Maxfli’s exploratory research began by conducting focus groups to find out the motives of why people were buying the golf balls. Also, the focus groups were used to determine what people needed and what sort of image the equipment had. As such, telephone surveys were carried out.
People were divided into different types of golfers and the results were adjusted accordingly. From one perspective it was appropriate, as the company needed a fresh start and increase in the profits. Qualitative research is one of the key ways in uncovering the true reasons why people buy specific products (Maxfli).
Their motivations and inner emotions must be closely studied in order to figure out attitudes and behaviors that lead out of thinking. The focus groups are a good resource, but there are some limitations. One of them is that there is too much attention to be paid to certain things, without having the direct and necessary focus on the needs of consumers. Also, because a focus group is an internal structure, it would be difficult to create circumstances that answer to the needed criteria of the real life.
Calling people on the phone is sometimes bothersome, so many probably thought that it was not the best choice. The preference of balls is mostly performance based. But, as the case study mentions, a lot of golfers are also looking for fashion, not only function. By having a telephone survey, people will not be able to see the ball and decide which one is better. It is impossible to test the ball over the phone and give people a feel of the equipment.
Another problem is that not all people will be reached by the phone, as they might be out or simply do not want to be disturbed. For this purpose, a TV commercial with a phone number to dial in order to make the selections could be made. There would need to be a close demonstration of the balls’ visual characteristics, but more importantly, the balls would have to be tested and put into play. A door to door survey would be another possible solution, as people could be presented with the product and get “a feel” for it themselves.
An observation method would be a good way to see what the customers really want. Direct observation with no or limited participation could be used. Golf is a game where a person must feel relaxed and confident in their strength (Seltzer, 2007). Also, the fact that it is an observation “in action” allows for real life situations to take place. Structural observation and field experiments could be used as well since people respond well to the environment and would enjoy being the participants of such a study.
In the twenty-first century, the use of technology has become an everyday occurrence. People are dependent on it in almost all aspects of life. It has made the daily functions easier and more practical, as the software programs, internet and stored memory have extended the use of information and understanding.
As a result, internet would play a major role in the future research methods. It could make the survey part easier, as well as advertise and contribute to people’s awareness of the product and market demands. The speed in the spread of information is enormously increased.
References
Maxfli. (n.d.). Web.
Seltzer, L. (2007). Golf: The Science and the Art. Mustang, OK: Tate Publishing.
In today’s business environment, competition is an important factor in determining the growth or decline of an organization. Competitive intensity illustrates the vigor with which organizations attempt to woo clients within a given industry. An example is seen in the 2009 case study of the golf industry.
In this paper, competition in this sector is examined from the perspective of the companies involved in the manufacture and distribution of golf equipment. The essay looks at the effects of new entrants into the market.
The author of this essay looks at the negative effects of Nike’s entry into the golf equipment industry (Gamble, 2008). The arguments made in the paper are based on the ‘threat of entry’, a strategic management concept. The impacts of this concept in the golf industry are analyzed in relation to Porter’s forces framework.
Nike’s Entry into the Market
According to Rothaermel (2012), businesses operate within a specific market segment. The organizations try to attract as many customers as possible. Under such circumstances, the businesses are perceived to be in competition. According to Gamble (2008), Nike capitalized on the fame of Tiger Woods to gain a competitive edge in the market.
In 1996, the company entered into a contract worth $40 million with the golfer. By 2000, Nike was paying Woods an endorsement fee of more than $20 million per year. Gamble (2008) argues that in spite of these promotion campaigns, Nike’s market share in the golfing equipment industry remained below the 3% mark.
The problems faced by the company at the time were attributed to its market entry strategy in 2002 (Gamble, 2008). There was a branding problem as a result of complaints from golfing clubs that were not at the same level with Woods. Consequently, the response from the market was not as enthusiastic as expected.
As a result, the revenues of the company remained low. By virtue of being a market leader in the sports industry, Nike managed to increase its competitive intensity in the golf equipment sector. The phenomenon is best explained using Porter’s threat of entry force.
Threat of Entry
As already mentioned, threat of entry is one of the strategic management concepts highlighted in Porter’s forces framework (Rothaermel, 2012). According to this model, the entry of a new entity into a market may have adverse effects on the competitiveness of existing firms. Gamble (2008) points out that the lucrative nature of the golfing industry made it easy for Nike to access the market
A new entrant increases rivalry in the market, especially when the number of potential clients is limited (Rothaermel, 2012). The scenario is evident in the case study when existing firms were forced to lower their prices to attract clients. In analyzing competition, the threat of entry concept presupposes that a new entrant drives down the profits in the industry. Gamble (2008) illustrates such a scenario using Nike’s experiences.
Threat to entry highlights the need for regulation to ensure that the market is not negatively affected by a new entrant. Gamble (2008) postulates that Nike’s entry into the market faced little resistance. The same explains the company’s unethical practice of manipulating market prices.
Conclusion
The entry of Nike into the golf equipment industry drove down the prices of commodities. According to Rothaermel (2012), this is one of the major impacts that a new entrant has on the market. The entry increases competitiveness in the industry, driving down profit margins in the long term.
