Research Topics: Cadbury Case Study

Cadbury Research Proposal

Introduction   Governance has existed in the form of company legislation for many years and is not recent phenomenon. Against a background of corporate turbulence in recent years, it has taken on a prominent role since the 1990’s. Beginning with the Cadbury report in 1992, a number of codes and practices have been introduced. These codes require U.K listed companies to comply with their provisions and recommendations on board structure and activities. Whilst good governance is deemed to promote corporate stability and shareholder confidence, it does not contribute to the bottom line and would not prevent corporate disasters such as Enron and WorldCom therefore a question comes to mind – will the shareholders and other stakeholders derive any benefit from the changes to the Combined Code if the Higgs report is adopted.   Much of the focus has been on Institutional Investors, Executive directors and best practice codes, with improving the effectiveness, competency and efficiency of boards. As a result structural and operational aspects of corporate boards have been questioned. (Hermalin and Weisbach, 1998; John and Senbet, 1998; Frank et al, 2001). There has, to date been much comment and speculation but little rigorous research has been on non- executive directors who are most affected by the Higgs proposed changes to the Combined Code.   The context of my research will describe and discuss recent changes in the pattern of work of non-executive directors of large public limited companies in the U.K. An analysis will be made of the impact on their work of the series of reports and codes on the revised combined code which was published in the U.K.in 2003.  This connected series of report and codes was initiated with the publication of the Cadbury Report in December 1992 and a revised version of the combined code published 2003.  In my proposal and dissertation, I will refer to the series of revised reports and codes as the ‘Cadbury series’.   My research findings will be  based on  the views of a group of non-executive directors who, in 2003, would still have been on the boards of large public limited companies, which they would either have joined during, or prior to, 2003.  The target companies will be constituents of FTSE 100 and 250 indexes and because most of these non-executive directors would have served on their boards throughout the changes initiated by the Cadbury series, they will be in the position to assess the impact of these changes on board behaviour within their individual companies.   Research Objectives   The main aims and objectives of the proposed research are:   To explore the structures and patterns of work in the past. In order to achieve this aim a series of interview questions and interviews will be developed to produce summary statistical measures concerning the era before the Combined Code came into force;   To examine and analyse the extent of separation of chief executive and chairman roles, and the proportion of chairmen who were independent at the time of appointment;   To establish the length of tenure of non-executive directors and chairmen along with an examination of the procedures regarding recruitment, appointment and the diversity, skills and expertise on the board; and   To analyse the impact of a Senior Independent director and relate this to a wider examination of the relationship with major shareholders.   Potential Impact of the Research Higgs recommended in his report that the Government and the Financial Reporting Council measure the extent to which behaviour has changed as a result of his proposals and review the progress against his recommendations two years from the date of the review in July 2003. I trust that this research will add and or build upon other research currently being carried out by providing a wide –ranging perspective on the impact of Higgs proposal. Recording the opinions of non-executive directors through which we catch a glimpse of boardroom behaviour and its associated activities, will not only inform and enlighten fellow researchers and  but will also, hopefully, stimulate further analyses on this topic and raise issues concerning contemporary trends and future developments in the corporate world of governance.   Research Methodology As a qualitative research, it will be implemented in two phases. In the first instance, five to six areas of change proposed by Higgs will be the subject of discussion and my main focus of research. Names of non – executive directors will be drawn at random from a variety of public sources of NEDs at both FTSE 100 and FTSE 250 and where necessary lists of names will be purchased to facilitate the process.  A questionnaire will be prepared and presented to the NEDs in question to compare the situation in 1992 /99 with that in 2003 in order to assess the level of change in their involvement and the involvement of their boards in defined tasks and activities.   The second phase of the research will be conducted through semi-structured interviews. They will be asked a series of questions, the responses to which will subsequently be used to test a series of research propositions about the impact of the Cadbury series. Where appropriate, the researcher will match the findings of the research conducted to the specific issues Credit:ivythesis.typepad.com

Cadbury Research Proposal

Introduction Governance has existed in the form of company legislation for many years and is not recent phenomenon. Against a backgro...

