This assignment will consist of 2 separate documents, each document will be a 200 word reply written in first person directly addressing the student. For example, ” I agree with your argument…”, “You make a good point…” “In my post I also discussed…” ” I disagree..” etc.*Must be written at graduate level comprehension*Must include the course the textbook.*Must be written in APA formattingReply to 2 classmates’ threads. Each reply must be at least 200 words and include at least 2 peer-reviewed references.Topic: Choose a publicly traded company that you are familiar with.Go to the selected companys website and look at their annual report (10k). If you prefer, you may also go to the Securities Exchange Commissions EDGAR database and download the annual report. In researching the company, determine the companys critical success factors. In a thread of at least 400 words, explain what you believe the critical success factors are, and what the company needs to do to either gain a competitive advantage, or maintain their competitive advantage. Your thread must include 2 peer-reviewed references. In module/week 2, you will substantially reply to 2 other students’ threads. Each reply must include 2 peer-reviewed references and be at least 200 words.
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April 26, 2018
ExxonMobil Corporation principle business is energy, involving the worldwide
exploration, production, transportation and sale of crude oil and natural gas (Upstream), and the
manufacture, transportation and sale of petroleum (Downstream). The Corporation is also a
major worldwide manufacturer and marketer of petrochemicals (Chemical).
The companys integrated business model, with significant investments in Upstream,
Downstream and Chemical segments, reduces the Corporations risk from changes in commodity
prices. Exxon Mobile, Corp. is the largest public oil and gas company in the world with a
massive market cap of $303 billion, and is the fifth largest company by market capital in the
United States. Exxon has a very strong record in paying and growing dividends, and increasing
their dividend payments annually for the last 30 years (Edwards, 2015). Exxon has taken steps to
shore up its financial position by cutting its Cap Ex by $4 billion for 2014. The cuts to CapEx should free up
cash flow to continue dividend payments (Edwards, 2015).
ExxonMobil, with its resource base, financial strength, disciplined investment approach and
technology portfolio, is well-positioned to participate in substantial investments to develop new energy
supplies. By 2040, the worlds population is projected to grow to approximately 9 billion people according to
ExxonMobils 10K annual report. Liquid fuels provide the largest share of global energy supplies today. By
2040, the company expects global demand to grow to approximately 112 million barrels of oil per day
ensuring the need for the companys commodity. The company maintains competitive advantages due to its
massive size, which creates economies of scale in its favor. Exxon is also significantly diversified across many
different projects. Unlike smaller oil and gas companies that only invest in limited projects, Exxon has the
capital and resources to spread out its capital investments (Edward, 2015).
ExxonMobil is a conservative companysome say too conservative. However, its
decision to remain integrated was a sound one. While low oil prices arent fun for the company,
it wont lead to its immediate demise, either (Sanati, 2016). ExxonMobils sound financial
position gives it the opportunity to access the worlds capital markets in the full range of market
conditions, and enables the Corporation to take on large, long-term capital commitments in the
pursuit of maximizing shareholder value.
Edwards, J. (2015, September 30). Exxon Mobil Stock: A Dividend Analysis (XOM)? Investopedia. Retrieved
Sanati, C. (2016, February 3). Exxon Shows The Benefits of Being Big in a World of Low Oil
Prices. Fortune. Retrieved from http://fortune.com/2016/02/03/exxon-big-oil-benefits/
ExxonMobil Annual Report. Retrieved
Running head: DISCUSSON BOARD FORUM THREE
Discussion Board Forum Three
DISCUSSON BOARD FORUM THREE
When measured in terms of revenue, Republic Services is the second largest trash hauling
company in the United States. Generating an annual revenue of around $60 billion, the company
has a national focus and orients its growth towards areas of the country that are experiencing
population growth (Republic Services, 2017). Republic Services has a vision for the future,
which is definitely a factor to their continued success. Knowing where you want to be and
having plan to get there are a large part of the battle in being successful in your goals. This is
key for the company to have a chance at success in an economy that sees employees come and
go on a whim for various and sundry reasons, or offenses, and a consumer base that is
increasingly demanding in its expectations of service (Mayfield, Mayfield & Sharbrough, 2015).
