WG is one of the world’s leading makers of mobile phones, with market share of approximately 20%.Unlike any of its major competitors, it is based in Narnia, a high-cost, developed country. Narnia has very limited natural resources, but has developed significant expertise over the decades in high-end precision engineering and efficient use of materials. WG is quoted on the Narnian stock exchange, where it is the largest company by market capitalisation. It has a wide shareholder base including most Narnian

institutional investors and private individuals. Its largest three shareholders are institutions who each own around 2% of the company.WG was founded in the 1960s to make telephone equipment and in the 1990s managers made a strategic decision to focus on the then-tiny mobile phone market. This was partly attributable to the Narnian government being among the first to fully deregulate their telecoms market, which lead to lower call costs. Narnia and its neighbouring countries are also fairly rural, and its populations were enthusiastic early adopters of mobile phones. WG was given a particular boost in 1995 when the transmission standard they had pioneered was adopted as the basis for calls by the government in Narnia and many other governments around the world.

Serving a rapidly growing market, WG quickly gained economies of scale that allowed cheaper production than competitors emerging later. WG then exploited these to open up export markets all over the world,enhancing their advantage further.

Unlike many of its competitors, who subcontract their manufacturing to others, WG assembles most of its own handsets. Its factories are mostly in Narnia, where it benefits from the highly educated population and the presence of high-quality local suppliers to carry out increasingly high-tech manufacturing processes. Narnia has very good communication links, which helps suppliers to deliver rapidly.

Technology is advancing all the time and WG regularly launches new, more sophisticated devices, most recently a suite of smartphones. However, the fastest-growing demand is for cheaper, basic models which just carry out voice calls and text messaging. This demand is driven by users in developing countries, who are concerned to keep costs down, but also want the status of using a well-known brand such as WG. WG has invested significant resources in building up a local sales presence in these markets, which allows it to spot trends and produce phones tailored to local tastes and languages.

Competition in the industry is intense, and has become more so due to a recent global economic downturn. The Narnian government has also announced new anti-pollution measures that will result in large-scale manufacturers having to pay more than previously to dispose of their waste products. Shortly afterwards, WG announced that they will increase the proportion of handsets manufactured in lower-cost countries from 15% to 40% over the next three years. Component manufacturers announced plans to follow them to the new locations. This will involve cutting over 1,000 jobs in Narnia. A spokesman for the

Narnian government called the decision “disappointing”. A trade union official said,

“WG has increasingly been putting pressure on its suppliers to lower costs and respond more quickly to market fluctuations. This has made it unprofitable for them to operate in Narnia and lead to decisions like this”.

Required: (a) Analyse WG’s environment using two appropriate models SWOT , 5 forces of Porter

(b) Discuss the main stakeholders in WG and how management could try to retain their support as it seeks to reduce costs.

The Boys of Summer

Which baseball league has had the best hitters? Many of us have heard of baseball greats like Stan Musial, Hank Aaron, Roberto Clemente, and Pete Rose of the National League and Ty Cobb, Babe Ruth, Ted Williams, Rod Carew, and Wade Boggs of the American League. But have you ever heard of Willie Keeler, who batted .432 for the Baltimore Orioles, or Nap Lajoie, who batted .422 for the Philadelphia A’s? The batting averages for the batting champions of the National and American Leagues are given on the CourseMate Web site.

The batting averages for the National League begin in 1876 with Roscoe Barnes, whose batting average was .403 when he played with the Chicago Cubs. The last entry for the National League is for the year 2010, when Carlos Gonzalez of the Colorado Rockies averaged .336. The American League records begin in 1901 with Nap Lajoie of the Philadelphia A’s, who batted .422, and end in 2010 with Josh Hamilton of the Texas Rangers, who batted .359. How can we summarize the information in this data set?

Questions to be answered in your report –

1. Use MS Excel, MINITAB, or another statistical software package to describe the bat- ting averages for the American and National League batting champions. Generate any graphics that may help you in interpreting these data sets.
2. Does one league appear to have a higher percentage of hits than the other? Do the batting averages of one league appear to be more variable than the other?
3. Are there any outliers in either league?
4. Summarize your comparison of the two baseball leagues.

Case Study I

HAIER’s foray into International Markets :

In the late 1990s, the Haier group (Haier) was the leader in the Chinese consumer appliances market (with a 39.7%, 50% and 37.1% market share in refrigerators, air-conditioners and washing machines respectively in December 1998). But deflation in the Chinese economy slowed sales.

ut deflation in the Chinese economy slowed sales growth from 50% in 1998 to around 30% in 1999. Haier decided to look for new markets. Since the US had a large demand for consumer appliances, Haier entered the US market in 1999. Analysts were doubtful about Haier's acceptability to American consumers, as there was a general perception in the US that Chinese goods were of low quality. Haier, however, was confident that with its product differentiation strategy it would be able to create a positive image for its products among the American public. In the early 2000s, the consumer appliances market in the US started hotting up as Haier entered the market. By 2009, Haier products were sold in 9 of the 10 top retail chains in the US.

With Wal-Mart agreeing to stock Haier products, many analysts believed that Haier would be able to shake up the US consumer appliances market. In 2009, Haier had a 6% market share in the US refrigerator market; it stated that it was aiming for a 15% market share by 2015.