CASE STUDY FOR LEADERSHIP CHALLENGE

CASE STUDY FOR LEADERSHIP CHALLENGE           INTRODUCTION                           The contemporary world is a borderless community that values consistent innovation and strategies in all spheres of societal life, rapid transfer of information and goods, and extensive human exchanges. Globalization impacts the lives of people as the Internet, cell phones, and technological gadgets become the avenues for lifestyles, trends, issues and problems to flow across various locations of the globe. Thus, personal choices for living become entwined with what the rest of the world dictates. However, globalization poses greater pressure on business organizations as trade policies become less strict and trade takes place in the international context. Trade liberalization in the age of globalization paves the way for convergence of national economies and gives birth to the multi-national corporations. As the phenomenon of globalization continuous to thrive, international firms and enterprises rearrange their operations to adjust to the demand of the international market. Business expansions outside the country of origin and across national boundaries demand a new set of knowledge, skills and strategies with international orientation. The norm in international business and trade is to develop and manage people who are willing to acquire knowledge of other cultures, languages and business practices, and therefore become capable of managing cultural diversity in light of a global business operation.   ISSUES THAT THE POTENTIAL LEADERS OF CADBURY AUSTRALIA WILL FACE IN THEIR INTERNATIONAL ASSIGNMENTS                            (1993) claims that going global requires transformation of managerial skills learned at the home office to enable the managers to function cross-culturally. Business firms must focus on selecting and training managers to become more attuned to different cultures, particularly in the culture of their country of assignment (). In the case of Cadbury Schweppes, the Board of Directors of Cadbury Australia have identified economy, politics, religion, value systems, and frame of reference of the Chinese consumers regarding the products of Cadbury Schweppes as the primary areas that posed distinct challenges in their expansion to China. Thus, the same aspects merit the attention of the leaders of Cadbury Australia who will be assigned at the company’s branch in China. The Chinese culture and lifestyle are different from those of the Australians and other Western nations where the company operates. Thus, the success of operation in China relies on the ability of the leaders to facilitate business operations in the midst of cultural diversity among the employees and distinct cultural characteristics surrounding the company such as laws, social norms and business practices.             The primary difference in the economies of Australia and China is the orientation. The Australian economy is an affluent, Western-oriented market economy ( 2007) while the Chinese economy adopts the economic style of Soviet Union wherein most of the economic activities are centrally planned by the government. In China, the local officials have immense authority although the economy is open to foreign investment and trade. The regulations state that Chinese firms should have at least 51 percent ownership and control of joint ventures with foreign investors ( 2007).  (2003) reports that it generally takes two to three months to register a business in China with the government putting limits on the company’s business scope (). The difference in the economic orientation of the two countries poses certain challenges to the leaders of Cadbury Australia. These leaders are accustomed to a free market in the Australian economy wherein investors, consumers and producers transact free business and determine the flow of economic activities. In China, they would encounter restrictions in the various operational activities of the company such as production and marketing of certain types of products because the Chinese government pursues the interests of Chinese business organizations. Secondly, China’s transitional economy as cited by  (2003) since the mid-1970s has fostered a tremendous opportunity for international firms to establish operations in the country and made international joint venture as a primary mode of foreign direct investment. However, managing joint ventures sometimes leads to cultural conflicts between Chinese managers and foreign managers. Australians are more Western and their approaches to management clash with the Chinese management approach. Chinese managers rely on interventions from the extended network outside the company to manage risks and threats rather than following the budgets and plans established in advance that are expected to guarantee success. The Chinese managers prefer particularistic and pragmatic solutions to organizational problems by analyzing causes of problems and soliciting outside intervention in problem solving while Western managers like Australians have the tendency to act in reference to a belief in an underlying principle that provides a ready matrix into which current reality and present existence can be fitted. Australians believe that future circumstances can be integrated into the ready matrix which serves as an analytic model to guide decision making processes (p. 147). Considering these differences, the Australian leaders who will be assigned to China may encounter conflicting management styles with their Chinese colleagues. Thirdly, Australia and China differ in