The paper answers case questions relating to Apple Inc one of the top technology companies across the world.
1. The main business of the company is to design and develop electronic products online services and softwares. The company deals with the design and development of iphone smartphones and Mac brand of computers.
2. The customers of the company include individual consumers, distributors, wholesalers and other technology related companies. Thus, the company has different types of customers.
3. The customers of technology are the technology-related companies such as Microsoft and Lenovo. For instance, Apple Inc could design softwares needed by Microsoft for developing their computers.
4. The IT vendors in Apple Inc include Intel Corp, Dell Inc., and Microsoft Corp.
5. Apple Inc is seeking to create improved electronics devices including the mobile phones and computers that have advanced innovation to tackle the technological challenges in the society.
The new technology in Apple Inc is developed and engineered by their telecommunications engineers through self-sourcing.
a. The technology was implemented through the design and development of the devices by its manufacturing plants.
b. The company faces the problems of increased costs of production, lack of qualified technicians, and ethical regulations in the industry.
a. The technology of Apple Inc applies to operational effectiveness by the creation of new processes that improves the efficiency of the products. The use of the innovative devices reduces the amount of time taken by companies in the production of the good and services.
b. The technology also improves the strategic positioning of the company by offering support to the long-term objectives of the company
The innovative technologies by Apple inc led to a complete transformation of the internet and mobile industry. Thus, the other companies were forced to create advanced innovations to face the company’ innovative devices.
Apple Inc’s technology is applicable in the value chain due to its ability to initiate effective communication among the different parties in the industry.
Data contains the raw facts relating to different issues in an organization. Data helps to provide the actual situation in the company by giving the firsthand information.
Technology Companies/Cases: Questions to Consider (Bring this document to every class)
(Note: All of the following questions may not be applicable to every company/case)
1. What is the primary business?
2. Who are the customers of the business?
3. Who are the customers of technology?
4. Who are the IT vendors, if any?
5. What is the company specifically attempting to do?
a. What is the business problem? OR What is the business opportunity?
6. Is there a legacy (Older) system(s)?
7. How is the new/updated technology acquired?
i. Purchased off the shelf?
ii. Purchased from a vendor?
b. Lease / Rent?
c. Made / Developed ?
i. Insourcing ?
ii. Selfsourcing ? End-user Development)
2. Consulting Companies / Vendors?
d. Off the Shelf? Customized?
8. How was the System Developed?
a. Were there any problems in or during the development of the system?
9. Number of Systems?
a. Is there one system / software package / database?
b. Are there many interrelated systems/packages that must work together to be the most effective? If so, what are they?
a. What was the initial cost?
b. What is the total cost of ownership?
a. How was the technology implemented?
b. Problems with or during the implementation?
12. What happened? What was the Payoff?
a. Were there any problems after implementation?
b. Does the technology solve the problem or successfully meet requirements?
c. What were the outcomes? What happened after the technology was installed?
13. How does the technology apply to:
a. Operational effectiveness?
b. Strategic positioning?
14. Impact on Industry? New technology can create jarring shocks in an industry. Was the industry affected? If so, how?
15. How is the technology applied in the value chain?
16. What role does DATA play?
17. How do the key terms/concepts apply to this company? Check out the crossword puzzle terms.
18. OTHER? What other key issues are there in this case?
Proposed Changes on the Accounting Standards
Over the years, there have been an existing conflicts and confusion on the use of U.S GAAP and IFRS among the U.S firms. The international Accounting Standards Board (IASB) has proposed certain changes aim at improving the reliability of financial information reported from the various business transactions. The U.S investors also sought to acquire full information relating to the various financial statement items including the lease activities. The proposed changes will be helpful to the U.S firms, as they will provide clarity in financial reporting. Therefore, the paper will analyze the proposed changes by IASB and its effects in the U.S.
Both the FASB and the IASB have agreed to combine the U.S GAAP with the IFRS. The proposed changes by IASB are aligned to the attitudes of CPAs and CFAs to create universal accounting standards. The harmonization of the various standards would improve the quality of IAS provisions. The proposed convergence will improve the overall accounting standards in the U.S. The three main pronouncements to articulate the proposed changes include the revision of the standards relating to revenue recognition, financial instruments, and leases (Anthony & Khondkar, 2012). The revenue recognition standards would be converged to create a single provision. The single revenue recognition provides appropriate framework for reporting all transactions in the industry.
In terms the leases, the proposed changes would clarify on the cases of lease obligations that are not recorded in the balance sheet. Today, the financial statements do not provide a comprehensive analysis of all lease transactions. Thus, the change would promote the reporting of all leases in an expense recognition account for the leases. The proposed adjustments also affect the short-term leases, lease provisions, variable lease requirements, and classifications of the leases. Under the current accounting standards, majority of leases are not separable. The amount can be can be well noted. In addition, the existing accounting models for leases require the involved parties to classify the leases into either capital lease or operating leases. The two leases are accounted for differently (International Accounting Standards Board, 2010). In terms of the capital leases, the lessee recognizes the lease assets and liabilities on the financial statements. In contrast, the operating lease recognizes the least assets and liabilities. Thus, the existing accounting standards have been criticized for not providing a faithful representation of the numerous leasing transitions.
The process would also improve the current financial reporting of the leasing activities as seen under the IFRS. Both FASB and IASB seek to resolve the recent financial crisis experienced across the globe through changing the reporting of the financial instruments. All items comprised among the financial statements such as cash and accounts receivable would be altered in the proposed changes (Erchinger & Melcher, 2007). The accounting standards on the financial instruments would be divided into four parts including classification, credit losses, measurement and hedging. The improvement of the financial instruments would improve the usefulness of the financial statements. Most importantly, it would provide fair value evaluation that focuses on developing consistent disclosure methods. It would also enhance comparability among the companies, industries, and the capital markets.
The proposed changes would bring about a different approach from the existing U.S GAAP in financial reporting. Considering the dynamic nature of financial reporting, IFRS is more suited in responding the dynamic financial climate. The application of the IFRS comprises of principles and appropriate standards that must accommodate the U.S stakeholders (Tarca, 2004). In the U.S, GAAP convergence with the IFRS would create a broader revenue recognition concepts and requirements in the various industries. The new proposals will improve the revenue standards for recognizing all revenue transactions in the U.S economy. The changes will guarantee several benefits including the removal of inconsistencies, creation of a robust framework, enhancing comparability, and offering useful information for decision makers (Heffes, 2013). Legally, the proposed changes would require all U.S companies to disclose all their qualitative and quantitative information relating to their agreements with customers such as analysis of long-term contracts. The U.S GAAP would be forced to require all companies apply the proposed standards.
The proposed changes in U.S GAAP would inform the stakeholders on the different lease transactions in the economy. In order to minimize the accounting standards differences, the revised proposals will include a dual mechanism that promotes recognition, measurement and presentation of the various leases. Most important, the new international accounting standards would provide for full disclosures that enable the investors to make informed decisions. Most of the U.S companies would benefit from improved transparency through the exposure of the respective credit risk and asset risk. The International Accounting standard Boards has been looking forward to improving the comparability of information to provide a greater efficiency and transparency (Heffes, 2013). It also seeks to expose the organization to the high risks emerging from the leasing transactions.
In summary, the proposed changes by the IASB would combine the current U.S GAAP with the IFRS. The efforts are aimed at harmonizing the existing GAAP standards with the international accounting provisions. Even though most of the U.S companies have been resistant on the proposed changes, the proposals would improve the quality of reporting accounting transactions including the revenue and lease transactions. The U.S firms claimed that the IFRS lacks a proper guidance compared to the U.S GAAP that has strict rules and regulations. In spite of all, the changes would reduce complexity and confusion that comes from the use of the two conflicting accounting processes and systems. The overall effect on U.S GAAP is to develop high quality standards and promote the disclosure of information to the various stakeholders.
Anthony, D. H., & Khondkar, K. E. (2012). Loss contingencies face controversy in convergence. CPA Journal, 82(1), 34-39. Retrieved from. http://web.a.ebscohost.com/ehost/pdfviewer/pdfviewer?vid=5&sid=3a6e557d-c5de-40b0-b7a3-eefcf7286197%40sessionmgr4003&hid=4204.
Erchinger, H., & Melcher, W. (2007). Convergence between US GAAP and IFRS: Acceptance of IFRS by the US Securities and Exchange Commission (SEC). Accounting in Europe, 4(2), 123-139.
Heffes, M. E. (2013). FASB, IASB release exposure draft for lease accounting. Financial Executive, 29(5), p.7-8. Retrieved from http://web.a.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=ce00ffa1-d716-4072-8e04-e449c97fe15f%40sessionmgr4001&vid=1&hid=4204.
International Accounting Standards Board (2010). IASB seeks feedback on financial liabilities plan. Financial Management, 6-16. Retrieved from http://web.a.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=e840e20c-7cc0-46b2-b0dc-7523ea6c5420%40sessionmgr4004&vid=1&hid=4204.
Tarca, A. (2004). International convergence of accounting practices: Choosing between IAS and US GAAP. Journal of International Financial Management & Accounting, 15(1), 60-91.
Elements of a Contract
Elements of a Contract
A mere agreement with Fabulous Hotel does not constitute an enforceable contract. The contracts must have the five elements. The elements constitute legally binding contracts preventing any future conflicts or litigation. The first elements are the parties involved in the contract agreements. The parties must be adults and mentally sound persons. Any contract entered with a minor is unenforceable. Also, the contract must have details on the parties entering into a contract (Seaquist, 2012). For instance, the full names, address, and titles. The second element is consent. All the parties involved to the contract should be free and communicate their agreements to the terms and conditions. However, the contracts could be unenforceable if the consent was obtained under duress undue influence or fraud among other related circumstances. Thus, the parties must have a mutual consent on the details of the contracts (Gitman & McDaniel, 2008). Consent also indicates the process of making an offer, free acceptance, and communication between the parties.
A third crucial element in making the contract enforceable is object. There must be a certain subject matter to be agreed on by the parties. The subject matter in question should be lawful and well defined in the contracts. For instance, the law courts would not enforce a contract that deals with an illegal activity and subject such as illegal gun trade. The fourth element is consideration. All valid contracts require considerations meaning the expected benefits from the contract. In our case, the head chef would agree to a certain monthly salary with Fabulous Hotel. The salary constitutes the consideration from the contract entered with the Hotel. The last element is that the contract should be in writing or verbal. Most of valid contracts are expected to be in writing, although verbal contracts are enforceable. The written contracts provide detailed information on the agreements between the parties with certainty. Also, it can be noted that the written contracts are signed by both parties to confirm their objectivity to the agreement (Seaquist, 2012). As a result, the five elements of a contract must be met to constitute an enforceable contract.
Common law governed the contract between Fabulous Hotel and the head of chef. The terms and conditions specified in the initial agreements between the parties cannot be changed. The chef had to wait for two years in order to work in another hotel in the same location. The Uniform Commercial Code (UCC) is not too restrictive compared to common law. Thus, it allows for flexibility in the formation of the contracts. The common laws require that a contract is being after the one party makes an offer, which is accepted by the other party for consideration. In our case, the provisions of common law governed the contract. Also, the contractual agreements related to services, insurances, and employment are governed by the common law (Mann & Roberts, 2013). On the other hand, UCC is involved in the contractual agreements related to tangible objects for example the purchase of land. The contract also had some agreed period and terms. The head chef had agreed not to work for another hotel two years after leaving the hotel. The contractual description matches the requirements of common law for inclusion of quantity, price, and identity of an offer.
However, the UCC governed contracts are only required to specify the quantity. Moreover, the contract above is governed by common law as it met three essential elements of a valid contract. They include offer, acceptance, and consideration. An offer gives the parties an opportunity to assess the terms and description of the subject. The acceptance was done clearly to indicate a contractual bond between the parties. The third aspect of a valid contract is consideration. It explains the value to be exchanged between the parties into the contract (Miller, & Jentz, 2011). Both the Head chef and Fabulous Hotel fulfillment the provisions of common law and thus, creating a valid contract.
In determining the enforceability of the non-compete agreements, the court examines the balance between the interests of the business and the freedom of employees to gain job in other firms. The interests of the both parties must be protected in the enforceability of the non-compete agreements. There are various circumstances under which the non-compete agreements would be unenforceable. First, the nature and character of the employment contract is a relevant factor. It examines the level of access the workers had to the trade secrets of the employers (Seaquist, 2012). If the employee did not have much access to the employer’s trade secrets and customers the non-compete agreement would be unenforceable. In most occasions, the lower levels employees have minimal knowledge on the sensitive information in the business. Second, time and geographical restrictions would make the non-compete agreements unenforceable. The courts usually consider the reasonability of the restrictions agreed with the employer (Beatty & Samuelson, 2007). The court could provide for the period taken for the business to obtain replacement for the leaving employee. As a result, the geographical coverage and period under consideration usually affects the unenforceability of the non-compete agreements.
