...Jextra Neighbourhood Stores in Malaysia A Critical Analysis Sharon D. Doherty-Ritter UMUC AMBA 660 Professor Mike Shin Introduction Jextra Stores is a large Asian grocery retailer based in Hong Kong, China and is owned by Sin Lim Holdings, a large publicly traded industrial group. Jextra operates supermarkets, hypermarkets, and convenience stores in Hong Kong, China, Philippines, Viet Nam, Malaysia, Thailand and Singapore. Jextra entered Malaysia, a stable and prosperous nation of 28 million multi-ethnic people in 2005 using the name Neighbourhood Markets. Tom Chong has been the country manager for Malaysia for eight months (after holding various positions for Jextra in corporate headquarters and two years as Finance Director in Malaysia). After several successful months as country manager, Chong is currently facing two major issues in his role as country manager. The first issue is with the Mayor of Klang (a town located about 30 km west of Malaysia’s capital) who is willing to make it possible for Jextra to expand to Klang if Jextra would finance a new primary school. The second issue has to do with the job performance of Jextra’s top-performing buyer of fruits and vegetables, Arif Alam who maybe taking gifts or accepting bribes which is against the Jextra Business Conduct Code. Chong also suspects Alam of a scheme between Alam and his father-in-law whereas the father-in-law ran a trading agency that potential suppliers would have to go through to...
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...For the exclusive use of M. Hossain rP os t TB0249 Andrew Inkpen Jextra Neighbourhood Stores in Malaysia op yo In October 2010, Tom Chong was on his way to his office and thinking about several issues he would have to deal with in the coming weeks. Chong was Jextra Stores (Jextra) country manager for the Neighbourhood Markets Division in Malaysia. One issue involved a conversation with the mayor of Klang, a town near Malaysia’s capital city of Kuala Lumpur. Chong had been seeking to expand to Klang for some time. The mayor surprised Chong with an offer to help with land zoning if Jextra would help finance a new primary school (or at least Chong thought that was what he had been asked for). The second issue involved the job performance of Arif Alam, Jextra’s top-performing buyer. Alam, a buyer of fresh fruit and vegetables, consistently negotiated better contracts than Jextra’s fifteen other buyers and, Chong believed, better than Jextra’s competitors. The contracts negotiated by Alam certainly contributed to the excellent financial performance of Jextra Malaysia. Nevertheless, Chong could not help wondering if there was more to the picture than he was aware of. The retail industry in Malaysia was notorious for buyers accepting money and gifts from suppliers. A few days ago, Chong had accidentally overheard two of his accounting employees speculating that Alam must be accepting gifts, or even taking bribes—how else could he get such good contracts...
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...Harvard Business School: Jextra Neighborhood Stores in Malaysia Introduction Tom Chong has several issues he needs to deal with in couple of weeks; however, some issues are more critical than others so he has to handle them accordingly. Chong has two major issues that must be resolved: one of the issues is a recent conversation between him and the mayor of Klang, a town in which Jextra would like to build a new store. The mayor informed Chong that Jextra's application approval process for rezoning would speed up if Jextra will support a new primary school building in Klang. The mayor also wants Jextra to help pay for a flyover at the road intersection near the proposed store site. Should Chong invest Jextra’s money in those projects? Chong's other issue involves the job performance of one of his category managers, Arif Alam. He is one of the top performing managers at Jextra. Chong could not stop wondering if Alam is accepting money and gifts from Jextra’s suppliers. Although Chong has no proof that the manager is acting inappropriately, there are many rumors floating around Jextra's office. Should Chong investigate Alam? By the way, who is Tom Chong? Tom Chong is the country manager in Malaysia for Jextra Stores (Jextra), a large Asian supermarket retailer based in Hong Kong and owned by Sim Lim Holdings – a large publicly traded industrial group. The company Jextra, operates ten Neighborhood supermarkets in Malaysia. This paper is to analyze how Chong will eradicate...
