HI6006 Competitive Strategy Tutorial 2 Solution

Hi6006 Competitive Strategy

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Week 7 – Cisco

Q3. How will the organisational capabilities translate to core competencies that give Cisco a sustainable competitive advantage in their industry?

CISCO is globally recognised organisational and best in it’s industry of networking and internet.

An organisational capability translate to core competencies like Cisco having a sustainable competitive advantages in their industries with the following way:

1) Value chain and well defined business structure

2) Technological advantage

3) Financial capability advantage

4) Human assets in order to achieve maximum competive advantages.

CISCO shall be benchmark industry to maintain advancement in all the area of business horizontaly and verticaly as a sustainable competitive advantages

Step 1

The unique or exclusive features of a company and/or its offerings that improve its perception in the target market as being superior to the competitors and a significant and better business are the competitive advantages of the company. Hence these are the factors due to which the customers may prefer the products/services of one company over the other and the capabilities and strengths may also generate brand loyalty. A firm can have a competitive advantage in terms of cost leadership- when a firm offers the same or even better quality of products/services as the competitors do, but at a lower price.

Step 2

Differentiation- when the products/services of a company can provide different, important, and worthwhile benefits, it is termed as differentiation. The differentiation factors may include better delivery, higher quality, a greater number of features, innovative features, and/or any other kind of special or exclusive attribute that can be associated with the offerings. Innovation is one of the common ways to achieve differentiation.

Niche/focus/segmentation strategies- these pre-defined strategies are for targeting a given or specified target market or market segment.

Step 3

Other competitive advantages may also include network effect (when business offerings become more valuable when more and more people use it), brand loyalty, and big pockets (when firms have huge financial strengths and can offer products/services at low prices).

Cisco has enhanced its strength and capabilities by acquiring many more tech companies and can build the latest network products for internet users (including businesses). The network products bring the company competitive advantages, as they become more and more popular and wanted with more people using them. These products can get automatically promoted as well to a greater extent when the corporates use them for maintaining their relationship with stakeholders including customers and suppliers.

Week 8 – Walmart China

Q3. Identify the challenges Walmart need to overcome affecting their implementation of international strategy.

Answer

There are some challenges that Walmart needs to overcome affecting thier international strategy-

The first challenge is Economical factor of China. Economy of a country plays very important role for a company wants to enter and expand business in foreign country like China. Economic factors of a country involve like income level, purchasing power, financial institution, employment level etc. Even though Economy of china is seeing growth but It is challenging for Western companies like Walmart.

The second challenge is Political factor that challenges Walmart to implement its international strategy. Walmart had to deal with poor relationship with Politicians at local and national level. In China, Walmart faced fines and closure of some of its stores on temp. basis for violation of local and national laws.

The third challenge is Cultural issue in which Walmart faced difficulties in understanding the culture of Chinese and how to meet needs of Chinese customers. They failed or faced difficulties to understand the values and cultures of chinese consumers. This is why they haved faced coming up with right marketing mix for chinese customers in 117 cities it operated in.

Week 9 – QANTAS

Q3. What are the advantages and disadvantages to Qantas’s international cooperative alliances?

Advantages:

· International cooperative alliances ensure a more resilient and sustainable base for Qantas: By implementing the strategy of international cooperative alliances, Qantas successfully builds a promising base for grabbing better growth opportunities and leveraging them in the international market.

· It helped in transformation: International cooperative alliances helped Qantas in improving their cost base, increased their aircraft utilization as well as it helped in redesigning of their network to high- growth markets.

· It helps in capturing major international tourist hubs: International cooperative alliances helped Qantas to expand their operations in international destinations that provide tremendous profitability to their flights and help in capitalizing their growth.

· This strategy helps in connecting key business hubs thus increases profitability: The connectivity between business hubs ensures tremendous profitability for their business market segments.

Disadvantage:

More than 50% of the international capacity of Qantas is focused on Asia: Targeting the future growth opportunities Qantas has placed its more than 50% international capacity only on Asia. If predictions go wrong the brand might have to pay a big price for it.

The major problem in international cooperative alliances with Qantas is that of sharing control with its international partners (Emirates, China Eastern, and American Airlines). This sharing of control with international partners might lead to disputes and loss in profits.

The Decision-making process of Qantas might be interrupted. In implementing the strategy of international cooperative alliances, Qanta’s decision making strategy might suffer. The reason behind it is the opinions of international partners have to be given equal importance while making decisions; this might sacrifice the actual decision of Qantas.

Alternate answer

Step 1

Qantas’s international cooperative alliance is a strategic move taken by Quanta with respect to acquiring the best business opportunities and growth. The advantages and disadvantages of Qanta’s international cooperative alliance are as follows.

Advantages

• The international cooperative alliance will develop a strong base for Quanta in the international market.
• The international cooperative alliance will help the Quanta in enhancing their cost base, enhancing their aircraft utilization, and redesigning of Quanta’s network to high-growth in the global market.
• The cooperative alliance will help the Qantas to reach more customers and expand their business in the multiple foreign markets that will provide tremendous profit and high growth to Qantas.

Step 2

Disadvantages

• Qantas has applied 50% of its total efforts towards the Asian market, they are highly focused towards the Asian markets. If the predictions go wrong, the company might have to suffer a huge loss.
• Another biggest issue with Qantas is that the company has multiple partners. Thus, to bind all the partners with a single rope is also a tedious task. A bitter conversation among partners may lead to huge conflicts which might cause a huge loss.
• Another problem Qantas might suffer is regarding the decision-making process. In the cooperative alliance, every partner has been equal importance and the opinion of every partner has to keep in mind while making any business-related decisions. Thus, while implementing the process Qanta’s decision-making strategies may suffer.

