Vitamin C Testing of the Ribena Drink by Glaxo Smith Kline - Assignment Example

RIBENA CASE ANALYSIS Name Institution Professor Course Date Introduction Jenny Suo and Anna Devathasan, two New Zealand students, undertook a school experiment with the intention of testing for traces of Vitamin C. Testing of the Ribena Drink by Glaxo Smith Kline (GSK) showed almost no trace of Vitamin C. It is essential to note that the advertisement of the product claimed “…the blackcurrants in Ribena have four times the Vitamin C of oranges.” The two students decided to write to the GSK. Following no response from the institution, they decided to telephone the organization (Jacques, 2008). To their surprise, the organization did treat them rudely, thus ignoring their questions. The claims of the two students were then featured in a local TV consumer affairs program, which had suggestions that they forward their findings to the NZ Government Commerce Commission. After subsequent investigations or inquiries, the Commerce Commission saw the need to take GSK to court on charges in relation to misleading advertisement. In the course of this trial, GSK pleaded guilty, thus attracting fines from the court. In addition, GSK had the obligation to place advertisements in major metropolitan New Zealand newspapers with the intention of correcting the mistakes. GSK focused on making substantial efforts to contain the issue geographically to New Zealand. Nevertheless, the story gained disproportionate publicity across the world. Strategic management is one of the essential issues, which are vital in the enhancement of the image and reputation of the business entities within the market and industry of transaction (Goestch & Davis, 2014). This makes it essential for business entities or companies to adopt and implement appropriate strategies to handle emergence of issues, which might hinder the image and reputation of the company. From this perspective, GSK was caught in a ‘perfect storm’. At a broad glance, this case focuses on identifying and illustrating valuable lessons in relation to strategic organizational strategy and practice. In the first instance, the case highlights the need to ensure the existence of internal management systems to respond adequately and early in relation to changes within the situation. Secondly, the case highlights the need to have and incorporate consistent strategy towards addressing demands, expectations, and preferences of the organization’s customer base. Similarly, the case enhances understanding of the changes in the internal and external environment. The case helps in recognizing the importance of genuine and meaningful apology, as well as public dialogue with reference to reputational management in case of wrong situations within the market and industry of transaction. Question 1: Identify and discuss a set of coherent actions that the organization may have taken to avoid the legal and reputational situation, which resulted from their actions? Ribena should have focused on adoption and integration of potential coherent actions, which might have been appropriate in avoiding the legal and reputation situation from actions of the organization. In the first instance, the organization should focus on implementation of the aspects of strategic leadership. This refers to the process of managing an organization’s strategy-making process effectively and efficiently (Carpenter & Sanders, 2013; Hall et al, 2013). Strategic leadership should focus on adoption of a sustainable reputation at the top, with effective board oversight, appropriate strategy-setting mechanism, business planning, branding, and image construction. From this perspective, there is substantial for the organization to have exploited effective and efficient board oversight in relation to matters of strategy, policy, execution, and transparency in the course of reporting (Volbreda et al, 2011). This is vital towards realization of effective corporate governance, which is a powerful factor in sustaining the image and reputation of an organization within the market and industry of engagement. Strategic leadership enables leaders or managers to execute their duties and obligations in demanding and challenging situations, thus lasting for a long time. In this context, strategic leadership is the foundation for successful utilization and exploitation of the strategic management processes in pursuit of competitive advantage in the market and industry of operation (Hitt, Ireland, & Hoskisson, 2014). In order to implement this management concept effectively and efficiently, Ribena should focus on determination or specification of the image, as well as the character or reputation the firm is seeking or pursuing over time within the contexts of conditions such as threats and opportunities. Secondly, Ribena should focus on utilization of strategy formulation to minimize or avoid the legal, as well as reputational situation. This relates to the task of determining and selecting the appropriate strategies in pursuit of competitive advantage in the market and industry of operation (Stahl et al, 2012). Effective formulation of the strategy enables business entities to marshal, integrates, and allocates resources, capabilities, and competencies with the intention of aligning these resources properly with the external environment (Volbreda et al, 2011). In addition, appropriate formulation of strategies rationalizes the vision and mission of the organization in association with ideal actions in the achievement of such elements (Pech & Slade, 2006; Pech & Slade, 2005). In the course of formulating ideal strategies for handling the situation, Ribena should focus on collecting and analyzing information relating to markets, technology, worldwide finance, customers, and transformation in the global economy (Rosemann & Brocke, 2015). Business entities tend to achieve competitive advantage through satisfaction of the needs and preferences of a group of customers, thus the perfect platform for competing effectively in individual product markets. Most successful entities often find ways or approaches to satisfy the needs and expectations of the current and emerging customers. In certain cases, organizations might decide to adopt diverse actions inclusive of ‘babying their best customers’ with the intention of maintaining competitiveness in the market and industry of operation (Hitt, Ireland, & Hoskisson, 2014). The organization should have dealt with the issue differently in relation to engaging the students on their inquiry. This relates to incorporation of appropriate changes and transformations to the customer care services with the intention of improving the relationship between the organization and the target audience. In the third instance, the organization should focus on the ‘big picture’. This relates to the willingness of the business entity to adapt to the changing circumstances. From this perspective, the