Cliq-Up Internet Has Now Become a New Essay
- Length: 4 pages
- Sources: 3
- Subject: Business
- Type: Essay
- Paper: #74648515
Excerpt from Essay :
Internet has now become a new frontier in regards to economic development. With the advent of the internet, new and seemingly boundless technologies have arisen. Aspects such as routine transactions at financial institutions to online dating sites have now entered into the forefront. Technology overall has enhanced the overall quality of life for civilization while also providing economic growth. It is during this expansionary period that many innovative and profitable technologies arise. CliqUp is no different in this regard. With the advent of the internet, the need for synthesis and analytics becomes very profound. As such, CliqUp has very unique value proposition for both businesses and consumers as the technology frontier continues to evolve. Using analytical data, CliqUp can provide enhanced value to businesses in terms of targets ads, customer demographics, and other analytical tools. All of which, adds value to the institution of firm who properly utilizes the technology.
As is the case with many smaller, less established companies, funding can become a very contentious issue. With many internet companies, an established network must first be created in order to return recurring value to the owners. Google had to first create a network of primary users. Facebook needed to create a network of profiles. IBM needed to create a network of companies utilizing its data storage capabilities. In each instance, the company may have incurred financial losses in an effort to create a sustainable and viable network of users. Such is the case with CliqUp. The company's main source of competitive strength is in its ability to produce quality customer research at a fraction of the cost of other providers. However, this strategy is very difficult to do in the midst of a very competitive business environment. For one, CliqUp does not have the financial resources in which to sustain being a low cost producer. IBM for instance, also operates in the same field as CliqUp. If CliqUp becomes too much of a threat, IBM could simply lower its pricing even lower than CliqUp and wait for the company to become insolvent. Wal-Mart has received much negative press for this strategy of simply lowering prices to defeat competition. However, as CliqUp is a very small firm, the likelihood of survival when competing against larger, more established companies, is very difficult.
As such, the best option for CliqUp, if it is to maintain its current pricing strategy, is that of a corporation. In this capacity, CliqUp has access to funding through the capital markets. By becoming a publically traded corporation, public funds can be used to help bolster the financial position of the company. In addition, by being a public company, the firm can attract top level manager to sit of various board positions. This allows the company to remain relevant within the overall financial community while also having the leadership ability to effectively compete with larger firms. In addition, top management and board positions also provide contacts and connections that will prove invaluable to the organization overall. These concepts are very important as they directly impact the company's survival (Business, 2008).
A negative aspect of such a structure is the lack of control for the founder members of the organization. As a public company, the original owners may be force to conduct activities that go against their personal desires. For instances, shareholders may elect to pay a dividend when the money is better served by being retained in the business. Shareholders may decide that a new chairman should be in place, when the current chairmen are better for the future growth of the business. The stock will also be subject to the natural vicissitudes of the market. As such, the company could lose a material amount of market capitalization by nothing more than rumors in the market. This can cause large disparities between the market price of CliqUp stock, the actual value of the stock.
In regards to choosing a facility location, the company should use a very distinct set of criteria. First, when analyzing the business, CliqUp does not require large amounts of fixed cost investments. Its primary business is customer research analytics which is based primarily on human capital. As such, the location of the facility should be in a low cost area. In a lower cost area, the company will pay less overhead, which could be allocated towards the salaries of the researchers. This will provide an incentive for which the analyst and researchers will be motivated to perform with. In addition the facility should be located in areas in which it inspires innovation and creative though. The company culture and the surrounding environment play a large role in the company's ability to innovate. Within its field of operations, CliqUp must constantly create new forms products that provide value to clients. The facility therefore, must be able to accommodate these needs for both clients and associates. Finally, the facility must be in an area that is near business establishments and operations. This geographic proximity to business partners is ideal as the company can better service clients. In addition, the company can use face-to-face interactions in which to better sell the value proposition of CliqUp relative to its competitors.
Compensation is a vital component of the organizations success in the future. Bonuses, Merit pay, Lump sum merit pay, Incentive rewards and Sales incentives are all correlated to performance. The technology industry stands to benefit from these plans as individuals may often work alone. For instance, with CliqUp, analyst and researchers may work in an independent manner. In many respects patients are very loyal to their respective technology providers as the cost of switching is very profound. As such, incentivizing these individuals through individual's plans would have a profound impact of overall performance. In particular incentive rewards would have the most impact on driving behaviors within the technology industry.
In addition, non-cash options work best for those who are intrinsically motivated by incentives. Aspects such as pension, deferred compensation, healthcare, and retirement benefits often work well for those who are looking for tax efficient manner to accumulate benefits. For example, deferred compensation allows an individual to defer their taxable income. This incentive will be particularly beneficial for those with higher tax brackets as they pay fewer taxes. As such, this form of pay for performance may only be of value to a select few individuals.
Stock options are also very appealing forms of compensation as they can easily appreciate in value. As such, by purchasing stock in a very small start up company, employees can garner large sums of wealth. By providing stock through the appropriate behavior of employees, the overall company is better aligned. For one, all stakeholders within the company what to achieve performance metrics as they directly impact their stock holders. As such, employees are more prone to work harder in an effort to help achieve sales or profit figures.
Ethics and social responsibility are very important irrespective of the community in which you conduct business in. All stakeholder groups are benefited from the use of ethical behavior. For one, as a corporation, CliqUp stock holders benefit as the financial numbers used to evaluate and engage in business activities are legitimate. These numbers will therefore provide a solid foundation in which to evaluate the merits of a particular activity such as a merger, acquisition, dividend, stock buy back and so forth. Consumers benefit as they are not mislead in regards to purchasing decisions. These builds trust as the brand will become synonymous with ethics further expanding the market share of the CliqUp. This will then benefit the shareholders even further as more consumers purchase products from this trusted company. The community benefits as CliqUp contributes to the community through the profits garnered from sales. As such, all stakeholder groups benefit and flourish (Scott, 2008).…