The history of Haier dates back to 1984 when Ruimin Zhang (Zhang), a bureaucrat with the local government was asked to take charge of Qingdao General Refrigerator Factory, a state-owned enterprise that is manufacturing refrigerators for sale in China. When Zhang took over the management, the company was on the brink of bankruptcy, with no funds to pay the salaries of its employees or to invest in new product development. When Zhang took charge of the company, he realized that the company did not look after the quality of its products; nor did it bother about customer satisfaction. In 1985, Zhang started importing technology from a German firm and began manufacturing technically sophisticated refrigerators.

Zhang emphasized the elements of customer satisfaction and quality control in the company. In 1985, when a customer complained about the poor performance of his refrigerator, Zhang conducted a quality check and found that out of 400 refrigerators inspected, 76 were defective.

He had all the defective refrigerators destroyed with a sledge-hammer. According to Zhang, this made the workers realize that quality is of only two types - acceptable and unacceptable. In 1989, the company changed its name to Qindao Refrigerator Co. Ltd., and it was restructured with funds raised from banks and government agencies. In 1991, the company once again changed its name to Qindao Haier Group Co. and in the same year it merged with Qingdao Air-conditioner Plant and Qingdao Freezer General Plant. In 1992, the company set up Qingdao Freezing Equipment Co. In the same year, it merged with another previously state-owned enterprise Qingdao Condenser Factory, which manufactured refrigerator condensers.

In the same year it became the first company in China to get ISO 9001 certification, and the company's name was changed to the Haier Group. In 1993, Haier went in for an IPO of RMB 50 million and got listed on the Shanghai Stock Exchange (SSE).

During the mid-1990s, Haier began to grow through mergers and acquisitions. In 1995, it merged with Red Star Electric Appliance Company (and five of its subsidiaries). This company manufactured washing machines. It also acquired Wuhan Elec-appliance Co., which manufactured freezers and air conditioners. Between 1995 and 1997, Haier acquired seven companies and started exporting its goods to foreign markets.

By 1997, Haier was the number one consumer appliances brand in China and the market leader in all its product segments, which included refrigerators, washing machines, microwave ovens and freezers and its revenues were reported at $1.15 billion (10 billion Yuan)...

Haier's Competitors in the US Market

USA was the world's largest and most competitive market for consumer appliances. The consumer appliances market can be segmented on the basis of products into kitchen appliances and home comfort products. Included in kitchen appliances are products such as dishwashers, disposers, compactors, food preservation appliances, refrigerators, freezers etc.

In the home comfort segment are included products such as room air-conditioners and dehumidifiers. The home appliances market in the US was dominated by American companies, namely GE Appliances (a subsidiary of General Electricals), Whirlpool and Maytag. The only strong foreign player in this market was Sweden's Electrolux. GE Appliances, Whirlpool, Maytag and Electrolux together accounted for around 98% of the 9 million standard refrigerators sales in the US every year. In the 1990s, many Asian players such as LG Electronics and Samsung entered the US market in a big way. The big four companies in the US market concentrated on the high- end market comprising full-size refrigerators and washing machines, since the margins in this segment were high...

Strategies in the US Market

Haier decided to compete with the US brands on the quality plank rather than on price. However, analysts felt that it would be very difficult for the company to win over American consumers who associated Chinese goods with low quality. To strengthen its presence in the US market, Haier adopted a localization strategy.

It opened a design center in the Los Angeles and employed US designers for designing its products for the US market. Haier also opened a marketing center in New York. The company focused on enhancing consumer awareness about the company and its products. Commenting on Haier's strategy, Zhang said, "We want consumers to feel that Haier is the one company that comes closest to satisfying their needs." For instance, none of the consumer appliances companies in the US offered a compact refrigerator to satisfy demand from college students who could not afford normal size refrigerators...

Going High-End

Most analysts felt that Haier would feel the real competition only when it entered the high-end market. In the compact refrigerator segment, Haier did not face much competition from established players in the US, who did not focus on the low margin segment.

However, the major US players were keeping track of Haier's activities. Commenting on the competition from Haier, GE Appliances Chief Executive, Jim Campbell said, "I take it very seriously. They may be producing only 200,000 refrigerators per year now, but that's going to get bigger."

On the negative side, some analysts felt that Haier lacked the brand image to make a dent in the high-end segment. They pointed out that in general US consumers were brand-conscious, and this was especially true in the case of high-end products. The lack of a positive brand image in this consumer segment would probably make it difficult for Haier to succeed in the high-end markets. Analysts felt that Haier had an additional weakness in its distribution and service centers...

Future Prospects

Despite a few reservations, analysts too were, by and large, upbeat about the company because of its strong performance in breaking into the American market in a short time.

Said Nicholas Heymann of Prudential Securities, "Over five years, it could become a force." With quality products and lower prices, it was felt that Haier would be able to garner a sizeable market share in the US. Haier's experience in the geographically vast and diversified Chinese market would serve it well in catering to the US market.

However, a major worry for Haier is how to fund its expansion plans. Increasing competition in the domestic markets is bringing Haier's finances under pressure.

Questions 4:

What should be the marketing strategies that Haier should employ in Emerging Markets, Maturing Markets and Declining Markets ? Explain the reasons behind it.

