At the most recent strategy session, the CEO of Pegasus, Tom Oswald, and division managers of the Wireless Division decided that they would like to expand into China. Through the team’s initial research, it indicates that China is likely to develop into a profitable market for wireless. In conjunction, the government has made spending on wireless a priority as an added incentive to pursue this venture. The extreme expenses of burying communication cables make wireless the most optimum solution. Additionally, copper wires are used for the buried cables, which tends to a lucrative business to steal the copper cables and sell it in the black market.
Although it seems like a “no brainer” for the Chinese to enter into the market, extensive research has raised red flags for doing business in China. In order to conduct business, Pegasus would have to obtain licenses, and typically, a “payoff” is required to acquire them. Typically the “payoff” occurs when a company contracts an agent to represent them in the country and to obtain the license. What the contractors do is their own business; as the CEO of the respective company signs a disclosure statement, stating that they know of no instance where they bribed for their business. This leaves Pegasus faced with the decision to pursue the potentially risky wireless business venture in China or to find a different market.
There are numerous stakeholders in this situation in this operation, which can be broken up into two groups: internal stakeholders and external stakeholders. Beginning with the internal stakeholders, the first and most important would be CEO, Tom Oswald. Considering the fact that he is the Chief Operating Officer, he is in charge of total management of Pegasus. Ultimately the decision lies on his shoulders. Next, would be the Wireless Division, which includes the division managers and employees in that division. If this deal does go through, the stock in the company would increase exponentially. Not only would the employees in the Wireless Division gain an increase in stock, but also all the employees at Pegasus would see an increase due to the overall company’s success.
In addition to the internal stakeholders, the external stakeholders in this case are numerous. At the forefront would be the suppliers. With an increased projection of almost $100 million in business per year, the demand for supplier would drastically increase. With an always preferred growth increase, this decision would definitely affect the local community as it increase the number of jobs and bolster the local economy. In conjunction with the growth in the community, it would affect distributers as well. The greater the distribution, the greater the channels are of reaching the most beneficial recipients and stakeholders of the product, the customers.
The managers at Pegasus have done in depth researching both the pros and cons of bringing their company’s wireless products and services into...