ray of light

blog entry

2006-04-16T06:06:00.000-07:00

http://www.gulfnews.com/world/Sweden/10032725.html

Contact lens solution off market

Using Baron’s framework to analyze this article, I can state that the sales of Bausch and Lomb is going down drastically in Sweden as they state that “ReNu accounts for 25 per cent of Synsam's sales of contact lens solutions in Sweden”. Moreover, we can expect the sales to drop down more in future as the lens users will prefer buying other brands solutions as they want their eyes to be safe and risk-free in future. The issue identified here is that Bausche and Lomb’s cleaning solution is suspected to cause “rare fungal infection that can lead to blindness”. In addition, it may also cause scaring of the cornea through repetitive use. This has cause concern among major interest groups such as the Food and Drug Administration (FDA) which has already started investigating the cause of the infection. The major institutions identified here are public sentiments and news media. The loyal users of Bausche and Lomb will doubt the credibility of its brand and the product and would be hesitant to use any of its products. Personally speaking even I was shocked to hear this news as I have been using Bausche and Lomb products since 6 years now. I discarded the lens solution immediately off my shelf. Similarly, any users of Basuche and Lomb may never use its products again in future to be safe from the risk of getting blind. The news media have already been flashing this news to the public in states, Europe and Middle Eastern newspapers which again damages the reputation of Basuche and Lomb. From the information point of view, the potential customers on hearing of this issue will never be willing to try or use Basuche and Lomb products after they get to know that it has been causing eyes infections and scaring which causes blindness.

blog 7

2006-04-14T06:38:00.000-07:00

http://search.gulfnews.com/articles/print_friendly_version.jsp?global_name=/channels/gulfnews_com/articles/05/09/14/181649.html

Call centres in India face challenges

I used resource-based view for the analysis at industry level. Initially, the performance of the business process outsourcing (BPO) industry was growing at a very fast pace with experienced and educated workers emerging everyday with new jobs. This can be noted from the article where it states that “The infant industry has grown explosively. Youngsters have hopped from job to job. Staff-attrition rates for the industry as a whole have climbed to 45-50 per cent a year”. However, lately the industry has predicted a downfall in the outsourcing industry due to over night shifts and the workers are “put up with abuse and undergo undignified security checks”. As stated in the article, “BPO workers expected to reach 1 million by 2009, a shortfall of 260,000 qualified personnel is predicted” which means that India most valuable resource which is its human capital is being degraded without putting them into the most appropriate use and taking the best out of it. From the Financial capital point of view, we can state that the as workers have started demanding higher salaries now, the financial capital of the industry as a whole and per company is decreasing. Under the present circumstances, I can predict that the hike in salaries will continue to increase as the competition among the qualified call center workers is increasing day by day. From the Human capital point of view, the call centre industry’s human capital has been increasing exceptionally with “Nearly 3 million English speakers graduate[ing] from university every year”. However, call centre firms have been hiring more and more less-qualified workers without even checking their references which reduces the quality of human capital. Moreover, it even raises training costs for training these unqualified workers which decreases financial capital even more. Human capital of the industry as a whole is predicted to be reduced by 2009, facing “a shortfall of 260,000 qualified personnel”. At a certain point of time, the outsourcing industry will have such a large pool of mixed qualified and unqualified workers that eventually the industry as a whole is going to suffer in terms of financial and human capital loss.

blog 6

2006-03-25T07:00:00.000-08:00

Sony searches for a sledgehammer
http://news.ft.com/cms/s/d78e421a-2de8-11da-aa88-00000e2511c8.html

According to Hamel, a business mission is the one that “captures the overall objective of the strategy- what the business model is designed to accomplish or deliver”. Sony, unlike its competitors did not change its base, the business mission which is to produce consumer electronics. The basic business of Sony is still dependent on electronic sales. This can be noted from the chief’s comments which stated that their aim is to “build on the strategy of previous management” and not restructuring it all over again.
Product/Market scope tells you where the firm chooses to compete and where it doesn’t along with products they want to sell. Sony plans to increase its product scope by building “champion products” such as Apple’s Ipod. Moreover, it plans to integrate hardware and software together and produce unique products which will get them more sales as a range of their innovative products.
According to Hamel, “basis for differentiation captures how the firm competes and how differently than its competitors”. Sony plans to increase its future growth by integrating hardware and software which will be their point of differentiation as compared to other giant competitors. Moreover, as stated in the article, they want to differentiate their products by developing their software applications first and then use content to sell those applications without loosing its electronic roots.

