Current studies show that at least a hundred stable economies exist globally and it is surprising to note that fifty-one of them are multinational corporations while just forty-one are states. The sales of the two-hundred best performing corporations amount to a quarter of the global economic activity meaning the revenues of just two-hundred multinational companies are greater than the economies of all states combined globally, including the powerful ones, such as the US, Britain, China, and Canada.
Research suggests further that global corporations are the largest employers since they are known to produce the best CEOs depended upon in advising governments on financial performance. The American institute for policy engaged in an extensive research to establish the exact number of multinational corporations and their global influence1. The researchers found out that over forty-thousand companies exist, with branches in various countries.
For instance, it was established that Philip Morris Company has a financial strength that surpasses that of New Zealand. The companies are never interested in helping the local poor instead they have devised new systems, including interlocking production, consumption, and financial arrangements, which serve only one purpose of fulfill the interests of the few rich individuals while the rest of the global society languishes in extreme portray.
From this analysis, I take the stand that global corporations have structural powers, which are misused in sustaining a defective economic system that does not respond to the needs of the poor2. For instance, the recently global financial system challenged many states forcing them to bail out their best performing local companies. It is surprising to note that the structural powers of MNCs helped them in sailing through the hard economic times that faced many actors, especially governments.
Multinational corporations are blamed for enhancing social and political problems, cultural insensitivity, and environmental degradation mainly because they are in a position to influence decisions. Even though a number of realist scholars are of the view that the new structural powers of MNCs are insignificant without the existence of the state, a number of MNCs are very powerful to an extent of shaping both local and foreign policies.
For instance, a number of American MNCs force the home government to slap economic and political sanctions to a non-cooperating state in the third world, especially the one that fails to adopt liberalization policies demanding for the opening up of markets.
I support the view of liberalists that appreciates the fact that states are important in enhancing business interactions, but their role is minimal, as far as business operations are concerned. Scholars holding this view suggest further that the state only plays a major role of providing an enabling environment that allows people to fulfill their objectives3.
In this case, multinational corporations have adequate powers to control the sectors and the industries in the global economy. In fact, powerful multinational corporations exist across the world with adequate powers to influence the policies made both locally and internationally4.
It is concluded that multinational corporations have adequate structural powers that are often employed effectively in influencing the quality of decisions both locally and globally. Even though realists are opposed to this idea, the fact remains that MNCs hold enormous powers as far as global decision-making is concerned.
References
John Dunning, An overview of relations with national governments, New Political Economy, 3.2 (1998): 283.
Peter Dicken, Global shift: Mapping the changing contours of the world economy (London: Sage, 2011): 23.
Coe Neil, Economic geography: A contemporary introduction (Malden: Blackwell Publishing, 2007), p. 62.
Andrew Walter, Do they really rule the world? New Political Economy, 3.2 (1998), p. 289.
The green movement is concerned with the conservation of the environment from the manufacturing industry emissions (Chittom, 2008). The movement has gained popularity and many corporations in the US are moving their manufacturing operations to offshore locations.
These locations are situated outside the US and they involve full manufacturing or assembly characterized by low labor and low cost, as well as the availability of cheap raw materials. The corporations may either decide to import or export the final products to the manufacturers host country.
There are various reasons why most of the US manufacturing corporations are shifting their operations to off shoring. These companies fear the litigations and regulations associated with product liability.
The corporations also fear the emerging litigations trends related to the developed green products regulations. For example, the use of nano materials and phthalates has high litigations as they are harmful to the environment if not well handled and this could be a liability to the company. Therefore, the major cause and reason is the fear of product liability suit associated with green movements.
However, there are negative implications that arise as a result of the green movements and these may have long term negative consequences. Based on a survey report by Accenture, most of the companies that have offshored their supply and manufacturing operations have reported that this has hurt the capacity of meeting the expectations of their consumers (Barber, 2011).
Most companies are unable to meet the demands of the customers unique products expectations since they cannot make timely delivery and maintain competitive costs and low operational inventories.
Although the movements advocate for the environmental conservations, the manufacturing industry is most likely to be affected as most of the companies would divert their companies to other areas (Lewin Massini & Peeters, 2008). This would reduce the rate of foreign direct investments because of the regulations put in place by these green movements.
New technologies like the nanotechnology would not be advanced because of the fear of litigations that may arise based on product liability. It also creates unemployment since when the manufacturing operations are offshored, the opportunity of creating new jobs is eliminated thus unemployment.
The companies have responsibility to both the global community and the U.S as their manufacturing operations. The companies have the responsibility of conserving the ecosystem as well as the health of the people in the society (Chittom, 2008).
Through the observations of the green movement regulations, the companies would be in a position to produce products that are environmentally friendly and that protect the ecosystem. In terms of global competitiveness the companies would be able to ensure that operate they keep their innovations and leadership to themselves and their operations.
Given that a company was violating the law before the inception of regulations, the company is liable to take actions against its deeds. This could be achieved through proper follow up of the regulations and putting into place mechanism that follows the regulations.
The company has the responsibility of coming forward and resolving the issues after the codes comes into existence. This would be approached by contacting the relevant authorities to ensure that the product liability regulations are followed for the human and the environment safety measures.
For instance, proper mechanism for dumping the toxic wastes would be followed and through active approach fines and imprisonments would be avoided (Business Link, n.d).
Green movements are important as they help in ensuring the safety and cleanliness of the environment. This has led to off shoring by the US companies for fear of litigations. However, they can lead to the transfer of technology to other states and unemployment.
The green movement is concerned with the conservation of the environment from the manufacturing industry emissions (Chittom, 2008). The movement has gained popularity and many corporations in the US are moving their manufacturing operations to offshore locations.
These locations are situated outside the US and they involve full manufacturing or assembly characterized by low labor and low cost, as well as the availability of cheap raw materials. The corporations may either decide to import or export the final products to the manufacturers host country.
There are various reasons why most of the US manufacturing corporations are shifting their operations to off shoring. These companies fear the litigations and regulations associated with product liability.
The corporations also fear the emerging litigations trends related to the developed green products regulations. For example, the use of nano materials and phthalates has high litigations as they are harmful to the environment if not well handled and this could be a liability to the company. Therefore, the major cause and reason is the fear of product liability suit associated with green movements.
However, there are negative implications that arise as a result of the green movements and these may have long term negative consequences. Based on a survey report by Accenture, most of the companies that have offshored their supply and manufacturing operations have reported that this has hurt the capacity of meeting the expectations of their consumers (Barber, 2011).
Most companies are unable to meet the demands of the customers unique products expectations since they cannot make timely delivery and maintain competitive costs and low operational inventories.
Although the movements advocate for the environmental conservations, the manufacturing industry is most likely to be affected as most of the companies would divert their companies to other areas (Lewin Massini & Peeters, 2008). This would reduce the rate of foreign direct investments because of the regulations put in place by these green movements.
New technologies like the nanotechnology would not be advanced because of the fear of litigations that may arise based on product liability. It also creates unemployment since when the manufacturing operations are offshored, the opportunity of creating new jobs is eliminated thus unemployment.
The companies have responsibility to both the global community and the U.S as their manufacturing operations. The companies have the responsibility of conserving the ecosystem as well as the health of the people in the society (Chittom, 2008).
Through the observations of the green movement regulations, the companies would be in a position to produce products that are environmentally friendly and that protect the ecosystem. In terms of global competitiveness the companies would be able to ensure that operate they keep their innovations and leadership to themselves and their operations.
Given that a company was violating the law before the inception of regulations, the company is liable to take actions against its deeds. This could be achieved through proper follow up of the regulations and putting into place mechanism that follows the regulations.
The company has the responsibility of coming forward and resolving the issues after the codes comes into existence. This would be approached by contacting the relevant authorities to ensure that the product liability regulations are followed for the human and the environment safety measures.
For instance, proper mechanism for dumping the toxic wastes would be followed and through active approach fines and imprisonments would be avoided (Business Link, n.d).
Green movements are important as they help in ensuring the safety and cleanliness of the environment. This has led to off shoring by the US companies for fear of litigations. However, they can lead to the transfer of technology to other states and unemployment.
