...A.i. To begin, defining the difference between behaving responsibly or/and ethically will help to address the gaps and eliminate question marks created by some businesses globally. Starting with behaving responsibly, business leaders should draw a bold line between achieving stakeholder's targets and acting responsibly toward their tangible or intangible resources. For instance, human capital should be treated equally and get paid fairly as well, along with making sure that targets are achieved with no harm to any party. It is about achieving organizational goals and personal aims of the workers at the same time without violating any rules, regulations or worker's rights. Businesses which applies the corporate social responsibility (CSR) shall be aware of the term 'Responsible behavior' where all parties win the situation with no issues and everyone feels responsible toward each other.
On the other hand, behaving ethically is not just a business terminology more than a human value where people were born with. Ethics are the governing rules and standards of our daily life decisions and actions. 'Ethics can be defined as the principles, values, and beliefs that define right and wrong decisions and behavior (Robbins and Coulter, 2009). It should be noted that ethics and legal requirements are different. Often, the real ethical dilemmas are choices among alternative that are all within the law but have different impacts on constituents.' (Daughton, 2010). Some others summarize it in the sense of knowing what is wrong and what is right to do which comes internally from inside each individual. It includes the rights and obligations between the businesses and their employees, customers, suppliers or even competitors in the market. it can be summarized into treating people equally and fairly without discrimination as the example of low-cost labor countries.
A.ii. Moving to the point of the great impact from increasing pressure to behave responsibly and ethically on the organizations', and the strategic decisions made because of that pressure, it has been proved that such a pressure will make the change that beneficiaries are looking for. For example, Samsung has recently re-called the newly released smartphone Note 7 which acknowledged to be unsafe for users due to batteries explosion. The company stopped producing and distributing the Note 7 as a part of its responsibility toward consumers, dealers and stakeholders with admitting its fault and compensating affected end users accordingly. On the other hand, Nike protected itself by doing unethical acts throughout the local contractors in Pakistan and that made it lawfully un-guilty. As we mentioned earlier that it is the originality which lead people or companies to accept or reject such actions.
In comparison of the two examples, Samsung proved to be responsible and ethical toward people and environment while Nike did the opposite by dealing with contractors who practice child labor to achieve their own goals without considering business ethics and responsibilities in the countries of their benefits.
We may understand that Samsung is aware of the risk resulting from losing reputation and customer's loyalty when -at the same time- they knew their competitors in the market are ready to even lose money to pull customers to their sides.
A.iii. 'Business is business' is the old-school methodology which used to be the success tool in the business world. Monopolized markets have been well-known as the best environment for such a practice where consumers have no choice but to deal with such businesses. Nowadays successful businesses understand the importance of customer satisfaction and opinion about their performance, products and services. However, it is not only the interest of the internal stakeholders but also the external ones like customers and suppliers. Moreover, it is the customers who lift up the company to make it profitable and goals achiever. (Jeurissen, 2000, p.p 821)
Business leaders should be aware about their obligations toward customers as they are committed toward shareholders for the same. Both parties are important for any success story and it is the company's responsibility to maintain a fair relationship with all parties to avoid all unethical practices might result from irresponsible actions. (Gothlin, J. 1999). Successful businesses are concerned with balancing commitments between internal and external stakeholders.
Therefore, satisfied employees will definitely bring more customers in return and as a result of the employees' sense of responsibility toward the company since they feel that they have been given all of their rights as human beings and treated fairly. So, well-adjusted wages, working hours, treatment, cooperation, appreciation, work load and safe environment are the most important factors for getting workers satisfied and to guarantee that responsibility, productivity and profitability will be the target of all parties within the company. On the other hand, and by achieving the above-mentioned targets, investors and shareholders will get their return on investment that they planned to approach from day one of investment which will give them the feel of 'Business is business' without knowing what is happening on backstage. (Gothlin, J. 1999). When Airbnb decided to make their work environment as the most attractive workplaces in the world, they put employees first as the success tool to achieve goals and targets. Hence, employees of Airbnb emphasized the collaborative work environment and company's fast-paced growth.
From my point of view, I personally agree and support the new implementation of the term 'Business is business' when all involved parties are satisfied and happy to some extent and that could be explained as win-win situation. Additionally, and worthy to mention that treating people responsibly and ethically is not just a business matter more than make it a principle of living in daily basis actions along with considering it as the key factor to run a successful business.
