11/10/14

Blog Post #11: The Power of Social Enterprise


” If  the United Nations was fully funded why would we need the Arc or social enterprise?”
Social Enterprise Flow Chart Graphic

 “If money could have changed the world, money would have changed the world.” (Sharad Vivek Sagar) The reason social enterprise is so important for society is because, no matter what society believes, money cannot solve all the world’s problems. Should the United Nations achieve an infinite supply of money, it would never be enough because just blindly dishing out aid to people in need does nothing. Instead, helping people to (proverbially) stand up on their own two feet will have a much greater and longer lasting impact. And that is what social enterprise is; it is a way for a company to profit while also benefitting the community and citizens around them. It has become commonplace for corporations to view social work as a cost, something that they must subtract from theirMuhammad-Yunus-800x440 bottom line. But social enterprise is a way of both bringing in profits and helping propel the world. Muhammad Yunus (pictured right), through his company Grameen Bank, gives people loans so that they can create their own businesses, a micro-financier in the purest sense. With only a small loan, he brought a world of change to thousands of people, and, in the process, made a profit. Had the UN been in this scenario, they would have probably only delayed the issue through their delivery of different types of aid. The UN would not have given these people the tools they need to survive and prosper on their own, instead just giving them the necessities for them to survive in the short-term. In its truest form, the difference between the UN and a social entrepreneur is that “…social entrepreneurs are not content just to give a fish or teach how to fish. They will not rest until they have revolutionized the fishing industry.” (Bill Drayton)


“Social Entrepreneurs: Pioneering Social Change.” YouTube. Skoll World Forum, 18 Feb. 2009. Web. 10 Nov. 2014.

11/10/14

Changing of the Guard in Europe

airliner-taxi-US-460x250Debrief

European companies are feeling the pressure from new discount competitors, whose business models utilize advances in technology to provide cheaper, more efficient products. According to the Globe and Mail article, this is most prevalent in the airline industry, where companies – Ryanair and easyJet for routes within Europe, WestJet and Southwest for those in North America – are quickly eroding the market power of the “high-cost, debt-ridden” incumbents, such as British Airways.

My Opinion

Honestly, I am not surprised by this turn of events in the European markets as they reflect the evolution and modernization of society. A parallel Clayton images (4)
Christensen’s theory of “Disruptive Innovation“, British Airways (BA) has established itself as a leader in its industry. Created in 1974, BA was among the first into the commercial airline industry in Europe, a relatively new and innovative concept at that time.  Because of their market power, BA did not feel the need to innovate and sustain their advantage. This was characterized by their decision to not integrate the growing desire for lower cost fares into their business model, instead keeping fares above the industry equilibrium so as to maximize profits. This laziness allowed lower-cost companies, such as Ryanair and WestJet, to come in and displace the established firm, providing a cheaper alternative to the expensive BA. Ryanair and other’s _46682311_ba_profits_466lower fares are a direct result of having lower maintenance and overhead costs for their airplanes by way of innovation. This allowed the airline industry to be available to a greater number of people, perfectly illustrating Christensen’s timeline of a disruptive innovation. After all this, I am not at all surprised that Europe’s traditional powerhouses are slowly fading away into non-existence. All these years, instead of trying to sustain their innovation, they fed off their innovation’s market power. Now, their sins are catching up to them, and, as told by Mr. Christensen, the process of disruptive innovation is running its natural course.


Reguly, Eric. “European Businesses Feeling the Pinch from Discount Competitors.” The Globe and Mail. The Globe and Mail, 9 Nov. 2014. Web. 10 Nov. 2014.

Disruptive Innovation Explained. Perf. Clayton Christensen. Harvard Business Review, 2012. Youtube.

Babbage, Joanne. “British Airways’ Rapid Descent.” BBC News. BBC, 11 Sept. 2009. Web. 10 Nov. 2014.

Digital image. Eco News RSS. Eco News, 14 May 2013. Web. 10 Nov. 2014.

Ryanair Logo. Digital image. Amazigh TV. Amazigh TV, 10 Oct. 2014. Web. 10 Nov. 2014.

British Airlines Profits/Losses. Digital image. BBC Co. United Kingdom. BBC News, 9 Nov. 2009. Web. 10 Nov. 2014.

 

11/10/14

Canada’s Sustainability Issue

web-gas-0520Debrief

According to an article in the Globe and Mail, Canadian companies are consistently lagging behind other firms in reporting sustainability data to their images (5)respective stock exchange. According to a study done by Corporate Knights Capital, for companies with at least $2 billion of market value, firms trading on the TSX are near dead last, finishing behind those on the NYSE, Helsinki stock exchange, and even the lowly-regarded Moscow stock exchange. The report looked at a firm’s quality of reporting on energy use, carbon emissions, waste generation, water use, employee injury rates, employee turnover, and total payroll costs.

