7 Sustainability

Is the Oil-Tanking Industry Sustainable?

Posted on by spr1322cleahy

Due to the poor economy, the oil industry is having a rough time enduring transportation costs from country to country.  For decades, oil tankers have been the main source of transportation, carrying up to two million barrels of oil between the Middle East, Asia, and the United States. Unfortunately for the oil tanking business, operation costs over the past few years have been much more expensive than they have been in the past.  This increase in price makes the shipping of the popular and much demanded natural resource nearly impossible and not worth it.  Unlike what is usually the case, globalization in this situation for example is more costly to this particular industry than it would be to drill into our own soil.  The only problem is that we find a larger supply of oil in foreign countries than we do our own.

To get an idea of how much this is costing the oil firms, analysts look at the forecasts from previous years.  This collection of data has shown that the industry has lost more than $26 billion dollars in the past four years, and operation costs are higher than ever.  To operate one of these extremely large vessels, it costs anywhere from ten to twelve thousand dollars per day.  In 2007, operation costs peaked at $309,601 per day.  That is unbelievable! Because these carriers are only making roughly $7,000 a day, there is a huge deficit.  While such oil companies continue to lose so much money daily, they cannot possibly stay in business.  The supply chain is not working in favor of firms; therefore, sustainability of the business comes into question.  So what should these oil tanking firms do?  How can they cut costs?  Is it possible to adjust the supply chain or is it a lost cause?

I think that at such a loss like this, the amount of ships in operation should decrease drastically, causing less expenses to be paid.  That is the only way they can keep their heads above water, although they are already sinking in debt.  New York’s Overseas Shipholding Group filed for bankruptcy last year, and I am sure they will not be the last to do so.  I feel for these dying companies because many of them entered into contracts before the economic crisis occurred, and now they are stuck in a failing industry, losing more than they gained from the contracts to begin with.

Other possible options for consumers that effect the oil firms is innovation.  It is not uncommon to see on TV or read in the newspaper alternatives to oil resources.  At the Chicago Auto Show every year, concept cars are on display that use battery powered systems to replace oil.  These are more cost efficient and do not require the use of oil tankers.  What do you think will be the result of the oil industry failing?  How do you think consumers should react to this? How do you think the government should react to this?

Sources:

http://online.wsj.com/article/SB10001424127887323741004578418652461117968.html

https://www.google.com/search?hl=en&site=imghp&tbm=isch&source=hp&biw=1440&bih=686&q=oil+tankers&oq=oil+tankers&gs_l=img.3..0l7j0i5l3.1094.2780.0.2865.11.9.0.2.2.0.99.568.9.9.0…0.0…1ac.1.9.img.jaBIJkaaITU#imgrc=UIoFamHBsuSHxM%3A%3B47hJKcJOVD494M%3Bhttp%253A%252F%252Fwww.shippingherald.com%252FPortals%252F0%252FVessels%252Foil-tanker.jpg%3Bhttp%253A%252F%252Fwww.shippingherald.com%252FAdmin%252FArticleDetail%252FArticleDetailsTankers%252Ftabid%252F102%252FArticleID%252F8877%252FNordic-American-May-Double-Oil-Tanker-Fleet-as-Asia-Spurs-Demand.aspx%3B1190%3B1074

 

 

Wrong CEO, Crazy Damages!

Posted on by f1222sghatila

Wrong CEO, Crazy Damages!

Someone might think that a big company might have all the resources and very intelligent people working because they can afford to do so. In addition, those people will make the right decisions to improve the quality of work and increase the profit in the long run. J.C. Penny is one of the big companies that with one critical decision they lost almost a billion dollar. The hired the wrong person, which lead to critical changes that did not work out in the favor of J.C. Penny and increasing their profits. When Ron Johnson was announced as the new CEO of J.C. Penny the stock prices was $34 and within 2 years, the current stock price is at $14. The reason behind such a dramatic change is the structure of J.C. Penny. The CEO made changes to update the entire store and eliminate the coupons. Johnson did not pivot the idea that start off small and once people accepted the change and wanted that change increase though out the nation. Johnson took a big leap and caused J.C.Penny’s regular customers to look elsewhere for their purchasing needs.

