Business Risk

INTRODUCTIONToday’s business environment requires competency in managing risk and selecting business
strategies based on a company’s internal and external analyses.
In this task you will act as a consultant for the company in the given scenario. As you
complete the task, think about the materials you encountered in the course or past projects
you may have worked on that required evaluating risks and conducting risk analyses. You will
be required to apply your understanding to discuss risks and rewards of the market entry;
analyze the company’s strengths, weaknesses, opportunities, and threats (SWOT); and
recommend business strategies.
SCENARIO
A U.S. fishing boat manufacturer is known throughout the United States for its innovative
approach to product design, lean manufacturing, and responsive customer service since its
start three years ago. The mission statement of the company is “We will provide the most
innovative customer-driven design and growth in the industry.” The founders’ ideals for the
company are described in the vision statement: “We will be the most sustainable company in
the industry.” The company’s ethical statement that guides all conduct and decision-making
is “We will make decisions that are sustainable for customers and the environment.”
The company’s founders have created an organizational culture of innovation in which
employees and founders are considered equal partners. The founders have provided
incentives for employees’ creative ideas and created testing laboratories where customers
use the products and provide design feedback. The founders have also invited innovators in
other industries, such as gaming and information technology, to improve on the designs.
The company’s organizational structure is decentralized and provides all employees with
decision-making responsibilities. All company decisions are evaluated by all employees to
ensure that everyone is committed to the decisions. Additionally, all employees can access
the company founders at any time for collaboration, shared decision-making, or relationship
building.
The company has identified an emerging global market opportunity in India for its products.
Successful sales in India could represent a critical moment for the company if the company
establishes strategic partnerships that will increase the likelihood of product success. The
founders hope to capture profits and market share and expand into other parts of Asia within
the first year of selling products in India.
Research indicates market potential for the company’s sales in India because of the
importance of the fishing industry in the country. Fishing and aquaculture are primary
industries in the coastal regions of India. Economic zones have been established to support
the over 14 million people who are an important part of the fishing industry. This industry
makes up 1% of the nation’s gross domestic product and 6.56% of global fish exports
(Department of Fisheries, 2019).
The company’s goal of the market expansion is to be the first foldable fishing boat
manufacturer in India. An origami-inspired foldable fishing boat is the company’s most
popular product. This boat comes designed as a plastic carrying case that unfolds into the
water like an origami paper boat. This boat is suitable for use in calm water, and the boat can
be recycled. The product retails for USD$200.
Traditional fishers in India use nonmechanized boats, which would be ideal for the foldable
boat’s entry into the market. Laws and regulations surrounding the use of nonmechanized
boats favor importing foldable boats, which would be easy for fishers to carry from home to
the water. The business climate in India is open to new partnerships to improve the fishing
experience for those who preserve the natural ecosystem with nonmotorized boats. The
National Fisheries Development Board (NFDB) promotes the use of natural fishing
equipment to reduce disruption to the fishing ecosystem in India (National Fisheries
Development Board, n.d.).
The U.S. boat manufacturer’s founders met with the NFDB to request an endorsement for
their foldable boats because of the product’s sustainable design and net-zero environmental
impact. The founders discovered that the NFDB would only endorse the boat if it was made
of plastics used in India in order to reduce the waste products in the nation’s landfills.
This endeavor would require the U.S. company to make a significant investment in India. The
company would need to purchase or build a manufacturing facility, or it would need to
contract with a facility owner to secure a manufacturing location. It would need to employ
Indian workers. Lastly, the company would need to manufacture a new foldable boat made
from used plastics in India with an environmentally friendly waterproof coating.
The new foldable boat could be designed in several ways, and the company would need to
test a series of plastic products and waterproof coatings to determine which would be
suitable for fishers in India. The fishers range in age from 13 to 70, so the design would need
to be comfortable and portable enough for all fishers in this target group.
The company decides to hire Indian fishers to help design the product to reach this market.
These fishers will provide qualitative, open-ended conversations and data that will be
valuable in communicating the product’s features and benefits to other fishers. The product
will be tested by a variety of fishers who represent different sectors of the fishing industry,
different regions, and different cultural segments. Testing will provide generalizable
qualitative data about the product’s use and effectiveness.
REQUIREMENTS
A. Describe two internal or external risks the given company encounters when entering the emerging
market described in the scenario, including how each risk impacts the company.
B. Conduct a written SWOT analysis of the company in the given scenario by doing the following:
Note: Your analysis should be in written format rather than a chart or graph.
1. Describe two internal strengths of the company, including why each is considered a strength.
2. Describe two internal weaknesses of the company, including why each is considered a weakness.
3. Describe two external opportunities for the company, including why each is considered an
opportunity.
4. Describe two external threats to the company, including why each is considered a threat.
C. Select two of the following business-level strategies you will recommend for the company and
explain how each strategy you recommend is supported by the SWOT analysis results in parts B1–
B4.
• low-cost leadership
• focused low-cost leadership
• differentiation
• focused differentiation
• integrated
1. Justify one of your recommended strategies from part C by explaining in detail how the strategy
will benefit the company in the new market.
D. Acknowledge sources, using in-text citations and references, for content that is quoted,
paraphrased, or summarized.