Feasibility Study: Go/No Go Decision
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Feasibility Study: Go/No Go Decision
Executive Summary
Ford Motor selected an individual to study the feasibility of conducting business in a developing country of the latter’s choice. Kenya was chosen. Various aspects of the country, including the culture as well as the labor conditions were taken into account. The committee was expected to present its findings in a report to be submitted to the management of Ford Motor.
Among the key findings in this report are those on the cultural attitudes towards women, educational level of Kenyan workers, values and attitudes, religious customs, as well as the physical environment. It was established that women are considered inferior, and society does not believe they can show commitment in any job. They are seen as members of society who only fit in household chores such as taking care of children and cooking. The values the Kenyan society hold were concepts such as the institution of marriage and family, respect for other people’s property, as well as a dignified life. Concisely, the cultural practices in Kenya were not favorable enough for the efficient running of a business.
Findings on the conditions of labor showed the value Kenyans attach on safety and fairness at the place of work. The labor laws were clearly enquired and presented in this report. They appear strict and draconian to business enterprises. The recommendation was that Ford Motor should not conduct business in Kenya because the environment is not suitable for such an enterprise.
Introduction
Kenya was top in the list of the locations the team considered and was offering global companies attractive business and investment opportunities. Nevertheless, conducting business in Kenya involves navigating the complexities arising from the unique political, cultural, and economic contexts. In spite of the challenges, Ford Motor considered conducting business in the country. The team thought collaborative relationships with Kenyan stakeholders existed, and the company was likely to succeed if it demonstrated the ability to adapt its strategies to the dynamic environment. In addition, Kenya’s adoption of business strategies that foster trade and entrepreneurship was seen as an incentive for global companies to do business.
Findings
In the report, an analysis of cultural practices and labor conditions that apply to a business during its life cycle will be made. Though the aggregate ease of conducting business should ideally include a number of economies and based on several indicators, this report does not consider all business environment aspects that might be of interest to Ford Motor (Leslie & Webster 23).
Culture
Women are considered unable to work in high profile jobs. They are seen as weak figures in society who cannot perform tasks that require a lot of skills and thinking. They are relegated to simple kitchen chores and require being under the authority of their husbands all the time. In addition, most women have extremely low educational qualifications. Only a few can provide high skilled labor in an industry. Another issue of major concern is gender violence. In Kenya, gender violence has been directed towards women even in their places of work. This, apart from influencing adversely on their dignity as human beings affect their performance as the embarrassment it causes reduces their commitment to the organization for which they work.
At times, women themselves have been the force that hinders their progress. They have refused to debunk the idea that they have to limit their ambitions in order to be good caretakers of their children and husbands. Consequently, many Kenyan women are adamant in applying even for unskilled positions such as those of cleaners and storekeepers that global companies are willing to offer to the semi-skilled and unskilled Kenyan labor market (Crowther & Guler 41).
The children are not left behind as far as oppressive cultural attitudes are concerned. However, societal oppression of children mostly affects the girl child. She is expected to assist her mother in childhood chores, to enable her take up family responsibilities smoothly at the time of marriage. When the period of helping her mother with housework is over, the girl child is married off forcibly to a man of the parent’s choice. This is extremely common in many Kenyan communities. In her new home, the girl is expected to assume marriage and family responsibilities at a tender age. This cuts her dream of a successful life (Iarossi 52).
The report assessed the attitudes of human resource on work-family concerns. The findings were focused on the perceptions of human resource professionals have on issues like childcare, parental responsibility, sex-role stereotypes, impact of family responsibilities on job commitment, as well as the role the Kenyan government and companies play in assisting employees with parental responsibilities. The findings suggested that these concerns might influence the probability of program implementation and work-family policy. In the Kenyan society, work-family conflict apparently affects women more than men as gender influence an individual’s attitudes toward issues of work and family. On examining the responses meant to determine whether there were variations in the attitudes of men and women as human resources, it was found that these cultural practices are commonplace (Kibera 65).
Traditional family roles apparently fall on the woman fully, and society has no problem with this. The cultural attitude towards parental responsibility and childcare is such that this responsibility should be placed on the woman totally. The man should be absolved from this responsibility in order to create time for bread winning. The attitude that leaving children in a day care center is wrong has taken a heavy toll on the economic status of most Kenyan women. Society views the female parent as the one supposed to assume total responsibility for their children without any concern for employment and other work related issues. However, female human resource professionals showed much disagreement with the gender issues and showed a willingness to change the situation with time (Ellis 4).