Myron Ullman who was the CEO before Johnson had agreed to go back to and reverse the changes implemented by Johnon. He has agreed to stay until J.C. Penny has the right CEO. The changes made by Johnson eliminated the middle-market customers, which where their target market. Even though someone might think that updating the store and keeping a low price while eliminating coupon will cause more people to come is not necessarily true. Ideally, any idea sounds good but pivoting the idea is to make changes without losing a lot of money. Ulllman’s plan is to change things back and bring back the lost customers what where their target market but getting someone to come back after they have lost the trust is somewhat hard. Ullman has the niche to fix things, which he has done before and J.C. Penny is counting on him to bring back the people and profit into the stores again. His biggest challenge will be to remind the customers that what J.C. Penny was before and nothing has changed.

Quality of management makes a huge difference in the success of any company. Being in this state and losing a lot of money is very critical for J.C. Penny. If they continue to do so they will soon have to declare bankruptcy and that is a whole other situation. Being in economic crises right now and extreme competition from places like Macy’s and Kohl’s’ it will be hard to J.C. Penny to gain the customers because the rivals are trying to take up as much market has they can of lost customers. J.C. Penny is at a critical position right now; the question now remains whether they will be able to reverse the damage.

Do you think the J.C. Penny will gain its customers back and be able to create profit that they use to?

http://www.businessweek.com/articles/2013-04-11/j-dot-c-dot-penney-rehires-myron-ullman-to-clean-up-ron-johnsons-mess#p1

Can the all-electric car reach mass market appeal?

Posted on by spr1331tasafuadjaye

Who killed the electric car is a term you sometimes hear when referring to motor vehicles that run exclusively on electricity. With the environment issues being a big concern for our society today, many car manufacturing companies have developed hybrid vehicles. Hybrid Car being a vehicle that uses two different power sources to move the car, most commonly the internal combustion engine which uses gas fuel and an electric motor that uses.  The hybrid cars have gained popularity among consumers, especially the Toyota Prius, this has resulted in many car manufacturers developing hybrid vehicles to gain some market share.

However some come car manufacturers such as Honda, Nissan, Toyota, and Tesla to name a few have taken it a step further by producing purely electric vehicles that run only on electricity.  Electric cars are nothing new, being created in the late 1800’s and early 1900’s,  however gasoline fueled cars gained increased popularity and have captured the market ever since.

So what will it take for the Electric Car to reach mass market appeal? What do the managers at these huge car companies have to do. Many executives believe the electric car has to gain trust amongst car consumers. For now many consumers foresee a future with the hybrid car because of its driving range which drives a certain amount of miles on electric power then gasoline power takes over, which is fuel efficient.  Compared with the limited driving range of the electric vehicles.  There are a few factors which  limit electric cars from reaching mass market appeal. First the limited Driving Range of some of the electric vehicles and niche battery powered cohorts is a main factor  stopping consumers from buying into the technology. Another factor is the high initial price of many of the Electric Vehicles, many times being more costly than gasoline powered vehicles. One more huge factor is the unavailability of electric charging stations compared to gas stations. Going to a gas station is very convenient for consumers and that is what they are used to.

Nevertheless there is much advancement taking place with the electric vehicle technology and the availability of electric charging stations. John O’dell, and Edmund’s analyst predict the following would constitute an electric vehicle that could be mainstream: an electric car with a driving range of 150 miles that could be completely recharged in about 10 minutes or and electric car with a driving range  of 300 miles that could be completely recharged in 30 minutes. The price of these vehicles should be in the range $25,000 to $30,000, so it could somewhat affordable to middle-lower income comsumers. Also it was suggested that there be a good national network of electric vehicle charging stations so that it could be convenient to charge your car anywhere.

These are all great suggestions to making the electric car more appealing to the mass market and I definitely know I plan on getting one in the future, being a big environmental guy myself. However what would make you switch from Gasoline powered vehicle to purely Electric powered?

