MS-91: ADVANCED STRATEGIC MANAGEMENT

ASSIGNMENT

Course Code : MS-91

Course Title : Advanced Strategic

Management

Assignment Code : 91/TMA/SEM-I/2011

Coverage : All Blocks

Note: Assignments Solved by www.distpub.com

Q1. Identify the features of Corporate Philosophy and examine it with reference to an organisation (Name and describe the organisation you are referring to).

Q2. Highlight the Corporate governance practices in Indian context.

Q3. “Corporate Philanthropy is considered as a practice by companies of all sizes and sectors making charitable contributions to address a variety of social, economic and other issues as part of their overall corporate citizenship strategy” Discuss.

Read the following case study carefully and give your analytical responses to the questions given at the end.

Amway and its Independent Business Owners

Corporate Social Responsibility (CSR) means businesses and organizations working responsibly and contributing positively to the communities they operate in. It involves working with employees, their families, the local community and society at large to improve their quality of life. Companies that operate in a socially responsible way strengthen their reputations. In business, reputation is everything. It determines the extent to which customers want to buy from you, partners are willing to work with you and your standing in the community.

Amway is one of the world’s largest direct sales organizations with over 3 million Independent Business Owners (IBOs) in over 80 markets and territories worldwide. It is a family-owned business with a strong emphasis on family values. Its IBOs are often couples. Many of these are raising families. They therefore have a strong bond with children. These families are more than happy to partner with Amway, who, as part of its Corporate Social Responsibility strategy, works with UNICEF, the United Nations Children’s Fund.

As a family company, Amway is committed to playing a part in improving the lives of children in need across the globe. In this way, the company is able to show its commitment to the support of global causes. Amway defines a global cause as ‘a social issue affecting many people around the world engaged in a struggle or plight that warrants a charitable response.’ This case study shows how Amway is a business that does more than provide customers with good quality products. It shows the practical realities of Amway’s global commitment and how it plays a key role in the communities in which it operates.

Growth and responsibility

An understanding of how Amway operates as an organization gives a clearer picture of the contribution it can make to help children in need across the globe. Amway’s vision is to help people live better lives. It does this every day by providing a low-cost low-risk business opportunity based on selling quality products. Amway is one of the world’s largest direct sales companies. It has over 3 million Independent Business Owners (IBOs) Worldwide.

UNICEF

Amway distributes a range of branded products. These products are sold to IBOs worldwide. The IBOs are Amway’s links with consumers and the communities in which they operate. The IBOs are self-employed and are highly motivated. They work within the guidelines of Amway’s Rules of Conduct and Code of Ethics, which are about being honest and responsible in trading. IBOs sell to people that they know or meet. They can introduce others to the Amway business.

Typical products that IBOs sell include:

• personal care – fragrances, body care

• skin care and cosmetics

• durables such as cookware and water treatment systems

• nutrition and wellness products such as food supplements, food and drinks.

IBOs play a key part in helping Amway to deliver its Global Cause Programme.In order to give many of the world’s children a chance to live a better life, Amway launched the global One by One campaign for children in 2003. The One by One programme:

• helps Amway to bring its vision to life

• declares what the company stands for

• builds trust and respect in Amway brands

• establishes Corporate Social Responsibility at a high level.

Amway encourages staff and IBOs to support its One by One campaign for children. Since 2001, Amway Europe has been an official partner of UNICEF and has been able to contribute over €2 million (about £1.4 million). The focus is on supporting the worldwide ‘Immunisation Plus’ programme. This involves, for example, providing measles vaccines to children across the globe. The ‘Plus’ is about using the vehicle of immunisation to deliver other life-saving services for children. It is about making health systems stronger and promoting activities that help communities and families to improve child-care practices. For example the ‘Plus’ could include providing vitamin A supplements in countries where there is vitamin A deficiency. Since 2001, Amway and its IBOs across Europe have been supporting UNICEF’s child survival programme.

Developing a strategy

A strategy is an organizational plan. Implementing a strategy involves putting that plan into action. In other words a strategy shows how a business will achieve its goals. The strategy thus enables an organization to turn its values into action. Values are what a company stands for. An important value for Amway is being a caring company. Amway believes in demonstrating this caring approach and this is why it has partnered with UNICEF.

ese values into practice

All Directors design strategies for the whole of an organization. Effective strategies involve discussion and communication with others. The views of IBOs are influential in creating strategies for Amway. Amway’s strategies for corporate social responsibility are cascaded through the organization as shown below:

Amway’s Global Cause strategy involves creating responsible plans that make a difference. However, the strategy is flexible. In shaping the strategy, research was carried out to find out which global causes IBOs support. The results showed that many favoured a cause that helped children. There was a clear fit between Amway’s aims to help children and UNICEF’s ‘Immunisation Plus’ programme for children. From the outset, Amway set out some clear objectives for its strategy. These were to:

• build loyalty and pride among IBOs and employees

• enhance Amway’s reputation as a caring organization

• make a real difference to human lives.

In 2005 Amway UK’s partnership was deepened through becoming an official Corporate partner of UNICEF UK. The Corporate Partnership is a closer longer-term relationship which benefits both partners. Working together the two parties raise money for UNICEF.

Q4. How are principles of corporate social responsibility being followed by Amway?

Q5.What do you understand by strategy? How does Amway develop and implement its strategy?