Business School
Collaborative Delivery Partner: ERC Institute, Singapore
ERCI 708 Strategic Management
Module Handbook 2021-22 (January 2022 Term)
Credits: 15
Level: 7
Programme:
Master of Science in International Business
Module Tutor: Ms. Jenny Yeung
Email:
jenny.yeung@erci.edu.sg
ERCI708_2021-22_Jan 2022
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Module Handbook
ERCI 708 Strategic Management
2022
Instructor: Jenny Yeung
(jenny.yeung@erci.edu.sg; (65) 6349-2727, Room: #01-41)
Module Aims
Companies today have to make a complex set of choices based on a wide variety of options
regarding their markets, their operations and their governance and organisation structures to
take account of increasing competition and globalisation. The aim of the module is to examine
concepts of strategic management in national and multi-national corporations but in a way that
has relevance for smaller businesses.
Emphasis will be placed on the strategic management processes, including strategic analysis,
choice of goals, leadership and the implementation of major change. The module will focus on
case studies drawn from commercial organisations both in the UK and internationally. The
module aims to equip students with a theoretical understanding of the concepts of strategic
management and practical tools to use in analysing significant strategic change.
Learning Outcomes
On successful completion of this module students will be able to:
•
•
•
•
•
•
Understand what a business strategy is and its criticality in achieving sustainable competitive
advantage
Critically evaluate strategic issues and principles of change associated with businesses
operations
Evaluate the factors that need to be considered in analysing a firm’s external environment as
well as the internal core competences of a firm
Take account of corporate social responsibility and sustainable operations
Critically consider issues associated with managing change and ensuring that the strategy is
capable of being implemented
Articulate the management processes and governance required to develop and maintain an
effective strategy
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Learning Strategy
The approach will be based on active and student centred sessions focused on individual and
small-group learning. All sessions will begin with specified expected outcomes and will end with
a summary. The module will utilise a number of case studies as well as the direct experiences of
students as the basis for analysis and debate.
In all sessions, students will be encouraged to relate theoretical input to their own experience
and discuss this with the group. They will be expected to work on assignments between taught
sessions and present their analysis for wider discussion. Many of the sessions will be structured
around a PowerPoint presentation. This together with other sources of supplementary material
will be placed on Moodle. Guest speakers with direct experience of working in businesses will be
invited to present to the students.
Mode of Assessment
Formative
Students will be formatively assessed through active involvement in seminar discussion and
individual/group tasks between and during sessions. This includes the discussion and evaluation
of case studies and academic papers. Feedback will be given during workshops when interacting
with individuals or groups.
Summative
Refer to the table below.
TYPES
Class
Participation
Total 30%
WEIGHTING
SUMMATIVE ASSESSMENT
TASKS
Individual
participation/
discussion 1
(5%)
100 words
•
Individual
participation/
discussion 2
(5%)
100 words
•
Group
Discussion
(15%)
525 words
•
ERCI708_2021-22_Jan 2022
•
•
•
•
SUBMISSION
DEADLINE
Read the case “Telemedicine in the UAE” in
Appendix 1.
Before 6 PM
Post your comment to Moodle based on the
on 25
required task.
January 2022
Participate actively during class discussion.
Read the case “Will Google’s New Union Change
Its Company Culture?” and the additional
reading in Appendix 1.
Post your comment to Moodle based on the
required task.
Participate actively during class discussion.
Read the case “Building Ethical Supply Chains:
The Case of H&M in China” and the additional
reading in Appendix 1.
Before 6 PM
on 8
February
2022
Before 6 PM
on 15
February
2022
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Individual
participation/
discussion 3
(5%)
100 words
Assignment 1
(15%)
525 words
•
The group leader should post the comments to
Moodle. Please indicate only the contributing
members’ names in the posting.
•
Read the case “Emirates Airline: The New Norm
of Air Travel?” in Appendix 1.
Post your comment to Moodle based on the
required task.
Participate actively during class discussion.
•
•
Assess changes impacting on an industry of your
choice and the competitive positioning of your
selected company* within this market by using
frameworks such as (but not limited to):
• PESTLE Analysis
• Porter’s Five Forces Analysis
• Strategic Group and Competitor Analysis
Before 6 PM
on 20
February
2022
2 March
2022
Via Moodle
*Include Introduction, brief description of the
company, and Conclusion in your essay answer.
Individual
Written
Assignment
Total 30%
Assignment 2
(15%)
525 words
As a continuation to Assignment 1, assess the
way the selected company* is organized
structurally and operationally in order to exploit
the prevailing market conditions by using
frameworks such as (but not limited to):
• Generic Competitive Strategy
• Strategy and structure fits, Goold and
Campbell’s design tests
14 March
2022
Via Moodle
*Use the same company as in Assignment 1 and
include Introduction as well as Conclusion in
your essay answer.
Group
Presentation
Total 40%
•
•
•
Read the case “Coca-Cola Brews a Hot
Acquisition: Costa Coffee” and present your
answer based on the given task.
20-minutes
Zoom
Presentation
using Power
Point Slides
Presentation
on 30 March
2022 during
class timing.
Note:
PPT slides &
• The case will be provided three weeks prior recording to
to the submission.
be submitted
• You are required to work with the same via Moodle /
members in the Group Discussion.
Chi Player
• Each student to submit Peer Evaluation form
(by the
via email to jenny.yeung@erci.edu.sg by 4 group leader
April 2022
only) on 4
April 2022
No late submission is allowed for Class participation as it must take place before and during the lesson.
Mark deduction applies for late submission of assignment: 5 percentage points for work submitted
before the end of the day of submission and 10 percentage points for work submitted up to one week
after the due date. No submission will be accepted one week after the due date.
Students who are absent during the assigned presentation date/time will be awarded with zero marks.
ERCI708_2021-22_Jan 2022
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Marking Rubrics
Class participation – Individual Discussion (15%) – Total 50 out of 100 marks
Criteria
Frequency of participation
Quality and relevance of
discussion
Presentation of information
Weighting
20 marks
20 marks
10 marks
Actively and consistently
contributes idea,
comments, questions in all
discussions
Regularly offers ideas /
comments during
discussions
Contributes to almost all
discussions
Information is organised in
a very logical and coherent
way; language is concise.
Rarely contributes to
discussion
Barely participate in
discussion
Display excellent
understanding of the
readings and concept; has
supporting evidence.
