Sample study: MISnet Inc. Essay
Sample study: MISnet Inc.
MISNet Inc. is a software company located at Makati Philippines founded at 1998. It is aimed to develop competitive software systems and has been in the business until now. By the year 2004, the company employed more programmers and workers as a part of their growing business strategy for the year 2008 because they predicted more projects and customers by the said year. But in the year 2005, the peso dollar exchange of the Philippines had slide from $1. 00 – Php 56. 00 to $1. 00- Php 40. 00 giving MISnet Inc. a big problem in pricing and selling their products to customer.
Since most software system products are made through contract, MISnet Inc. cannot change the price of their products to the customers who already signed a contract with them. An example is, instead of the original price of $10,000 into Php 56,000. 00, their product now sells Php 40,000. That is 28. 57% loss in their sales. MISnet Inc. tried to re-price their products to customers but none of them agreed. Some of their customer even left them and looked for other companies. Some payments are still in pending and MISnet employees are slowly transferring to other companies because of lack of trust to the company’s stability.
Aside from the peso dollar exchange problem, MISnet had also been investing in their employees giving them all the training and scholarships that they need to be the best in their fields. Hoping that this investment to their people would give them good results in the end, the company did not see that they involved themselves in spending more to their employees’ education rather than focusing into what the company really need such as their equipment, work environment and marketing. Because of this, some MISnet Inc. employees had been retrenched. …
We have to make sacrifices because the company is bleeding. Retrenchment has been a common term for MISnet because in their years of business, their third retrenchment happened last 2007. Although this strategy had saved MISnet Inc. from its problems, this experience made their employees lose their trust to the company and top management. Failure Failure refers to something that is not achieved or not meeting a desired goal. It is has been a part of our daily life and failures don’t happen without certain reasons. Why Companies Fail? There are many factors that make a company face the ground.
In the book titled “How to Write an Effective Business Plan in Just Three Hours” by Terry Collision, he listed down 12 key reason why companies fail. Quoted from him, are: 1. Inadequate planning of the business. 2. Inadequate planning of the business. 3. Inadequate planning of the business. … What kills companies usually has less to do with insufficient money, talent, or information than with something more basic: a shortage of good judgment and understanding at the very top. Once entrepreneurs have made the decision to go into business, too many fail to routinely step back and ask — or let others ask — if what they’re doing adds up.
Indeed, they’re swayed by their sentiments to act in ways that, unwittingly, put their businesses at risk. They rely on too much heart and not enough head. The company’s life depends on the management’s capability to run the business. Bad planning is one of the deadliest causes of business failure. It’s so crucial that Terry has to state it three times. 4. Insufficient initial capital for start-up period and development stages due to inadequate planning. … If you want to build a business, make sure that you have enough money to sustain the company for at least 2 years because you still have to adjust yourself and your business.
Since financial problems had been the toughest problem in a company. The business should have enough resources to backup anything that is lost in the company. 5. Mistaken estimate of market demand for product or service. Like the experience of MISnet Inc. , the management should always know how to look ahead and estimate the market’s demand in the future. The business may look good now, but without future planning and estimation, it’s like going to a place without a map. 6. Lack of management ability. Sometimes, the management lacks the ability to lead and organize the business.
This problem came from employees who are not fit in their position because of their lack of experience and knowledge to organize which will surely cause the business to fail. 7. Failure to select and use appropriate outside professional advice. It is hard to find people to trust especially when it comes to business. Personal advice to the people who organize the business has a lot of effect to the decision making of the management. If the management is not careful in choosing the people who will help them, the integrity of the management’s decision is at stake.
8. Inability to market product or service effectively. The task of the marketing department is to sell the product. Poor marketing may come from poor marketing strategies, inexperienced marketing people, lack of resources and sometimes lack of management’s support. 9. Over dependence on a single individual or on a predicted specific event. Over dependence to something or someone can cause a big project or company to fail. Over investment to something which is not sure will happen is a sign of risk strategy that is not healthy. 10.
Failure to understand capital requirements of a growing business. As stated, poor understanding to the business requirements is a sign of bad governance. Demands are naturally high every time the business is improving. If the management will not look this factor an important thing to consider, problems may rise in the end. 11. Poor timing of expenditures due to poor planning. Time is very crucial in any business. If the management doesn’t know how to use time well, many opportunities will be lost. 12. Expedient rather than reasoned decision-making.
University/College: University of California
Type of paper: Thesis/Dissertation Chapter
Date: 17 May 2017
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