The case raises some serious ethical concerns. Considering that Erikson has a good reason to suspect that the activities of the Fast Grow Corporation have caused extremely dangerous contamination of the environment, it is his duty as a member of a democratic governmental apparatus to continue his investigation. Since he did not discontinue his activity immediately, it is safe to assume he also considers it his duty to serve the public interest in this situation.
Moreover, considering the case is linked to the new type of fertilizer, its use can likely cause ecological problems on a much wider scale if the company chooses to start selling it disregarding the potential risks. The contamination also indicates the lack of proper testing on the part of the Fast Grow. It is important to expose the issue since it might be connected to corrupt scientists or simply inefficient testing procedures. The potential implications of the issue call for immediate action and deep investigation which will allow Erikson to figure out how severe the problem is. Since it is also entirely possible that the contamination is unrelated to the Fast Grow activities, identifying the true source of the problem should be a priority.
However, approaching this issue head-on would be unwise. If Erikson continues his activity disregarding the orders from a superior, he is likely to lose his position and the ability to deal with the problem. Thus, the situation warrants a more subtle approach. There are several ways to tackle the issue. The first is to become a whistleblower. Erikson cannot openly contact the press since it will get him fired and possibly cause a backlash from the supporters of the Democratic Party. By leaking the whole story to the media, Erikson can allow the journalists to handle the further investigation. At the same time, he will be more or less protected by the journalist ethics which will hopefully prevent them from disclosing the source of the
information. However, there are a number of issues with this approach. First of all, journalists are not qualified to deal with the environmental issues. They may misinterpret the data or fail to contact the appropriate specialist who might help them. Secondly, the journalist ethics are not infallible, and there is no guarantee that one of the numerous sides involved in the situation would not bribe them. Finally, if the Eriksons involvement is exposed, he will definitely lose his position. It is also worth noting that the information on the dangers of the fertilizers can turn out to be false. In that case, disclosing it to the media will harm both the company and his department for no good reason. Considering all of these factors, it is unwise for him to shift all of the responsibility to the journalists.
Another possible solution is to try and negotiate a deal with Simpson. Erikson can guarantee that the results of the investigation will be available only to the workers of their department. In exchange, his superior will allow him to continue his work. Simpson is likely to be interested in the results since any problems identified can be used as a bargaining tool in the political struggle that is clearly going on. Considering the open government politics of the current mayor exposing his involvement in the attempts to prevent the disclosure will definitely harm him. On the other hand, if he receives the information about the issue, it will give him a powerful tool to influence any of his supporters involved in the project, solidifying his power. Whether Simpson wants to support Fitzgerald as a new mayor or help the current one keep his position, the results of the investigation will be useful. Erikson will get a chance to identify the source of the problem and easily resolve it provided it turns out to be unrelated to the Fast Grow. However, such approach would mean that there is a good chance that the results of the Eriksons work will never be presented to the general public. That makes continuing the investigation useless since even if it discovers the root causes of contamination, there would be no way to resolve the issue.
Finally, the approach which I view as preferable is to try and seek support within the department. Since Eriksons superiors are too caught up in the power struggle to notice an extremely severe issue, it seems wise to seek conscientious individuals among the workers of the department. Ethics dictate that Erikson must explain the risks associated with helping him, but encourage his colleagues to do their job properly and get to the root of the issue. With the support of those people, he will likely be able to continue his investigation efficiently and complete it successfully. The issue with this solution is that there might be no likely supporters among the Eriksons subordinates. Moreover, approaching the potential supporters he risks being reported to Simpson. However, in this situation Erikson has a great ability to mitigate the personal risks by picking the candidates himself. With the limited resources and the need for secrecy, conducting the investigation will be problematic. If the results point to Fast Grow as the cause of the contamination, the only way to resolve the issue would be to leak that information to the press. That will further put Eriksons personal well-being at risk. But overall, this approach seems to be the best possible solution which allows Erikson to fulfill his duty as a government official without exposing himself too much, provided he is able to find supporters.
The United States of America is a melting pot, known worldwide as the leading diverse nation and the land of opportunity. Globally, women in government positions often face many ethical issues stemming from the inequalities pervading gender roles, leading to pay differences, and disparities in the occupation of leadership positions. The Civil Rights Act of 1964 was enacted to promote workplace diversity by championing inclusivity (Grissom, 2018). Implementation of the Dodd-Frank Wall Street Reform Section 342 aimed to facilitate the empowerment of diversity within the financial services industry (Evanoff & Moeller, 2014). This financial statute did not apply only to private financial entities but also to public financial agencies. Statistics from the Center for American Women and Politics indicate that women make up 51% of the U.S. population, with only 29% representing state legislative seats, 24% in the U.S. Senate, 27% in the House of Representatives, and 30% statewide elected executives. These numbers are even lower for women of color, with only 18% serving as statewide elected executives and 26% female state legislators. The Civil Services Reform Act of 1978 created Senior Executive Services (SES) federal civilian ranks GS-15 and above. Currently, there are over 8,000 positions but there are huge disparities in how they are occupied.
Research Questions
RQ1: How does coaching affect African American womens perspectives on the impact of mentoring on career development and success in government agencies?
RQ2: How do African American women who want to be in executive positions perceive the impact of the absence of mentoring on their career advancement and success in government agencies?
RQ3: How do race and gender impede African American womens experiences in senior executive roles?
Theoretical Framework for the Study
The study will be grounded on a transformative worldview, which indicates the need to connect research inquiry with politics to confront social oppression at different levels. The small proportion of African American women in senior executive positions is a socio-economic inequality that should be addressed (Hague & Okpala, 2017). As a minority group, black women appear to encounter workplace bias and discrimination based on race and gender. It is critical to evaluate the extent to which coaching programs help women rise to leadership and the fairness in their implementation. The theoretical framework is derived from the Black Feminist, Social Role, and Critical Race theories.
The Black Feminist Theory emerged from the sustained marginalization propagated in and by the feminist movement. It captures the intersection of gender and race recognizing the oppressive nature of the social constructions based on the concepts (Hague & Okpala, 2017). The ideology developed during the abolitionists era, which was intended to end slavery. At the time, African American women were denied rights as citizens and they faced a system designed to destroy them as women and humans. Born as a slave, Sojourner Truth is the abolitionist and liberal reformer recognized as the initiator of the black feminist ideology. She argued that servitude denied black women motherhood, innate feminism, and protection from exploitation. The Critical Race Theory captures her views by indicating that social division of labor characterizing a society, such as slavery, contribute significantly to the shared gender stereotypes.
The Black Feminist and Social Role, theories have contributed significantly to the contemporary views about African American women living and working in the United States. Double jeopardy and intersectionality are connected to the ideology in which the latter evaluates the notion that gender, race, and social class overlap to make a model giving black women unequal levels of power and privilege (Hague & Okpala, 2017). Assuming that African American women face similar social issues, the Black Feminist theory will help to determine the extent to which the interlocking concepts contribute to the unique challenges facing the women of African descent in rising to top leadership positions. As a jurisprudence framework examining culture and society in relation to the categorizations of law, race, and power, the Critical Race theory will clarify governance issues around the problem.
African American Women in Executive Positions
Women accounted for approximately 47 percent of the U.S. labor force as of 2019 but only 40 percent held management positions. Studies indicate that gender bias against women, commonly been referred to as the glass ceiling, has contributed to the problem (Erskine et al., 2021). However, African American women and those from other minority communities have been affected more because their white counterparts held approximately a third (32.3 percent) of the leadership positions (Women in Management, 2019). Statistics indicate that only 2.5 percent, 4.0 percent, and 4.3 percent of Asian, Black, and Latino women respectively, hold leadership positions in U.S. corporations. The following chart indicates the proportion of American women occupying leadership positions by race:
Fig. 1: Proportion of American Women in Corporate Leadership by Race
Fig. 1 visualizes the racial disparity in the women occupying leadership positions in American corporations. It indicates that minority groups, including African American women, face significant challenges in efforts to rise through the corporate ladder. Segregation based on race appears worse than gender discrimination, which affects black women immensely because they experience both.
