Pros and Cons of Horizontal Integration

 Horizontal integration is the process of a company increasing production of goods or services at the same part of the supply chain. A company may do this via internal expansion, acquisition or merger. The process can lead to monopoly if a company captures the vast majority of the market for that product or service.

According to Investopedia, while there can be many benefits to horizontal integration, the most obvious benefit is an increased market share for the company. When two companies combine, they also combine their products, technology, and the services that they provide to the market. And when one company multiplies its products, it can also increase its consumer foothold. Along those same lines, companies can benefit from a larger customer base after horizontal integration. By merging two businesses into one, the new organization now has access to a larger base of customers. When a company's customer base increases, the new company can now boost its revenue. Finally, companies that opt for horizontal integration benefit from reduced competition in their industry, increasing the synergy between two companies (including marketing resources), and reducing some production costs. Even though a horizontal integration may make sense from a business standpoint, there are downsides to horizontal integration for the market, especially when they succeed. This kind of strategy faces a high level of scrutiny from government agencies. Merging two companies that operate within the same supply chain can cut down on competition, thereby reducing the choices available to consumers. If that happens, it may lead to a monopoly, where one company plays a dominant force, controlling the availability, prices, and supply of products and services. Big mergers like these are the reason why antitrust laws are in place. Antitrust laws are intended to prevent predatory mergers and acquisitions that may create a monopoly. where one company has too much influence and a high market concentration. After horizontal integration, the new, larger company may take advantage of consumers by raising prices and narrowing product options. Read more...

Impact of global sourcing on global supply management

Global sourcing is the practice of sourcing from the global market for goods and services across geopolitical boundaries. Global sourcing often aims to exploit global efficiencies in the delivery of a product or service. These efficiencies include low cost skilled labor, low cost raw material and other economic factors like tax breaks and low trade tariffs. A large number of Information Technology projects and Services, including IS Applications and mobile phone apps and database services are outsourced globally to countries like India and Pakistan for more economical pricing.

Common examples of globally sourced products or services include labor-intensive manufactured products produced using low-cost Chinese labor, call centers staffed with low-cost English speaking workers in the Philippines, India and Pakistan, and IT work performed by low-cost programmers in India and Pakistan and Eastern Europe. While these are examples of Low-cost country sourcing, global sourcing is not limited to low-cost countries. Global sourcing initiatives and programs form an integral part of the strategic sourcing plans and procurement strategies of many multinational companies. Global sourcing is often associated with a centralized procurement strategy for a multinational, wherein a central buying organization seeks economies of scale through corporate-wide standardization and benchmarking. A definition focused on this aspect of global sourcing is: "proactively integrating and coordinating common items and materials, processes, designs, technologies, and suppliers across worldwide purchasing, engineering, and operating locations (source: Wikipedia. Read more...).

In the modern supply chain, global procurement of raw materials, components and manufacturing is the norm rather than the exception. Over the last few decades, businesses have increasingly cultivated relationships with third-party suppliers outside of their own country. The production of goods integral to international trade is spread across a global supply chain that involves multiple factories in multiple countries. The rise of global sourcing leads to new supply chain management challenges that can change daily or hourly. Today, it means activating manufacturing partners early to anticipate shortages and demand spikes before they happen. Tomorrow, it could mean being able to scale down production if demand shifts. That type of agility is difficult to achieve, so supply chain leaders need to be aware of circumstances around the globe. Looking at global procurement through a strategic lens leads to smarter decisions in the last mile of global procurement. It also means strategic sourcing and working with redundancies in supply; all, of course, while keeping costs down. Today’s supply chain leaders must create a procurement process that includes contingencies for logistics and raw material suppliers. Any procurement professional needs to factor tariffs, embargoes, and trade wars into their global procurement plan. While the COVID-19 pandemic has highlighted the importance of effective supply chain management to keep global commerce moving, it has also accelerated the wide adoption of best practices that are integral to a sustainable supply chain. As we’ve seen from supply chain leaders like Apple and Amazon, focusing on global procurement provides a significant competitive advantage over companies that limit procurement to domestic production (source: University of Tennessee. Read more...).

