IB Business Management

Another Business Management story today with the news that Starbucks founder, Howard Schulz, is standing down as the company CEO, a role he's filled on three occasions.

IN this case, it seems that the Starbuck's boss is going to face scrutiny of the company's working practices, not least its industrial relations and the seemingly antagonistic position that it's adopted in relation to trade unions. It raises one or two questions about corporate ethics...

A detailed analysis in the Guardian of the current state of play regarding John Lewis, with the prevailing view seemingly that the company, like many, faces challenging times but different views about how to tackle this. 

For many analysts, it seems that the group have rather lost sight of its core business and the move to end staff ownership might damage both staff morale, the brand and remove its USP. However, it's clear that it's in a bind - however, the notion that the company wants to "expand into financial services and build to rent above Waitrose stores", strikes me as singularly unimaginative and redolent of a business in decline. 

Watch this space - and see how this story is going to unfold in the months ahead.

An interesting story about offshoring and the implications of this for the Toblerone brand, as they are no longer able to use the Matterhorn image on its packaging.

Mondelez are going to start producing the iconic chocolate in Slovakia, but in doing so they are unable to advertise its "Swissness". Will it affect the popularity of the brand though?

Just the very best sort of article for Business Management students, with the Guardian looking at the fate of Morrisons since it was taken over by the giant US private equity firm Clayton, Dubilier & Rice (CD&R) for £7bn.

It looks at a range of issues: the marketing mix, brand perception, the way in which the deal was originally financed and the implications of all of this for Morrison's performance, perhaps most obviously in relation to its declining market share.

Or course, the counter-factual is that the company could have gone in this direction irrespective of its new owners, but it's a fascinating look at how organisational cultures can collide. 

A lovely Business Management Monday morning starter for 10, with the news that BrewDog are entering the Chinese market, having partnered with Budweiser China. Classic application of the Ansoff Matrix by 8 o'clock, anyone?

It's also interesting to note that this isn't being universally approved of - not least in the present geopolitical environment - and others are pointing the incongruity of supposed 'punk' BrewDog partnering with Budweiser. 

Espionage in the market for courier services with firm DX Group having been accused by a rival, Tuffnells Parcel Express accusing it of having offered bribes to gain access to confidential corporate data.

Is this sort of behaviour ethical? Will it have any effect upon the brand or reputation of DX Group? I'm not sure that it will have much of an effect in a much maligned sector. 

This could go on lots of boards - but I've put it here, in that it's a nice case study of a well-established brand having to manage change in a sensitive fashion. Given the global nature of McDonalds, and the ethical implications of job cuts, it's a CUEGIS dream.

How do you survive on the High Street in the current business environment? This BBC article looks at Flannels, Monsoon and Mark & Spencer, all of which are still opening new stores. 

It's an interesting read, and highlights how every store needs to find its own value proposition in order to survive. 

An example of change in action, with this BBC article looking at the future for car dealerships, suggesting that new models of buying cars and the banning of new petrol and diesel car sales from 2030, meaning that staff will require retaining, and, in all probability, there will be fewer of them. 

Furthermore, instead of making an average profit of 7% per car, the dealerships are being squeezed by car manufacturers, with some - notably Audi and DS - looking to set-up their own directly-owned showrooms. 

However, existing dealers are confident that there is a still going to be a place for them in any future market.  

You can't say that BrewDog doesn't believe in sailing close to the wind - not only was it's anti-sponsorship of the World Cup badly received but it has had another advertising campaign - launched via e-mail - banned for intimating that drinking a 'fruit' beer would count as one of your five-a-day.

Interestingly though, can you argue that even with the ban, the marketing campaign has succeeded? It's another instance where the firm's name is in the media and if the average consumer is suitably 'punk' then this sort of edgy behaviour might appeal to them.

Fans of the ethics of mining companies are likely to be unsurprised by the news that Glencore has been fined - again - for a series of corruption cases in the Democratic Republic of Congo. The latest fine pushes this year's fines to $1.6bn

And then there's the kicker - as the article notes - "Despite the fines Glencore is expected to make record profits of around $3.2bn this year.." So, from Glencore's perspective, the marginal principle might suggest that they continue with their corrupt practices.  

Id never come across B Corp status before, however, it seems that it's an ethical standard that has been formulated by an organisation called B Lab. And now BrewDog have lost this status in the aftermath of BBC coverage of the business and an open letter from some of its employees criticising the organisational culture of the business. 