religious beliefs. Australians follow Christianity, especially Protestantism, and believe that good works are gifts of hardwork and God’s grace in the life of His believer and not by interventions of outside forces ( 2007). Chinese are more fatalistic and believe that humans must follow their destiny by living in unity with the world of nature and pursuing social conformity ( 2001). Hence, Australian employees would perform their duties based on their personal judgments and decisions while their Chinese counterparts would consistently attempt to abide by the rules and seek opinions of other employees as they are more inclined to seek conformity. These differences in idea of independence would make the leaders of Cadbury Australia consider the outcomes and motivations of their manpower. Australian employees would be motivated to perform well if they are given sufficient freedom at work while Chinese employees may prefer to work in teams and have access to constant supervision. Fourthly, the Australian value systems relative to interpersonal relationships are in conflict with those of the Chinese. Australians as cited by Alon and  (2003) value personal relationships with colleagues and supervisors but organizational hierarchy does not dictate their relationships. They equally communicate and relate to all members of the organization. Chinese employees, on the contrary, prefer a system in which coordination is hierarchical wherein the key institutional values underscore loyalty and submission to a leader whose right is to establish the goals of the group       (). Accordingly, the leaders of Cadbury Australia who would be assigned to manage some operations of Cadbury China have to practice special care in dealing with their Chinese subordinates and fellow supervisors. They may encounter Chinese colleagues who would constantly consult them before they perform their responsibilities. These leaders have to recognize that the Chinese culture places much reverence to leaders while Australians prefer to work independently most of the times. Furthermore, Chinese are conservative chocolate consumers. According to  (2006) most Western goods are regarded as luxuries by Chinese consumers. The average per capita consumption of chocolates in China is less than 50 grams annually which is lower than the consumption of Western countries and other developed Asian countries like South Korea and Japan. This statistics render a challenge for the leaders as they would have to come up with strategies that would make Chinese consumers appreciate chocolates more. Finally, Chinese consumers have a different frame of reference for Cadbury products. Cadbury products are widely popular in Australia and the population enjoys the chocolates and candies manufactured by the company. Presently, Cadbury Schweppes has a 55 percent share in the Australian chocolate confectionery market, leading Nestle (18% share) and Masterfoods (19% share) ( 2006) while the company has a weaker performance in China with a marketing shortfall of around 20 million pounds in 2002 (2003). Thus, the leaders of Cadbury Australia have to design marketing strategies and campaigns to increase consumer awareness about the desirability of the products.   THINGS THAT THE LEADERS SHOULD LEARN BEFORE DEPARTING               The six leaders from Cadbury Australia will be deployed in China for three years to achieve the purpose of expanding operations in the country. Before their assignment they should first obtain knowledge about the country’s culture and different aspects of business practices in China. According to  (2003) in the age of globalization, information and intelligence should be the priorities of global managers. In a restrictive market like China, exhaustive research is one of the keys to success (). It is important that the six leaders should search the Internet, books, magazines, and other relevant sources to increase their knowledge about the culture, languages, business ethics and practices in China before they go on with their assignments. This way, they would be oriented on what the Chinese requires in business processes and thus, ensure that Cadbury would not deviate from what the Chinese culture dictates.             After accumulating intelligence regarding the Chinese market and culture, the leaders can now focus on specific Chinese beliefs in leadership to enable them to tailor their management approach and operational plans for the company. The Chinese culture as argued by  (1996) dictates that business transactions should highlight relationships among the different parties involved in the business operation, especially between supervisors and subordinates ().  (1997) elaborates by saying that a notable characteristic of Chinese leadership behavior is the concept of “Guanxi” which is the Chinese term for “relationships”. The concept of Guanxi refers to the continuous exchange of favors between persons in an organization that ensures the developing, nurturing and sustaining of interpersonal relationships. Guanxi dictates that the Chinese organization is an aggregate of people wherein the leader and his followers try to keep good relationships in order to enhance group cohesiveness and establish a shield against the uncertainties of the uninstitutionalized market economy. Guanxi dictates that the leaders of an organization should protect their subordinates in order to solicit their participation in the accomplishment of organizational objectives. Thus, employees are motivated to contribute to task performance and collective goal achievement while leaders rarely fire