Best of the Blogs of Sharjah, Entry 3
Several students blogged about the "New School" article in Black Enterprise magazine about "how a poor job market is affecting how business schools compete for students and what you can expect from today's M.B.A. program."
Haifaa Hassan had these observations:
As mentioned in Barney's book, "Gaining and sustaining competitive advantage", there are [a] few questions that [are] important when it comes for analyzing the firm's strengths and weakness which is, in our case, the employee. First of all, there is the matter of the value of the employee, in other words, what can this employee by his years of experience add to the organization? Second,there is the question of rareness, which reflects what makes the chosen employee unique or different than others. It doesnt necessary mean the MBA degree; it can also be the training programme that he has joined.
Diana also had interesting observations about this article, particularly in the way that MBA programs can differentiate themselves and their products:
The strategy that can really differentiate between each college is the way they interface with their students, the services and supplies that they can provide the students with, by implying the third component of the business concept by Hamel, Customer Interface, where one of its elements is information and insights where refers to all of the knowledge that is collected from and utilized on behalf of their students, if they can attend an evening program, or work online whenever they can on the program.
Lulwa, who is not convinced that MBA's are necessarily valuable, has a novel solution- more education!
Also, if someone went to graduate school immediately after graduation, he/she will lack experience. I think that one can learn more in the working field than in schools. Hence, we cannot consider a masters degree as a valuable resource unless it is combined with a Ph.D. According to the school there are millions of unemployed graduates, if having a master’s degree will solve the problem why don’t they just go a head and apply for a program.
Nader nicely summed up the "New School" article this way:
Job market is the most competitive market since the supply way exceeds the demand. Knowing that 10.2 million in population this year competed for three million jobs only has started controversial issues. As a result, the bargaining power of buyers (employers) has increased; moreover, the rivalries among existing employees increased in order protect themselves from potential entrants (new grads). Therefore, most of new graduates are going for MBA after getting their undergraduate degree as a basis of differentiation to distinguish them and be unique.
Lina (the Warrior Princess) Osman applied three frameworks - Porter, Hamel, and Barney - to the New School article. Here's a sample of how she applied the Business Concept Innovation framework:
Moving on to Hamel's theory, if we think of MBA students as firms competing in the market, then we can state that they must have a core strategy in order for them to succeed. One element of Hamel's core strategy that MBA graduate can use is the basis for differentiation. They have an advantage with their degree, no doubt about that, but they also need to know what the best way is for them to compete differently from their rivals. The key word here is "differently". Furthermore, according to Hamel, these students with MBA degrees have a strategic asset which if used properly, will enable them to succeed.
Seniors at Senior Level
Mohammed A. has issues with the argument made in the article "Seniors at Senior Level", about the valuable contribution older workers can and do make in the workforce.
I partially disagree with what BILL GLAUBER said in “Seniors At Senior Level”. I’m a 22 years old undergraduate student who will get in to workplace in couple of years. Couple of years after work, my ambition is to be a CFO in one of the biggest companies in the world. If seniors are still around their, me other young people will not have the patient to wait for senior to passaway. I think after a person reaches 60 he/she must retire. I don’t think that they will still be efficient anymore.
Question for Mohammed: will professors be exempt from this rule? Abdul Aziz Alami read the same article and notes that it is often hard for older workers to leave:
There was something in the article that caught my attention about George Dalton, there happens to be a similar story in saudi arabia, this one has to do with the giant saudi company Gazzaz, the CEO is now over 80 years old and is basically running the managment of the companyon his own. he loves his job and cant see himself without it, it has become part of him. when you start off as a little boy working in a space and paying for meter by meter land and then you make your way to the top, its hard to let go.
Nailya sees positive and negatives associated with employing seniors. She used the four-resource questions in this manners:
I believe that kind of people might be very helpful in some businesses. Such people with their willingness and experience might make up the most important and valuable resources for the company because they enable the firm to respond to environmental threats and opportunities. As we know from Barney’s framework, resources and capabilities are valuable if and only if, they are reduce the firms costs or increase its revenues compared to what would have been the case if the firm did not possess those resources. Since such people with their experience and abilities to work as George Dalton might increase the costs of the company, he represents a valuable resource to the company. They also might serve as a rare resource for the firm since not many other competing firms might possess the same or similar employees. In addition, such employees might be hard to imitate resource for their competitors due to the fact that social complexity might make the resource costly to imitate.
Tofol has an excellent application of Baron's "4-I" framework to Peter Brown's "Selfishness" article. It should be read in its entirety. I quote her thought-provoking summary here:
This article reminds me of the philosophical discussion surrounding selfless acts, which leads one to conclude that no act is truly selfless. It has been a long held belief of mine that no one individual is completely selfless because, even when conducting the most seemingly altruist act, one is left with (at the very least) a feeling of satisfaction. The New Yorkers that were surveyed by Quinnipiac University strike me as honest rather than "selfish". Whilst union workers fully comprehend that the minimal wages and cost-cutting approach that is taking on by Wal-Mart will be detrimental to their futures as employees, they are also aware of their benefits, from those same policies no less, as consumers. As employees of Wal-Mart or of smaller rivals of Wal-Mart, union workers would suffer from Wal-Mart's policies. However, as consumers, the same union workers would find the policies beneficial as they lower the prices of their household goods. Therefore, the New Yorkers surveyed in this case were honest in illustrating their "love/hate" (Brown, 2006) relationship with Wal-Mart, and Brown portrayed that relationship very clearly.