Republic Services has, as its foundation towards continued success, a very detailed five
pillar strategy toward profitable growth through differentiation. The focus of these pillars starts
with building the best market position through building density and improving returns, an
operating model that focuses on a consistent, high-quality of service focused on the customer,
managing their 35,000 employees and talent, differentiating their product offerings to create
customer zeal, and continuing to focus on digitizing processes to better meet customer demands
(Republic Services, 2017).
Another aspect in which I feel the organization is continuing to see critical success is in
their management of capital allocation. They seemingly take a hard look at the current market
versus expenditures when considering where to invest capital to better enable the company to
challenge its competitors. As it relates to capital allocation, research has shown that presently
companies rely on several factors when considering capital allocation. These include net present
value (NPV) ranking, the timing of cash flows, to include financial constraints, as well as
DISCUSSON BOARD FORUM THREE
internal rules established by individuals in charge that are close to the situation (Graham, Harvey
& 2015). On the surface it appears that Republic Services holds to several of these principles as
it responsibly manages capital investments in the future of the company.
In short, I think that Republic Services is on the right track to challenge its competitors.
They have a great vision and strategy to continue forward progress. The key will be focusing on
emerging markets, customer service, and management of their employees and talent pool.
Focusing on their already established five pillars will be key. As with many companies, strategy
is a great idea, but it means nothing if it is not properly implemented and managed from top to
DISCUSSON BOARD FORUM THREE
Graham, J. R., Harvey, C. R., & Puri, M. (2015). Capital allocation and delegation of decisionmaking authority within firms. Journal of Financial Economics, 115(3), 449-470.
Mayfield, J., Mayfield, M., & Sharbrough, W. C. (2015). Strategic vision and values in top
leaders communications: Motivating language at a higher level. International Journal of
Business Communication, 52(1), 97-121. doi:10.1177/2329488414560282
Republic Services. (2017). 2017 Summary Annual Report. Retrieved from http://phx.corporateir.net/phoenix.zhtml?c=82381&p=irol-reportsannual
Sams Club is currently the second largest warehouse club retailer in the United States in
terms of market size (Evans & Satchu, 2010). The company has made small but steady market
and sales gains against its largest competitor Costco over the last several years due to investment
and gains in electronic commerce (Basker, 2007). Sams Clubs net sales saw a 2.1% decline
from fiscal year 2016 to 2015 with $56 billion comparted to $58 billion respectively (Wal-Mart,
2016). Although, Sams Club did have a 6.1% increase in membership income, which is a
significant driver for profits in the warehouse club retail market (Wal-Mart, 2016). Additionally,
Sams Club saw significant capital investments in its e-commerce networks such as Club Pickup,
which allows online ordering with an in-store pickup that should drive increased sales into the
coming years (Wal-Mart, 2016).
Within the warehouse club retail market, several critical success factors are driving the
competitive advantage over not only more traditional retailers such as Target, but over the big
three companies in the warehouse club segment (Evans & Satchu, 2010). Hicks and Hicks
(2014) define the critical success factors as those that are essential for future success and often
drive competitive edge within a market or market segment (p. 101). The four largest of these
critical factors that traditional retailers are having to contend with among warehouse retailers,
such as Sams Club, are limiting selections of items on shelves which reduces cost, lower price
points due to low markups and profits driven by membership fees, private-label brands such as
Sams Club/Wal-Marts Great Value and Costcos Kirkland Signature that allows for a price
advantage over name brands, and distributed purchasing which allows individual clubs to order
or carry products according to their region, including locally produced products (Evans &
The warehouse club retail segment itself has three critical factors that are driving
competition amongst the big three in Sams Club, Costco, and BJs (Evans & Satchu, 2010).
Those intra-market critical factors are store location, consumer perception amongst value-based
consumers, and e-commerce (Evans & Satchu, 2010; Cascio, 2006). Sams Club has historically
been behind Costco both in sales and market share, although Sams Club has been narrowing the
gap with capital investments in its e-commerce (Evans & Satchu, 2010; Wal-Mart, 2016). In
order for Sams Club to overtake Costco and gain a competitive advantage, Sams Club must
strengthen its appeal amongst value-based consumers who pay attention to environmental
sustainability, organic products, employee pay and benefits, and product quality (Cascio, 2006).