References
Gamble, J. (2008). Competition in the golf equipment industry in 2009. In J. Gamble (Ed.), Essentials of strategic management: The quest for competitive advantage (pp. 279-301). London: McGraw Hill.
Rothaermel, F. (2012). Strategic management: Concepts. New York: McGraw Hill.
In today’s business environment, competition is an important factor in determining the growth or decline of an organization. Competitive intensity illustrates the vigor with which organizations attempt to woo clients within a given industry. An example is seen in the 2009 case study of the golf industry.
In this paper, competition in this sector is examined from the perspective of the companies involved in the manufacture and distribution of golf equipment. The essay looks at the effects of new entrants into the market.
The author of this essay looks at the negative effects of Nike’s entry into the golf equipment industry (Gamble, 2008). The arguments made in the paper are based on the ‘threat of entry’, a strategic management concept. The impacts of this concept in the golf industry are analyzed in relation to Porter’s forces framework.
Nike’s Entry into the Market
According to Rothaermel (2012), businesses operate within a specific market segment. The organizations try to attract as many customers as possible. Under such circumstances, the businesses are perceived to be in competition. According to Gamble (2008), Nike capitalized on the fame of Tiger Woods to gain a competitive edge in the market.
In 1996, the company entered into a contract worth $40 million with the golfer. By 2000, Nike was paying Woods an endorsement fee of more than $20 million per year. Gamble (2008) argues that in spite of these promotion campaigns, Nike’s market share in the golfing equipment industry remained below the 3% mark.
The problems faced by the company at the time were attributed to its market entry strategy in 2002 (Gamble, 2008). There was a branding problem as a result of complaints from golfing clubs that were not at the same level with Woods. Consequently, the response from the market was not as enthusiastic as expected.
As a result, the revenues of the company remained low. By virtue of being a market leader in the sports industry, Nike managed to increase its competitive intensity in the golf equipment sector. The phenomenon is best explained using Porter’s threat of entry force.
Threat of Entry
As already mentioned, threat of entry is one of the strategic management concepts highlighted in Porter’s forces framework (Rothaermel, 2012). According to this model, the entry of a new entity into a market may have adverse effects on the competitiveness of existing firms. Gamble (2008) points out that the lucrative nature of the golfing industry made it easy for Nike to access the market
A new entrant increases rivalry in the market, especially when the number of potential clients is limited (Rothaermel, 2012). The scenario is evident in the case study when existing firms were forced to lower their prices to attract clients. In analyzing competition, the threat of entry concept presupposes that a new entrant drives down the profits in the industry. Gamble (2008) illustrates such a scenario using Nike’s experiences.
Threat to entry highlights the need for regulation to ensure that the market is not negatively affected by a new entrant. Gamble (2008) postulates that Nike’s entry into the market faced little resistance. The same explains the company’s unethical practice of manipulating market prices.
Conclusion
The entry of Nike into the golf equipment industry drove down the prices of commodities. According to Rothaermel (2012), this is one of the major impacts that a new entrant has on the market. The entry increases competitiveness in the industry, driving down profit margins in the long term.
References
Gamble, J. (2008). Competition in the golf equipment industry in 2009. In J. Gamble (Ed.), Essentials of strategic management: The quest for competitive advantage (pp. 279-301). London: McGraw Hill.
Rothaermel, F. (2012). Strategic management: Concepts. New York: McGraw Hill.
The introduction of new rules that limit innovation in the Golf Equipment Industry (GEI) is a major reason for the slow growth in the number of golfers in the recent years. In addition, the global financial crisis that began in December 2007 to 2009 had a devastating effect on the number of golfers in the GEI.
Competitive rivalry force was the most affected among the Porter’s five forces (Gamble 11). This force determines the value that is created in an industry through head-to-head competition among firms. Competition within the GEI was centered on technological innovation, which was permitted initially by the United State Golf Association (USGA) and R&A (Gamble 11).
Product innovation, performance, image, tour exposure, and price were among the other competitive strategies that companies used and by 2009, every company had met the required equipment dimensions, CT, and MOI (Gamble 8). The companies had started to differentiate their products as an innovative survival strategy in the industry.
The golf equipment manufacturers had relied on innovation to enhance their competitive positions in the market (Gamble 7). For instance, between 1990 and 2000, the golf equipment manufacturers came up with innovations to make the golf easier to play.
These innovations reduced the effects of the adverse off-center hits. At the same time, the innovations improved the shot accuracy by grooving the wedges of the stick. This reduced the variance in the distance of a well struck ball and a poorly struck ball.
However, the USGA took an important step to safeguard the pre-historic golf courses and equipment standards. This involved setting of new quality standards for the golf equipment. This reduced the innovation rivalry in the industry, leaving the companies to use equipment prices as the only competitive approach.
This discouraged people from playing golf (Gamble 9). According to the case study, the decline in the number of golfers is attributed to these changes. Golfers were increasingly frustrated by the difficulties they encountered while playing golf. This resulted in many golfers denouncing the sport. In addition, new individuals were reluctant to take up the sport.