Case Study I

HAIER’s foray into International Markets :

In the late 1990s, the Haier group (Haier) was the leader in the Chinese consumer appliances market (with a 39.7%, 50% and 37.1% market share in refrigerators, air-conditioners and washing machines respectively in December 1998). But deflation in the Chinese economy slowed sales.

ut deflation in the Chinese economy slowed sales growth from 50% in 1998 to around 30% in 1999. Haier decided to look for new markets. Since the US had a large demand for consumer appliances, Haier entered the US market in 1999. Analysts were doubtful about Haier's acceptability to American consumers, as there was a general perception in the US that Chinese goods were of low quality. Haier, however, was confident that with its product differentiation strategy it would be able to create a positive image for its products among the American public. In the early 2000s, the consumer appliances market in the US started hotting up as Haier entered the market. By 2009, Haier products were sold in 9 of the 10 top retail chains in the US.

With Wal-Mart agreeing to stock Haier products, many analysts believed that Haier would be able to shake up the US consumer appliances market. In 2009, Haier had a 6% market share in the US refrigerator market; it stated that it was aiming for a 15% market share by 2015.

The history of Haier dates back to 1984 when Ruimin Zhang (Zhang), a bureaucrat with the local government was asked to take charge of Qingdao General Refrigerator Factory, a state-owned enterprise that is manufacturing refrigerators for sale in China. When Zhang took over the management, the company was on the brink of bankruptcy, with no funds to pay the salaries of its employees or to invest in new product development. When Zhang took charge of the company, he realized that the company did not look after the quality of its products; nor did it bother about customer satisfaction. In 1985, Zhang started importing technology from a German firm and began manufacturing technically sophisticated refrigerators.

Zhang emphasized the elements of customer satisfaction and quality control in the company. In 1985, when a customer complained about the poor performance of his refrigerator, Zhang conducted a quality check and found that out of 400 refrigerators inspected, 76 were defective.

He had all the defective refrigerators destroyed with a sledge-hammer. According to Zhang, this made the workers realize that quality is of only two types - acceptable and unacceptable. In 1989, the company changed its name to Qindao Refrigerator Co. Ltd., and it was restructured with funds raised from banks and government agencies. In 1991, the company once again changed its name to Qindao Haier Group Co. and in the same year it merged with Qingdao Air-conditioner Plant and Qingdao Freezer General Plant. In 1992, the company set up Qingdao Freezing Equipment Co. In the same year, it merged with another previously state-owned enterprise Qingdao Condenser Factory, which manufactured refrigerator condensers.

In the same year it became the first company in China to get ISO 9001 certification, and the company's name was changed to the Haier Group. In 1993, Haier went in for an IPO of RMB 50 million and got listed on the Shanghai Stock Exchange (SSE).

During the mid-1990s, Haier began to grow through mergers and acquisitions. In 1995, it merged with Red Star Electric Appliance Company (and five of its subsidiaries). This company manufactured washing machines. It also acquired Wuhan Elec-appliance Co., which manufactured freezers and air conditioners. Between 1995 and 1997, Haier acquired seven companies and started exporting its goods to foreign markets.

By 1997, Haier was the number one consumer appliances brand in China and the market leader in all its product segments, which included refrigerators, washing machines, microwave ovens and freezers and its revenues were reported at $1.15 billion (10 billion Yuan)...

Haier's Competitors in the US Market

USA was the world's largest and most competitive market for consumer appliances. The consumer appliances market can be segmented on the basis of products into kitchen appliances and home comfort products. Included in kitchen appliances are products such as dishwashers, disposers, compactors, food preservation appliances, refrigerators, freezers etc.

In the home comfort segment are included products such as room air-conditioners and dehumidifiers. The home appliances market in the US was dominated by American companies, namely GE Appliances (a subsidiary of General Electricals), Whirlpool and Maytag. The only strong foreign player in this market was Sweden's Electrolux. GE Appliances, Whirlpool, Maytag and Electrolux together accounted for around 98% of the 9 million standard refrigerators sales in the US every year. In the 1990s, many Asian players such as LG Electronics and Samsung entered the US market in a big way. The big four companies in the US market concentrated on the high- end market comprising full-size refrigerators and washing machines, since the margins in this segment were high...

Strategies in the US Market

Haier decided to compete with the US brands on the quality plank rather than on price. However, analysts felt that it would be very difficult for the company to win over American consumers who associated Chinese goods with low quality. To strengthen its presence in the US market, Haier adopted a localization strategy.

It opened a design center in the Los Angeles and employed US designers for designing its products for the US market. Haier also opened a marketing center in New York. The company focused on enhancing consumer awareness about the company and its products. Commenting on Haier's strategy, Zhang said, "We want consumers to feel that Haier is the one company that comes closest to satisfying their needs." For instance, none of the consumer appliances companies in the US offered a compact refrigerator to satisfy demand from college students who could not afford normal size refrigerators...

Going High-End

Most analysts felt that Haier would feel the real competition only when it entered the high-end market. In the compact refrigerator segment, Haier did not face much competition from established players in the US, who did not focus on the low margin segment.

However, the major US players were keeping track of Haier's activities. Commenting on the competition from Haier, GE Appliances Chief Executive, Jim Campbell said, "I take it very seriously. They may be producing only 200,000 refrigerators per year now, but that's going to get bigger."

On the negative side, some analysts felt that Haier lacked the brand image to make a dent in the high-end segment. They pointed out that in general US consumers were brand-conscious, and this was especially true in the case of high-end products. The lack of a positive brand image in this consumer segment would probably make it difficult for Haier to succeed in the high-end markets. Analysts felt that Haier had an additional weakness in its distribution and service centers...

