Schindler Elevators - Essay Example

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Being a big business in today’s world requires a company to maintain prestige,a strong and constant cash flow, and loyal customers. It also means holding a very strong reputation, which can easily be brought down to shame with a single incident…
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Schindler Elevators
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Download file to see previous pages Large corporations have a responsibility to ensure that they fulfill their promises of quality and confidence. While large businesses have thousands of customers, dissatisfying one customer or not fulfilling customers’ expectations can significantly affect the reputation of a company. Companies rely upon word of mouth, and after building a reputation that has prevailed for years, one incident can change the perception of their customers forever (Ouchi, 1981, p. 82). Once a company makes a mistake, they will take numerous actions to compensate the customer or let the public know their viewpoint regarding the incident. Some mistakes are forgivable and only affect the company’s short-term sales while other mistakes may even cause the company to file bankruptcy or go out of business (Ohmae, 1982, pp. 45-48). Accidents that cause death, injury, or serious mistreatment of customers may result in a boycott of the company’s products, as well (Schendel, 1979, p. 45). Smaller mistakes such as faulty products or malfunctioning goods may only result in the company having to replace the products and refund the customer (Barney, 1986, p. 1236). Discussion Japan is a market with very high context culture and very strict standards of adherence to cultural practices. The Japanese are not sympathetic towards other cultures and do not allow international companies to take advantage of using different social norms when they conduct business in Japan. Japanese customers expect extremely high quality standards and do not tolerate even slight deviances from those standards. It is mandatory to please Japanese customers and mistakes are not easily forgiven. Operating in this rigid environment was the renowned company, Schindler Elevators. The company was established by Robert Schindler in 1875 in Germany. Little by little, the company grew and expanded into other areas such as Asia, Africa, and the Middle East. Today, Schindler is the world’s leading supplier of escalators and elevators and is responsible for making some of the world’s best transport systems. It is also responsible for transporting approximately 700 million people daily (Schindler, 2006; Fink, 1986, pp. 76-79). However, Schindler Elevators is seriously suffering from decreasing market share and sales in Japan and it is even unable to find employees in the Japanese market because of an accident that occurred with one of its elevators. Schindler’s bad reputation also caused it to lose service contracts. The accident that got Schindler into trouble occurred in 2006 in Minato Ward, Tokyo. A 16-year old boy was getting off a Schindler elevator with his bicycle while the doors were ajar. The elevator began to move upwards and the boy was crushed between the doorframes and died instantly. The Japanese were outraged. Immediately following the accident, Schindler gave a press conference. While Schindler sympathised with the victim’s family, the company also maintained that there was no fault in the quality standards of the elevator and it asserted that the company was very particular about its safety standards. This press conference was followed by a series of additional press conferences in which Schindler explained the accident but did not apologize to the victim’s family or meet them. The Japanese expected an immediate and complete apology, but it took nine days for the Schindler Company to apologize after the accident, and the Japanese did not consider it a full apology (Japan Times, 2009). The public perception was that the company was arrogant and lacked high quality standards and a sense of responsibility. The Japanese are not used to companies that do not perceive responsibility as an ...Download file to see next pagesRead More
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