Display good understanding
of the readings and
concept; good discussion
Display good
understanding; provide
adequate discussion
Lack understanding;
comments are too short
Display no evidence that
cases were understood
Weakly organized with
some language errors
Posts appear “hasty”; many
language errors
No participation
No participation
No participation
80%
& above
70%
60%
50%
40%
Fail
Information is organised
logically; language is clear
Information lacks logical
sequencing and structure
Class participation - Group posting (15%) – Total 50 out of 100 marks
Criteria
Coherence of the analysis
and development of ideas
Criticality of evaluation in
relation to theory
Appropriateness of
conclusions drawn
Weighting
20 marks
20 marks
10 marks
80%
Critical analysis is evident,
some ideas are present
Excellent evaluation of
theories
Critical analysis is evident,
some ideas are present
Some critical knowledge of
relevant theories
Detailed conclusions are
reached from the evidence
offered
Conclusion is relevant to
both case and theories
Analysis is adequate but
lack new ideas
Analysis tends to be
descriptive
Very little attempt at
analysis
Good evaluation of some
theories
Adequate evaluation of a
few theories
Little or no relation to
theory
Conclusion is relevant to the
case
Conclusion is not fully
relevant
Unclear conclusion drawn
No participation
No participation
No participation
& above
70%
60%
50%
40%
Fail
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Individual Written Assignment 1 (15%) – Total 50 out of 100 marks
Learning
Outcomes
Knowledge and
understanding of
theory and practice
relevant to the
assignment
Critical evaluation of
theories relevant to
the assignment
Relevance of
conclusion drawn
Language, structure,
and Harvard
referencing
Weighting
10 marks
20 marks
10 marks
10 marks
PESTLE Analysis
Assessed
through:
Knowledge and
application of PESTLE
Analysis, Porter’s Five
Forces Analysis, and
Competitor Analysis
(or other framework
in the selected
company & industry
(10 marks)
Overall conclusion of
the impact on the
industry and
competitive
positioning of the
selected company
80%
& above
70%
60%
50%
40%
Fail
Outstanding
comprehension of
the implications of
question and critical
understanding of
theory and practice.
Excellent
comprehension of
the implications of
question and good
understanding of
theory and practice
Good comprehension
of the implications of
question and
accurate
understanding of
theory and practice
Generally accurate
knowledge, though
there may be some
errors of underlying
theory and practice
Limited knowledge
and understanding
with significant errors
of the theory and
practice
Unsatisfactory level
of knowledge and
understanding of
subject
ERCI708_2021-22_Jan 2022
(5 marks);
Porter’s Five Forces
Analysis (5 marks);
Strategic Group and
Competitor Analysis
Language and
structure (5 marks)
Referencing
(10 marks)
(5 marks)
Critical and analytical
evaluation; extremely
well-supported with
elements of originality
Numerous detailed
conclusions are
reached from the
evidence offered
Critical evaluation that
is well-supported with
elements of originality
Several detailed
conclusions are
reached from the
evidence offered.
Exceptionally well
presented in a clear
and logical structure:
no grammatical or
spelling errors;
exemplary referencing
Well presented in a
logical structure:
minimal grammatical
or spelling errors;
exemplary referencing
Good evaluation of
underlying theories,
though not always
able to link accurately
to the question
Some conclusions are
reached from the
evidence offered
Presented in a clear
structure; a few
grammatical or
spelling errors;
consistent referencing
Some attempts at
evaluation but a
tendency to be
descriptive rather than
critical
Largely misses the
point of the question,
evidence mentioned
but used
inappropriately
Very little
comprehension of the
implications of the
question
Adequate conclusion is
made from the
evidence offered.
Adequately presented;
some grammatical and
spelling errors;
inconsistent
referencing
Poorly presented;
many grammatical and
spelling errors; limited
attempt at providing
proper references
Unsatisfactory
presentation: very
limited attempt at
providing references
(10 marks)
Almost no relevant
conclusion was
provided.
No conclusion
provided
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Individual Written Assignment 2 (15%) – Total 50 out of 100 marks
Learning
Outcomes
Knowledge and
understanding of
theory and practice
relevant to the
assignment
Critical evaluation of
theories relevant to
the assignment
Relevance of
conclusion drawn
Language, structure,
and Harvard
referencing
Weighting
10 marks
20 marks
10 marks
10 marks
Knowledge and
application of how
the selected
organisation is
organised structurally
and operationally
Competitive strategy
Overall conclusion of
the way the company
is organised in order to
exploit the prevailing
market conditions
(10 marks)
Language and
structure (5 marks)
Critical and analytical
evaluation; extremely
well-supported with
elements of originality
Numerous detailed
conclusions are
reached from the
evidence offered
Critical evaluation that
is well-supported with
elements of originality
Several detailed
conclusions are
reached from the
evidence offered.
Exceptionally well
presented in a clear
and logical structure:
no grammatical or
spelling errors;
exemplary referencing
Well presented in a
logical structure:
minimal grammatical
or spelling errors;
exemplary referencing
Assessed
through:
(10 marks);
Organisation structure
(10 marks)
Referencing
(5 marks)
(10 marks)
80%
& above
70%
60%
50%
40%
Fail
Outstanding
comprehension of
the implications of
question and critical
understanding of
theory and practice.
Excellent
comprehension of
the implications of
question and good
understanding of
theory and practice
Good comprehension
of the implications of
question and
accurate
understanding of
theory and practice
Generally accurate
knowledge, though
there may be some
errors of underlying
theory and practice
Limited knowledge
and understanding
with significant errors
of the theory and
practice
Good evaluation of
underlying theories,
though not always
able to link accurately
to the question
Some conclusions are
reached from the
evidence offered
Presented in a clear
structure; a few
grammatical or
spelling errors;
consistent referencing
Some attempts at
evaluation but a
tendency to be
descriptive rather than
critical
Largely misses the
point of the question,
evidence mentioned
but used
inappropriately
Adequate conclusion is
made from the
evidence offered.
Unsatisfactory level
of knowledge and
understanding of
subject
Very little
comprehension of the
implications of the
question
No conclusion
provided
Adequately presented;
some grammatical and
spelling errors;
inconsistent
referencing
Poorly presented;
frequent grammatical
and
spelling errors; limited
attempt at providing
proper references
Unsatisfactory
presentation: very
limited attempt at
providing references
ERCI708_2021-22_Jan 2022
Almost no relevant
conclusion was
provided.
