Microsoft Performance Evaluations: Can They Be Fixed?

Posted on November 18, 2010 by meganbernard

Most reward systems are dysfunctional, especially if the organizational structure in the company is weak (meaning no one has power or status). If you have a dysfunctional reward system, then employees have little motivation meaning reduced effort and/or leaving the company.

A company that is a perfect example of this is Microsoft. “Microsoft Corp. has over 60,000 employees, and like [most] large corporations, it uses a performance review process to rate them”, however this ranking system “uses a bell-curve model to decide who gets high scores and who takes the low ones”. As well, “where you get ranked depends almost entirely on who your lead is, how hard they fight” according to Internal Microsoft documents obtained by WashTech News and the Mini-Microsoft Blog.

This instills a very competitive environment, where engineers will not produce as high quality work then if they had worked together. It also creates a workplace based on politics, as opposed to the quality of your ideas/work. With Microsoft competing heavily with Google and Yahoo, it will need its employees loyalty in order to keep up to its high profitability. Therefore, they will need to rethink their structure of rewarding employees to keep them and succeed.

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Lululemon Athletica: An Entrepreneurial Giant

Posted on November 15, 2010 by meganbernard

Dennis Wilson founded Lululemon Athletica in 1998 and it has become an entrepreneurial giant.

Lululemon is an entrepreneurial business because of 4 main reasons:

  1. Amount of wealth creation: Lululemon, as of 2010-08-01, currently makes over 80.30 million dollars in profit. In order to be a successful entrepreneurial venture, the company must create “substantial wealth, typically in excess of several million dollars of profit” and Lululemon clearly satisfies this criteria.
  2. Speed of wealth creation: An entrepreneurial venture also creates millions in dollars of profit quickly, in which Lululemon has done.
  3. Risk: In the clothing industry, there are only 4 major companies that control 2% of the market share in women’s fashions (Source: Microeconomics by Robert Gateman). Therefore, there is a lot of competition and if prices and/or quality are inadequate the seller will earn no profits.
  4. Innovation: Although his product had already been developed, Wilson used new production methods in order to differentiate his product from others. He created “technical athletic fabrics” as opposed to the cotton fabrics used in previous yoga wear. Lululemon clothes can also be designed by the individual consumer then made by hand in Lululemon Labs, like the one at 511 West Broadway.

The inside of the store on Broadway.

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The New Brand Image of Sierra Mist Natural (PepsiCo.)

Posted on October 9, 2010 by meganbernard

PepsiCo Inc. is planning on giving out over 10 million cans of Sierra Mist Natural in Wal-Mart stores this weekend. They plan on doing this to reintroduce their Sierra Mist product, which was received negatively.

Sierra Mist is now made with sugar instead of high fructose corn-syrup. PepsiCo also added the word “natural” in order to promote the fact that it now contains no artificial ingredients. They also launched a marketing campaign “spending what it normally spends in a year to market the brand in the last quarter” The Associated Press said.

The reason for this shift of high fructose corn-syrup to sugar is because the public believes it causes obesity (unproven). This caused a slump in soft drink sales and producers are asking if they can refer “to the sweetener as “corn sugar” to change perceptions”.

PepsiCo was wise to revamp its image (especially because it owns its bottlers) because Sierra Mist is a multi billion dollar brand name and they can now grab an unoccupied position in a major segment (“natural” pop). As well, these new tactics of changing the image of Sierra Mist will help PepsiCo in its long term strategy of targeting those who don’t drink pop.

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Finance and the HST (in British Columbia)

Posted on October 3, 2010 by meganbernard

The harmonized sales tax (HST) was implemented on July 1st, 2010. It was implemented by Finance Minister Colin Hansen and was said to make “BC businesses more competitive, encourage new investment, [and] improve productivity… Most importantly, harmonization will generate economic growth and, over time, create jobs and generate more revenue”. Basically, the Finance Minister took the investors money (consumers) in order to finance his organization (the BC government).

