Managing Global Relationships and Marketing Crisis - Coursework Example

Managing Global Relationships Name Course Lecture Date Table of Contents Table of Contents 2 Introduction 3 Relationship development 4 Rationale for developing the relationship 5 How the relationship can be developed 6 Benefits of the relationship 6 Managing marketing crisis 7 Effects of the marketing crisis 7 Implications for the case company 8 Response to the marketing crisis 9 Rationale for your responses to the marketing crisis 11 Conclusion and recommendations 11 References 13 Culp, S 2013, Supply Chain Disruption a Major Threat to Business, Viewed 13 June 2015, 13 Introduction Companies need to form formidable and lasting relations with their consumers, suppliers and their employees. This will eventually ensure the smooth learning of their operations. In regard to these the suppliers will always be supplying goods and other required raw materials on time leading to greater efficiency. The employees will also work diligently and offer high-quality products to the consumers on a timely basis. At the same time, companies need to ensure that they have minimal marketing crisis to deal with and in instances when they occur unexpectedly they need to have measures in place to address the issues. This will eventually ensure that smooth learning of the operations of an organisation thus leading to better services for the consumers and also the delivery of better products. This report is divided into two major sections that are relationship development and a case scenario on managing marketing crisis. The first section on relationship development will entail the identification of a key customer, individual or supplier that China Mobile Ltd ought to develop a relationship with. The section will address the following issues Who? – identify who to develop the relationship with. Why? – discuss the rationales for establishing such a relationship. How? – discuss how the relationship can be developed. What? – discuss what the benefits are and explain how they are beneficial to your company in the selected foreign country. The second section will outline the most appropriate actions that can be taken with the aim of addressing the marketing crisis. The following should in the second section; What? – identify and discuss what the effects of the marketing crisis are and discuss their implications to the case company. How? – outline precisely how you would respond to the marketing crisis Why? – discuss the rationale for your responses to the marketing crisis. Lastly, there will be a conclusion to sum up the main points of the report and it will also offer some recommendations for the company that they can apply in future to reduce delays in delivery of goods. Relationship development Companies approach to their suppliers ought to be included in the strategic plan since almost all businesses operating in the economy whether those that are service or product oriented dependently on suppliers. Many businesses seem to treat the suppliers as the least and backwards issues in their organisation. Companies argue that since they write the orders they have a dominant position and can therefore they can exploit it with irrational demands (Sheffi 2001). Thus, companies need to get reliable and good suppliers since they are essential for the company growth and health. The continuous delivery of reliable, high-quality products at reasonable prices plays an essential role in ensuring the smooth operations, success and productivity of the products in the market. China Mobile Ltd needs to form a relation with Axiom Telecom was founded by Faisal Al Bannai an Emirati entrepreneur and had four employees at the start of their operations in the year 1997 (Kerr 2010). With time, Axiom became the official’s distributor to various consumer brands in the United Arab Emirates including Blackberry, Nokia, Samsung and it has the largest market share in the Middle East. Axiom grew rapidly in 2001 and it even introduced their first retail outlet in the UAE. In the year 2003, Axiom launched their regional roll out and after time they have established their presence in Bahrian, Kuwait, Oman, Qatar, Egypt, Saudi Arabia and London, and India. In the year 2005, 40% of Axiom Telecom was acquired by Tecom, which is a member of the Dubai Holding (Nicholson 2010). Currently, Axiom operates and owns some stores through partner arrangement. Rationale for developing the relationship Business relationships are defined as the formal and contractual relationships that occur with the aim of offering regular brokerage or for regular business between companies and individuals. Irrespective of the profession, it is essential to maintain and establish relationships. A major rationale for developing the relations is to create a good image and reputation of the company. By meeting the expectations of the consumers in the mobile technology industry effectively, the two companies will seem to be attentive to the clients. This will eventually lead to greater number of consumers trusting the company and this will an added advantage for both companies (Simchi-Levi, Schmidt & Wei 2014). Additional due to the good reputation other companies may be interested in developing relationships and consumers are more likely to advocate and urge their close family friends and acquaintance to use the services of the company. Another rationale so long term profitability due to return customers. The aspect of selling a product to one person does not make a business it call for loyal and repeat customers fuel commercial success. China Mobile Ltd can move more towards the subscription of a business with the aim of maintain and establishing long term business relations with their clients and suppliers such as Axiom limited (Wieland & Handfield 2013). Thus they need to maintain and always high-quality services and products to the consumers and this will be an added advantage to them in that they will have greater number of customers resulting in greater sales and thus high profitability in the long run. How the relationship can be developed There are various ways in which businesses can form relationships with other companies for example through partnerships and joint ventures just to mention a few. The relationship between the two companies can be formed through joint ventures. Businesses irrespective of their size can make good use of joint ventures with the aim of strengthening their relationships and collaborating on various projects (Wieland & Wallenburg 2013). A joint venture is evident when two companies comes together and collaborate in some work or project. In joint ventures, the parties involved invest equally in the project in terms of time, money and effort so as to build the concept. Large corporations such as China Mobile Ltd can make use joint ventures with the aim of diversifying. Benefits of the relationship A major benefit of the relationship is that the two companies will be able to collaborate when making important decisions. The two companies can share their workload thus easing the burden on one of the company at the same time they can share and collaborate in various financial responsibilities about capitalising their business venture. The two companies can adopt their management structure that the owners deems suitable for the since they are not regulated in a similar manner as other corporations. Another major benefit of the relationship is that it will help China Mobile Ltd to increase their productivity, grow faster and generate greater profits. In instances when the venture is successful it will provide China Mobile Ltd with access to new markets in the UAE, increase their capacity, share of costs and risks among the two companies and access to a greater level of resources such as technology, specialised staff and finance. A joint venture in most instances enables the growth of companies such as China Mobile Ltd with them having to search for outside investors or to borrow funds (Nicholson 2010). Through joint ventures, China Mobile Ltd can be able to make use of Axiom Limited database to market their products and at times offer partners products and services to the existing customers. Through the relationship, the two companies can benefit in that they will be able to collaborate in research and development. Managing marketing crisis Effects of the marketing crisis The marketing crisis that is evident in the case scenario is poor management of part of the supply chain management that, in this case, is the transportation aspect. A wide range of people have differing ideas and views when to comes to the definition of the supply chain concept and majority of the people are usually wrong in their definitions. A supply chain is termed as the set of entities involves in the design of new services and products, producing of raw materials and their transformation into finished or semi-finished products and delivering them to the end user. A major effect of the delay of goods in the company is that it may lead to a delay in production. Manufacturing organisations cannot function without goods thus when the goods were not delivered on time there was a delay in production. This eventually leads to the wastage of valuable resources such as time and manpower (Kotter & Dan 2002). When goods are k not delivered on time the employee have no option but to stay idle but since they are employed the company will incur losses since they will have to pay them since they were available. Another major effect of the delay is that it may lead to losses for the company. In instances when company lack the goods to manufacture their products, they will incur losses in that their retailers and consumers can opt to use products from other companies as an alternative to their products. Some of the consumers may also shift entirely and thus the company will lose a considerable market share. Another effect of the management crisis is that it is likely to lead to stocks out and loss of profits for a company. Due to poor management of the supply chain there will always be late deliveries and this will eventually lead to stock out which will increase inventory wastes (Blanchard 2010). Implications for the case company One of the major implications