Bad Business and Int. Business (Lecture – 2)

Bad Business

1. Cutting Customer Service Level Decreasing the number of consumer service representative causes the waiting time per customer to increase. This increase in waiting time frustrates the consumers, and ultimately leads them to search for other alternatives with better services.

2. Replacing Representatives with Computers (Automation) Substituting human representatives for automated answering machines have a large impact on the psychology of the consumers. The lack of human interaction have a negative effect on the consumer’s mind. This negative impact causes to problems; firstly the consumer has a fall in their perceived service idea. They seemed to get the idea that the firm/producer is no longer concerned about its consumers after sales. Secondly, inefficiency takes places. A human representative can directly talk about the consumer’s problem and at times understand the unique situations that may take place. However an automated machine does not have the capability to talk about the problem directly nor take hand in a unique situation.

3. Cutting Employee WagesNormal assumption is that cutting down labour will decrease labor cost, leading to a

decrease in the total cost, and finally an increased profitability. However research has shown that the assumption is wrong. Cutting down labor lead only to a fall in profit. This occurred due to two reasons.

Cutting down labor caused a fall in moral in the rest of the employees. When they can see the direct impact on their surroundings, they may be depressed about the sudden change. Another impact would be that the remaining employees will start feeling insecure as they too may get laid off. Moral letdown and insecurity lead the workers to behave inefficiently. Concluding that the profits falls further.

4. Fast growth effort due to SuccessFirms at times in the pursuit of increasing its profits, tries to expand rapidly. During this

rapid growth, the owner(s) of the firm tend to deprive the firm of proper attention. The lack of attention causes the firm to bear improper hiring, providing improper training, and using unstandardized materials in its products.

5. Extreme Fees

Some firms have the tendency to bill exaggerated fees in order to make a large chunk of profit. Simple things that the firm can cover as supplement, are sold separately by the firm. This extreme fees lead the consumers to be frustrated and leaves to find cheaper and better alternatives.

6. Sale of Worthless ProductsFirms providing flawed or imperfect products brings in more attention to its after sale

services or the warranty services. As more consumers complain or goes back to fix the flaw, the reputation of the firm falls.

7. Extremely Strict Hiring QualificationsFirms being rigid on their hiring parameters can lose out exceptionally good people.

Moreover they must be ready to make exceptions when needed to capture the talent pool required to boost the firm’s activities.

International Business Ethics

In the arena of International business, all firms must have a code of conduct for all managers around the world. Managers on their end must be ready to abide by these ethical codes no matter what situation they are in. They must also be ready to sacrifice short term benefits to ensure long term benefits.

1. Internally accepted Human Rights

2. Uphold the Right of Collective BargainingCollective bargaining is performed by the labor union. The theory behind this is that one side can’t be provided with everything. Power and resources must be distributed as such that one side can’t have both. Imbalance causes unethical practices to increase.

3. Avoid being involved with Human Rights Abuse

4. Take no part in compulsory human laborAn employee can’t be forced to work. They have the basic right to decide whether they want to work or not. It is unethical since forced working is in the same terms as slavery. Human Rights can’t be abused in any way during work.

5. To do away with Child LaborIt is not possible to completely eradicate the concept of child labor in the developing countries. It must be understood that the idea about forced child labor isn’t true, rather children take it up on themselves to work to provide for their family. Thus it is better to make alternatives to slowly root out child labor or provide basic skills so that they may have a better future. Examples like schooling at work, food for school, are attempts to provide the basic living skills.

6. To support a caring and cautious approach to environment

7. To reduce any kind of Employment DiscriminationEqual Employment Opportunity states that when a candidate fulfills the basic requirements of a particular job, he/she can’t be disregarded. All must be considered as potential candidates for the job.

8. To encourage Environment Friendly Technology

9. Work to stamp out corruption in all its ugly guises.