Strategic Management

After reading the article on “Mumbai’s amazing Dabbawalas”, I have noticed that their logistics system is very similar to FedEx which deals with the four main hubs and each hub has a sub-hub etc. This made me think of how could The Mumbai Tiffin Box Suppliers Association expand and grow in the Logistics sector. After analyzing the article, we have concluded that the company cannot expand any more since it has limited Human resources which are descendents of soldiers of the legendary Maharashtrian warrior-king Shivaji. These people are the only ones physically capable of doing the job perfectly; this is due to their massive strength and collaboration with each other and considering the group system. If other services are provided by the company such as postal service, then other means of transportation is required such as motorcycles and cars which do not need the people from the certain tribes. This will expand their human resources in other subsidiaries and allow the soldier descendents to only delivery Tiffin boxes. However, their logistic system must be applied to all employees. One thing is the group system, where groups work competitively, and another thing is contributing to the company; each employee must contribute to the company (financially of course), these are just examples to maintain their strong logistic structure. This growth will allow the company to grow in geographical matters and have a significant market scope. I guess this is the story of the fast deliverable Dabbawala.

Nokia, a well-known cell-phone company has announced a release of a new phone (N-91) that has a combination of a 2.0 Megapixel camera, 4GB MP3 player and a cell-phone at the same time. According to Hamel this is clearly a Basis of Differentiation because Nokia have entered a new kind of product in the market that differentiates it from its competitors. This product is considered rare once it hit the market, however its rareness is for a short period of time just like all technological devices where the technology is directly imitated. That’s exactly what happened when Sony Ericsson have launched their MP3 phone. Will these new devices become replacements for MP3 players since cell-phones are dominating our lives at this day, or will it be a substitute for MP3 players? I certainly see an extinction of MP3 players in the coming years. Will you trade your I-Pod in for a Nokia N-91 or a similar device? That’s a question to think about.

This article talks about apple and the new software that allows windows XP to be installed in the new Intel-based Macs. According to the article this move will increase apples market share in the PC market; eventually hurting competition such as HP and Dell. Before this move people would look at apple as a substitute for windows since it offered a different operating system, now apple is a rival. Apple is known for its great hardware and software however compatibilty was a problem but with windows insatalled in an apple pc this will give it an advantage on new competition. Apple was lacking some switching costs, but with windows compatibilty in their PCs’ and Apples new Intel-based computers Windows customers will easily start using Apple.

McDonalds, a largely known corporation is seen to be the company which sells free smiles and care for its people. Well, after watching the movie “supersize me” and reading some articles, McDonalds seems to be an unethical, profit thinking corporation. Luring children from their young age to suck up their pockets until they grow, designing seats which are comfortable for only 20 minutes to increase customer turnover and creating food which doesn’t fill up your stomach for a long time so you can go back and eat from McD’s. That’s the real McDonalds People and it’s still popular like always. During the years McD’s was criticized from environmental issues to nutritional issues, since it has a history of non-market issues, McDonalds is being more aware of the non-market environment and trying to keep up their good image. Smart examples of this are by having charity boxes in each store, building hospitals to help the children and many more things. It cannot risk ruining its image because it would have a huge loss; what it does is compromise with any non-market issue it faces to continue sales. McD’s shareholders know that they are hurting the people however I guess money these days is more important than people.

After discussing about Barney’s theory, one point which was brought up in class was about Amazon.com where it hired the entire IT staff of Wal-Mart. Is it duplication, substitute or something else? Well I think its duplication because I think that duplication is not just using the exact same idea; however it is copying the core or base of the idea, and even developing it. Let’s say I am the first person to sell things online, and it was clothing for example. Well it would be a substitution to selling clothing on a retail store, however if anyone intended to sell anything other than clothing online then it would be duplication because the core idea which was selling products online is used by someone else.

When it comes to rareness with Barney, he defines it as possessing valuable resources that competing firms don’t have. Well, with today’s technology and high competition (because of Globalization), it is hard for a company to gain any rareness in its resources. As soon as an idea is put, competitors will imitate instantly. Also, it is very costly to have it. So a question is usually asked before this rare idea is implemented; is it worth it to invest all this money for it? Just like The GAP when it invested 10 million on a project which could be imitated instantly. This high growth of technology and competition could make it costly and not useful for companies to invest in such large projects. These projects will only give a rare resource which will last for a short period of time.

I asked Prof. Hunter once; If Hamel was saying that a business must always have a new innovative concept, then why is some businesses still practice the traditional ways? Well, Prof. Hunter said that it is costly for a business to keep changing, they only do it when there is a repetitive decline in profits, or the business idea is dieing out. He also said that a business concept starts with someone’s idea, so if some else in the company has a new innovative concept then the other person will usually disagree because he or she thinks the first concept is the best since it is his or hers. Basically there will be many differences in opinion and it would be hard to convince all managers and board of directors on the new innovative concept. Another point which was mentioned was that people do not like change even though it is good for them. After this conversation I was comparing a company with any person I might want to do certain things which my friends and family might disagree of, and this will also stop me from doing it just like a manager wanting to apply a new concept and everyone else disagrees. A person might need to move to a better and closer apartment to work, however he doesn’t because it is too expensive and he is used to his old apartment; this is just like a company which needs to change to an innovative concept but it doesn’t because it is sued to its old practices and it is too expensive to change to a new way.

For this BLOG, I decided to look up for an article that is related to my country. I found an article which talks about the competition of telecommunication service in Kuwait. The article is about two telecom companies Wataniya and MTC-Vodafone and how each has a high market share in the post-paid and prepaid services. The article also talks about how each competitor has its competitive advantage in its services. According to Porter, when firms are equal in size and have high competition, they believe that they can make moves without being noticed. By looking at the article, MTC-Vodafone has been declining in market share for the past three years because of certain approaches Wataniya has achieved. When Porter explained that there is a lack of differentiation in service or product, he explained that the buyer’s choice is largely based on price and service. That is why the article mentions that Wataniya telecome has 81% market share of the prepaid service, and MTC-Vodafone has 80% market share of the post paid service; this is probably because MTC-Vodafone is better in service for the postpaid subscribers and Wataniya is cheaper than MTC since it has a greater market share of prepaid subscribers. It is interesting to see how things can be based on this region and competition is quite strong with high rivalry in the telecommunications market in Kuwait.

Article site: http://www.hatiftelecom.com/news/kuwait.html