9-4-3d Market Share The key output metric for some global businesses is marr share

or the percentage of the business in a certain market that is captured by product or service
the organization provides Market share may be an independent business goal punt from
growth. For example. Smithfield Foods, through its merger with Shuanghi International
almost immediately achieved a massive share of the Chinese pork market.
One company that has traditionally put a great deal of emphasis on attaining market
share goals is Google Corporation. Indeed, in its carly years, Google was so intent on captur
ing
cfforts in this regard (in contrast to many other start-up Internet companies), though, have
carch engine market share that it really didn't care about making any profits. Google
dearly paid off. Today it has over
a 66 percent share of the search engine market in the
United States and close to an astounding 70 percent share worldwide. In this regard. Google
bas clearly left competitors like Microsoft and Yahoo in the dust."
There is, however, one very important concern that global businesses need to keep in
mind when establishing high market share output control measurements antitrust law. As
discussed in Chapter 6, antitrust law is concerned about anticompetitive concentrations of
business power (eg., monopoly or oligopoly power) and very high business market shares
can be one indicator of such power. Indeed, because of its extraordinary success in captur-
ing market share the Google Corporation has in recent years been the subject of various
US Department of Justice and Federal Trade Commission antitrust investigations. So, if a
global company decides to make market share an important output measure it's very im
portant for that company's lawyers to provide it with a clear understanding of the potential
antitrust implications of taking that approach.

9-4-3e Quality/Six Sigma Initiatives Many global businesses put a very strong
emphasis on quality and then seek to measure and control for this output. Quality may apply
to product, customer service, or both. For example, and as noted earlier in the chapter, the
Starbucks Corporation cares a lot about the quality of its coffee and the cups of coffee it sells
to the general public around the globe.
One interesting type of quality control function that has received a good deal of atten
tion in recent years is that of six sigma initiatives. Technically speaking, these are organi-
zational initiatives that seek to limit defects or problems to 3.4 per million.
Statistically
the term "sigma" measures how far a given problem deviates from a given norm, and a si
sigma procedure is one that barely deviates from perfection.
Let's say, for example, that a major international airline handles three million pieces of
passenger luggage per year and has about 50,000 pieces of lost or temporarily misplaced
luggage per year. It could adopt quality control measures that reduce lost-misplaced lug:
gage to only about 20,000 pieces per year, but the airline is not happy with this-it wants
to do more. An effective six sigma program would reduce the number of lost or misplaced
pieces at the international airline to about ten per year! Is this a realistic goal? And if it can
be achieved, what are some reasonable alternatives (c.g., a successful initiative that would
reduce lost or misplaced luggage at the global airline to about 2,000 pieces per year)?
9-4-3f Corporate Social Responsibility As discussed earlier in the chapter, some
global businesses take more of a "stakeholder" approach to strategy formulation, giving back
the communities where they do business is an important output they may want to measure
and control. For such companies, corporate social responsibility (CSR) is an important
output control. Google Corporation's corporate motto is "Don't be Evil and the company
has committed literally hundreds of millions of dollars from both its initial public stock otfering and its
ongoing profits to a variety of CSR initiatives in Individual communities and
on the global stage In particular. Goode has been very active in contributing and to public
health and environmental programs and cause
Of course, not every global business is an active as Google on the corporate sociale
sponsibility front. That said, a wide variety of annual survey and award lies have emerged
in recent years that rank companies by the level of their activities and contributions to com
munities, to the environment, and the like. Vor a number of global businesses, achieving
higher ranking on these surveys has become an important and measurable output sal
Moreover, in some industries, government entities formally score businesses with
spect to their CSR activities. For example, pursuant to a US banking law called the Com
munity Reinvestment Act (CRA), all banks in the United States receive annual grades
(excellent, satisfactory, or unsatisfactory) from federal banking regulators with respect to
their community reinvestment and CSR activities. These activities involve banka having
branches in low-income areas and making loans to low-income individuals. They may also
involve bank monetary donations to charities and charitable activities in the communities
in which they operate. Banks work hard to receive at least a satisfactory' CRA grade, since
banks with a lower grade might face negative regulatory consequences
REALITY CHECK LO-4
What do you think is a good output control and measurement for the professor in
this class?
L
A
OGO
P
9-5 Organization Culture and the
Change Control Function
Organizational culture, as discussed earlier in Chapter 3, represents the personality of
a given organization, its shared norms and values. Organizational culture can be a very
effective control mechanism for an organization, particularly when the norms of a given
business's culture are fully accepted by that organization's workforce. Very often, however,
such norms are not fully accepted, and this can pose a challenge to organizational control.
To meet this challenge, an organization may seek to change its culture.
a
9-5a Types of Organizational Culture
If a global business has a strong and accepted cultural norm of employees doing only
the highest quality work, it may not be necessary for supervisors to constantly monitor
employee's work quality. As an example, for generations there has been a cultural norm
of "highest quality journalism" at the New York Times newspaper. In this organizational
con the newspaper's reporters don't require close supervision to do great journalis-
tic work-the reporters' pride in being journalists at arguably the best newspaper in the
United States will operate as an automatic kind of internal control mechanism motivating
them to do very high-quality work.
Similarly, Google Corporation's "Don't Be Evil" motto contributes to the organizational
culture by creating an overall norm for ethical behavior at that company. Put another way,
there's social pressure on Google Corporation's employees to act in an ethical manner, and
this social pressure acts as a control system apart from any formal rules and regulations.
On a less positive note, convicted financial swindler Bernard Madoff created a cocaine-
fueled "culture of sexual deviance" at the BMIS (Bernard Madoff Investment Services)
company he once headed, according to a lawsuit filed in October 2009 by former Madoff
investors. From the mid 1970s up until the company's demise over 30 years later, Madoff