,000,000 of us humans inhabit the same Earth, there are innumerable cultural differences that separate us. These cultural differences present barriers to communication which may spark misunderstandings, unintentional insults, or total incomprehension. Derek Sivers demonstrated the phenomenon of cultural differences in his quick speech at the TEDIndia2009 conference:

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Our tendency when confronted with unfamiliar views of the world is to reject these views and label them as false. In the case of the Japanese tourist, for example, the North American is likely to pass judgment on the Japanese man’s confusing inquiry, despite the question being completely legitimate for the Japanese man.This tendency for information to get lost in translation or misunderstood poses a significant problem for the business world especially.

When companies and executives from different continents and different cultures do business–and million-dollar deals are on the line–it is crucial that both parties understand each others’ point of view. This is where options and courses such as Sauder’s International Business Option come into play. This option requires students to study not only business, but the language and culture of a foreign country in order to be able to communicate effectively with executives of this country. This option is thus an important one to consider for any students thinking of working abroad.

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Business School

West Coast Case Competition

A few days ago two teammates and I participated in the preliminary round of the West Coast Case Competition. Put on by Sauder’s Consulting Club, this competition, in its first year, asks participating teams to act as consulting firms and develop large scale solutions to a particular company’s problems.

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The preliminary round case involved the well-known company Apple Inc. and asked teams to develop strategies that addressed Apple’s difficulties with dividing resources between new and old products, and also how they should develop and move forward with their unique retail strategy. The analysis of this case and the develop of our recommendations for this company required us to call upon all the knowledge we’ve amassed thus far in our education, including the big picture overviews we’ve received in Comm 486G of areas such as accounting, marketing, management information systems and supply chain management. Our team developed an approach that involved tapping into the market for company laptops by sending Apple outreach teams to targeted companies, changing the philosophy of Apple’s R&D department in order that they focus on one product at a time, and developing Apple’s feedback system.

Although our team did not advance to the final round, we gained valuable experience in case competition and consulting that most first year Sauder students do not get. I’m also looking forward to attending the final round as an onlooker in order to see the recommendations of more experienced teams and hopefully learn from them. This experience has peaked my interest in consulting as a possible career and its something that i would like to investigate further.

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Business News

Accounting Fraud: You can do it too!

Satyam

It seems, with the number of accounting frauds exposed in recent years, that company execs–such as Mr. Raju of Satyam Inc.–still believe that they can manipulate numbers on income statements and balance sheets to their advantage without being caught.

“Mr. Raju admitted that the September quarter accounts for last year included a non-existent cash and bank balances of Rs50.40bn ($1bn), non-existent accrued interest of Rs3.76bn and other irregularities.

In the September quarter alone, the operating margin was shown as 24% of revenue compared with an actual operating margin of 3%, due to inflated revenue and profit figures.” – FT.com

The fallout from the exposure of these falsified accounts has included a drop in Satyam’s stock price of 80% and the expectation that the company will go bankrupt. However, it is not these consequences that are interesting to me, its the fact that companies can and do get away with accounting fraud.

The fact that huge, well-respected international audit firms such as PriceWaterhouseCoopers, who audited Satyam for years, are able to overlook discrepancies in reported financial figures presents a huge problem. It is the job of these auditors to dig for background information on companies’ transactions in order to confirm what has been reported. There has been a  history in recent years of companies–such as Worldcom and Enron–falsifying the assets portion of their balance sheets and the expenses portion of their income statements and getting away with it. If these audit firms are not able to improve their investigative work, companies will continue capitalizing on the their incompetence.

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Business News

Valentine’s Business: Just make it pink!

No fancy new features, no million-dollar ad campaigns, no additional R&D. Just make it in pink.

pink cameras

This is the simple strategy used by numerous companies on the lover’s holiday, and it works. As you can see in this video by CNN, and as you’ve surely noticed yourselves, as soon as Valentine’s Day approaches each new, retailers don’t only change their store displays to red and pink themes, but also the products themselves. Flowers remain a staple gift on Valentine’s Day, as florists see a 450% increase in business, but as technology moves forward and gadgets continue to lessen in price, gift buyers are moving towards items such as cameras and cell phones.

