Regular readers may remember a guest-post back in July about the Gulf of Mexico oil spill. Tom argued that BP might well be copping a disproportionate amount of blame for the disaster, while lesser partners were getting off lately. We described this as an instance of diseconomies of scale.
The Wall-Street Journal raised a further example last week (click through from this link for the full version of the article).
The article argues (and some trade union officials admit) that the world’s largest retailer Wal-Mart receives excessive scrutiny for its labour practices (i.e. it’s non-union status, low pays, miserly health benefits etc), while counterpart Target (the US firm, not the Aussie one) get off very lightly, despite having very similar employment conditions.
This manifests as a genuine disadvantage for Wal-Mart as public campaigns against new stores (especially in large cities) restrict expansion.
Meanwhile, Target appears to be deliberately, well, targetting the same neighbourhoods conscious of the lack of scrutiny, the perception of being the ‘lesser of two evils’, and the limited resources of campaigners.
Building such disadvantages into our understanding of competitive advantage, firm growth, and bargaining power seems increasingly important.
Tags: Anadarko, bargaining power, BP, business, business strategy, campaigns, competitive advantage, finance, labour rights, Oil spill, retail, Retailing, Strategic management, Target, Tom Osegowitsch, unions, Wal-Mart