Sams Club could also narrow the market gap in competitive advantage with a store location
strategy similar to Wal-Marts with a ruthless focus on competition through proximity to
competitors stores (Basker. 2007).
Basker, E. (2007). The causes and consequences of Wal-Marts growth. Journal of Economic
Perspectives, 21(3), 177-198.
Cascio, W. F. (2006). Decency means more than always low prices: A comparison of Costco
to Wal-Marts Sams Club. Academy of Management Perspectives, 26-37.
Evans, A. & Satchu, J. (2010). Why Costco and other warehouse club retailers matter. Executive
Insights, 12(5), 1-3.
Hicks, M. & Hicks, S. (2014). Accounting for the Rest of Us. Raleigh: Synergistics International
Wal-Mart Stores, Incorporated (2016). Annual Report 2016. Bentonville, AR: Corporate Author.
Dillion, I found your discussion post very interesting. I found it rather compelling that
Sams Club saw net sales decline from 2015 to 2016. You did a great job in outlining Sams
Club critical success factors. Upon further research, I came to the same conclusion in stating that
in an era of globalization e-commerce can make or break a companys profit margin (M2
Presswire , 2015). According to Presswire.com (2015), more than 250 million customers visit
over 11,462 stores under 65 banners in 28 countries and e-commerce websites in 11 countries.
Furthermore, Lee (2015) states that in the current era of globalization, successful companies and
multinational businesses must effectively integrate and manage numerous resources in order to
maintain an effective advantage against competitors. Included in these resource is the application
and implementation of electronic-commerce (E-commerce). E-commerce is a critical part of
current business behaviors in the contemporary business world. E-commerce employs digitized
communication networks, computers or modern information technology (IT) tools to bring
consumer products directly from the manufacture to the customer. Given the constant and rapid
innovation in the technology industry, businesses must adapt and remain flexible into to ensure
they remain relevant to the ever-changing population base.
Lee, C.-Y., Lee, T.-R., & Kao, C.-K. (2015). Study on the Adaptation of Corporate Business
Strategy to E-commerce Practice. Advances in Management and Applied Economics, 2543.
M2 Presswire . (2015). Walmart Opens New e-Commerce Fulfillment Center in Bethlehem, PA.
M2 PressWire, n/a.
The Boeing Company is one of the leading aerospace companies in business today. Since 1916,
Boeing has been on the leading edge of aerospace technology. In fact, Boeing created the first
commercial pressurized airliner (Deen, 2013). The company has found success in both the commercial
airline market as well as with the U.S. military, providing the military with aircraft, satellites, and other
technologies useful in the defense of the nation.
Critical Success Factors
This partnership between the U.S. military services and The Boeing Company has played a crucial
role in the companys success by providing a stable market for Boeings products. For example, Boeings
revenues in 2013, 2014, and 2015 were approximately $87 billion, $91 billion, and $96 billion
respectively. Of each of those years, approximately one-third of the revenues came from Defense, Space,
& Security, while the other two-thirds came from Commercial Airplanes (Boeing Company, 2015). Most
recently, in 2011, Boeing was awarded a $4.9 billion contract to design the Air Forces new KC-46 Pegasus
aerial refueling aircraft (Boeing Company, 2015). The first nineteen aircraft are to be delivered by 2018
(Dodaro, 2015). To make the delivery of the initial nineteen aircraft, Boeing was awarded $2.8 billion in
2016 (Ramey, 2016).
The relationship with the military does not end there. The Boeing Company was behind the
design of several other fighter and airlift aircraft commissioned by the military including the F/A-18 Super
Hornet, F-15 Eagle, and C-17 Globemaster (Boeing Company, 2015). The symbiotic relationship between
the U.S. military and The Boeing Company has created a stable platform upon which Boeing can lean to
stay ahead of its competition.