Research and development departments of huge companies work tirelessly to try and develop the next coolest feature or product and to identify the alteration or addition to a product that will inspire people to buy. These companies pay their R&D departments to be innovative and find ways to entice buyers with items that seem to be on the cutting edge of cool, or the next new thing in technological advancement. However, as we can see by the example of consumer trends on Valentine’s Day, the solution isn’t always complex. Sometimes it’s as simple as a colour change.

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Business School

Midterm Recap: Lessons from Comm 486G

I registered for the pilot course Comm 486G with the hope that it would at least sate my continuous thirst for knowledge and new skills. And it has delivered. This course is unique in that it does not stress the memorization of specific facts, or the ability to apply formulas. Instead, it has taught me important broad business concepts and helped me build upon my foundation of analytic skills. What I have learned:


  1. That there are only 10 different numbers, but the can mean a million things; they combine to provide invaluable information for players in the business world.
  2. To cultivate and coax out my opinions and ideas; if i really think about it, I have an opinion about everything.
  3. To not fear having my ideas shut down; this fast-paced class rewards participation, not necessarily correct answers.
  4. To analyze; peel away the outer layers of information and infer conclusions from what is found.
  5. To look at the bigger picture; small details are often negligible when it comes to large-scale decision making.


The interactive nature of this course has allowed it to act as a sounding board for students’ ideas and the intensive environment has, for me at least, fostered an increased interest in, and pursuit of, all things business related. Although still in its infant stages, and thus with a few wrinkles that still need to be ironed out, this course is the most valuable university experience I have had to date.

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Business News

Branding: Don’t Fix it if it’s Not Broken

In the modern cut-throat market where competition is fierce and the risk of failing is very real, some large companies, even those with solid market dominance, are becoming hyper-vigilant. This means that teams are being hired to analyze and manage every aspect of these companies’ products. This is very likely beneficial in most situations, but these teams’ desire to be active and improve already strong, stable products could lead to bad business decisions, as with the redesign of Tropicana’s classic cartons in 2009.tropicana

In conjunction with an outside consulting firm, Tropicana spent $35 million on a new branding campaign which involved the design of a new carton for their juices which would put the class straw-in-orange design to rest. Despite the time, money and resources spent on this campaign, Tropicana was soon flooded with complaints from customers who wanted the straw design back, and Tropicana was soon forced to abandon the new design.

This business mistake provides a valuable lesson for my future endeavors in the business world. When I first enter the workforce fresh out of business school, I will likely be overeager to apply what I’ve learnt and make valuable contributions to the company for which I work. However, I must not forget the fundamental maxim: if it’s not broken don’t fix it.


New York Times: Tropicana Discovers Some Buyers Are Passionate About Packaging

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Business News

Entrepreneurial Ethics: When is it okay to squish the little guys?

Entrepreneurs keep their eyes peeled for any available entry point into a market, looking to capitalize on unexploited resources and opportunities, ready to spring into action as soon as they predict profitability. But where do ethics play in? When is it okay for larger companies, with more stability and resources to expand, to squeeze the life out of small businesses just trying to stay afloat?

Sightline bus

A case in point is that of the expansion of Oregon-based Sightline Tours into Vancouver. Already successful in the States, and armed with a fleet of flashy, sustainability-conscious buses, Sightline surged into the Vancouver sightseeing market in 2008 after the exit of one of the largest bus tour companies, Grey Line. This large shift in the industry, along with already flagging tourism, has led to the subsequent exit from the market of many smaller, often family owned and operated businesses. Even more small businesses are taking huge profit hits as Sightline now controls the industry at Vancouver’s cruise ports.

This strategic entrance and domination of the market by Sightline is no doubt intelligent and well-executed. But is it ethical? In our profit-obsessed world, entrepreneurs and executives are obsessed with exploiting all opportunities to earn a buck, but they often do so at the expense of the livelihood of many smaller businesses. By seizing large chunks of market demand, these growing companies cause numerous job losses and failed companies. Should entrepreneurs be required to adhere to an ethics code? Is our money-hungry world capable of such a thing? Questions for the future.

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