Nicola Lam's Blog

As we near the end of COMM101, and the date to the Group Business plan 2 presentation approaches, I couldn’t help but notice an article in the Vancouver Sun on a mother from Burnaby who had started her own tutoring company, Academic Advantage. My group’s business plan had also been a local tutoring service and this article sparked quite an interest with me.

Susan Cumberland of Academic Advantage

As I first read the article, I couldn’t help but asses her initial steps when launching her business. Her business operates without service contracts, meaning that the parents of her clients pay the teachers $50, and they later give her $10. This plan seem quite flawed to me initially, and I found it quite hard to believe that her current business has 500 teachers on its roster.

As I continued to read, I discovered that Cumberland had enrolled herself in a business program at Douglas College as well as hired many consultant and advisors to help her with starting business. This initiative that she took helped turn her dream of a tutoring service and turned it into a functional business. The current business plan I am evaluating, Stuart Tutoring, is quite similar to Cumberland original vision but lacks much of the financial projections and does not have a solid and defined marketing plan. After hiring a consultant, Cumberland was able to get back on track and catch up with her accounting, which my business plan company should have taken into account.

An article on music caught my attention as I was reading the Vancouver Sun, and it reminded me of a fellow classmate’s blog that I had read. The article in the Vancouver Sun was addressing Christmas shopping, and if purchasing CDs as gifts had become obsolete. This transitioning into our world’s increasingly digital age, reminded me of Sienna Richardson-Isberg’s Blog in which she discussed Starbucks new mobile phone app which allowed customers to pay by their phones which is linked to their Starbucks account.

Now thinking back to the transition from CDs to digital music, I agree with Sienna and think that if other companies adopt this technology then our society will be able to drift away from the use of credit and cash.This application has the convenience of one essentially only needing to carry their phone and has the possibility of becoming the new way we exchange currency. Despite the convenience, there are several flaws that prevent this technology from replacing cash. Smart phones and iPhones are quite expensive and though are popular, are not universal.

Iphone starbucks app | starbucks.com

This application reminded me about Class 8 on IT, and how innovating with apps can be a wise strategy for a company. The convenience of Starbucks app will give them a competitive edge against other coffee shops and fast food restaurans.

In 2009, Olympus Corp. sold a profitable diagnostic unit in hopes to conceal decades of losses in order to shore up balance sheets. The Japanese camera company has spent over $1.3 billion in deals that had to do very little with their business, such as face cream, plastic cookware and recycling companies. Doing this wrote off 76% of their value within only one year.

President of Olympus, Shuichi Takayama, at a press conference

On November 8th, the company revealed that these purchases were made in order to hide losses that date back to the 1990s.

As discussed in class 3, on ethics and decision making, the three men involved with the scandal had “inherited” these values from previous managers of hiding losses. This shows, that if unethical methods are practiced in companies, then employees learn from these methods and use them later on in the future.

Companies in the future  can learn from this scandal, and weigh out the benefits of making unethical decisions. Olympus shares fell 29% on November the 8th, the day that the scandal was announced and have continued to fall. Were their choices really worth it?

GM's Anti-Cycling Ad

After GM released its anti-cycling ad, it was forced to pull the ad after it received negative press.The premise of their ad was to target cyclers, and persuade them that driving was “sexier” than biking. As Tianna referred to in her blog, cycling is affordable option while a “car pollutes 200 grams of hydro carbon per kilometre”. Enviromentalist, David Suzuki, commented on GM’s ad that discourages sustainability and stated in fact that those who bike and are actively fit are “hot[ter]” than those who are “lazy” and drive. The blog states that the ad was beneficial towards cycling and in fact promoted it as opposed being a detriment.

GM's Apology on Twitter

Because the ad received such negative press with college students and amongst the internet, GM decided to pull the ad as revealed on their twitter.

As discussed in Class 15 on CSR and Sustainability, sustainability plays an integral role in a company. If a company does not show an awareness for sustainability it has a negative effect on it’s market. The response generated from this ad shows the importance of sustainability in our society, especially amongst the younger generations. Because of this, the company should highlight its eco-friendly aspects and use this to their advantage instead.