Cultural attitudes on women career commitment revealed interesting findings. Specifically, the degree of commitment of women to their employment was studied and compared with that of men. Additionally, there were similar findings for the general impact children have on commitment of women to their jobs. Generally, it was found that women are rarely committed to their employment in the Kenyan society. The commitment to work decreases even further after the woman gets more and more children. A deeper inquiry into this issue suggests that non-work issues negatively affect a commitment to employment for women. The degree to which orientation of achievement is perceived to change once a woman gets a child was found to decrease. Contrary to what had been expected, a high score was achieved, meaning the Kenyan society believed that achievement-orientation increased for both men and women after the birth of children (Dorothy 100).
The study of training and education involved an analysis of the Kenyan workers, Ford Motor itself, as well as the economy as a whole. Training and education were singled out as the two major concepts that influenced the wage rates in Kenya. Generally, a well-trained worker tends to earn more money and become more productive than those with poorer training. The finding on the educational level of workers in Kenya was not limited to the highest level of academic qualifications attained. The report also takes into account other training programs in the form of on-the-job training and other apprenticeships, which also influence the availability of a skilled labor force. For a business environment to be considered conducive, the workforce must be capable of operating an industry at a level where it can hold a competitive advantage over other multinational companies. Kenyan government has made a subtle attempt to achieve this: it has been trying to incentivize worker training through the introduction of write offs and tax breaks. In addition, it has provided facilities for worker training and a variety of other ways designed to establish a more skilled workforce. This kind of economy will apparently sustain a competitive advantage for Ford Motor.
Variations in levels of training have been cited as an important factor, which separates the rich and poor developing countries like Kenya. Other factors come in play certainly, including but not limited to available resources and geography, but having more-trained workers may create externalities and spillovers. For instance, businesses similar to Ford Motor may cluster in one geographic location and compete for the few available skilled workers. Kenya has placed a greater emphasis on developing a system of education that will produce workers with the ability to function in Ford Motor partly due to older industries, which are becoming less and less competitive. Additionally, a movement whose aim is to improve the elementary education of the Kenyan population has reportedly emerged. Speaking economically, education does not focus strictly on workers obtaining degrees from college and universities. Relevant education is usually broken into different levels: primary (elementary school), Secondary (middle, high, and preparatory schools), and Post-secondary (vocational schools, community colleges, and universities).
The investigation found Kenya’s proportion of educated workers to be increasing over time. These highly educated workers are considered able to carry out tasks requiring critical thinking literacy more efficiently. Nonetheless, obtaining a high level of education in Kenya carries quite a high cost. Kenya has tried to provide a vast network of universities and colleges in order that it benefits from education. It started with providing fundamental literacy programs in a bit to see economic improvements. Consequently, Kenya has a greater portion of its population graduating from institutions of higher learning. The provision for funding in primary and secondary education has increased. In this sense, Kenya sees education as an investment in human capital (Kibera 84).
Some values in the Kenyan society include the institution of marriage and the family. Employees at times ask for higher allowances based on being family men and women. They may also stay away from work on some days claiming to own young families that require their attention. This affects the services such workers give to the company adversely (Dorothy 45).
About four-fifths of the Kenyan population is Christians, with the Roman Catholic and Anglican Churches being the most established denominations. Other well-established denominations include the Presbyterian Church of East Africa (PCEA), the Seventh Day Adventists (SDA), and the African Inland Church (AIC). In addition, Islam is a major religion in Kenya. Muslims include both the Shiite and Sunni Muslims. A large number of Kenyan Muslims reside in Mombasa and the outlying coastal regions. Muslim, with Nairobi holding traces of Muslims, also predominantly inhabits the northeastern part of Kenya. Findings suggest these religions will not influence the operations of Fortune 500 adversely as their followers do not hold unreasonable dogmas.