Another factor that led to the decline in the number of golfers was the economic recession that occurred between December 2007 and 2009 (Gamble 10). According to the case study, the recession was caused by the financial problems in the credit and housing industries as well as a rapid increase in gasoline price. For instance, gasoline price increased from $2.25 in early 2007 to $4 by June 2008.
The high gasoline prices coupled with an increase in credit expenses and a destabilized mortgage industry led to discretionary spending cuts. In addition, increased unemployment contributed to this problem. For instance, more than 6.5 million Americans lost their jobs. These events led to the decline in the number of golf equipment sold in the market.
In conclusion, it is important to restate the reasons for the decline in the number of golfers in the industry. The introduction of new rules and standards in the industry reduced innovation-based competition (Gamble 11).
Moreover, the economic recession that was witnessed between 2007 and 2009 is blamed for the decline in the number of golfers (Gamble 10). I recommend that the reintroduction of equipment innovation by the USGA should be done so as to foster competition in the industry. This would increase the number of golfers in the sport in the long-run.
Works Cited
Gamble, E. John. Competition in the Golf Equipment Industry. London, UK: McGraw Hill, 2009. Print.
Although the game of golf developed rapidly and became an important part of the American life between1950s and 2000s, it is worth noting that the nature, strength and performance of the national economy have been major factors determining the rate of growth of the game. Between 2006 and 2009, the economic crisis in the US had a major impact on several fields.
The game of golf is perhaps one of the sectors that was mostly affected by the economic decline. The evidence collected from companies dealing with golfing equipment and tools indicates the slow growth in the industry, but a surge in the competition between these companies. In particular, the number of players was stalling, causing a decline in the volume of equipment sales between 2006 and 2009.
It was especially evident that the economic recession and the start of regulations by the USGA and Ancient Society brought a negative impact on the industry, which increased competition between the involved companies. This reviews the competition in the industry in 2009 with a focus on the Porter’s Five Forces Model.
Application of the Porter’s Five Forces Model in this case is likely to reveal adequate and important information significant for providing an explanation of the phenomenon. The golf equipment industry has been a major beneficiary of the growth and expansion of the game over the last six decades, which also has been a subject of the expanding economy.
Nevertheless, an economic crisis is likely to affect the industry in a negative way since the fall in people’s purchasing power is likely to drive more players from the game and hinder the appearance of new players.
Potential entrants: It is worth noting that the American golf industry has been dominated by large corporations, which have invested heavily in the field. In fact, most of the manufacturers of golfing equipment are some of the major corporations that also sponsor major golfing events in the US and the world.
This means that the investment in the sector has been relatively big and that it has been difficult for new companies to enter the market, thus protecting the dominating companies from the threat of new entrants. Secondly, new companies were required to cope with high costs of technology that dominating companies have been using to develop equipment.
Bargaining power: The golf equipment industry in the US is characterized by high bargaining power for the buyers, which allows the consumers to switch to another brand. In addition, the market was on the decline.
The threat of substitute products was also high because golfers had an opportunity to join other sporting activities such as Hunting, Running, Tennis and Riding for their increasing popularity, while their costs remained relatively low. In addition, movies, games and other activities are becoming popular among the American middle class, which seems to be replacing golfing.
It is also worth noting that the supplier’s bargaining power was high, especially because several Asian nations such as China and India were offering products at lower prices. In addition, these foreign suppliers had the technologies and knowledge to develop competitive products.
Moreover, the rivalry among the suppliers was relatively high because the industry had been developing for more than 50 years, attracting high prices and profits. As such, the risks of counterfeits were high, while regulations on products increased with the establishment of the USGA and Ancient Society’s terms and conditions.
Competent company executives always strive to provide leadership that enables the marketing staff to clearly identify the characteristic of the target market and enable them to provide tailor made products and services that are suitably aligned to the needs of the current and prospective buyers.
In Target Market’s (2004, p.2) argument, the case with 3M Greptile Grip golf glove is that the market is defined by a huge baby boomer population, which has matured with time to a prime earning potential.
According to Afuah’s (2003, p.356) business model, the market is defined by people with different demographic characteristics who belong to different age groups, ethnic backgrounds, and female golfers who account for 25% of the entire golfer population in the United Sates. The estimated value of the market which has been growing dynamically is valued at US $ 300 million.
The demographic characteristics which are defined by income levels, occupation, family lifecycle, and years of business, education, market trends, market size, geographic distributions, lifestyle, social classes, and consumer behavior are evident in the above case study.
The case study shows people with different income levels, a dynamic trend in market growth and size, and a number of new entrants into the market. The case shows new entrants into the market to include Bionic’s Classic brand designed with the educated class of orthopedic surgeons in mind.
Key points of difference when compared with competitors’
Company executives know very well how to differentiate the characteristics of rival firms to survive in a market with rivals who operate using creative techniques and competitive strategies in the innovation and production of company products and services. The company uses technology to create high quality products with unique attributes to meet the unique needs of the target market.
In context of studies by Afuah (2003, p.3), it is demonstrated in the case study that 3M Greptile Grip golf glove uses technology, innovation, pricing, and a creative and highly skilled product development team with a strong reputation and image for innovation and quality to produce tailor made products for the market.