Future Prospects

Despite a few reservations, analysts too were, by and large, upbeat about the company because of its strong performance in breaking into the American market in a short time.

Said Nicholas Heymann of Prudential Securities, "Over five years, it could become a force." With quality products and lower prices, it was felt that Haier would be able to garner a sizeable market share in the US. Haier's experience in the geographically vast and diversified Chinese market would serve it well in catering to the US market.

However, a major worry for Haier is how to fund its expansion plans. Increasing competition in the domestic markets is bringing Haier's finances under pressure.

Questions 2:

Is it possible for an organization like Haier to sustain its competition in brand conscious and quality conscious markets such as US and other countries?

Questions 3:

What are the countries that you would suggest Haier should concentrate upon? Why?

Read the case below and answer the questions that follow. P&G's Joy Makes an Unlikely Splash in Japan Anyone who thinks Japan doesn't offer opportunities for U.S consumer products should look at how quickly Procter & Gamble Co. has cleaned up in the country's dish-soap market. Until 1995, P&G, didn't sell dish soap in Japan at all. A few years later, it had Japans best-selling brand, Joy, which commanded a fifth of the nation's $400 million dish- soap market. That's astounding progress, given that the market had appeared to be classically "mature"-both shrinking and dominated by giant Japanese companies. "Joy surprised us all," says Tatsuo Ishii, dish-soap brand manager for one of those giants, Kao Corp. "It was brilliant." How the Cincinnati company executed its coup provides lessons that transcend the kitchen sink. One big lesson: "Mature" Japanese markets can be surprisingly complacent. P&G offered new technology, something the two incumbents hadn't bothered to do for years. It developed packaging that let stores make more money. And it spent heavily on oddball commercials that created a buzz among consumers. Joy offers "potent lessons" for foreign companies, says Hiroshi Tanaka, a marketing professor at Tokyo's Josai University. "At the least, Joy should tell you that Japan's got a lot more good opportunities for foreign companies than they might assume," he says. "Those opportunities are often disguised as unattractive markets suffering from saturation and oligopoly." Just two years ago, two powerful consumer-product concerns, Kao and Lion Corp., each controlled nearly 40% of the kitchen-soap market with several brands and had essentially declared a truce. The rest of the market was cornered by private brands at chain stores. Meanwhile, the Japanese were cooking less at home and thus buying less dish soap every year. P&G actually washed out of the Japanese kitchen detergent market during an earlier attempt. It withdrew in the late 1970s after failing to make a dent with Orange Joy, a product that it transplanted from the U.S. But by 1992, it had succeeded in marketing other products, such as Pampers, in Japan. The home office told its Japanese unit to find new markets for products in which P&G was strong elsewhere in the world. So that year P&G sent out researchers to study Japanese dish-washing rituals. They discovered one odd habit: Japanese homemakers, one after another, squirted out more detergent than needed. It was "a clear sign of frustration" with existing Japanese products, says Robert A. McDonald, head of P&G's Japanese operations. He saw the research as a sign that an "unarticulated consumer need" was more powerful soap. "We knew we had something to go after," he says.' Some P&G executives wert: concerned about entering such a mature market, says Mr. McDonald. But P&G's lab in Kobe went to work to create a highly concentrated soap formula, based on a new technology developed by the company's scientists in Europe, specifically for Japan. The first hint that Joy was a hit carne in March 1995 in the region around Hiroshima, 400 miles west of Tokyo, where P&G started test-marketing it. Four weeks into the test, Joy had become the most popular dish soap in the region with a 30% market share. P&G's marketing pitch was deceptively simple: A little bit of Joy cleans better, yet it's easier on the hands. The message hit a chord, says Ayumi Osaki, a 31-year-old homemaker who rushed off to buy Joy after seeing pilot commercials. "Grease on Tupperware, that's the toughest thing to wash off," says Ms. Osaki, a mother of three in Hiroshima. "I had to try it." Emboldened, P&G finished a nationwide introduction in March 1996, when Joy had attained a 10% market share, Three months later it had a 15% share. A year later it had 18%, and now its share is up to 20%, according to industry statistics, The results astounded even P&G. "Everybody in Japan wanted it," says P&G's Mr, McDonald. "Every retailer in Japan wanted to get his hands on Joy." Retailers clamored for Joy because P&G had built in "fat margins," explains Masaharu Kubo, a buyer for Daiei Inc" which operates 383 supermarkets in Japan, P&G had exploited a weakness in the Japanese giants' products. Their long-necked bottles wasted space, P&G's containers were compact cylinders that took less space in stores, warehouses and delivery trucks, Joy improved the efficiency of Daiei's distribution by about 40%, Kubo estimates, "Before Joy, dish soap was a sleepy category; [the containers] were bulky and took up a lot of shelf space, and their unit prices were falling every year," he says, "Joy freed up a lot of space for other products, pushed up prices of dish soaps as a whole, and gave us bigger margins, It was revolutionary." P&G's advertising binge also delighted retailers, Kubo says. To look for ideas, P&G marketers had watched more than a hundred commercials from around the world from P&G and its rivals. They settled on a documentary-style TV ad used in Britain by P&G for a laundry soap called Daz. P&G's advertising agency, Dentsu Inc. created commercials in which a famous comedian dropped in on homemakers, unannounced, with a camera crew to test Joy on the household's dirty dishes. The camera homed in on a patch of oil in a pan full If water, Then, after a drop of Joy, the oil dramatically disappeared. Japanese soap makers were alarmed by the campaign. Kao's Mr. Ishii says he ordered up research into Joy and concluded that more than 70% of Joy users began using it because of the commercials. "We had mistakenly assumed Japanese didn’t care much about grease-fighting power In dish soaps.” Mr. Ishii says. “The reality was people are eating more meat and fried food and are frustrated about grease stains on their plastic dishes and storage containers." Kao and Lion are now playing catch-up, turning out products that unabashedly mimic Joy, from its package and color (green) to its grease-fighting Technology. Successes like Joy have given P&G a change of heart about Japan, "For a long time, P&,G's approach was to dump in Japan what sells in the U.S.,” says a P&G manager who declined to be named. Now, he says, P&G generates ideas in Japan that it uses in other markets. It has begun selling Joy, for example, in the Philippines and is considering it for other Asian markets, It has also started to use a leak-free cap in the U. S. that it designed for Joy in Japan. The Japanese consumer is “among the world’s most educated and the most perceptive and articulate evaluators,: says P&G’s Mr. McDonald. “I’ve worked in a lot of countries but never been anywhere else where I can have a scientific discussion with the consumer like I can do here about dish soap.