How to lead an effective meeting

 No one wants to attend a dull, unproductive meeting. Here's how to make yours engaging and successful. Without an efficient leader, meetings can quickly become a soul-sucking waste of time for anyone stuck in a seat around a conference table.

"Meetings take up a lot of people's time, and they are often inefficient," says Ben Dattner, PhD, an executive coach and adjunct psychology professor at New York University. "There aren't clear agendas and timetables, and they tend to ramble and not achieve their goals. The leader should be ultimately accountable for having a well-run meeting, but everyone who attends the meeting has a role to play." U.S. employees spend an average of nine hours a week preparing for or attending team meetings, but more than a third of employees believe those meetings are a waste of time, according to a nationwide poll by Clarizen, a software company. Almost half of employees would rather do any unpleasant activity rather than sit through a meeting, including waiting in line at the DMV or watching paint dry, the poll found. Meetings can feel like a group therapy session for a leader who must deal with vastly different personalities and potential land mines from office or university politics, Dattner says. "In a way, meetings are like a microcosm of the team dynamic," he says. "It's always an art rather than a science on how you balance being flexible and open without being disorganized or meandering." Read more...

Understanding Frontier Markets

 A frontier market is a term for a type of developing country's market economy which is more developed than a least developed country's, but too small, risky, or illiquid to be generally classified as an emerging market economy. The term is an economic term which was coined by International Finance Corporation’s Farida Khambata in 1992. The term is commonly used to describe the equity markets of the smaller and less accessible, but still "investable" countries of the developing world. The frontier, or pre-emerging equity markets are typically pursued by investors seeking high, long-run return potential as well as low correlations with other markets. Some frontier market countries were emerging markets in the past, but have regressed to frontier status (source: Wikipedia, read more). While they are smaller, less accessible, and somewhat riskier than more established markets, frontier markets are still investable. They are considered desirable by investors looking for substantial long-term returns because these markets have the potential to become much more stable and established over the course of decades. However, it is also possible for a more established, emerging market to regress to frontier market status; investing in these markets is still risky. Investors pursue frontier equity markets to seek potentially high returns. As many frontier markets do not have developed stock markets, investments are often private or direct in startups and infrastructure. Although it’s possible to achieve strong results from investing in frontier markets, investors must also accept higher risks than in the United States or Europe, for example (or any other of the G7 nations). Some of the risks investors face in frontier markets are political instability, poor liquidity, inadequate regulation, substandard financial reporting, and large currency fluctuations. In addition, many markets are overly dependent on volatile commodities (Source: Investopedia, read more...).

Environment key to injury recovery

 Black men are disproportionately impacted by injuries in the United States. This disparity is glaring given that injury is one of the top ten causes of death. Data show that injured Black men from disadvantaged neighborhoods experience higher injury mortality, years of life-expectancy loss, and psychological symptoms that persist after initial wounds have been treated.