 

http://business.time.com/2013/01/29/what-would-make-an-all-electric-car-appeal-to-the-masses/

http://inventors.about.com/od/estartinventions/a/History-Of-Electric-Vehicles.htm

Green Innovations – Affecting How and Where We Travel?

Posted on by spr1311kbeery

“When you travel these days, you’re doing so in a more environmentally friendly fashion than you did a decade ago- and you probably can’t even tell.”

Today, many business industries are changing the way they operate their business by placing more emphasis on environmental sustainability. For example, hotels are using motion sensors, key cards that control lights, fluorescent bulbs and ceiling fans aimed at saving energy. They are installing low-flow shower heads and toilets, while also recycling more and replacing individual shampoo bottles with large dispensers. Although these things may seem small and almost unnoticeable, they truly make a huge difference. “Green buildings use, on average, 26% less energy, emit 33% less carbon dioxide, use 30% less water, and produce 50% to 75% less solid waste, according to the building council.”

Element Hotels- use eco-friendly materials as often as possible and are applying for LEED certification.

When looking at other industries such as the airline and rental car businesses, they too are making a larger effort to surpass the minimum legal requirements and become more sustainable. Since 2000, Airlines have saved more than $33 Billion on fuel and prevented the release of 670 Billion pounds of greenhouse gases.  The Airline industry has adopted new technology and practices to reduce their carbon footprints. For instance, US Airways are replacing gas-powered ground vehicles that transport bags with electronic ones at its Philadelphia hub and adding a new building to house the vehicles at Philadelphia Airport that is made of 20% recycled materials.

Moving on, another industry, the car rental industry is also taking many new steps in order to be more “green.” Today the enterprise has more than 5,000 hybrids and electric vehicles for rent in 70 different locations. Lisa Marini, a spokeswoman says that “we will continue to add hybrids and EV’s to our fleet based on consumer demand and availability from manufacturers.” Furthermore, David Eastes, a director at VroomVroomVroom.com who tracks the industry, says he has seen an increase in the number of companies dedicated solely to renting out hybrid and electronic vehicles and “that’s never been seen before.”

Moreover, business in these three industries are making the change to be more green not only because they have been forced on the industry by the threat of government action, sheer economics or consumer demands, but some companies say its just good business. Paul Snyder, Vice President of corporate responsibility for IGH proclaims that, “we actually have customers who are asking, ‘What’s the carbon footprint of our meeting.” With so many people today becoming more and more knowledgeable and concerned about sustainability, making every effort to go more green, no matter how small, and even if it goes unnoticed, is extremely important.

In sum, How do you judge companies based on their sustainability efforts? And how do these efforts change your opinion of the company’s reputation? What sustainability efforts have you experienced from hotel, airline, and rental car businesses?

Reference: http://www.hotelmanagement.net/green/green-innovations-are-changing-the-face-of-travel-20076

Social Networking after Death? Google, Twitter, and Facebook

Posted on by spr1322jkurzac

Social media became heavily popular in the early 2000’s when MySpace, Facebook, LinkedIn, and Friendster were launched. These sites allowed users to communicate in other ways besides email. Today, there are tons of different kinds of social networking websites. However, Facebook, Twitter, and Google remain of the most popular. These networking sites allow users to communicate in different ways. Google focuses more on email and/or chat, while Facebook and Twitter allow users to communicate with one another with “statuses” and “tweets,” respectively. These social media sites recently took it a step further and introduced ways of tweeting and messaging after death.  By allowing this to happen, are companies just really desperate to keep their social media outlets buzzing with posts from the dead?

Google introduced the Google Inactive Account Manager or what it has been called lately, “Google Death Manager.” Those that are heavily involved with social media accounts probably have wondered what happens to their account after they pass. Google has a plan for those that care what will happen to their Google services such as Gmail, Blogger, Google Drive, Google+, Google Voice, and so on. Basically, you have two choices. You can either either pass on your “digital life” to someone you trust, or you can simply set up a time of inactivity. You can choose from one, three, six, nine, or 12 months. If you happen to not login in the certain amount of time you chose, then Google will either contact/alert 10 of your trusted contacts (and share your data with them) or you can simply have it set up to delete your account.  Personally, I think this is not a bad idea at all. If someone disappears or dies suddenly, maybe there is information in their Google account that will help solve the case. I support privacy in every aspect all the way, but this can really help in a time of need.