Page 7 of 28
Group Presentation (40%)
Criteria
Weighting
Assessed
through:
80%
& above
70%
60%
50%
40%
Fail
Coherent
critical analysis
of the case
study and
relevant theory
The quality of
the proposed
strategy
including the
rationale and
implications
Well organised
information,
with clear aims
and objectives
Ability to
present
information
accurately and
succinctly
Peer
assessment
Group grade
Group grade
Group grade
Individual grade
Individual grade
20 marks
30 marks
10 marks
20 marks
20 marks
4 marks *
6 marks *
5 questions
5 questions
Clear and logical
structure
Presentation
skills
Refer to the
Peer assessment
form
Case is
completely
analysed with
supporting
theory/practice
Rationale and
implication are
well-supported
with elements of
originality
The presentation
is wellstructured; its
organisation
contributes to its
purpose
Speaks clearly
and audibly;
stays on topic
and provide
detailed /
accurate content
Excellent
comprehension
of the case,
theory/practice
Discussion of
rationale and
implication are
given for most of
the main points
Effective delivery
of presentation;
clear speech;
accurate content
Good
comprehension
of the case and
accurate
understanding of
theory/practice
Generally
accurate
knowledge, with
some errors of
theory/practice
Limited
understanding
with significant
errors of
theory/practice
Unsatisfactory
level of
understanding
Discussion is
provided at a
reasonable level
but is not used
effectively
The presentation
is generally
well-structured,
with only a few
flaws in overall
organisation
The presentation
has a defined
structure, but the
organisation is
not optimal
Discussion
contains
unnecessary
or trivial material
The presentation
is sufficiently
structured /
organised
Very little
comprehension
of the
implications of
the question
No
comprehension
is evident
The presentation
is poorly
structured/organ
ised
Convey meaning,
but sometimes
unclear; accurate
content with a
few gaps
Presentation is
not always clear
or easy to follow
ERCI708_2021-22_Jan 2022
Unclear and
illogical structure
Speech is clear;
most of the
content are
relevant and
accurate
Ineffective in
delivering the
presentation
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Peer evaluation form for group presentation (for student’s use)
Each member should fill in one form. Rate yourself and other members based on the evaluation
criteria, using the scale of 1 to 5 below. No marks for Peer Evaluation will be awarded if this form
is not completed and submitted via email to jenny.yeung@erci.edu.sg before the deadline.
1-Strongly disagree
2-Disagree
3-Neutral
5-Strongly agree
Your name:
Group
member’s
name:
Group
member’s
name:
Group
member’s
name:
___ out of 20
___ out of 20
___ out of 20
___ out of 20
Evaluation Criteria
Quality of work:
Complete all given tasks to the
level of quality expected by the
group.
Responsibility:
Complete all tasks according to
the timeline and participate
actively in group meetings.
Participation:
Participate actively in group
meetings.
Contribution of work:
Contribute significantly to
group discussions and overall
project
TOTAL
4 -Agree
Peer evaluation form matrix for group presentation (for lecturer’s use)
Evaluated for:
Student #1:
Student #2:
Student #3:
Student #4:
Evaluated by:
Student #1:
Student #2:
Student #3:
Student #4:
TOTAL (sub-total divided by the
number of group members)
ERCI708_2021-22_Jan 2022
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Timetable
Session
1.
Lesson Dates
19 January 2022
Topic
Introduction to Strategic
Management
Remarks
Briefing on assignments
2.
24 January 2022
Business Environment
Readings of all the cases
3.
26 January 2022
Strategic Capabilities
Discussion of Case 1
4.
9 February 2022
Organisational Culture
Discussion of Case 2
5.
16 February 2022
Corporate Governance and Social Review of Group posting
Responsibility
6.
21 February 2022
Business Level Strategy
Discussion of Case 3
7.
23 February 2022
Corporate Strategy
Consultation - Individual
Assignment 1
8.
2 March 2022
Strategy Methods
Submission of Individual
Assignment 1
9.
7 March 2022
Organising and Strategy
Consultation - Individual
Assignment 2
10.
9 March 2022
Evaluating Strategy
Consultation - Individual
Assignment 2
11.
14 March 2022
Leadership
Submission of Individual
Assignment 2
12.
16 March 2022
Strategic Change
Briefing on Group Presentation
case
13.
23 March 2022
Tutorial
Consultation - Group
Presentation
14.
28 March 2022
Tutorial
Consultation - Group
Presentation
15.
30 March 2022
Group Oral Presentation
Via zoom
ERCI708_2021-22_Jan 2022
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Recommended Readings
Essential Reading (All are available as e-books from the university library)
Whittington, R., Regner, P., Angwin, D., Johnson, G., & Scholes, K. (2020) Exploring Strategy :
Text and Cases. 12th ed. Pearson Education.
www.vlebooks.com/Vleweb/Product/Index/1879949
Mintzberg, H., Ahlstrand, B. & Lampel, J. (2020) Strategy Safari – Your Complete Guide through
the Wilds of Strategic Management. Pearson Prentice-Hall.
www.vlebooks.com/Vleweb/Product/Index/2135080
Media Sources
AsiaOne www.asiaone.com, Australian Broadcasting Corp www.abc.net.au, Business Times
www.businesstimes.com.sg, British Broadcasting Corp www.bbc.com, Channel News Asia
www.channelnewsasia.com/news/business, Financial Times www.ft.com, The Straits Times
www.straitstimes.com/business, Wall Street Journal www.wsj.com/asia
Academic Sources
Asia Pacific Journal of Management
www.springer.com/business+%26+management/business+for+professionals/journal/10490
Strategic Management Journal
http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1097- 0266
British Journal of Management
http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467- 8551
CORE [Open Access Research Papers] https://core.ac.uk
Harvard Business School Working Knowledge http://hbswk.hbs.edu/
Institute for Strategy and Competitiveness http://www.isc.hbs.edu/Pages/default.aspx
Ivey Business Journal http://iveybusinessjournal.com/
Journal of Business Strategy http://www.emeraldinsight.com/journal/jbs
Journal of International Business Studies http://www.palgrave-journals.com/jibs/index.html
MIT Sloan Management Review http://sloanreview.mit.edu/
Directory of Open Access Journals https://doaj.org/
National Library Board Singapore http://www.nlb.gov.sg/
Social Science Research Network www.ssrn.com/en/
Institutional Sources
APEC http://www.apec.org
ASEAN http://asean.org
CIA World Factbook www.cia.gov
Boston Consulting Group www.bcg.com
Dept of Statistics Singapore http://www.singstat.gov.sg/
McKinsey & Co www.mckinsey.com
ERCI708_2021-22_Jan 2022
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APPENDIX 1. CASES FOR CLASS PARTICIPATION
INDIVIDUAL DISCUSSION 1
Telemedicine in the UAE: A Case Study
The global surge in coronavirus cases in early 2020 caused an almost overnight
disruption to clinical services. A solution for continuing critical clinical care of all patients
alongside the need to minimize human-to-human contact had to be found quickly. In
April, Mediclinic Middle East rolled out its coordinated telemedicine service. This
allowed patients who would typically attend one of our units in person to access
assistance from the comfort and safety of their homes. This is how it’s worked out so far...
Finding a safe space
Mediclinic Middle East’s hospitals and clinics are found in three United Arab Emirates
(UAE) cities: Abu Dhabi, Dubai and Al Ain. With seven hospitals and more than 900
inpatient beds, we serve many people in our communities with a variety of serious health
problems. Our patients may be receiving ongoing cancer treatments, having planned
surgery, or may come to us with an acute medical emergency, for example.