While much research has examined individual characteristics that predict poor recovery from injury, fewer studies have focused on social and physical features of the environment and how they may impact the recovery of injury survivors. A new study from the University of Pennsylvania School of Nursing (Penn Nursing) focuses on injured Black men's perceptions of their injury recovery environments, including how unsafe they feel and the varying availability of resources for recovery within their neighborhoods. The findings emphasize the importance of the neighborhood environment in recovery after injury and the role of social support and resource allocation to injury survivors in the aftermath. The study has implications for the need for changes that could better support patients dealing with the consequences of serious injuries within the context of neighborhood-level adversity. "Our findings raise important considerations on the inpatient and discharge experiences of injury survivors. Survivors expressed significant barriers to recovery, and the importance of their social networks but limited resources available to them. Our participants expressed a deep human need to be listened to and treated with respect," says Marta Bruce, PhD, RN, of Penn Nursing and an intensive care nurse at the Hospital of the University of Pennsylvania, lead author of the article. "This research points to the importance of intervention at the critical window of the inpatient experience prior to discharge for increased empathetic communication, better coordination of social work and mental health services, and better planning for the challenges of discharge raised by our participants," says Therese S. Richmond, PhD, RN, FAAN, Andrea B. Laporte Professor of Nursing and Associate Dean for Research & Innovation at Penn Nursing, and co-author of the study. "Clinicians should consider that an injury represents a traumatic disruption in survivors' lives and that the journey to recovery is affected by social and environmental factors outside the walls of the hospital." The study's findings have been published in an article, "Injured Black Men's Perceptions of the Recovery Environment," in Social Science & Medicine and is available online. Coauthors of the article include Connie M. Ulrich, PhD, RN, FAAN, Lillian S. Brunner Chair in Medical and Surgical Nursing, Professor of Nursing, and Professor of Medical Ethics and Health Policy; and Jessica Webster, MS, LPC, both of Penn Nursing. Read more...

Effects of Fictitious Commodities on the Market

 The concept of fictitious commodities (or false commodities) originated in Karl Polanyi's 1944 book The Great Transformation and refers to anything treated as market commodity that is not created for the market, specifically land, labor, and money.

Critique of commodification

For Polanyi, the effort by classical and neoclassical economics to make society subject to the free market was a utopian project and, as Polanyi scholars Fred Block and Margaret Somers claim, "When these public goods and social necessities (what Polanyi calls "fictitious commodities") are treated as if they are commodities produced for sale on the market, rather than protected rights, our social world is endangered and major crises will ensue." Polanyi's insight follows the Marxian notions of "commodification" and "Commodity fetishism." Fetishism in anthropology refers to the primitive belief that godly powers can inhere in inanimate things, e.g., in totems. Marx uses this concept to describe "commodity fetishism." For Marx, "a commodity appears at first sight an extremely obvious, trivial thing. But its analysis brings out that it is a very strange thing, abounding in metaphysical subtleties and theological niceties." And what is a social relation between people, between "capitalists" and "exploited laborers," instead assumes "the fantastic form of a relation between things." David Bollier wrote that, according to Polanyi, "prior to the rise of the market as an ordering principle for society, politics, religion and social norms were the prevailing forces of governance. Land, labor and money itself were not regarded chiefly as commodities to be bought and sold. They were embedded in social relationships, and subject to the moral consideration, religious beliefs and community management." As Polanyi points out, these are actually “fictitious commodities” in the sense that they are not truly discrete “products.” Land and human beings have their own sovereign dynamics apart from their treatment as market commodities. Treating them as...Read more...

Some gender disparities widened in the U.S. workforce during the pandemic

 The COVID-19 recession resulted in a steep but transitory contraction in employment, with greater job losses among women than men. The recovery began in April 2020 and is not complete. As of the third quarter of 2021, the labor force ages 25 and older remains nearly 2 million below its level in the same quarter of 2019.

The pandemic is associated with an increase in some gender disparities in the labor market. Among adults 25 and older who have no education beyond high school, more women have left the labor force than men. Other disparities have stayed the same or even narrowed: The gender pay gap has remained steady, for example, and the difference in the average hours worked by men and women has slightly diminished. Overall, the number of women ages 25 and older in the labor force has fallen 1.3% since the third quarter of 2019, similar to the 1.1% decline of men in the labor force. But this modest overall change obscures divergent outcomes for labor force members with different levels of education. Women who have no education beyond high school exited the labor force in greater numbers than similarly educated men. However, the pandemic has not interrupted the long-running gains of women among the college-educated labor force. From the third quarter of 2019 to the same quarter of 2021, the number of women in the labor force who are not high school graduates decreased 12.8%, dwarfing the 4.9% contraction among comparably educated men. The pandemic also disproportionately affected women with a high school diploma. The ranks of women in the high-school-educated labor force have declined 6.0% since the third quarter of 2019. The labor force of similarly educated men has fallen only 1.8%. Read more...