Next, Facebook has introduced an app called “Ifidie” that allows users to send messages to your friends after your death. I believe the  If I die app  is a bit too much. The Facebook administraters post a public Facebook message or send out private message to specific people. The admin are allowed to do this once at least three of the trusted friends you choose report your death to the Facebook service. I understand we are in the digital era, however, I believe this is just too much. Again, is this to keep the buzz going?

Twitter has also introduced social media after death with _LivesOn. This is a tool that monitors your Twitter habits and patterns then after your death, it will continue Tweet for you.

Perhaps social networking after death is for those who are more comfortable with death. Personally, I think these companies are trying to get the buzz however they can. Would you like to be active on social media even after your death?

 

 

http://www.cnn.com/2013/02/22/tech/social-media/death-and-social-media

http://www.forbes.com/sites/kashmirhill/2013/04/11/google-death-manager-new-feature-to-tell-the-company-what-to-do-with-your-data-when-you-die/

http://abcnews.go.com/Technology/google-inactive-account-manager-decide-account-die/story?id=18933370

 

Where Products Go To Die

Posted on by f1224ltaylor

In a country where 90% of our consumer products become waste in about 6 months, sustainability is becoming a more pressing issue for companies operations.  A great example of a company that implements sustainable operations is Method a company that makes house-hold cleaning supplies, most popularly carried by Target. Method attempts to implement sustainability in their products, their process and their company itself. Their most important achievement in operations sustainability is being Cradle to Cradle certified.

Cradle to Cradle is the concept that a company can re-design products and change their manufacturing process in order to maximize positive impacts environmentally, economically and socially, where a company is less dependent on raw materials and energy and the supply chain is naturally more eco-efficient.  Most manufacturing processes are linear and considered Cradle to Grave, which is when a company uses raw materials to create a product, the consumer purchases the products and then eventually puts it in the trash where it is taken to a landfill or incineration. Cradle to Cradle attempts to create a cycle where a company pools materials to be re-used and products are returned from consumers and recycled back into products.

Method displays on their website their Cradle to Cradle certification and explains how they are certified in product design, product manufacturing and social responsibility. Method’s product design is evaluated by their ingredients which are comprehensively assessed for safety and environmental health and their packaging design and materials are evaluated for safety, effects on the environment and recyclability.  Method’s manufacturing processes are evaluated regarding their use of water and energy and their material recovery. Method’s social responsibility is evaluated through governance, ethics and transparency.

These are many ways companies can be more sustainable and the Cradle to Cradle certification is a great way to remain consistently sustainable. It also helps prove to consumers that your company is actually sustainable, rather than using the “going green” trend as a marketing ploy, which many companies have done.

Although Cradle to Cradle may be ideal for sustainable operations, it can also be very expensive, from redesigning products to tracking manufacturing in more granular ways. It almost attempts to challenge and change business models and the way products are produced. The only way to fight these challenges and expenses is to incorporate these practices from the beginning into the first business model. Which is why we should always challenge flaws in current business models and ask ourselves how we can create evolutionary business models.

A Storm’s A Brewin

Posted on by f1231ivboneva

storm

With hurricane Sandy quickly approaching the East coast, it is hard not to wonder why these storms are coming in stronger and later than ever. The Chicago Tribune published an article today examining the factors contributing to these “super storms” and all facts point to global warming.

Amanda Staudt, a climate scientist for the National Wildlife Federation, explains that climate change is not the sole cause of catastrophic weather events, but instead intensifies their damage and severity. She believes that since the Earth has become increasingly warmer, the length of hurricane season has increased, and the numbers support her conclusions. As industrial societies began burning fossil fuels “in great quantities in the late 19th century… the average global temperature has risen between 1.5 and 2 degrees Fahrenheit.” In addition, the water temperate in the Mid-Atlantic is 5 degrees higher than the average. Because of these warmer climates, out atmosphere retains 4% more moisture than it once did 40 years ago. Scientist predicts that by the end of the 21st century “hurricanes could dump 20% more rain than it does now.”