B. Discussing the challenges to be seen as acting responsibly and ethically as in obeying with laws and regulations, we must first differentiate that ethics is totally different than laws and regulations. For example, a company's policy may allow the management to pay employees less than what they deserve along with giving their employees more tasks and duties without benefits or compensations in exchange. In this case, the company has no illegal obligations by law but it is considered to be unethical and irresponsible behavior toward employees. From the point of view of some businessmen, it is simply the way in which one runs a successful business. (Jaunich, 2012)
The inequivalent level for ethical and responsible acting as in obeying with laws and regulations is one of the most vital factors which complicates the situation. If a company by law is allowed to call employees to report to office during off-days due to emergencies for example, and then not restricting it to reimburse them in exchange can be seen as an example of how far is law compared to business ethics.
One of the biggest fears is the weakness of laws and regulations set by the governing departments in the country where firms find it legal to treat workers unethically and irresponsibly as the laws stand behind and give them the support they need to act in such a way. Moreover, some companies would make sure that their top management are profit-oriented persons' prior employment. No emotional decisions should take a place in business world as generally understood by some managers and businessmen.
However, complying with the Aristotelian Take on Business Ethics which tells us that acts are not ethical if they are accidental. So, for example, if a manager decided to appreciate his group of employees after their demonstration or strike then it is not considered to be as an ethical or responsible act more than a reaction raised from feeling unsafe to avoid such a requirement. At this point, the factor in which managers should keep observing their groups to step on what is going on and what is required to maintain the business is a factor that could help applying law and regulations with respect to business ethics and responsibilities.
A.i. 'Non-Competitive market participants are "price maker", and controls/influences the price of the product it buys or sells.' (Jaunich, 2012). Porter's module may not be applicable on non-competitive markets where firms have the power to control the prices and products. Due to the limited number of firms in the market, customers have no choice but to buy from them at their prices no matter how good is the final product or service. Such markets run under the monopoly where the service or product is available from few firms at competitive rates but the same poor quality. At this point, price factor will be the reason for customers to stay with firm A not firm B.
One of the recent experiences in Oman was the telecommunication sector where only two companies provide mobile services. Service performance, prices, network quality, offers and packages where highly concerned by customers. Customers highlighted the lead time in service delivery and quality of delivered service. Prices seemed to be very high compared to the Gulf States countries where same network operator is available in more than one country in the same area offering much better prices and packages at the same time. Moreover, network coverage get lost in some areas within the capital which considered to be a failure of planning. Hence, customers planned to make a move to the other operator/service provider as a plan to push their existed operator to enhance the service level and performance. But that move seemed to be impractical due to price factor which is almost the same in both operators. Such a non-competitive market has nothing to do with Porter's module since the full power is on their hands not the customers' hands.
Such practices reflect the unethical and irresponsible acts toward external stakeholders in which firm don't consider customer satisfaction and service quality as a part of their strategic planning. In this case, customers are ready to immigrate immediately when a new comer enters the market in the future. Such a reaction will cost the existing firm to pay huge amounts of money to get back their former customers and to get their trust again at the first place.
My point of view that firms must be aware of the consequences from losing reputation and customers' trust at some point and the cost resulting from such reactions as seen in the example of Nokia and Research In motion. It is better to keep observing customers behaviour and understand their trends to work on satisfying their needs before anyone else in the market. By doing such a practice, firms could be always up-to-date to what customer needs from period to another. In addition, it helps firms to attract customers from other competitors as they see how dynamic and fast moving, growing and updated is the firm.
A.ii. Porter's five forces are extremely applicable for private sector businesses in the global market. Nevertheless, with some modifications and extensions, Porter's five forces could be applied for public sector organizations. All elements of Porter's framework can be replaced by some equivalents. To start with, bargaining power of service providers (Suppliers) can be clearly seen in Oman when it comes to healthcare service for example. People will look for the best institution to get their treatment from. even though it is one of the government public services in the country but still that people will look for the excellent service provider among the available ones. That also proves the concept of customer diversion to find the most comfortable and trust worthy service provider no matter under which sector they serve.
Moreover, bargaining power of parents (Buyers) is very applicable for public education sector in Oman at lease. Although that government schools are available at no-cost in the country, we still see parents moving their children form a public school to another for quality reasons most of the time. In this case, Buyers bargaining power is a key factor for education sector while knowing that buyers are paying nothing to get this service but yet they would love to get more in return for their children which applies the concept of pay less (or maybe nothing) and get more. Hence, and at this level, we could say it is not about accepting whatever service quality is provided at no-cost without considering the outcome of that acceptance.