Another item that could make the agreements unenforceable is the determination is whether the non-compete agreements under the appropriate consideration. The factor implies whether the employees would benefit from the non-compete agreements with the current employers. Thus, if the non-compete agreement signed during employment, the employers should be given something more to benefits (Seaquist, 2012). The court only focuses on the presence of a consideration, but it does evaluate the whether it is sufficient. Therefore, geographical restriction, time limitations, and consideration would limit the enforceability of the non-compete agreements.
Beatty, J., & Samuelson, S. (2007). Cengage advantage books: Essentials of business law. Boston, MA: Cengage Learning.
Gitman, L., & McDaniel, C. (2008). The future of business: The essentials. Boston, MA: Cengage Learning.
Mann, R., & Roberts, B. (2013). Business law and the regulation of business. Boston, MA: Cengage Learning.
Miller, R., & Jentz, G. (2011). Business law today: Comprehensive: Text and cases. Boston, MA: Cengage Learning.
Seaquist, G. (2012). Business law for managers. San Diego, CA: Bridgepoint Education, Inc.
Reckless Driving In the United Arab Emirates
Selected Article: Hammoudi, A., Karani, G., & Littlewood, J. (2014). Road traffic accidents among drivers in Abu Dhabi, United Arab Emirates. Journal of Traffic and Logistics Engineering, 2(1), 1-12.
It is a project in traffic and logistics on reckless driving in the United Arab Emirates.
2. Research Question
The research study sought to evaluate the factors causing increased road traffic accidents in Abu Dhabi, United Arab Emirates. It also sought to prove the hypothesis that increased traffic accidents are caused by young drivers who drives recklessly. The research study is exploratory due to its investigative nature to determine the various factors causing increased road accidents in UAE.
The research study is significant highlighting the various factors that led to increased road traffic accidents in the UAE. In addition, it would provide relevant traffic safety projects and strategies aimed at protecting reckless driving among the citizens. The research would benefit the overall society by minimizing increased costs of hospitalization and loss of relatives. Various traffic safety stakeholders can use the results obtained to create awareness on road safety in the society. I think road traffics accident is a major concern in the society that requires research studies. As a result, the study would indicate the actual road traffics accidents in order to advocate for immediate interventions.
In order to conduct the research study, the study collected the data on the number of road fatalities and the respective age groups. It also collected data on the level of injury to the patients including minor injuries, moderate injuries, serious injuries, and fatality. In addition, data relating to the factors causing traffic accidents in the UAE is collected. The different forms of data were collected to understand the current rates of road traffics accidents as well as the probable causes of road traffic accidents. Data collection was limited to tangible effects such as minor injuries and fatality. Thus, the study could also record the psychological effects observed such as trauma and stress. The research study should have collected data on the economic impact of the road accidents to the immediate families.
The quantitative data methodology was applied through the administration of questionnaires. The respondents taking part in the filling to the questionnaires were a sample size of 600 drivers in Abu Dhabi. The quantitative data methodology was appropriate in gathering tangible data and results for interpretation. More specifically, the questionnaires provided firsthand responses from the participants.
6. Presentation of Data
After data collection and analysis, the researcher presented the data obtained using tables, graphs, and the discussion summary. The graphs and tables were relevant in offering more understandable analysis of the results obtained.
The results show that more than half of the participants were essential in promoting road safety. The researcher also found out that 49 % male and 34% female were involved in road traffic accidents. Based on the various factors considered, the study found out that the usage of seat belts was crucial. Close to 80 % male and 79% female agreed to use mobile phones while driving (Hammoudi, Karani, & Littlewood, 2014). In addition, the survey discussed that 17 % of male and 15% of female drivers were drinking alcohol and driving in the AUE. Almost half of the population had already heard about traffic campaigns. The main central findings include how reckless driving has increased road traffic accidents.
The research study has both strengths and weaknesses. The strengths include the appropriate selection of research methods, data collection and presentation, and discussion of the study findings. The weaknesses of the study include the lack of past literatures on the reckless driving in the UAE. I am convinced by the findings, since the finding have a high correlation with people’s expectations. The presentation of the method section looks comprehensive through the various subunits including pilot survey, sample size, and data collection process among others.
Hammoudi, A., Karani, G., & Littlewood, J. (2014). Road traffic accidents among drivers in Abu Dhabi, United Arab Emirates. Journal of Traffic and Logistics Engineering, 2(1), 1-12.
STRATEGIC CHALLENGES FOR A STARTUP IN MONGOLIA’S EMERGING SOFTWARE INDUSTRY
It was a cold, windy, winter day in early November on the Steppes of Mongolia as the top management at the Modern Information Systems Technology Company of Mongolia (MIST) prepared for their annual “all-hands” meeting. MIST managers presented to the employees in those December meetings, and President Ganaa Baagii along with CEO Naran Buya had personally developed the focus for the 2012 event. In preparation, Baagii had reflected on what he said when they founded MIST: “It is important to build a successful company; however, it has to be built right. ” The year-end meetings were established from the outset to reinforce company values, open communication, engagement and transparency. MIST had started as a firm focused on contract software development in the nascent Mongolian software industry and had quickly prospered, however, its external and internal environments had changed rapidly. Hence, the firm’s top management recognized they needed to stay ahead of the competition and in the 2011 year-end meeting, had focused on developing their own product line. This had caused workload, budget, and interpersonal challenges. As a result, Baagii and Buya focused the 2012 meeting on sustained profitability, an evolving product strategy, and internal challenges to align with the firm’s changing external environment. They were convinced MIST needed to align their strategic framework to evaluate past decisions and generate effective new choices. They also recognized that management inaction would be as imprudent as not preparing for the harsh Mongolian winters.
MIST HISTORY AND MANAGEMENT DILEMMA
Baagii and Buya were college friends. After graduating in 2006, they joined different, large Information Technology (IT) firms as engineers in the emerging Mongolian IT industry. Both ultimately left because they perceived management was reluctant to change their technical and organizational approaches in the quickly moving, global IT industry. In April 2007, Baagii and Buya convinced four friends with experience in system architecture, design and application development to form MIST with 900 USD. Its vision was to develop custom software for domestic enterprises. Three large companies dominated the Mongolian IT industry at that time, but the six founders believed they had the potential to be innovative and differentiate themselves in the custom software marketplace. They were so passionate that they usually started their days saying, “We will show the miracle.”
Company History and Key Events
The founders sustained the firm during its first year based on a strong belief in their vision and focusing on growing their reputation as an innovative, contract-based software development firm. In 2008, one of the founders gave up and joined an established software company in Mongolia stating: “I believe in the vision; but, we are not profitable and I cannot be broke and live the chaotic life of an engineer in a start-up” (see Table 1).
Table 1. Milestones and Key Events in the MIST Evolution
Year Milestones and Key Events
2007 – Company was established in April with six founders
– Vision was set to become a custom software development and consultant company
– After six months, two key founders – Ganaa Baagii (CEO) and Naran Buya(CTO) – left to study in the United States and seek a
partnership with a U.S. company
– Four full-time employees worked on the company. The founders received no salary.
– The company was not profitable in the first year
2008 – Two key founders returned to Mongolia with the first outsourcing U.S. firm project: a smartphone application
– Company modified its vision statement
– MIST maintained the U.S. partnership and established a second partnership in Japan to develop a pilot project
– First custom product, Electronic Newspaper system, was launched within the five largest domestic newspaper agencies
– One founder left the company because of lack of profitability and belief in the start-up
– CEO’s brother, Sanaa (who resided in the United States), joined the company as a founding member
-Six full-time employees worked in the company
– Sales were 105,000 USD with a 29,290 USD loss (see Table 11). Financial reporting started
2009 – First global product was released in the U.S. market and featured via About.com
– Ten full-time employees were working in the company
– MIST’s sales increased to 220,000 USD with first-time positive profit of 19,790 USD (see Table 11)
2010 – CEO Ganaa Baagii’s title was changed to president as he departed to the United States to pursue a master’s degree
– Buya’s title changed from CTO to CEO
– Sanaa Baagii became CTO as part of his move from the United States to Mongolia
– Fifteen full-time employees worked in the company
– Sales increased to 275,000 USD; however, the loss was 22,100 USD (see Table 11) due to the worldwide economic turmoil.
2011 – MIST management decided to increase its team size by 100 percent
– Company adopted product development process know-how from U.S. firms
– MIST established a partnership with three new U.S. customers in California’s Silicon Valley
– Company entered two new verticals (banking and cellular operator) and established partnerships with major domestic firms
– Thirty full-time employees worked in the company
– Sales increased to 473,000 USD and profit was 80,762 USD (see Table 11)
2012 – Company released the first smartphone banking product. This was adopted by the biggest corporate bank in Mongolia
– MIST established new partnership with a manufacturing plant that had a worldwide presence
– IT Associations of Mongolia recognized MIST as the most innovative uprising software development firm in Mongolia
– Turnover (TO) rate was high as newly hired engineers gave up and left the company quickly
– Personnel satisfaction of key, long-term staff decreased. The reason was primarily due to work overload
– Forty full-time employees worked in the company
– Sales increased to 750,000 USD and profit increased to 200,079 USD (see Table 11)
Source: G. Baagii & N. Buya, personal communication, April 21, 2013
Soon after creating the firm, the team developed a vision statement and a set of guiding principles (see Table 2). Baagii and Buya took a bold step and left Mongolia to attend university in the United States. Their goals were to learn the U.S. culture through experience, expand their formal management knowledge base, and seek business partnership opportunities. As absentee leaders, they remained committed to the MIST vision and worked part-time while attending school such as helping to establish their first U.S. partnership in 2008, but the arrangement caused workload imbalances in the Mongolian office. Later in 2008, management returned to Mongolia and modified the vision statement to match their new interest in becoming a global company because the founders believed in the software outsourcing potential in the United States and other countries and soon after, obtained a partnership with a company in Japan.
In 2008, Baagii’s brother Sanaa, a mobile software engineer, joined MIST as a company founder. Sanaa also resided in the United States and became an important management asset
by coordinating overseas projects. An early MIST product was rated the number one application on About.com and it was featured as the best Location-Aware Blackberry application on BusinessWeek.com. In 2008, Buya returned to Mongolia as the Chief Technology Officer (CTO) to help with workload imbalances and he increased “hands-on” leadership. Nevertheless, this
Table 2. MIST’s Vision Statements& Key Principles
To deliver innovative and high-quality products maximizing value for its clients and employees, helping them succeed in a rapidly changing and challenging business world. 2007
To become globally recognized software outsourcing company by delivering innovative and high-quality products to partners. 2008
Key Principles Year
The cores of MIST’s business philosophy were customer and employees’ satisfaction, and corporate social responsibility (CSR). Their fundamental values were to understand that company success was tied directly with the success of their clients. 2007
Source: G. Baagii., personal communication, May 1, 2013
move still left only four employees in Mongolia while two employees resided in the United States. Over the next four years, the leadership mix evolved as MIST gained a solid reputation within the Mongolian market as a top, innovative software development company. By 2012, its customer base increased to fifty, its number of employees expanded to over forty, and revenue was estimated to reach 750,000 USD (see Table 1).
Baagii remembered several strategic management frameworks for evaluating company product selection decisions and firm performance from his graduate studies. The frameworks (see Figure 1) required decision makers to scan the external environment, and match external forces with their internal capabilities before formulating, implementing, and evaluating a successful strategy (Wheelen & Hunger, 2006; Hitt, Ireland & Hoskisson, 2009; David, 2009). Other strategic frameworks existed such as the three component model that combined external and internal capabilities along with an evaluation in the initial analysis component and emphasized a never ending circular flow to strategic planning (Rothaermel, 2012).
Figure 1. Conventional Strategic Framework
Source: Adapted from authors’ notes
Baagii and Buya knew they needed to adopt a strategic framework that aligned their company vision with management decisions and performance.
In his gut, Baagii thought that the task, country and organizational levels of culture he recalled from school had as much influence on non-financial performance metrics (e.g., workload imbalance, employee engagement, turnover and resistance to change) as culture had on financial metrics. He felt his school studies suggested that strategic product strategies were more successful when a human capital strategy was developed and aligned with a viable strategic plan (Lockwood, 2007). However, MIST did not feel they could afford a human-resource (HR) professional or consultant to analyze this alignment. Baagii remembered telling his cofounders in 2007, “Effective leaders set business priorities, and start-up firms need to invest more people and financial resources in software design and implementation that have a direct impact on product cost than increase overhead cost by building support staff and infrastructure.”