My Opinion

This study immediately strikes me as a reflection of Canada’s failure to adapt to innovations in the workplace. By their hesitance to report their sustainability information, my mind directly assumes that these companies are trying to hide the fact that they are lagging behind the worldwide norm in these areas. That being said, I do believe I know a way these companies could improve their standings. As shown by the Harvard Business Screen Shot 2014-11-10 at 5.27.03 PMSchool article “Who is the Chief Sustainability Officer“, these sustainability metrics could be bettered if assigned to a Chief Sustainability Officer (CSO). The first role of a CSO would be to promote and implement greener practices (compliance), improving the company’s standing in all the categories that focus on environmental sustainability . The second stage of a CSO’s role would be to improve efficiency in the workplace, which would directly lead to lower payroll costs and employee turnover. Lastly, the CSO would be assigned to work towards innovation, which will undoubtedly improve all ESGareas of the studies’ metrics. Although a relatively new position, companies all over the US and the world have incorporated a CSO into the C-Suite because it not only enhances the company’s image, but it lowers operating costs and increases profits. This, in its truest form, showcases a trend towards increasing shared value. It is a farce that Canada, a country lauded for being so environmental conscious, should have its major corporations act in such a way. In my eyes, Canadian companies should be at the forefront of sustainability, not stumbling at the back. Luckily, I believe that by implementing a CSO, Canadian companies will not lag behind in reporting their sustainability data, but be eager to show their highly sustainable practices.


McFarland, Janet. “Canadian Firms Lag Global Peers in Reporting Sustainability Data.” The Globe and Mail. The Globe and Mail, 14 Oct. 2014. Web. 10 Nov. 2014.

Gerdeman, Dina. “Who Is the Chief Sustainability Officer?” The Harvard Business Review. Harvard Business Review, 8 Oct. 2014. Web. 10 Nov. 2014.

Heaps, Todd A.A. Canadian Sustainability Reports. Digital image.Corporate Knights Capital. Corporate Knights Capital, n.d. Web. 10 Nov. 2014.

TSX’s Sustainability Program. Digital image. Exchange: The Official TSX Blog. Toronto Stock Exchange, 16 June 2014. Web. 10 Nov. 2014.

Canada’s sustainability issue. Digital image. The Globe and Mail. The Globe and Mail, 14 Oct. 2014. Web. 10 Nov. 2014.

11/5/14

Crossing the Line? A Response to John Whaley’s Blog Post

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Debrief

In John Whaley’s blog post “Jack Astor’s New Sexist Ad Proves They Really Are Asses“, John argues that, although derogatory, Jack Astor’s new marketing n-JACK-ASTORS-largeslogans aligns with the company’s image. His argument contradicts the opinions of blogger Toula Dimonis, who believes that this does not provide a friendly environment for women. John’s argument is that these advertisements, even though they demean and alienate women, ultimately add to the advancement of the brand, as women are not the company’s target audience.

My Opinions

First and foremost, I believe it necessary to state that these slogans truly do reinforce the inequality between genders in our society. That being said, I do agree with John in his argument that this marketing campaign, although crude, furthers the brand. A typical bar and grill, Jack Astor’s point of parity is quite static to the hundreds of other bars in each city. However, Jack Astor’s has differentiated itself as a male-dominated bar that personifies ‘manly’ institutions, Jack_Astor_s_Bar__and__Grill-logo-2EE1B56EB3-seeklogo.com_such as sports and beautiful women. Similar to Hooter’s, the company’s value proposition is geared towards creating a enjoyable environment for men, not women. So although Toula Dimonis would “never go to Jack Astor’s on a girl’s night out,” it doesn’t matter, because women are not who the value proposition is geared towards. The point of differentiation is meant to appeal to the thousands of men who, after enduring a hard day at work, need to choose a bar that will best alleviate the day’s stress. And, having best differentiated their brand around the stereotypes of men, Jack Astor’s is where these men will go. In my eyes, John is completely right in believing Jack Astor’s is justified in this marketing campaign. I do believe this help propels the brand and appeals to their target audience. The only problem is, why do they have to completely alienate and demean half of society?


Whaley, John. “Jack Astor’s New Sexist Ad Proves They Really Are Asses.” Review. Web log post. John Whaleys Blog. John Whaley, 4 Nov. 2014. Web. 05 Nov. 2014.