Research Done on the Topic
Various researchers and scholars have studied the problem to determine the causes, effects, and potential remedies. A study by Barron (2019) reveals that only a sparingly 0.2 percent and 1.2 percent of African American women were in chief executive officer (CEO) roles and executive or senior-level roles respectively within a 500 Standard & Poors (S&P) organizations in 2015. The researchers indicated that underutilization of black womens lived experiences by organizational and human resources in recruitment, diversity and inclusion, career development, and succession planning contributed to the problem. Black ceiling supported by the influential institutional logics of white supremacy and patriarchy has also contributed to the problem by viewing Afro-Diasporic women as multiple outsiders (Erskine et al., 2021). The unique challenge has compromised the well-being of women of color in the corporate world, making it challenging for them to navigate environmental and relational phenomena, such as social closure, emotional taxation, white fragility, and white privilege. Most of the existing studies focus on the factors preventing African American women from advancing to top executive positions. There are limited studies addressing the solutions, a research gap that should be addressed. It is also critical to extend the existing literature by evaluating the impact of coaching on employee career success and how it can address the race and gender gaps restricting black women to lower-level jobs.
Topic Relevance
The topic is important because it identifies a critical social problem that should be addressed because the dismal representation of Afro-Diasporic women in top corporate positions is a minority population disparity. Erskine et al. (2021) report that no African American woman appeared on the Fortune 500 or S&P 500 CEO lists in 2017 after Ursula Burns stepped down as the Xerox CEO in 2016. Additionally, only the Executive Vice President for United States Stores at Home Depot, Ann-Marie Campbell, appeared on Fortunes 2017 list of the most influential women in business. The unique challenges facing the black women have forced them to face their careers with an attitude of survival, endurance, and coping, rather than the desire to flourish and rise to leadership. A study evaluating the perceptions of women facing discrimination about coaching and career development success will help to determine whether assigning mentors to them can address the problem. The study will be qualitative, collecting data through interviews to gain an in-depth understanding of the underlying issues. The findings will extend the literature and extend the understanding of race and gender-based disparities in the corporate world.
Conclusion
There are significant disparities in the occupation of leadership positions in U.S. public and private corporations. The inequalities exist despite the passing of the Civil Rights Act of 1964 aimed at promoting workplace diversity by enhancing diversity. African American women are among the most affected group because the discrepancies have gender and race facets in which males are more privileged than females, while whites are better placed to rise to leadership positions compared to the minority populations. The Black Feminist Theory is the proposed theoretical framework for the study because it captures the intersection gender and race as concepts leading to oppressive social constructions. Experts indicate that coaching can help employees realize their professional goals and grow to occupy leadership positions. However, there are concerns that the glass ceiling and similar hindrances will continue to impede women, especially the African Americans, from rising to the top of the corporate ladder. Therefore, it is critical to evaluate the perceptions of working black women about coaching and career development and success. An interview with professionals who have mentors and those without mentorship can shed light on the matter. The study will also help to address gaps in the literature about the gender and racial discrepancies.
References
Barron, M. (2019). Senior-level African American women, underrepresentation, and career decision-making. Walden University.
Women in management: quick take. (2019). Catalyst. Web.
Evanoff, D. D., & Moeller, W. F. (2014). The DoddFrank Act: An overview. In D. D. Evanoff, & W. F. Moeller, DoddFrank Wall Street Reform and Consumer Protection Act: purpose, critique, implementation status and policy issues (pp. 1-30). World Scientific.
Grissom, A. R. (2018). The alert collector: Workplace diversity and inclusion. Reference & User Services Quarterly, 57(4), 242-247. Web.
Hague, L. Y., & Okpala, C. O. (2017). Voices of African American women leaders on factors that impact their career advancement in North Carolina community colleges. Journal of Research Initiatives, 2(3), 1-15. Web.
Transnational Corporations (TNC) are a major part of the international trade and the global market. In the last decades, they have expanded their influence and became much more powerful, particularly by gaining support from respected and influential international organizations, such as the World Bank, the World Trade Organizations, and of many governments ( International Corporations par.1-2).
However, recently the TNCs have been increasingly evaluated by the public health impact they have. While the TNCs do create opportunities for positive health consequences and go the extra mile to project a positive image, they also have a history of practicing policies that cause or ignore damage to the environment and human health, often concealing it with marketing campaigns with misleading messages. This is further enforced by international trade agreements that provide increasingly more power to the TNCs, allowing them to ignore past restrictions on their businesses (Baum & Anaf 1).
Amazon.com, Inc. is an American company, specializing in on-the-line computing and E-commerce, which is trade and facilitation of trading relationships through their computer network. While it is still seen as an American company, dealing in a wide variety of goods and services, since its inception it has diversified into other countries with various national sites and is putting a lot of effort into increasing its presence in the global market.
However, since its founding in 1994, Amazon.com has steadily attracted media attention through numerous controversies, with examples such as accusations of monopolistic practices. A severe number of these allegations concern mistreatment of workers in their workplaces, adverse treatment of individual sellers, or the fact that it hasnt published to date any publicly available reports on its contributions to climate change.
A lot of criticism comes from Amazons attitude towards its warehouse employees. For example, in 2011, Pennsylvanias news agency interviewed twenty Amazons workers and recovered a lot of information about unsafe conditions of the warehouses and physically and mentally debilitating employment practices. These included extreme heat inside of the buildings, strenuous workloads, regular deactivation of air conditioning for economy purposes, and conditions so inadequate that the company had arranged for regular ambulance pick-ups for people who had passed out in the workplace.
Other unhealthy medical practices included being fired over health issues, such as breast cancer, management by stress and through unattainable work goals, and general sweatshop conditions (Soper 1-15). This situation was recorded in several of companys workplaces, including those in the United Kingdom, with the investigation by BBC News coming to the conclusion that working in their warehouses could cause mental and physical illness (Amazon Workers Face Increased Risk of Mental Illness par.1-18).
Amazon has also been criticized for the products it has been willing to host on its sites, which had been deemed dangerous to the public mental health. This was exemplified in the 2010 controversy about Amazon selling the book The Pedophiles Guide to Love and Pleasure: a Child-lovers Code of Conduct (Saint par.1-2)
Another example of Amazons policies that allude to the damage it might have on the health of people is its adamant refusal to publish its emissions data. While having implemented some green policies, such as the use of renewable energy in limited areas, as well as having very basic recycling procedures, the company refuses to adopt the policy of transparency about the impact it has on the environment, and the health and safety of people (Kaufman par.3).
In conclusion, at the present moment, Amazon is only beginning its path as a transnational corporation. However, it has already shown its desire for high profits at low costs, even at the expense of the physical and mental health of its employees, and the environment. While the company has made some steps towards healthier company policies, those were made under pressure from the media and courts, so only time will show if Amazon will be willing to advance in those areas on its own.
Baum, F. E., and J. Margaret Anaf. Transnational Corporations and Health: A Research Agenda. International Journal of Health Services 45.2 (2015): 353-62. Web.
International Corporations. n.d. Web.
Kaufman, Alexander C. Amazons Environmental Record May Be As Bad As Its Work Culture. 2015. Web.
Saint, Nick. Amazon Caves: Pedophile Guide Pulled From The Kindle Store (AMZN). 2010. Web.
The McKesson Corporation (also known as McKesson) was founded in 1833 as an importer of botanical drugs. As of today, it is a Fortune 14 corporation that delivers pharmaceuticals, medical supplies and healthcare information technology and operates in two segments: ethical/proprietary drugs and equipment and beauty/health care products in North America and beyond it (McKesson, 2014, p. 2). According to the company, it aims to distribute pharmaceuticals, technology, or other healthcare-related products that make healthcare safer while reducing costs (McKesson, 2014, p. 3). The company also develops new technologies and provides those to other hospitals and health systems. Sales to customers consolidate approximately 48% of the companys revenues and research and development costs are $456 million (McKesson, 2014).
Addressing Healthcare Needs
The company uses cloud-hosted population risk management and analytics of health care data that allow it to generate predictive modeling techniques for individual or collective customers (McKesson, 2017). Using clinical and financial data, the company evaluates any possible risks and needs of a customer and creates a health plan. With this health plan, clients can see whether there are any risks for hospitalization or if they need to implement any health care interventions (McKesson, 2017).
