week10

1. In your own words and using referenced quotes describe what is meant in strategy by ‘organizational purpose’ and describe what is meant by ‘corporate social responsibility’.

                                                      
The main purpose of every organization is to meet their pre determined mission, vision, goal and objective. They exist and operate to get their purpose and it will be possible through strategies. Every organization bear common purpose of making maximum profit, customer satisfaction, increasing the market share and increasing shareholder’ value.  But this purpose are break down in long term and short term objective of the organization.

World famous McDonald’s has its organizational purpose as being the best by “providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile."
                                                  
Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large. (www.investopedia.com)

The European model is much more focused on operating the core business in a socially responsible way, complemented by investment in communities for solid business case reasons. Personally, I believe this model is more sustainable because:

1.      Social responsibility becomes an integral part of the wealth creation process - which if managed properly should enhance the competitiveness of business and maximise the value of wealth creation to society.

2.      When times get hard, there is the incentive to practice CSR more and better - if it is a philanphropic exercise which is peripheral to the main business, it will always be the first thing to go when push comes to shove.

2. Should organizations focus more on profit and shareholder satisfaction or responsibility and stakeholder satisfaction? Discuss your own thoughts but try to support your ideas with theories or examples.

Stakeholders are people or groups that are most likely to get affected by an organization and vice versa. This group comprises of customers, government, society, government, employees and employees. It is through their co-operation and coordination that an organization's success depends and without them being satisfied, it will be very hard for an organization to perform well. There is no doubt that organizations operate for profits and to satisfy shareholders. But what is most important for an organization in long term is goodwill and credibility and the two ways of gaining these are undertaking corporate social responsibility and satisfying the stakeholders. There also other benefits that come with these such as good reputation, access to capital and resources, reduction in costs and so on. Thus, organizations should focus more on responsibility and stakeholder satisfaction rather than profit and only shareholder satisfaction.

For instance, Pepsi Co an American Multinational Corporation that manufactures and supplies food and beverages donated $20m to a project named Refresh Project that helped orphans. In the same way, Chaudhary Groups a renowned FMCG company in Nepal organizes various sponsorship and scholarship programs for the welfare of the society. Though, one of the major objectives of these companies is to earn money, they are also working towards bringing social reforms in the society. They are socially responsible and have been conducting corporate social responsibilities in the form of various activities, projects and programs. This has helped gain these organizations goodwill and credibility from the customers and stakeholders which in result has helped them better their performance and stand out from the crowd.

3.Write about experience with today's case study? What answers did you give to the questions? What did you think of the CEO? 
The case study was not just an academic work for me but also a good source of information about PepsiCo, its products and strategies as I didn’t know much about the company. The only products I knew that belonged to PepsiCo are Pepsi and lays but now I know that there are many other products and product lines of PepsiCo and I will definitely try some of them.

Talking about the CEO Indra Noovi, is an inspiring lady. She has proved us that even a woman can work well and be a top professional in her field. She has managed to well handle this big and reputed multinational corporation. In addition, she is also working for making the corporation a corporate citizen and she is doing this by offering healthy foods and drinks to the customers as well as sponsoring and donating huge amount of money to programs and projects. Indeed, she is a woman who is kind, generous, smart and confident. 

REFERENCES

1. Corporate Social Responsibility<online> Available at<http://www.investopedia.com> Accessed on [10/01/13]

2. Governance and ethics<online> Available at <http://csr.cisco.com/> Accessed on [09/01/13]

3.TakingITGlobal; Corporate social responsibility. <online> Available at < http://issues.tigweb.org/csr?gclid=CKmLvav4zrUCFct56wodjnYAng > [Accessed on 07/01/13].

4. Corporate Social Responsibility <online> Available athttp://www.businessdictionary.com/definition/corporate-social-responsibility.html [Accessed on 09/01/2012]

week9

WEEK 9

1. Mwailu & Mercer has described resource-based view (RBV) as the basis for a competitive advantage of a firm lies primarily in the application of the bundle of valuable interchangeable and intangible tangible resources at the firm’s disposal.