This article relates directly to the ethical and social responsibilities companies have in an effort to preserve the environment. Along with providing ethical working conditions and accurate financial statements, companies should use environmentally friendly resources and dispose of their products in a safe way. It is the manager’s duty to ensure their business is not harming people or the environment in any way.

Alternatively, city officials of New York, New Jersey, and other large cities on the East coast are taking every precautionary measure to ensure people stay safe during hurricane Sandy. Officials have closed down the entire subway system in New York, hired additional electricians from all around the US, and canceled hundreds of flights and trains to and from LaGuardia.

I find this forecasting to be a great sign of successful management by the city officials, but what do you think? Do you feel that they are over-hyping this storm, like many believe happened last year with hurricane Irene? Will the increase of this ‘Super Storms’ encourage companies to become greener?

http://www.chicagotribune.com/news/nationworld/la-na-nn-hurricane-sandy-heads-to-northeast-20121027,0,177959.story

SOS: Hewlett-Packard’s Sinking Ship

Posted on by f1211rbradow

On the Businessweek website, there is a blog post explaining the downward spiral of Hewlett-Packard. The blog begins by explaining that the company’s CEO, who happens to be the fourth in the past seven years, announced that shares recently dropped to a nine–year low and that the company’s 2013 profits are more than likely to miss the estimates previously made. The company has been in a state of decline for the past twelve. The company will make facility consolidations and large layoffs worldwide.

The author of the blog, Judith Hurwitz, predicts that Hewlett-Packard will have no choice but to become a holding company or break up into pieces and sell. Ideally the company would turn around by creating new innovative products since the company was built on the idea innovation when it first began and it succeeded quite well for a time in the market of technology. A turnaround through the creation of new products would help them attempt to keep up with such companies as Apple, although those chances appear slim to none at this point especially since the company is in the red to the amount of 30 billion dollars. With that amount of debt, options become limited. Any manufacturing company faces large costs involved with creating new products from design to production and testing, similar to our Deming cycle or PDSA. Hewlett-Packard would have to create products that can compete with or surpass those already on the market and then improve upon them as time passes. With Apple creating new products or improved models regularly and a loyal customer base, I do not think Hewlett-Packard stands much of a chance at a turnaround especially since they only specialize in hardware in the form of computers and printers.

Early on in the company’s life they proved to be a contender in the computer market, I myself have had several of their products over the years. However, as we have seen with many well-known and well-off companies, the ship is starting to sink. I believe many factors have gone into their current downfall such as a fast paced market that is constantly changing, changing consumer demands, and the success of Apple. This only makes me wonder if Apple will one day face the same fate. I am sure Hewlett-Packard, or any other company for that matter, never thought they would be in such a position. Had they branched out in the form of products such as phones or software, perhaps they would be better off today; or maybe such things will be what saves them. Perhaps they have attempted to make incremental improvements to both their products and business strategies over the years that have not proved to be greatly beneficial in the long run; maybe what they really need is a breakthrough.

Do you think Hewlett-Packard will be in business much longer? What are some ways they can stay in business?

http://www.businessweek.com/articles/2012-10-01/can-hewlett-packard-be-saved#p1

Luxurious and Green: The Fisker Karma

Posted on by Sabeen Sadiq

What’s better than a green, eco friendly Prius? Well, the Fisker Karma of course. Fisker Automotive is an independent start up by partners Henrik Fisker and Bernhard Koehler. Being in business since 2007, Fisker Automotive is a fairly new brand. The new hybrid is only one of many sports hybrid cars currently on the market that are in fact, greener than ever. How can the Fisker Karma possibly be so green? It has silent electronic door latches and a solar-panel roof. This helps run the AC fans and fill the battery. It is considered an Eco Chic car and it consists of natural-fabric seats. It includes wood trim recovered from California forest fire and the dashboard is ultra suede, which means no leather is used.