In addition to Boeings tremendous success from its work with the U.S. military, the company has
experienced remarkable success in the commercial airline market with its various models of commercial
aircraft. As previously stated, Boeings commercial airline sector actually makes up for roughly two-thirds
of its revenues (Boeing Company, 2015). However, while the commercial sector is where Boeing makes
most of its money, the services and products for the military form a firm foundation for Boeing.
Cautions for Boeing
The technologies and products that Boeing works with and provides are extremely expensive for
the average shopper. Working with billions of dollars on a yearly basis, it would not take very many
mistakes or failed products to put the company in jeopardy. This is especially true considering the
companys debt-to-equity ratio of 5:1 (Boeing Company, 2015). It is smart of Boeings leaders to use debt
to finance the research and development of the companys products because of the amount of capital
required to fund such products. However, working with such a large debt-to-equity ratio can be
dangerous for Boeing if it experiences several years of low revenues.
Additionally, while Boeing is one of the largest airline companies in the world, its main competitor,
Airbus, is a tough rival. Founded in 1970, Airbus has emerged as a strong competitor for Boeing (Tong &
Tong, 2003). Airbus already competes with Boeing in the military sector by providing aerial refueling
aircraft to the Royal Australian Air Force, and the company almost won the bid to develop the U.S. Air
Forces newest aerial refueling aircraft, the KC-46, losing the bid to Boeing after intense scrutiny. Globally,
Boeing competes with Airbus in many of the same markets.
In the end, Boeings stability and longevity are difficult to match. Its relationship with the U.S. and
foreign governments providing aircraft for military operations helps ensure its success for many
years. This strong foundation has enabled the company to continue to push the envelope in the
commercial sector. The returns from both markets have helped make Boeing the successful company it is
today. The large amount of debt that Boeing works with is one of the biggest concerns looking at
Boeing. It would be beneficial for Boeing to increase its available capital and reduce some of the debt it
uses for operations in order to put the company in a stronger position.
Boeing Company. (2015). 2015 annual report.
Deen, L. (2013). Boeing and the future of aviation. Hispanic Engineer and Information Technology, 28(2),
Dodaro, G. (2015). Assessment of selected weapon programs.
Ramey, C. (2016, August). Boeing awarded $2.8B for KC-46 tanker initial production. Everett, Washington.
Retrieved from http://boeing.mediaroom.com/news-releases-statements?item=129760
Tong, C., & Tong, L.-I. (2003). Boeing vs. Airbus: Competing for the future. Competitiveness Review: An
International Business Journal, 13(2), 36-41.
Kyle, your analysis and well thought-out discussion was truly beneficial. I concur with
your overall assessment that Boeing is and will continue to be an industry leader for the unseen
future. I would like to further expand on Boeings heavily reliance on government contracts as a
source of revenue. According to Gardner (2012), military spending is contingent on the will of
policy makers and the health of the economy. Historical, when the economy is stagnant,
lawmakers routinely cut large government contracts in order to save money. So ultimately, when
a potential investor considers buying stock in Boeing further analysis must be done to determine
the status of the economy. Furthermore, Klinger (2014) argues that Boeing is not practicing
corporate citizenship or social responsibility. From 2008 to 2014, Boeing reported to the
Securities and Exchange Commission between $1.6 billion and $5.9 billion in profits each year,
yet the company paid no federal income taxes. Additionally, over the last six years, Boeing
reported $26.4 billion in pre-tax profits to its shareholders, while claiming a total of $105 million
in refunds from the IRS, an effective tax rate of -0.4 percent.
I am not arguing the fact that government contracting is/is not vital to national security. I
am simply stating that big business must be held accountable to unethical business practices. Dr.
Fischer (n.d.) illustrates this point well when he discusses the need for companies to stay
competitive and relevant to an ever-changing population.
Fischer, K. (n/a). Globalization and Big Business. BMAL 560 presentation. Liberty University .
Gardner, D. (2012). Defense Cuts: Local businesses who rely on DOD spending run the gamut
from machine shops to lock-makers. Northeast Pennsylvania Business Journal, 65.
Klinger, S. (2014). Boeing, Second Largest Federal Contractor, Pays No Federal Income Tax in
2013. Center of Effective Government , n/a.
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