The Ebola Virus Strikes Fear

The article, “Hazmat suit maker’s stock up 50% on Ebola fears” by Paul R. La Monica describes the effect of the Ebola virus on the demand for medication. The article states that with the cases of the ebola virus around the world fear of contracting the virus has increased dramatically, and so has the demand for preventative medications. The high demand, however, for these medications is much greater than companies are currently able to produce. In short, the companies producing the medication lack the capacity to produce the amount of medication demanded.

 

In short, the widespread fear of the Ebola virus has caused such a great demand for preventative medication that companies are unable to meet the high demand. What can companies do to meet the demand?

 

 

 

Social Responsiblity in the Workplace

Though it is not one of the characteristics that most people associate with being a manager, being Socially Responsible is key when leading a group. Being “Socially Responsible,” as described by DePaul’s Student Leadership Institute, includes taking seriously the perspectives of others, and self- understanding. Being Socially Responsible means conducting business, but taking into consideration those whom the actions affect. In today’s world it is accted for companies to ship labor overseas where it is cheaper, but does that necessarily make it right? It is important for leaders to take into consideration social responsibility because it they can set the example for companies around them. More importantly, being socially responsible could mean that there is less injustice in business.

This begs the question, “Are we just in the business for the money or do we care about those who we affect?”

Happy Competitors

 

On June 27 BlackBerry will launch its BBM messaging application for both iOS and Android smartphone platform users for free. BBM has been of one the key features in all BlackBerry smartphones.  According to blackBerry there are currently more than 60 million monthly active users of BBM, who send and receive more than 10 billion messages each day. This equivalents nearly twice as many messages per user per day as compared to other mobile messaging apps.

Few years ago BBM was the most active messaging application in the market and the reason for many people not to switch to an iPhone or Android cellphones. It was also very secure, reliable and was also equipped with voice, video calling and screen sharing and was on its way to become into a new type of social network. Even to this date there is nothing else that comes close to such service.  This gave Black Berry the edge over all the smartphones in the market and had established a very loyal fan following.

But soon blackBerry will make BBM available on both IOS and Android devices and this might just take away its edge.  As BBM was the main platform for people to interact on their BlackBerry smart-phones, this new service will give its consumers the ability to use this application onto any one of those devices of their choosing and I think this will create a big problem for BlackBerry in the near future.

I think BlackBerry should have hold on making this move and should have seen how their new smartphones will perform and on based on that they should have made the decision of what to do with their BBM application on whether or not they should put in the hands of their rival smartphone companies like Apple and Google.  To me it also seems weird that they would launch this application on other IOS and android devices before launching it on to their BlackBerry PlayBook.  Does this mean that they have completely given up on their tablet market? If so what kind of message would this send to their consumers and investors?

Another thing that BlackBerry has done is that they will be providing the BBM application for free to its both IOS and android users. I don’t think this was a smart move from a management standpoint. If you know that so many people are using your application and that it is one of the best one out in the market then they should have charged some sort of a purchase fee for the application knowing that people will pay for it no matter what. This would have given some sort of extra side revenue that they could have applied to their operations.

I also believe that if they would have acted on this sooner when the demand for application was even greater couple years earlier then what it is today, it might have still worked out to their benefit.

Do you think that this move will prove profitable for BlackBerry or will it backfire? Also should they have acted earlier on this when other applications like What’s App, iMessage were not as popular?

Sources:

http://n4bb.com/multiplatform-bbm-blackberrys-play-biggest-social-network/

http://www.yolevski.com/blackberry-bbm-for-iphone-and-android/

http://bgr.com/2013/06/05/blackberry-bbm-android-iphone-preloaded/

Tesla: Creating a revolution in the luxury car industry

If you are somewhat familiar even a little bit about stocks and have an interest in investing, you probably have heard about the recent boom of Tesla Motors (NASDAQ: TSLA) stock. Recently, the stock went as high as $110 a share; this was a 103% increase over a one month period and a 247% increase over a 3 month period.Source: AutoBlog

So you may be thinking, what caused this sudden increase and growth? Tesla stock first jumped 31% on May 8th when it announced its First Quarter sales to be $562 Million and recorded  first quarterly profit in its 10-year history of $15 million.  In a letter to shareholders, CEO Elon Musk mentioned that Tesla delivered 4,900 electric vehicles as well as other important figures. One of them being that their gross margin doubled from 2012 to 17 percent. This was made possible due to better use of raw materials, smarter inventory management, and a reduction in the hours required to build each car by 40 percent over the quarter.