their subordinates. Dismissal of employees is considered as a failure of the supervisor because he has not entirely fulfilled his obligation as a “protector” (). The notion of Guanxi is a vital element in effective management at the Cadbury China office. The six leaders from Cadbury Australia should be able to depart a little from the more liberal practice in Australia wherein leaders guide their subordinates and subordinates dictate their performance in order to become effective leaders of Chinese employees. They should be able to recognize that since Guanxi is a guiding principle in Chinese business practices, they should also condition themselves to become protective leaders instead of guiding leaders. Also, the concept of Guanxi can be utilized by the six leaders in soliciting the participation of Chinese officials and other Chinese organizations that are also contributory factors in the success of a multi-national corporation. By pursuing harmonious relationships with the Chinese government, Cadbury would be able to access new business policies and requirements and therefore, adjust organizational practices thereof. This relationship with the government would also make the citizens aware that the company is compliant to the laws, and thus establish a good reputation or customer loyalty. Furthermore,  (1998) states that Chinese traditions mostly emphasize group-oriented values in human interactions and business transactions. This focus on the group makes team management a significant approach in performance evaluation, personnel selection, quality control and project management. Team management has been considered by Chinese businessmen as the best approach to enhance collective culture at work (). The importance of teams or groups in managing business in the Chinese context runs contrary to the business philosophies of most Western nations and Australia for that matter. The Australian culture dictates autonomy in performing business tasks wherein the employees can exercise discretion in the performance of their responsibilities as long as they abide by the organizational processes and procedures. The Chinese culture, on the contrary, values teamwork and supervision.  (1997) argues that the old Chinese saying that “the king shall be the king, and the subjects shall be the subject” applies to Chinese business practices. Leaders formulate decisions and policies which loyal subordinates comply with. This requirement bind supervisors and employees in a close relationship geared toward accomplishment of corporate goals (). In order to adapt to the Chinese culture, the six leaders of Cadbury Australia must be able to incorporate in their personalities and eventually put into practice a form of leadership style that does not eliminate the notions of Chinese Guanxi and teamwork. Studies on cross-cultural leadership practices have found out that managers and employees in all countries and cultures in the world favor democratic styles of management. Managers should direct and not persuade ( 1996). Considering the concept of democratic style in cross-cultural leadership, it is important that the six leaders of Cadbury should be able to familiarize themselves with the theories of democratic leadership. They should be able to accept that the success of any company relies on the collaborative efforts of the managers and employees. Thus, they should be able to formulate strategies on how to promote open communication and active coordination between the various departments of the company’s office in China before their actual assignment. They should also be able to design approaches that would guarantee that the employees have adequate participation in problem solving and decision making. Through the democratic leadership style, the six leaders would be able to abide by the Chinese’s emphasis on relationships and teamwork without losing the Australian orientation on autonomy.      MEASURING THE EFFECTIVENESS OF PROPOSALS               The best way to measure success in international business is through constant monitoring by the mother company. Through monitoring, the head company can gauge expatriate failure or success, and cross-cultural competence of expatriates ( 2006). Cadbury Australia must be able to implement consistent monitoring measures in the operations of Cadbury China and the performances of the employees and the six managers sent to the country.  (2006) state that expatriate failure is oftentimes associated with lost opportunities, reduced productivity, and damaged relationships while expatriate success connotes the accomplishment of the opposite (). Furthermore, cultural competence is measured if the manager assigned at a foreign location possesses a strong personal identity, has knowledge of and complies with the beliefs and values of the culture of the country where he is assigned, demonstrates sensitivity to the affective processes of the culture, communicates clearly in the language of the country of assignment, displays a degree of culturally-sanctioned behavior, nurtures active social relations with the people and authorities of the country, and negotiates the institutional structures of that culture (2006). Cadbury Australia can follow the two strategies set forth above to measure the performance of the six leaders when they start their assignments in China. Basically, the leaders should be able to adapt quickly to the Chinese culture, comply with its requirements while performing their responsibilities, and gain appreciation of the unique processes of doing business in the country. Credit:ivythesis.typepad.com

