Business Studies

Apply: Signature Assignment: Globalization and Information Research

 

Assignment Content

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Purpose 

This assignment is intended to give you an opportunity to strengthen your skills in gathering and analyzing business-related information. It provides a deeper understanding of how companies can look at globalization as part of their strategic and operational plans. The assignment has two parts: one focused on information research and analysis, and the other is on applied analytics.

 

Resources: 

1. • Microsoft Excel®
   • “How Netflix Expanded to 190 Countries in 7 Years” from Harvard Business Review
   • Call Center Waiting Time

 

Part 1: Globalization and Information Research

Context: Companies that perform well in their country of origin usually consider expanding operations in new international markets. Deciding where, how, and when to expand is not an easy task, though.

 

Many issues need to be considered before crafting an expansion strategy and investing significant resources to this end, including:

1. • the level of demand to be expected for the company’s products/services
   • presence of local competitors
   • the regulatory, economic, demographic, and political environments

 

Carefully researching and analyzing these and other factors can help mitigate the inherent risk associated with an overseas expansion strategy, thus increasing the likelihood of success.

 

As a data analyst in your company’s business development department, you’ve been tasked with the responsibility of recommending countries for international expansion. You’ll write a report to the company’s executive team with your research, analysis, and recommendations.

 

Instructions: 

Write a 525-word summary covering the following items:

1. • According to the article listed above, what were the most important strategic moves that propelled Netflix’s successful international expansion?
   • The article mentions investments in big data and analytics as one of the elements accompanying the second phase of overseas expansion. Why was this investment important? What type of information did Netflix derive from the data collected?
   • According to the article, what is exponential globalization?
   • Not all international expansion strategies are a resounding success, however. Research an article or video that discusses an instance in which an American company’s expansion efforts in another country failed. According to the article/video you selected, what were the main reasons for this failure? Do you agree with this assessment?
   • Explain some of the reasons why certain companies’ expansion plans have failed in the past.

 

Part 2: Hypothesis testing 

Context: Your organization is evaluating the quality of its call center operations. One of the most important metrics in a call center is Time in Queue (TiQ), which is the time a customer has to wait before he/she is serviced by a Customer Service Representative (CSR). If a customer has to wait for too long, he/she is more likely to get discouraged and hang up. Furthermore, customers who have to wait too long in the queue typically report a negative overall experience with the call. You’ve conducted an exhaustive literature review and found that the average TiQ in your industry is 2.5 minutes (150 seconds).

 

Another important metric is Service Time (ST), also known as Handle Time, which is the time a CSR spends servicing the customer. CSR’s with more experience and deeper knowledge tend to resolve customer calls faster. Companies can improve average ST by providing more training to their CSR’s or even by channeling calls according to area of expertise. Last month your company had an average ST of approximately 3.5 minutes (210 seconds). In an effort to improve this metric, the company has implemented a new protocol that channels calls to CSR’s based on area of expertise. The new protocol (PE) is being tested side-by-side with the traditional (PT) protocol.

 

Instructions:

Access the Call Center Waiting Time file. Each row in the database corresponds to a different call. The column variables are as follows:

1. • ProtocolType: indicates protocol type, either PT or PE
   • QueueTime: Time in Queue, in seconds
   • ServiceTime: Service Time, in seconds
   • Perform a test of hypothesis to determine whether the average TiQ is lower than the industry standard of 2.5 minutes (150 seconds). Use a significance level of α=0.05.
   • Evaluate if the company should allocate more resources to improve its average TiQ.
   • Perform a test of hypothesis to determine whether the average ST with service protocol PE is lower than with the PT protocol. Use a significance level of α=0.05.
   • Assess if the new protocol served its purpose. (Hint: this should be a test of means for 2 independent groups.)
   • Submit your calculations and a 175-word summary of your conclusions.

 

Submit your assignment.

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ANSWER

 

Analyzing Business-Related Information

Part 1: Globalization and Information Research

According to the article listed above, what were the most important strategic moves that propelled Netflix’s successful international expansion? 

Netflix, in its expansion strategy, was careful in entering the international market. It did not enter all the markets at the same time, but began with those that were closer to its local market. It then expanded into further markets, ensuring that it incorporated the technical, political, regulatory, cultural, competitor, institutional and customer differences across markets. This was accompanied by producing content that was suitable for local-for-local as well as local-for global viewing. In these markets, Netflix was able to partner with key stakeholders to incorporate Netflix’s content into their business, such as Vodafone’s TV service installing the Netflix button on remote controls in Ireland.

The article mentions investments in big data and analytics as one of the elements accompanying the second phase of overseas expansion. Why was this investment important? What type of information did Netflix derive from the data collected? 

Investing in big data and analytics was an important factor in the expansion of the company. It was a necessary investment for Netflix at this phase as the company was expanding faster to more markets, thus significantly expanding its customer base. This enabled Netflix to obtain information about varied customer preferences in various geographical areas, effective marketing strategies that customers respond to and how to organize the company for greater success.

According to the article, what is exponential globalization? 