MIST followed Baagii’s approach. Since no top managers had the HR background to evaluate the application of Human Capital Theory (HCT), Baagii decided to gather behavioral data on his own. He pulled knowledge from his graduate studies and informal help of experienced friends. Baagii thought his self-help approach was an efficient and effective method to collect pertinent MIST data. He believed that values and behavior (e.g., culture and especially country culture) had noticeable impacts on the behavior of new MIST employees. Thus, he gathered and summarized MIST data by utilizing surveys found online showing four country culture dimensions (see Table 3); current and future (vision) organizational culture data (see Appendix 4); and leadership-style data from two different assessment inventories (see Table 8, p.14). Baagii visually scanned the survey results and muttered, “These engineers like technical solutions based on numbers, but what can I do with all of these soft behavioral numbers that will make sense to them?”
Baagii knew he needed to connect the behavioral information he collected to the product strategy and MIST performance areas he planned to cover at the 2012 year-end meeting. He recalled the Boston Consulting Group product strategy model (Wheelen & Hunger, 2006; Hitt, et. al., 2009; David, 2009; Rothaermel, 2012) because it was based on product and marketplace categories pertinent to MIST and provided clear management directions. The Red-Blue Ocean model (Kim & Mauborgne, 2004) was newer and related to the marketplace differentiation approach that he favored for MIST. These two strategic formulation models helped with selecting a model to match the evolving MIST product line. However, these tools needed alignment with the previously mentioned external and internal environments and a coherent overall strategic framework (see Figure 1).
EXTERNAL ENVIRONMENT: COUNTRY CULTURE AND INDUSTRY SETTING
Mongolian Country Culture
Baagii and Buya knew country culture had a strong influence on work behavior. They had seen how cultural stereotypes reduced opportunities for Mongolian professionals in business, but believed the nomadic lifestyle emanating from the cultural tradition of the Steppes continued to be valued by many Mongolian professionals. Both managers noted that a lack of punctuality, high modesty, high tolerance, and high ambition were reflected in the MIST work environment. When they prepared for their year-end 2012 meeting, Baagii said, “It seems like everybody in this country likes to say: ‘I will make it happen tomorrow.’”
They, and other top MIST managers, believed they had observed many of these country culture attributes related to traditions in the Steppes (see Appendix 1, Table 10) in MIST’s newly hired engineers. One positive effect was their ability to meet tight deadlines due to the high tolerance that Mongolian engineers seemed to have for long work hours. However, their transient culture may have contributed to their high employee turnover (TO) rate. After one of the engineers resigned in 2011, Buya said, “It seems because in our blood we are nomadic, we hate to be attached in one place, but prefer to ride and move around until our middle age.”
Baagii had become interested in country culture research during graduate school. He found that business research linked the pattern of values held by members of a country to organizational culture and firm performance (Hofstede, 1984; Lockwood, 2007; Osland, Kolb, Rubin, & Turner, 2007). To better understand this, he explored country culture research based on the popular Hofstede model (Hofstede, 1984). He found sources indicating that Hofstede’s research concluded national culture is so influential that it often overwhelmed even a strong company culture (Hofstede, 1984; Wheelen & Hunger, 2006).
In one research study, Baagii noted that Wu (2006) had concluded Hofstede’s 1984 study of myriad countries was dated and possibly culturally biased as it was developed by Americans and Europeans who only studied employees from one corporation: IBM. Yet, Wu (2006) identified four of Hofstede’s five dimensions (Long Term Orientation was omitted) that he considered to be work-related dimensions: Power Distance Index (PDI), Uncertainty Avoidance Index (UAI), Individualism (IDV), and Masculinity (MAS). Wu (2006) had analyzed these four work-related cultural values in several different countries for his study (see Appendix 2), and concluded “organizations are cultural-bounded.” While noteworthy, neither study included Mongolia. However, Baagii was aware of a five dimension study of country culture (see Figure 2) that included Mongolia (Badarach, Tkaczyk, & Tureckov, 2010).
Figure 2. Mongolia’s Five Cultural Dimensions
Source: Badarach, Tkaczyk, & Tureckov, 2010
Baagii decided to use a modified Wu survey instrument (see Appendix 2) to collect information about Mongolian culture from MIST employees. He sensed that a recent shift among new employees concerning organizational culture (see Appendix 3) might also exist in company-specific, country culture data. The MIST results were based on thirty managers and engineers that included 23 males and 7 females between the ages of 21 and 40 (see Table 3).
Table 3. Mongolian Company Country Culture Scores
Dimensions PDI IDV MAS UAI
Managers 8 8 8 8
Male 49.38 31.75 30.12 79.00
Female 0 0 0 0
Total 49.38 31.75 30.12 79.00
Engineers 22 22 22 22
Male 63.67 19.00 41.13 77.66
Female 64.29 27.43 45.42 43.00
Total 64.00 21.68 42.5 77.18
Total Sample 30 30 30 30
Male 23 23 23 23
Female 7 7 7 7
Total Score 60.10 24.37 39.20 77.66
Source: N. Buya, personal communication, May 5, 2013
After Baagii reviewed the scores in Table 3, he thought about the influence of the Mongolian country culture on the work behaviors of MIST employees. He knew the market-based strategy that management had developed for the 2012 meeting required organizational values to support it, but realized the founders had not thought about the relationship between organizational values and country values when they developed their vision statement in 2007. Baagii said, “Now, it makes perfect sense why I took the time to develop the employee survey several years ago.”
The Emerging Mongolian IT Industry
Baagii and Buya collected background Mongolian IT industry information from eighteen years prior to founding MIST (see Table 4), to learn the level of competition they might encounter. They discovered that historically, investors in Mongolia preferred tangible businesses such as mining, manufacturing, retail, tourism, and construction. In 1991, the former Communist political party that had primarily driven the economic system changed to a democratic, multiple party system in Mongolia (see Appendix 1, Table 10). The new political system helped to support the new market-based economy. Every citizen of Mongolia was now legally free to start a business and travel anywhere in the world. As the Mongolian economy grew, new domestic software development competitors became established. In response to the increased bargaining power of large customers, these new and smaller firms offered similar contract software development services with the same (or even lower) costs as large established firms in Mongolia.
Baagii and Buya realized that no one was addressing the smaller firms in Mongolia that also needed contract services. Since there was no competition, the bargaining power of those companies was low. The ability of start-up firms to negotiate for supplies and services necessary for contract software development in Mongolia was optimal and entry barriers were low. Yet, the conditions were ripe for future competition and satisfied customers were a requirement. Contract software development and outsourcing were more attractive options than product development that required more capital, longer timeframes and significant risk until profitability could be reached. Hence, the rivalry between IT firms in Mongolia for contract development products increased while firm owned, branded products remained less contested. The small Mongolian market was not an attractive space to start a branded software product line funded by external investors as shown in the eighteen years of Mongolian IT business development (see Table 4).
Thus, the low initial investment in infrastructure and overhead required to start software firms was an important financial and operational incentive that triggered Baagii and Buya to start a custom software development company. As MIST’s management updated their industry information each year for their year-end meetings, they noted an overall lack of venture capital or angel investments until late 2012 (Table 4 and personal communications, Nanzad, 2013). According to Buya, as more and more people started using the Internet and smartphone devices (Mongolia had 500,000-plus smartphone users in 2012 compared to 200,000 in 2011), some investors began to consider funding IT firms by late 2012 (personal communications, Buya, 2012). However, the only technology companies that were able to attract funding from external investors were telecommunication or cellular operators (hardware, not software centric companies). The main reason was the high return on investment that cellular operators were able to command for their investors. Therefore, software development companies remained self-funded and in order for these firms to sustain themselves, they needed consistent contracts, projects, and income.
Table 4. Information Technology Development in Mongolia
Year Key Events
1994 -The Internet was introduced for academic purposes by theMongolian University of Science and Technology’s Computer Science and Management School
1995 – The Internet was made availableto the public by Datacom
– The first software development company was established. It helped private businesses with their day-to-day operations (e.g., accounting and payroll)
1996 -The first cellular operator, Mobicom, was established
2002 -The first Mongolian banking system was introduced to domestic financial institutions. Previously, all financial institutions (including banks) were buying and using expensive international banking software
2004 -The government announced a four-year law to cut sales taxes on personal computers, which helped to increase the penetration rate to 75 percent
2005 -The first outsourcing projects were initiated with a Japanese company
2008 -Many contract-based software development companies opened their doors. There were only two or three companies that had their own products (e.g., ERP and banking systems). The rest (approximately 100) of the companies were very small, contract-based software development firms
2012 -According to the biggest cellular operator, Mobicom, there were 500,000 smartphone users and 1.2 million mobile users overall
Source: G. Baagii, personal communication, April 23, 2013
INTERNAL ENVIRONMENT: CULTURE, STRUCTURE AND LEADERSHIP
Top management agreed that company and task culture, organizational structure and leadership were “core competencies” that allowed MIST to create and differentiate its product from competitors. Baagii’s own data gathering convinced him that the behavioral aspects of a firm and fit within an aligned strategic framework were the keys to sustainability. He reviewed additional research related to culture, structure and leadership and collected data to help support his views.
Buya and Baagii recalled that all three levels of culture (i.e., country, organizational and task) were interrelated since they were based on shared values that potentially affected individual, team and firm performance. Baagii was convinced that company culture and task culture were the keys to MIST’s sustainability because management had more control over these internal items than country values. MIST founders used shared values to develop the key principles and a unique vision statement (see Table 2). Later, he read that shared company values (i.e., corporate or organizational culture) were key enablers of strategy and company success (Cameron & Quinn, 1999; Hofstede, 1984; Lockwood, 2007; Osland, et. al., 2007).
Buya described MIST’s culture to Baagii as “Creative Adhocracy,” characterized by flexibility, innovation, initiation, and adaptation (Cameron & Quinn, 1999). The emphasis on creativity was balanced by a structured software code documentation process. Buya clarified the tension between creativity values and task structure by stating, “We strive to be on the leading edge, and profit is not everything, but our success is gaining a unique (and new) product or service.”
According to the MIST employee survey data (see Appendix 3), Sanaa Baagii (CTO) suggested that about 80 percent of the engineers were satisfied with the company. However, he pointed out, “The early engineers and founders were comfortable with the existing culture, but not newly hired interns, which I suspect account for the remaining 20 percent.” Baagi’s main argument was based on one item in Appendix 3: “Company provided as much initial training as I needed.” He focused on this one survey item because he noted new engineers, with the appropriate technical job expertise, were not oriented in MIST values and became lost in its work environment. On the other hand, “seasoned” engineers and project managers knew the MIST values and refrained from delegating tasks because they were extremely busy with compressed product development cycles. One top manager revealed that although MIST tried to maintain an open culture via the key principles in Table 2 and year-end meetings, the lack of company orientation and task coordination led new members “to drown in the ocean.” For example, when one of the web developers left the company, he joked: “Only God or current engineers at the company can understand the source code, but definitely not junior software developers.”
Baagii recalled from his graduate classes that employees such as engineers, medical doctors and accountants within some organizations formed sub-cultures based on their occupations and these sub-cultures were called task or functional cultures (Trice & Beyer, 1993). He knew from personal work experience that engineers formed task cultures based on the way they used engineering skills to interact in the work environment. The MIST task culture for the first four years was based on contract software development and a rapidly changing job structure. Little existed at MIST in the way of written job duties or task documentation because employees “wore multiple hats,” “the product life was short,” and flexibility, creativity and quick responses were essential for success (Kane-Urrabazo, 2006). Task documentation requirements were never created so if a customer required detailed code documentation under the MIST process, one of the project managers was required to create one instantly while continuing to work on other tasks. MIST’s experienced engineers never included explanations in the source code because each knew the process without any of the documentation that the new engineers required. By 2011, the number of MIST engineers doubled, and while the task culture was flexible and innovative, it was no longer efficient. In 2011, Baagii said, “Although our number of engineers increased by 100 percent, our project delivery times have not increased proportionally or at least by 60 percent and we need a more robust systematic approach.”
While Baagii studied in the United States, he became fascinated with a company called IDEO, that helped him to understand the relationship between the task and organizational cultures (Thomke & Nimgade, 2007). When its CEO (who worked on a team credited with inventing the first mouse for Apple) introduced his company, organizational culture, and product development process, Baagii whispered to himself, “This was my dream to build a company similar to IDEO.” In 2011, MIST’s top management modified and adapted IDEO’s product development process to MIST and the process became a formal part of the task culture. Prior to this, MIST never built a knowledge base for future employees. The revised process (see Table 5) helped MIST to be more organized, and also helped it please its customers. In early 2012, the general manager at the biggest retail bank in Mongolia said, “I remember working with the team two years ago, and I had a good impression; however, that was nothing compared to the last project, which was something new, more organized, well prototyped and well reported.” Baagii expanded his research regarding the impact of culture on work output and customers to include all three cultural levels; but, especially task culture due to the impact on MIST structure and firm success.