The companys website also provides numerous articles, blog entries, and personal opinions about health care management, prevention of readmissions, measurement of risks, and health care business predictions for 2017. For example, the president of the company points out that issues critical to health care include the development of data, prevention of diseases, and make health care professions more attractive (McKesson, 2017). The company develops various types of health plans, including InterQual, HEIDS, and MedVentive: each of those plans addresses specific needs such as evidence-based clinical decision support, quality of care, data sets to measure the quality of care, and management of high-risk patients (McKesson, 2017). As can be seen, the company approaches the problem of the aging population by developing technologies, frameworks, and plans that providers and payers can use.
Network Growth
The network growth in the USA is satisfactory and stable: the company distributes its services and wares in all 50 states in retail pharmacies, health systems, and hospitals (McKesson, 2017). Furthermore, the company also operates in Canada via its affiliate McKesson Canada. It should also be noted that the company provides international logistics and services in 14 countries (including France, the UK, Ireland, New Zealand, etc.).
The strategic goals in network growth can be the following: the company needs to continue its further expansion in Europe, as well as in the USA and Canada. Celesio (the companys European affiliate) does not operate in Spain, Poland, Finland, the Czech Republic, Romania, and several other countries that are members of the European Union. The company is not present in the Eastern European market (Republic of Moldova, Belarus, Ukraine, etc.), in Russia, and the Middle East/East Asia markets (Celesio, 2017). Thus, the company needs to focus on expanding in Europe, as well as in small towns and rural areas in the USA and Canada. At the same time, the company acknowledges that it is exposed to certain risks (political instability or currency fluctuation) due to its presence in the Western European market (McKesson, 2014). Operations that take place outside the USA can be affected by changes in trade protection laws, policies and measures and other regulatory requirements which might negatively influence the network expansion (McKesson, 2014, p. 15).
Nurse Staffing
The company provides various technologies to address the issues in nurse staffing. For example, it provides its customers with a program called ANSOS, a web-based manager of assignments and workload that allows hospitals and clinics to transform schedules to create a more patient-centered approach (McKesson, 2017). The program is based on nursing documentation, provides patient assessments, and allows creating a flexible staffing environment (McKesson, 2017).
The company also advises reducing unnecessary tasks and interruptions that adversely influence nurses and their ability to provide quality care (McKesson, 2017). The corporation suggests using a patient tracking system to avoid unnecessary telephone calls and help nurses acquire information more quickly. If clinics and hospitals want to reduce losses, they have to provide nursing leaders with accurate predictive, real-time and retrospective data (McKesson, 2017). Analyzing existing data to provide and support decision-making is often more effective than making a rapid decision when there is no time left. The companys goals are to engage the approaches they claim to be efficient. Moreover, the company also needs to provide more information about available jobs for nurses at McKesson in the USA since their website mostly contains information about positions in Canada (McKesson, 2017). The company also warns the website users that unauthorized career opportunities are presented by individuals who claim to be McKesson representatives but are not. The company needs to address the fraud so that its reputation in workforce management does not come to harm.
Resource Management
The companys resource management is effective and consists of various programs that support human capitals development and improvement of employees performance. The company aims to foster employee development and align personal aims and objectives with business goals (McKesson, 2017). Employees are encouraged to suggest programs and frameworks that will help the company maintain environmental sustainability or improve their internal processes (McKesson, 2017). Furthermore, the company should continue offering its employees training at the McKesson Center for Learning, which positively influences the allocation of resources.
The company admits that it is dependent on sophisticated information systems. This is the reason why McKesson is mainly focused on maintaining confidentially of the information it possesses; the corporation invests significant capital in the research and development to support and protect the Technology Solutions segment (McKesson, 2014). The company should continue investing in research and development since more hacker attacks and security breaches are likely to happen.
Customer Satisfaction
The company uses patient satisfaction surveys to evaluate customer satisfaction. It also provides different software for their customers so that clinics and hospitals can evaluate patients satisfaction as well. McKesson (2017) does not explicitly state whether it uses its software to test customer satisfaction or engages other approaches. However, the companys affiliate Health Mart was ranked highest in customer satisfaction in a study conducted in 2016 (McKesson, 2017). The J.D. Power 2016 Pharmacy Satisfaction Study was used to evaluate customer satisfaction with chain drug pharmacies in the USA (McKesson, 2017). Thus, the company relies both on internal and external programs to evaluate its customer satisfaction.
The company should develop an internal customer satisfaction program that will include various types of reviews, such as complaints, suggestions, and comments. Providing electronic and paper surveys is also an option. Although the company admits it uses such types of surveys, it does not provide information about the results of these surveys, which can lead to skewed data since there is not enough transparency. Text message reminders, as well as online refills, are suggested by the company to its stakeholders as possible tools for evaluation of customer satisfaction. The company can use such tools as well to measure customer satisfaction and see whether customers experience needs any interventions.
The modern understanding of the American dream and success is closely associated with the idea that successful people follow a unique lifestyle full of pleasures and comfort. This idea is closely correlated with the vision that modern successful people pay much attention to gadgets and different mobile devices because their success depends on sharing a lot of information typical for the digital era. The Huffy Corporation chooses to focus on the promotion of the opposite ideals while associating the successful lifestyle with the pleasure of riding bicycles as the pattern for the effective advertisement. The Huffy advertisement published in Good Housekeeping attracts the female readers because it supports the idea of the successful lifestyle full of such pleasures as riding the trendy bicycle while opposing these pleasures to the modern focus on gadgets as the symbols of the modern digital era. To understand the reasons why the Huffy advertisement published in the magazine for women is effective to evoke the consumers interest, it is necessary to analyze the magazines ideal reader; such features of the advertisement as the color, format, content, layout, and rhetorical elements; and evaluate the advertisement within the context of Good Housekeeping magazine.
The ideal reader of Good Housekeeping is the successful woman aged 25-45 years who has the family and lives in harmony with herself and the world. This woman is white, or she can be African American, Asian, and of the Hispanic origin, as it can be stated referring to the magazines materials. The womans religion does not matter. The ideal readers job is part-time, without references to the profession because this woman can balance the work and housekeeping. The ideal female reader prefers to spend much time creating comfortable conditions for her family, and she likes to spend much time with relatives.
To sell such a product as a yellow-pink trendy bicycle successfully, the designers focus on the advertisements color scheme, format, content, layout, and rhetorical elements to draw the audiences attention to the advertisement. Referring to the Huffy advertisements format, it is necessary to note that it is the print advertisement based on the principle of analogy. While discussing the advertisements layout, it is necessary to note that the illustration takes most of the advertisement when the caption is presented in the upper right corner. The main female character is depicted in the foreground, and the other people and buildings are depicted at the background. This technique makes the reader pay attention to priorities.
One of the most important features is the color scheme. Dark purple and violet colors which are associated with the mysteries and fantasies are used as dominating ones. They serve as the perfect contrasting background to represent the bright yellow-pink bicycle. This approach adds to the advertisements content, which presents the woman with a bicycle in the background of gadget-like buildings. These fantastic objects catch the readers attention and make them focus on the caption: Whens the last time an app blew wind through your hair? . The woman seems to speak these words and be happier than the mobile users in this fantastic world typical for the digital era.
Pathos and ethos are used by designers to attract readers. The appeal to the female readers emotions is based on the opposition between the woman and the other persons in the advertisement. The reader is expected to focus on the invasion of mobile technologies and to choose the path of riding the bright bicycle. Ethos is used with references to the companys logo and caption because Huffy is one of the most reputable producers of bicycles.
Referring to the context of the magazine, it is possible to note that the advertisement can be chosen to be published because it draws the readers attention due to its impressive color scheme and focuses on the principles of the successful lifestyle. Furthermore, the advertisement meets the audiences needs while proposing the variants to have more fun and entertain oneself. As a result, the Huffy advertisement can be discussed as successful because it creates a striking effect, manipulates the readers expectations, and accentuates the idea of the happy life full of pleasures.