organization should consider exploitation of its resources, capabilities, core competencies, and expertise to focus on the achievement of improved image and reputation. Prior to the scandal or ethical issue, Ribena had a massive capability and image in the industry of operation. The organization should concentrate on this image and capability, thus concentration on the ‘big picture’ (Leih, Linden, & Teece, 2014). The approach should start will integration of apologies on the illegal and dishonest advertisement on the composition of the product with reference to Vitamin C. Similarly, the institution should consider utilization of trade shows and campaigns on trying to enhance the image and reputation of the firm with reference to the existing issues and perception of the public on the company (Slade, 2003; Hopkin, 2014). These attributes will be ideal in elimination or minimization of the negative aspects, which might affect the performance of the organization. The organization should also consider the assessment of the external environment (Chun, 1999). This is through execution of competitor analysis while assessing the level of competition within the industry. Moreover, external environment analysis might consider evaluation or examination of the threats and opportunities with the intention of enjoying the perfect platform for adoption and implementation of strategies. Similarly, the organization should adopt and integrate risk management techniques with the intention of identifying such vulnerabilities, which might affect or limit the ability of an organization to achieve the goals and targets at the end of the fiscal period (Bettis et al, 2014; Dyer & Song, 2014; Stead, 2013; Dess, Peng, & Lei, 2013). Question 2: From an organizational perspective, identify and discuss potential that may emerge in implementing your suggestions? Gaining Competitive Advantage In order for an organization to achieve competitive advantage in the market and industry of operation, there is need to acquire the essence of strategic competitiveness. This refers to the ability and potentiality of an organization to formulate and implement a value-creating strategy in accordance with the demands and expectations of the target audiences within the market and industry of operation (Hill, Jones, & Schilling, 2014). In this context, a strategy refers to an integrated and coordinated set of commitments, as well as actions focusing on exploitation of the core competencies in pursuit of competitive advantage. In the course of choosing a strategy, firms tend to make accurate choices from competing alternatives in deciding on the appropriate acquisition of strategic competitiveness. For an organization to achieve competitive advantage, it is essential for such entities to be able to adopt and implement a strategy, which is beyond duplication by diverse competitors. In addition, competitors should also find it too costly to try to imitate such strategies, thus provision of the competitive edge within the industry of operation (Spaseska & Vitanova, 2012). It is ideal to note that the value of organization is the significant source of competitive advantage. In the course of delivering or generating this value, an organization must adopt and implement an appropriate strategy to ensure that employees and managers conduct themselves with the essential honesty in pursuit of competitive advantage in the market and industry of operation. In addition, there should be a clear organizational culture in association with the core competencies, capabilities, and resources illustrating on how the organization executes its duties and obligations within the market and industry of operation (Stead, 2013). The value-creating strategy should align with the organizational culture to limit the essence of resistance from the employees (Lopez-Nicolas, 2011). These attributes are ideal in enabling the organization to enjoy competitive edge within the market and industry of operation. Internal Analysis In the course of addressing this issue or the ethical problem facing Ribena in relation to the dishonest advertisement, there is need to execute an extensive internal analysis. In this context, the organization should focus on the assessment of the weaknesses and strengths with reference to the strategies in gaining competitive advantage (Chun, 1999). Under the influence of globalization, business entities tend to adopt and implement a global mind-set in execution of an analysis to the internal environment. This relates to the ability of an organization to analyze, understand, and manage an internal environment in diverse ways, which are not dependent on the assumptions of a single nation, culture, or context. From this perspective, global mind-set recognizes the fact that firms must possess substantial resources and capabilities, which facilitates understanding of and appropriate responses to competitive situations under the influence of country-specific factors and unique societal outcomes (Greiner, 1972). Internal analysis requires organizations to examine or evaluate the firm’s portfolio of resources and bundles of heterogeneous resources, as well as capabilities under the creation of the managers in pursuit of competitive advantage and quality image in the global context. From this perspective, individual firms possess at least some resources and capabilities, which are missing in other business entities. Resources are essential in the generation of capabilities. Some of these capabilities lead to the development of a firm’s core competencies or its competitive advantages within the market and industry of operation (Sull, Houlder, & Stratgy, 2012). It is ideal to note that decision makers focus on understanding how to leverage the firm’s unique bundle of resources and capabilities in the course of executing internal analysis. Categorically, Ribena should focus on the assessment of resources, capabilities, and core competencies, as critical sources of competitive advantage in the market and industry of operation. Implications of Changes in Internal Environment Business entities tend to focus on the utilization of resources, capabilities, and core competencies in pursuit of competitive advantage in the market and industry of operation. This makes it essential for the organization to improve aspects of its internal environment to enhance provision of value and quality to the consumers, thus satisfaction of the needs and preferences of the consumers in the market and industry of operation. Similarly, organization needs to integrate appropriate strategies to facilitate development and growth of the internal environment, thus improvement of the strengths while minimizing the weaknesses in pursuit of competitive advantage at the end of the fiscal period (Schoemaker, 1995). A change in the internal environment might have substantial implications on the competitiveness of an organization within the market and