An Opportunity for Platinum Builders Inc. to Import Seismic Base Isolation Technology - Research Proposal Example

International Persuasive Essay: An Opportunity for Platinum Builders Inc. to Import Seismic Base Isolation Technology from Okumura Corporation Institution: Letter of Transmittal The Manager, Platinum Builders Inc., Dear Sir, Re: An Opportunity for Platinum Builders Inc. to Import Seismic Base Isolation Technology from Okumura Corporation Here is a proposal detailing an opportunity that Platinum Builders Inc. can tap into to develop into a market leader in construction business in California. Seismic base isolation technology is a tried and tested way to construct structures that will remain integral and strong even during earthquakes. California lies within a seismic fault line and the risk of earthquakes is real. Assurance by a construction company that this is taken care of is a potential source of competitive advantage over rivals. The best quality of such devices can be imported from Japan and Okumura Corporation has been established as a possible trade partner. Much gratitude is offered to employees from both companies for their insightful information into their operations. I look forward to an opportunity to discuss this proposal and answer any questions that may arise. Thank you in advance. Table of Contents Letter of Transmittal………………………………………………………………. ii Table of Contents………………………………………………………………….. iii Executive Summary………………………………………………………………… iv Introduction…………………………………………………………………………. 1 Background…………………………………………………………………………...1 Purpose of Proposal…………………………………………………………………...2 International Factor……………………………………………………………………2 Objectives……………………………………………………………………………..4 Discussion……………………………………………………………………………..5 Summary of Findings…………………………………………………………………7 References……………………………………………………………………………...9 Executive Summary The State of California is in a belt predisposed to earthquake occurrences. Construction companies are required to meet building specifications by authorities to ensure safety in times of a seismic activity. This threat to business may be transformed into an opportunity to achieve and maintain market leadership by Platinum Builders Inc. through importation of the best technology against seismic activity; base isolation devices, from Okumura Corporation in Japan. The challenges that exist in international trade especially in terms of communication and legal considerations are all surmountable. Base isolation devices from Okumura Corporation are of high quality and meet the accreditation standards in Japan hence they are safe for import. They assure safety, low insurance charges and continuity in businesses and livelihoods; qualities that a construction company should aim to be associated with. It is recommended therefore that Platinum Builders Inc. seizes this opportunity to develop into an industry leader in construction. Introduction Leading companies strategically position themselves to achieve and maintain market leadership through SWOT analyses. Spotting opportunities for growth in the environment is an important aspect of business strategy especially in the construction industry where differentiation and overall cost leadership may be difficult to achieve in the bid to generate and maintain competitive advantage. Platinum Builders Inc. may however find that an analysis of its threats presents an opportunity for growth when an international perspective is drawn into consideration. Background: Platinum Builders Inc. and the California Constructions Industry Outlook The outlook of the building construction industry in California tends to incline towards considerations of seismic activity in the construction of structures. This is understandable considering the fact that the State of California lies in a region that is earthquake prone. Choi (2010) provides important insight into this by explaining that the Pacific North West region covering the area from Vancouver Island in Canada to Northern California lies in a subduction zone which is essentially a situation in which tectonic plates on the surface of the earth interlock. Majority of earthquakes occur in subduction zones and the threat posed by them in the Pacific North West region has been documented indicating the fault lines in a State like California and possibilities of earthquakes of magnitude 9 on the Richter scales. The implication of this for a company such as Platinum Builders Inc. which primarily operates in California involves meeting the standards and legal requirements for construction so as to ensure safety of its structures and legality of operations. There is however another perspective to look at this; it is an opportunity to expand business and be a market leader through the adoption of technology that ensures building integrity during earthquakes. Through going a step further and adopting base isolation technology, Platinum Builders Inc. will have surpassed the requirements and attracted attention as a safety-first construction company. Where else to source for this technology if not Japan? The country has experienced many earthquakes and its base isolation technologies have helped avert massive destruction of property and loss of life. It is for this reason that Platinum Builders Inc. may find it useful to import base isolation materials from Okumura Corporation, a leading Japanese construction company and exporter of building materials especially specializing in base isolation technology. Purpose of Proposal There is a huge opportunity for Platinum Builders Inc. to expand and become a market leader through importation of base isolation materials from Okumura Corporation and a detailed demonstration of this opportunity is the specific purpose of this Communication. The challenges that may be faced due to the fact that this is international trade will be explored. The facts about seismic activity in California will be provided followed by demonstration of the capabilities of base isolation technologies in maintaining the integrity of buildings in the event of earthquakes. Base isolation technology will be discussed in detail and statistics about performance highlighted. The International Factor Platinum Builders Inc. prides itself in being the one-stop-shop of all construction needs in California and faces heightened competition from several existing players in the industry alongside new entrants. Taking advantage of this unique business