They discussed and analyzed Huffy advertisement, which is designed to promote the new model of a bicycle can be discussed as eye-catching and rather effective because of its associations with the mystery and fantastic elements. Thus, the advertisement meets the needs of the magazines ideal female readers who are focused on finding ways to spend time with the family and have more fun. The analysis of the advertisements color, format, layout, and used rhetorical elements to demonstrate that the advertisement attracts the readers attention without references to the concepts of race, gender, and age. Thus, the Huffy advertisement can be discussed as rather successful because of using the play of contrasting colors, images, and concepts while presenting the thought-provoking message associated with the idea of the peoples successful lifestyle.
OPTIC Analysis
Image Title: Huffy: Still Your Ride
O The advertisement represents the young African American woman using the bright yellow-pink bicycle for the night ride in the world of digital technologies.
P The female appears as separated from the other people locating at the background. She holds the bicycle and helmet. The dominated colors are violet and purple, and the yellow-pink bicycle is in contrast to them. The represented buildings are gadget-like and fantastic.
T The title Huffy: Still Your Ride suggests that Huffy proposes good products for riding, such as bicycles, with which your ride is usually comfortable or still. The caption states: Whens the last time an app blew wind through your hair? , and it means that it is more reasonable and enjoyable to ride bicycles to feel the wind in the hair instead of focusing on new applications to have some fun.
I Such parts as the female character, the bicycle and helmet, and their colors add to each other and create a positive mood of happiness, satisfaction, and pleasure of riding with vivid emotions. However, this emotion is accentuated with the focus on the contrast between the dark purple digital environments typical for the people at the background and the bright yellow bicycle used by the woman.
C The designer could focus on demonstrating the trend to ride stylish bicycles as opposed to the trend of choosing applications and using gadgets typical for the digital era.
Selecting Ads for Analysis:
I selected Readers Digest, The New Yorker, and Good Housekeeping because they are read in my family. I focused on many advertisements in Good Housekeeping.
I am a regular reader of Readers Digest. The other magazines are read in my family.
I found such patterns as a lifestyle, healthy diet, fashion, luxury, care, beauty, and comfort.
I focused on the lifestyle because the advertisements are vivid and promote the ideals of the American dream and success.
I selected the advertisement for the Huffy products because it is fantastic and associated with the ideals of the persons successful lifestyle.
Inside the Ad
The advertisement is about the modern young woman using the bicycle in the world of high technologies.
The advertisement evokes positive associations related to the opportunity to ride a bicycle in the busy world while following the trends.
The Huffy bicycles are promoted. However, the viewer can identify the product during a few seconds because of observing many gadgets in the background. The product can be identified with the help of the logo and slogan.
A woman and pairs of persons appear in the advertisement. The woman holds the bicycle and helmet. The gadgets appear as buildings in the advertisement.
The advertisement represents the night, and it can be the fantasy associated with the modernity or fantastic future. The environment is the quay of the river with many gadget-like buildings.
The advertisement serves to persuade that the focus on mobile devices and applications cannot provide the person with the feeling of the real wind in the hair, and the process of riding a bicycle is a good alternative to finding apps.
The main female character feels satisfaction while using the bicycle. She demonstrates her pleasure associated with using the bicycle instead of having gadgets. The other characters can share the advantages of using applications.
The female character and the product are in the focus of the camera, but they are left-sided to demonstrate the quay in perspective. The advertisement demonstrates the right choice made by the female in the foreground and false choices made by the persons appearing at the background.
About the reader, the main character is depicted on the left. About each other, the background characters are grouped in pairs. About the physical environment, all the characters are on the quay, observing the gadgets on the left and the river on the right. About the product, the female character is placed on the left.
The main character is the young African American female who is neatly dressed in casual clothes. She can be discussed as belonging to the upper-middle class. The background characters are young males and females. The pose of the main character demonstrates her self-confidence. The other characters interact with each other as good acquaintances.
Dark and light tones of violet, purple, and pink dominate this advertisement. They are used to accentuate the depicted night and lights produced by the gadgets screens.
The advertisement assumes that today, readers prefer to use many attractive gadgets and focus on innovations.
The advertisement is associated with the debates on the generation of young people who focus on their mobile devices instead of choosing traditional hiking, traveling, or riding to enjoy themselves.
The bright bicycle is depicted in contrast to the night environment, and it is perceived as the right vivid choice in the digital era to contribute to the readers focus on innovative goods.
The advertisement can mean that to follow the lifestyle of a modern successful person living in the digital era; it is impossible to focus only on applications because the process of riding the bright trendy bicycle is also the enjoyable healthy experience.
Regulation of multinational corporations is significant towards sustaining the social and economic aspects of the Australian society. Actually, the regulatory authority in Australia should be proactive in its activities to ensure that the interests of citizens are protected through enhancing ways by which multinational companies can serve the social and economic pillars as part of the corporate social responsibility.
Despite the series of benefits that Australia derives from multinational companies, such as improved skills, taxes, and increased employment, there are demerits of globalisation in business. These demerits include unethical business practices, low wages, poor working conditions, and disturbance of the social fabric of the dynamic society. Apparently, there is a need for the Australian authorities to regulate the multinational corporations contributions through incorporation of business ethics policies and neo-liberal economic intervention by creating regulations that minimise interference with the free economy.
Introduction
Purpose and context of the report
The prime principle of globalisation is featured by the interconnected holistic phenomenon. Due to globalisation, the world has become a village in terms of politics, economic endeavours, and cultural interaction. Understanding the position of globalisation in the Australian society requires critical analysis of cognitive values attached to practices, beliefs, and social dynamics which control and align a society towards astute of simultaneously interacting functions at macro and micro levels (Clifford 2009).
In the case of the Australian social and economic environments, the third estate comprising of employees has endured inhuman work environment treatment, unreasonable wages, and abuse of age limit for legal labour provided by some of the international companies that operate in Australia (Caputo 2007). This paper will present two recommendations to the Australian government on how it should regulate the multinational corporations contributions to the society and economy.
Background and rationale of the report
In Australia, the government is proactive in regulating the contributions of the multinational corporations to ensure that the economy and the society are at advantageous position. Specifically, the regulation has been implemented through the stringent requirements on corporate social responsibility, labour laws, and balance between economic and cultural aspects of sustainable business, in all sectors of the economy. With the rise in technology and other competitive forces in the modern global production activities, the government of Australia should introduce more stringent policies to guarantee mutual benefits between the citizens of Australia and the multinational corporations. Thus, the rationale of this report is to present a neo-liberal and social-democratic recommendations on the best way to regulate the contributions of multinational corporations to Australian society and economy.
Literature review
Existing views and findings
Social Perspective on Globalisation
The foundation of globalisation in business functions on global integration and its changing patterns that led to the current interdependent and networked of global order. Through the global production, the world is now manifested with the emergence of mass society in terms of social interaction: mass culture, mass welfare, mass consumerism, and mass communication. This institution has promoted cultural interaction and healthy business competition (Friedman 2006). The global culture enables mankind to acquire new skills, technology, and appreciate diversity through the global business regulations in different countries such as Australia.
Economic Perspective on Globalisation
The concept of development has attracted different reaction since it can be understood as a process likely to happen with economic growth or it could be understood as a dynamic socio-economic process for empowering poor and excluded people (Haslam, Schafer, & Beaudet 2012, p. 28). Though development is a continuous process, the Third-Way and Neue Mitter models are characterized by the motivation to positively improve the lives of those in the countries where international companies operate in.
These models inspire change and betterment of the target groups. Hence, an unlimited access to improved infrastructure has contributed to competitiveness, efficiency, growth, and increased capabilities of the citizens of the global societies (Cruddas & Nahles 2009). In the process, the social exclusion and inequality may be reduced.
Hidden face of globalisation in Australia
The hidden face of globalisation in Australia is suffering and exploitation of the poor factory workers by the successful international companies that make their products in Australia. These companies engage in unethical labour relations practices such as employing underage workers, paying peanuts to workers, and neglecting their social welfare despite the huge profits they generate from these products.