Our hospitals are complemented by 20 clinics offering diverse services to fully meet the
primary healthcare needs of the local population. Our patients come to us for wideranging reasons, including dentistry, maternity services, bariatrics, family medicine,
breast cancer screening, and many more. In addition to serving the local resident
population and expatriate communities, we welcome international patients for elective
surgeries and procedures. Our highly regarded cancer treatment center in Dubai is
popular with overseas patients, for example.
When the coronavirus began to cause serious problems and compromised the safety of
our clinics in the UAE, it was clear that we would need to work swiftly to take care of our
patients in a new, unprecedented way. Our patients needed to stay home, and we needed
to move online.
Moving forward
We wanted to continue to provide the same seamless experience our patients are used
to. Our patients benefit from a multi-disciplinary setup which minimizes inconvenience
and makes good use of central administration. In more usual times, our patients can
easily go between our hospitals and clinics to access the appropriate consultations and
treatments as necessary.
Indeed, a foundation of our ability to provide the highest quality clinical care is our
excellent infrastructure. Rigorous high standards have been established and care
processes are regularly vetted by both our own and international standards. Maintaining
this high standard of continuous care was of paramount importance as we looked for
online solutions. A seamless healthcare experience was a must, even under the most
restricted of circumstances.
ERCI708_2021-22_Jan 2022
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The solution
Our response to the coronavirus crisis was to introduce a telemedicine service with two
parts.
1. Video consultation on demand
Our patients can access (and within a short time frame) an on-demand consultation with
a family medicine doctor or general practitioner. The service operates within our normal
working hours in the UAE (Saturday to Thursday, 9am to 5pm). Patients can access
appointments through a web-based platform, found through our website and powered
by an independent telehealth company.
This service fully replicates our non-emergency clinic service. Patients are able to get
prompt advice on their own or their family’s health concerns. They can be referred to a
specialist doctor within Mediclinic if necessary. This on-demand consultation service is
complemented by a new pharmacy home delivery service that can bring prescriptions
for new or existing health conditions.
2. Pre-booked video consultations with specialists
This enables specialist doctors to continue the care of all their usual patients. Patients
seeking advice for new health conditions can also access this service, either through
referral by a general practitioner or by their own request. Our website has a
comprehensive listing of all our clinical staff, enabling patient choice. Telemedicine
appointments with their choice of doctor can be booked through our dedicated contact
center.
In addition, physical consultations remain available at both our hospitals and clinics, if
required. The appointments follow strict COVID-19 safety guidance and infection control
protocols to ensure patient safety. To increase patient choice at these times, many of our
hospital-based clinical staff are also seeing patients in our clinics.
Our findings
Our telemedicine system has been very successful. Here are some of our findings, also
discussed in more detail by Dr. Rahul Goyal, a consultant in family medicine, at the HIMSS
& Health 2.0 Middle East Digital Health Conference & Exhibition on December 1, 2020.
1. More face-to-face time with patients
It surprised many colleagues when they found that telemedicine appointments often
improved communication and dialogue for two reasons. Doctors say they spend more
time focused on their patients during video appointments and are less inclined to look
away at computer screens as they would in an in-person appointment. Secondly, more
time is spent in preparation for each appointment. This has improved patient-doctor
dialogue and has gone some way in off-setting the inability to make a physical
examination.
2. Less stressful consultations
ERCI708_2021-22_Jan 2022
Page 13 of 28
Physicians are also finding that online appointments are less stressful because they are
able to better prepare themselves. There is a resulting reduction in assumptions that
leads to high-quality care. This is especially true for patients who have a comprehensive
medical picture that has built up through our own records. In addition, the recent launch
of Malaffi, the UAE’s first regional health information exchange, has enabled both doctors
and patients to better access longitudinal health records for many more of our patients.
3. Remote care enabled
The Malaffi system has also enabled very fast access to coronavirus test results through
its lab, often before the patient has received the results. This has made timely and
appropriate clinical care for patients possible, even remotely.
We have found that telemedicine has been excellent for the home monitoring of
chronically ill patients. We are able to do visual checks of the patient alongside the remote
extraction of their vitals at regular intervals. This has meant we have been able to alert
families promptly regarding the need for inpatient or additional care, as appropriate.
We have been able to provide reassurance when necessary and have found that video
conferencing has empowered patients (and their parents when the patient is a child)
because they are actively involved in their own care. Telemedicine has been particularly
useful for postnatal care: caesarean section wound checks, lactation consultancy, and
even baby massage classes have all worked well online.
Our future with telemedicine
Beyond the COVID-19 pandemic, we now expect to carry on utilizing telemedicine. We
will continue to find new applications for telemedicine where possible to make the best
use of our resources and maximize convenience for our patients. There will be an
increase in home care services as long as they continue to meet both high-quality clinical
care standards and patient preferences.
To do this, we will be further investing in our digital infrastructure. We will also be
focusing on upskilling and telemedicine training for our clinical staff. This should
improve confidence, which one of the reasons telemedicine was so little practiced until
the pandemic. Just like the American Medical Association, we also call for telemedicine to
be a core competency in the UAE for successful medical students. Telemedicine has
proved itself more than worthy of becoming an integral part of Mediclinic’s future.
Reference:
Batten, V. (2021) Telemedicine in the UAE: A Case Study. Available at:
https://telemedicine.arizona.edu/blog/telemedicine-uae-case-study [16 November
2021]
Task:
Discuss any THREE resources required by Mediclinic Middle East in providing
seamless telemedicine service to its clients.
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INDIVIDUAL DISCUSSION 2
Will Google’s New Union Change Its Company Culture?
Author: Madeline Rae
Publisher: SAGE Publications: SAGE Business Cases Originals Express Case
Publication year: 2021
Online pub date: March 01, 2021
DOI: http://dx.doi.org/10.4135/9781529774825
Abstract
In early 2021, workers at Alphabet, Google’s parent company, announced the formation
of the Alphabet Workers Union (AWU), intended to positively change the company’s
culture and its approach to political, social, and labor issues, which had been the source
of employee tensions, lawsuits, and walkouts. Labor-organizing is something of a rarity
in Silicon Valley, and the case asks students to discuss the union’s objectives as well as
the broader impact the AWU will have on organizing efforts in tech.
The Issue
On January 4, 2021, workers at Google’s parent company, Alphabet, announced the
creation of the Alphabet Workers Union (AWU). The AWU, supported by the
Communication Workers of America labor union, was originally formed by 226 workers
across several Google offices in the United States and Canada and now has over 700
employees from all levels and sectors of Google.
Unlike most labor unions, which are largely focused on collective bargaining to ensure
better wages and benefits for full-time employees, the AWU is a “minority union” made
up of anyone from tech engineers to cafeteria workers, and including independent
contractors, temps, vendors and overseas workers, that seeks to influence the company’s
culture and reshape its approach to political and social issues.