Table 5. Product Development Process
1. Exploration 2. Product Designing 3. Product Development 4. Test and Integration 5. Product Release
Team member allocation
Understand user and client needs
Implement high-level specifications
Research similar products from international market Engineering specifications
Rapid couple of prototyping (2-3)
Approve all screen designs based on internal employee survey Front-end and Back-end development based on specs and approved screens
Detailed design Integration with the client-side existing software and database
Verify performance and detailed testing
Marketing plan discussion anddocumentation Submit application to app markets (app world, app store…)
Approve marketing plan
Monitor product performance 24/7
Interview first customers
President/CEO Main Responsibility:
CTO, Lead System Architect Main Responsibility:
Head of Web or Mobile or Desktop Dept. Main Responsibility:
QA in each project Main Responsibility:
Head of Marketing Dept.
Source: Adapted from Thomke & Nimgade, 2007
Organizational Structure and Design
Baagii’s research concerning the relationship between company structure and performance led him to consider firm size and stage of development as key factors for strategy implementation (Wheelen & Hunger, 2006). Myriad sources (Chandler, 1962; Hall & Saias, 1980; Wheelen & Hunger, 2006; Osland, et. al., 2007; David, 2009; Rothaermel, 2012) quoted Chandler’s classic statement that “structure follows strategy,” and recent research showed the reverse was also true (i.e., “strategy follows structure”). MIST was aware that most start-ups went through stages of structural development that matched their strategy implementation (Wheelen & Hunger, 2006).
When MIST was founded in 2007 with six employees, the company organizational chart had a functional design and every manager or engineer reported to the CEO. The functional design made economic sense to MIST’s management since the organizational and task cultures required employees to be specialist and generalists; but, communications across projects suffered. As MIST grew, finances stabilized, outsourcing augmented contract software development, and the structure became hierarchical, a number of levels (hierarchy) was created to clarify roles and improve communication. Engineers reported to department heads, department heads reported to the VP of engineering and CTO, and they, in turn, reported to the CEO. Eventually, each technical function (web, mobile and desktop) wanted their own dedicated engineers, programmers and support staff so a temporary project structure was created (see Figure 3). MIST instituted the IDEO-like product development process previously described in Table 5 to formalize code documentation and a considerable amount of job autonomy was afforded to experienced engineers and programmers. Silos began to develop, and internal communication needed for fast customer support (which was a key principle as stated in Table 2) suffered as a result.
Figure 3. MIST Organizational Chart in 2010
Source: G. Baagii, personal communication, May 19, 2013
The temporary project areas evolved into three product lines: Customer-Based Software Development (CBSD), Software Outsourcing (SO) and Own Product Development (OPD). This change led to overstaffing, and top management’s role was divided into two distinct responsibilities: strategy and operations. Baagii was named president and assigned the strategic role while Buya was named CEO and handled day-to-day operations. Yet, not every MIST project was divided into strategic and operational roles. Operationally, Quality Assurance (QA) was a concern as it remained in each project. Most technical support for CBSD, SO and OPD was borrowed from three functional departments: System Architecture, Mobile and Web Development. MIST evolved to a matrix design that offset overstaffing and both project managers and functional department heads reported to the CEO and president.
In this new matrix structure (see Figure 4), the president and CEO shared the leadership role while Baagii resided in the United States. Buya stated, “This new structure helps team members to deal with the task and organizational culture and communicate more efficiently without delays.” Moreover, Buya believed overstaffing decreased, individual engineers were allocated to projects based strictly on need, and there was more direct communication with top executives and managers. The disadvantages were a lack of coordination, high autonomy during the early stages, and loyalty conflicts between department heads. Management added non-technical support only when absolutely necessary because MIST wanted to maintain a low indirect-direct employee ratio as a cash management strategy.
Figure 4. MIST Organizational Chart in 2011
Source: G. Baagii, personal communication, May 19, 2013
MIST management education and experience (displayed in Appendix 5) reflected a breadth of technical knowledge and experience, but lacked management and leadership experience. Although MIST had been profitable for 2011 and 2012, Baagii and Buya were concerned about the ability of the firm to sustain innovation, competitiveness and profitability in light of increased TO and workload imbalance trends. Baagii observed that new talent acquisition was a tough process in Mongolia, but coordination, adaption and new talent retention were even worse.
Baagii was uneasy about matching a leadership style to the three types of culture, organizational structure, and the stages of product and team development. Therefore, he gathered survey data from different leadership-style assessments based on responses from MIST’s top management (see Table 6). Baagii reviewed the country culture data in Table 3 and Appendices 1-6 to investigate these relationships. The survey data in Table 6 were based solely on leadership assessments he found online. His company experience supported his concern about the match of leadership styles to the work environment. This comparison led him to conclude that MIST should look at leadership and talent management together with engagement and change before looking at financial measures of company success.
Table 6. Top Management and Leadership Style Survey Results
Top Manager Theory X-Y (X=10 to Y=40) Task (T)–People (P) Shared Leadership*
Ganaa Baagii 35 Medium (T:low; P:high)
Naran Buya 25 Medium (T:high; P:low)
Sanaa Baagii 32 High (T:high; P:high)
Nazad Lam 33 Medium (T:medium; P:medium)
Dorj Cheny 30 Medium (T:low; P:high)
Tug Batmon 25 Medium (T:high; P:low)
Khurlee Nanzad 20 Medium (T:high; P:medium)
Khatna Munkhbold 30 Medium (T:low; P:high)
Source: G. Baagii, personal communication, May 20, 2013
Buya conducted interviews with every employee leaving the company which revealed that new engineers “loved the atmosphere,” but believed that their expertise was not enough to keep up with the rapid product development process. Since many managers did not orient new employees to the MIST culture or foster a team atmosphere, new engineers were motivated at the beginning but lost enthusiasm after a couple of months. It was easier for project managers and seasoned engineers to develop and finish projects on their own instead of explaining problems, solutions and documentation to new engineers who had to figure everything out on their own. After several exit interviews, Buya became convinced that turnover (TO) was related to the Mongolian, MIST and task cultures. Management wanted new engineers to speak out concerning cultural or technical suggestions, but they were too shy or humble to comply. When Buya mentioned his exit interview conclusions to Baagii in preparation for the year-end 2012 meeting, Baagii stated, “This sounds like reduced employee engagement that I heard about in my graduate management classes.” Baagii discovered pertinent research online concerning engagement and organizational success. He found employee “engagement” was defined as the extent employees commit to something or someone in their organization, how hard they work, and how long they stay as a result of that commitment (Lockwood, 2007). He discovered that engagement was a critical driver of business success and was supported by management and HR literature (Lockwood, 2007). Baagii found that engagement was a global phenomenon and related to internal factors, such as workplace culture, communications, trust, respect, management style, reputation and leadership style (Lockwood, 2007). Baagii used the MIST data to clarify whether reduced engagement was related to increased new employee TO and the leadership style of managers.
EXTERNAL AND INTERNAL ENVIRONMENTS INTEGRATION
As Baagii prepared for the year-end meeting, he was pleasantly surprised at the diversity of their customer base (see Table 7). The companies were pleased with the quality of software code and MIST’s innovative applications had generated many repeat customers. Baagii and Buya’s school work made them aware of one key research study that showed approximately 20 percent of a firm’s profitability was attributable to its industry, and 36 percent to internal resources (McGahan & Porter, 2002). He decided to collect data to analyze the two environments.
Table 7. MIST Worldwide Customers
North America – World Bank, CHF International, a manufacturing company (NDA), a software development company (NDA), USAID, and numerous start-ups (NDA)
Japan – A manufacturing company (NDA)
China – Healthy Joy
Mongolia – Cabinet Secretary of Government of Mongolia, Ministry of Finance, hotels (NDA),
airlines (NDA), Internet companies (NDA, Magazine and Newspaper editorial boards,
enterprises (NDA), and hospitals (NDA)
Source: MIST Company Records (2012)
While customer support was a known MIST issue, Baagii noted that they had strong technical skills, which was key for capturing the large outsourcing market space both locally and internationally. They enjoyed a solid market share, but had lost some earlier customers to competitors, and wanted to regain them. Furthermore, compared to large firms in their telecom market, MIST didn’t have the same financial resources. While MIST was recognized as an innovative technology provider, competitors were now providing similar cutting edge products and management wanted to increase their lead in the fast-growing domestic economy and become the biggest IT outsourcing company in the country. Mobile and web were two examples of high growth local and international markets.
Baagii reviewed surveys, discussed issues with his team, and identified some conflicting items. For instance, each new employee had problems defining the corporate culture, yet managers and existing employees could not see the issue. He realized from the exit interviews that there was a lack of effective communication with new employees, and a lack of documentation, a knowledge base that experienced staff could easily impart, and a way to measure performance. Bagaii also realized that vision and mission statements were important inputs. He realized from his recent business school studies that the vision statements developed in 2007 and 2008 (see Table 2) were actually mission statements. As a result, current employees were confused about the firm’s vision and stage of development. He also recognized that the information provided in Table 6 identified a leadership mismatch and started investigating other tools.
Baagii had held the strategic role for MIST management since the 2011 organizational change and he endeavored to align the strategic framework and strategy models with product lines. He believed markets and competitors often changed and stated to Buya as they prepared for the 2012 meeting, “In order to become the world-class enterprise, MIST has to think ahead.” The focus of previous “all-hands” meetings were on how to attain profitability, while the focus of this meeting was on sustainability. Baagii wondered which strategic models would best support their current competitive advantages and performance metrics, and also help management identify new products, markets and customers that aligned with the firm’s vision.
The main criterion for selecting MIST’s product offerings was differentiation or uniqueness. Most products were new to the country, and the low initial investments in infrastructure provided first-to-market competitive advantages. Management concluded that MIST’s three current product areas, CBSD, SO, and OPD, held entirely different futures. For instance, the “Banking Solution” within OPD had higher revenue and higher market share forecasts than all the other products (see Table 8 for key performance metrics).
Customer-Based Software Development (CBSD)
When MIST was founded in 2007 with a strategy to target only small local businesses, CBSD was not a new software business area in Mongolia. However, most software development firms overlooked small Mongolian businesses as potential customers because the companies were not willing to pay much. MIST’s founders were willing to sacrifice short-run profits to focus on the domestic small company space, build a success story and leverage this success. They expected to penetrate the small company and start-up space in order to gain a foothold in larger firms. Due to the small and close-knit Mongolian business community, if one business became successful, other firms were willing to develop and install similar solutions. Subsequently MIST became the first pick (see Table 8 for key CBSD metrics).
Table 8. Key MIST’ Product Line Financial, Employee and Competitive Market Metrics
Description/Year 2008 2009 2010 2011 2012
1. Contract-Based Projects (Domestic)
# of engineer 5 6 6 10 15
Revenue ($)* ~75,000 90,000 100,000 200,000 220,000
Profit ($)* 0 6,000 30,000 80,000 100,000
Work balance issue** Low Low Low High High
TO rate** Low Low Low Medium Medium
Market share** Low Low Medium Medium Medium
Market growth ** Stable Increasing Stable Stable Increasing
2. Outsourcing Projects
# of engineer – 1 3 8 11
Revenue ($)* – 8,000 60,000 130,000 160,000
Profit ($)* – 2,000 – 50,000 120,000
Work-balance issue** – Low Low Medium High
TO rate** – Low Low Low Medium
Market share** Low Low Low Low
Market growth ** Increasing Stable Stable Stable Stable
2.2 Outsourcing Projects – smartphone application (Mobile A)
# of engineer 3 6 7 7 7
Revenue ($)* ~30,000 120,000 110,000 100,000 90,000
Profit ($)* 0 20,000 10,000 0 0
Work-balance issue** Low Medium Medium High High
TO rate** Low Low Medium High High
Market share** Low Medium Medium Low Low
Market growth ** Increasing Increasing Stable Decreasing Decreasing
3. Own Product – Banking Solution
# of engineer – – – 5 8
Revenue ($)* – – – 42,000 260,000
Profit ($)* – – – 25,000 170,000
Work-balance issue** – – – High High
TO rate** – – – Low Low
Market share** – – – Low High
Market growth ** – – – Increasing Increasing
3.2. Own Product – smartphone application (Mobile B)
# of engineer – – – 3 6
Revenue ($)* – – – 0 0
Profit ($)* – – – 0 0
Work-balance issue** – – – High High
TO rate** – – – Low Medium
Market share** – – – Medium Medium
Market growth** – – – Increasing Increasing
Source: G. Baagii, N. Buya & K. Nanzad personal communication, May 1, 2013
* Financial numbers are in USD. Only selected product lines are shown. As a result, financial numbers do not equal the totals on the Income Statement (Table 11).
