Ethical Dilemma

Because I have not really had a job for too long, and I study at Brigham Young University, I have not really had any ethical dilemmas in my life. However, I have seen my dad going through plenty during all his career. My dad is a mooring and loading master, which is a captain of a port that receives all the oil shipments in my country(Ecuador). My dad was in charge of keeping track of the oil that arrived, the condition, and to make sure that nothing weird was going on in the shipments, in other words, he was responsible for making sure that everything arrived the way it was supposed to. In these ports there was a lot of corruption going on, supervisors would still merchandise and money from the company and things like that. One time the oil shipment did not only come with oil, but it was also trafficking drugs. The people who brought the shipment told my dad that they would pay him a lot of money if he would just ignore the drugs, make his report as if the shipments was the way it was supposed to, and if he would not communicate to the authorities of the company about the drugs. My dad did not think about it twice, he said no to the offer, and he did not accept the shipment.  After this he wrote a report to his managers and to the police about the situation, telling them about the drugs and the people that were involved in it. They did not do anything about the problem, some of them were even involved in trafficking drugs so they did not pay attention to my dad. After my dad informed about this problem, he started receiving death threads, so he ended up quitting to his job, and went to work to another oil company.

Walmart

This past week we were assigned to find a current event related to strategy and do a presentation about it. I was reading about how Walmart tried to copy Target's strategy as their new strategy. Walmart is known for having really low prices, and an extensive variety of products. The reason why they have such loyal customers is because they have stayed with their proved strategy. Switching their market to more chick products, and raising their prices a little has greatly disappointed their loyal customers. "The customers did not leave Walmart, Walmart left the customers". This strategy switching has made them realize that they need to stay with what they know works, instead of trying something new. The problem lies in the fact that this issue has already make them slow their growth, lose customers, decrease stock price and the need to come up with a new strategy. Because now there are so many cheapo stores where you can find everything, for Walmart to go back to that strategy would not be that smart, so they would have to start innovating. The only question for Walmart is, how long is it going to take to switch back to a new strategy? What is going to happen mean while?

Building time

Lat week we were assigned to build a tower that could hold a golf ball out of sticks. There were seven people in my group, everybody was wondering what would be the most effective way. After talking various ideas, we decided that our strategy would be team work. There were some people in charge of the top of the tower (specialization), others were in charge of the middle part, and the others were in charge of the base. One thing about our group is that we did not only want the tallest tower, but also the most stable one. We were considering ideas that would not only make it go high, but also that would make it last. Everybody was giving ideas, and so we started testing. One thing about our strategy is that we took in consideration everyone's ideas and did not ignore them. Once we notices certain structure worked, we each chose different parts of the tower we wanted to specialize in building, so in that way we could do it faster. At the end we came in second place on which was the tallest, but our tower was the one that definitely lasted longer. In the same way it has to be with a company;s strategy, it is not only about growing fast, or a lot, it is about being there for your customers always, and with a good product. In our case having a lot of people bringing different ideas was good, because we knew how to team work, but if you cannot, it is better to just keep the employees that have the most knowledge.

Capstone

This week we finally started the business simulation with Capstone. In this simulation we have to think about managing the products the company produces, marketing, financing, etc. One of the options that we have in the program is to come up with new products and do all the activities necessary so it can a success. While we were deciding with my group if it was a good idea to come up with a new product, the things that came to my mind were, how big of a scope to we want to have? Are we going to come up with a low cost product or a differentiated product? I thought about the trading that we would have to do, like, if we create a differentiated product the cost would be high and only some customers would be able to afford, but at the same time, it would be something different, something that would create a more close relation with those who do get the product. Just like in the Ducatti and Apple case, both differentiated product, both high price product, but still both products have loyal customers because they bring something different to the table, something that customers cannot get from other companies. Companies have to take risk, and that is what we did with my group, we went after the product we thought would make a difference (in the differentiated segment) and we hope it works.

"When innovation, too, is made in China"

"When innovation. too, is made in China" is an article I read that talked about the new strategy China is planning. China's past strategy had been to be a cheap labor force that can imitate every product but at a cheaper cost. This country's economy is based mainly in cheap products exports. Lately their government has decided that it is time for them to create their own patents, instead of just imitate products. Basically with this decision they are going from being a country that has operating effectiveness, to actually have a strategy. They are not planning on doing something better, but instead on doing something different. They are planning on mainly attack the technology industry. This is an industry that has a lot of entry barriers. Many companies have had their company name out for many years, and so there are many loyal customers who would be hard to gain. The buyer power that customers have is higher that the supplier power. There are many products that do the same things and the more supply there is, the cheaper it gets. China could only achieve supplier power if they really create patents that only they would have the right to produce. One of the pros of China's decision is that because they have a cheap labor force, the products they would create would be cheaper, and so people would prefer to buy them  Rivalry in this industry is high, there is Apple, Sony and many others. For China to achieve the level of this companies, it would require high investments in research and development, and marketing. Still, all this is not stopping China. Now one of the strongest economies, is planning on creating twice as much patents as the United States. China's economy is growing and these changes in their strategy, may make them unstoppable.