Assignment II

1.      Most developed countries have some illegal immigrants. The U.S has the largest number with between 10 and 11 million. Without legal US identification (ID) documents, they cannot open bank accounts or buy houses. Many US firms have targeted this population, accepting the ID issued by their native countries and selling them products and services. Some Americans are furious with these business practices. Other Americans suggest that illegal immigrants represent a growth engine in an economy with relatively little growth elsewhere. How would you participate in this discussion? 

 America is a country with highest number of illegal immigrants around 10 to 11 million. Despite of the fact that, they are the population without legal US identification, they are the ones who have significant control over US economy. This population represents 5.2% of the US labor force. Not only this, these illegal immigrants are the ones who runs the important segment of U.S economy i.e. agriculture. If any major step is taken against the population there would be huge impact on the whole US economy. There would be problem of production as well as labor shortage if the government decides to deport the substantial number of these kinds of workers.

But is it fair for the legal citizen of the country, if the illegal immigrants are provided with the social services and other facilities like opening bank accounts, buying houses, selling products and services. In the perspective of the legal citizen, it wouldn’t be fair but when we look at this issue more deeply the answer will be yes. How? With lots of research and the statements of economists it is concluded that tax revenues generated by immigrants exceeds the cost of services they use. They contribute 10% which amounts to $300 billion to the Social Security Trust Fund. Therefore, the benefit of keeping illegal immigrants is much more higher than deporting them. Also, only small percentage of Native Americans is harmed by the immigrants whereas most of the population are getting benefits from the immigrants.  Hence, as the immigrants play a vital role in the US economy, it will not be harmful if they are provided with certain rights and services. And the misconception about the illegal immigrants representing assault to the sovereignty of the country should be removed, as the native citizens are the ones who are waiting to hire such immigrants for cheap labor and for their benefits.

So what I think is these kinds of views and misconceptions should be revised and the immigration reform should be practically based upon the views of economists and academic researchers.

2.      Explain why it is important to develop cross-cultural literacy. How does that help in doing business internationally?

This is the era of globalization, multicultural and highly diverse workforce where it is essential for the leaders to have the knowledge regarding cultural diversity which is known as cross-cultural literacy. It means being knowledgeable about the fundamental differences across cultures. It has become very important mainly for the managers and leaders to have knowledge about cross-cultural literacy which is a main component of emotional intelligence. And to exceed in this competitive environment it also acts as the competitive advantage over the competitors. One can take full advantage of having knowledge about the various cultures. It helps them to interact and communicate effectively and appropriately with both external as well as internal audiences. This shows how well the organizations perform and it also gives outlook to outsiders regarding the leader’s interpersonal and communication skills.

When the company is planning to go global, it is very important for them to be cross-culture literate. There are lots of examples of companies who failed because they lacked proper cultural knowledge of other countries. This was not only failure of the leader but it cost them the reputation of the whole company. The cross- cultural literate will have knowledge about the high context and low context cultures. One will also have knowledge regarding Hofstede’s Cultural Classification schemes which includes Power Distance Index, Uncertainty avoidance index, individualism, masculinity and long-term orientation. These kind of theoretical knowledge plays a vital role in the practical and business situations. For example: When one has knowledge about the high and low context culture, one can act appropriately in the business situations. They also know how to behave and act in the business situation. This ultimately results in developing healthy business relationship in international level. Not only with business associate, it becomes equally important for the company to maintain same relationship with their employees after all the employees plays crucial role in the success of any business.

3.      Explain the VRIO framework and how to use it to understand a firm’s resources and capabilities?

VRIO stands for Value, Rarity, Imitability, and Organization. It is the tool to examine the firm’s internal resources and capabilities to find out if they can be a source of sustained competitive advantage. At present, almost all of the organization are looking for the ways to gain competitive advantage over their competitors. They use different kinds of models such as porter’s five forces, PEST analysis, Value chain analysis to analyze their external as well as internal environments. One of such tools to analyze firm’s internal resources is VRIO analysis. It consists of four elements if one can meet these it can bring competitive advantage for the company.

Value: Asking a question if a resource add value or not? If yes then obviously the resource is considered valuable. Adding value in the sense that it helps the organizations to increase the customer value which is done by increasing differentiation or decreasing price of the product. If the resource cannot meet the condition, it will be considered as the useless leading to competitive disadvantage.

Rare: The resources which are acquired by few companies is regarded as rare. It will automatically generate competitive advantage even for a short span of time.

Costly to imitate: A resource becomes costly to imitate if others cannot imitate it by any means or it becomes costly to copy the resource. It can occur in two ways; by duplicating or by substituting.

Organized to capture value: The organization should have its management at its best to capture value from its available resources. If they are able to realize the potential of the valuable, rare and costly to imitate resources and capabilities, they will be able to achieve sustained competitive advantage.

This framework can be used by following given steps:

i)                    Identifying valuable, rare and costly to imitate resources

ii)                  Finding out if the company is organized to exploit these resources

iii)                Protecting the resources

iv)                Constantly reviewing VRIO resources and capabilities

4.      Pick any pair of rivals (such as Samsung/Sony, Nokia/Motorola, and Boeing/Airbus) and explain why one outperforms the other.

We have been hearing a lot about Samsung VS Apple these days. One way or another two giant companies always find some ways to outperform one another. Talking about Apple: they have their own set of loyal consumers who stick to their product. These kinds of target groups are the ones who give importance to brand and qualitative products rather than calculating cost and benefits. Whereas when we look at Samsung products, it is comparatively cheaper in terms of price. They have been successful in becoming rival of the giant company like Apple. Despite of apple’s popularity, Samsung has been able to maintain its own position in the market. Samsung’s android phones are giving quite competition to the iOS, Apple’s mobile operating system. Not only they are focusing on their products, but Samsung is spending quite a lot of money in the massive marketing and advertisements. Innovating at a faster pace, it has been able to beat apple in terms of apps and other feathers. Apple is one step farther when it comes to adding new software to its devices. Older apple devices can’t get access to the latest and greatest features. Some of the main reasons why one outperforms another are:

·         Quality

·         Cost

·         Employee Satisfaction

·         Customer centric

·         Marketing Strategy – ( Promotion/ Advertisement)

·         Creating value for stakeholders

 In context of Nepal : we have NTC vs Ncell, two biggest telecom companies of Nepal. NTC is a government owned company whereas Ncell is a private company. NTC is cheaper in terms of price but Ncell is better at providing quality services to its consumers. People chose Ncell over NTC when it comes to quality services as it is very good at the network connections in various districts of Nepal. Not only this, it provides fast internet services, low phone call rates, 3G services allowing the users for the video cast, miss call notifications and many more services. Ncell also spends quite an amount in marketing, advertisements and new offers to customers.

Well the ultimate benefit of these kind of competition is the users so it is good if it brings happiness and quality products and services to the people.