** The Work Balance, TO, Market Share and Market Growth categories are compared to the previous year. For example, data in 2008 is compared to 2007.
Software Outsourcing (SO)
The MIST founders added SO to their vision statement in 2008 (see Table 2). Management developed questions to help hone their interest in the SO area such as “How can we compete with current players who already have earned worldwide respect?” In order to establish trust with potential customers, MIST was required to start SOwith pilot or demo projects that typically had little or no revenue (see Table 8). However, it was the quickest way to build success stories. In 2008, Buya and Baagii signed their first outsourcing agreement with a U.S. partner, which provided resources to develop the first smartphone application (Mobile A). Mobile A was an innovative, reliable smartphone app that users simply downloaded on their smartphones without carrying around additional external devices (see Table 8 for key SO metrics).
Own Product Development (OPD)
MIST started to develop and market its OPD in 2011. Top management believed their future success hinged on brand identity and product development. However, this required a significant inital MIST commitment in financial and human capital (see Table 8). During the annual 2010 year-end meeting, Buya mentioned, “I understand that we are trying to start a whole new vertical that puts our company in a risky position in the short term; however, our current CBSD and SO models put our company in a risky position over the long run.” Top management was aware that CBSD and SO were not self-sustaining models due to large buyers’ bargaining power and increasing competition. In 2011, MIST launched two products on the Internet and in the mobile space in Mongolia. It was a tough decision to select a specific vertical product line, but Baagii’s philosophy was: “If we fail in the consumer space, we can still be profitable in the enterprise sphere or vice versa.” The two Internet based product verticals were a smartphone application (Mobile B) that targeted consumers and a Banking Solution that targeted businesses. The key performance metrics were very different for these two products (see Table 8).
Product Success Repeatability
In deep contemplation one November 2012 evening, Baagii reviewed the differences between creating brand-new products and services for the Mongolian marketplace versus developing products and services to compete with existing ones. He wondered whether there was anything to be learned. It struck him that MIST’s experience launching products and services in Mongolia was a repeat of what had already occurred in the United States (US) market. As he headed to bed and drifted off to sleep, his last thoughts were whether there was a greater chance of strategic success repeating what had already been proven to be successful in the US compared to providing solutions in Mongolia that could not be found in the US.
Although clients were happy to work with the MIST team, MIST’s customer support area required dramatic improvement. The biggest newspaper agency in Mongolia mentioned, “MIST is the most innovative company I have ever hired; however, once they deliver the project, they simply get bored of it.” Could this uneven service level throughout the product life cycle be related to country and organizational culture, workload imbalances, differing products and/or leadership style? In 2011, management had concluded this falloff in customer support was related to the workload imbalances of key personnel (see Table 8).
Another customer area identified for improvement during the 2012 year-end meeting was system maintenance. As technology rapidly developed, MIST’s small and mid-sized customers needed constant support to maintain their systems which they expectedat no additional cost. MIST management offered annual customer system maintenance agreements at 10 to 15 percent of the project fee, however, customers were reluctant to sign them. During the 2010 year-end meeting, Buya pointed out, “Most of the people in Mongolia still associate software as hardware. Similar to buying a PC, they assume that once they pay for the software, it should work at least two to three years without troubleshooting.” The interactive nature of customer issues with culture, workload imbalance and leadership was noted again. As a result, MIST strictly focused on long-term partnerships with key customers worldwide starting in 2011 (see Table 7). These long-term partnerships included fixed project costs as well as system support that yielded, on average, 12 percent of the actual cost annually. These long-term customers were strategically important for MIST’s future and their Own Product Development (OPD) line.
Baagii and Buya created their year-end 2012 PowerPoint slides to feature selected financial, human capital and marketplace metrics using estimates when exact numbers were not available (see Table 8). They planned to show the new product line information to all employees, ask them what personal and organizational challenges the changes caused, and discuss possible solutions.
Baagii and Buya developed the combination of metrics in Table 8 that included Workload Imbalance. Low was defined as less than or equal to eight hours per day; medium was more than eight hours per day plus Saturdays, and high was more than ten hours plus Saturdays and Sundays. Turnover (TO) rate categories were also displayed as either low (0%-10%), medium (11%- 35%), or high (36% – 50%). Baagii planned to ask employees at the meeting whether lower employee engagement existed and if so, whether it was related to talent management and TO? Baagii believed the answer was related to leadership and financial performance due to the expensive turnover items that had the potential to lower future profits. Market share metrics were also divided into low (0%-10%), medium (11%-30%), and high (31%-70%). Only three growth categories (decreasing, increasing or stable) were available for the 2012 market metrics.
MIST also decided to grow their own management talent and generated investment funds from personal investments and firm profits. In 2007, Ganaa and Sanaa Baagii owned approximately 30 percent of the stock which qualified MIST as a family business. However, MIST’s founders decided to sell proportional shares to an outside investor to raise funds for the new strategic direction. In 2012, MIST had six founders who owned approximately 70 percent of the company; the balance (30 percent) was owned by the outside investor (see Appendix 5) who was a long-term client that joined the MIST Board of Directors (BOD) in mid-2012. MIST’s BOD, including the investor, agreed to start the investment in 2013.
Strategic evaluation was the last step in the previously mentioned strategic framework (see Figure 1). MIST did not want the evaluation of firm performance to be limited to financial measures (see Tables 11-13 in Appendix 6) for five years of traditional financial reports that Baagii and Buya used as a basis for creating the key product line metrics inTable 8). Baagii and Buya stated, “P&Ls show that MIST was doing fine financially for the last two years.” However, they worried about whether MIST could develop a winning product strategy and internal capabilities to sustain this short-run success with metrics that management could review periodically to provide mid-course corrections. Hence, in addition to the general indicators for key product lines in Table 8, MIST management reviewed a number of key financial ratios to obtain a more complete picture of the firm’s sustainability (see Table 9).
Table 9. Five Years of Key MIST Financial Indicators
($ Values) 2008 2009 2010 2011 2012
Current Assets 52,710 224,200 408,300 619,362 832,072
Current Liabilities 17,000 19,200 124,400 124,400 47,931
Working Capital 35,710 205,000 283,900 494,962 784,141
Total Assets 87,710 279,700 560,800 764,862 941,572
Total Liabilities 17,000 19,200 124,400 124,400 47,931
Revenue 105,000 275,000 473,000 610,000 809,000
Profit/Loss from Operations (29,290) 76,990 175,900 226,735 281,310
Cash and Cash Equivalents (27,290) 56,490 184,100 211,062 212,710
Current Ratio (Absolute) 3.10 11.68 3.28 4.98 17.36
Market Value of Equity 70,710 260,500 436,400 640,462 893,641
Source: MIST Company Records
Baagii knew from his graduate studies that when financial performance was inconsistent, firms often utilized both traditional and integrative financial techniques to interpret their strategic financial performance (Wheelen & Hunger, 2006; Barney, 2010). Since MIST was a startup firm without a consistently strong profit record (see Table 11 in Appendix 6), sustainability had to be a key management concern. Baagii was aware that traditional integrative financial tools such as the Dupont formula and Altman Z statistic existed to provide a more complete financial picture of MIST’s solvency by combining traditional ratios in formulas and multivariate statistical formats (Wheelen & Hunger, 2006; Barney, 2010; Altman, 2013). However, traditional and integrative financial indicators of corporate performance were now only the starting place for firm performance and strategic evaluation (Kaplan & Norton, 1996; Wheelen & Hunger, 2006; Hitt et al., 2009; David, 2009; Rothaermel, 2015). When non-financial indicators were also available to reflect the interests of a company and multiple stakeholders, the Balanced Score Card (BSC) approach gained widespread business interest (Kaplan & Norton, 1996; Wheelen & Hunger, 2006; Hitt et al., 2009; David, 2009; Rothaermel, 2015). One remembered Kaplan & Norton’s (1996) suggestion that a BSC approach composed of financial indicators as well as customer, internal business perspectives, innovation and learning components improved strategic planning and evaluation. The other manager highlighted Rothaermel’s (2015) advantages and disadvantages of BSC for strategic implementation and formulation and its suggestion to employ a multiple stakeholder triple bottom line approach (TBL). They wondered if MIST had the resources to develop these more complex strategic evaluations.
MAJOR CHALLENGES AND DECISION FOCUS
In summary, MIST used a traditional strategic framework composed of stages (see Figure 1) to gauge past decisions and make future choices (Wheelen & Hunger, 2006; Hitt, et. al., 2009; David, 2009). Implementing this framework allowed MIST to establish and maintain profitability over the last two years, but Baagii and Buya thought it was time to visit the process again as so much had changed externally and within the company. Besides, they had a better understanding of the process after having progressed further in their business school education.
Baagii started at the top of the strategic framework model with the External Environment phase and thought about how much the market had changed and how rapidly it had continued to evolve. Even areas that had not changed, such as the strong country culture, needed analyzing as he believed this was one of the sources of their management and leadership challenges. CBSD projects continued to be acquired by MIST and their market share increased. This growing external market presence resulted in the firm’s internal core resources being allocated on a contract basis or to one-time projects with “ownership” belonging to the client. Baagii recognized that management’s growing emphasis on their own products over CBSD and SO projects had understandably caused internal conflicts as influence, roles and ownership became increasingly unequal. Strong organizational and task culture influences created management and leadership challenges. Furthermore, while talent acquisition was a tough process in Mongolia, the adoption of MIST values with new employees was even worse. Baagii wanted to integrate external and internal factors while addressing their vision now that he realized it was really a mission statement. Management felt that many of the issues were traditional growing pains of a start-up, but Baagii worried that not all start-ups survived. He hoped that insights from this process could help create a solid foundation for the company’s important next steps. They had over a month to complete these first three phases and they could use the key year-end meeting to develop and gain agreement on product strategy. Contract services’ large profitability that covered most organizational expenses and overall company growth needed to be put into perspective with the much larger opportunity of developing their own products. If MIST could not implement their strategy, then all the analysis and strategy formulation was a wasted effort.
The future was in their hands. They needed to address the inequities by focusing on internal factors such as leadership, task and organizational culture, engagement and talent management. As Baagii prepared a comparison of key metrics, he vowed to execute the final step of the strategic framework to improve the position the company for the coming months and years. MIST needed to improve their measurement processes beyond simple product line financial information (see Table 8), so management could more easily evaluate the results of their strategy implementation beyond the year-end 2012 meeting. Based on the strategic framework in Figure 1, what actions would you take if you were Baagii or Buya?
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Appendix 1. Overview of Mongolia
Country Culture Background
Mongolia was always a landlocked country in East and Central Asia. The Mongolian way of life started as nomadic, and although urbanization had developed rapidly since 1924, the tradition of the steppes lived on (see Table 10). Some industries had slowly developed as the country urbanized and the pace had quickened when private companies were allowed to develop in the 1990s. In 2012, Mongolia was home to 2.9 million people, shared borders with Russia and China, had three major cities, and remained mostly rural. The main industry was mining; specifically copper, gold, coal, silver and other natural resources. Ulaanbaatar was the capital and largest city with a population of approximately 1 million.
Table. 10. Traditions of the Steppes
Lifestyle The nomadic lifestyle completely differs from the settled way of life. “…The nomadic economy and nomadic art of life which are believed to have arisen from the geographic conditions, the peculiarity of Mongolian mentality…” This nomadic way of life under the hard climate has created the collectivist features of Mongolians. According to Sanduijav (2008), approximately 15 percent of the country’s 2.9 million people are engaged in nomadic pastoral livestock breeding. Despite this, the nomadic civilization continues still to shape Mongolians’ mentality.
Religion According to Sanduijav (2008), the Buddha teachings were deeply rooted in the minds of Mongolians as well as their way of living, customs and traditions. Although shamanism is the basic religion of Mongolians, they have been respecting Buddhism as a national religion. In Buddha, teachers do not tell things directly; they use philosophical, indirect approaches, which is very common in their society as well.
Masculinity For Mongolians, men were considered to be the inheritors or continuers of the family line, and they were respected highly as the “householders.” Additionally, the mobility and family-based culture was based on the ability of men to support the family in the rural areas. As a result, the society became male dominant. However, according to Sanduijav (2008), women played an important role in the history of Mongolians. Western scholars agreed that Mongolian women traditionally have had relatively higher social positions and greater autonomy than in the Islamic societies of Inner Asiaas well as China and Korea.