In return for being taxed 12% on everything besides milk and vegetables, a small $230 refund a year is given to moderate to low income consumers. Yet, “a $2,000 used car alone will ding you for $100 in additional taxes… Haircuts, fast food, computer repairs, parking, school supplies, and campgrounds – add 7%…[and] funerals – 7% more-just in case you thought you could escape the HST by dying.”.


Gordon Campbell Voodoo Doll

Premier Gordon Campbell is “asking British Columbians to think like a finance minister when they vote on the harmonized sales tax next fall [09/24/2011], focusing on whether the HST is good policy, even if it hasn’t been good politics”. Campbell says “he’ll do away with the HST if more than 50 per cent of the ballots cast are against the tax. However that threshold would not be legally binding on government“.

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Urgency/Importance Quadrant for Starbucks

Posted on September 28, 2010 by meganbernard
Starbucks Company

Low Urgency/ Low Importance

  • Increase dividend yield from 1% to 2% which is the more typical yield in the food industry sector
  • Increase size of or seating in store since many are over packed and customers cannot enjoy the comfortable experience of Starbucks and thus are more likely to go to McDonalds for cheaper coffee
 Low Urgency/ High Importance

  • Create a new marketing campaign in Canada-Starbucks mostly goes on word of mouth alone. Television advertisements about new products could introduce higher traffic and sales into their stores.
  • Last major marketing campaign was for the Starbucks Double Shot Espresso done in 2006:
High Urgency/ Low Importance

  • Competition from McDonalds cheaper prices
 High Urgency/ High Importance

  • Market more Arabic bean coffees since price is said to drop and other coffee beans are hitting a record high
  • “The speculative premium on Arabica should decline in the fourth quarter, as the upcoming harvests in Colombia and Central America should reduce current supply bottlenecks in high-quality Arabica beans,” said Carsten Fritsch, an analyst at Commerzbank AG
  • “Over the last six months, [there has been] a highly speculative green coffee market and dramatically increased commodity costs” said Starbucks president Howard Schultz

Short, Tall, Grande, Venti
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Brand Strength: Lululemon Athletica Inc.

Posted on September 27, 2010 by meganbernard

The Vancouver giant Lululemon Athletica Inc. (created by Dennis Wilson) has continued to surpass expectations of how it will do in specialized field in the retail industry. Friday September 10th Lululemon showed “a more than doubling of profit on a sharp jump in revenue”, that sent their shares soaring (up 13 percent to close at $41.89).

This sales improvement was due to increased traffic into their stores coupled with higher prices. “Lululemon Athletica’s impressive second-quarter results affirm our thesis that the firm’s strong brand image, quality merchandise and grassroots marketing strategy will attract a loyal customer base despite an uncertain economy” said CEO Christine Day. The increased traffic is due to Lululemon’s “aggressive” growth plan through e-commerce, new stores, and showrooms.

The Lululemon brand is so strong because of the marketing of its brand and because it was first in the specialized yoga market. It started off by marketing its clothes as high quality. Once that was established in the consumers head they moved to the image of well-being, offering such perks as free yoga classes. These aspects started off as points of parity but have now become points of difference as more and more people experience the Lululemon brand.

"Guide" to well being

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BP’s Gulf Oil Spill: Ethics Washed Away

Posted on September 15, 2010 by meganbernard

The BP oil spill was the major environmental, political, and economic disaster of the year. The spill occurred on April 20, 2010 when “methane gas from the well, under high pressure, shot all the way up and out of the drill column, expanded onto the platform, and then ignited and exploded”.  The oil spill resulted in 11 worker deaths, environmental problems that are still being measured as more oil washes up on shore and most importantly, economic disaster for Gulf of Mexico businesses that depend on the ocean to maintain their tourism/production level.

The ethics concern involving BP was that they never took responsibility for the damages that ensued. They played the blame game. BP’s C.E.O., Tony Hayward, has said that; “This was not our accident.” He has pointed to Transocean, the rig owner, and Halliburton, the company that constructed the concrete encasement that sealed the well, as the true companies responsible for the damage (BP CEO Says Oil Spill Isn’t Their Fault video). While it would see like good legal sense to try and shift the blame off themselves, BP should have been focusing on public relations in order to maintain its reputation with consumers.

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