Other articles
Several students wrote about articles that they selected themselves. Mahdi, whose blog is interestingly entitled "Bald Trump", wrote about the entry of Masafi, the Middle Eastern bottled water company, into the Japanese market:
First of all, I would like to explain why it’s very important for Masafi or other company to enter the Japanese market. Japan implies one of the highest standards and very restrictive regulations on importing goods from other parts of the world, especially the food products. Getting the approval from the Japanese government will enhance the confidence of the company it self and will lower the barriers to enter other countries. Masafi obtained the approval from Japan in a record period of time with no changes or additional steps to the production system. In addition to the credibility, it can be considered as a global certificate or a visa to enter any other country below or with the same level of standards and regulations.
Omair had a very interesting, well-written post using the resource-based-view of the firm to analyze Royal Caribbean International's plans to spend $1.42 Billion on a massive new cruise liner. And speaking of "cruise", look for the multiple references to films and certain famous actors.
Do I smell a mission impossible? Well not exactly. Clearly, direct duplication is as relevant a threat as any. The question is not whether the ship can be duplicated but whether it will be duplicated, and if so, when? Cost disadvantages are high for Carnival. It could risk losing its existing customers from an inevitable rise in package costs for its existing target market, budget minded individuals. Remonstrations in the minds of the Carnival executive are aplenty. This brings us to an important revelation. That which creates value for some might not do so for others. Royal Caribbean feels that Project Genesis will take them where no cruise line has gone before. Carnival on the other hand does not share the same sentiments about their potential ocean liner.
Yousef analyzed the resources associated with Nokia's introduction of a pocket sized PC. Here's what he said about the question of imitability:
It depends how Nokia will manages its competitive advantage. An important point to stat, Nokia had prolifically used Linux software and ignored others like Microsoft Windows for mobiles (previously used by Motorola). Since Linux is an open source software programmers could freely download, implement and reengineer software and distributing it with barely mentioned costs. So the question here, would the next step Nokia is going for is to Patent its software?
Fahad obviusly pays very close attention in class because he blogged about something I mentioned as an example in our discussion of Barney's framework:
After discussing about Barney’s theory, one point which was brought up in class was about Amazon.com where it hired the entire IT staff of Wal-Mart. Is it duplication, substitute or something else? Well I think its duplication because I think that duplication is not just using the exact same idea; however it is copying the core or base of the idea, and even developing it. Let’s say I am the first person to sell things online, and it was clothing for example. Well it would be a substitution to selling clothing on a retail store, however if anyone intended to sell anything other than clothing online then it would be duplication because the core idea which was selling products online is used by someone else.
Faisal Hadi studied an article about BenQ's acquisition of Siemens mobile phones unit. He raises an important question:
Why didn’t BenQ try to develop its name in the Mobile phone industry instead of acquiring an already established firm? The most logical reason I was able to think of was high barriers to entry. BenQ would have needed capital requirements, access to distribution channels, and product technology in order to market its products effectively and efficiently. Lacking all these resources, it was a wise decision to acquire an already established company. However, in such an industry, rivalry is very intense among competitors and speed and innovation is a priority. Consumers in this industry tend to stick with one brand. BenQ-Siemens should try to position them selves in a unique way to be perceived as different from its competitors.
Mohamed Mutahar has a very nice post analyzing four types of resources at General Motors related to its plans to "hire nearly 300 workers and invest $545 million in five Michigan plants." Interestingly, instead of linking the analysis to competitive advantage, he links it to two concepts in Hamel's framework:
In conclusion, I think that GM is employing “strategic flexibility” in regards to this Michigan investment. This is because they are trying to generate higher profits by staying perfectly tuned to the market and avoid getting trapped in dead-end business model. In specific, by this investment GM is applying the “operating agility” wherein its able to quickly refocus its efforts in better placed to respond to changes in demand and thereby even out profit swing.
Hoda wrote about the recent upsurge in profits at Hewlett Packard. Her conclusion?
In my opinion, one of the elements that are most responsible for its increase in revenue and profit margin is “core strategy”. According to Hamel, a company’s core strategy is “the essence of how the firm chooses to compete”. In this example, HP chooses to compete by focusing on its “business mission” and specifying its “basis for differentiation”. HP’s business mission focused on the printers. This company introduced the printers into the market and after that it found out new uses for its inkjet printer by making printers capable of printing large advertising signs or quickly producing large print jobs. Therefore, the success of the company is because of considering the more selling of the printers, the more selling of ink and toner as Mr. Hurd described this as a “demand creation model”.