In the first quarter of the year, Tesla delivered more than 4,750 Model S vehicles in the US which when compared to the more traditional luxury car brands such as BMW 7-series and Mercedes S Class, is much higher. BMW sold 2,338 7-Series models in the first quarter while Mercedes sold 3,077 S-Class models. The demand for their most popular model, Model S, is projected to be around 20,000 units per year in North America and in Europe, the current order rate is 200 per week. In order to meet these demands, they have added some changes to their manufacturing process which should drive margins higher.

Some of these changes include:

(1) a reduction in temp workers since the beginning of the      year

(2) increased efficiencies and reduced scrappage both at supplier and in-house production sites

(3) a streamlining of operations leading to a further reduction in full time employee man-hours from 60-70hrs/week previously to 40-50 hrs/week currently

(4) a significant improvement in logistics costs.

 

Currently their body assembly and finished assembly are still running on a 2 shift basis so the main goal of the production team right now is to get production levels of 20,000 on a single shift across most processes.

With the Tesla Model S being a luxury car and priced at $62,400, I feel that its affordable and much better then other cars. Do you see Tesla continuing to be as successful as they are now and do you think their stock price will continue to go up as it is now? As I mentioned earlier, they out sold Mercedes and BMW luxury models, do you think that will continue to happen in the future as well? What would you rather have, Tesla or other traditional luxury car models?

 

 

http://venturebeat.com/2013/05/08/tesla-stock-jumps-almost-20-after-record-562m-in-sales-and-first-ever-quarterly-profit/

http://www.valuewalk.com/2013/04/tesla-motors-inc-tsla-model-s-sells-more-than-mercedes-and-bmw/

http://www.valuewalk.com/2013/05/tesla-motors-inc-tsla-envisions-selling-around-500k-units-long-term/

Changing the Gaming Landscape

 

Recently Microsoft announced their newest version of its Xbox series, the Xbox One. The Xbox has been one of the most profitable products for the Microsoft in the last decade and with Xbox One Microsoft hopes to continue that tradition. When Xbox 360 was last released around eight years ago there were no iPads; we still had smart phones with keyboards and the smart phone app stores were still in there initial phase. But a lot has changed in the last eight years; today games can be played from virtually anywhere and on any device with everyone online.

Because of the rise in the mobile gaming and its low prices, gaming systems like Xbox, Play-Stations, Nintendo has started seeing decline in their sales.  According to a report released by a leading technology research firm IDC, they concluded that paying for games on smart-phones and tablets would outpace paid gaming on portable video game hand-held devices by the end of the year. According to Nick Wingfield’s article in the New York Times U.S retail sales of game hardware and software fell by 25 percent to $495.2 million in April from $657.3 million earlier last year. This means that more and more people prefer mobile gaming rather then the old traditional gaming methods. This also proves that the life cycle for these gaming consoles will be cut short drastically unless they innovate their products for more use then just gaming.

So to keep up in the race, companies like Microsoft has started innovating their gaming consoles into more useful ways. Microsoft noted saying that they want to see their Xbox product as a more useful tool in peoples living room then just for gaming purposes. So to achieve this they want the Microsoft’s technology to take the center stage of a home entertainment system, which would end up giving people access to online videos. Apart from that Microsoft is also planning to develop its own original live-action television series that would be accessible through the Xbox. To stay ahead of the competition and to stay in the market they are also working with National Football League to develop an app for Xbox that would let players interact with their fantasy football teams while watching the live game.