Unique characteristics Although Mongolia is located in Asia, it adopted several cultures including Asian, European and nomadic. Since the 20th century, European culture has had a strong influence via Russia and in 1924, it proclaimed itself as the communist Mongolian People’s Republic becoming one of the Soviet Union’s satellite states. These cultural mixes made Mongolians more westernized compared to other Asian countries, but with Asian and nomadic characteristics. Mongolians enjoyed a high capacity to adapt to new situations. There was more openness to new ideas and change. Management was not as official, and the uncertainty of structure and procedure was recognized. This was, likewise, the result of the nomadic civilization, and the society was considered to be comfortable with ambiguity.
Long-term oriented or short-term oriented The traditional thinking of accumulating material wealth was strongly characteristic of the Chinese; however the nomadic Mongolians did not develop this tradition of accumulating material wealth (Weatherford, 2005, p.143). According to Sanduijav (2008), Mongolian society was considered to be more short-term oriented.
Climate Influenced by natural and climatic-specific conditions, a production-mode of life made Mongolians very collectivistic within their family and relatives’ circle.
Hierarchy According to Sanduijav (2008), Mongolians had a strict tradition of respecting their elders and taking care of their parents as they aged. However, children regarded themselves as equal to their parents, students to their teachers, and employees to their leaders. Power was not distributed by such criteria as job seniority. On the contrary, the most capable person became a leader regardless of age or job seniority.
Source: Sanduijav (2008)
Mongolian Political System
The political system had a significant impact on the development of the new market-based economy and development of the Mongolian IT industry. Discover Mongolia (2013) indicated that when communism began to fall in the former Soviet Union, most Mongolians were not ready for the sudden change. A group of young professors and activists who were in charge of the government formed the Mongolian Democratic Union. They organized a hunger strike, which forced the resignation of the communist Mongolian People’s Revolutionary Party (MPRP). The MPRP agreed to the demands of the strikers and in the 1990 election, the MPRP received 60 percent of the vote. In 1991, Mongolia moved to a democratic, multiple party system and market economy.
Political Influence on Doing Business in Mongolia
Under the communist system in Mongolia, there was no domestic software development presence. The communist ministry that came closest to a market-based firm was the telecommunication ministry that included software development and it adapted technologies from Russia. Until recent years, software development verticals still belonged to the telecommunication ministry and accounted for one industry. In the ten years after 1990 when it became legal for individuals to own their own business, private businesses increased quickly. From 1998 to 2008, the total number of private businesses changed from 19,000 to 60,000. These businesses were in need of hardware and software solutions that could automate their intricate business needs.
Legal – New way of doing business in Mongolia
In order to legally start any private business (including software development) in the new market-based Mongolia economy, a person was required to be at least 18 years of age, and pay a 1,000,000 Mongolian Tugrik fee (which was equivalent to approximately 900.00 USD) to the government. Documentation (e.g, company rules, agreement between partners, order or agreement of the general director and bank account number) were required to become a legal private business. Once the company was approved by the government and issued a certificate, the firm was 100 percent private. In Mongolia, business taxes were paid to the government based on its industry. Telecommunication and software development industry tax rates were identical. According to the Top 100 Tax Payers of Mongolia (2011), the biggest telecommunication company paid approximately 4 million USD.
Environment & Legal
A New York Times article (Barringer, Feb 15, 2012) highlighted that Mongolia’s “mineral riches” could soon make it the world’s fastest growing economyalong with ruined landscapes and displaced herders. The potential environmental troubles on the open steppes where much of the mining activity was starting to occur, were mirrored by the country’s dwindling forests. The country’s supreme court ordered the government to enforce its 2009 environmental laws as a result of it failing to protect its watersheds and forests (Barringer, Feb 15, 2012).
A quote from the World Bank Quarterly economic update (World Bank, Oct 2012) stated: “The Mongolian economy is at the start of a huge expansion as it begins to develop its mineral wealth.” Mining construction lifted the Gross Domestic Product (GDP) above 17 percent and the the economy was growing in the double digits; yet, slower than the GDP. Economic risks included an uncertain global economic outlook, slower growth in China, high inflation, and payment risks.
Mongolia was considered the most sparsely populated sovereign country with a density of 5.19 people for every mile. Formal and informal unemployment reports, along with labor force surveys, indicated unemployment had dropped to a conservative 9 percent while nominal wages had increased 20 percent from the previous year. Purchasing power remained weak and finances tight with 60 percent of surveys saying earnings were insufficient to meet basic needs, even though they were 15 percent higher than the year before (World Bank, 2012).
Social indicators from the National Statistical Office of Mongolia (2012) for the first nine months of 2012 indicated that birth rates were up 6 percent, infant mortality was slightly down, and social welfare payments were up 6 percent. Crimes were up 11 percent, including crimes against right of ownership, human life and health, environmental protection rules, and traffic violations.
A New York Times article (Barringer, Feb 15, 2012) mentioned that herders had complained that they, along with their herds, were coughing because of the dust kicked up by the mining. They suggested herders may be negatively affected by the economic mining growth stated further that they would have to move soon.
Appendix 2. Four Work related Cultural Dimensions Survey
Power Distance (PDI)
1. Managers should make most decisions without consulting subordinates.
2. It is frequently necessary for a manager to use authority and power when dealing with subordinates
3. Managers should seldom ask for the opinions of employees.
4. Employees should not disagree with management decisions
5. Managers should not delegate important tasks to employees.
Uncertainty Avoidance (UAI)
1. It is important to have job requirements and instructions spelled out in detail so that employees always know what they are expected to do.
2. Managers expect workers to closely follow instructions and procedures
3. Rules and regularities are important because they inform workers what the organization expects of them.
4. Standard operating procedures are helpful to employees on the job.
5. Instructions for operations are important for employees on the job
1. Meetings are usually run more effectively when they are chaired by a man.
2. It is more important for men to have a professional career than it is for women to have a professional career
3. Men usually solve problems with logical analysis; women usually solve problems with intuition
4. Solving organizational problems usually requires an active, forcible approach which is typical of men
5. It is preferable to have a man in a high level position rather than a woman.
1. Group welfare is more important than individual rewards.
2. Group success is more important than individual success.
3. Being accepted by the members of your workgroup is very important
4. Employees should pursue their goals after considering the welfare of the group.
Source: Wu (2006)
Appendix 3. Company Employee Survey Summary
Questions Low 2 3 4 High N/A
Overall, how satisfied are you with the company 3 7 7
Overall, how satisfied are you with your department 6 9 2
I understand the long-term strategy 1 9 6 1
I have confidence in the leadership 1 3 5 8
I am given enough authority to make decisions I need to make 5 12
I like the type of work that I do 1 2 14
The company clearly conveys its mission to its employees 5 12
I believe my job is secure 1 2 14
Corporate communications are frequent enough 12 5
I feel I can trust what my company tells me 2 15
I believe there is a spirit of cooperation 7 10
My supervisor treats me fairly 10 7
My supervisor asks me for my input to help make decisions 4 11 2
Company provided as much initial training as I needed 3 14
My salary is fair for my responsibilities 5 12
Amount of vacation 2 10 5
Work interest 10 7
Future perspective at the company 2 10 5
I feel like I am a part of the company 2 15
I have tools and resources to do my job 5 12
I like the company environment 5 7 5
I believe in the current company culture 2 8 5 2
It is easy to get along with my colleagues 2 15
When I have questions, my supervisor is able to address them 2 8 3 4
Low 2 3 4 High N/A
TOTAL % based on scales: 2.58 14.32 34.51 47.42 1.17 2.58
Source: G. Baagii, personal communication, 2011
Appendix 4. Organizational Culture Exercise
Employees were asked to rate eight senior managers’ visions for the culture and their current culture on the topics listed in the format below.
No. Description Average
1 Role Clarity 5.75 5.75
2 Respect 6.00 6.00
3 Communication 6.50 5.13
4 Rewards 5.88 5.38
5 Career Development 5.88 6.25
6 Decisions on planning 5.88 5.50
7 Innovation 6.50 6.88
8 Positive work relationship 6.38 6.50
9 Teamwork and support 6.25 6.00
10 Quality of service 6.63 6.50
11 Conflict management 6.13 5.50
12 Morale and commitment 6.00 6.25
13 Training and learning 6.38 4.88
14 Direction 5.88 4.00
Source: MIST, 2013
Appendix 5. Top Management Background
Name Current Title
JoinMIST Founder Education
Prior Experience % Owner Location
2007 Yes BS Computer Science Software engineer 15 California
2007 Yes BS Computer Science Senior engineer 15 Mongolia
2008 Yes BS Computer Science Data base architect 10 Mongolia
Lam System Architect
2007 Yes Masters Computer Science Mgr. Desktop Applications 10 Mongolia
Cheny Mgr. of Web Development
2007 Yes BS Computer Science Senior Front-end Developer 10 Mongolia
Batmon Mgr. of Mobile Dept. 2007 Yes BS Computer Science Software engineer 10 Mongolia
Khurlee Nanzad CFO 2008 No BS Finance Engineering General accountant 0 Mongolia
Khatna Munkhbold Mgr. Marketing 2011 No MBA No management experience 0 Mongolia
Source: G. Baagii, personal communication, May 20, 2013. Note: The founders had approximately 1 ½ years of job experience each when they joined MIST.
Appendix 6. Additional MIST Financial Information
Table 11. MIST, Inc.’s income statements from 2007-2012 (NOTE: 2012 was an estimate)
Source: K. Nanzad, personal communication, June 26, 2014
Table 12. MIST, Inc’s balance sheet from 2007-2012 (NOTE: 2012 was an estimate)
Source: K. Nanzad, personal communication, June 26, 2014.
Table 13. MIST, Inc.’s cash flow statement from 2007-2012 (NOTE: 2012 was an estimate)
Source: K. Nanzad, personal communication, June 26, 2014
MIST Case Study
MIST, an innovative software development company was faced with various external factors influencing its growth and development. The Mongolian country culture and industry setting were the major external factors affecting the success of the company. The founders of MIST, Baagii and Buya were aware of how the county’s culture could influence the worker’s behaviors. The concept of cultural stereotypes minimized the opportunities available for professionals. However, the Mongolians believe in their cultural traditions created from the nomadic lifestyle. The mangers also discovered that lack of tolerance and ambition in MIST work environment. The country’s culture can be explained through the traditions that affected the performance of the workers in the company. The culture had some positive impacts on the performance of the company, as the Mongolian engineers with their high tolerance were able to meet the set deadlines.
On the other hand, the culture also led to the increased high employee turnover. One of the managers suggests that the workers were nomadic and thus, they preferred moving from one place to another. Also, the business processes were associated with cultural values that affected the organizational culture and the overall firm’s performance (Capon, 2009). According to the results of Hofstede model, it can be concluded that the national culture was influential in developing strong company culture. This shows that the company was culturally bound the company faced minimal competition due the low bargaining power of the companies. The main concerns for the company were to deal with the cultural values and beliefs of the Mongolians to enhance success.
Another significant external factor is the social factors. The managers of MIST should understand how the social factors affect the current technological businesses. Technology plays an important role in media enhancing globalization. MIST has an opportunity in utilizing the current virtual media. Other social factors include the transformation of people’s lives. The people in Mongolia can be expected to adopt the modern lifestyle.
Technological advancement is another external factor that affects the operations and performance MIST. After founding, the managers went to learn in United States in order to gain improved technological knowledge and concepts. The technological factors refer to both the ecological and environmental concepts that include automation, technological incentives and automation. The concepts affect the level of company’s productivity as well as influencing the outsourcing decisions. MIST would only outsource services that are expensive to produce internally. The dynamism of technological changes also affects the company’s pricing strategy, quality and innovation. As a result, MIST should understand the advancing technology to promote performance and success.
Apart from the technological factors, MIST also faces political factors. The political factors identify the level of government intervention on the operations of different businesses in Mongolia. The Mongolian government has implemented various taxation polices and tariffs to control the operations of the technological firms. Other political aspects that affect MIST include the labor laws, trade restrictions and the level of political stability. However, Mongolia enjoys a stable political environment offering a relevant climate for the growth of MIST. In most occasions, political interferences have significant impacts on the management of company. For instance, the recruitment of senior managers in the company could be politically instigated.
The legal factors are closely related to the political factors. However, MIST should note the specific legal factors including employment law and health and safety laws. The factors require the company to comply with all laws of the land to avoid illegal operations. Other factors include the environmental factors and economic factors (Capon, 2009). The managers should review the economic factors including interest rates and inflation rates among other factors as they affect the operation of business as influencing the decision-making. Therefore, the above external factors affect the operations of MIST in Mongolia.