CASE STUDY FOR LEADERSHIP CHALLENGE

CASE STUDY FOR LEADERSHIP CHALLENGE INTRODUCTION The contemporary world is a borderless communi...

Cadbury

Cadbury Cadbury is one of the world’s largest businesses that is engaged in a chocolate business and positioned itself in the market as one of the company that has a great market share for almost all of the countries. Moreover, the company also spread in the emerging markets most especially in the competitive markets where the company will find another domain. The popular products of the company includes many global, regional and local all-time favorites such as Cadbury Dairy Milk, Flake, Crème Egg, and Green & Black’s in chocolate; Trident, Dentyne ad many other popular brands that  are available in the markets. PESTLE Analysis Political – The Company’s strong advantage is the seniority in business. With that the company can able to manage any adjustment needed in every country. The seniority of the management enables the other foreign country also welcomes the company’s existence because of its competence in the market. Economic – There is no doubt that the Cadbury is making a big contribution in the economies of the foreign country as well as in their own country. The high level or rate of sweet-lovers, the company placed a label as the best choice of the market. Another contradicting factor is the economic downturn that affects all confectionery companies. Social – The impact of the business in the society is really great because of it became sweeteners after every meal. Therefore, many individuals can enjoy the happiness it brings inside the house. In some instances, the other people turned down the idea of eating chocolate because of some serious health problems. In terms of valuing the people, Cadbury recognizes the rights of the workforce and valued the ideas they might contribute for their progress. Technology – From the traditional crafting of chocolates, the company also recognized the importance of technology. From the production, Cadbury had incorporated into many types of machinery that make their production be a cost-efficient procedure. Legal – The ideas of creating a specified taste to be available in the markets. The competitors and the other company making the same nature of business are unique. In terms of the merging and acquisition business, the company recognized the legal aspect that is the basis of the right flow of the business.  Environment – The Company recognizes the certain impacts that they might bring in the environment. There are available strategies and continuous inspection came from the local officials to insure that the resource, as well as the environment is not exploited. Porter’s Five Forces Analysis Supplier Power – The Cadbury has many contracted suppliers that can support their on-going operations. Although there is an existing competition, the raw materials such as nuts or special ingredients are sufficient enough to satisfy their production. The good relationship of the company in their suppliers is considered as an advantage. Barriers to Entry – Since the company is already popular and widely known, Cadbury can earn the trust of the countries. The only hindrance that might affect the production of the Cadbury is to find a good location and gather the requirements for the smooth entry and the foreign policy that might affect the operation. Power of Buyer – The demands is not that high because of the existing health conscious. The price subjectivity of the products is not a question for the people but the increasing number of competitors that offers the same type of products at a lower cost might be the cause of the customer loyalty alteration. Rivalries – Many businesses are competing against the Cadbury and planning to take over the supremacy the company kept for years. The difference of choice depends on the taste ad preferences of the customers. And in the past years, companies like the in the other industries are continuously developing their products or innovating the ideas making it more hard to compete. Threats for Substitutes – There are only a minimum rate for threats which came from the other competitors. The reason behind this is the brand strategy already created by the company. Through their high level of equity, the brand name is transformed into three different categories that make it more effective in the market. It allows the corporate brand name to be combined in supporting the product identification.  Corporate Strategy The company’s board of shareholder values and believes that it is best to achieve the strong performance through the growth of opportunities and maintaining their strong position in the market. In addition, the brilliant minds of the corporate sector are guided by their plans and using the importance of their brand strategy that involved specific targets and continues to focus on it. They addressed in forward looking plans that tries to diminish any uncertainties and challenges involved and exchanged it with strategies based on the assumptions existing in the present markets. This idea will help the company operate for the future and achieve long-term reign. Credit:ivythesis.typepad.com

Cadbury

Cadbury Cadbury is one of the world’s largest businesses that is engaged in a chocolate business and positioned itself in the market as ...

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