Assignment No. 3 Questions to Answer: 1. Show What is hypercompetition? Is the outcome positive for corporations in the IT industry? Answer: Hypercompetition can be defined as organizations' use of competitive tactics to disrupt the competitive advantage held by industry leaders. It typically occurs at a rapid pace. 2. What is your opinion of Apple having a code of conduct for its suppliers? What would Milton Fr iedman say? Contrast his view with Archie Carroll’s view. Answer: Apple has a supplier code of conduct and a relatively vigorous auditing effort. Despite those efforts, The New York Times reported in 2012 that some of the suppliers audited by Apple had violated at least one aspect of the code every year since 2007. Critics have pointed out that for a variety of reasons Apple is relatively lax in its enforcement of the code. The New York Times reported that Apple conducted 312 audits over a three-year time period finding more than half the companies in violation and 70 core violations. Yet, despite all the evidence, Apple has terminated only 15 contracts over the past five years. Recent surveys of over one hundred companies in the Global 2000 uncovered that 64% have some code of conduct that regulates supplier conduct, but only 40% require suppliers to actually take any action with respect to the code, such as disseminating it to employees, offering training, certifying compliance, or even reading or acknowledging receipt of the code. It is important to note that having a code of ethics for suppliers does not prevent harm to a corporation’s reputation if one of its offshore suppliers is able to conceal abuses. Numerous Chinese factories, for example, keep double sets of books to fool auditors and distribute scripts for employees to recite if they are questioned. Consultants have found new business helping Chinese companies evade audits.
3. Why should a profit-making organization be socially responsible to its various stakeholders? Answer: Although difficult at times, it is nonetheless important for businesses to determine who their stakeholders are and what they want. The corporation systematically monitors these stakeholders because they are important to a firm meeting its economic and legal responsibilities. Employees want a fair pay and fringe benefits. Customers want safe products and a value for the price they pay. Shareholders want dividends and stock price appreciation. Suppliers want predictable orders and bills paid. Creditors want commitments to be met on time. In the normal course of affairs, the relationship between a firm and many of its primary stakeholders is regulated by written or verbal agreements and laws. Once a problem is identified, negotiation takes place based on costs and benefits to each party. (Government is not usually considered a primary stakeholder because laws apply to everyone in a particular category and usually cannot be negotiated.) 4. What is stakeholder analysis? Explain the steps taken to achieve the identification and evaluation. Answer: Stakeholder analysis is the identification and evaluation of corporate stakeholders. This can be done in a three-step process. The first step in stakeholder analysis is to identify primary stakeholders, those who have a direct connection with the corporation and who have sufficient bargaining power to directly affect corporate activities. Primary stakeholders include customers, employees, suppliers, shareholders, and creditors The second step in stakeholder analysis is to identify the secondary stakeholders those who have only an indirect stake in the corporation but who are also affected by corporate activities. These usually include nongovernmental organizations (NGOs, such as Greenpeace), activists, local communities, trade associations, competitors, and gov ernments. Because the corporation’s relationship with each of these stakeholders is usually not covered by any written or verbal agreement, there is room for misunderstanding. The third step in stakeholder analysis is to estimate the effect on each stakeholder group from any particular strategic decision. Because the primary decision criteria used by management is generally economic, this is the point where secondary stakeholders may be ignored or discounted as unimportant. What does hypercompetition mean in business?a situation of extreme competition, where companies must try even harder than usual to have better products, sell more, etc.: The telecom company is preparing for another year of “hyper-competition”, focusing not only on adding new subscribers but also on creating new services for existing users.
How does hypercompetition affects management in a positive way?In today's business environment, hypercompetition is focused upon making quick decisions intended to disrupt the competitive advantage of market leaders. These types of decisions are now centered to create a competitive advantage through strategic maneuvering.
What is the impact of hypercompetition on competitive advantage?Hypercompetition repre- sents a state of competition with rapidly escalating levels of competition and reduced periods of competitive advantage for firms.
What impact does hyper competition has on the industry?Hypercompetitive market implications
Under hypercompetitive conditions, companies cannot enjoy long-term advantages. It only lasts a while. New companies emerge with a competitive advantage. But, the strategic maneuverability of their competitors quickly erodes and destroys it.
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What is hypercompetition is the outcome positive for corporations in the IT industry?
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