Monthly Archives: September 2014

September 30, 2014 · 12:12 am

The Competition of Strategy

The topic of Vivian Lee’s blog really interested me. Two leader bands of electronic product are under a violent competition in advertisement, which Samsung Korea’s newest advertisement contained indirect mockery towards the Iphone 6.
That push me to think about market strategy. strategy is not only a series of analysis in finance or accounting, in my opinion, it is a kind of “war” in consumer’s mind. Just like the opinion in (by Al Ries & Jack Trout)—the concept really is about positing that product in customers’ mind. Doubtless, the humors used in Samsung’s advertisement is successful. The clever point is that Samsung used the rival’s popularity to advertise itself, at the same time, this piece of advertisement can pressure Apple’s public reputation.
In my point of view, except being different (which Samsung and Apple are really good at), the more important strategy is that how can the company do ‘replace thinking’. Can the company figure out what is costumers’ need and what is the perspective of its rivals? I believe this point is more crucial for big companies especially for Oligopoly Market.

Vivian Lee’s blog: https://blogs.ubc.ca/leeviviann/

What Contributes to Tesco’s Problem?

As the biggest retailer in Britain, Tesco was found that there is a £250m ($410m) black hole in its accounts because Tesco’s British arm had been booking discounts on goods it had not yet sold as income, while simultaneously understating the costs of the sales it had actually made. It is seems that it’s really a obvious mistake in company operation and strategy making. What happened to Tesco?
It can be find that Tesco over estimated its profit this year and made a higher announcement to the public. That put Tesco in a dilemma which the company must prusue profit while keeping the customer loyalty. In that apparent situation pressure, Tesco chose a “trick” which actually a financial statement fraud to the public. Therefore, it comes out a consequence of deficit in Tesco’s accounting.
The “turning orange” situation push us to think about financial statement fraud (although maybe Tesco was not make financial mistake on purpose). Whether this operation measurement is benefit to the company? In my point of view, regardless the dishonest and the irresponsible to government and public, it is a vicious cycle for decision making in promotion and other activities aiming at the reputation and customer loyalty. The company will sacrifice their revenue to gain public support, which is dangerous to a depreciating corporation.
Furthermore, back to Tesco, as more competitors dropped in and expanded their marketing, Other companies like Waitrose and Marks & Spencer have squeezed the giant’s share of the grocery market. Moreover, managers of Tescothe ignore the quality of service. The dirty, messy stores on the internet, stories of management incompetence at both headquarters and branch level, as well as chronic supply-chain problem have all damaged the brand’s reputation. These two factors have interacted mutually and cause Tesco’s disadvantages in the market competition.
It seems that Tesco is on the same recession way as Sainsbury’s, the managers must take their responsibilities to figure out strategy which is more befitting for the market and pay more attention on customer service as well as reputation maintenance.

Seeking a Balance Between Profits and the Corroborative Ethics

On April 24th,2013, the collapse of an eight-story garment factory in Bangladesh reminded us to think about corporative responsibilities again. killing at least 400 people and injuring many more, this industrial accident is actually not a accidental event. So far, Bangladesh has become the second biggest cloth exporter which needs a great amount of clothing factories, however, the government only have rudimentary laws about nation building.
The reason that such numerous brands choose Bangladesh is obviously the cheap labor, however, it cannot be ignored that the limit investment has more possibilities to cause a worse working condition. It is the corporation’s responsibility, in my point of view, to ensure workers fundamental right, for instance, health and life. We have to acknowledged that the corporate managers themselves are person with basic social responsibilities, besides, they have extra needs to protect their employees.
However, some managers only show the CSR (corporate social responsibility) in some superficial forms like doing charity or advertising on the media because they do not think the costumers would not pay for their social responsibilities. Although Milton Friedman skepticism about the so called “corporate responsibility” is actually increase the cost and the risk of stakeholders( Corporate Ethics and Corporate Governance, by Zimmerli, Walther, Holzinger, Markus, Richter, Klaus) it is still necessary for all corporations to do that since it is also a way to improve company’s reputation in the society. Making consumers confident about the brand and the company ethic itself is not only a business strategy, but also a moral need. On the other hand, it is worth to spend extra money on the ethics because the consumers do not want to pay for a cloth concealing blood and tears. Also, the corporation may pay much more money if there is a safety accident of the producing factory.
Finding a balance between the corporate profit and the social responsibilities would be a essential problem for all managers and the corporate social responsibility should not always be a Utopian element.