Due to the unstructured international relationship between Australia and these international companies, labour laws balance is threatened by sudden changes in the social systems of the Australian society introduced by the foreign companies (Lee 2009). This brings about the question of how the local people need to stay together and to attain their needs equitably, without involving in overindulgence, selfishness, and myopia.
Many authors have endeavoured to comprehend the revolutionary implications of neo-liberalism as it continued to evolve in an ordinary arena of business practices within their territorial borders. For instance, Karl Marx expressed these sentiments on alienation and pain in the lower class workers imprisonment by the companies who have the resources to manipulate and twist social, development, and welfare aspects of the Australian workers society.
In fact, it is apparent that these companies, drawn from the bourgeoisies and the ruling elites in the developed world of the international community, are thriving in discrimination and exploitation of labour supply to satisfy their selfishness (Gebert 2006). Since they are the masters of labour production tools such as wages, this group, comprising of just a small percent of the society, comfortably sits at the apex of Maslows hierarchy of needs pyramid and cannot share the huge profits with the local Australian labourers who are subjected to harsh working conditions to make designer items for other societies.
Internationalization is vital in business management and operations, especially when a company intends to localize production tools such as labour, distribution, language, ethics, and culture in order to fulfil the absolute advantage (Friedman 2006). Often, in the contemporary business environment, managers face challenges in line of duty, especially when the survival of a company is directly affected by unfavourable market swings.
The aspects of internalization, stereotyping, cultural classification, acculturation of a company, and how culture affects behaviour and responsiveness in the market for products are incorporated in various international trade theories (Gebert 2006). Foresight is very crucial since it gives a business rough perspective and an overview of the future concerning the expected and unexpected changes and challenges in the product life cycle. Therefore, businesses have to carefully examine and evaluate their past and endeavour to adopt relevant skills that will be relevant for future challenges and responsibilities (Narver 2009).
The international trade theory provides an overview of literature of various meanings with relation to their prospective or viewpoints of different market segments. Besides, it authenticates the ability to look forward into the future in an effort to predict and anticipate various developments before they actually take (McGrew 2007). In addressing the theory of factor endowment, foresight facilitates feasibility in production among international quarters engaged in trade since it focuses on balanced production factors.
In a perfectly skewed labour market, Smith argues that wages are supposed to be determined by the cost of production and total output. Unfortunately, this is not the case. The poorly paid employees of the foreign companies located in Australia are merely spectators of exploitation as though their hands and minds are imprisoned in the dungeon of social classes. Despite the fact they are the majority and providers of labour resources, they are unable to unite and move from mere spectators into agents of quantifiable and desirable change they long to witness in their work environment.
Interestingly, Locke argues that the world has enough resources for everyone when selfishness is locked from imprisoning the human mind (McGrew 2007). Development and perception of an individual are greatly influenced by events in his or her external environment such as the type of income received against labour given and the social welfare fostered by interaction. At present, these are skewed towards fulfilling selfish ambitions of the selfish and myopic global companies in Australia, that accrues huge profits from poorly treated, underpaid, overworked, and sometimes underage workers in Australia, especially from the Aboriginal community.
The neoliberalism school of thought opines that absolute gain comes before relative gains in a relationship between two parties. This belief is assimilated in the game theory to explain and extend on the positive and negative influences that these relationships create at the global level. Due to global interrelatedness, the economic meltdown has caused an imaginable damage in the democratic, business, and social segments. Besides, the mass society has weakened traditional societal values; capitalism revolution weakened aristocratic and traditional values such as socialism and communism in Australia (Parpart, Rai, & Staudt 2008). However, the merits of globalisation supersede its demerits.
Discussion
Evaluation of the current findings
The first characteristic of the international business system is the existence of different units. Reflectively, Waltz opines that as long as anarchy endures, states remain like units (Payne & Phillips 2010, p. 93). In reality, the independent states can be described as autonomous units of business power influence with more or less the same challenges. Waltz concludes that these units generate the rules of operation since their influence cannot be undermined. The second characteristic of the international system is the unique structure of change systems within each independent unit of influence.
The differences in the change system structures since the distribution of capabilities across the units (Rajesh 2006, par. 9) may not be easy to classify. The unique structure of change systems in the international system explains business alignment and partnerships among the autonomous state units. Personal gain supersedes the global interest. Specifically, through trade and/or cooperation, the political relationship within a state will limit its cooperation with other states (Payne & Phillips 2010).
Globalisation is a procedure of overseeing economic and social flows leading to economic association within trading corporations across the globe. Capital flows across borders and organizational structures are created in such a way that companies can respond quickly to changing environments. In the past two decades, technology has significantly become sophisticated, making it easier and economical for people to carry out business across the world (Rajesh 2006).
The driving forces have broken down many physical barriers to worldwide communication which used to limited connectivity between businesses over long distances. Globalisation is a multifaceted recognizable reality, encompassing a wider variety of dimensions (economic as well as social); where almost every measure of world markets and commerce-including the flow of foreign direct investment and traditional business culture-has been restructured with remarkable openness of economic and global views towards a barrier free global village (Read 1999).
The propelling factors for the increasing interconnectivity and independence of the worlds markets and businesses are availability of low-cost highly skilled human resources especially in less developed countries. Also, increased innovations and development in telecommunications and the microprocessor field has significantly reduced the transaction cost of carrying out businesses where the Information technology is a catalyst (Smith, Peterson, & Schwartz 2002). Thorsen and Lie (2012) pointed out the significance of globalisation as free movement of foreign traded goods and services, capital, technology and labour (Thorsen & Lie 2012, p. 35).
Further, public awareness of issues such as human rights, democracy and gender have increased significantly due to greater access to newspapers, radio, television, telephone, computer and internet. These developments have arguably led to improved allocative efficiency that, in turn, enhances growth and human development (Rajesh 2006, p. 51). Thus, there is a need for creation of neo-liberal and social-democratic policies to guarantee proper regulation of the contributions of the multinational corporations to the Australian society and economy to make the relationship between the state and these businesses sustainable.
Recommendations
Neoliberal approach
Foreign Direct Investment (FDI) is usually a commonly used driving force to attract globalisation in Australia. This is for the knowledge that FDI contributes to the creation of employment opportunities and infrastructure development (Read 1999). The most common strategy used to attract FDI into Australia is to establish a special export processing zones or free trade zones (Smith, Peterson, & Schwartz 2002). Australia is continuously inviting FDI without any study or research thus creating threats to the sustainable development and growth of local industries.
Therefore, there is need to regulate the FDIs in Australia to ensure that domestic companies can compete with the multinational corporations. Reflectively, globalisation has influenced the dramatic increase of FDI inflow in Australia and accelerated the role of the economic growth. However, the allocations of FDIs are not always smooth in Australia as such FDIs bring hypothetical development rather than real life scenario (Rajesh 2006). Therefore, regulations of the FDIs will put Australia in a competitive edge.
Social democratic approach
The Australian government should implement further regulations on the ethical management aspect of globalisation to protect its citizens from unethical business practices such as poor working conditions and unstable labour practices. This recommendation will attempt to incorporate a sense of honesty, integrity, and truthfulness in duty performance and embracing the dynamic Australian culture by multinational corporations (Smith, Peterson, & Schwartz 2002).
The proposed change will also guarantee that cultural values and conventional strategies are proactive in facilitating the creation of an imperative environment for interactive business despite differences in business variation and divergent insight (Thorsen & Lie 2012). Thus, the need for an ethical connection between Australian cultures and multinational corporations is important to ensure that their contributions to Australian society and the economy are sustainable.
Reference List
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Friedman, T 2006, The World is flat: The globalized world in the twenty-first century, Penguin, London.
Gebert, D 2006, Improvement in the context of transformational change: a study of acquisition and privatization in Eastern Europe. Journal of leadership and organizational studies, vol. 12 no. 3, pp. 7-12
Haslam, A, Schafer, J, & Beaudet, P 2012, Introduction to International Development: Approaches, Actors, and Issues, Oxford University Press, New York.
Lee, J 2009, The empowerment approach to social development practice: building the beloved community, Columbia university press, New York.
McGrew, A 2007, Globalization and global politics.
Narver, D 2009, Cultural Differences: Impacts to International Business Strategy.
