Case Study

Question 1

Lavenders Café managed to establish a strong market position in the US by creating a $ 10 billion business model. The company is currently earning billions of dollars from the two jurisdictions. The café uses the differentiation strategy to distinguish its products from those of competitors. This has made it win the trust of the customers in the market. Some of the product that this restaurant offers comprise of salads, sandwiches and nutritious soup.

There are several adjustments I will make to ensure that Chinese stores increase their profitability through branding. One of the ways is to develop a unique with a powerful message to the audience. It may persuade customers to purchase and remain loyal to the corporation’s products. As a result, the productivity of these stores may increase significantly in the future (Drenzer, 2019). Additionally, the clients should attach some level of prestige to its brand. This can make the customers think that the firm’s products are better than those of the competitors. It means that they will be willing to pay more for such merchandise.

Moreover, this can influence the entity to increase the value of their products. The trend will be caused by the increasing demand for the company’s items and the reputation that the brand enjoys. Therefore, it is evident that a real brand can make many individuals to associate themselves to the business. Thus, it has the potential of increasing the profit margin per customer. Finally, it allows the firm to charge more for its products even if the rivals sell them at lower prices.

The company’s brand also has the potential of increasing Chinese store sales significantly. Most of the consumers will gravitate towards products that have a higher reputation in the market. It is because the message will quickly spread among the clients about the existence of the product in the market. Besides, the stores will significantly increase their sales because of the referrals that they will get from their loyal customers ( Greener 2012, pg 181). This is because many customers purchase the entity’s products because of peer group influence. As a result, they will be willing to buy the corporation’s items which have a good name before the eyes of the public.

Chinese stores can use this brand to retain their esteemed customers. Brand equity has the potential of maintaining clients thus, increasing the profitability of the company. An excellent brand will make the clients to associate themselves with the enterprise. They will always anticipate purchasing the company’s foodstuffs from the stores even if they cannot afford them at the moment (Hoch 2013, pg 114). Retaining the clients will increase the profits of the company and reduce the resources that the business will use in advertising its merchandise. It will ensure that the corporation achieves the same sales volume without necessarily promoting its merchandise. Finally, the enterprise can incur less cost to retain the existing client than attracting a new one.

When performed in the right manner branding can assist in strengthening associations with the clients. Secondly, it can motivate the workers and transform the company’s culture. Additionally, it will help in winning new clients which will significantly assist in improving the profits of the corporation. Branding is one of the best approaches that the business can use to earn huge returns ( Jacobsen 2013, pg 416). Without good brand images, the chances of the Chinese stores succeeding will be minimal. In this case, the company should always strive to enhance better communication with their customers. One of the ways is by asking clients what they would like to see in the brand. This can persuade the customers to purchase goods from the corporation thus, increasing the company’s revenues.

Question b

Standardization is an approach that the business uses to achieve the same level of uniformity in the service or product between outlets. It means that all the channels should enjoy mutual gains by using the same tested approaches. This has the potential of decreasing to lower the costs of the business and also helps it to enjoy the economies of scale (Keene 2017, pg. 356). This is possible where all outlets pull resources together to attain specific objectives. Uniformity of operations will make it easier to trace the activities of the business. For instance, the use of the same accounting approaches will make it easier to understand the financial position of all the branches. Additionally, it can assist in decreasing confusion in the business.

However, standardization has several disadvantages for the company. First, it leads to a lack of adaptation since businesses operate in different markets that are different and dynamic. Secondly, it can result in lack of uniqueness. Thus, diverse regions and outlets offer exceptional opportunities which may be beneficial to the firm (Kieley 2005,150). Though, uniformity can hinder the enterprises from utilizing these opportunities because they are supposed to comply with the rules. Lastly, standardization may not be appropriate for some businesses like advertising which should adjust to the demands of the clients. Therefore, companies should be allowed to chose whether they should standardise their operations or not.

Question 2

Luis Chen is the right person for the job since he is a go-getter. This means that he is a successful individual who is ready to deal with difficult situations in corporations. Chen is also prepared to share ideas and knowledge with other members of the entity. As a result, it will provide a perfect opportunity for him to mentor other young leaders. It is possible by training them on how to perform various tasks that they never knew before. Since Chen is a go-getter, he is likely to emphasize the unity of purpose and morality. In the long run, people will work as a team and attain better results in the future. Luis attitude demonstrates that he is loyal to the enterprise since he is willing to interact with individuals. It gives him a chance to share knowledge on how to improve the business. Therefore, staff members will be free to share their challenges with him and come up with measures on how to eliminate these problems. Luis is also a good leader since he can show empathy to the individuals he is leading. He is ready to listen to their grievances and address them in advance.

Additionally, Chen can use his housekeeping skills to ensure that individuals work without any conflicts. As a result, the measure can significantly assist in increasing the productivity of the staff members ( Pitts 2017, pg 282). Furthermore, he can act as a role model for the people he leads. This can be achieved by showing them a good example of various issues. In this case, I can recommend the management to give him this chance. Chen can assist the organization to grow to greater heights in the future.

Question 2b

There are conflicts between the US and China because of cultural differences. Thus, there is a need for Mia foster to develop a multinational team to deal with the issue. One of the approaches of selecting this team is by choosing the equal number of people from both countries into the team. Also, individuals of high integrity should be given a chance to join the team. In this case, they should not be biased and should avoid favoring any different group. It can assist in decreasing conflicts among the group members. It is also prudent to choose the multinational representatives through a consensus. This is one of the best ways of selecting these individuals since the two parties in a dispute agree on the people that should present them. The measure will ensure that all the team members are acceptable by both nations. The individuals joining the group should also be vetted to ensure that they understand both cultures. Comprehending both traditions is necessary as it will assist in knowing why the two cultures conflict. As a result, they can come up with amicable solutions on how to deal with the challenge.