The company has a sports unit managed by a highly skilled marketing staff with an innovative approach to doing business. Other firms in the case study do not demonstrate their reliance on an innovative and highly skilled marketing staff with the dynamics of innovation and creativity.
Another key difference with competing products includes gloves with improved gripping capabilities provided by the company. The case study provides one example of the Premium Greptile golf glove which is designed with the highest quality Gabretta leather in the market. When the product was produced in 2005, according to the case study, the suggested price varied between $ 16.95 and $19.95.
Here, quality and prices are combined to make the product competitive in the market. Another trend that crystallized other differences between 3M and competitors was the introduction of another Greptile Grip golf glove that was suitable for the European and Japanese markets. The Japanese and European markets took the second and third position after the US market for the gloves.
In comparison, a competitor, “marketer Bionic” introduced into the market gloves designed for orthopedic surgeons to compete with the 3 M firm’s early gloves for orthopedic surgeons. A significant difference in the he pricing strategy used by Bionic and footJoy is that the competitors’ product prices are significantly higher than the prices of 3M’s products.
In this case, Bionic produces Classic which goes at $ 24.95 $ and Pro which goes for $ 39.95. On the other hand, FootJoy’s Pure Touch Limited which goes for $ 28 as a precision fit product and SciFlex which goes for $ 18. In comparison, 3M products go for $16.95 and $ 19.95 respectively.
It is critical to note that that 3 M’s approach to product pricing is that of keeping the price as low as possible, below the competitors’ product prices. In addition, the competing firms attempt to produce products that are of high quality using artificial materials such as the SciFlex glove produced by FootJoy to ensure quality. Contrary, it is evident 3M uses leather to manufacture its high quality gloves for the market.
According to the case study, competing firms are quite sensitive to the market dynamics. The changes include a drop in income levels of many households because of recession which is the direct reason many people have reduced their purchasing capabilities.
It is important to note that existing firms or new entrants can introduce substitute products into the market in an attempt to clinch a market share.
The changes in price and income levels have been shown to have a direct impact on the demand of a product, making a shift in demand in one direction depending on the prevailing conditions. The specific needs of the users of gloves can certainly be satisfied with substitute products which are produced and offered in the market in 3 packs, 2 packs or in single packs at low prices.
3M’s Three Criteria for New Products
Greptile Grip golf glove strives to meet the 3 M’s three criteria for new products by setting prices for its products that are created with technology, durability, and comfort as the core elements in the production of the gloves. Here, the company takes a critical evaluation of the market to determine the global market demand for the products and the trend in the sports world that could stimulate demand for the gloves.
That is in addition to the quality of the gloves in terms of gripping capabilities. Here, the company focuses on a replication technology which incorporates different ideas from different organizational employees to give a try of new innovative ideas which are transformed into a new technology that enable the production of gloves of high quality and gripping capabilities (Afuah 2003, p.24).
A critical analysis and study of the case study shows that the problems associated with the promotion and distribution of its products include developing a sustainable and effective global supply chain system, conducting marketing campaigns in a multicultural environment that is characterized the differences in a global environment, ethical questions that arise because of the environment, personal selling problems, the ability to take a customer oriented approach, geographic concentration of customers, pricing because of substitute products, political problems because of marketing across different countries, and new competitors (Target Market 2004, p.3).
That brings about channel distribution problems, lost opportunities which include late deliveries, the need for a large investment capital, the reaction by the old players in the industry against the new entrant, and the economies of scale.
References
Afuah, A N 2003, Business Models: A Strategic Management Approach, McGraw-Hill/Irwin, New York.
John Elkington introduced the Triple Bottom Line (TBL) notion to the corporate sector with a purpose of encouraging investors to establish businesses that have commercial, communal, and environmental benefit. TBL is a concept of sustainability whereby the success of an organization is measured using three dimensions, namely income, individuals, and the earth. Governments and non-governmental institutions recognize TBL globally as a measure of sustainability. Sustainability refers to the progress that satisfies the desires of the present society while protecting the needs of coming generations. As a measure of sustainability, TBL offers an opportunity for companies to enjoy the value of their investments while protecting the priorities of the society. This paper uses the golf course that is owned by the Thailand government as a case study. The goal is to determine the success of the course using the TBL concept.
Success of the Golf Course
Traditionally, sustainability only had an environmental dimension. However, since the inception of TBL, academicians have been emphatic that it entails the interrelationship among businesses, ecology, and human welfare. Consequently, determining whether the Thailand government has succeeded in offering economic prosperity and improving the standard of living in the country by establishing the golf courses can be best explained using the agendas set by TBL (Dhiman 54).
Traisawasdichai reveals that the golf course earns investors (Thailand government) good income because of the wealthy clients (16). However, Traisawasdichai also asserts that the investment has led to pollution of the environment and dilapidation of human life (16). The pesticides that are sprayed on the golf course grounds harm the health of the neighboring residents and employees of golf companies. Cases of various types of cancers have been increased following the emergence of more golf courses.
Furthermore, inconsiderate investors have seized resources such as the land and water that can be used for farming. The Thailand government is said to have intended to promote economic affluence and the quality of life of its citizens. Perhaps, a nonprofessional would infer that the government has failed to improve its ambition. One may also claim that indeed the state has achieved its goal as the project improves the Thailand economy and the lives of various Thailand inhabitants. Nonetheless, measuring the achievement of the project through the lens of TBL would best determine its degree of success or failure as noted by Savitz and Weber (35).