Configuration in this case would be the break down of barriers for integration and getting rid of cultural barriers which is stopping them to restructure the business completely.

According to Hamel, Core Competencies is “what the firm knows” which is its resources and capabilities. Sony’s success is built on its ability to use content in terms of its electronic sales. Moreover, another powerful resource that Sony proudly boasts of is its employees who consistently work hard to produce uniform products with greater efficiency. Sony’s strategic asset would include the brand name Sony itself which will be patented for life. Lastly, Sony’s Core process will be the way it will use a new process to integrate all different technologies in new product.

blog 5

2006-03-07T11:45:00.000-08:00

http://archive.gulfnews.com/articles/05/09/06/180424.html

After analyzing the article, we can come to a conclusion that Maya Lal’s is trying hard to stay in line with its competitors such as Choithram and Safeer through increasing its number of stores in every strategic location possible. We can note that during the initial days of its opening, they had created a barrier to entry through product differentiation as it was the only store of its kind. “The company along with Lal's had once controlled the UAE's retail sector” through which they had achieved successful brand recognition as it was the only departmental store available during that time. Plus, it was easy for them to maintain a loyal clientele as consumers did not have much of a choice. However, as years passed by, more and more new stores came up in the market and Maya’s became one of the regular retail stores unlike the ‘Only’ one. Maya lal’s were not clever enough to create switching costs for its consumers to retain them for a long period of time. From Hamel’s point of view, we can note that Maya lal’s is expanding its market scope as it has recently opened a supermarket each in Al Reef Mall and Al Murooj Complex on Shaikh Zayed Road. Moreover, it is also opening “the first British Home Stores (BHS) in Poland on September 9, as a part of global expansion strategy”. They do no plan to expand its product scope for time being in form targeting a new segment by opening up hypermarkets like the ones we see around in Dubai as they still see enough scope for their medium ranged retail stores. Lastly, the company has split off its partnership with Lal’s which actually can be one of the reasons why it is losing its popularity lately. I believe that Maya’s most strategic assets are its origin, its organizational culture as well its customer relationships. Considering that Maya’s is a local company, its origin is a strategic asset in this case because it appeals to local’s sense of supporting local businesses. The element of Maya’s customer interface that is most responsible for its success is relationship dynamics as it has an advantage of having closer contact with customers than large hypermarkets do because its is a medium sized retail store of its own. This enables Maya’s employees/management to learn from its customers, adapt in order to better suit needs and to gain customer loyalty.

blog 4

2006-02-16T02:17:00.000-08:00

Wal-Mart has been known for producing things exactly what consumers want to buy and offering a wide range of goods at rock-bottom prices. But little do they realize that they are putting people out of work and lowering their standards of living as the workers are on the losing end unlike the consumers. Recently, Wal-Mart has been trying to open a store in the New York city. However, the New Yorkers are not really happy about it and are “least supportive of the firm and its practices”.
According to Barney, “In order for resources and capabilities to be strengths, they must enable a firm to exploit environmental opportunities or neutralize environmental threats”. Wal-Mart has been successfully exploiting environmental conditions in United States and profitably tops the third position in the world of retailing. After creating a name of its own in U.S, now Wal-Mart is using its value base in China as it plans to penetrate furthermore with 56 stores already in hand. Even though Wal-Mart has a big value base, it is easy to imitate by its competitors. Competitors would not face any Causal ambiguity as Wal-Mart is a retailing firm and is easy to spot out the resources and capabilities controlled and owned by a firm. One of the resources that they boast on is their employees. They offer them a very competitive package of benefits through which they attract people to work for their company. Similarly, its competitors can attract same number of employees and run a similar kind of store without facing any cost disadvantages. The competing firms could directly duplicate the firm’s resources by hiring the same employees and attracting them with a better pay structure. Furthermore, substitution is also possible in this case as the competitors of Wal-Mart can hire new employees equally competent as Wal-Mart employees and retain them with a lower pay through which they would have an advantage over Wal-Mart. Wal-Mart even has a competitive parity in its firm as their resources and capabilities are very valuable but not rare as anyone can own it in the same industry.
The article also states that “WalMart has no stores in the New York City due to resistance from Coalition from labor, Civil rights and community groups”. This implies that WalMart had been facing barriers to entry as mentioned in Porter’s article. However, these barriers could be surmounted in future as the article states that “people can both dislike WalMart yet shop there”. Even though the consumers and the society think that WalMart is somehow unfair to people, they will still shop from there because of the value created by WalMart in the past.