From all this innovation that Microsoft is bringing in to the new Xbox, it is clearly evident that they are trying to do more with their consoles then just using them for gaming purposes.

Surely technology has come way forward then it was then Microsoft’s earlier product was launched eight years ago but do you think that will this affect the products life cycle? Will the mobile industry have drastic effect to gaming hardware systems like the Xbox, Nintendo, or PlayStation? Will innovation in their product similarly to what Microsoft has done will help them stay survive for a long time as it previous products?

Sources:

http://www.nytimes.com/2013/05/22/technology/xbox-one-faces-wider-range-of-competition.html?_r=0

http://bits.blogs.nytimes.com/2013/04/24/paid-games-on-smartphones-to-outpace-handheld-consoles/

Picture:

Microsoft’s Xbox One gaming console.

(Credit: James Martin/CNET)

 

Online teaching is the Future!

In today’s market, paying for school can be an issue for any student who does not come from a wealthy family. Thanks to rising tuition and a tough job market, college seniors graduated with an average of nearly $27,000 in student loan debt last year. That’s not considering and putting in the factors of them even having a job after graduating. Increase comes at a time when unemployment is remained stubbornly high for college graduates. In the same time even public colleges have increased their rates due to State budget cuts.  A recent study showed that nearly 90% of the seniors graduate with a debt. So, how do we solve this problem?

9376966-graduates-celebrating-their-success

Georgia Tech University has an answer for this. There has been a big shortage in the computer-science field all over the United States. On May 14 the Atlanta University introduced the first ever online Masters degree program for recent graduates or even professor in University. This is remarkable because is has never been done before. With nearly a fraction of the cost one can obtain a degree that is very hard to obtain with all the debts a student has acquired over the years. These online courses are being referred to as MOOCs. For  nearly $7000 today, one can get a Masters degree. The program does have some controversies amongst other colleges and professors. Some believe that it is not a traditional way to obtain a degree or is a threat towards teachers, but is that really our problem, when options are left so limited?

OB-XR547_kessle_D_20130602172816

I believe that this is the future for schooling if you believe it or not. Yes in the beginning like anything we people will hesitate to use a program for online learning but in the end its not only limited to college, but also high school. ” In 2011 only 7.9 Percent of 11th graders were tested college ready” Thats failure, and worst when you realize how much money was spent in teaching them. We live in a tech savvy world where kids grow up playing call of duty, and online communication. How can they possibly do worst then 7.9% with the online education system?

What do you guys believe the future to be, keeping in mind the rising cost of tuition and debt rate? Should be implemented to see if there is a change and progress?  Or keep the old ways ?

http://online.wsj.com/article/SB10001424127887324659404578504761168566272.html?mod=trending_now_3

 

Ice Cold Beer Here! (in the U.S)

 

20-jp-BEER-tmagArticleHave you ever wondered, just how much it costs to import the “better quality” beer from around the world like Corona, Modelo or Heineken or where exactly does the beer I drink come from? Most likely you drink a product either made by or distributed by Anheuser-Busch and InBev (ABI) considering they currently have aver 39% of the market share for the American Beer Industry. But just recently ABI has taken actions that will give them a majority of the market share for the American Beer Industry, which includes a 20 billion dollar acquisition of the Groupo Modelo Beer Manufacturing Company of Mexico.  This includes expanding the company internationally to Sounth America and adding the brand names of Modelo, Dos Equis and Corona.  This merger was so large that the Department of Justice filed a lawsuit against the company in fear of them reaching a stage of monopoly and market leader.  The result of this was for ABI to sell a 50% share of Modelo’s share to the Constellation Corporation, who currently owns about 20% market share of the American Beer Market, for only $5.5 billion.  DOJ says that this will allow for less consolidation and more competition in price in the markets.

