SHERWOOD HOCKEY STICKS- Global Sourcing Harvard Case Solution & Analysis

 SHERWOOD HOCKEY STICKS- Global Sourcing Case Solution

Problem Identification

Sherwood has been facing several problems / challenges prevailing in the hockey stick industry, which are as listed below:

Decrease in market share:

Sherwood’s market share has been declining for its high end, high priced, one piece composite hockey sticks with the passage of time. This could be due to poor quality of composite hockey sticks as compared to competitors involved in the marketplace. Similarly charging a high retail price is not attractive for the customers because customers switch between brands, and prefer those who are offering a low price. Moreover, Sherwood is not providing a better margin for retailers and as a result retailers would not be promoting Sherwood products. Thus, sales are also declining because customers are not satisfied with the offerings of Sherwood.

Shifting of production facilities to China:

As Chinais a production hub in the world just due to cheap labor, Sherwood was planning to set up its production facilities in China but this was not easy as a lot issues had to be dealt with. Firstly, it would be time consuming and difficult to manage the shifting process because of the tax regulation existing in China, similarly heavy investments had to be made in the shifting process of production facilities and equipments necessary for production. This would incur a lot of costs which is not a favorable decision pertaining to the current situation of the business. Hence, they had to send experts to China for setting up machinery and guidance for the manufacturing team, which is again costly and time consuming.

Layoffs:

Sherwood had conducted several layoffs;around 40 employees were fired and no replacement had been made by the company which indicates that they were downsizing as expenses were exceeding and that the company was not able to overcome the expenses, which is why it had made a decision to lay off its employees. Furthermore, the company was confused about how to tell the general public and convince them on such an issue. This would even affect the brand image of the company and a negative word of mouth could be given by the customers and the employees who have been fired by the organization.

Analysis Based on Theories

National culture theory

National culture theory consists of six dimensions which are as followed:

1. Power distance

This dimension communicates the extent to which the less powerful individuals of a society acknowledge and expect that power is distributed unequally in the society. The issue here is how a society manages inequalities among individuals. Individuals in social orders showing a substantial level of Power Distance acknowledge a various leveled request in which everyone has a spot and which needs no further justification.

2. Individualism versus collectivism

The high side of this dimension, which is known as individualism, can be characterized as a preference for a loosely knit social system in which people are required to deal with just themselves and their families. It is opposite, collectivism, represents a preference for a tightly knit framework in a society in which people can expect their relatives or individuals from a specific in-group to care for them in return for unquestioning loyalty.

3. Masculinity versus femininity

The Masculinity side of this dimension represents an increase in the public for achievement, heroism, emphatically and material rewards for achievement. Society everywhere is more focused. However, feminism prefers participation, modesty, care for the weak individuals and quality of life. The larger society is more oriented towards consensus. In business terms Masculinity versus Femininity in some cases is related to as "strong versus tender" societies.

4. Uncertainty avoidance

The uncertainty avoidance dimension indicates the extent to which the individuals from a society feel uncomfortable with uncertainty and ambiguity. The key issue here is the means by which a society manages the way that the future can never be known and whether we should attempt to control the future or simply let it happen....................

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