Weblog post. The Huffington Post. Toula Drimonis, 3 July 2014. Web. 05 Nov. 2014.

Jack Astor’s Logo. Digital image. Smart Canuck. Jack Astor’s, n.d. Web.

Digital image. Bloor-Yorkville. Jack Astor’s, n.d. Web.

Jack Astor’s New Sexist Ad Proves They Really Are Asses. Digital image.The Huffington Post. Jack Astor’s, n.d. Web.

11/1/14

The Incidence of Incentives

Debrief

The City of Jacksonville, hoping to revitalize their floundering economy, were able to incentivize a fortune 500 company to set up their headquarters in their city. To entice this unnamed company, Jacksonville’s city council had to propose a $400-per-job payment that will be made to the company for the next 15 years.

My Opinion

After initially reading this, I was shocked that a city would feel the need to bribe companies to set up offices in their city.  Why should taxpayer’s dollars go to funding a corporation, which, being on the fortune 500 list, is highly profitable already? That being said, after looking it over and finding some interesting research, I now understand what Jacksonville’s city council is doing. They are providing a well-placed incentive in order for companies to come to their city. I am a great supporter of this arrangement. In essence, I look at this transaction as killing two birds with one stone for Jacksonville. A parallel to Steven Kerr’s article “The Folly of Rewarding A while Hoping for B“, the city is strategically pinpointing what makes corporations tick: money. As Dan Pink describes in his Ted Talk, Jacksonville is appealing to the company’s need for purpose. The unnamed company is looking to increase their profits; however, this cannot be done without firing employees and, in turn, lowering output. Yet, by subsidizing the workers, the city of Jacksonville has found a way to increase the company’s profits without changing output. With growing unemployment in the region, this comes in a time of dire need for the city, creating thousands of jobs for the economy and rejuvenating the aging workforce. After looking at it from this angle, I can see the tremendous economic advantage this gives Jacksonville, and I laud the city counsellors for their ability to successfully bolster their city’s floundering economy.


Gibbons, Timothy. “Fortune 500 Company Lured to Jacksonville by New Incentive Plan – Jacksonville Business Journal.” Widgets RSS. Jacksonville Business Journal, 6 Aug. 2014. Web. 08 Nov. 2014.

Kerr, Steven. “On the Folly of Rewarding A, While Hoping for B.” Academy of Management Journal 18.4 (1995): 769-83. University of Oklahoma. Web.

Pink, Dan. “Dan Pink: The Puzzle of Motivation.” YouTube. The Ted Foundation, 25 Aug. 2009. Web. 01 Nov. 2014

Basch, Mark. “Jacksonville Inflation Remains in Check, Reflecting a Weak Economy.” Members.jacksonville.com. The Florida Times-Union, 15 Oct. 2014. Web. 01 Nov. 2014.

10/27/14

Yesterday’s News: A Response to Sean Fox’s Blog Post

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Debrief

In his blog post “Ethical Dilemma, why are we concentrating on oil companies paying for oil spills and not other companies for emitting greenhouse gases?“, my peer, Sean Fox, questioned why companies were not taking the onus on themselves in reducing greenhouse gas emissions. He argued that with things such as oil spills, companies, feeling the pressure of environmental groups, quickly had to correct their actions to avoid major public relations backlash.

My Opinions

Although bringing up an interesting argument, I believe the critical flaw in Sean’s thinking to be his faith in humanity and capitalism. In my (possibly pessimistic) eyes, most company’s in the natural resources industry do not inherently want to help the environment. The only reason BP had to 465207_386755611364163_559185489_o (1)
respond so quickly to their oil spill was the resounding pressure put on them by the public, media outlets, and environmental groups alike. The key word in that sentence was pressure; a verb not found in the fight to rid the world of greenhouse gases. It has become a forethought in mind’s of environmental groups, a inevitability that cannot be solved in the short term. The media, not seeing a return on their ratings, have pushed greenhouse gases to the shadows. In its overwhelming prevalence of this issue has caused it to become the norm,  and so, like the thousands of death occurring in Africa everyday, its curb appeal has vanished. However, I believe that greenhouse gas emissions can be brought back into relevance. It is my belief that if the public and media should put a substantial amount of pressure on companies to reduce emissions, these capitalists, fearing the loss in profits, will put this topic at the forefront, expediting the quest to eliminate greenhouse gas emissions and, in the process, restoring the health of the planet.


“Sean Fox.” Sean Fox’s Blog. UBC Blogs, 30 Sept. 2014. Web. 27 Oct. 2014.