Moreover, those joining the multinational team should be highly experienced in the field of conflict resolution. They must have helped in solving problems involving two or more nations in the past. Therefore, they can use such skills to address some of these problems among countries. Finally, multinational team members should be people who are tolerant of diverse cultures. The measure can significantly assist in ensuring that they make decisions that are favorable to the two opposite groups. Thus, the cultural differences between the Americans and Chinese may come to an end. Therefore, individuals should respect other people’s traditions even if they do not agree with them.

Question 2c

Managers should use an approach that will allow them to function internationally. They require some skills and knowledge in management. Secondly, they are required to know how to deal with subsidiaries. Moreover, global administrators should have experience in project management and how to manage their international teams. As a result, they can be able to attain better results in the future (Silber 2008, pg 2140).

Moreover, they should have the desire to attain more significant results and show open-mindedness for learning. Additionally, the managers should have knowledge transfer. This can be achieved through job rotation. Thus, multinational corporations contain 80% of the rotating members from different subsidiaries. They can work for a maximum of two years to facilitate knowledge transfer. Group leaders can impart the knowledge obtained to their local subsidiaries after returning home.

Additionally, an international administrator should have an understanding of all cultures. It is one of the competencies that global administrators should have while executing their tasks. Furthermore, managers should have excellent communication skills and collaborative approaches with individuals from diverse cultures. These skills can enable them to unite individuals from different backgrounds. This is because managers are expected to work and interact with individuals from different nations. The administrator must engage everyone without any discrimination.

Additionally, an international manager should also be tolerant of other people’s cultures. Leaders who do not respect other people’s perceptions can create divisions among the members of the public. They should also learn why people behave differently from others. These qualities can help a leader to solve any challenges that individuals have in a better way.

Question 3

The headquarters play an essential role in managing the operations of the subsidiaries. First, the head office oversees the activities of the branches daily. The monitor how they manage their stocks and their staff members. The head office also ensures that the Chinese subsidiaries have enough resources to manage their affairs.

Moreover, they monitor how these subsidiaries use the money allocated to minimize wastage. The measures ensure that the resources of the entity are safeguarded from misappropriation and theft. The head office provides that the operations of all the subsidiaries are standardized. The primary objective is to ensure that it becomes easy to supervise their affairs. For example, all the subsidiaries are expected to use uniform accounting standards.

Furthermore, the headquarters ensure that the subsidiaries operate within the law in the countries in which they operate. The measure provides that there are fewer conflicts between the government and branches. Besides, all subsidiaries report to the head office regularly. Some of the issues they usually report to the headquarters of the enterprise include their daily sales and stock take among other matters (Keene 2017, pg 356. The primary objective is to ensure that it becomes easier to compute the financial statements of the corporation. Another reason is to eliminate any chances of fraud within the entity. The headquarters should also try to solve any conflicts between the branches. Whenever subsidiaries have any differences, it is only the head office can assist in addressing such matters. Therefore, the head office acts as a supervisor to the subsidiaries. In this case, both the subsidiaries and the head office should work closely to attain better results.

Question 3b

The strategic management of a foreign subsidiary is supposed to make individual decisions for the entity. First, they have a responsibility for developing long-term plans that will help the company to attain its objectives in the future. They also develop guidelines that the departmental heads in the production, marketing and public relations should follow. The top management also organizes all the activities in the business and assigns tasks to individuals. The measure assists in attaining the goals of the enterprise. The senior managers of foreign companies have the power to make key appointments in the firm. For instance, they appoint the departmental heads to lead individuals within their sections. This significantly assists in leading the entity to a profitable path. Finally, these administrators assess the tasks of their executives at different levels to make sure that their performance as per the scheduled plans. Without them, the comany cannot be able to accomplish their assignments on time. Therefore, they play an essential role in ensuring that the organization attains significant success.

In addition, there are several decisions that management of a foreign subsidiary can make at the operational level functions. Firstly, the act as a link between middle administrators and the staff members. They disseminate the instructions of the middle managers to the workers. They always listen to their grievances and try to solve them all the time. Furthermore, they ensure that the qualities of services are maintained within the company. The strategy can assist in attracting new clients and retaining the existing ones. These administrators also guide the employees on how to execute their tasks. In this case, they assist the workers to use the materials well and minimize wastage within the firm. Moreover, they supervise all the employees and ensure that discipline prevails in the organization. The managers can also initiate safety measures and train staff members within the entity. However, the power of the administrators depends on their hierarchy or position in the corporation.

3c

Mia may find it difficult to develop a better working association with Louis Chen because of many reasons. The first reason is that the two individuals come from two different cultures. One of them comes from America while the other originates from China. The Chinese culture believes in age and seniority which is not the same with the Americans. The US embraces etiquette and team spirit among its members. The second issue that can cause problems is language barrier. It is challenging for the two individuals to work together because they speak different languages. Therefore, they may not have the same understanding on various matters. The two individuals may also experience differences in their working relationships because of differences in political ideologies. America tends to lean towards a capitalist system while China favors the communist approach. Both nations have different laws that regulate how individuals conduct their operations. Finally, the two individuals may not share the same vision which might make it difficult for them to work together. This has a potential of creating divisions among the two individuals

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