Capon, C. (2009). Understanding the business environment. London, UK: Pearson Education, Limited.
BLE 214 Fall 2014
Exam 2 [Take-home Exam]
DUE IN CLASS 11/4/14
Answer all four (4) questions completely. Give a full explanation for your answers. Do not repeat the words of the question at the beginning of your answers. Each question is worth 25 points.
I. John Jacobs is a 17-year-old high school senior. Most of his friends on Facebook have expensive cars. Although he has never seen these cars, they must exist because his friends have posted pictures of them on Facebook. John believes everything he reads and sees on Facebook. John considers a new car to be a necessity.
He decides to ride his bicycle to the local Chevrolet dealer. Once there, he decides to buy a 2010 Corvette. The salesman is reluctant to sell the car to John until John says that his father will co-sign the loan. The salesman is still reluctant so he calls John’s father. John’s father refuses to co-sign the loan.
John convinces the salesman that he can make the payments without his father’s help. The dealer then agrees to sell the car to John, who signs a contract agreeing to buy the car and make 60 monthly payments. John also makes a $500 down payment.
John misses the first three monthly payments because he spends all his money on gas. Even worse, he challenges all takers to drag races and loses a fortune in bets. John decides to return the car to the dealer for a full refund. The car dealer refuses to take the car back and demands that John make the past-due payments and all future payments.
John then sues the car dealer for his $500 down payment, and asks the court to invalidate the contract.
The car dealer sues John for the 3 payments that John has missed.
What will be the outcome of each lawsuit? Fully explain your answer.
II. Jack and Jill are drug smugglers. They make monthly trips to Mexico to buy bulk quantities of drugs. They then load them in their truck’s false gas tank and drive them back to the U.S.
Their truck is getting old and they decide to buy a new one. However, the new truck does not come from the factory with a false gas tank in which to hide the drugs. Jack decides to bring the truck to the Mechanic’s auto repair garage to have a false gas tank installed.
When Jack arrives at the garage he makes the following request to the Mechanic: “I need a spare gas tank installed in my truck within 2 days. Don’t worry about connecting it to the engine because I never intend to fill it with gas, just drugs.”
The mechanic agrees to install the gas tank only if Jack agrees to sign a written contract. The mechanic writes the following contract: “Mechanic agrees to install a gas tank in Jack’s truck. Jack agrees never to use the truck for an illegal purpose and will pay Mechanic $1000 for the work.” Jack and the Mechanic both sign the contract. After the Mechanic installs the tank, Jack refuses to pay.
The Mechanic brings a lawsuit against Jack for breach of contract. Will he win? Fully explain your answer.
III. You are about to open a coffee shop in Boston. You have leased a building and purchased all the necessary equipment for the shop, including furniture for the customers. However, you must still arrange for bulk coffee to be delivered to your shop, which you will then brew and sell to your customers. You have interviewed several local suppliers, but have decided that Joe’s Coffee Supply has the best coffee at the best price.
You must now enter into a contract with Joe’s Coffee Supply. You recognize the importance of this contract to your business—without a reliable coffee supplier, your business will fail. You decide to write a contract that you will ask Joe’s Coffee Supply to sign.
For this question you are to draft a contract between your coffee shop and Joe’s Coffee Supply for the delivery of bulk coffee. The contract must contain eight to ten separate provisions that will best ensure the success of your business. You must also fully explain why those provisions are included in the contract.
IV. John Smith, a residence of Massachusetts, decides to open an account on Twitter after talking to his friends, all of whom agree that Twitter is great. John goes to the Twitter website, fills in all the requested information, and then clicks the box that says “I accept the terms of service.” John clicked that box without reading the terms of service.
After a few months, John is upset that some of his private information has been misused by Twitter. He decides he would like to bring a lawsuit against Twitter. Can John file his lawsuit in Massachusetts? Fully explain your answer.
The car dealer would be required to return $500 down payment to John. John Jacobs had no capacity to form a legally binding contract, since he was only 17 years old when he convinced the car dealer to sell the car to him. In most states, persons over the age of 18 years are assumed to have the full legal capacity to forms legally binding contracts. Contractual capacity can also be explained by the ability of persons to understand the rights and obligations of the contract. The persons should also show their ability to comply with terms of the contract. At some point, the salesman was not willing to sell the car without the father’s involvement. It was the right decision in order to involve a person with the legal capacity to form a legally binding contract.
After the salesman called his father, the father refused to co-sign the loan. The salesman would have been wise to avoid any further negotiations with John due to his age. John has the support of the contractual power of avoidance for minors. This is also known as disaffirmance. The rule gives the minors the rights to avoid the contract until they reach the age of majority. John was only three months to the contract when he 17 years old and thus, he the right to avoid the contract. In order to invalidate the contract, the minors are expected to demonstrate by word of mouth or show their intention. John went to the car dealer and expressed his desire to return the car, in which he had all the rights. The rule provides that even when the consideration is damaged, the other party have no recourse against the minor. The rule of dissaffirmance discourages parties from forming contracts with minors.
The mechanic is not likely to win the lawsuit against Jack. Before the writing the contract, the mechanic was informed the tank would be used for an illegal purpose to put drugs. The contract was not legally binding, as the tank was to be used an illegal activity. In addition, the contents of the contract are correct. The mechanic had written that Jack had agreed never to use the truck for illegal purpose in which was false. Since, Jack had never made any promises on how he will use his truck. The mechanic was liable of fraudulent misrepresentation in the entering into a contract with Jack and Jill. The mechanic was involved that the tank would be used in carrying drugs and still went ahead to sign the contract knowing the illegality of the material facts. Thus, he would be misleading the court that he was not aware of the intent of the Jack.
Any contracts formed for illegal purpose it is void and thus, unenforceable. As a result, the mechanic would face major difficulties in explaining the legality of the subject matter. The court usually interprets contractual rights and obligations depending on the intentions of parties as they formed the contract. Based on the case, it is clear that both Jack and mechanic were working together in committing crimes to facilitate the transportation of illegal drugs. In order to form a legally binding contract, it must be based on a legal purpose. The contract of installing a tank for ferrying drugs agreed with the mechanic and Jack was for an illegal purpose. Thus, the mechanic was not likely to win the lawsuit and the outcome would be both parties being jailed for engaging in illegal activities.
This supplier contract is made effective as from 1/11/2012 between Joe’s Coffee supply, and my coffee shop. The contract will stipulate the various provisions that will govern the delivery of bulk coffee. During the period of the supply contract, both parties will abide to the following provisions:
1. Items purchased. Joe’s coffee supply agrees to supply my coffee shop bulk coffee as follows
Description Quantity Unit Price Total Price
Bulk Coffee 100kgs @100 $10,000
The provisions dictate the price and quantity for the supply of bulk coffee within the agreed period. Most important, it minimizes any ambiguity and conflicts related to the supply of coffee such as the hiking of prices by the supplier.
2. Product standards. The coffee shall company with the quotation made and agreed up in the supply contract. The provisions ensure that only bulk coffee of the agreed quality and specifications is supplied in my coffee shop.
3. Title/Risk of Loss. Joe’s Coffee supply will assume all risks associated with the transportation of the bulk coffee to the coffee shop. The provisions clarify o the responsibility and accountability of the coffee in case it does not reach the coffee shop premises.
4. Payment. The payment shall be made to Joe’s Coffee supply, in the amount of $10,000 upon delivery of all the bulk coffee agreed. Payment discount provisions are 10% if the total bill is paid within two months. The provision explains the nature of payment as well as indicating any discount allowable for prompt payment by the buyer.
5. Delivery. Time is important in the articulation of the provisions of this contract. The supply will arrange for the delivery and it should be completed by 2nd March 2015. The provision minimizes cases of late delivery.
6. Payment of taxes. My coffee shop shall pay all taxes required by the federal, state and municipal states. The provision clearly outlines the persons liable for tax payment in the transaction.
7. Warranties. Joe’s coffee supply warrants that the bulk coffee shall be free from any defects in terms of quality and quantity. The provisions establish the party responsible for any special or incidental damages to the products.
8. Inspection. Upon receiving possession of the bulk coffee, the buyer shall inspect whether the products matches the supply contract requirements. The provision guides in avoiding future conflicts and the correction of non-conformity in the agreement.
However, twitter may act contrary to the policy when the disclosure of information is believed important in compliance with the laws and legal requirements. Such cases includes when addressing safety of people, fraud, security or in protecting twitter’s rights. Thus, twitter would be compelled the criteria of disclosing John Smith’s private information. If not, it would be liable for acting contrary to his private property. On the other hand, twitter terms of service on the tweets and lists argue that most of the information provided by users is asked to be made public. For example, the messages and other tweets posted by the users. John Smith should ascertain the privacy of the information misused by twitter. In misusing the private information of John Smith, Twitter had breached the contract signed with John Smith. As a result, John has some legal grounds to sue Twitter for the breach of the privacy provisions stipulated in the terms of the contract.
Personal Action Plan-Assessment
Total Points: 25 Points
This project is designed to reflect on your skills as a diversity leader through engaging in the Journey of
Self-Discovery activities and a personal identity assessment. After completing the activities and
assessment, you will create an action plan to improve your cultural competency.
Part One (10 points): In the past weeks you read Chapter 5 and learned about the Journey of SelfDiscovery, which involves various self-exploration activities developed from the Grubb Institute’s
Transforming Experiences Framework. As indicated in the book, “insights gained through the personal
journey provide a strong foundation for the development of cultural and linguistic competence in the
health professional, which is reflected in how we communicate with patients and colleagues and the
decisions we make in health care organizations” (pgs. 156-157). As part of this project, you will
complete self-discovery exercises to gain insight into your journey towards cultural competence. Pay
attention to your communication habits and personal attitudes as you complete these exercises.
Choose two of the following activities of your choice outlined in Chapter Five (pages 156-165): (1) Group
Identity Circle; (2) LifeLine Graph; (3) Images in the Media; (4) Thinking About Multiple Dimensions of
Diversity; or (5)The Power of Observation. Proceed with the activity by answering the questions in the
text book that accompany that section. For example, if you choose images in the media (pg. 162),
briefly answer the questions in paragraph 2 and 3 (pg. 162) under “images in the media.”
Part Two (15 points):
a. Proceed to “Role: How do I want to operate? (Pg.165). Write a 2-3 page narrative of what you
learned about your strengths and areas for development as a culturally competent health care
professional. What actions can you take to improve your performance?
b. Create an action plan using the template from Chapter 5 (Table 5.1: Journey of SelfDiscovery: Action
Plan). You may create an Action Plan table and put it in the paper you will turn in for this project. Make
sure the table has the same columns and sections as Table 5.1. Be sure to put in more detail than the
example in the chapter. Use the four columns provided in the template and add between 3-5 bullet
points under each column.
Dreachslin, J. L., Gilbert, M. J., & Malone, B. (2013). Diversity and cultural competence in health care: A systems approach. John Wiley & Sons. ISBN 978-1-1180-6560-0, 464 pages.
Personal Action Plan-Assessment Total Points: 25 Points This project is designed to reflect on your skills as a diversity leader through engaging in the Journey of Self-Discovery activities and a personal identity assessment. After completing the activities and assessment, you will create an action plan to improve your cultural competency.
Part One (10 points): In the past weeks you read Chapter 5 and learned about the Journey of SelfDiscovery, which involves various self-exploration activities developed from the Grubb Institute’s Transforming Experiences Framework. As indicated in the book, “insights gained through the personal journey provide a strong foundation for the development of cultural and linguistic competence in the health professional, which is reflected in how we communicate with patients and colleagues and the decisions we make in health care organizations” (pgs. 156-157). As part of this project, you will complete self-discovery exercises to gain insight into your journey towards cultural competence. Pay attention to your communication habits and personal attitudes as you complete these exercises. Choose two of the following activities of your choice outlined in Chapter Five (pages 156-165): (1) Group Identity Circle; (2) LifeLine Graph; (3) Images in the Media; (4) Thinking About Multiple Dimensions of Diversity; or (5)The Power of Observation. Proceed with the activity by answering the questions in the text book that accompany that section. For example, if you choose images in the media (pg. 162), briefly answer the questions in paragraph 2 and 3 (pg. 162) under “images in the media.”
