...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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...the newly appointed Malaysia country manager, has been promoted into animportant leadership role within the international chain of Jextra grocery stores. Chong isresponsible for the oversight of all operations in Malaysia and has been instructed to pursue a strategy of “aggressive growth” within this budding market.After eight months of employment,Chong begins to discern an undercurrent of unethical behavior surrounding Jextra and is forcedto contemplate what actions if any he will take to address two precarious situations. Chong’s initial concerns pertain to his meeting with the mayor of a Malaysian town called Klang, which is located near the country’s capital. Klang is not yet zoned for commercial purposes, but otherwise represents a seemingly perfect location for expansion. During a meetingregarding this potential store site, the mayor proposes that Jextra should contribute to a local primary school fund and incur some of the costs associated with road and electricitydevelopment near the Klang lot. Chong is unsure about the legality and logistics of these requested donations, and he doesn’t know if they are a prerequisite to gaining zoning permission. His suspicions are further aroused when he learns that the mayor’s sister is the leading championof the primary school fund, and that the road development planning was underway months before Jextra expressed interest in breaking ground in Klang. According to Jextra’s Business Conduct Code, “it is illegal to pay or receive a bribe...
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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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...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 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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...Case Summary & Analysis Jextra Stores, a large Asian retailer, based in Hong Kong was planning to enter the Malaysian convenience store sector. Jextra appointed Tom Chong as Malaysia country manager, who has been promoted into an important leadership role within the international chain of Jextra grocery stores. Chong is responsible for the oversight of all operations in Malaysia and has been instructed to pursue a strategy of “aggressive growth” within this potential market. After eight months of employment, Chong begins to encounter an undercurrent of unethical behavior surrounding Jextra and is forced to anticipate what actions if any he will take to address two unjustified situations. Chong’s initial concerns pertain to his meeting with the mayor of a Malaysian town called Klang, which is located near the country’s capital. Klang is not yet zoned for commercial purposes, but otherwise represents a seemingly perfect location for expansion. During a meeting regarding this potential store site, the mayor proposes that Jextra should contribute to a local primary school fund and incur some of the costs associated with road and electricity development near the Klang. Chong is unsure about the legality and logistics of theserequested donations, and he doesn’t know if they are a prerequisite to gaining zoning permission.His suspicions are further aroused when he learns thatthe mayor’s sister is in the school board and major supporters of primary school fund, and that the road...
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...The Jextra Neighborhood Case Study George Koduah AMBA 660 Instructor: Dr. David J Pritchard April 23, 2013 Introduction The Jextra Neighborhood case study is an attestation of the growing effort by Multi National Corporations to extend their operational base to take advantage of the increasing benefits associated with globalization, a phenomenon that involves ‘cross border trading among nations and customers’ (Daniels, Radebaugh, & Sullivan, 2013). The case highlights the managerial capabilities and style of the Manager, Tom Chong; the cultural variations in the perception of business as an entity and its relationships with society, employee attitude to work ethics, and legal variables governing the operations of international corporations. The Malaysian system poses a socio-ethical dilemma especially with the giving and receipts of bribes by appointed employees as well as the exchange of favors (or request thereof) between government officials and businesses (Inkpen, 2010). The legalities of such operational antecedents can have adverse international legal implications from enacted laws such as the UK Bribery Act and US FCPA ("Arnold & Porter Advisory," March 2012) on organizations involved. Analysis Major social, ethical or legal challenges As a foreign company, Jextra faces a host of social, ethical and legal challenges in its operations. The social culture of Malaysia does not have a strict demarcation between business and social relations. Thus, employees...
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...JEXTRA NEIGHBOURHOOD STORES IN MALAYSIA NURULSAKILA BINTI JAFRI MBS141092 BUSINESS ETHICS, RESPONSIBILITY AND SUSTAINABILITY MRAA 1533 LECTURER: DR JIHAD MOHAMMAD 4TH APRIL 2015 ------------------------------------------------- Question 1: How should Tom Chong resolve the request from Mayor of Klang? Tom Chong is in dilemma. He is very ambitious in penetrating the market and expanding Jextra in Malaysia. He believed Malaysia has plenty of growth opportunities for supermarkets investment despite various challenges that need to face. In order to accomplish his goals, he prepared an aggressive five-year investment strategy and identified Klang as the potential site for new Neighborhood Market. It was however, Mayor of Klang suggested that the application for zoning Jextra would be more likely to be approved if Jextra supporting new primary school and financing flyover. Bribery can be defined as the offering, giving, receiving, or soliciting of something of value for the purpose of influencing the action of an official in the discharge of his or her public or legal duties (Bribery, 2008). The truth is Chong knew supporting new primary school and flyover is a bribe to obtain the permit and is illegal either in Malaysia or Hong Kong. Nevertheless his desire to develop the business within short time wavered his decision making. As a Country Manager, Chong should have very clear about Jextra’s Business Conduct Code in which no bribery is allow to obtain or retain the business...
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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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