BP’s Crude Awakening. Digital image. A Better World. Greenpeace, n.d. Web. 27 Oct. 2014.

Slovacek, Randy. “Big Majority of America Support Limits on Greenhouse Gases.” The Randy Report. The Washington Post, 2 June 2014. Web. 27 Oct. 2014.

 

10/7/14

The First Nations Dilemma

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People of the Tsilhqot’in nation marching on the Supreme Court of Canada. The Supreme Court’s ruling gave the Tsilhqot’in people title to 1,750 km of land in Northern BC.

         As the Tsilhqot’in nation vehemently try to oppose the creation of a copper mine on the north tip of the Chilcotin forest, it brings to light the First Nation’s resolve in preserving their culture. As reported in the Vancouver Sun article, a 2014 ruling by the Supreme Court of Canada gave the Tsilhqot’in people title “to 1,750 square kilometres of land west of Williams Lake.” Taseko Mines Ltd. are trying to build the New Prosperity Mine (a copper-gold mine) just outside the legislated First Nation’s reserve lands, in nearby Fish Lake. To counteract this, the Tsilhqot’in people are proposing a vast stretch of forest, which newprosperity_03includes the land designated for the mine, as a Tribal Park, thereby stopping Taseko Mines from progressing any further. Although this has caused some to question the legitimacy of the Tribal Park claim, it no doubt brings up an interesting theme. In my eyes, it appears as if the Aboriginal people are fighting for their culture, the sacred land on which they have lived for thousands of years. They are undoubtedly trying to protect their sacred wilderness from the plunder of profit-seeking corporations. I believe, more than anything else, this brings up a invaluable lesson about consent prior to action. Taseko Mines should have made sure that the Aboriginal people were satisfied before moving further in their proposal. By incorporating all stakeholders in the planning process, Taseko could’ve quelled all concerns and eliminated this controversy. However, by shutting out the Tsilhqot’in people, Taseko alienated the Tsilhqot’in tribe, making them rebel in protest. In its truest form, this shows how greatly business proposals hinge on incorporating all stakeholders into the strategic process.


Pynn, Larry. “Tsilhqot’in Set to Declare Site of New Prosperity Mine a Tribal Park.” Www.vancouversun.com. The Vancouver Sun, 11 Sept. 2014. Web. 07 Oct. 2014.

“March of the Tsilhqot’in.” Ctvnews.com. CTV News, n.d. Web.

“Taseko.” Mines Limited. Taseko Mines Ltd., n.d. Web. 27 Oct. 2014.

 

10/5/14

The Wall Street Problem: A Response to Mark Cuban’s Blog Post

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Mark Cuban, author of Blog Maverick and owner of the Dallas Maveric

Exploring the stock trading market of the 1990’s and early 2000’s, Mark Cuban’s blog post The Stock Market gave an interesting idea into the reason why people buy stocks and stock prices act in the way they do. In the blog, Cuban argues that stock trading is nothing more than a popularity curve, where people invest in the stocks that are trending as popular and move away from those where people are removing their investments. This volatility can often boil down to how well companies market themselves, as, in the day of the Dot Com Bubble, the technology firms that had the best widespread publicity among investment banks often brought along a ton of secondary investment from the common investor. As a whole, I cannot help but side with Cuban on all frontiers, with his greatest success being his ability to correlate the stock market to human instinct.  I instantly related Cuban’s ideas about stock trading to fashion trends in high school. The popular kids always had the newest, coolest, most fashionable stuff, and, soon afterwards, the rest of the school was following in their footsteps. This leads to massive profits by the brands that produce their fashion trends. When the trend changes, the followers are left with newly purchased clothes that they can’t use out of fear of being out of date, rendering the clothes useless. This is essentially what Cuban is talking about, where investment banks, in publishing their buy rating, send a message to all amateur investors as to what

Cuban's company Broadcast.com, whose stock, due to great marketing, went up 225% the first day of its IPO.

Cuban’s company Broadcast.com, whose stock, due to great marketing, went up 225% the first day of its IPO.

companies are on the rise. As a result, these investors flood the demand for a particular stock, causing the stock price to skyrocket. Cuban then goes on to explain the risk in such unwarranted stock prices. This is done by his explanation that companies, despite their sky high stock price, are not bringing in any real money, which means they cannot develop and enhance their products. This eventually leads to the company going out of business, rendering the stocks inept and costing many amateur investors their life savings. In its entirety, Cuban’s post does more than just tell the dangers of following trends in the stock market, it relates business to regular life and human instinct, causing his message to resonate on a much deeper level.


