Welcome to Professor Pick. Provides a hand-picked selection of FT articles by business school teachers to connect classrooms to current events and develop student critical thinking.
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International Business Strategy
Apple proposes Indonesian factory to reverse the iPhone 16 ban
Indonesia says a billion dollar offer from Apple isn’t enough to lift the iPhone 16 ban
Tags: Technology, Foreign Direct Investment, Local Content Requirements, Indonesia
Summary: Indonesia has imposed a 40% local content requirement (LCR) on smartphones and banned the sale of iPhone 16s due to Apple’s failure to comply. The policy aims to strengthen local manufacturing, increase job creation and reduce reliance on imports. Apple initially offered to invest $10 million and later raise it to $1 billion for the Airtag factory, but Indonesia argued that the investment should directly contribute to the production of the iPhone. LCRS can promote domestic industries, but it could also block foreign direct investment by increasing cost and regulatory uncertainty.
Classroom Application: In this example, students can examine the role of local content policies in shaping investment decisions. We investigate whether such regulations promote industrial growth or act as a barrier to trade. Teachers can also guide discussions about Apple’s strategic options: compliance, negotiation, or withdrawal to the Indonesian market.
question
What are local content requirements? Also, how does it affect foreign direct investment?
What economic and political goals is Indonesia trying to achieve by implementing a 40% local content requirement?
Is Apple’s $1 billion investment proposal consistent with the intent of Indonesia’s local content requirements? Why/Why not?
Given Indonesia’s local content requirements, we assess whether joining a joint venture (JV) is a sensible strategy for Apple. What are the potential opportunities and challenges that may be faced? Is this strategy consistent with long-term goals in the Indonesian market?
What lessons does Apple’s experience teach multinational companies entering the market in a strong regulatory environment?
Geopolitics, Global Supply Chain
Apple looks to open its first flagship store, so it hires Indian workers
“Shot across the Bow”: How Geopolitics Threate Apple’s Reliance on China
Tags: geopolitics, US-China relations, China, apple
Summary: As tensions between the US and China grow, Apple faces an increasing number of challenges in China, both producing the majority of its products, generating nearly 20% of global sales. The recent government’s IPHONE ban on certain institutions indicates a growing economic nationalism in Beijing and strategic retaliation for US restrictions on Chinese tech companies like Huawei. In response, Apple is switching production to India and Vietnam to accelerate supply chain diversification and mitigate risks. This case highlights how geopolitical tensions shape global trade and how multinationals are reshaping the strategic issues facing them in the host market. .
Classroom Applications: This case allows students to explore the impact of geopolitical risks on multinational corporate strategies, focusing on the risk of changes in Apple’s supply chain and excessive reliance on a single market. Masu. Teachers will encourage debate about whether Apple should be completely detached from China or maintain strategic involvement, comparing it with other companies such as Tesla, Samsung and Tiktok, which face similar dilemmas. You can do it.
question
What are the key factors behind Apple’s diversification strategy?
What does the phrase “shot across the bow” mean about the nature of the Chinese reaction? Is China specifically targeting Apple?
If tensions between the US and China continue to escalate, what will be the long-term impact on the global supply chain?
India’s ambition to become a global manufacturing hub affected by the limitations of bottlenecks in the processing of foreign direct investment in China and visas for Chinese tech workers, has led to the fact that Indian industry representatives “important for the development of the electronic industry.” He says that. skill”? What challenges do these policies pose for multinational companies that change production from China?
Mohamed Genowy, Lecturer, Manchester Metropolitan University Business School
Micro Economics
Spotify reports first annual profits as premium subscribers spike
Tags: micro economy, pricing power, profitability, streaming, music
Summary: 16 years after its launch, Spotify posted its first annual operating profit. Our revenue increased by 16% as customer payments increased by 11% and revenue per user increased. Spotify CEO Daniel Ek points to new features such as uninterrupted video podcasts and personalized AI products.
Classroom Application: This article provides the opportunity for faculty and students to analyse the challenges to profitability in the high-growth technology industry.
question
Why did it take so long for Spotify to ultimately make a profit?
What is the company’s biggest threat to profitability?
Are innovative features like cost-reducing or personalized playlists and video podcasts enough to make them profitable?
What logic underpins Spotify’s decision from 2020 onwards to invest a substantial amount in a podcast?
Which lessons can I learn from Netflix on Spotify?
Stefan Legge, Lecturer at St Gallen University
automation
ISU self-service lessons for retailers on Robots doing their best
Tags: Automation, Consumer Behavior, Human Touch Points, Retail, Customer Service, Data, Leadership, Differentiation, Food Sector
Summary: When automation is rising across the service industry and labor costs are set to dramatically increase, at least in the UK, the sushi chain ITSU, famous for its early adoption of robotics through customer service experiences, is that It was announced that it has been announced. Introducing more human service touchpoints at restaurants. Founder Julian Metcalf recently said, “I think I’ve embraced technology too quickly.”
Application: This serves as a mini case study for discussion on the subject of human and mechanical services experiences. Customer journey optimization (including the ability to collect different types of data at different touchpoints); changing consumer behavior in an increasingly automated world. Human interaction as a differentiator in an automated world. and the power of bold and bold leadership decisions. Instructors must be creative about how to use the following questions – discussing between two aspects of discussion about more human interaction, and the service employees of ISU restaurants Roleplay some and design training programs for new service employees.
question
What should ITSU gain by bringing more employees into the restaurant? How do each of these factors transform into the economic value of an ISU? How do you build the business case to present to the ITSU leadership team?
How do you understand how a particular touchpoint of a customer’s restaurant trip benefits from more human-machine interactions? What steps would you take if you were charged to explore this question?
Does the increase in human interaction provide opportunities for service brands to differentiate themselves in the market? How can I do it? Do you think the extra costs of hiring more service employees should be reflected in the higher prices, or is there another way to incur the extra costs?
Given your personal experience as a consumer, do you agree with Metcalf that technology may be generally accepted too quickly across the service sector? Provide discussion for your opinion
What other service environments will benefit from a rethinking of the machine/human ratio? How do you build a business case for this change when presenting it to the company’s executive team?
How do you characterize Julian Metcalf’s decision? What does this decision suggest about his leadership skills? What are the immediate results? Also, how do you characterize his own position and ITSU in the crowded ethnic fast food market?
Marie Taylord, teacher at Escu
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