Defining TBL raises no issue. The problem lies with measuring whether a project meets the actual tenets of TBL. The three major elements of TBL do not have a similar unit of comparison. Thus, weighing the economic, social, and ecological impact of the golf courses is not an easy process as one may presume. Profits are measured in the form of currency. For instance, the local currency or dollars may be used to determine the growth or failure. However, the challenge arises when income has to be compared with social capital and the ecological effect (Savitz and Weber 45).
The three dimensions should be weighed using monetized units. Conversely, such an approach may be misleading when valuing environmental elements such as wetlands and imperiled species. Other commentators such as Dhiman have suggested that the measurement should be done based on index (57). Indexing enables one to measure the different elements of sustainability based on unanimously recognized accounting measurements without necessarily considering the dissenting units. However, the main setback for this measurement technique is the criteria that should be used to value one component more than the other since the components may not have equivalent weighting.
TBL lacks a universal mode of gauging the incompatible units. Consequently, this situation implies that one is allowed to gauge the meaning of TBL from a subjective view without losing the meaning of sustainability. The site, nature, and entity will influence how success is measured with respect to TBL. Therefore, the stakeholders, the state, and specialists of the subject will play a significant role in determining whether the project has met the goal it was meant to attain. Moreover, scholars accept some universal traditional sustainability variables that determine whether an institution is committed to promoting sustainability.
The economic variables include evaluating the flow of money such as per capita income, employment progression and allocation, and the contribution of the investment to the Gross Domestic Product (GDP). With respect to social measures, one should consider how the project benefits the community in terms of education, availability of social amenities, and social capital. Likewise, ecological variables to be considered when measuring success of an investment comprise the project’s effect on natural resources such as water, energy, and forests. Measuring the t environmental elements on a long-term basis is effective since it reveals the implications of a business to the surroundings. The variables may then be analyzed using a Genuine Progress Indicator (GPI) to determine the success of an organization in implementing the sustainability tenets. GPI often uses monetary units to weigh the progress of an investment (Dhiman 57).
The Project was a Failure
After discussing how TBL calculations are conducted, it is possible to determine the success of a government in achieving its vision when investing in the golf courses. First, the government of Thailand’s investment failed to uphold environmental protection standards. Traisawasdichai narrates that the golf courses have depleted the water that farmers used to irrigate rice farms (17). A firm that focuses on not only income but also the ecosystem and people will use water resourcefully. Water is a crucial resource for golf courses, the society, and ecosystem in general. Therefore, there is the need to conserve and manage it ingeniously to ensure that it benefits the extant and forthcoming generations.
However, the golf courses are involved in water-theft with the aim of getting more water to keep the water golf grounds green. Such unscrupulous practices can only lead to depletion of water resources, contrary to the purpose of TBL. Moreover, there is evidence to show that dead birds are retrieved from the golf grounds the morning after green keepers spray pesticides. Evidently, the pesticides are injurious to the ecosystem. However, the government has tolerated the practice. Accordingly, this case violates the doctrines of sustainability.
Savitz and Weber assert that the social implications of the golf courses are also substandard (45). While the project meant to enhance the standard of life of the Thailand citizens, only the rich people benefit. It seems like the state is promoting a system through which the wealthy people prosper while the poor ones agonize. A firm that does not respect social equity and/or discriminates the poor class to satisfy the desires of the wealthy is substandard when viewed through the lenses of TBL. Contritely, there are suspicions that the chemicals used in the golf courses expose workers and residents to deadly ailments such as cancer. Introducing terminal ailments to citizens does not improve their standard of life. It fails on even the traditional variables for gauging sustainability.
Thirdly, Traisawasdichai is uncertain whether golf courses have resulted in economic affluence in Thailand (16). Foremost, the golf is a sport for the rich. Most of the clients are wealthy tourists. Apart from using the golf courses owned by the government, they often use resources that are owned by their home countries. For instance, Traisawasdichai reveals the hotels and devices that are owned by companies from their (wealthy people) home states (17). Definitely, the government earns revenue from the sport. However, whether the revenue is realistic and acceptable is tentative. The sport requires vast and green lands. Most of this land is left vacant. The land that was being used for agriculture is now part of the golf courses. Indeed, agriculture has a high economic benefit unlike golf. Clearly, even though the government may assume that the golf earns the country revenue, agriculture would have more economic benefits.
It follows that the government of Thailand has failed to accomplish its objective of improving the livelihood of the electorate and the economy. It does not meet the standard of the Triple Bottom Line sustainability. Indeed, going by the observation made by Traisawasdichai, if the authorities continue to run the business, it will soon destroy the economy and ecosystem and create discriminatory tendencies among the citizens (17). Considering the failure of the golf course project, the state needs to reevaluate its policies. It should adopt initiatives that will not only lead to increased revenue but also benefit the community while at the same time conserving the environment.