Currently the group cannot collectively bargain with Alphabet (nor will it seek
recognition or collective bargaining rights through the National Labor Relations Board),
which limits its influence and protections under federal labor law, but as an organized
group, it is protected from retaliation by Alphabet.
Just three days after its formation was announced, the AWU made its first big move by
criticizing Google for failing to enforce its own policies when the company did not
suspend Donald Trump’s YouTube account following the January 6 insurrection at the
Capitol. The union said the platform was being used to “spread hatred and extremism”
even as other tech giants such as Twitter and Amazon were cracking down (thanks
largely to pressure from their own employees). Google soon suspended Trump’s account
and removed the Parler app from the Google Play store.
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Why Is It News?
Silicon Valley has largely been a union-busting industry and organizers of the AWU kept
the movement a secret from Google until their announcement. While this is the first union
at a major tech company by and for all tech workers, this union follows the creation of
unions at Kickstarter and Glitch, as well as a tech company cafeteria workers union, all
formed last year.
The union came after increasing activism among Google employees and years of clashing
with management over such issues as the handling of sexual harassment complaints
(leading to a massive worker walkout), taking ad money from hate groups, contracting
with the U.S. Defense Department to use AI technology for drone strike targeting, its
collaborations with repressive governments around the world, the firing of a black
female researcher for being critical of Google’s diversity efforts, and the poor treatment
of contract workers, who make up more than half the workforce at Alphabet.
Wages are not typically an area of concern for full-time Google employees, whose average
salary is upwards of USD 200,000 a year, and the growth of tech jobs across the globe
made it difficult for traditional labor unions to get Alphabet employees to organize.
However, in addition to political and social issues within the content of Google’s work,
the AWU also hopes to address the egregious inequalities within the company, including
the lack of diversity, unfair labor practices, and growing income and wealth inequality.
Ultimately, however, AWU members are not necessarily looking for increased wages or
better benefits, but for more of a say in what their company works on, who their work
will benefit, and how the company will look in the future. In that way, they are the same
as any other labor and trade union in seeking to collectively empower their workers.
This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or
self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall
be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within
your university, and cannot be forwarded outside the university or used for other commercial purposes.
Reference:
Rae, M., (2021). Will Google’s new union change its company culture?. In SAGE Business
Cases. SAGE Publications, Ltd., https://www.doi.org/10.4135/9781529774825
Additional Reading
https://www.businessinsider.com/google-is-the-best-company-to-work-for-inamerica-2016-4
Task:
Discuss how Alphabet Workers Union (AWU) could positively change Google’s
company culture.
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INDIVIDUAL DISCUSSION 3
Emirates Airline: The New Norm of Air Travel?
Author: Kimberly Mathe, Lauren Finnell & Paige Peterman
Publisher: International CHRIE
Publication year: 2019
Online pub date: January 15, 2020
DOI: http://dx.doi.org/10.4135/9781529717792
Abstract
In 2017, the airline industry has been at the center of a number of viral video incidents
ranging from a passenger being injured while being dragged off a United Airline flight, to
an American Airline’s employee challenging a male passenger to a fight. With events like
these, it is an opportune time for an airline to position itself as a leader in customer
service and travel amenities. Emirates Airline, based out of and owned by the country
United Arab Emirates, has long attempted to do just that by providing services to
passengers that go above and beyond many of the standard features one would see on
any of the big three US airline carriers. This case provides an examination of Emirates
Airline, their history, their strategy and positioning, as well as a brief overview of some
external threats and internal strengths and weaknesses for analysis. The accompanying
teaching note provides educators a series of learning objectives to achieve through a
series of discussion, assignments, and a project.
Case
On April 9, 2017, passenger David Dao was forcibly removed from a United Airline’s
flight, hitting his face, rendering him unconscious, leaving him with a broken nose,
missing teeth, and sinus injuries (McLaughlin, 2017). Not two weeks after, an American
Airline’s employee was accused of hitting a woman with a stroller as she entered a plane
sobbing, holding an infant. As a male passenger intervened, during this incident, a fight
nearly ensues with the American Airline’s employee (Karimi, 2017). The year 2017 has
been a year of viral customer service incidents for airlines based in the US, leading way
for United Arab Emirates’ (UAE) based Emirates Airline to showcase their superior
customer service, as they enter new markets worldwide (Brodey, 2017).
In their 30 years of business, Emirates Airline has revolutionized the way the world
thinks of air travel. When flying with Emirates one can expect: complimentary airport
transfer chauffeurs, large and spacious fleets, inflight Wi-Fi and power outlets, onboard
lounge and bar, gourmet dining, pamper kits, optional private suites, refreshing inflight
spa and showers, and television with over 2,000 channels. As mentioned, Emirates
Airline is entering new markets and seeking new routes worldwide. For example, in
March of 2016, Emirates Airline launched the longest non-stop commercial flight in
history. The flight departed from Emirates Airline’s home base in Dubai, and traveled
continuously for sixteen hours to Auckland, New Zealand (Yu, 2016).
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With deluxe amenities being offered by Emirates Airline, this begs the question, is this
strategy feasible, and even more important, sustainable? Atwal and Williams (2009)
suggest that luxury marketing in the travel and tourism industry is particularly difficult
due to its intangible nature. For industries like retail, luxury marketing is a more
reasonable feat. The Holiday Book at Neiman Marcus, a shopping catalog, has a tangible
way of signaling exclusivity and directing attention to a select consumer segment by
listing such items as a $1.5 million private jet available for purchase, or a $100,000 set of
children’s books (Wahba, 2016). But in travel and tourism, one only gets to experience
the luxury while in the airport or on board the flight. There is no take home tangibility,
only a memorable experience.
Emirates Airline claims it does not want to exclude all passengers and only cater to the
most-wealthy. To the average person these aforementioned amenities offered seem
exclusive to the wealthy, but in reality, Emirates Airline also caters to multiple classes of
travelers including: business, government, religious, military, student, and more.
Recently, the company’s objective has been to build on their successful business model
while leading the industry in delivering better efficiencies and customer outcomes
(Emirates Group, 2016).
This case examines the development of the company, investigates luxury branding
through impression and brand management, and delves into some of the strengths,
weaknesses, opportunities, and threats Emirates Airline holds. Through this, the case will
meet the following learning objectives: identifying Emirates Airline’s strategic position
in the international air-space, determine differences in brand management practices
between a luxury and low-cost airline, assess the sustainability of a luxury airline, and
examine how current events, legislation, and other external forces influence Emirates
Airline and the airline industry.
Background and History
Emirates Airline’s story began in 1959 when the Dubai government established dnata to
provide ground handling services at the new Dubai International Airport (Figure 1).