Will it adversely affect the brand? I'm not convinced the average beer consumer will be overly bothered. 

And here's an assessment of the organisational culture of the John Lewis Partnership, with the editor of Retail Gazette identifying it as the key feature of the organisation's identity, and arguing that diluting this is going to have an adverse effect on both productivity and, potentially, revenues.

As she notes, the founder's aim was "not to maximise profits but to generate “sufficient” profit for its purpose" and anything that deviates from that runs the risk of destroying the brand. 

The John Lewis Partnership is thinking of changing its much vaunted staff-ownership model. The potential plan, apparently the brainchild of the Chair, Dame Sharon White, is to seek funding for a majority stake to invest in data analysis and Waitrose's supply chain. 

It's not guaranteed to take place but the firm are looking for £2bn, although ditching 70 years of history, and the brand image associated with it, might have adverse effects for the business too. You never know perhaps reducing executive pay over the preceding 20 years might have helped...

There's quite an easy answer to this - income elasticity of demand, for economists - but for Business Management students, the underlying issues are perhaps more interesting.

This is worth a read. 

Another lovely example of product development - and an application of the Ansoff Matrix, as Starbucks have launched a new range of products, olive oil infused coffees, initially in the Italian market. 

Starbucks only has 20 stores in Italy, an economy with a cafe culture based on independent, family-owned cafes, and has found it difficult to establish itself.  

Some interesting Business Management material here, with sandwich chain, Subway looking to sell the business. You might start by asking pupils what type of business it is? I doubt many will know that it's a family business. 

Thereafter, you might think about the reasons for looking to sell the business - yes, costs are higher but is it a classic case of the owners looking for an out before the product life cycle starts to take effect. I wonder if, unlike classic fast food options, like McDonalds, Subway's products and brand isn't strong enough to become an enduring feature of the market. 

For those of us of a certain age, the name Spud-u-like, might spring to mind. 

A lovely example of the importance of marketing in getting a product flying off the shelf, the apparent rise in popularity of tinned fish can be attributed to many things, not least skilful marketing strategies - and you might use the 4Ps to analyse this as well as thinking about how social media has amplified this trend. 

However, I would also add that there are other factors in play - the changing macroeconomic environment and, perhaps, the fact that more 'exotic' forms of tinned fish have been a discount store - i.e. Lidl and Aldi - staple and their popularity might have been picked up on by more upmarket retailers. 

A nice bit of hijacking corporate marketing with a group of subvertisers putting up 400 alternative marketing campaigns, calling into question the environmental credentials of Toyota and BMW and highlighting the environmental costs of their SUVs. 

Brompton have shortened their supply chain in the wake of increasing tension between China and Taiwan, This is a complex operation, but they are trying to encourage existing suppliers to use production facilities in other locations, and further complicated by the fact that China is the world's largest market for the folding bike company. 

This is just an interesting clip for Business Management students: it costs $1million per day to run Royal Caribbean's Symphony of the Sea, a boat with 6,000 passengers per week, with a crew of 2,400 staff. 

How is this achieved? It's the relentless pursuit of efficiency, with 30,000 meals produced every day in small kitchen, all waste disposed of, and the ship kept afloat.  

It's a fascinating illustration of everything from ship design and touches on all elements of Business Management. 

This article about the nature of global brewing, and the production of 'foreign' beer in the UK, for the British market. Does it really matter where a beer is brewed?

For some people it does, with Czech brewers, Budweiser Budvar, only brewing in its home town of Budweis, and arguing that this gives its beer a unique taste, and authenticity. 

Contrast this with other beers, notably relative newcomer, Molson Coor's "Madri Excepcional", a Spanish style lager, brewed in Yorkshire in league with joint venture partner, La Sagra Brewery. 

So why have such beers become so popular? The answer is in the branding which imbues them with 'sophistication' in the eyes of the average drinker, apparently. 

I've put this here, rather than on my Microeconomic board in the hope that some of my Business Management students might want to read it. It's a lovely example of how firms in the supermarket sector are looking for new ways to compete, although I wonder whether the ill-fated rollout of Tesco's Jacks brand might also apply in this instance.

Is Asda likely to be successful in the convenience store market, or will it, as Tesco's attempt did, result in damage to its brand image. 

A remarkable clip looking at Amazon's fulfillment centres, looking at working conditions and the high risk of repetitive strain injuries with research suggesting that Amazon's employees are twice as likely to be injured than colleagues working in other companies' warehouses. 

Something to think about with regard to business ethics, and in a CUEGIS context.