Organizations may have tangible resources like assets, human resource and capital or intangible resources like brand image, information, culture and knowledge. These resources used in the organization certainly have its importance but the matter of concern is how they are used. In strategy, resource based view can be defined as the formulation of strategy so as to gain competitive advantage over other by focusing on how efficiently and effectively the internal resources and capabilities of the organization can be used. Each and every organization has same or similar resources but it makes difference depending on how they are used.

2. The analysis that can be undertaken to assess the internal factors of an organization is known as internal strategic analysis. Internal factors of the organizations may include resources, competences, goals, objectives, structure, and systems and so on. These internal factors help in identification of performance of the business according to the change in external environment and its strategic capabilities that can be used to gain competitive advantage.

There are different model to undertake internal analysis of the organization:

McKinsey’s 7s Model

McKinsey’s 7s model assesses all the internal aspects of the organization. It helps in the analysis of the performance of the organization by implementing the strategies using staffs and skills as well as shared value. It can also identify whether the systems and structures are compatible or not.

VRIN Model

VRIN model helps to spot out the organization’s strategic capabilities and key resources. After identification of these resources and capabilities they are used in such a way so that no one can cope and imitate it and is rare. These resources even help to gain competitive advantage over others by forming core competences.

Value Chain Analysis

A chain of activities starting from extraction of raw materials to offering final products to customers is known as value chain whereas value chain analysis is the analysis of activities that adds value within the chain, relationships between the activities and those activities that can be seen in terms of strengths of an organization. This analysis divides the value chain into different groups of activities, identifies the activities that are best and worse within the value chain and identifies activities that give competitive advantage, value to the products and decreases costs within the value chain of an organization and develop strategies that best utilize these activities and other resources.

SWOT Analysis

SWOT analysis helps to identify the strengths, weaknesses, opportunities and threats of an organization. Strengths and weaknesses of organization are identified for internal analysis whereas opportunities and threats are identified for external analysis. It helps to identify resources knowledge and culture of an organization which is the strengths of an organization and these strengths can be used to grab the opportunities in the organization’s external environment and overcome weaknesses. It also helps to identify weaknesses which must be defeated.

Reference

Books
JohnsonG,ScholesKandWhittingtonR(2009),FundamentalsofStrategy,PrenticeHall.
LynchR(2008)StrategicManagement,5thEdition,PrenticeHall.

week8

1.  Make a list of competitors for Islington College.

     Some of the competitors’ for Islington College are listed below:

·                     The British college

·                     Softwarica College of IT and E-commerece

·                     Ace institute of management.

·                     WLC

·                     Apex college

·                     Kantipur city college

·                     KIST College

·                     Kings college

2. Develop a porter's five forces model for Islington College.

Michael Porter developed the five forces model to analysis the attractiveness and captivation of any industry, to locate the means of completion with respect to the industry and to help to position the industry. Beside the rivals there are also the various other factor affects the organization performance. Those factors specifically external factors are evaluated with the help of Porters five forces model.

The five forces model includes the following:

Following are Porter's five forces model for Islington College:

Threat of new entrants:

Ø  Huge initial capital investment.

Ø  Student and parent constancy.

Ø  Economies of scale.

Competitive rivalry:

Ø  No. of competitors

Ø  Exit barriers

Ø  Level of similarities of customer

Bargaining power of suppliers:

Ø  Brand image

Ø  No. of suppliers

Ø  Switching cost

Threats of substitutes:

Ø  Student willingness

Ø  No’s of short and long term IT courses

Ø  Cost and quality relation on education

Bargaining power of buyers:

Ø  Price elasticity

Ø  No. of students

Ø  No. of choice for selecting college

Threat of new entrants: 

Where there is more profit people will invest more and there will be high competition. In the respect of threat of new entrants it totally depends on the barriers to entry. Set-up costs, customer loyalty, economies of scale and legislation come under this force.

Its very expensive to start and run the college providing international degree in Nepal. Islington College has invested a huge amount of capital to create it. Now its leading education house providing international degree in Nepal. As the licensing process is also very complex it will be very difficult to new college to get into the competition with Islington College.