Case Questions

1. What lessons can international marketers learn from Procter & Gamble’s experiences in Japan?

2. Identify and describe the roles of product policy, pricing, promotion and distribution in marketing Joy in Japan.

3. What lessons from Japan might benefit Procter & Gamble in other markets?

Answer all

Case Study I

HAIER’s foray into International Markets :

In the late 1990s, the Haier group (Haier) was the leader in the Chinese consumer appliances market (with a 39.7%, 50% and 37.1% market share in refrigerators, air-conditioners and washing machines respectively in December 1998). But deflation in the Chinese economy slowed sales.

ut deflation in the Chinese economy slowed sales growth from 50% in 1998 to around 30% in 1999. Haier decided to look for new markets. Since the US had a large demand for consumer appliances, Haier entered the US market in 1999. Analysts were doubtful about Haier's acceptability to American consumers, as there was a general perception in the US that Chinese goods were of low quality. Haier, however, was confident that with its product differentiation strategy it would be able to create a positive image for its products among the American public. In the early 2000s, the consumer appliances market in the US started hotting up as Haier entered the market. By 2009, Haier products were sold in 9 of the 10 top retail chains in the US.

With Wal-Mart agreeing to stock Haier products, many analysts believed that Haier would be able to shake up the US consumer appliances market. In 2009, Haier had a 6% market share in the US refrigerator market; it stated that it was aiming for a 15% market share by 2015.

The history of Haier dates back to 1984 when Ruimin Zhang (Zhang), a bureaucrat with the local government was asked to take charge of Qingdao General Refrigerator Factory, a state-owned enterprise that is manufacturing refrigerators for sale in China. When Zhang took over the management, the company was on the brink of bankruptcy, with no funds to pay the salaries of its employees or to invest in new product development. When Zhang took charge of the company, he realized that the company did not look after the quality of its products; nor did it bother about customer satisfaction. In 1985, Zhang started importing technology from a German firm and began manufacturing technically sophisticated refrigerators.

Zhang emphasized the elements of customer satisfaction and quality control in the company. In 1985, when a customer complained about the poor performance of his refrigerator, Zhang conducted a quality check and found that out of 400 refrigerators inspected, 76 were defective.

He had all the defective refrigerators destroyed with a sledge-hammer. According to Zhang, this made the workers realize that quality is of only two types - acceptable and unacceptable. In 1989, the company changed its name to Qindao Refrigerator Co. Ltd., and it was restructured with funds raised from banks and government agencies. In 1991, the company once again changed its name to Qindao Haier Group Co. and in the same year it merged with Qingdao Air-conditioner Plant and Qingdao Freezer General Plant. In 1992, the company set up Qingdao Freezing Equipment Co. In the same year, it merged with another previously state-owned enterprise Qingdao Condenser Factory, which manufactured refrigerator condensers.

In the same year it became the first company in China to get ISO 9001 certification, and the company's name was changed to the Haier Group. In 1993, Haier went in for an IPO of RMB 50 million and got listed on the Shanghai Stock Exchange (SSE).

During the mid-1990s, Haier began to grow through mergers and acquisitions. In 1995, it merged with Red Star Electric Appliance Company (and five of its subsidiaries). This company manufactured washing machines. It also acquired Wuhan Elec-appliance Co., which manufactured freezers and air conditioners. Between 1995 and 1997, Haier acquired seven companies and started exporting its goods to foreign markets.

By 1997, Haier was the number one consumer appliances brand in China and the market leader in all its product segments, which included refrigerators, washing machines, microwave ovens and freezers and its revenues were reported at $1.15 billion (10 billion Yuan)...

Haier's Competitors in the US Market

USA was the world's largest and most competitive market for consumer appliances. The consumer appliances market can be segmented on the basis of products into kitchen appliances and home comfort products. Included in kitchen appliances are products such as dishwashers, disposers, compactors, food preservation appliances, refrigerators, freezers etc.

