Decisions in Paradise the Company

Decisions in Paradise

The company has several strengths from which to draw in its dealings on Kava. The company has the backing of the Kava government, which is essential to getting things done. Permits and paperwork in particular can be dealt with efficiently as a result of this support. There should be no undue delays in construction either. Another strength is the experience level that the company has on Kava. With years of experience, the company (aside from Nik) has substantial experience dealing with the local culture and economic conditions. This experience will help the company deal with any problems that may arise in its projects. Lastly, the company has substantial global experience and a sizable stock of capital -- it is not dependent on the Kava project for its success.

There are a few weaknesses, however. Objectively it is necessary to highlight Nik's lack of experience as a weakness, especially as it relates to skepticism and lack of optimism. Nik needs Alex to make the project work, given this inexperience. Another weakness in this project is the constraints put on the company by the Kava government, for example the expectations of doing social good -- this creates additional measures and stipulations that may conflict with the company's core strategic goals. Another weakness could potentially be the island's location. The South Pacific is often a remote area from which to build a business, so the business could ultimately be constrained by the size of the immediate market.

There are a number of opportunities, however. Kava is rich in assets, both physical and human. It has the potential to be a leader in the region, and a crossroads for trade with both the U.S. And China because of its demographics. With a relatively young population, Kava could also benefit over the coming years from the impacts of having a large and growing workforce.

That said, there are a number of threats as well. The myriad threats represented by Mother Nature are the first, and there are so many of them that the company may not be able to adequately insure against them. Another potential threat is new competition. If the Kava market is as attractive as it could potentially be, then new competitors can be expected to enter the market. In addition, developing world economies can be highly volatile, and this could also be the case with Kava. Therefore it is essential that the company be aware of shifts in the economic climate when operating on the island.

Essentially, the decision has largely been made for Nik by the company already -- they are going to expand their presence in Kava. What Nik needs to do at this point is to address the risks associated with the project and lay out a course of action for increasing involvement. There are a couple of key recommendations therefore. The first is to work with the government carefully to manage their expectations with respect to the company's involvement in their country. Relations are good, but if the project fails to live up to their expectations, those relations could sour. Dealing with local governments is a key element of working abroad, but it is important that the company's needs remain paramount. It will be incumbent on Nik to work with the government to strike a balance that meets everybody's needs.

The second recommendation for Nik is to manage the downside impacts of natural disasters. Such disasters remain the single greatest threat faced by the company's operations. Not only is it important to insure against natural disaster but it is also important that the company take other steps to protect its investment. This could mean adhering to stricter construction standards, using multiple locations around the country and having a stockpile of supplies that can be used to deal with emergencies. An emergency management strategy should be developed for each possible contingency, with an eye to protecting the company's investments in Kava.

The third recommendation is for Nik to work closely with Alex on this project. Nik's inexperience is a risk to the project, so she should not fear asking for guidance from seasoned professionals. Nik needs to work within her abilities in order to succeed, and recognizing her own limitations is part of that. Ultimately, the company does not know for certain she is capable of managing this project, but it believes that she is. She needs to believe in herself now, and understand that working closely with her mentors and with head office is essential to making this project a success.

There are a number of resources available for this solution. The company's previous experience in Kava and around the world should be considered a valuable resource, especially with respect to mitigating risks and dealing with the government. The company will have experienced similar situations before and have gone through the process of implementing these types of strategies before as well. Another resource is the government of Kava and the company's local partners on the ground. These locals will have a better sense not only of the risks associated with the project but of the local resources available to mitigate the risks. The last resource is Alex, who can help mentor Nik and take her through this process.

There are a number of ethical implications of these solutions. The dealings with government raise a number of ethical issues, including the extent to which the company can and should help the people of Kava. While helping the people is part of the strategic mission of the company, Nik must also weigh the needs of other stakeholders, from the Kava government to her firm's own shareholders. Only by understanding the needs of all stakeholders and prioritizing those needs can Nik successfully achieve a set of outcomes that is positive for all.