Today, dnata is one of the largest suppliers of combined air services including ground
handling, cargo, travel, and flight catering services, and is the largest travel management
services company in the United Arab Emirates. It is also a subsidiary of Emirates Airline
(dnata, 2017). In 1960, the airport was opened by Sheikh Rashid bin Saeed Al Maktoum
who implemented an open skies, open seas, open trade policy, in part to help eliminate
the country’s dependence on oil resources. More than ever, the “travel and tourism
industries are being actively developed as major revenue generators” (Albers, Koch,
Lohmann, & Pavlovich, 2009, p. 209). The implementation of this policy was one of the
first contributions to building the business-friendly Dubai that we know today.
Discussions then began in 1984 between Sheikh Mohammed bin Rashid Al Maktoum and
Maurice Flanagan, director and general manager of dnata, about launching an airline
based in Dubai. Later that year a business plan was devised, the name of the airline,
Emirates, was chosen, and the decision to build the airline on top of dnata was made. The
next year in 1986, due to infrastructure and expansion costs, the young company would
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post losses for the only time in its history. Nonetheless, the Airbus A310-304 was added
to their line-up the next year, designed to Emirates Airline specifications, giving the
airline the opportunity to further implement their commitment to offering a flying
experience superior to their rivals (Emirates, 2017a).
Figure 1: Historic Photos of Dubai International Airport
(Left-1965; Center-1971, Right-2000)
Over the next several years the company continued to expand its portfolio. By 1988, only
38 months in business, the company had route networks to a total of 12 destinations. On
its sixth anniversary, the airline was servicing 25,000 passengers per week among 23
destinations. Dubai International Airport saw passenger arrivals hit the 11 million mark
in 1999. Emirates Airline’s first flight to New York’s JFK Airport occurred in 2004 and
was marked as the first non-stop passenger flight from the Middle East to North America
(Emirates, 2017b).
Today, Emirates Airline has been the most valuable airline brand in the world for the past
5 years, with an estimated value of $7.7 billion. Emirates Airline’s also operates the
world’s largest fleet of Airbus A380s and Boeing 777s (Emirates Group, 2016). In 2016,
customers recognized Emirates Airline’s outstanding service by awarding the airline
with the title of “World’s Best Airline” at the World Airline Awards (Skytrax, 2017).
Emirates Airline strives to continually invest to improve their products and services to
ensure that they remain a major, if not the top, contender in the international air travel
industry.
Strategy and Positioning
When managing a brand that offers luxury products and services, companies are aware
that it is the status of the product or service that the consumer is purchasing, not the
actual product itself. For the airline industry, a low-cost airline and Emirates Airline will
both get you to the same destination; however, the status of flying Emirates and the
amenities it offers are what makes the product a luxury (Figure 2). Simply put, luxury can
be defined as exclusivity or rarity.
According to the theory of impression management, research states that consumers are
highly affected by the internal drive to create a favorable social image from the outcome
of their purchase behavior (Hennigs, Siebels, & Wiedmann, 2007). Some view luxury as
useless and superfluous because it focuses on the realm of desires rather than necessities
(Mortelmans, 2005). On the other hand, some people crave luxury products solely in spite
of them not being vital to life. The idea of having the “best of the best” is what draws
consumers to luxury products. So much so, that when marketing your business as a
luxury brand, the job is practically done for you. It is human nature to desire the finer
things in life.
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But is luxury what one seeks in an airline? In a typical customer flight experience there
are multiple transaction points one will encounter during their travels (Anderson, Pearo,
& Widener, 2008). Prior research has shown that the most important attributes for inflight service is courtesy of attendants, safety, comfort and cleanness of the seat, and
responsiveness of attendants (Tsaur, Chang, & Yen, 2002). Other research suggests that
services offered between the flight origin and destination, time involved in making the
trip, the value of the service, and baggage concerns are of vital importance to customer
satisfaction (Gursoy, Chen & Kim, 2005).
More research suggests that interactions with flight personnel, the aircraft itself, amount
of personal space, food on the flight, and timeliness of the flight are all predictors of
customer satisfaction; and that these satisfaction levels vary greatly with certain
customer characteristics like age and gender (Anderson et al., 2008). The addition of
luxury into each of these aforementioned drivers of customer satisfaction is what
Emirates seeks to accomplish, and they have been rewarded through numerous public
awards as discussed next.
Figure 2: Actress Jennifer Aniston in Emirates TV commercial showing luxuries like using a tablet while lying
in onboard sleeping suite
Service Awards and Industry Reviews
Emirates Airline continuously and successfully meets the expectations of most travelers
according to many industry surveys and reports. A comprehensive survey from 2010 was
conducted among frequent flyers of seven major airlines operating longer haul flights out
of the UAE (Al-Aali, 2011). These airlines included Air France, British Airways, Emirates,
Etihad Airways, Qatar Airways, Swiss Air, and Virgin Atlantic Airways. The purpose of the
survey was to measure the level of service quality provided in terms of customer
experience from flight booking, all the way through check-in, baggage drop, boarding,
plane conditions, in-flight services, to disembarkation and final baggage claim. Results of
the survey indicated that Emirates Airline outperformed its rivals in each of these areas
(Al-Aali, 2011).
Also, as stated previously, Emirates Airline is a four-time winner of the number one
airline in service since 2001, and has not fallen out of the top five airlines since 2013 as
evaluated by the following categories: ground/airport, onboard: product, and onboard:
staff service (Skytrax, 2017; Table 1). From a subjective perspective of luxury, in 2013
when Air-France-KLM CEO Alexandre de Juniac flew Emirates, he took 15 pages of notes
of his personal experience when flying to take back to his own airline for improvements
(CAPA, 2015). With its long run of awards and accolades, it is inevitable that competitors
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will be curious as to what Emirates Airline is doing differently, and look for ways that
they can implement some of Emirates Airline’s strategies into their own business.
Table 1: List of Top 10 Airlines in 2016
1
2
3
4
5
6
7
8
9
10
Emirates Airline
Qatar Airways
Singapore Airlines
Cathay Pacific
ANA All Nippon Airways
Etihad Airways
Turkish Airlines
EVA Air
Qantas Airways
Lufthansa
(Skytrax, 2017).
Fleet
Emirates Airline utilizes multiple business strategies that have proven successful to the
company, one of which focuses on their impressive fleet of aircrafts. Specifically,
Emirates practices strong environmental commitment by operating one of the world’s
most eco-efficient fleets and also by their involvement with the Dubai Desert
Conservation Reserve. Due to their young age, Emirates Airline’s average fleet age is only
6.4 years old as compared to the IATA average of 11.3 years (GoGreen, 2012). Because of
this, fuel efficiency and CO2 emissions are lower than the IATA average.