of the marketing crisis to the case company is that it increases the company’s risk of reputational damage. Earning and maintenance of good reputation seems to be challenging for the already established and new businesses. When bad reputation emerges, a great number of businesses are portrayed as being dishonest, irresponsible and can seem to be only looking at their interests. In the modern business world, the supply chain of companies needs to be more important than ever before. Historically, most companies have opted to outsource part of their business for them to see improvements in pricing, efficiency and quality. Companies that are aiming at protecting their products from negative publicity need always to ensure that their supply chain is effective. Companies, therefore, need to increase traceability in the company’s network so as to reduce their exposure (Joseph, Joseph & Sunil 2002). In a traceable system, companies can be able to identify the products and materials, their exact location at the specific period. This was not the case with Soforgotten Pty Ltd since there were even not aware of the whereabouts of the missing goods. Problems in a company’s supply chain can affect a business in some ways. At the same time, the business may lose if other companies that they offer services to get to know about the marketing crisis. The case company is also likely to incur losses if the goods are not eventually found. The company that the goods are being delivered to cannot pay for goods that are not delivered. Thus, the company making the supplied is the one to incur the loss. Another implication of the marketing crisis is that their sales may be affected as well as their brand equity may be damaged. In general, a bad reputation mainly has negative effects on sales. Organisations that are not widely known can at times experience a boom in their business but this is usually an exception. In most cases, bad reputation always damages the long-term success of the already established businesses (Kotter & Dan 2002). The accessibility of products can also reduce and the potential consumer may even have fewer opportunities in purchasing the products. When the store owners and buyers change and have negative opinions about their company products and service, their choices will ultimately have an effect on the options that a customer can choose from. Brand equity can also suffer greatly as a result of brand reputation. In regard to this case, the company may be forced to return the goods to their stores if the company have been supplied with other goods (Nagurney 2006). Response to the marketing crisis One of the major ways of responding to the risks is by insuring the risk. Companies for a long period have been able to insure or evade a number of supply shocks such as the one that has been experienced by Soforgotten Pty Ltd. Finance departments have a number of options to hedge the risks associated with the supply chain. Companies are now insuring their company’s products from electric power interruptions and other natural calamities such as flooding. Since insuring has been made much simpler Soforgotten Pty Ltd can insure their disruptions due to the late supply of goods. As the insurance costs increases, the mitigation and anticipation of losses will be accomplished through the combination of various operational moves (Joseph, Joseph & Sunil 2002). The main goal here is to come up with a robust and flexible supply chain. This will call for a balance between efficiency, speed and risk. Another way to respond to the management risk is to cultivate and have alternate sourcing agreements. By relying heavily on one source of goods or other critical components, a company seems to be more vulnerable if there are expensive or prolonged supply gaps or delays (Gomez-Mejia, David & Robert 2008). A good example of such a scenario is when the Hurricane affected part of Central America in November 1998. The hurricane destroyed bridges, roads, factories and railroad tracks and other structures. This had a major effect on companies that had not formed a relationship with other suppliers and relied solely on one of them. Thus, so as to manage the management risk in future Soforgotten Pty Ltd ought to look for other suppliers and they can work with them at the same time. By doing so if one fails they will have another option to turn to thus reducing the losses and resources loss they may have experienced. Another way is ensuring that they have an alternate transportation medium in place. Smart sourcing strategies should also encompass backup plans for the various transportation tie-ups that may occur. Proper planning, as well as skilful implementation of alternative transportation, can play an essential role in helping companies overcome disasters of high magnitude as it was evident during the weeks after the September 11 Attacks (Culp 2013). The attacks led to tighter security in the customs checkpoints along the borders in airports and ports. This eventually led to long delays and these disruption shipments of critical components and parts. Companies also need to be prepared for new