Week 10 – Procter and Gamble (P&G)

Q3. Describe how effective corporate governance seeks to ensure ethical decision making by a firm’s top-level managers.

Corporate governance is a broad term which consists of the rules, relationships, and how the tasks in a company will accomplish. It is very crucial for the company because the stakeholders trust the companies following the corporate governance guidelines. The primary purpose of a governance system is to ensure that the company achieves the outcomes in the given time frame. Ethics refers to the honest and moral practices in the business. There are many principles of ethics; some of them are Truth-telling, beneficence, autonomy, promise-keeping. Corporate governance is very crucial for the company so that it can meet the expectation as well as the ethical requirements simultaneously. Management can act as a synonym of supervision. The balance between corporate governance and social and economic ethics is essential. Ethics ensures the accountability and reliability of the operations and decisions of the enterprise. The firm must strike a balance between the individual good and the social or communal good of the country. It is because the company uses the resources of the society, and it is essential to be truthful towards them. The main ethical issue that can arise is in the case of product advertisements. The reason behind this is that often companies indulge in malpractices to sell their product, which is ethically wrong. Hence, ethics, as well as corporate governance, should go hand in hand.

Alternate answer

Effective corporate governance at P&G will make sure that there are guidelines and governing bodies which would help the company and its Top level managers to do business ethically and legally . Corporate governance is all about controlling and abondoning those business practices that raise ethical and legal issue to company like P&G. Effective governance will bring more transparency, honesty, integrity and respect in business decision making.

When Top level managers like CEO, CFO, BOD, presidents etc follow corporate governance practices then they take decisions which benefit the company, customers, employees and government. for example-P&G’s Top level managers will hire auditor to audit finacial position of the company and make report which would be fair and transparent to the shareholders and public.

There has been scandals like Enron scandal, Wells Fargo scandal due to unethical practices of Top level managers and leading to fraud which is unethical activity. P&G as well reputed company under corporate governance can help Top level managers to focus on taking business decisions which reflect ethical values honesty, transparency, fairness,integrity at all level.

Having a effective corporate governance in P&G will ensure that top level managers follow their fiduciary duty, take decisions which are ethical and comply with US laws while conducting business.

Alternate Answer

Step 1

Actual corporate governance at P&G will make sure that there are guidelines & governing forms which would support the company & its Top-level managers to do business ethically and legally. Corporate governance is all about controlling and abandoning those business practices that raise ethical and legal issue to company like P&G. Effective governance will bring more transparency, honesty, integrity and respect in business decision making.

Step 2

When Top level managers like CEO, CFO, BOD, presidents etc follow corporate governance practices then they take decisions which benefit the company, customers, employees and government. for example-P&G’s Top-level managers will hire auditor to audit financial position of the company and make report which would be fair and transparent to the shareholders and public.

There has been scandals like Enron scandal, Wells Fargo scandal due to unethical practices of Top-level managers and leading to fraud which is unethical activity. P&G as well reputed company under corporate governance can help Top level managers to focus on taking business decisions which reflect ethical values honesty, transparency, fairness, integrity at all level.

Step 3

Having effective corporate governance in P&G will ensure that top-level managers follow their fiduciary duty, take decisions that are ethical, and comply with US laws while conducting business.

Week 11 – Coca Cola Amatil

Q3. Identify the key stakeholder groups and their specific expectations of the organisation with reference to corporate social responsibility (CSR) and describe how CCA strives to improve their social impact.

The Corporate Social Responsibility efforts of Coca Cola Amatil is completely in accordance with the economic, ethical and discretionary framework. The below listed are the key stakeholder groups in the CSR model of Coca Cola Amatil, which is also known as the CCA Sustainability:

1. Our People

CCA launched People Pact in 2017, which was a statement of how they will work together to achieve organizational growth. It also encompasses the leadership capabilities and vision and values of the organization. In 2019, they launched Amatil Leadership Development Programs to support and develop inspiring leaders within the organization who would empower and encourage their teams to strive for better. This resulted in enhanced capability and increased engagement within the teams. CCA also has a Women in Leadership program that is named after David Gonski and ensures that at least 30 percent of the positions in the board and senior management are held by women.

2. Wellbeing

Wellbeing of their customers has always been the primary focus for CCA. In the recent years, they have made good progress towards reducing sugar in the non alcoholic beverage portfolio. They have reformulated various products in different countries to reduce the levels of sugar in their products. They have also developed smaller packaging for all their markets. For alcoholic beverages, they have developed an Alcohol Advertising and Marketing framework in order to follow ethical practices.

3. Environment

CCA has been dedicated to meet their commitments on packaging, water, energy and carbon reduction to ensure minimal impact on the environment. In the same regard, they have committed to replenish 100% water used in production to share the vision of World without Waste in partnership with The Coca Cola company. They have also started with making efforts towards reducing carbon emissions by 25 percent for the final product that reaches the customer. They have also pledged to ensure that 60 percent of all their energy requirements is fulfilled through renewable energy and 50 percent of their packaging material comes from recycled plastic.

4. Our Community

CCA operates in 6 countries across diverse communities. They work across a range of community activities which include philanthropic grants and dedicated funds contributed from marketing activities to support grassroots sports and community development initiatives. They also provide aid to people impacted by natural disasters.

In 2019 the combined contribution made towards philanthropic activities by Coca Coca Amantis was a total of $5.2 million. This included causes like community development, health, education, infrastructure and sports.