But, Emirates has also received some negative attention from competitors who claim
Emirates has an unfair advantage over them. Most of this criticism has come from
European flag carriers, as they have been the most vulnerable in losing valuable
intermediate stop’s in one’s home country (CAPA, 2015). Until 2003, Emirates initial
expansion had gone largely unnoticed until the airline made the largest aircraft order in
history for 71 wide body aircrafts. Today, they are the world’s biggest operator of widebodied jets (Emirates Group, 2016).
Air France has also accused Emirates of ordering too many of Europe’s A380s, claiming
that “it would seem difficult to meet all of their growth targets” (Table 2; Open Sky, 2009).
However, Emirates believes that the A380 best represents the most efficient,
environmentally friendly, and productive large aircraft as they begin to grow their fleet
and implement their replacement strategies. Yet, the large size of the aircraft does impact
their ability to reach certain markets that cannot handle them.
The company also received negative attention when Emirates Airline was able to
promote the growth of their company during the world recession. A spokesperson for
the airline at the time said, “there was no temptation shown by the company to
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compromise standards or adopt a ‘holding operation’ until the world economy
recovered” (Safi, 2011). When the airline industry was in a crisis, Emirates Airline was
still able to generate a profit of $964 million (Safi, 2011). This is counterintuitive to what
typically occurs during a recession; in which large businesses will see sales and profits
decline as costs are cut, and hiring is frozen (Davis, n.d.).
Major competitors have alleged that Emirates Airline and others have benefited from fuel
and infrastructure subsidies (like dnata), lopsided financing and taxation arrangements
and operating outside of the boundaries imposed on commercial airlines. Seeing as
Emirates Airline is owned by the Dubai government and “operates in a tax free
environment with no legacy costs” (O’Connell, 2011), these allegations are not
unwarranted.
Internal and External Stakeholders
Table 2: Airplane (A380) orders placed in 2009 compared to regional population of headquarters
(Open Sky, 2009)
Airline
Emirates
Qantas
Singapore Airlines
Lufthansa
Air France
British Airways
m = millions.
Firm A380
(passenger orders)
58
20
19
15
12
12
Regional Population
260m (Middle East)
36m (Oceania)
568m (SE Asia)
499m (EU)
499m (EU)
499m (EU)
Emirates Airline has seen positive, growth for its return on shareholder investment over
the past five years. With positive growth, the company employs a strategy of rewarding
its shareholders by offering them special privileges and small discounts. Emirates
recorded such a profitable 2016 that they were able to ensure a strong 23.8% return on
their shareholder’s investment (Emirates Group, 2016; Figure 3). This is a major
accomplishment for any business, but shows that Emirates Airline continues to bring in
a remarkable profit and growth of the company while focusing on luxury consumer
elements.
With such strong returns for its investors, it would be assumed that Emirates Airline
would likely be a leader in human resources best practices within the airline industry.
The company consists of 84,000 employees from over 160 nationalities (Emirates Group,
2016), but it has been publicly implied that Emirates fails to treat all of their employees
fairly which can cause poor public relations in today’s highly communicative
environment. Most recently, an Emirates flight attendant reportedly was fired after
falling down the stairs in the company’s signature red high heels (Ward, 2017).
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According to an opinion article found on www.DontFlyEmirates.com titled, “Failure of
recruitment policy in Emirates Airline”, some employees of Emirates are “trapped”
within the company. It claims employees have great expectations when starting a career
with the luxurious airline, but soon after many employees seek out more employee
friendly airlines like, Fly Dubai and Qatar Airways. Supposedly these airlines offer higher
salaries and better employee benefits than Emirates and when employees join the
Emirates Airline workforce they are forced to sign a non-compete contract. Once
employees sign this contract they are committed to only employ with Emirates or are
forced to quit the airline industry altogether (Truth About Emirates Airlines
Management, 2014).
The company counters this, claiming to provide a range of excellent benefits to their
employees and instills a strong diversity policy, as they believe employees are their
biggest asset (Emirates Group, 2017). Other airlines like Southwest Airlines utilize a
perceptually more ethical management practice by providing their employees
competitive salaries and job security (Condemi, Ferguson, Milliman, & Trickett, 1999).
Southwest claims that they are the cheapest airline, yet they continue to rank at the top
of the list in customer service among other airlines. Employees at Southwest enjoy
working for the company because they have “a sense of family” at work and receive great
benefits.
Customer Expectations
With their competitive positioning as the number one airline in 2016, it is expected
Emirates would score exceptionally well in areas such as online booking, transfer
services, cabin cleanliness, quality of food, assistance during boarding, staff attitudes, and
more (Skytrax, 2017). Subjectively, it is rare to find any extremely low customer reviews
when evaluating Emirates. These rare bad reviews all seem to have one thing common,
cabin space (Skytrax, 2016b). Reviews on AirlineEquity.com, which is directed through
Skytrax, indicate that the cramped seating of the business and economy class do not meet
the expectations of consumers. One economy traveler wrote in his review that there was
“not much more room than a cheap airline” on his Emirates flight.
Travelers perceive Emirates as a luxury airline and expect much more from Emirates
than less expensive airlines. The business and economy seats of Emirates Airline are still
priced at a luxury value. Consumers who purchase these tickets expect the space and
comfort of a luxury aircraft. Nevertheless, the first class cabin has more than enough
space to allow for leisure travel. By giving the first class cabin exceptional treatment,
Emirates runs the risk of insulting the business and economy travelers. Some consumers
argue that if a traveler wants first class treatment, they should purchase a first class
ticket. Others may desire that Emirates was more like Southwest Airline, which has only
one cabin level and treats all flyers with the same level of respect.
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Figure 3: Emirates Return on Shareholder Investment (Emirates Group, 2016)
For this reason, branding your business as a luxury company has its drawbacks. A major
risk companies impose on themselves when using the luxury strategy, is expectation. If
consumers perceive a brand to be luxurious, they will expect luxurious customer service,
amenities, and experiences along with the product. The higher the price tag, the higher
the expectations, however, Emirates has priced their product not far from its
competitors, especially for long-haul flights.
External Forces
Changes in the political environment are certain to augment the airline dynamics, in
particular for Emirates Airline. For the US, certain travel restrictions have been
established by United States President Donald Trump. Specifically, Emirates declared it
would cut flights to five US cities because of weakened demand from the travel
restrictions (Cornwell, 2017). From the same restrictions, Turkish Airlines and Emirates
were placed under a ban that would not allow passengers to have laptops in the cabin,
unlike other major US based airlines for fear of bombs (Cornwell & Butler, 2017).
To help in gaining ground in the US, Qatar Airways, one of Emirates largest competitors
is set to begin purchasing up to 10% of American Airline shares in order to expand its
investment in North America (Humphries, 2017). American Airline and other US airlines
are lobbying the federal government saying that overseas brands need more regulation;
as they say, the foreign airlines are “encroaching on their turf” (O’Reilly, 2015).