realities. It would not seem right to abandon just in time supply since companies have saved a lot in inventory by making use of just in time techniques. This benefit ought to be weighed against the costs of production delays and thus companies can come up with the best solution that meets their needs. Rationale for your responses to the marketing crisis The rationale for responding to the marketing crisis is to reduce instances of such a marketing crisis in occurring in the future. Additionally through the responses individuals will be aware of the alternative measures that can be adopted so as to deal with the crisis for example by having alternative suppliers of goods. It would seem like the best option for companies to have alternative sources of goods for their services not to be disrupted by the disruption that may occur in the supply chain. Through the availability of other suppliers, companies will not have to incur losses in terms of money and loss of valuable time. Additionally through the responses the company can take up to the alternative means of transportation to ensure that the goods are delivered on a timely basis. Based on these even if the company may incur losses the losses may be minimal since within a very short period other goods are likely to arrive. Eventually work in the company operations may continue as planned (Blanchard 2010). Conclusion and recommendations In conclusion, a relationship seems to be essential for all forms of businesses irrespective of the country and industry. Businesses need to form lasting relationship with the consumers, retailers and the suppliers. Through the formation of the relationship, companies can be able to venture into new countries all over the globe and with a lot of ease. This is based on the fact that their risk of operating in such countries is minimised by the relationship that they have formed since they can be able to share them. At the same time, companies need to ensure that they have minimal marketing crisis to deal with and in instances when they occur unexpectedly they need to have measures in place to deal with the issues. This will eventually ensure that smooth learning of the operations of an organisation thus leading to better services for the consumers and also the delivery of better products. Additionally companies need to address the various management crises that come up when they are running their businesses. By so doing, they will eventually be able to cater for any uncertainties that may occur and thus enhance their service and product delivery to the end users promptly. A number of recommendations can also be outlined to aid companies operating in the modern day business world in their operations and these recommendations are as follows; Companies need to develop relationship with companies that have a good reputation this will help them a lot in their operations in new ventures In relation to the management crisis, companies need to have more than one supplier of their goods. This will seem to be beneficial to them when one supplier is not in a position to deliver the required goods on time Additionally companies need to be prepared for any uncertainties that may occur at any time this means that they need to have backup plans in place at all times so as to reduce the crisis and risks. . It would not seem right to abandon just in time supply since companies have saved a lot in inventory by making use of just in time techniques. Companies also need to insure their operations ranging from the least one to the largest. By doing so, the losses incurred will be minimal. References Blanchard, D 2010, Supply Chain Management Best Practices, John Wiley & Sons, New Jersey. Culp, S 2013, Supply Chain Disruption a Major Threat to Business, Viewed 13 June 2015, Gomez-Mejia, L, David, B & Robert, L 2008, Management: People, Performance, Change, 3rd edition, McGraw-Hill, New York, New York USA. Joseph, M, Joseph, M & Sunil, S 2002, ‘Targeting a Just-in-Case Supply Chain for the Inevitable Next Disaster’, Supply Chain Management Review, Sept. /Oct. Kerr, S 2010, Axiom Telecom plans Dubai IPO". FT.com. Viewed 13 June 2015 Kotter, J & Dan, S 2002, The Heart of Change, Harvard Business School Publishing, Boston. Nagurney, A 2006, Supply Chain Network Economics: Dynamics of Prices, Flows, and Profits. Cheltenham, UK, Edward Elgar. Nicholson, C 2010, Axiom Telecom Cancels I.P.O. - NYTimes.com, Viewed 13 June 2015 . Sheffi, Y 2001, ‘Supply Chain Management under the Threat of International Terrorism’, International Journal of Logistics Management, vol. 12, no. 2, pp. 1-11. Simchi-Levi, D, Schmidt, W & Wei, Y 2014, From Superstorms to Factory Fires: Managing Unpredictable Supply-Chain Disruption, viewed 13 June 2015, Wieland, A & Handfield, R 2013, ‘The Socially Responsible Supply Chain: An Imperative for Global Corporations’, Supply Chain Management Review vol. 17, no. 5. Wieland, A & Wallenburg, C 2013, ‘The influence of relational competencies on supply chain resilience: a relational view’, International Journal of Physical Distribution & Logistics Management, Vol. 43, No. 4, pp. 300-320. Read More