By and large, the elements of the approach that Netflix used in its expansion strategy are called exponential globalization. It involves careful expansion to more customers and countries through a well-organized cycle carried out at an increasing pace.

Not all international expansion strategies are a resounding success, however. Research an article or video that discusses an instance in which an American company’s expansion efforts in another country failed. According to the article/video you selected, what were the main reasons for this failure? Do you agree with this assessment? 

Walmart, an American-founded business, is a discount retailer reaching out to several countries in the world. It has done well in several countries so far such as the UK, South Africa, Mexico, Nigeria, Brazil, China, and India. However, its entry into the German market was a big failure. For almost ten years, it tried to gain the loyalty of customers in Germany but failed terribly (Yoder, Visich & Rustambekov, 2016). First of all, the German market is characterized by very low prices of groceries, and this made it very difficult for Walmart to compete with the local retailers. They also brought the ‘smiling culture’ of the Americans into the German Walmart stores, which was not natural to the Germans. Most of the customers did not prefer Sam Walton products, which formed the larger amount of stock in Walmart. I agree with this assessment and observe that companies’ internationalization strategy should be keen on the unique culture of the target market.

Explain some of the reasons why certain companies’ expansion plans have failed in the past. 

An assessment of Walmart Germany, Tim Hortons USA, Best Buy China and Tesco USA highlights several common reasons as to why internationalization strategies of companies have failed (Yoder, Visich & Rustambekov, 2016). The location of the business in the target market is one of the reasons. For countries that mainly use public transport, these companies opened stores in unfavorable locations for customers using public transport for example the location of Walmart Germany’s stores in Interspar and Wertkauf. The culture of the people has been another reason for failed internationalization. For example, Americans prefer a store that stocks a variety of their required products so that they can purchase everything at once, yet Tesco opened small stores with only few products that were also inappropriate for American consumers. The prices of products also affect expansion strategies. For example, Best Buy products were expensive for Chinese customers as they were used to counterfeit items that were sold at cheaper prices. This led to a difficulty of expansion of Best Buy in China.

Part 2: Hypothesis testing

Table 1: Important data

	SERVICE TIME (ST)		TIME IN QUEUE (TiQ)
	PT	PE	PT & PE
Population size (n)	821	853	1674
Average (X)	212.16	149.28	147.92
Standard deviation (s)	190.58	185.89	137.94

 

Perform a test of hypothesis to determine whether the average TiQ is lower than the industry standard of 2.5 minutes (150 seconds). Use a significance level of α=0.05.  

Null hypothesis: H₀: µ=150

Alternative hypothesis: H₁: µ<150

Significance level: α=0.05

Z-score: z=-1.645. This is a one-tailed test. Thus, if z≤-1.645, we reject the null hypothesis.

Test statistic:  = -0.617

-0.617 > -1.645

P-value = 0.269, meaning that the result is not significant at 0.05 significance level.

Thus, we do not reject the null hypothesis H₀.

This shows that the average TiQ is not significantly lower than the industry standard.

Perform a test of hypothesis to determine whether the average ST with service protocol PE is lower than with the PT protocol. Use a significance level of α=0.05.

Null hypothesis: H0: µ=210

Alternative hypothesis: H1: µ<210

Significance level: α=0.05

Z-score: z=-1.645. This is a one-tailed test. Thus, if z≤-1.645, we reject the null hypothesis.

Test statistic:  = -9.54

-9.54 < -1.645

P-value = 0.00001, meaning that the result is significant at 0.05 significance level.

Thus, we reject the null hypothesis H0.

This shows that the average ST with protocol PE is significantly lower than with protocol PT.

Assess if the new protocol served its purpose. (Hint: this should be a test of means for 2 independent groups.) 

The hypotheses: H0: µ1= µ2

H1: µ1≠ µ2

Significance level: α=0.05

Z-score: z=1.960. This is a two-tailed test. Thus, if z≤-1.960 or z≥1.960, we reject the null hypothesis.

The ratio of the sample variances is:  , which means that the equality of population variances is reasonable.

Test statistic:  and

6.834>1.960

P-value = 0.00001, meaning that the result is significant at 0.05 significance level.

Thus, we reject the null hypothesis H0.

This shows that the new protocol served its purpose of reducing the service time.

Conclusion

The company seems to be doing well as compared to the industry. Its average Time in Queue (TiQ) is not significantly different from the industry average. However, for it to gain a competitive advantage over its rivals in the industry, it would be reasonable for it to allocate more resources in the form of labor so as to reduce its average TiQ and be propelled to an above average position. Allocating more resources would mean that there will be more Customer Service Representatives (CSRs) to serve the customers, thus more customers will be served at a time. This will improve the reports given by customers as more calls will be rated as a positive overall experience. The new protocol PE also seems to be performing as intended by the company. It has significantly reduced the amount of service time. It has, indeed, served its purpose and the company should consider fully replacing the traditional protocol PT with PE. More training of CSRs and diverting calls to them based on area of expertise would help to improve further on the service time.

 

 

References

Yoder, S., Visich, J. K., & Rustambekov, E. (2016). Lessons learned from international    expansion failures and successes. Business Horizons, 59(2), 233-243.