industry of transaction. This is because of the ability of the resources, capabilities, and competencies to determine the profitability and revenue levels at the end of the fiscal period. Moreover, these elements of internal environment determine the volume or incidents of sales. This makes it essential for the organizations to assess the internal environment continuously with the intention of addressing the needs and preferences of the consumers within the market and industry of operation (Pech et al, 2006). These aspects make it ideal for the employees and managers to promote the growth of the internal environment to maintain the competitive edge in the market and industry of transaction, thus improved image and reputation (Schoemaker, 1997). From this perspective, internal environment tends to affect the image and reputation of an organization within the market and industry of operation. Question 3: What might be the implications of your suggestions for organizational and management practice? Discuss this from a risk management perspective Risk Management Risk management refers to the systematic process of understanding, evaluating, and addressing these risks with the intention of maximizing the chances of objectives while ensuring that business entities, individuals, and communities become sustainable. In addition, risk management examines the opportunities uncertainty brings, thus enabling organizations or institutions to be aware of new possibilities (Pritchard, 2014). In order to achieve effective and efficient risk management, organizations need an informed understanding in relation to the relevant risks, an assessment of their relative priority, and rigorous approach in the course of monitoring and controlling such uncertainties (Hull, 2012). Furthermore, effective risk management should be proportionate to the size and nature of the business entity in the global context. Management Practices There are diverse management practices or managerial responses in relation to the achievement of the goals and targets of risk management. For instance, it is the obligation of the management to be available to enable the organization to handle vulnerabilities and uncertainties, which might hinder or affect the image and reputation of the business entity within the industry and market of operation (Smith, 2005). Secondly, effective management practices in relation to management of risks should incorporate appropriate or efficient communication of the plan of action. This is vital in the assessment of the risks and management of such uncertainties by all stakeholders in pursuit of competitive advantage in the market and industry of interest (Hull, 2012). Management should also consider utilization of facts rather than ‘spin’ in the course of managing risks effectively and efficiently. During this situation, management of the organization should have focused on expressing sensitivity to the affected parties, thus the issue of empathy in addressing the demands and expectations of the customers in the area of interest. It is also ideal for the managers to delegate duties to other entities within the organization (Kash & Darling, 2008). This is appropriate in pursuit of competitive advantage, as well as effective management of the risks. Effective management should consider elimination of conflicting messages in the course of addressing issues relating to the image or reputation of the firm. Firms need to speak in one voice while addressing the public relations issues, thus the perfect platform to reduce or eliminate such problems (Regester & Larkin, 2008). There is also need for the management practice to demonstrate a plan for how the organization plans to avoid a repeat of issues such as dishonest advertisements in the future (Rampini et al, 2014). Effective risk management contributes to positive gains in relation to the reputational growth and development in the area of interest. In the first instance, organizations can focus on exploitation of effective management to enhance the image among the customers and other relevant stakeholders, thus the opportunity for the business entity to increase its profitability levels (Aebi et al, 2012). Secondly, management practices can help improve the reputational aspect of the organization through enhancement of the culture in relation to creation of value for the achievement of competitive advantage against numerous competitors in the market and industry of organization. Finally, the organization can exploit this approach to enhance external relations with individuals and other entities in pursuing competitive advantage under the influence of the resources, capabilities, and core competencies. Effective Management Effective management relates to the ability of the managers to plan, organize, staff, lead, control, and direct organizations in pursuit of the goals and targets at the end of each financial year (Elliot et al, 2010). From this perspective, effective management requires informed knowledge on the existing resources, capabilities, and core competencies of an organization to create value in accordance with the demands and expectations of the consumers within the market and industry of transactions. In addition, effective management must relate to the ability and potentiality of the managers to handle or manage risks effectively and efficiently to enhance the image and reputation of the business entity (Caponigro, 2000). Effective management tends to have diverse benefits in relation to the growth and development of the business entity. In the first instance, effective management can enable business entity to plan effectively and efficiently for the potential risks or uncertainties, which might hinder the image and reputation of the organization. Secondly, effective management can be a plus in the course of reducing costs of production and delivery of products and services to the consumers because of the ability of managers to incorporate strategies that detect wastages or defects (Pancic, 2010). The organization might also benefit from effective management through exploitation of resources, capabilities, and core competencies within the industry of transaction. This is vital in motivating employees while reducing the employee turnover rate. Effective management enables an organization to adopt and implement appropriate resources and strategies to gain the competitive edge in the market and industry of interest. Conclusion Conclusively, effective management relates to the ability of the managers to plan, organize, staff, lead, control, and direct organizations in pursuit of the goals and targets. Effective management should relate to the issue of risk management with the intention of enhancing the image and reputation. 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A., Ireland, R. D., & Hoskisson, R. E. 2011. Strategic Management: Competitiveness and Globalization. Cengage Learning, Andover, UK. Read More