A Utilitarian/Rule-Utilitarian view on the Thailand Golf Courses
According to Carroll and Buchholtz, utilitarianism is a moral theory that was defended by John Stuart Mill and Jeremy Bentham. The theory gauges how right or wrong an action is by measuring the amount of happiness or reverse happiness it promotes (23). The concept of utilitarianism is a form of consequentialism because it is founded on the idea that the results of an action determine whether it is right or not. Utilitarian supporters declare that the purpose of morality is to increase happiness when decreasing sorrow. They assert that an action should only be chosen if it produces the maximum result. They differ from their counterparts who argue that the morality of an act depends on the motive behind it. According to Jeremy Bentham, an action taken among a group of people should yield the furthermost contentment for the greatest number of individuals. A choice made without consideration of the greater number of people is not moral according to the concept of utilitarianism.
Socioeconomic school proponents have a similar view to the founders of the utilitarian doctrine. They assert that investors should encourage an economic system that satisfies the desires of the society (Carroll and Buchholtz 67). They believe that manufacturing and supply should improve the socioeconomic welfare. Socioeconomic thinkers believe in the need to focus more on the needs of the community, as opposed to the shareholders. However, the utilitarian principle does not expound on the individuals whose needs should be maximized. Therefore, it creates the need to establish as deontic constraint to circumvent the possibility of stakeholders’ welfare endangering the longstanding aspirations of a corporate (Carroll and Buchholtz 67).
The establishment of a golf course is not a wrong act. The project is a positive addition to a country as a recreational facility. However, when the result of its creation interferes with the smooth operations of a greater number of people, then the action is not right. Rice farmers provide food for the general population, including the poor and the rich. Additionally, besides rice production boosting the economy of the country, it gives farmers livelihood. Thousands of rural populations in Thailand depend on it. On the other hand, golf is a prestigious game that is played mostly by the elite class in Thailand. The depletion of water supply that is crucial for rice farming by golf courses does not attain the greater good of the community. Rather, it benefits only the few wealthy citizens and tourists.
When a crisis affects the whole country, the government is supposed to allocate resources in a fair way that serves the greatest good of its citizens. During the drought that affected Thailand in 1994, grave water shortage was witnessed. Rice farmers looked to the government to issue policies that would protect them. However, the government chose to prohibit rice farmers from planting a second crop. The water supplies were also offered to the golf courses. The golf courses consumed water that was enough to sustain 60,000 people. The number of people who were negatively affected by the diversion of water supplies to golf courses greatly surpassed the people who benefited. Around 60,000 people were denied water, which was already short in supply due to drought, to the benefit of a few golf courses. Food production, which is crucial, especially during drought, was halted, thus putting poor citizens at the risk of starvation. Therefore, the choice made was wrong.
Environmental conservation should be a primary consideration in the construction of any project. The construction of golf courses and their maintenance using dangerous pesticides has been hazardous to people who provide labor and even the animals. Additionally, the establishment of golf courses near watercourses and natural habitats has grave ecological implications. It is more beneficial to the community if the environment is conserved than the construction of a golf course that only serves the rich people. Therefore, the construction sites for such projects should be done in areas that reduce the risk of contaminating water, air, and soil for the general population. Regulation should also be done on the total acreage that should be used on such facilities to avoid eating into land, which can be used in a way that edifies the general population.
The construction of golf courses in Cambodia should be highly regulated by government policies, which are protective of its citizens’ interests. There should be regulation of the area that is allowed for the development of the golf course. Instead of using massive tracts of land for development of golf courses, the government should invest in projects that benefit the majority, thus maximizing utility. Additionally, the sites allocated for such development should be away from general population to avoid contamination of air and water among the population.
Organic products are less harmful as compared to synthetic chemical products. Therefore, they should be used in replacement of the pesticides that are used in golf courses to reduce pollution and poisoning. This strategy will be more beneficial to the people because it will prevent a rise in cancer cases and the death of birds. Water supply is very vital in the life of every individual. Golf courses in Thailand have been known to curtail water supply for scores of villagers to irrigate their grass. Therefore, water rationing should be done by the government of Cambodia in case of development of golf courses to ensure that they do not suppress the needs of the majority.
Factors to Consider when determining if the Golf Course Manager is Morally Responsible for the Damages
Ethical responsibility is often expounded to mean obligation or liability. The idea of moral responsibility is unambiguous. People are considered ethically responsible if they trigger the act or omission, are aware of their action/omission, and have the potential to stop the act from occurring. Every rational individual unanimously accepts these provisions. The same factors are applicable to business. When the three provisions are established, then a company must be answerable for any injurious aftermath. Therefore, during such instances, a manager may be found ethically accountable for damages.
Traditionally, managers’ ethical responsibility was linked to the role of ensuring that a company remains profitable. Milton Friedman believed that the only social duty of businesses was to utilize the resources, as well as participate in acts that boosted their revenue so long as they did not violate any marketplace regulations. This notion was based on the economic doctrine that the task of everyone in the market was to maximize utilities or increase revenue as propagated by capitalistic academicians. Moreover, managers made this commitment to their employers. Thus, it would be fair and just if they were held liable to what they promised. Friedman further argued that companies should invest in activities that are ethically accepted while at the same time participating in ventures that have economic benefits (Ferrero, Hoffman, and McNulty 37).