Blog entry 2

2006-02-10T04:14:00.000-08:00

The whole muslim world has been reacting fierce fully to the controversial cartoons published in the Danish media on Sept 30th and Jan 10th. In retaliation, all the major supermarkets around the Muslim world have boycotted the selling of Danish products from their shelves.

In the article “Effect of Danish boycott patchy” we can see elements of Customer Interface and its components taking place from the Hamel’s Thoery. This can be proved as follows:

Firstly, the manager of one of the flagship supermarkets had immediately discontinued the sale of Danish products to provide its Muslim customers immediate gratification. This can be related to the relationship dynamics where the manager had aptly taken care of their customer sentiments.

Secondly, the article also states that the manager of one of the major supermarkets in the north Jeddah had provided a full refund of the purchase of one of its Danish products to one of their customers. This can be related to providing customer benefits as the manager understood the want of a customer under the given circumstances and provided the needful.

Thirdly, the sales flyer covering Jan. 25 to 31st of Panda included the word canceled in “English” and “Arabic” which can be related to the relationship dynamics again as they wanted to inform their customers that they do not serve the Danish products anymore and prove their loyalty towards them. Another point related to customer loyalty can be noted in the article when it states that “SADAFCO had decided to clarify to the public that it and its products have nothing to do with Denmark anymore, not even its raw material” and had also posted a statement assuring their Saudi and gulf investors that they do not connect with the Danish products anymore. This will positively affect their company’s stock price as the company will gain back the confidence among its customers through maintaining a loyal relationship.

Talking about Porter’s theory, we can note that the Buyers (major supermarket and stores) are competing against the Danish industry to cut down Danish industry’s profitability in order to retaliate to their absurd cartoons.

Blog Assignment-pooja Sagar

2006-02-01T02:56:00.000-08:00

The case “Google Is Destined To Fail In China” states that “Currently in North America, Google rules search, Yahoo rules the Web, and Microsoft rules the operating system.” Although these companies have the same Product/market scope which is the internet, they have a unique business mission of their own which doesn’t classify these companies as competitors and lets them play safe in their own markets.
Till date Google has been successful in North America due to its business mission which is a “Search portal”. Since Google is an American company it has not faced any barriers to entry in US. However, in the case of China, Google is an American company which is trying to enter a Chinese region and compete with the Chinese companies which will not be accepted by the Chinese government and consumers. Another reason why google won’t be successful in the Chinese market is because as the case states “In China, rival Internet companies have developed a symbiotic relationship”. This means that these firms have successfully established their loyal customers through product differentiation. Due to this reason, if Google enters the Chinese market, it has to spend millions to establish a brand identification which means higher initial losses. Moreover, Sohu, Sina, and Netease are rivals in the market since they are “roughly equal in size and power”. Therefore, Google will face strong retaliation from these existing competitors which will eventually throw google out of business from China. Therefore, Google should not enter china and stick to its loyal markets. Moreover, Google has established a successful wealth potential in North America where its customers believe in them and value google’s efficient way of delivering its services differently.

In order to gain a market share in a Chinese industry, Google can change its business mission from a “search portal” to a “search portal + added services” company. This way it can be different from the existing Chinese companies. There are still chances of google’ success in China because of its new Google library coming up. This service of Google can be identified as Product differentiation strategy as none of its competitors in China has offered the library service till date.

Test Post

2006-01-23T23:53:00.000-08:00

Test Post for MGT 406 at AUS