Cuban, Mark. “The Stock Market.” Web log post. Blog Maverick: The Mark Cuban Blog. Mark Cuban, 10 Jan. 2013. Web. 4 Oct. 2014.

Broadcast.com Logo. Digital image. Wikipedia: Mark Cuban. Wikipedia: The Online Encyclopedia, 5 Oct. 2014. Web. 5 Oct. 2014.

Image of Mark Cuban. Digital image. Blog Maverick: The Mark Cuban Blog. Mark Cuban, 5 Oct. 2014. Web. 5 Oct. 2014.

 

10/5/14

The Venture Capital Paradigm Shift

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Mark Suster, the author of the blog

In his blog post What I Hate About Selling Companies, Mark Suster brings up an interesting idea about the family dynamic that accompanies the development of firms by venture capitalists. Suster, a venture capitalist, is constantly being assigned to work with a select team from his fund’s most recently acquired companies, working with the team until the time that the fund sells the company to another firm. Together, Suster and the team find ways to  increase the profitability and efficiency of the company. However, as time progresses, Suster no longer considers these people workers, but instead they become his friends, his family. As Suster writes, once his fund sells off the company, he cannot help but feel a sense of remorse over their diverting paths. Little does he know, this fundamental concept has the ability to change how people and  companies view business ethics and conduct as a whole. In the current state, firms are mostly interested in profits, with Suster remarking how his “job is to return money to LPs [limited partners, essentially investors].” The bottom line is all that counts, which, in the past, has caused people to act in immoral, illegal, and downright devious ways in order to fulfill their prescribed goals. Yet, by Suster’s personal connection to the company and its

Upfront Ventures, the venture capital firm where Suster works

Upfront Ventures, the venture capital firm where Suster works

workers, he has eliminated the impersonal aspect that is quickly becoming the norm of business. Venture capitalists have been known to buy companies and sell them off for parts, taking no regard to the workers and employees who would be left unemployed due to this process. Suster’s close relationship with these employees would make this betrayal less likely, as few people would knowingly and deliberately double-cross their friends, their family. By adding a face and a personality to the workers, he is making these employees real, and making himself empathetic to the prospect of their possible unemployment. Should all investment banks and hedge funds operate in this manner, the archetype of corporate America would quickly turn on its head, becoming a beacon for moral labor practices. In its truest form, the paradigm of hedge funds and venture capitalists will shift, no longer being regarded as the greedy bankers looking to make a quick profit, but instead an ethical profession that sees employees as more than just assets.


Suster, Mark. “What I Hate About Selling Companies.” Web log post. Both Sides of the Table. Mark Suster, 28 Sept. 2014. Web. 4 Oct. 2014.

“Both Sides of the Table.” Both Sides of the Table. Mark Suster, n.d. Web. 27 Oct. 2014.

 

09/10/14

Business Ethics: The Slippery Slope of Unpaid Internships

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Hoping to gain experience in their field of study, it has become commonplace for university students to look for Unpaid-interns-slavery2internships at prominent companies. In fact, as reported in the Economist’s 2013 article Are Unpaid Internships Illegal?, nearly two-thirds of college students will have interned somewhere before graduation. But are these unpaid work experiences ethical? From a surface level, this system compromises the social norm of bartering work for compensation. The students, eager to gain experience in hopes of furthering their resume and broadening future job opportunities, turn a blind eye to the ethical quagmire they are taking part in. On a deeper level, unpaid internships cause a threat to the company. According to R. Edward Freeman’s explanation of Stakeholder Theory, employees are driven by incentives, and, without them, deem it unnecessary to produce top-quality work. This will often cause a business to decline. In their current state, the interns, filling the niche of employees, do not feel obligated to work at optimum levels. However, based on Freeman’s teachings, should these interns be compensated through minimum-wage income or promises of future employment, they would realize the benefit of helping the company prosper and work harder. All withstanding, these reason illustrate the benefits of compensating interns in one way or another.

  TW. “Are Unpaid Internships Illegal?” The Economist. The Economist Newspaper, 07 Sept. 2014. Web. 09 Sept. 2014. Click here for article. What Is Stakeholder Theory? Perf. R. Edward Freeman. Institute for Corporate Ethics, 2009. Youtube Video. “The New World Slavery.” First Reference, n.d. Web. 2014.

Galang, Jessica. Will Work For Free. Digital image. Ryerson Review of Journalism. Ryerson Review of Journalism, 9 Apr. 2014. Web. 27 Oct. 2014.