Facebook's Mark Zuckerberg | http://www.telegraph.co.uk/

The ever popular social networking site first launched in 2004, Facebook, can be found open on almost every teenagers computer. Its founder, Mark Zuckerburg, who created the social-networking site from within his Harvard dorm room is a prime example of an young entrepreneur  who has displayed a high amount of innovation, risk, and accumulated wealth within a short period.

Innovation
Prior to Facebook, online social networking consisted of instant messaging, emailing, and Myspace. Facebook has successfully integrated all three of those concepts into one website appealing to a wide age range and has changed the way we connect with one another.

Risk
To this day, Facebook deals with many legal controversies. Many criticize its issues concerning online privacy, child safety, and censorship. Despite these criticism and lawsuits, Facebook has continued to prosper and has not lost its popularity.

Accumulated Wealth/Speed of Wealth

Over the past 5 years, Facebook revenue has grown to $4.2 billion which is over 800% its original revenue in 2006. Over this short period of time, the company was able to accumulate a large amount of wealth which a sign of entrepreneurship. Facebook’s revenue has been generated through advertising.

Capitalism – many say it’s what allows our country to thrive. Others place society’s problems on capitalism and blame it on the corporate world. The Occupy Wall Street is a group of activist who are against corporate greed, social inequality and any other divisions between the rich and poor. The group first began on September 17, 2011 in New York’s financial district. They describe themselves a diverse resistance movement with no leader.

Though these protests first began in New York, similar demonstrations have taken place across the U.S including Los angeles, San Francisco, Chicago and Boston. This motion has even spread to Canada, planned to take place on October 15th 2011 in Vancouver at the Vancouver Art Gallery.

Occupy Vancouver |www.globaltvbc.com

The members of this group believe that they are the majority and the banks and corporate industry make up the other small percent.

“1 percent of the people have 99 percent of the money.”- A member of the Occupy Wall Street

The protesters had hoped to reach the magnitude of other protests this year such as in Egypt and Israel. Some compare the the protests to protests during the Vietnam War.

It may quite possibly be because I am a business student, I find that the protesters are quite irrational and unrealistic. In an during the CTV 11 o’clock news on October 8, 2011, Farshad Azadain, an organizer, claimed at 4:50 that the organization wanted things such as “free post-secondary education”. In theory, this would be ideal, but what they do not realize is that the money to this would come from higher taxes – something that they had hoped to get rid of. I find these protests preposterous, with little evidence or concrete goals that they would like to achieve.

Works Cited

http://topics.nytimes.com/top/reference/timestopics/organizations/o/occupy_wall_street/index.html?inline=nyt-org

Microsoft, the multinational computing corporation is considering rebidding for the web portal and search engine Yahoo!. In 2008, Microsoft offered a bid of $44.6 billion but was unsuccessful in acquiring the company. Yahoo felt that the bid had greatly undervalued its company. 3 years later, Microsoft is seeking to pursue Yahoo again though the decision has not yet been finalized.

The speculation of Microsoft’s bid cause Yahoo’s shares to jump 10.1% to $15.92 on NASDAQ. Microsoft shares increased 2.2% at $25.89.

With Microsoft currently owning the Bing Internet search engine and the MSN web portal, owning Yahoo would give it over 30% of the US search market. This would allow it to be a significant competitor to Google.

With Google currently holding the greatest power in the search engine market, it would be ideal for Microsoft to take this opportunity to become a powerful competitor. Though Google is most well known for its search engine, it is also known for Gmail and Youtube. If Microsoft were to buy Yahoo, they would control Yahoo mail, as well as Hotmail. This would be sure to knock out smaller competitors such as AOL, and leave Microsoft and Google as the main web-email service.