Conclusion and Questions
Even with an embroiled turf battle with US based airlines, Emirates Airline is employing
US born actress Jennifer Aniston to help in selling flights. It recently has activated a $20
million advertising campaign to increase demand and showcase its luxury amenities, in
particular for traveling families. Emirates Airline’s precedence for luxury has
transformed air travel from a burden into a tranquil experience. The innovative airline
shows no signs of slowing down as it was recently stated that Emirates Airline is
considered the fastest growing airline in the world (Shaban, 2015).
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Emirate Airline has grown so exponentially that the company has announced plans to
invest $32 billion in a second Dubai airport to meet the rapid growth of the airline. The
second airport will be called Al Maktoum International at Dubai World Central (Jones,
2014). Emirates Airlines president, Tim Clark, has stated the airline will soon be the
largest airline on the planet in terms of international passenger traffic. The airline is
expected to have more than 250 aircraft serving 70 million passengers across six
continents by 2020 (Sambidge, 2013). However, until recently, the travel restrictions put
forth by the US may change the growth rate at which these plans are set to happen.
With all of these strengths and weaknesses considered combined with the forces outside
of their control given the political environment Emirates competes in, what should
Emirates focus on next? Currently, Emirates Airlines aims to connect travelers around
the world with luxurious non-stop flights. The airlines rapid growth and success is proof
that the company’s luxurious approach to air travel has been well received, but external
changes and certain weaknesses as discussed may knock the company from its top spot
as number one airlines. Emirates Airlines changed the way passengers saw air travel, but
what can it do next to maintain its position as the world’s number one airline?
This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or
self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall
be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within
your university, and cannot be forwarded outside the university or used for other commercial purposes.
2021 SAGE Publications, Ltd. All Rights Reserved
Reference:
Mathe, K., Finnell, L. and Peterman, P., 2019. Emirates Airline: The New Norm of Air
Travel? London: SAGE Publications, Inc. Available at:
<http://www.doi.org/10.4135/9781529717792> [Accessed 24 Nov 2021].
Task:
Discuss the main drivers of customer satisfaction in flying Emirates Airline and the
differentiation it adds to make the flight experience more luxurious.
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GROUP DISCUSSION
Building Ethical Supply Chains: The Case of H&M in China
Author: Madeline Rae
Publisher: SAGE Publications: SAGE Business Cases Originals Express Case
Publication year:2021
Online pub date: May 03, 2021
DOI: http://dx.doi.org/10.4135/9781529779288
Abstract
The fast-fashion retail giant H&M has effectively been cancelled in China following the
company’s decision to stop using cotton from the country’s Xinjiang region after reports
of human rights abuses and forced labour camps. Retailers have banned its clothing from
online shops and scrubbed its signage and logos from storefronts and maps, state media
and social networks are boycotting the brand, and influencers and celebrities are
speaking out against the company’s decision. Although H&M announced its plans for a
more ethical supply chain last year, the debate has resurfaced following a string of recent
sanctions against China (namely from the United States, European Union, Canada, and
Britain), resulting in the ongoing boycotts. This case reviews the issue and asks students
to discuss the balance between profit and ethics in building supply chains.
The Issue
Last summer, H&M was one of several retailers who announced they would no longer use
cotton from the Xinjiang region in China, citing concerns and increasing consumer
pressure about human rights abuses in global supply chains. Roughly one-fifth of the
world’s cotton is produced in Xinjiang, but news reports suggest that the material from
the region is made in forced labour camps where ethnic minorities are being unlawfully
detained.
Since at least 2016, Uyghurs, a Muslim Turkic minority with just over 12 million people
in Xinjiang, have been “retrained” via imposed labour programs and forced into
detention camps. The Chinese government says the camps are for job training to support
economic development, but evidence suggests otherwise.
In January 2021, the Trump administration banned all imports of cotton from the
Xinjiang region, including products made from the material, accounting for an estimated
1.5 billion garments imported annually by American brands and retailers. On March 22,
Britain, Canada, the European Union , and the United States all announced sanctions on
Chinese officials over the treatment of Uyghurs in Xinjiang, causing China to retaliate
by calling for a boycott against the brands that had spoken out against Xinjiang nearly a
year earlier.
It is not immediately clear why H&M has received the brunt of the backlash, but just hours
after the sanctions were announced, H&M had been cancelled in China, with calls to
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boycott Nike and Burberry soon following. H&M products were pulled from Alibaba
Group’s Tmall and JD.com, China’s most popular e-commerce platforms; buildings and
malls housing physical stores removed H&M signage; app stores removed the H&M app;
and high-tech “airbrushing” techniques erased the storefronts from ride-hailing app Didi
Chuxing and map services operated by Alibaba and Baidu. By the end of March, H&M had
completely disappeared from the Internet in China.
Why Is It News?
Online Chinese retailers bumped H&M from their inventory, a major issue for the fastfashion company since more than a fifth of shopping in China is done online. China’s large
scale makes it arguably the most important sales hub in the fashion industry. The
Communist Party of China often pressures foreign brands to adopt its positions on
sensitive issues or in retaliation over actions by these brands’ home governments. Most
businesses comply with China’s demands because the country is one of the biggest,
fastest-growing markets, particularly for global fashion.
Several singers, actors, and influencers in China broke ties with shoe and clothing
companies who refuse to buy Xinjiang cotton. Influencers in China wield even more
power over consumer behaviour than they do in Western countries and are often needed
to legitimize brands and drive sales in China.
Several other Western brands, on both the luxury and fast-fashion ends of the spectrum,
are struggling to respond to the mounting pressure to condemn the human rights abuses
in Xinjiang without triggering retaliation from the Chinese government and losing access
to one of the world’s biggest and fastest-growing markets. Conversely, other brands like
Anta Sports, FILA China and Muji have either switched to Xinjiang cotton or are
prominently advertising their use of it.
According to a report from Bain & Company, China is expected to be the world’s largest
luxury market by 2025, and is the only part of the world to report year-on-year growth
(reaching USD 52.2 billion last year), making it a market that is forcing many brands to
reconcile their bottom line with ethical supply chains.
This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or
self-study and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall
be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within
your university, and cannot be forwarded outside the university or used for other commercial purposes.
Reference:
Rae, M., 2021. Building Ethical Supply Chains: The Case of H&M in China. London: SAGE
Publications, Inc. Available at: <http://www.doi.org/10.4135/9781529779288>
[Accessed 17 Nov 2021].
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Additional reading
https://www.forbes.com/sites/siladityaray/2021/03/25/chinese-state-media-fuelsbacklash-against-nike-hm-and-others-over-xinjiang-forced-laborstatements/?sh=73c33ee463af
Group Discussion Questions for Posting to Moodle
1. Discuss the ethical approach pursued by H&M in its supply chain.
2. Analyse the impact of its supply chain decision to H&M.
3. What should H&M do next to continue capturing the business opportunity in
China’s market?
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