Parpart, J, Rai, S, & Staudt, K 2008, Rethinking empowerment: development in a global/local world, Routledge, London.
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Read, L 1999, I Pencil: My Family Tree as told to Leonard E. Reed, Foundation for Economic Education, Irvington-on-Hudson, New York.
Smith, P, Peterson, M, & Schwartz, S 2002, Cultural Values, Sources of Guidance, and Their Relevance to Managerial Behavioural: A 47-Nation Study, Journal of Cross-Cultural Psychology.
Thorsen, D, & Lie A 2012, What is neoliberalism?. Web.
Hong Kong and Shanghai Bank Corporation [HSBC] was established in 1865 in the UK. The firm has experienced numerous changes over the years. The firms name was changed to HSBC Holding PLC in 1991. The firm is committed towards achieving a high level of competitiveness within the global banking industry. In an effort to achieve a high competitive advantage, HSBC has integrated growth as one of its corporate level strategies. Aswathappa (2008) asserts that growth strategy enables an organisation to improve the scope and scale of its operations.
The firm has entered a number of markets by adopting inorganic and organic growth strategies. One of the organic growth strategies that the firm adopts in the international market entails foreign direct investment. On the other hand, the firm has integrated the concept of merger and acquisition as its inorganic growth strategy. HSBC targets firms with high market potential in its acquisition process.
The market growth strategy adopted by the firm has played a remarkable role in enhancing the firms market expansion. By 2013, the firm had established 9,500 outlets in different parts of the world. The firm targets emerging markets as one of its investment destination. Examples of such markets include China, India, Brazil and Mexico.
This paper evaluates HSBCs strategic rationale in entering and operating in emerging markets. Secondly, the paper evaluates HSBCs organic growth strategy and its decision to expand its financial services in Chinas rural areas. Additionally, the major challenges faced by the firm in its operation within the Chinese banking industry are identified and analysed. Finally, solutions on how to deal with the identified challenges are identified. Different models which include the PESTLE model, the Porters five forces, the Hofstede model and the SWOT analysis model are used in evaluating the prevailing market conditions in the Chinese banking industry.
Analysis
HSBCs rationale in entering emerging markets
HSBCs decision to expand into the emerging markets was informed by a number of reasons. First, emerging markets are characterised by high market demand for financial services compared to mature markets. Subsequently, the likelihood of achieving the set organisational goals by establishing an outlet in emerging markets is relatively high.
The high market potential in the emerging markets arises from the fact that such markets are characterised by a low rate of penetration with regard to financial services. Furthermore, emerging markets are characterised by a high population growth rate. Subsequently, the demand for financial products and services in these markets is relatively high compared to supply. Financial institutions can exploit the prevailing market opportunity by providing diverse financial products and services. Additionally, the banks rationale to enter the emerging markets was informed by the need to provide banking services to diverse corporate customers. These markets are characterised by a high rate of growth with regard small and medium sized enterprises. This presents an opportunity for HSBC to maximise its profitability.
Macro environmental analysis
HSBCs success in the Chinese banking industry will be influenced by changes in the external environment. Aswathappa (2008) opines that the attractiveness of a particular industry is influenced by the prevailing macro-environmental forces such as the political, economic, social, environmental, legal and technological forces. Therefore, HSBC should understand the external business environment and the industry structure in its target market before entering. This can be attained by integrating the PESTLE analysis, the Porters five forces model, and the Hofstede model. These models will aid in gauging the likelihood of success.
The PESTLE model
The political-legal environment
China has been characterised by a high level of political stability over the past decades. However, the degree of political stability has reduced over the past few years. Morrison (2014) asserts that the number of public order disturbances increased by 50% between 2003 and 2006 (p.5). This shows the likelihood of China experiencing a high degree of political risk is high. Subsequently, HSBC might incur losses arising from such social unrests.
In an effort to prevent social unrests, the Chinese government has implemented strict measures to control accessibility of information by the general public. One of the measures that have been adopted entails blocking internet access. This might adversely affect HSBCs ability to undertake online marketing and other e-commerce activities such as online payment.
Despite this, China has implemented a number of legal reforms over the past three decades. For example, the Chinese government has eliminated trade barriers hence providing foreign companies an opportunity to enter the Chinese market. Furthermore, the government has streamlined licensing procedures hence making it easy for multinational companies to obtain operating licenses (Lam 2011). These legal reforms have led to improvement in the level of predictability and transparency in the countrys legal environment. Another major legal reform relates to liberalisation of the Chinese banking industry hence eliminating government control.
Economic environment
China has undergone remarkable economic growth over the past three decades. This has arisen from implementation of effective monetary and fiscal policies. The countrys economic growth has been enhanced by the recent economic reforms. The country had adopted a closed economy system for decades, which limited trade with other countries.
Upon its accession to the World Trade Organisation, China changed its economic system to an open economy in order to conform to WTOs requirements. This led to elimination of trade barriers, which increased trade between China and WTO member states. These changes have led to remarkable economic growth in China. Today, China is ranked amongst the fastest growing economies in the world (Morrison 2014).
China has made significant progress despite the 2008-2009 global financial crises. The government intervened by implementing a comprehensive stimulus program in an effort to promote economic growth. Subsequently, China has recovered from the economic recession (Morrison 2014). It is estimated that Chinas Gross Domestic Product (GDP) will grow at an average rate of 7% between 2014 and 2018. HSBC should consider implementing effective operational strategies in order to leverage on the projected economic growth (Morrison 2014).
Technological environment
The banking industry in China has undergone remarkable change arising from the high rate of technological innovation (Pereiro 2002). Banks are increasingly integrating electronic payment systems in an effort to attain a high level of operational efficiency and to provide customers with more convenient banking services. This trend might affect HSBCs future success in China if it does not adjust its operations to market changes. Furthermore, technological innovation poses a security threat in HSBCs operation through cyber crimes. Therefore, the firm will be required to implement effective security measures to counter such threats.
Social-cultural environment
China has experienced a rapid population growth over the past decades. Furthermore, Chinese are appreciating different financial products and services in an effort to improve their wellbeing. Subsequently, multinational banking companies are increasingly targeting China in an effort to exploit the high market potential. The high population in China has also played a significant role in attracting investors in the financial sector in an effort to market their financial products and services.
The Porters five forces model
Degree of rivalry; High
The Chinese banking industry is characterised by a high concentration ratio. A report released by China Banking Regulatory Commission shows that 50% of the industry is dominated by 5 major banks. Furthermore, the industry is characterised by a high rate of product homogeneity, which makes product differentiation to be difficult. This has led to remarkable increment in the intensity of competition. The intensity of competition is further increased by the high rate of growth amongst commercial banks as a result of relaxation of rules governing the banking industry by the Chinese government (Morrison 2014).
Threat of new entrants; moderate
HSBC is likely to face intense competition in the Chinese banking industry arising from the high threat of market entry. The high market potential in the Chinese banking industry is attracting both domestic and foreign financial service providers. Furthermore, the legal reforms in China have provided multinational companies an opportunity to enter the market. Despite this, firms entering into the Chinese banking industry must be approved by the Banking Regulation Commission (Morrison 2014). This is one of the main barriers to entry. Therefore, one can argue that the threat of entry in the Chinese banking industry is moderate.
Threat of substitute; low
The high rate of technological innovation has increased the intensity of competition within the global banking industry. The emergence of alternative payment systems and platforms has significantly reduced the need for traditional banking services. Currently, customers can access banking services online.
To safeguard itself from the high rate of technological innovation, HSBC will be required to improve its financial products and services in order to align itself with the market changes. In addition to this, China is experiencing an increment in the number of financial services companies such as trust fund and securities firms. However, these companies have not penetrated the entire Chinese market because of the strict and uncertain regulatory environment. Therefore, the threat of substitute is relatively low.
Buyer bargaining power; low
Accessing credit finance from Chinese banks is relatively difficult because of the high rate of interest required to service the loan. This makes the cost of credit from financial institutions to be high. Despite the high demand for credit finance, borrowers do not have the capacity to influence the rate of interest, which lowers the customers bargaining power.