Rob Sands, president of the Constellation Corp. says that this is the most transformational deal in the company’s 86-year history. The results of this merger range in variety and benefit both ABI and Constellation.  ABI will now have 46% market share after the acquisition as well as gaining all rights over the Brand Corona and its factories in Mexico.  Granted that they Corona accounts for over 20% of beer sales in some regions ABI distributes to, they will being seeing substantial growth in capital output and profits in the coming years.  Constellation also stands to see a similar amount of growth in the coming years.  They have aquired the brand of Modelo. Constellation makes wines from Robert Mondavi and Clos du Bois, as well as Svedka Vodka. Although they have never brewed beer before Constellation is excited about this endeavor. They will build a new state of the art facility for brewing the Modelo brand on the Texas-Mexico border. This will result in the plants capacity doubling in a matter of a few months. How do you think that these actions will affect other beer manufactures output such as Miller Coor’s? Also how do you think that this acquisition will affect beer prices of domestic, imported and micro brew beer companies?

http://dealbook.nytimes.com/2013/04/19/anheuser-busch-reaches-deal-with-antitrust-regulators/

What’s leadership management?

When it comes to management strategies, we are firm on our beliefs and behavior towards the approach we take in managing a staff. We attend classes and read books on the appropriate methods of managing a team, but what if I told you that everything you know about management leadership has been wrong all along.

When you attend a leadership class, you discuss the tools and techniques you can use to alleviate the situations, but the real issue is never address. The major issue is people. When entering the work environment you are forced to work with many different personalities. With all the different personalities, you are bound to clash with someone. In perfect world, we would all agree and get along but unfortunately, this is not the case.  If the issues you have with people are never address, conflicts arise and create big problems. When attending leadership training this issue is often over looked by trainers.

badboss_1881n46-1881n74

In leadership classes, it is clearly defined that leaders have a fundamentally different task from the people they are overseeing. With the title of a leader, you are given an extra power that is linked directly back to fear from your staff.  This is the issue in leadership and corporate leadership.  If fear can be removed from the equation, staff will be more willing to communicate issues and ideas they have. Instead of looking at someone as a threat, you can be viewed as someone that was placed in the position you are in because you have put your time into the company and you are very knowledgeable. What if this was the message that employees received instead of the thought that the person who hired you has absolute power over you. It is no secret that real leaders use influence rather than the use of power to achieve goals, yet corporate America continues to run organizations as if this is unheard of. We have all these large corporate leaders attend these leadership training courses but the common worker is never invited. Why is that? Is it that magical secretes are exchanged and only the elite can understand them?

This style of management is not the way to go. We live in a world now that is so diverse that we can benefit from the exposure of different people, cultures, and ideas. Technology and global markets have given us the window of opportunity to take advantage of this and learn from each other. It is clear that the best people will not follow this style of management, they will not submit to the fear of the manager.  We need to start listening to all the issues and address them from the bottom and go from there. We need to consider everyone and see each other as equals and work together as a team with a common goal. We need to eliminate fear.

http://www.businessweek.com/articles/2013-04-12/everything-you-know-about-leadership-is-wrong

http://au.pfinance.yahoo.com/money-manager/career/article/-/15165315/15-ways-to-spot-a-bad-leader/

Got Spirit?: Sales at an All-Time High, Quality at an All-Time Low

As summer approaches, most of us are hoping for a summer getaway. Perhaps one of the most stressful aspects of travel is getting to your destination, and with airfare only increasing, cost is often a key factor in making travel decisions. For a penny-pinching traveler, Spirit Airlines is a frequent air carrier of choice, due to its prices that are considerably lower than its competitors. Spirit’s average base fare is around $79, as opposed to a competitor’s base fare, which would be well over $100.