One of the threats of substitute in the healthcare sector is the local treatments made free of charge to patients as they proved to be effective and efficient for some kinds of diseases. The history of the local treatments showed how people benefitted from such medications and got well like the example of broken leg or hand that can be fixed with a traditional technique using very basic materials and tools. Hence, this example evidences how a traditional medication can substitute the modern medicine in the public sector confirming the ability to apply Porter's module.
Additionally, healthcare in public sector can be challenged by low-cost clinics and pharmacies which may provide excellent service at an affordable cost by majority of the citizens. Such an event my force healthcare providers in the public sector to end up paying high operational costs with no one using the service provided. Due to lead time and service competence provided by healthcare sector in Oman, some people decided to go for paid services instead. This movement give an evidence of the threat of new entrance to the market and it should be taken in consideration for the upcoming future.
B. Discussing Grant's view, I personally support his highlighted though in terms of effective customer needs delivery. For any customer, the very first priority is needs fulfil with excellent service. Businesses which failed to do so has been left behind in the fast-moving market like the example of Nokia. Few years back, Nokia has been leading the mobile phones industry for decades with no fear from the existing competition by other manufacturers. However, customer expectation has no limit in the dynamic world. As a result, introduction of smartphones in the market was the new revolution in telecommunication industry. Apple and Samsung took the lead of the new revolution and extended it to go beyond customer expectation. Additionally, it was not only about introducing the new mobile phones other than bringing the next level of customer care where service performance is the key factor for success in such a field. Making the smartphones to be the tool that serves all user needs in terms of personal requirements like capturing moments, processing payments, making business deals and preparing for a travel from a scratch for example made a good enhancement in the lifestyle.
Businesses in which succeeded to deliver fast and efficient service to customers will benefit from the reputation in the market. Also, price factor and quality level are the most important elements in every purchase of any customer considering the value of money as the main priority for all customers. Customers ' in most cases ' will feel comfortable whenever they get the right answer for their inquires either before or after sale. So, staff who give the great first impression to customers from the first visit are considered to be the greatest asset for the business and the key factor for success.
Most situations in customers' satisfaction are based on the long-term relationship gained from the great service delivery and the quality of the product delivered at reasonable prices. Long-term relationships help companies to stabilize in the market and to maintain the reputation built over time. Lots of companies survived in the market because of the support gained from loyal customers.
One of the recent modules in customer satisfaction is to approach the emotional level of an individual customer. Making a customer feel like it is the best investment of money from company A make is the best feeling where customers can fall asleep in comfort. A lot of customers find it a nightmare wherever the feel cheated or they wasted their money in the wrong investment. Such a feeling make customers lose trust on that firm and bring them to the level where they get emotionally unstable. Many cases been recorded in which female customers refused to deal with certain companies because of a previous experience. It is the best area where service providers or goods sellers may make their customers feel secured by telling them that warranty policy is protecting their purchase and money spent.
Dell Inc. provided the best example on how to satisfy your customer needs and expectations by introducing the online assembly and shop where customers can build their own Laptops with the specifications they require along with the live assistance to help them combine the most efficient specifications together. 'Dell started out as a direct seller, first using a mail-order system, and then taking advantage of the Internet to develop an online sales platform. Well before use of the Internet went mainstream, Dell had begun integrating online order status updates and technical support into their customer-facing operations. By 1997, Dell's Internet sales had reached an average of $4 million per day. While most other PCs were sold preconfigured and pre-assembled in retail stores, Dell offered superior customer choice in system configuration at a deeply discounted price, due to the cost-savings associated with cutting out the retail middleman. This move away from the traditional distribution model for PC sales played a large role in Dell's formidable early growth'. (Strickland, 1999). After the product has been built and finalized, customers will get their devices on door step without paying any extra fees for the middle men distributes. The most attractive part of it is customers can enjoy the great after sale service online.
Such a success normally leads to shape a great reputation and help to make first-time visitor to be a loyal client in many cases. It also helps in increasing sales since the customer is comfortable with the effectively delivered service or good which make them feel happy to make business with the provider. Moreover, satisfied customers will always be referrals for others by using the word of mouth concept in marketing the service provider.
My personal thought is whenever a customer feels valued and well-treated by the provider of a certain product or service, he will likely visit the company again and again considering the relationship and loyalty toward the same.
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