Part Two (15 points): a. Proceed to “Role: How do I want to operate? (Pg.165). Write a 2-3 page narrative of what you learned about your strengths and areas for development as a culturally competent health care professional. What actions can you take to improve your performance? b. Create an action plan using the template from Chapter 5 (Table 5.1: Journey of SelfDiscovery: Action Plan). You may create an Action Plan table and put it in the paper you will turn in for this project. Make sure the table has the same columns and sections as Table 5.1. Be sure to put in more detail than the example in the chapter. Use the four columns provided in the template and add between 3-5 bullet points under each column
Direct home discharge and likelihood of 30-day hospital readmission after Transcatheter Aortic Valve Replacement(TAVFR)
Dodson, J. A., Williams, M., Vemulapalli, S., Manandhar, P., Cohen, D., Blaum, C., . . . Hochman, J. (2017). Direct home discharge and likelihood of 30-day hospital readmission after Transcatheter Aortic Valve(TAVR): Findings from the STS/ACC TVT registry. Journal of the American College of Cardiology, 69(11), 1233. doi:http://dx.doi.org.contentproxy.phoenix.edu/10.1016/S0735-1097(17)34622-3
Transcatheter aortic valve replacement(TAVR) is a therapy for patients with symptomatic severe aortic stenosis at high operative risk. The patients undergo TAVR are elderly with a high degree of comorbid disease. These factors place patients at high risk for subsequent acute care utilization. According to this study,17%, one of six patients readmitted to the hospital within 30 days of TAVR, and over half of them readmitted within one year. The study compared between discharge disposition: direct home versus skilled nursing facility(SNG) and 30‐day readmission rates based on the case mix of patients discharged to home versus SNF. The purpose of this research is to see if these methods are helpful in these patients. Because hospital readmissions are costly and can adversely impact patients’ quality of like could potentially be preventable readmission. The study shows that the early post discharge is not a great idea especially when the time for the patients’ needs physical deconditioning, altered medication regimes and poor nutrition. The study shows how both post discharge ways could benefit/ or not benefit the patient. The data concerning that their benefits are mixed. The methods used in the study is the national Society of Thoracic Surgeons/American College of Cardiology (STS/ACC) transcatheter valve therapy (TVT) Registry to investigate variations in discharge practices, patient‐ and hospital‐level characteristics associated with discharge to home versus SNF, and 30‐day readmission rates based on case mix of patients discharged to home versus SNF. From the results or a thirty‐day readmission rates by quartile of direct home discharge, they identified 18,956 patients from 329 U.S hospitals median age 84 years. Overall, 69% of patients discharged directly home. The characteristics from the table show the median 30-day readmission rate was 18%(the Interquartile Range (IQR 13%-22%).There was no significant difference in 30‐day readmissions among quartiles (P=0.14). The finding did not change with risk adjustment. There were other factors most greatly associated with the 30-day readmission were procedural details: glomerular filtration rate, in-hospital stroke, and transient ischemic attack. The research findings suggest that the hospital practice of direct home discharge post-TAVR does not discuss excessive readmission risk. Further research is needed to understand the variation in the practice and strategy to advance care.
Readmissions after hospitalization for acute myocardial infarction (AMI) are common. However, the few currently
available AMI readmission risk prediction models have poor-to-modest predictive ability and are not readily actionable in real time.
We sought to develop an actionable and accurate AMI readmission risk prediction model to identify high-risk patients as early as
possible during hospitalization.
Readmissions after hospitalization for acute myocardial infarction (AMI) are common. However, the few currently
available AMI readmission risk prediction models have poor-to-modest predictive ability and are not readily actionable in real time.
We sought to develop an actionable and accurate AMI readmission risk prediction model to identify high-risk patients as early as
possible during hospitalization.
Improving Heart Failure Readmission Costs and Outcomes with a Hospital-to-Home Readmission Intervention Program.
Mazimba, S. (18, July 19). Improving Heart Failure Readmission Costs and Outcomes With a Hospital-to-Home Readmission Intervention Program. Retrieved January 24, 19, from https://journals-sagepub-com.contentproxy.phoenix.edu/doi/10.1177/1062860618788436#articleCitationDownloadContainer
This Hospital-to-Home (H2H) program is a rapid clinic follow-up program study performed for patients with recent Heart Failure(HF) admitted at the University of Virginia Health System. Since heart failure is one of the leading cause of admissions in patients older than 65, also the costs for care and some costs are related to hospital readmissions. With the increasing costs or admission/readmission in outpatient, HF patients also associated with an increase in mortality. This research purpose is to reduce health care costs and reduce HF readmissions by working with the institutions in advocating for early post-discharge follow-up. The problem of HF readmissions has been led the Centers for Medicare and Medicaid Services to introduce financial penalties against hospitals with an excess of 30-day readmission rates. The H2H advantage hospitals to perform a post-discharge follow-up appointment within one week of discharge to reduce HF readmissions. This study also evaluates the impact of the H2H-modeled program on mortality, readmission days, and readmission costs at an academic medical center. This study purpose is to determine whether the H2H program has an impact on the HF-related measures and consequences. The patient cohort was patients who are 18 years and up admitted to the University of Virginia Health System between Jan 1, 2011, and December 31, 2014, with a diagnosis of HF. The H2H program was designed as a rapid follow up clinic by the (Nurse practitioners) NPs, for the patients discharged from the hospital with a diagnostic of HF and live 90 miles away of the University. The HF readmission costs, Data on demographic and comorbid conditions obtained from the University of Virginia Health System Clinical Data Repository(CDR). The vitals, lab results, medications (at the time of discharge) and other important information collected from the electronic medical record(EPIC) systems. This study observed that H2H participation linked with a statistically significant reduction in 30-day mortality after the index hospitalization, a 24% reduction in readmission days within 30 days of the index hospitalization, and 39% reduction in readmission costs within 30 days of the index hospitalization. Also, a reduction in 30-day mortality in the H2H cohort versus usual care was 1.84 %: 3.13%. Though there was some limitation to the study, first the H2H enrollment is based on a referral from inpatient care teams, could be potential for referral bias. Second, the studies team could not account for patients referred to the H2H program who did not show up for follow up. It was also difficult to account for all HF readmissions, mostly those readmissions to different institutions.
Hospital performance measures and 30-day readmission rates
Stefan, M. S., Pekow, P. S., Nsa, W., Priya, A., Miller, L. E., Bratzler, D. W., . . . Lindenauer, P. K. (2013). Hospital performance measures and 30-day readmission rates. Journal of General Internal Medicine, 28(3), 377-85. doi:http://dx.doi.org.contentproxy.phoenix.edu/10.1007/s11606-012-2229-8
This article focuses on lowering readmission after hospitalization for (Acute myocardial infarction) AMI, (Congestive Heart Failure) CHF, and pneumonia. Even though readmission of these ailments in acute care hospitals are common, the study evaluates whether the passage of Hospital Readmission Reduction Program(HRRP) was followed by acceleration in improvement in 30-day Risk-Standardized Readmission Rates(RSRRs) after hospitalization for AMI, CHF, and pneumonia. Also, it assesses whether the lowest performing hospitals had faster improvement after the passage of the law than the hospitals that were already performing well. The research used a cross-sectional analysis, they analyze the data from a representative subset, they used to discharge and quality of care assessment records that were submitted by the hospital that participated in Hospital Inpatient Quality Reporting(IQR) program. The demographics used was Patients who are 66 years or older, received a principal discharge diagnosis of AMI, CHF or pneumonia were discharged from an acute care hospital that reported data to the Hospital IQR program. The main aim of this research was for those hospitals with the highest risk-standardized readmission rates (RSRRs), to be able to experience the greatest improvement after HRRP. The objective of this research evaluates whether the passage of HRRP was followed by the lowest performing hospitals. They use the measurement:30-day readmission rates after hospitalization for AMI, CHF, or pneumonia for hospitals in the highest performance which is 0% penalty, for the average performance 0% to 0.50% penalty and the low performing once 0.50 to 0.99% penalty. Anything below that would be more than 0.99 percent penalty. The article though didn’t differentiate if the improvement was caused by the magnitude of the penalty or by the health promotion or levels of health improvement in different patient populations. In spite of this, the article provides useful background information on the topic and came up with good results that after the passage, readmission rates reduce and improvements were noticed for the hospitals with the lowest prelaw performance.
This assignment is Annotated Bibliography, this annotated bibliography includes references formatted according to APA standards. This is a list of references to books, articles, webpages and other sources (in my case I have 3 references) The reference listed first and is followed by a brief summary, or annotation of the source. The annotation informs the reader of the relevance and quality of the source.
This one is different and separate assignment
Professional and Ethical Topics (Paper 1)
This assignment is due in Week 3.
60 Percent Points Available
60 Points Earned
X/60 Additional Comments:
In this paper, the student explains how ethical issues in public life, business, and society can change over time.
20 Percent Points Available
20 Points Earned
X/20 Additional Comments:
• The paper is 500 to 650 words long. Include an introduction, current status, and conclusion. Explain the ethical issues related to your topic.
• The conclusion is logical, flows, and reviews the major points.
• Describe your topic, including current research, news, and information.
• Recommend at least two strategies professionals in organizations could use to be more socially responsible for trying to correct any legal and/or ethical issues related to the topic.
– Provide a brief description of each strategy.
• Select one of the strategies discussed and explain why it is the best strategy to use for the topic you selected.
• Cite at least 3 scholarly, reputable references used to create your paper. One reference must be your textbook. Reputable references include trade or industry publications, government or agency websites, scholarly works, journal articles, or other sources of similar quality.
20 Percent Points Available
20 Points Earned
X/20 Additional Comments:
• The paper, including tables and graphs, headings, title page, and reference page, is formatted according to APA guidelines and meets requirements.
• Intellectual property is recognized with in-text citations and a reference page.
• The paper effectively uses headings, font styles, and white space.
• Rules of grammar, usage, and punctuation are followed; spelling is correct.
Total Available Total Earned
Professional and Ethical Topics:
Ethical issues in the United States (U. S.) and society can change over time. As a potential business owner and professional, it is important to understand and take action to address current public and ethical issues from a well-researched perspective. This assignment gives you the opportunity to research a current “hot button issue” of your interest and recommend ethical and socially responsible actions.
Write a 500- to 650-word paper that discusses one of the ethical issues below. Use the headings and/or subheadings below for clarity to ensure that you have covered all required points in the paper. Your paper should:
• Include an introduction, current status, and conclusion.
• Describe your topic, including current research, news, and information.
• Explain the ethical issues related to your topic.
• Explain any human subject protections related to your topic (if any).
• Recommend at least two strategies professionals in organizations could use to be more socially responsible for trying to correct any legal and/or ethical issues related to the topic.
o Provide a brief description of each strategy.
• Select one of the strategies discussed and explain why it is the best strategy for professionals to use in reference to the topic you selected.
Select one of the current public or professional topics below:
• Protection of the U. S. Border
• Torture and Terrorists: A Moral Predicament
• Family Separation at the U. S. Southern Border
• Medicaid in Texas Communities
• Corporate Welfare Across the U. S.
• Legalizing Medical and Recreational Use of Marijuana
• Mandatory Child Immunizations
• Health Care: A Right or a Privilege
• The Grocery Gap, Food Deserts, and Obesity
• Mental Health and Suicide Prevention
• Caring for an Aging Population
• An Ethical View of Gun Control
Cite 3 scholarly, reputable references used to create your paper. One reference must be your textbook. Reputable references include trade or industry publications, government or agency websites, scholarly works, journal articles, or other sources of similar quality.
Format your paper according to APA guidelines.
Does incentive work in motivating employees in a high -stress work environment?
NO,the incentive theory will always motivate the employees even in a stressful environment but it will only last if the motivations and conditions can satisfy the employee.
The incentive theory suggest that behaviour is motivated by desire for for reinforcement or incentive.Therefore ,the internal environment of the employee should be considered in that it should be conducive hence enhancing reinforcement.when the employee is working on stressed environment despite the motivations he or she would always be inactive .
The major factors motivating employees in their work are the : the intrinsic motivation and the extrinsic motivation.
This is the behaviour that is driven internally towards the internal rewards.it also involves self interest and exists within the individual.Therefore when the external environment of the work is under high-stress the efforts at fostering the intrinsic motivation can be slow to affect behaviour despite the interest and self determination of the employee.The primary underlying problems facing the employee should be considered hence incentive motivation will work.
This is the behaviour that is driven by external rewards such as money,fame,grades praises and job promotion.
Despite the high motivations given to the employee and the the working environment is high-stressed ,he or she will always be inactive in the work.The incentives may be high but it will only last if the rewards are satisfying in which in high-stress working environment satisfaction will not be achieved.In high-stress work environment the employee will always face challenges when working towards achieving the goals hence incentive motivation will not work.
Ryan,Richard M;Deci,Edward L..”intrinsic and Extrinsic Motivations:Classic Definitions and New Directions”.Contemporary Educational Psychology.25:54-67
2.N Root ,George.” Examples of Intrinsic Work place Motivation”Chron Retrieved 27 November 2014.