Supplier bargaining power; high
Aswathappa (2008) asserts that the banking industry is characterised by different suppliers such as investment and securities companies. The suppliers develop different financial products, which are distributed to customers.
Suppliers within the Chinese banking industry have a relatively high bargaining power emanating from the tight regulations implemented by the government.
The Hofstede Model
China is ranked amongst the most culturally diverse countries in the world. It is important for HSBC to understand the prevailing cultural diversity in order to successfully expand into Chinas rural areas. This will enable the firm to effectively integrate cultural diversity in its human resource management practices hence increasing the likelihood of developing a strong organisational culture.
Hofstede (2001) emphasises that understanding the host countrys cultural dimensions is critical in firms internationalisation processes. HSBC will be required to adjust its management practices in order to align itself with the prevailing cultural dimensions. There are five main cultural dimensions according to Hofstede. They include; individualism/collectivism, uncertainty avoidance, power distance, masculinity/feminity and long-term orientation. Below is an analysis of how HSBC will be affected by the cultural dimensions.
Uncertainty avoidance
Hofstede (2001) defines uncertainty avoidance as the extent to which individuals are sceptical of the future. A high uncertainty avoidance index shows that individuals in such a society avoid uncertain situation. Chinas uncertainty avoidance index is estimated to be 46, which is relatively low. This means that the Chinese are generally comfortable with situations characterised by uncertainty. Therefore, HSBC will not experience major difficulties in its quest to implement change in its outlets located in China.
Individualism dimension
This dimension evaluates the extent to which individuals in a particular society are interdependent of each other. Subsequently, HSBC will be required to integrate the concept of teamwork in order to be successful in achieving its goals. Failure to integrate teamwork in its HR management practices will adversely affect the firms long-term survival.
Power distance dimension
According to Abu-Jarad, Yusof and Nikbin (2010), power distance explains the extent to which the members of the society are comfortable with inequality. Additionally, power distance is used to explain the extent to which a particular society accepts decentralisation or centralisation of power. Chinas PDI is estimated to be 80, which is relatively high. This means that Chinese accept considerable power distance between leaders and their subordinates.
Masculinity/feminity dimension
This dimension explains the extent to which division of labour is practiced between the male and female genders. Chinas masculinity index is estimated to be 66, which is relatively high. Hofstede (2001) asserts that a high masculinity index shows that the male gender is preferred in performing some duties. The high masculinity index in China shows that HSBC has take into account the societys perception in allocating roles between male and female employees. Furthermore, Wilbur (2013) opines that the likelihood of conflict in a society characterised by a high degree of masculinity is relatively high compared to a society characterised by a high degree of feminity (p.46). A high masculinity index shows that individuals in such a society are committed to their work. Subsequently, the likelihood of employees experiencing work-related stress is high. To deal with this challenge, HSBC will be required to implement effective work-life balance strategies.
Long-term orientation
Wilbur (2013) defines long-term orientation as the degree to which individuals in a particular society are focused towards attaining long-term goals rather than short-term goals. Therefore, a society characterised by a high long-term orientation index is very flexible, which means that employees can adjust to change. Chinas long-term orientation index is estimated to be 118, which means that Chinese are persistent in achieving long term goals.
Microenvironment
HSBCs success in the Chinese banking industry will be influenced by the effectiveness with which it leverages on its strengths, weaknesses, opportunities and threats.
HSBC SWOT analysis
The chart below illustrates HSBCs strengths, weaknesses, opportunities and threats.
Strengths
Financial resources; HSBC has a strong financial capital base as a result of its global operation. Subsequently, the firm will be able to establish additional outlets in Chinas rural areas..
Effective management: the firm has integrated effective management practices. The strong leadership has played a critical role in the firms market expansion efforts.
Strong reputation;HSBC is listed in reputable stock markets such as the Hong Kong and London stock markets. This shows that the firm is compliant with the legal requirements.
Strong market reputation; HSBC has established market presence in a number of emerging markets such as India, Brazil, Mexico and India.
Weaknesses
Global brand; HSBC has not been effective in positioning itself as a global brand. This might limit its ability to expand into the emerging markets.
Redundancy program: HSBC has integrated a redundancy program. The firm is increasingly restructuring its operations by undertaking massive job cuts. This might adversely affect the firms reputation in the international market.
Opportunities
Growth potential; HSBC can improve its profitability by establishing branches in emerging markets such as China, Brazil, Mexico and India by adopting organic and inorganic growth strategies.
Threats
Economic recession; the firms future success may be affected by occurrence of financial crisis in the emerging markets.
White collar crimes; HSBC faces a threat arising from the high rate of white collar crimes such as money laundering, hacking and insider trading. This may lead to a decline in the level of investor confidence.
Competition; the firm may be adversely affected by increase in the intensity of competition from multinational banks, which are increasingly entering emerging markets.
HSBCs organic growth and rationale for targeting Chinas rural areas
HSBC has adopted organic growth as its market entry strategy. The decision to adopt this strategy was informed by the need to increases its profitability by introducing its financial products and services to new customer groups. Additionally, the firms decision to adopt this strategy was informed by the need to develop a comprehensive understanding of the customers needs. Aswathappa (2008) argues that organic growth provides businesses with an opportunity to gain sufficient understanding of the prevailing market condition. Subsequently, business managers are able to identify areas of improvement hence increasing the likelihood of future success. By adopting organic growth, HSBC will be able to develop new products in order to satisfy the market needs.
HSBC has targeted Chinas rural areas in its market expansion effort. It is estimated that over 75% of Chinas population reside in the rural areas and do not have access to credit finance from financial institutions. Additionally, a significant proportion of Chinas rural population is unbanked. This presents a high market opportunity for HSBC to exploit by providing its financial products and services. Consequently, HSBC will be able to enhance the level of its profitability.
Conclusion
Aswathappa (2008) asserts that emerging markets are characterised by high market potential. Subsequently, firms are increasingly considering expanding into these markets in an effort to maximise their profitability. HSBC has established its operation in a number of emerging markets. This has played a remarkable role in improving the firms competitiveness within the global banking industry. The firm has integrated both organic and inorganic growth strategies in its market expansion efforts.
China is ranked as one of the most attractive emerging markets. Some o the factors that have increased the countrys attractiveness is the high rate of economic growth and the high population (Aswathappa 2008). Subsequently, Chinese have experienced a remarkable increment in their purchasing power. Furthermore, the countrys commitment in undertaking legal reforms has enhanced its attractiveness. HSBC has targeted China as one of its investment destinations.
Decision to enter the Chinese market was informed by the high market potential especially in the rural areas. A significant proportion of the countrys population resides in the rural areas and does not have access to bank products and services. HSBC might achieve its profitability objective by establishing branches in these areas. However, it is imperative for the firm to understand the prevailing market conditions and the customers needs and expectations before implementing its expansion strategy. Subsequently, the firms management team should take into account the following aspects.
HSBC should undertake a comprehensive market research in order to understand the countries, political, economic, social, legal, and technological trends affecting the banking industry. This will aid in development of the right financial product. This will give the management team insight on how to adjust the firms operational strategies.
HSBC should assess its internal environment in order to understand its strengths, weaknesses, opportunities and threats. This will enable the firm to implement effective operational and management practices to promote its growth.
HSBC should take into account Chinas cultural dimensions in the process of formulating its management practices. This will increase the likelihood of the firm developing a strong and efficient human capital base.
Reference List
Aswathappa, K 2008, International business, Tata McGraw Hill, New Delhi. Abu-Jarad, I, Yusof, N & Nikbin, D 2010, A review paper on organizational culture and organizational performance, University of Malaysia, Malaysia. Web.
Hofstede, G 2001, Cultures consequences: Comparing values, behaviours, institutions, and organizations across nations, Sage Thousand Oaks, CA. Web.
Lam, W 2011, Beijings Wei-Wen imperative steals the thunder at NPC, China Brief vol. 11, no. 4, pp: 2-4. Web.
Morrison, W 2014, Chinas economic rise; history, trends, challenges and implications for the United States. Web.
Pereiro, L 2002, Valuation of companies in emerging markets; a practical approach, John & Wiley, New York. Web.