Blog Schumpeter, from the economists, commented on the company’s alliance with Microsoft and AOL on November 8th to “bolster its fortunes”. It also says Yahoos assets come not only from its search engine, but its email service and Japan sector. Its current deal with Microsoft and AOL allow it to “tout” each other’s unsold display ads.

http://www.economist.com/blogs/schumpeter/2011/11/yahoo

http://in.reuters.com/article/2011/10/06/idINIndia-59733520111006

RIM Stock - Oct 3 2011 - October 7 2011 | http://finance.yahoo.com/q/bc?s=RIMM&t=5d&l=on&z=l&q=l&c=

Research In Motion Ltd., most well known for the Blackberry, made its greatest advance in 2.5 years on October 5th, 2011. Rising 12%, or $2.6o, on the NASDAQ Stock Market was RIM’s greatest one-day gain in the past 2 years. This year RIM suffered a great loss being down 59% this year alone. The 8% gain in this week alone have led to suspicions of a takeover.

Vodaphone Group Plc, the UK based telecommunications company, has been speculated to be one of the possible aggressors. Speculations followed Googles purchase of Motorola Mobility on October 3rd.

Though these speculations are mere rumours, there are many potential bidders. Microsoft would find the acquisition of RIM beneficial, though they currently have the Windows 7 phone.There is also a possibility that smartphone competitors such as Samsung or HTC may be potential buyers. Now that Google has ventured in to the mobile services, it also may benefit from the purchase of RIM.

Though it may not be RIM’s first choice to sell, considering their failure with the Blackberry Playbook and lost of customer loyalty, it may in their best interest to consider this option.

The Blackberry Playbook shipped 200,000 units in the last quarter, which is a measly number compared to the 200,000 iPads sold every 2 days.

Works Cited

http://blogs.vancouversun.com/2011/08/17/blackberry-in-motion-after-google-deal/

http://www.vancouversun.com/business/BlackBerry+maker+left+Land+following+Google+Motorola+acquisition/5262001/story.html

Steven Jobs, the chairman of Apple and past CEO, passed away on October 5th, 2011 after struggling with pancreatic cancer. Many worried after Steve Jobs resignment in August 2011 that Apple would struggle to maintain Jobs’ innovative designs and concepts. This was reinforced after the October 2011 keynote presentation, and new CEO Tim Cook was unable to present forth any new innovating products nor a new iPhone4. Following the presentations, shares for Apple dropped $20.

Many wonder if Apple will be able to succeed after the loss of Steve Jobs. With many competitors releasing similar products there has been an increased pressure on Apple and Tim Cook. What separates Apple from other company is their innovation and monopoly over the portable music device industry. If they are unable to produce a revolutionary product soon, Apple will face trouble. Amazon recently released their tablet the Kindle Fire, which at less than half of the lowest iPad model, will be the newest affordable multimedia device – costing the same as an 8GB iPod Touch.

The Amazon Kindle Fire | http://www.amazon.com

There is no doubt that Steve Jobs revolutionized the way that technology affected our daily lives. Despite Apple’s current succes, there is no guarantee that the company will continue to thrive without Job’s guidance.

Works Cited

http://curiouscapitalist.blogs.time.com/2011/10/06/steve-jobs-the-businessman-can-apple-thrive-without-him/

Wal-Mart, the widely popular warehouse store has prepared to initiate a new program with the goal of supporting women-owned businesses and workers.

A Wal-Mart store

They have launched this program in order to counter possible claims of sex discrimination after having dealt with a class-action suited filed by female employees for unfair treatment this past summer. The company has stated that it plans to carry $20 billion in women-owned businesses products over the next 5 years. Currently, Wal-Mart only spends $2.5 billion, but they hope to double this figure by 2016.

This new program will help many women improve the quality of their lives as well as financially. With the resources Wal-Mart provides, these women will be properly educated and greatly benefit from this initiative.  Though the company will need to almost double spending in this area, this resolves their ethical dilemma of gender inequality. Had the company not chosen to invest in this costly program, then their company name would have been tarnished for mistreating their female employees. Wal-Mart may have also faced other lawsuits if they had not solved this ethical dilemma.