Introduction
Business companies can have a significant impact on societies. This is especially true when they intend to make significant investments in a particular area. These investments will certainly have an important impact on the surrounding environment (Gomez-Mejia et al., 2008). Thus, they will impact the communities living in that environment. This impact could be either positive or negative. And it can be positive or negative for both, the community, society, and the company. This is the case of the company we are discussing here.
Company’s mission
This company has as its mission to offer ethical and the best moral business practices possible to a community or a society. Of course, being a business, the company does not forget that it aims to increase its profits but it wishes to do this by pursuing the best way for both, the company and the community, for them to benefit the most from this business culture.
Problem and forces involved in the case
The company Alex and Nik are working for desires to increase its presence in Kava. That is the basic premise that the analysis should start. They also want to invest the best they can in order not just to retrieve, get back, the most but also to impact the place in such a way that will transform its social and economic environment radically. The primary problems facing this investment decision-making are the perils associated with it. The first perils are the ‘natural ones’ that affect the island of Kava frequently. These include tidal waves, tsunamis, tornadoes, floods, fires, volcanic eruptions, earthquakes, or petroleum spills. These are factors the company cannot do anything to prevent them or to deviate their course. These are factors, or forces, to be considered if there is to be a significant investment to design adequate measures of the response of such events.
But there exist even other ‘social forces’ that the company has to deal with. These include a mixture of social groups and beliefs that have their ideas and system of viewing the world, a spreading disease problem (that of HIV/AIDS). The other two major forces would be the high risk for avian flu and terrorism which could come both from within or from outside the country.
The thesis of this report is that the company could manage to design reactive measures to the natural forces involved in the country but also could design strategies to positively impact the social environment. By doing this it will change the social formation of the country by turning it into a partner and thus favoring future investments.
Stakeholder’s analysis
Nevertheless, there are several reasons for the company to increase its presence in the region and expand its investment portfolio. We should start from the economic ones and then add to them the social ones.
The facts presented by Alex to Nik show that kava is rich in, at least, two of the most basic factors impacting an economy: labor and natural resources. One of the existing facts of its economy is that it offers inexpensive but still quality labor to the market. Another important factor is that the island of Kava is rich in natural resources. It has resources of petroleum, coffee, cocoa, spices, bananas, sugar, fishing, and natural gas. We should not forget the fact that it is a tropical island with a beautiful coastline which makes tourism a great future potential investment. To this, we should add the fact that more than 50% of the population of the island has less than 15 years of age. This means that the demand for labor in the future is expected to grow significantly. The high demand for labor and its future increase make a place interesting to companies (Taylor, 2006).
Our company would find itself in a rich environment of capital, both human and non-human, which needs only to be properly administrated and managed. From our point of view, the contrast between the positive aspects just mentioned and those ‘negative forces’ mentioned earlier makes the company hesitate in an immediate investment. This was the view of the first stakeholder, namely our company.
The second group of stakeholders would be the government of the country. They are well aware of the potential they got in terms of labor and natural resources offer. They are also ‘stuck’ with the various social problems between different groups composing the society. Having a multi groups society many times turns to be a problem in terms of attracting businesses (Gomez-Mejia et al., 2008). Thus, their interest is that our company increases its presence and sets the ‘example’ for others in order to positively impact society and diminish its problems.
A third stakeholder group would be the different social groups of society and the individuals composing them. They recognize that better economic conditions would reduce their internal problems and make ‘their life easier’. At the same time, they are concerned that this economic development be equal in opportunities for all social groups and not favor one particular group and disfavor another. The final consideration is that the companies intending to invest (in this case our company) should not do this in opposition to their system of beliefs, viewpoint of the world.
Conclusion
So, Nik and Alex find themselves in a rally interesting dilemma. From the above analysis we can understand that the risk of investment is high in this island. On the other hand, we also understand that the possibilities of success and the final gain can be greater than what expected. But since, as Alex mentioned, the founder of the company prided himself and the company for its business courage and ethical conduct, than it would be best if the company carries on with the plan of implementing significant investments in this island. This should be done taking into consideration a few recommendations.
Recommendations
Taking into consideration the above mentioned ‘problems’ would be easy to come at the ‘speedy conclusion’ of ‘forget it!’ that Nik came. Nevertheless, the company should not let this opportunity pass away. Since there is plenty of ‘material’ to work with both physically and, more important, socially, it is best that the company transfers some of its best human assets to this island in order to try and implement a ‘work culture’. The fact that more than 50% of the population is young makes them ‘thirsty’ and in need of professional training.
The company could conduct several trainings of the labor force and use the ‘final product’ of these trainings of the young in its favor in the future. Another recommendation would be to select the place of investment carefully in order to avoid the maximum possible the damaging effects of the natural forces affecting the island. With these recommendations I believe our company would benefit from this investment but the country also would greatly benefit from it.
References
Gomez-Mejia, Luis R.; David B. Balkin and Robert L. Cardy. (2008). Management: People, Performance, Change, 3rd edition. New York: McGraw-Hill.
Taylor, Walter. (2006). Introduction to Management, 9th edition. Prentice Hall: New Jersey.