However, after seasons of studies by scholars, the literature has drastically changed remarkably. Corporate managers have been given the role of handling the company such that it benefits stakeholders. Therefore, their moral duty involves maximizing utilities to secure the interests of every entity with a stake in company. The concept has been coined as Corporate Social Responsibility (CSR). Modern commentators have deciphered the concept to mean that the moral responsibility of a manager starts with the society before considering benefitting the investors.
CSR seeks to ensure that companies have extensive duties that incorporate shareholders, suppliers, workers, consumers, neighboring communities, and any other relevant constituency. When designing their objectives and strategies, administrators must consider the interest of the beneficiaries. The companies have legal duty to ensure that their initiatives correspond with the state legislations that control the marketplace. Morally, a corporate is required to run their programs in a way that honors social justice and equity. Moreover, the society demands that companies have to align their affairs with the social morals, although such practices may be absent in the law. Businesses as entities are expected to behave as good citizens by engaging in charitable activities such as supporting education, assisting the underprivileged people, and encouraging employees to participate in commendable projects. Companies must remain emphatic in revealing and disapproving unethical practices orchestrated by their employees. Managers have the task of ensuring that the companies comply with the tenets of CSR by updating employees about social responsibilities and monitoring their implementation (Ferrero, Hoffman, and McNulty 38)
Investing to earn profit is avaricious. Indeed, it is an irrefutable presumption in business ethics that businesses should have the interest of the society. It is from this service that they earn profit. Thereafter, they have the liberty to spend the fortune they earn based on their desire. Hence, managers have the responsibility of ensuring that the primary purpose of the company is to benefit the society as profit-making remains a secondary goal. Likewise, the manager of Thailand golf course has the responsibility of ensuring that his or her actions do not harm employees, community, and the ecosystem. As such, ignoring such a responsibility makes him or her liable for damages in line with the factors of moral liability.
The challenge that businesses face is the subjective nature of what the society considers moral. What one quota may passionately support, another wing will fervently condemn. For example, the golfers and fans of the sport are likely to support the idea of increasing more golf courses. However, they will ignore the fact that the sport affects the source of income of other inhabitants. They would be enraged by attempts of some groups of activities who prevent them from diverting water to keep the golf courses green. In a stark contrast, farmers who can no longer irrigate their farms, employees who are struggling with cancer and languish in poverty because of golf investors have seized the residential lands would find the company to be purely unethical. From this perspective, one would conclude that to determining whether a manager is morally responsible would depend on which side of the divide one supports (Kotler and Lee 76).
Conversely, in determining whether an act or omission could amount to being morally wrong, managers should refer to the ten doctrines laid down by the UN Global Compact. The principles address various issues concerning human rights, labor laws, conservation of the ecosystem, and the anti-bribery provisions. Companies are encouraged to integrate them into a company’s policies to encourage proper relationship with the human resource, society, and the state. Some of the core values include promoting corruption-free zone in the firm, equity, respecting the globally recognized human rights, utilizing preventive approach to resolving environmental issues, and encouraging eco-friendly technologies. The ethical responsibilities of a company can be summarized in three fundamentals. First, employees should not violate criminal activities while performing company-related responsibility. Secondly, workers should not engage in activities that may cause them to be sued for violating the civil law. Employees and the administration should avoid contaminating the company’s public image.
Just like any other company, the golf course is obligated to doctrines and norms of CSR. Evidently, several unscrupulous happenings have occurred following the escalation of golfers and golf courses in Thailand. For example, Traisawasdichai says that the golf courses were suspected of water-theft with an observer stating they dumped rocks in the river to divert or increase the volume water that needed to be pumped in the golf clubs (16). Such acts have caused the depletion of water resources. Moreover, the golf project continued to use pesticides that affected the health of the neighboring inhabitants, workers, and the ecosystem. It has contributed directly or indirectly to the insidious events of which it could have easily stopped by avoiding dangerous chemicals. Besides, the company cannot claim to be oblivious of the acts as the community and employees have expressed their discomfort with its habits.
Works Cited
Carroll, Archie, and Ann Buchholtz. Business and Society: Ethics, Sustainability, and Stakeholder Management, Connecticut: Cengage Learning, 2014. Print.
Dhiman, Satinde. “Products, People, and Planet: The Triple Bottom-Line Sustainability Imperative.” Journal of Global Business Issues 2.2(2008): 51-57. Print.
Ferrero, Ignacio, Michael Hoffman, and Robert McNulty. “Must Milton Friedman Embrace Stakeholder Theory?” Business & Society Review 119.1(2014): 37-59. Print.
Kotler, Philip, and Nancy Lee. Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause, California, CA: John Wiley & Sons, 2011. Print.
Savitz, Andrew, and Karl Weber. The Triple Bottom Line: How Today’s Best-Run Companies Are Achieving Economic, Social and Environmental Success — and How You Can Too, California: John Wiley & Sons, 2012. Print.
Traisawasdichai, Malee. “Chasing the little white ball.” New Internationalist 263(1995):16–17. Print.
