April 10, 2012
Assignment One – 2
1) Perform an analysis of the social/demographic, technological, economic environmental/geographic and political/legal/governmental segments to understand the general environment facing Great Lakes. Describe how Great Lakes will be affected by each of these external factors. Social/demographic
The social demographic segment reflects the population size, the age structure, the ethic and income mix, and the geographic distribution. The Great Lakes Corporation employs over 3700 people. (1) The population for Indianapolis, Indiana where the Great Lakes Corporation affects has increased at a rate of 6.6% from 2000 to 2010. (2) Technological
The Great Lakes Corporation will need to increase or expand its technology concerning the use of leaded gasoline. Technology can be costly when it comes to trying to come up with ways to eliminating a product that is harmful to consumers. Even though the corporation has had time to study what to do with the lead gasoline, there doesn’t seem to be a conclusion of the company’s next move. The longer the company waits, the more it is going to cost them. As stated in the case study, developing countries are going to eventually switch to unleaded gasoline which will put the pressure on the company to react quicker and possibly make decisions that are not thought completely through. Economic/environmental
Any decision the Great Lake Corporation is going to affect the economic environment. If the company chooses to wait until they are forced to make a change, the effect to the economy could result in massive amounts of money needed to make the adjustment. Usually when that Assignment One - 3
occurs, the company has a layoff to help recoup some of the money. This also affects the economy. The environment is affected because the lead is considered harmful. The environment will also be affected if there is a leak at the company. The environmental penalties that will occur if this happens will cost the company a lot of money. There will also need to be money spent to implement procedures to prevent this from happening again. Political/legal/governmental
The political/legal/governmental segment could also cost the company money. Politically when it is an election year, politicians usually take a stand on certain environmental issues. Great Lakes could get caught in the middle of one of those issues. The effect could be severe but if the company’s name is thrown into the spotlight negatively, environmentalist could target, lobby and boycott the company which could be expensive. The company would need to go to great lengths to reverse the negative impact from being in the spotlight. That could include advertising and still a study to eliminate the use of lead gasoline.
The effect of all the social/demographic, technological, economic environmental/geographic and political/legal/governmental segments is going to cost the company money regardless of which approach they take. To minimize the cost or to spread out the cost, the company should start studying other uses of lead gasoline or analyzing ways to slowly eliminate the use of lead gasoline. 2) Analyze the lead additives industry in the U.S. using the Five Forces of Competition Model. Describe the impact of each of the five (5) forces on the industry and based on this analysis, determine if the industry is attractive or unattractive.
Assignment One - 4
The five forces of competition model are threats of new entrants, threat of substitute products, bargaining power of suppliers, bargaining powers of buyers and rivalry among competing firms. Threats of New Entrants
When Great Lakes make the total transformation into not using lead gasoline, they will enter into a new market. This is going to be a challenge for Great...