Competitive Rivalry:

If the number of industry providing same product and services are more in market than there will be high competition. In context of international degree providing intuitions in Nepal, Its number is very low. Eventually the competition is not high. Islington College is oldest and best one it do not have any serious rivals in market.

Bargaining power of buyers and suppliers

This is the relative power of the customers/buyers to influence a firm. Buyers have this power when they have more choices and they purchase high volume of products and services form the suppliers. 

Islington College currently is providing its services to around 600 students. There are many who want to study in this college and every semester there are hundreds of students applying for the college. The reasons for this is quality education and few colleges providing international degree. The students have very few choices and thus bargaining power of buyers here is relatively low and the bargaining power of the college is very high.

Threat of substitute products:

Substitute products and services reduce the demands for a firms service and product. Customers switch to substitutes due to various reasons such as increase in price, decrease in quality and so on. Substitution can be in the form of products or needs. For Islington College, there are various threats of substitutes like Computer Engineering courses, short term certified IT trainings and Computer Application Development courses.Also, the later trainings are cheaper and are of short duration too. Many people these days in order to save time and money attend trainings and short term courses. Thus, this shows that there exists high level of threat of substitute products for the college. 

3. To which strategic group might Islington college belong?

4. Can you map the group?

References:

(n.d.). Retrieved from www.ebiz.educacao.ws: http://ebiz.educacao.ws/Arquivos/Artigos/Strategy_and_the_internet.pdf

(n.d.). Retrieved from https://dspace.lib.cranfield.ac.uk/bitstream/1826/1179/1/JMD%20-%20Strategic%20Group%20Theory%20Revised1.pdf

(n.d.). Retrieved from dspace.lib.cranfield.ac.uk: https://dspace.lib.cranfield.ac.uk/bitstream/1826/1179/1/JMD%20-%20Strategic%20Group%20Theory%20Revised1.pdf

week 7

PESTEL analysis of Big Mart

 PESTEL analysis is very important for every kind of organization to know about their external factors and their effect in the organization. PESTEL analysis deals with the political, economic, social, technological and legal factors of the industry. It plays very important role in the planning of the organization to achieve the pre determined goal of organization by setting specific pathway. 

Fig: Big Mart Kathmandu

Political factor

Political is one of the factors that affect the Big mart industry directly or indirectly in many ways. As we know the political condition of Nepal is not so stable which is affecting the Big mart industry. Political factors like strikes change in the rules and regulation, instable system affects the industry to close or restricts them to work freely. In order to run the industry smoothly the political factors must be studied well and plan for future.

Economic factor

The economic factor of the country also directly or indirectly affects the Big mart industry. If the economic condition of the country is not good then there will be no value of opening the industry because in order to run the industry people income must be good which depend upon the economic condition of the country. Therefore, political factor must be analyzed in order to run the industry efficiently.

Social-cultural factor

Every people has its own kind of need and demand according to their cultural or social aspects so, big mart must have to understand and satisfy their need and demand according to their cultural aspects, goods and products must be provided according to the age group of the people living in the country. As we know there are many different people living in different style like student, family, youngsters etc they all have different demand of goods and product so the industry must take care of that in order to archive its goal.

Technological factor

Now a day’s technology has been increasing rapidly and making a revolutionary history in every field of business and one of them is in shopping industry where people get various ways of buying the product. Technology like ATM, online buying etc helps people to buy the product from the Big mart. In order to keep on doing the business in the market the Big mart industry must study or analyze the technological factor of the country.

Environmental factor

Big Mart should have excellent knowledge about the environmental factors. Environmental factors includes the climates, natural disasters, etc that may impact on the transportation. As a result this will also affect the demand pattern in the business opportunities.

Legal factor

Legal factor of the country is also one of the factors affecting the Big mart industry. Rules and regulation of the country must be analyzed well in order to achieve the goal. As for now the big mart industry has done well in the market where people are being satisfied till now. Better understating of the legal factor of the country helps big mart to achieve its goal for longer period of time.

Reference

Books
JohnsonG,ScholesKandWhittingtonR(2009),FundamentalsofStrategy,PrenticeHall.
LynchR(2008)StrategicManagement,5thEdition,PrenticeHall.