In this research, my business “problem” goal was to choose the proper option and present the business model of a golf company startup in order to attract more people to golf and help them to enjoy this game. With the aim of providing the reader with appropriate and credible information, problem-solving strategies, methods, and techniques were used. The data I encountered was based on graphs and figures presenting growth trajectories, customer trends, and market. I utilized novel approaches that would attract more people. Among the possible solutions of the business “problem”, I suggested the introduction of women and youth into the golf market. Moreover, I supposed the idea of a new strategy concerning golf equipment, particularly of opportunity to remodel, renovate, and upgrade the existing facilities to reduce the cost of golf.
The reduction of membership fees and golf courses would perhaps catch the attention of people, too. In addition, the concept of geographical expansion was proposed by me as it was stated that most European countries proceed to register considerable growth in golf participation despite the economic downturn. Thus, thoroughly analyzing significant insights of the American golf scene, I proved that the “problem” could be addressed and suggested possible solutions containing significant and realistic ideas that seem like an innovative opportunity to make the world better to some extent. However, there is still something needs to be done in the future. I would like to continue my investigation improving available ways of “problem” resolving and proposing new ones (for example, individual training of golf club members) as well as creating a business plan to bring this project to life. Also, the implication of the paper is that it might be useful for startuppers in some degree.
Topgolf is a high-growth platform with favorable unit economics across its companies. It will benefit from Callaway’s solid financial position, which allows it to fully support Topgolf’s expansion ambitions at a low cost of capital. Both businesses are focused on golf and active-lifestyle customers. The acquired company will benefit from a compelling family of brands with reach across numerous channels, including retail, venues, e-commerce, and digital communities, thanks to Topgolf’s 90 million consumer contact points every year. Callaway’s golf equipment and soft products companies benefit from Topgolf’s efforts to introduce new players to the game of golf (Repar, 2021). The merged company’s industry-leading sales, marketing, and partnership infrastructure will enhance traffic, same-venue revenues, and new business conversion. The combined consumer reach of Callaway and Topgolf will result in enhanced promotion, exposure, and sales of equipment and clothing to golfers and non-golfers alike (Repar, 2021). A common innovation culture opens attractive long-term options, such as the ability to transmit information for teaching, exercise, and lifestyle across linked displays.
The company’s core platform, which is distinguished by immersive games, proprietary technology, and locally sourced, high-quality food and beverage, is a one-of-a-kind social destination for everyone. Topgolf locations are physically positioned to profit from customer preferences for outdoor activities because of their open-air, climate-controlled bays. In 2019, Topgolf served more than 23 million visitors from 63 sites throughout the world, including a strong pipeline of new openings, with more than half of customers identifying as non-golfers (Repar, 2021). Topgolf has a significant digital presence in the game of golf through World Golf Tour, a popular mobile golf game with 28 million subscribers as of 2019 (Repar, 2021). Topgolf’s exclusive, in-house gaming skills also enable novel sponsorship and consumer interaction options across the company’s linked digital and in-person platforms due to the company’s own in-house gaming capabilities.
Reference
Repar, K. (2021). Callaway golf: Leading the game’s renaissance with the Topgolf acquisition. Seeking Alpha. Web.
War Eagle Golf Ltd (WEGL), the producer of cheap copycat golf drivers, is facing difficulties with demand. After presenting its product at the World Golf Expo, the managers received valuable feedback from experts saying that, to get along with the competition, WEGL should customize its production. This decision will increase interest and demand and make prices 30% higher. Therefore, the new production strategy should focus on the customization of products while also shifting from the make-to-stock (MTS) assembly process. This paper will discuss how WEGL should change its production to have higher product demand.
Importantly, the current MTS assembly process is not suited well to Thompson’s new strategy of making semi-customized golf clubs. Therefore, the on-demand assembly option should be considered, that is, abandoning the push strategy and working with direct orders. This means that the production process will change tactically, although there is no need to outsource production. Instead of outsourcing, Butch Pearl can develop a rough plan of future work schedules and distribution of roles between employees, with possible training to better understand the new work processes. Outsourcing production entirely is a bad idea because it will be too expensive for the company to make a profit on sales, as Mr. Thompson hopes that the costs will not change significantly while the price for customers can be increased.
The production strategy will focus on customized products manufactured after the customers have placed orders for chosen product types. This will require optimization in assembly processes regarding human resource management, enhanced customer delivery logistics, and enhanced cooperation with supply chains. The technology needs will likely remain the same with minimal customization; IoT programs will be beneficial to improve supply and delivery (Brous et al., 2020). The benefits of the proposal include making customized products on time and on demand; potential drawbacks are increased spending on training and increased workload for employees.
Thus, the changes in the production for WEGL aimed at higher demand were discussed. Mr. Butch Pearl should make changes to the assembly, and delivery, and work with suppliers. The new processes should consider optimal HR management and training practices, and the introduction of IT technologies such as IoT to enhance logistics. There is no need for manufacturing outsourcing since the changes will affect human labor, logistics, and product management processes.
Reference
Brous, P., Janssen, M., & Herder, P. (2020). The dual effects of the Internet of Things (IoT): A systematic review of the benefits and risks of IoT adoption by organizations. International Journal of Information Management, 5(1), 1-12.