EXAMPLE: Student 2; responding to initial post: \"Hey CC, great post! I agree th

Question

EXAMPLE: Student 2; responding to initial post:

"Hey CC, great post! I agree that based on their historic trends, IBM is slow to change and technology is only getting faster. I do think however that CEO Rometty's decision to increase efforts into cloud computing was wise for the company. As many companies, websites, and organizations (both online-only and brick-and-mortar locations) are increasing their awareness of the information available through cloud computing and the analysis that are also available with it, IBM can have the ability to bounce back here in North America. Doing so can also give them the ability to expand to other countries if the current plan works well enough, assuming the market hasn't been lost to a competitor large or trusted enough to compete against.

I don't see it being a negative decision for IBM to focus in the Americas because they need to strengthen their core if they want to stay relevant, not expand to something larger than they can currently handle. Focusing on potential future areas of service in a time of decline with current operations seems like a bad idea, even if that means a competitor get first crack at the area"

Now I need you to read the discussion post down blow and please respond to it. I will give you thumps up depending on the quality of the post.

"Identify at least two examples of firms that may have paid too much attention to the top three levels of the pyramid to the detriment of the “economic responsibilities” level of the pyramid. What are the implications of this for strategic management of the firm?

One example that I think of off the top of my head as it has been an issue in at least one or more of my textbooks as well as in the news is Elon Musk and Tesla. Elon Musk has a very clear vision for the company in which he founded: to create clean energy cars. He has since worked on emphasizing the affordability of the vehicles. Now, the reason I bring up Elon Musk as potentially focusing too much on the top of the pyramid is because he felt recent pressure from his shareholders. In response to this pressure, he announced that he was very strongly considering taking the company back to being privately held. He even stated that the funding for such was secured. It was very recently announced that he will not be taking the company back to being privately held as the shareholders and the Board pleaded and believe it to be the best approach to the mission and vision. Previously, Tesla has been very successful and it will be interesting to see how staying publicly held continues to affect the company after such turmoil. I believe it is possible that there was a large divide between shareholders stake and Elon’s mission and vision for the company.

Another example that I am aware of is when the now retired CEO of Starbucks, Howard Schultz, chose to place his political views (against the policies of the current administration and Trump himself) above the shareholders. Due to this, there was great backlash that occurred from many Trump supporters. It quickly escalated to a boycott and the hashtag “#boycottstarbucks” became a top trending phrase on the popular social media outlet Twitter. Needless to reiterate, this sort of publicity and loss of business that occurred due to ethics created quite the problem and loss of business for Starbucks. The implications here are pretty clearly loss of profit as well as a larger customer base".

Sources Cited

Doubek, James. “Tesla To Remain Public, Elon Musk Says.” Business, NPR, 25 Aug. 2018, www.npr.org/2018/08/25/641803323/tesla-to-remain-public-elon-musk-says.

Winegarden, Wayne. “Unilever And The Failure Of Corporate Social Responsibility.” Forbes, Forbes Magazine, 15 Mar. 2017, www.forbes.com/sites/econostats/2017/03/15/unilever-and-the-failure-of-corporate-social-responsibility/#1c062b71498d.

Brooks, Chad. “Could 'Doing Good' Be Bad for Your Business?” Business News Daily, Business News Daily, 9 June 2017, www.businessnewsdaily.com/10003-csr-negative-impact.html.

Explanation / Answer

Corporate governance and organizational structure influences the profitability and long term survival of the corporations like Tesla and Starbucks. Tesla was successful in achieving its business vision and mission by adopting publicly held model of governance. Corporate social responsibility is one of the best tool to get huge customer base as well as a good brand level positioning . A business leader should avoid any political/ controversial views to post on social netwrok websites as it results in loss of business and switching of customers to other brand as a matter of bycott. It is true that in corporate management, the board of directors should control the behvior of the owner or promoters of the company so as to avoidance of any loss due to mismatch between ideology . To become a sustainable business organization, corporate governance, values and ethics towards each stakeholders must be given top priority by the management.  

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