There exist a number of traditional African religions. Mungiki is a religious and/or political movement that believes in practicing age-old customs, which may be detrimental to the operations of Ford Motor as explained in the preceding discussion. Mungiki is typically based on reverence to ancestors and natural phenomena. They presume the dead merely transform into other states of being. In addition, they can bring calamities or good fortunes to the living. Consequently, religious rites are centered on appeasing the dead. In a bid to appease the dead, the Mungiki believe they owe society the responsibility of protection and security, and must be paid for their services. Since no one is ready to pay a criminal organization, the group extorts illegal taxes from large business enterprises (Maina 4). Ford Motor should be wary of this, as it is a potential victim of such extortion and security threat. Findings showed evidence that there was an incident when the Mungiki forced all business enterprises in Murang’a, Nyeri, and Nakuru counties of Kenya to remain closed for over a week ("Gang violence threatens” 11).
The political situation has been quite stable since the colonial days, but the 2007/2008 post election violence made parts of the country volatile. While this may appear as mere ethnic clashes, entrepreneurs whose businesses were disrupted completely understand the implications of a volatile country (Maina 4). The situation is a deterrent to Ford Motor’s proposal to conduct business in Kenya. There will also be competition from both the local and international firms. For instance, Toyota Kenya and Thika Motor Dealers will launch a stiff competition. The competition will most likely not be favorable, as the Kenyan market prefers automobiles from the highly innovative Toyota and Thika Motor Dealers (Best 2).
Labor Conditions
Kenyan society emphasizes safety and fairness on termination and dismissal does not favor Ford Motor. The law provides that a worker whose contract has been terminated to get payment for every year he or she worked. Furthermore, the employer has to justify any terminations of employment. Kenyan parliament recently introduced the concept of an unfair dismissal in this law. The law is likely to impact negatively on Ford Motor because it might want to dismiss a non-performer but lack the legal basis justly to do so. Additionally, there is a prohibition of discrimination in recruitment based on race, sex, political opinion, language, and religion, nationality, and HIV status. Ford Motor usually does not discriminate on any of these bases, though there is a natural tendency by any given company to avoid recruiting people with advanced HIV/AIDS. Since the law is very precise on this aspect, it is likely to affect Fortune 500 companies in one way or the other.
In the labor laws, issues concerning payment, recovery and disposal of employee’s salaries, allowances, and deductions are included. There is a clause that an employer is prohibited against deducting more than two thirds of a worker’s wages. The law of most countries where Ford Motor operates does not have such a clause. The Ford Motor will most likely not feel comfortable with this law as its deductions may exceed the required minimum at times. Furthermore, every worker in Kenya is entitled to an itemized pay slip. Fortunately, this is what Ford Motor has practiced for decades and may not feel pressed by such a provision (Kibera 5).
In Kenya, there is a large pool of semi-skilled workers and smaller number of highly skilled workers. Ford Motor wants highly productive workers who do not require much management. Leslie and Webster (2012) emphasize that companies should consider some factors when deciding on whether to pay for the training of their employees. For instance, the training program may increase the workers productivity and command a higher wage. While Ford Motor ought to be wary about the departure of newly trained workers, the company may require workers to continue with them for certain duration in exchange for the management paying for their training. There is also a possibility the company may face workers who are not willing to accept the training. The worker’s unions are extremely powerful in Kenya. The increasing job security could lead to the process of hiring trained professionals while firing less-trained ones. Nevertheless, the unions are likely to negotiate with Ford Motor to make sure its members are given better training, reducing the likelihood of professionals being imported (Mbugua & Sang 4).
Conclusion and Recommendations
Various aspects of Kenya were analyzed in an attempt to establish whether it was ideal for Ford Motor to conduct business. Among the aspects studied were culture and labor conditions. The attitudes of the Kenyan society towards women and children showed a population with whom it would not be easy to work. Findings on the educational level, values and attitudes, as well as religious customs have been described in detail.
As far as labor conditions are concerned, safety and fairness has been found to be extremely important in the Kenyan society. Kenyan workers will refuse to work unless they are employed without discrimination, and their dismissal is fair. The provisions of the labor laws were found to be quite strict, and it would not be wise for the company to commit itself in adhering to all those regulations, some of which are unnecessary. Lastly, the Kenyan labor market was satisfactory for the company, but the workers would require further in-service training to make them relevant to the changing needs of the market.
On careful analysis of the aforementioned aspects, Ford Motor should not conduct business in Kenya. Despite the efforts the Kenyan government has made to create an enabling business environment, there is still a lot that needs to be improved.