Business Model and Leadership Strategies - Essay Example

Economics Case Studies Case Study 1: The Oresund Bridge Introduction Oresund Bridge was opened up on July 1 2000. The bridge is part of a 17km that comprises of a submerged tunnel and an artificial island halfway. The bridge has a road and a railway network that is supported by freestanding pylons. The idea for the construction of the bridge started in the early 19th century. However, it faced criticism and opposition by the nationalists in the Denmark and Sweden. It was later opposed by the environmentalists on the basis of the welfare of the wildlife in Oresund. After the project was approved, George Rothne was mandated to design and Arups as the project engineer. The construction work for the bridge ended in March 2000 before being opened for traffic in July the same year[Jea10]. Reasons for Construction of the Bridge The bridge was intended to serve Denmark and Sweden to increase trade and boost the economic state of the two. The governments of the two countries found it necessary to link Malmo and Copenhagen cities through a bridge. That integration would result to increased cultural, economic and education that would add value to their businesses, information technology and in medicine. The other major reasons for the construction is solving the issue of unemployment that was more prevalent in Malmo than it was in Copenhagen. It would also allow individuals working in Copenhagen to live in Malmo where housing was cheaper and available[OEC03]. Challenges Affecting the Bridge The study concentrates in Oresund Bridge and identifying possible solutions that would be incorporated to achieve the objectives made during its construction. The two countries have experienced challenges regarding the intension they had when constructing the bridge. After experiencing a high number of traffic crossing the bridge during the summer, the number has decreased greatly. On the other hand, the trains connecting the Danish Capital, Malmo and Copenhagen are experiencing challenges running on time. The residents are arguing that the cost of using the bridge is too high for them to cross[OEC03]. The $2 billion project sponsored by the two governments was aimed at increasing trade within the two countries that would make the region a fast growing richest region in Europe. However, the ministers from the two regions are concerned about the fees paid by traffic accessing the bridge. Swedish trade minister, Sir Leif Pagrotsky has called for a tariff review, arguing that the cost of running the bridge is high acting as a barrier to integrating the region. In addition, the business firms between the two countries are restricting their staff from using the bridge on the basis of reducing the cost. The staff managing the bridge points out that the number of traffic accessing the bridge has to rise if the bridge is to pay in return[Jea10]. Oresund Commuting Fees Analysis Considering the prices set for commuting across the bridge, many of the populists from the region believes that it too high for them to use the facility. The fee set by the management team of the Oresund Bridge is discriminating. Different people pay different fees depending on the number of trips they make monthly or yearly. The table below shows the fee distribution for different groups or individuals. Fig1.1 Note: The table tabulates the passenger car prices in SEK Fees quantity price(SEK) Cash ticket 10 trips card BroPas Oresund commuter Oresund business Yearly fee 320 320 One way price 375 277 185 1-4 times/year 300 5-1000trips/year 148 1001-100000trips/year 142 10001-trips/year 136 1-16 trips/month 185 17-50 trips/month 38 50>trips /month 185 Source: 0resund Bridge, prices Recommendations to Oresund Bridge Management After the construction of the bridge, the Oresund region experienced growth and development in all economic fields. However, at hand has been a trivial deterioration in growth on the Danish side and economic sustainability on the Swedish side. These factors can be viewed from different perspectives. It is believed that after its opening to commuting, daily commuting increased drastically after the completion of the bridge. However, the limit projected and proposed has not been achieved. According to Gerard Gilbert (2012), security across the bridge should be enhanced if the objectives of the bridge are to be met. The occurrence highlighted by the BBC news where a man was murdered and the body left halfway the bridge might scare some commuters. Through surveillance of the region, the number of commuters may increase drastically as they would feel safe and protected. In addition, the number of tourists who may be willing to visit the region may increase the fee that the bridge management corrects. Encouraging investors to initiate their business investment in Oresund would be a milestone that would increase the number of people using the bridge. It would be of impact on the resident’s income that would make them afford the fees assigned. Furthermore, it would encourage migration into the region, labor mobility and integrate the region fully. Apart from the above considerations, cultural exchange would also facilitate the integration process. When fully integrated, both Swedes and Danish would feel more open to visit any of the regions regardless of their nationality. This would increase interaction and tourism in the