So how is Spirit able to offer fares at such low prices? An important thing to bear in mind when considering Spirit Airlines is that their business model is drastically different than that of Delta, American Airlines, or Southwest Airlines. While those airlines are quality and customer-satisfaction driven, Spirit is driven strictly only by low prices. They have the ability to offer fares at such low prices since they cut out a lot of expenses that other airlines take on in order to offer their passengers a more comfortable and ritzy experience, such as in-flight movies, free refreshments, and ample amounts of space. On a Spirit flight, they have none of the mentioned extras, as well as a more compactly designed plane that is plastered with ads and leaves its customers cramped and crowded. Spirit flights serve one function, getting you from one place to another as cheaply as possible. Spirit has acknowledged the poor quality of their flight experiences, and after over 16,000 customer reviews their flights are rated the poorest quality in the country. However, this does not phase them in the slightest. Spokeswoman, Misty Pinson stated that to the typical Spirit customer, quality is not that huge of an issue, since price is the biggest priority for them. With that in mind, it is clear that Spirit goes after a very specific type of traveler, one who is incredibly price conscious and is willing to sacrifice comfort in order to travel as cheaply as possible. This business model has been working for Spirit. Over the past few years, sales have been steady, and have even increased by 23% in the past quarter. They have also seen an increase in the number of passengers per flight, averaging about an 85% occupancy in 2013 so far.

Though Spirit has been quite blase about their poor reviews, they still express some interest in breaking down the poor public misconceptions about their airline created through bad press. They make it very explicit that it is unhelpful to be grouped with airlines such as American Airlines or Delta, since their business model is completely different and they have a very different focus in terms of their target market.

Do you think Spirit Airline’s business model of sacrificing quality for price is a sustainable one? As a traveler, would you choose Spirit strictly based on price?

http://www.businessweek.com/articles/2013-05-23/spirit-airlines-doesnt-care-if-you-hate-it

Find a Beauty Expert at Your Local Target!

Generic beauty-products2Target is one of our go-to stores when we are in need of practically anything you can think of-a hair brush, a summer dress, groceries, a plasma tv, makeup, face cleansers and much more. Recently, an article in the Chicago Tribune reported that Target would soon be expanding its “beauty concierge” within the Chicago area. The company’s goal is to expand this program from 28 to 44 stores. The uniqueness of this program is that associates are dressed in black aprons equipped with iPads, as well as mirrors and product samples to provide shoppers with guidance and expertise when they are browsing through the aisles of the beauty section looking for beauty products. According to this article, Chicago was selected as the test market for this program due to its shopping population. Specific locations Target is hoping to expand this program include Cicero, Vernon Hills and West Schaumburg while shutting the program in other locations such as Palatine, Bedford Park, Joliet, Villa Park, Oswego, Plainfield, North Aurora and Romeoville. Further, Target is also expected to expand its program into three additional markets: Los Angeles/Orange County, Minneapolis and Washington, D.C

The implementation of Target’s Beauty Concierge program is part of a trend in the beauty industry in which department stores and specialty retailers are helping and giving customers the opportunity to try their products before buying them. Since the skin care market grew 10 percent in 2012, Target is anticipating this program to boost sales. This new personalized beauty service is allowing Target not only to compete with stores such as Walgreens, who offers most of these products, but also to beauty retailers such as Sephora and Ulta Beauty. Hana Ben-Shabat, a partner at a global management consulting group commented on Target’s strategy by saying that at the end of the day fashion is a product and department stores are competing with beauty retailers and vice versa.

Operation managers at Target are certainly trying to keep up with the industry by coming up with these unique strategies. I think that the implementation of this new service can be a great success in very populated Target stores across the city, for example in downtown Chicago.  As this program matures, I think Target will gain a competitive advantage over other popular department stores such as Wal-Mart, Walgreens and CVS. The success of this program will largely be dependent on the type of associates that are being hired and the level of training they receive. Customers nowadays are always looking for advice when they are shopping for products, especially make up because not everyone is a beauty expert. Having someone to help you choose which specific foundation matches your skin, which mascara would help your lashes stand out, or which lipstick would look nice with an outfit, is certainly a service customers will appreciate. In my perspective, operation managers should place great emphasis on the increase of sales from beauty products to ensure that this project is being managed efficiently and can perhaps be used as a basis to provide a reasonable forecast to other Target stores across the nation.

What is your opinion? Do you think this program would attract more customers?

http://www.chicagotribune.com/business/breaking/chi-target-beauty-concierge-program-20130524,0,7813736.story