In the home comfort segment are included products such as room air-conditioners and dehumidifiers. The home appliances market in the US was dominated by American companies, namely GE Appliances (a subsidiary of General Electricals), Whirlpool and Maytag. The only strong foreign player in this market was Sweden's Electrolux. GE Appliances, Whirlpool, Maytag and Electrolux together accounted for around 98% of the 9 million standard refrigerators sales in the US every year. In the 1990s, many Asian players such as LG Electronics and Samsung entered the US market in a big way. The big four companies in the US market concentrated on the high- end market comprising full-size refrigerators and washing machines, since the margins in this segment were high...

Strategies in the US Market

Haier decided to compete with the US brands on the quality plank rather than on price. However, analysts felt that it would be very difficult for the company to win over American consumers who associated Chinese goods with low quality. To strengthen its presence in the US market, Haier adopted a localization strategy.

It opened a design center in the Los Angeles and employed US designers for designing its products for the US market. Haier also opened a marketing center in New York. The company focused on enhancing consumer awareness about the company and its products. Commenting on Haier's strategy, Zhang said, "We want consumers to feel that Haier is the one company that comes closest to satisfying their needs." For instance, none of the consumer appliances companies in the US offered a compact refrigerator to satisfy demand from college students who could not afford normal size refrigerators...

Going High-End

Most analysts felt that Haier would feel the real competition only when it entered the high-end market. In the compact refrigerator segment, Haier did not face much competition from established players in the US, who did not focus on the low margin segment.

However, the major US players were keeping track of Haier's activities. Commenting on the competition from Haier, GE Appliances Chief Executive, Jim Campbell said, "I take it very seriously. They may be producing only 200,000 refrigerators per year now, but that's going to get bigger."

On the negative side, some analysts felt that Haier lacked the brand image to make a dent in the high-end segment. They pointed out that in general US consumers were brand-conscious, and this was especially true in the case of high-end products. The lack of a positive brand image in this consumer segment would probably make it difficult for Haier to succeed in the high-end markets. Analysts felt that Haier had an additional weakness in its distribution and service centers...

Future Prospects

Despite a few reservations, analysts too were, by and large, upbeat about the company because of its strong performance in breaking into the American market in a short time.

Said Nicholas Heymann of Prudential Securities, "Over five years, it could become a force." With quality products and lower prices, it was felt that Haier would be able to garner a sizeable market share in the US. Haier's experience in the geographically vast and diversified Chinese market would serve it well in catering to the US market.

However, a major worry for Haier is how to fund its expansion plans. Increasing competition in the domestic markets is bringing Haier's finances under pressure.

Questions 1:

What in your opinion is the significance of an organization entering into International Markets for business? Is it advantageous or disadvantageous?

Case Study I

HAIER’s foray into International Markets :

In the late 1990s, the Haier group (Haier) was the leader in the Chinese consumer appliances market (with a 39.7%, 50% and 37.1% market share in refrigerators, air-conditioners and washing machines respectively in December 1998). But deflation in the Chinese economy slowed sales.

ut deflation in the Chinese economy slowed sales growth from 50% in 1998 to around 30% in 1999. Haier decided to look for new markets. Since the US had a large demand for consumer appliances, Haier entered the US market in 1999. Analysts were doubtful about Haier's acceptability to American consumers, as there was a general perception in the US that Chinese goods were of low quality. Haier, however, was confident that with its product differentiation strategy it would be able to create a positive image for its products among the American public. In the early 2000s, the consumer appliances market in the US started hotting up as Haier entered the market. By 2009, Haier products were sold in 9 of the 10 top retail chains in the US.

With Wal-Mart agreeing to stock Haier products, many analysts believed that Haier would be able to shake up the US consumer appliances market. In 2009, Haier had a 6% market share in the US refrigerator market; it stated that it was aiming for a 15% market share by 2015.

The history of Haier dates back to 1984 when Ruimin Zhang (Zhang), a bureaucrat with the local government was asked to take charge of Qingdao General Refrigerator Factory, a state-owned enterprise that is manufacturing refrigerators for sale in China. When Zhang took over the management, the company was on the brink of bankruptcy, with no funds to pay the salaries of its employees or to invest in new product development. When Zhang took charge of the company, he realized that the company did not look after the quality of its products; nor did it bother about customer satisfaction. In 1985, Zhang started importing technology from a German firm and began manufacturing technically sophisticated refrigerators.

Zhang emphasized the elements of customer satisfaction and quality control in the company. In 1985, when a customer complained about the poor performance of his refrigerator, Zhang conducted a quality check and found that out of 400 refrigerators inspected, 76 were defective.

He had all the defective refrigerators destroyed with a sledge-hammer. According to Zhang, this made the workers realize that quality is of only two types - acceptable and unacceptable. In 1989, the company changed its name to Qindao Refrigerator Co. Ltd., and it was restructured with funds raised from banks and government agencies. In 1991, the company once again changed its name to Qindao Haier Group Co. and in the same year it merged with Qingdao Air-conditioner Plant and Qingdao Freezer General Plant. In 1992, the company set up Qingdao Freezing Equipment Co. In the same year, it merged with another previously state-owned enterprise Qingdao Condenser Factory, which manufactured refrigerator condensers.

In the same year it became the first company in China to get ISO 9001 certification, and the company's name was changed to the Haier Group. In 1993, Haier went in for an IPO of RMB 50 million and got listed on the Shanghai Stock Exchange (SSE).

