As one of the reporter of case 7 (The New Market Opportunity). Our group discussed different point of view about the case, but to sum up the main problem of the case, it is about economic growth and environmental sustainability.
To give the background about the case, in 1994, Chinese government invited leading international automobile companies to submit plans for a car that is designed for the growing Chinese population for the economic boom. The Chinese government has specified that the car should be less than $5000, big enough to fit a small family with one child, rugged, and using parts made from China, however environmentalists are worried with the effects of having car manufacturer’s response to the call of the Chinese government.
One, even if the car would be environmentally friendly, there still a negative impact in the environment because of the cumulative environmental effect. Then, even if automobile companies will propose an electric car, China will consume more natural resources that will cause greater harm in the environment. Lastly, it will increase the prices of oil in which US is one of the top users, and will deplete the supply of oil in which new sources of oil must be discovered. The possible negotiations of China in Middle East countries to trade weapon for oil the will cause a risk of war, also the chances of intervening of United States, as one of the super power nation in the world, it is the duty of US to protect its welfare and the world from any possible chaos or destruction due to lack of oil supply and increasing oil prices.
Analyzing the problem, we came up with the decision that we should take the point of view of international car companies. Our statement of the problem was, what action should the international car companies take in response to the invitation of China?
Here are the three Alternative Courses of Action the group have agreed on:
- ACA 1 – The International car companies will not participate in submitting a proposal to China
- ACA 2 – The International car companies will submit a proposal to China for an alternative mass transportation
- ACA 3 – The International car companies will submit an intent to form a joint venture but will suggest a collaborative research and development for eco-friendly cars
The objectives of our group is to be able to identify a solution for reducing the negative impact of cars in the environment, and also to come up with a proposal that will follow strict regulation in the environment. Using the merkulla framework, ACA 2 got the highest score. And I think this course of action was fair for all stakeholders and environment. I have learned that public/ mass transportation emit less pollution, and that would help to reduce the negative impact in the environment.
It is difficult to decide if we were still be proposing a plans in China because if we were going to focus on economic growth, automobile accompanies will definitely submit, but we realized that it is possible to sustain profitability and sustaining environment as well as reducing the emission of pollution by proposing Mass Transportation.
While doing the case, I realized how important to take care of the environment, because it will affect many aspects of our lives, and we should always protect the environment. In any business, the sustainability of profit, people and planet are important. Now, I am more sensitive in terms of using the energy in day to day activities to live in a clean environment. We should never compromise the environment just to earn and gain profit.