“This car is more sexy and exciting than any other car you’ve seen,” boasts designer Henrik Fisker.

Basically, the Fisker Karma is the first luxury plug-in hybrid. It has two modes. Stealth mode is battery mode, and sport mode gives the car 402 horsepower. When driving the car, it can go up to 50 miles on battery power, then the system is jolted by electricity from the 2-liter, 4 cylinder turbo gas engine. This luxury car is competing with the Porsche Panemera and the Tesla Roadster. These are all eco friendly luxury sports cars. What differentiates these cars is price, physical features, and brand equity. Fisker Karma beats its competitors when it comes to being ecofriendly, and no other luxury hybrid can be plugged in to charge. The Fisker Karma is $103,000 and is near in price to its competitors. The Panemera is $95,000 and the Tesla is $109,000.

 

Will the Fisker Karma be successful globally? (They have built the car to have low emissions, to cater to European countries.)

Will people want to invest in such a new unheard of American company or will they stick to trusted brands like Porsche and Lexus?

 

Sources:

http://jalopnik.com/fisker-karma/

http://articles.chicagotribune.com/2011-12-08/classified/sc-cons-1201-autoreview-fisker-20111208_1_batteries-fisker-karma-green-machine

http://library.depaul.edu/CheckURL.aspx?address=http://search.ebscohost.com/login.aspx?direct=true&db=a9h&AN=50448860&site=ehost-live&scope=site

 

Concerning Environmental Sensitivity: Where Does Responsibility Fall?

Posted on by f1224mtorelli
Bill Hoffman – owner of Aptos Jewelers
Click the above image to be taken to the New York Times article associated with this post.

As students in an operational management class, we study all issues involved with operating a business.  We are taught that operating in an ethical manner is paramount and all-encompassing.  That an organization’s leaders must be cognizant of the impact their decisions have internally and externally – specifically in regard to the environment.  The article used for this post describes what happens when the government forces businesses to function in a certain way.  I found this article intriguing and in reading it, I found myself extremely conflicted.  Below is a brief synopsis.

_________________________________

More than two-dozen cities in California have enacted a ban on the use of plastic shopping bags and have begun charging between 5 to 10 cents to use a paper bag.  The movement has created a divide between shop owners like Bill Hoffman – owner of Aptos Jewelers in Aptos, California – and their counties.   Hoffman, who has been one of the more vocal opponents of the regulation, feels that charging his customers (who are often spending thousands in his store) for paper bags is crass.  Hoffman also is of the belief that the way he packages his product is part of the experience he offers.  He is offering a high-end product that requires high-end packaging.  After filing with Santa Cruz County for an exemption from the ordinance, Hoffman was turned down.

The push toward reusable bags has also upset the plastics industry, which is pursuing legal action against counties in California that have enacted a plastic bag ban.  Industry representatives claim that there is insufficient evidence to support that banning plastic bags will have any drastic impact on the environment.

Stephen Joseph, who is the primary voice and attorney for the Save the Plastic Bag Coalition, has argued that bans in cities that have a high tourist presence (such as San Francisco – which is initiating a plastic bag ban this month) will be particularly ineffective because tourists typically don’t travel with reusable shopping bags.  This has led Joseph to deduce that tourists will begin buying reusable plastic bags when they arrive in a location, and will dispose of them upon their departure.  This, of course, would make a huge dent in the purpose of the ban.

When questioned, many consumers voiced a frustration with the ban/paper bag charge, but expressed that it’s ultimately necessary.*

Questions to consider:

  • How do you feel about a movement of this type?
  • Should the government step in and ban materials that are harmful to the environment?
  • Should it be up to the business owner to ensure he/she is operating his/her business in an environmentally responsible manner?
  • Should consumers take the responsibility?

 

* The information provided in this post was drawn from the following New York Times article: http://www.nytimes.com/2012/09/29/business/energy-environment/communities-curb-use-of-paper-and-plastic-shopping-bags.html?pagewanted=all