CORPORATE SOCIAL RESPONSIBILITY
SELF-CHECK 10.3
responsibility policy will also help establish the firmÊs unique selling proposition and build customer loyalty.
Kramer and Kania (2006) have outlined four points to consider when designing a corporate social responsibility programme that can establish competitive advantage. The guide includes:
(a) Identify an issue that is crucial, current and strongly influences the firmÊs core competencies. Such issue will get the firm to be noticed and eventually boost the firmÊs reputation.
(b) Mere identification of a social issue to address is not sufficient. The firm must set quantifiable goals and constantly monitor progress of its effort.
Subsequently, progress report must be made known to all stakeholders.
(c) The firm must position its key resources to facilitate and support the social responsibility programme designed.
(d) The firm is also encouraged to establish cross sector partnership with other organisations that can support and contribute based on their expertise.
1. Discuss how a corporate social responsibility program should be developed in order to build competitive advantage.
2. Discuss five benefit(s) of observing corporate social responsibility in any entrepreneurial ventures.
3. When building competitive advantage, what are the issues that must be given due consideration by entrepreneurs? What other issues or measures to establish competitive advantage do you think may be important?
4. Corporate social responsibility requires the firm to include the concern for society welfare and environment into its business operations. At present, what are the important issues that you believe needs to be incorporated into any firms corporate social responsibility policy?
5. En. Jamal owns a batik print shop. He was wondering if he could adopt commerce for his business. What do you think? Can e-commerce be used for a traditional handicraft business? In what ways can he utilise the e-commerce technology?
ACTIVITY 10.2
• Firm must continuously service current customers, nurture new ones, develop new products/services, and achieve profit in their pursuit to ensure long term competitive advantage.
• There are four major issues that need to be considered by entrepreneurs when building their competitive advantage:
− Managing risks and uncertainties;
− Protecting the business idea (product/service);
− Embracing e-commerce; and
− Corporate social responsibility.
• Entrepreneurs are exposed to five common risks which are financial risk, economic risk, technical risk, market risk and strategic risk.
• In order to manage risks and uncertainties, entrepreneurs are advised to:
− Plan before acting;
− Constantly seek information;
− Control the degree of investment;
− Share risks with others; and
− Be flexible.
• Entrepreneurs need to protect their source of competitive advantage (products and services) from imitation using suitable intellectual capital protection measures outlined in the Malaysian Intellectual Protection legislation which includes patent, trademark, copyright, trade secrets, industrial design protection, protection of ICT layout design and geographical indications.
• There are three common types of Internet business model categories:
− Business to business (B2B);
− Business to consumers (B2C); and
− Consumer to consumer (C2C).
• Common Internet Business Models includes virtual storefront, information broker, transaction broker, online marketplace, content provider, online service provider, virtual community and portal.
• Digital credit card payment, digital wallet, accumulated balance payment, stored value payment systems, digital cash, peer-to-peer payment systems, digital checking, and electronic billing presentment and payment are the major electronic payment systems.
• Benefits one can expect from e-commerce are increased global presence, convenience to customers, alternative mode of advertisement, disintermediation, reduced transaction cost, coordination between strategic partners and customer personalization.
• Management challenges associated with e-commerce that must be given due consideration are inadequate security, achieving coordination, technology problems, and legal problem.
• Steps to follow through when starting and operating an e-commerce business includes: creating a website, registering the domain name, ensuring web presence, communicating with customers, keeping track of your competitors and system maintenance and upgrading.
• Corporate social responsibility refers to the concern for and inclusion of social and environmental consideration into business operations.
• Firms are not required to legally observe these expectations but encouraged to use them to guide corporate behaviour as it can boost firm reputation and build competitive advantage.
• Kramer and Kania (2006) outlined four points to consider when designing a corporate social responsibility programme that can establish competitive advantage: (1) Identify an issue that is crucial and current, (2) set measurable goals and report progress, (3) facilitate and support the social responsibility programme designed with key resources, (4) establish cross sector partnerships.
Accumulated balance payment Competitive advantage
Managing risk and uncertainty
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