region. Case study 2: Rescue Nissan Introduction The motor industry has greatly influenced business and trade through their sales. It is a manufacturing industry that employs a great number of people in the world. There are many motor industries that exist. However, this paper pays special consideration in analyzing the Nissan Motor Company. Carlos Ghosn joined the Nissan Motor Company in 1999. In the year 2001, he was appointed as CEO of Nissan Motor Company. In addition, in April 29 2005, he was appointed the chairman and also the president of Renault S.A. Nissan has gone through great changes in his leadership. After taking over the leadership of Nissan, he applied a rapid results initiative by closing unprofitable businesses, slashed costs, and sold unprofitable items in the company. The 2011 japan earthquake left Nissan totally damaged leading to the closure of the major manufacturing plant. The paper focuses on the Nissan Company’s ailing moments under 7 out 8 years of loss. Challenges Affecting Nissan Motor Company The motor industry globally is facing serious challenges despite the increased market demand. There are several combined factors that continues to affect the growth of the motor industry. Some of these factors include technological advancement, globalization, and competition due increase in the number of motor companies that are on a rise. The challenges facing this sector can be summarized as below. Nissan has gone through hard times before and after Ghosn took over its leadership. After his emergence as the CEO, Ghosn identified the issues down falling the industry as: Lack of profit orientation, not enough analysis of their potential customers, too many management protocols, lack of urgency in dealing with problems that required urgency, and lack of common goals and vision from the management[Wil132]. The motor industry has also faced challenges in providing an energy friendly powered automobile. This has mounted pressure on the company despite the various research done. The other pressing problem with the Nissan Company is the fluctuation of yen compared to US dollars. When the Japanese Yen loses power over a dollar, the company experiences loss of its sales in the US. All these challenges have affected the profitability of the company. In addition, scarcity of steel and other body parts has led to the company closing some of their plants. According to Jathon Sapsford (2004), the company is forced to close down some 5 lines due to the absence of steel for 5 days[Wil131]. Analysis of the Nissan’s plight In 2006, Nissan dropped its global production by 21% every year due to falling markets especially in US. This form of the drop was as a result of a fall in the demand of their brands. Carrying out enough market research is essential to allow the industry to continue in its production. Market research and brand analysis play an important role in the general production company. Nissan should focus on strategies that will promote its reputation and boost the production process. The plight of Nissan is influenced greatly by reduced demand and understanding the dynamism in the global market. There is a need to diversify in different brands targeting different customers and ensuring their taste is catered for in the production process[Wil131]. Recommendations To maximize their profit, Nissan has to embark on an initiate that will help them utilize technology in their production and service delivery to their target customers. Technology would ensure that their production is proportional to their market demand. The earthquake that hit japan affected the company greatly, leading to closure of the largest production plant in the region. Safety measures to control the effects of natural catastrophes would be effective for ensuring that they are able to manage the loss that may occur[Nin09]. In addition, the management should focus on setting out a common vision and mission that will help them in attaining the set objectives. Focusing on the Ghosn management strategies, Nissan should set strategies that are long running despite the short term goals. It should focus on its supply chain philosophy that would help it in the management of the entire Nissan Corporation. Such measures would help identifying their pitfalls and work on them before the plight holds[Nin09]. Conclusion. In both companies, business model and leadership strategies are important. In the new era of technological advancement, research plays a greater role in identifying what the consumer of the products feels about their products. Identifying the market analysis9 will help understanding the, market change and rectify the mistakes before a disaster hits. In the case of Oresund bridge, encouraging businesses within the two countries, Sweden and Denmark would be fruitful they are to achieve their objectives. On the other side, Nissan should focus on how they can utilize the available materials to use them in the production. The unavailability of steel should be a step forward in carrying out research on the locally available materials that would help them in reducing the cost of production[Mar07]. References Jea10: , (Dahlberg, 2010), OEC03: , (OECD Territorial Reviews OECD Territorial Reviews: Oresund, Denmark/Sweden 2003, 2003), Wil132: , (William Schmidt, 2013), Wil131: , (William Pride, 2013), Nin09: , (Nina Rakowski, 2009), Mar07: , (Guffey, 2007), Read More