expansion opportunity is likely to set it apart from the rest. Okumura Corporation has a great deal of experience in constructions involving base isolation technologies as evidenced by the fact that it was among the pioneers in this industry in Japan. The choice of Japan is because it lies in a region of major seismic disturbances and its interventional technologies have been tried and tested which offers a great deal to learn for not only the authorities in California but also companies such as Platinum Builders Inc. It is expected that Okumura Corporation will also see the business opportunity in collaborating with Platinum Builders Inc. The exact nature of the business involves importation of base isolation building materials by Platinum Builders Inc. from Okumura Corporation. The first concern that arises when Okumura Corporation is mentioned is the challenges that proposed partnerships may face in light of the fact that these are two establishments that are miles apart, operating in two different environments besides a host of several other hiccups cooperation may face. These concerns are justified to a large extent as they are major determinants of the feasibility of this proposal. It is thus imperative that all the possible barriers to business interactions between Platinum Builders Inc. and Okumura Corporation be explored followed by explanations as to why this should not hinder business alongside proposed solutions where these barriers may be serious. Communication is a major concern since many business interactions are largely dependent on proper and smooth flow of information. Wertheim (2008) discusses the importance of communication in business quoting a figure of 75% as the time spent by business organizations in interpersonal situations and stating that a root cause to most organizational problems are due to poor communication. Jandt (2010) goes a step further and specifically studies the importance of intercultural communication in business transactions in the global aspect. He establishes that intercultural communication competency is of particular importance to international trade and states that effective and successful business transactions on an international level are dependent upon the communication abilities of both parties. The issue of language barrier can thus not be denied as a challenge between Platinum Builders Inc. and Okumura Corporation. This is however not a problem that can hinder the proposed business as evidenced by the level of multilateral trade between Japan and America. Okumura Corporation’s management has also adopted the use of both English and Japanese as official languages in operations as their website indicates (Okumura Corporation, 2011). Closely related to the challenge of communication are the cultural aspects that are obviously different between the two countries. These are however overcome when effective communication is achieved. The other challenges that arise due to international factor in business transactions revolve around climatic and geographical differences and trade regulation differences by the relevant authorities. However, in this case, the similarity in predisposition to earthquakes instead is the source of the proposed opportunity hence is not viewed as a challenge rather as a stepping stone. Two considerations for the legal aspects arise in the international factor at play between Platinum Builders Inc. and Okumura Corporation. First, California and Japan amongst other earthquake prone regions follow the same International Building Code (Jones, 2011). In fact, California has a great deal to learn from countries such as Japan hence the issue of quality at USA entry points will not be a barrier. Differences in trade regulations between the two countries may pose challenges but since bilateral trade between the two countries is already established it is expected that this will not be a major problem. Objectives of this Proposal This proposal aims at achieving the following: To highlight the need for base isolation technologies in California To provide information on seismic base isolation technology To provide information on capabilities of base isolation technologies To convince the top management at Platinum Builders Inc. to pursue the business opportunity of importing base isolation materials from Okumura Corporation. Discussion California is an area prone to seismic activities coming only second to Alaska as the area experiencing the most of such activities in the USA (Sparks, 2011). Among the most notable earthquakes to be noted in the state include the Fort Tejon shocks in 1857 which destroyed buildings and fell trees at the Fort. In 1872, an earthquake in the Sierra-Nevada fault line system killed 27 people and caused massive destruction of property besides being accompanied by many aftershocks. The earthquake of 1892 in Santa Rosa destroyed nearly all brick structures around its epicenter while another one in San Jacinto in 1899 caused similar damages and destruction. In 1906, one of the greatest earthquakes to happen was the state struck which killed hundreds of people and left a trail of massive destruction estimated at $500,000 in San Francisco. Another big earthquake in Long Beach Island in 1933 sow the first seeds of the need for earthquake resistant constructions in the US as it was accompanied by massive losses and untold suffering with hundreds of people falling victim. In 1952 the earthquake of Kern County severely destroyed property and killed scores of people with an observation being made that well designed structures handled the earthquake well while the rest felt the maximum impacts of the earthquake. Numerous minor and localized shocks occurred between these incidences and have continued to do so until now (USGS, 2009). The reality of an earthquake is not a foreign idea in California as the residents, authorities and construction companies can attest. The need for structures that can survive earthquakes has never been more real. Among the stakeholders that should be at the fore front in ensuring that buildings are safer under seismic activity are the local and federal authorities and construction companies themselves. Guidelines and legally enforced requirements are already in place in California hence all the companies are at a level state in this regard. Going one step further is perhaps a strategy that can separate a company such as Platinum Builders