During the mid-1990s, Haier began to grow through mergers and acquisitions. In 1995, it merged with Red Star Electric Appliance Company (and five of its subsidiaries). This company manufactured washing machines. It also acquired Wuhan Elec-appliance Co., which manufactured freezers and air conditioners. Between 1995 and 1997, Haier acquired seven companies and started exporting its goods to foreign markets.

By 1997, Haier was the number one consumer appliances brand in China and the market leader in all its product segments, which included refrigerators, washing machines, microwave ovens and freezers and its revenues were reported at $1.15 billion (10 billion Yuan)...

Haier's Competitors in the US Market

USA was the world's largest and most competitive market for consumer appliances. The consumer appliances market can be segmented on the basis of products into kitchen appliances and home comfort products. Included in kitchen appliances are products such as dishwashers, disposers, compactors, food preservation appliances, refrigerators, freezers etc.

In the home comfort segment are included products such as room air-conditioners and dehumidifiers. The home appliances market in the US was dominated by American companies, namely GE Appliances (a subsidiary of General Electricals), Whirlpool and Maytag. The only strong foreign player in this market was Sweden's Electrolux. GE Appliances, Whirlpool, Maytag and Electrolux together accounted for around 98% of the 9 million standard refrigerators sales in the US every year. In the 1990s, many Asian players such as LG Electronics and Samsung entered the US market in a big way. The big four companies in the US market concentrated on the high- end market comprising full-size refrigerators and washing machines, since the margins in this segment were high...

Strategies in the US Market

Haier decided to compete with the US brands on the quality plank rather than on price. However, analysts felt that it would be very difficult for the company to win over American consumers who associated Chinese goods with low quality. To strengthen its presence in the US market, Haier adopted a localization strategy.

It opened a design center in the Los Angeles and employed US designers for designing its products for the US market. Haier also opened a marketing center in New York. The company focused on enhancing consumer awareness about the company and its products. Commenting on Haier's strategy, Zhang said, "We want consumers to feel that Haier is the one company that comes closest to satisfying their needs." For instance, none of the consumer appliances companies in the US offered a compact refrigerator to satisfy demand from college students who could not afford normal size refrigerators...

Going High-End

Most analysts felt that Haier would feel the real competition only when it entered the high-end market. In the compact refrigerator segment, Haier did not face much competition from established players in the US, who did not focus on the low margin segment.

However, the major US players were keeping track of Haier's activities. Commenting on the competition from Haier, GE Appliances Chief Executive, Jim Campbell said, "I take it very seriously. They may be producing only 200,000 refrigerators per year now, but that's going to get bigger."

On the negative side, some analysts felt that Haier lacked the brand image to make a dent in the high-end segment. They pointed out that in general US consumers were brand-conscious, and this was especially true in the case of high-end products. The lack of a positive brand image in this consumer segment would probably make it difficult for Haier to succeed in the high-end markets. Analysts felt that Haier had an additional weakness in its distribution and service centers...

Future Prospects

Despite a few reservations, analysts too were, by and large, upbeat about the company because of its strong performance in breaking into the American market in a short time.

Said Nicholas Heymann of Prudential Securities, "Over five years, it could become a force." With quality products and lower prices, it was felt that Haier would be able to garner a sizeable market share in the US. Haier's experience in the geographically vast and diversified Chinese market would serve it well in catering to the US market.

However, a major worry for Haier is how to fund its expansion plans. Increasing competition in the domestic markets is bringing Haier's finances under pressure.

Questions 3:

What are the countries that you would suggest Haier should concentrate upon? Why?

Read and summarize the following text on Bioethics in one page. Please try to do it asap. It's urgent.

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BIOETHICS.

Bioethics as a field is relatively new, emerging only in the late 1960s, though many of the questions it addresses are as old as medicine itself. When Hippocrates wrote his now famous dictum Primum non nocere (First, do no harm), he was grappling with one of the core issues still facing human medicine, namely, the role and duty of the physician. With the advent of late-twentieth-century science, an academic field emerged to reflect not only on the important and age-old issues raised by the practice of medicine, but also on the ethical problems generated by rapid progress in technology and science. Forty years after the emergence of this field, bioethics now reflects the profound changes in medicine and the life sciences.

Nature and Scope of Bioethics

Against the backdrop of advances in the life sciences, the field of bioethics has a threefold mission: (1) to raise important questions about the general practice of medicine and the institutions of health care in the United States and other economically advanced nations, (2) to wrestle with the novel bioethical dilemmas constantly being generated by new biomedical technologies, and (3) to challenge the presumptions of international and population-based efforts in public health and the delivery of health care in economically underdeveloped parts of the globe. While attention to the ethical dilemmas accompanying the appearance of new technologies such as stem cell research or nanotechnology can command muchPage 214  | Top of Articleof the popular attention devoted to the field, the other missions are of equal importance.

At the core of bioethics are questions about medical professionalism, such as: What are the obligations of physicians to their patients? and What are the virtues of the "good doctor"? Bioethics explores critical issues in clinical and research medicine, including truth telling, informed consent, confidentiality, end-of-life care, conflict of interest, nonabandonment, euthanasia, substituted judgment, rationing of and access to health care, and the withdrawal and withholding of care. Only minimally affected by advances in technology and science, these core bioethical concerns remain the so-called bread-and-butter issues of the field.