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...| | | Jextra Neighbourhood Stores in Malaysia By Nichole Williams, AMBA660, January 22, 2013 | | | Introduction This analysis consists of the issues of bribery and business deals that are direct conflicts of interest facing Jextra’s country manager for the Neighbourhood Markets Division in Malaysia, Tom Chong. During this analysis the areas of social ethical and legal challenges, how Chong should address the issues, should managers be held accountable for corruption, where to go for guidance if these matters where to arise in your company and lastly; recommend steps for Jextra to help build its corporate culture for the long term benefit of the company. What are the major social, ethical, or legal challenges that Jextra faces in operating in Malaysia? Are these the kind of issues Chong should have anticipated as a country manager? The major social, ethical and legal challenges that Jextra faces while operating in Malaysia include bribery and conflicts of interest. The issues that Jextra is facing are not uncommon in international business, and as a country manager Chong should anticipate these types of issues to as well as other legal issues that include product safety and liability, marketing practice, rule of origin, jurisdiction, and intellectual property protection when conducting international business as described in DRS. (pg 129) How should Chong resolve the requests from the mayor of Klang? Resolving the request from the mayor of Klang is a...
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...Jextra Neighborhood Stores Case Analysis This report analyzes the ethical dilemma faced by Jextra’s country manager, Tom Chong, who was responsible for Neighbourhood Markets in Malaysia. Jextra Stores was a Hong Kong based company that operated retail stores in China, Hong Kong, Philippines, Malaysia, Thailand, Singapore, and Vietnam. In 2005, the company successfully entered Malaysia, operating supermarkets under the name of Neighborhood Markets (Inkpen, 2010). Jextra identified a promising site in Klang, near the capital of Kuala Lumpur, to open a new supermarket (Inkpen, 2010). Mr. Chong needs to evaluate a proposal made by the Mayor of Kang, which might be considered bribery. In this case, Mr. Chong faces social and ethical challenges that may affect the company’s operations, performance, and competitiveness in the region as well as Mr. Chong’s career. The major social issues include those related to law, culture, and ethics. The report also analyzes anti-bribery corruption enacted by the U.K Bribery Act and the U.S. Foreign Corrupt Practices Act (FCPA). The report concludes with recommendations to Jextra such as seeking proper legal advice, implementing an effective business code of conduct, providing inter-cultural and ethics training to managers, using a geocentrism approach and conducting an internal investigation for the Malaysian category manager. Analysis Social, Ethical, or Legal Challenges International firms operating abroad often face social challenges...
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...Jextra Neighborhood Stores Case Analysis This report analyzes the ethical dilemma faced by Jextra’s country manager, Tom Chong, who was responsible for Neighbourhood Markets in Malaysia. Jextra Stores was a Hong Kong based company that operated retail stores in China, Hong Kong, Philippines, Malaysia, Thailand, Singapore, and Vietnam. In 2005, the company successfully entered Malaysia, operating supermarkets under the name of Neighborhood Markets (Inkpen, 2010). Jextra identified a promising site in Klang, near the capital of Kuala Lumpur, to open a new supermarket (Inkpen, 2010). Mr. Chong needs to evaluate a proposal made by the Mayor of Kang, which might be considered bribery. In this case, Mr. Chong faces social and ethical challenges that may affect the company’s operations, performance, and competitiveness in the region as well as Mr. Chong’s career. The major social issues include those related to law, culture, and ethics. The report also analyzes anti-bribery corruption enacted by the U.K Bribery Act and the U.S. Foreign Corrupt Practices Act (FCPA). The report concludes with recommendations to Jextra such as seeking proper legal advice, implementing an effective business code of conduct, providing inter-cultural and ethics training to managers, using a geocentrism approach and conducting an internal investigation for the Malaysian category manager. Analysis Social, Ethical, or Legal Challenges International firms operating abroad often face social challenges...
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