Inc. from the crowd and set it apart as a notable industry leader. An avenue through which Platinum Builders Inc. can pursue better construction for seismic withstanding is through the use of base isolation technologies that have already been used successfully in countries such as Japan. According to Pan et al. (2004) seismic base isolation is a concept that is about 25 years old in the most earthquake prone regions in the world. It has found wide use in countries such as New Zealand, China and Japan. Its considerations for major use in Japan began after the Kobe earthquake of 1995. From application in small buildings mainly for testing purposes, seismic base isolation has found wide use in taller structures extending to over 60-storey buildings. Naeim, Martin and Bzrev (2002), state that base isolation technology consists of three basic elements; a flexible mounting, damper/energy dissipater and a means of provision of rigidity. The principle behind base isolation is to increase the flexibility at the base of a construction in the horizontal plane through the isolators/flexible mountings. The dampers are then used to dissipate the amplitude of the motion caused by an earthquake. The isolators or flexible mountings used in Japan are of three types; natural rubber bearings, high damp rubber bearings and lead rubber bearings. These are either used solely or in combinations with each other. They are installed on top of the basement walls or at the columns and at the plinth of buildings for those without a basement. The types of dampers available in Japan include steel dampers that are used in conjunction with lead ones which is a combination that has proven to be quite successful. Dampers allow for high initial stiffness and ability to withstand large numbers of shock cycles. Dampers are added to the isolation layer in order to reduce the relative displacement on the layer of isolation and disrupt the horizontal motion as soon as possible after the first motion (Pan et al. 2004). The materials used for base isolation in Japan are of the highest quality possible with an accreditation body being charged with the responsibility to approve the devices described above. Standard tests for the stiffness, yield force, damping and friction coefficient are done alongside tests for ultimate limits; maximum lateral strain and compressive strength. All the given characteristics are tested for their dependence on age, temperature, compressive force, velocity and lateral strain which can be withstood thus assuring that the products availed in the market are of the dependable quality (Pan et al. 2004). The base isolation devices that meet the accreditation requirements are then published in catalogues by the manufacturers of which Okumura Corporation is an example. Besides the assured stability and building integrity in times of seismic activity, base isolation is also accompanied by other benefits including lower insurance costs for the constructed buildings. It also ensures that critical facilities such as hospitals and police departments are in operation to help other constructions in times of earthquakes besides assuring the safety of irreplaceable items in places such as museums. Continuity of business is assured alongside enhancing the feeling of safety amongst people (Leung-Wai and Nana, 2004). All these advantages are what Platinum Builders Inc. can assure to its customers and hence acquire an upper hand in the market. Summary of the Findings and Implications Platinum Builders Inc. operates in California where it has been indicated that quake threats are not unexpected. This threat to operations of Platinum Builders Inc. can be turned into an opportunity by doing more than the minimum necessary legally in building construction; Platinum Builders Inc. can import base isolation devices from Okumura Corporation and use it to gain a competitive advantage of commitment to safety. The international factor considerations that may appear as barriers are all surmountable challenges and the quality of the base isolation devices is assured through rigorous checks and the fact that they have been put to actual test as evidenced by recent quakes in Japan. In case rivals decide to do the same, Platinum Builders Inc. will have the advantage of an already established source in Okumura Corporation from where it can source more devices and supply to the rest of such companies. Another alternative that arises is production of own base isolation technology which can be undertaken after first establishing an identity as the home of these devices in the industry through initial cooperation with Okumura Corporation. It is recommended that the management at Platinum Builders Inc. considers this huge opportunity of expansion and growth into a market leader before the rest of her rivals can establish it. References Choi, C. Q. (2010). Earthquake Threat Lurks For United States, Too. Environment. Retrived 3 September, 2011 from http://www.livescience.com/8011-earthquake-threat-lurks-united-states.html Jandt, F. E. (2007). An introduction to intercultural communication: Identities in a global community. Sage Publishers, California. Jone, L. (2011). What California can learn from the Chile, New Zealand and Japan quakes. Los Angelos Times. Retrieved 3 September, 2011 from http://articles.latimes.com/2011/apr/08/opinion/la-oe-jones-earthquakes-20110408 Leung-Wai, J. & Nana, G., (2004). Economic impact of seismic isolation technology. Berl, New Zealand. Okumura Corporation (2006). Building technology: Seismic isolation system. Retrieved 3 September, 2011 from http://www.okumuragumi.co.jp/en/technology/building.html Naeim, F., Martin, A., & Brzev, S. (2002). Advanced technologies in housing construction. British Columbia Institute of Technology, Canada Pan, P. et al. (2004). Base-isolation design practice in Japan: Introduction to the post-Kobe approach. Journal of Earthquake Engineering, Vol. 9, No. 1, 147–171. Sparks, D. (2010). About the California building codes & earthquakes. San Francisco Chronicle. Retrieved 3 September 2011 from http://homeguides.sfgate.com/california-building-codes-earthquakes-2592.html USGS, (2009). California earthquake history. US Department of the Interior. Retrieved 3 September, 2011 from http://earthquake.usgs.gov/earthquakes/states/california/history.php Wertheim, G. E. (2008). The importance of effective communication. Northeatern University, USA. Read More