The second mission of bioethics is to enable ethical reflection to keep pace with scientific and medical breakthroughs. With each new technology or medical breakthrough, the public finds itself in uncharted ethical terrain it does not know how to navigate. In the twenty-first century—what is very likely to be the "century of biology"—there will be a constant stream of moral quandaries as scientific reach exceeds ethical grasp. As a response to these monumental strides in science and technology, the scope of bioethics has expanded to include the ethical questions raised by the Human GenomeProject, stem cell research, artificial reproductive technologies, the genetic engineering of plants and animals, the synthesis of new life-forms, the possibility of successful reproductive cloning, preimplantation genetic diagnosis, nanotechnology, and xenotransplantation—to name only some of the key advances.

Bioethics has also begun to engage with the challenges posed by delivering care in underdeveloped nations. Whose moral standards should govern the conduct of research to find therapies or preventive vaccines useful against malaria, HIV, or Ebola—local standards or Western principles? And to what extent is manipulation or even coercion justified in pursuing such goals as the reduction of risks to health care in children or the advancement of national security? This population-based focus raises new sorts of ethical challenges both for health care providers who seek to improve overall health indicators in populations and for researchers who are trying to conduct research against fatal diseases that are at epidemic levels in some parts of the world.

As no realm of academic or public life remains untouched by pressing bioethical issues, the field of bioethics has broadened to include representation from scholars in disciplines as diverse as philosophy, religion, medicine, law, social science, public policy, disability studies, nursing, and literature.

History of Bioethics

Bioethics as a distinct field of academic study has existed only since the early 1960s, and its history can be traced back to a cluster of scientific and cultural developments in the United States during that decade. The catalysts for the creation of this interdisciplinary field were the extraordinary advances in American medicine during this period coupled simultaneously with radical cultural changes. Organ transplantation, kidney dialysis, respirators, and intensive care units (ICUs) made possible a level of medical care never before attainable, but these breakthroughs also raised daunting ethical dilemmas the public had never previously been forced to face, such as when to initiate admission to an ICU or when treatments such as dialysis could be withdrawn. The advent of the contraceptive pill and safe techniques for performing abortions added to the ethical quandaries of the "new medicine." At the same time, cultural changes placed a new emphasis on individual autonomy and rights, setting the stage for greater public involvement and control over medical care and treatment. Public debates about abortion, contraceptive freedom, and patient rights were gaining momentum. In response, academics began to write about these thorny issues, and scholars were beginning to view these "applied ethics" questions as the purview of philosophy and theology. "Bioethics"—or, at the time, "medical ethics"—had become a legitimate area of scholarly attention.

In its early years, the study of bioethical questions was undertaken by a handful of scholars whose academic home was traditional university departments of religion or philosophy. These scholars wrote about the problems generated by the new medicine and technologies of the time, but they were not part of a discourse community that could be called an academic field or subject area. Individual scholars, working in isolation, began to legitimize bioethical issues as questions deserving rigorous academic study. But bioethics solidified itself as a field only when it became housed in institutions dedicated to the study of these questions. Academic bioethics was born with the creation of the first "bioethics center."

Ironically, academic bioethics came into existence through the creation of an institution that was not part of the traditional academy. The first institution devoted to the study of bioethical questions was a freestanding bioethics center, purposely removed from the academy with its rigid demarcations of academic study. The institution was the Hastings Center, originally called The Institute of Society, Ethics and the Life Sciences, which opened its doors in September 1970. Its founder, Daniel Callahan, along with the psychiatrist Willard Gaylin, M.D., created the center to be an interdisciplinary institute solely dedicated to the serious study of bioethical questions. Callahan, a recently graduated Ph.D. in philosophy, had been one of the isolated scholars working on an issue in applied ethics, and he had found himself mired in complex questions that took him far afield from the traditional boundaries of philosophy. His topic, abortion, required engagement with the disciplines of law, medicine, and social science, which he felt himself unprepared to navigate. With academic departments functioning as islands within a university, it seemed that truly interdisciplinary work was impossible. The Hastings Center was founded to create an intellectual space for the study of these important questions from multiple perspectives and academic areas.

The second institution that helped solidify the field of bioethics was the Kennedy Institute of Ethics, which opened at Georgetown University in 1971. The founders had similar goals to those of Hastings, though they placed their center inside the traditional academy. While housed outside of any particular academic departments, the Kennedy Institute came to look more like a traditional department, offering degree programsPage 215  | Top of Articleand establishing faculty appointments along a university model.

From these modest beginnings, the field of bioethics exploded, with dozens of universities following suit, creating institutions whose sole function was the study of bioethical issues. Its growth was fueled by the appearance both of new technologies such as the artificial heart and in vitro fertilization and new challenges such as HIV. Bioethics was now permanently on the academic map and central to public discourse.

Institutions of Bioethics

Since the early 1970s, as bioethics has gained legitimacy, there has been an increasing trend of bioethics centers becoming academic departments. Originally modeled on the structure of an independent "think tank," the bioethics centers of the early twenty-first century are often housed within either a medical school or school of arts and sciences, indistinguishable in structure from any other departments in those schools. The professionalization of bioethics has taken it from the academic margins to the center, and with this development has come all of the trappings of traditional academics, such as tenure, degree programs, professional conferences, and academic journals.

Beginning in the 1980s, medical schools began housing bioethics institutes either as departments of medical ethics or departments of medical humanities. Located within an undergraduate medical school, the duties of these departments include the ethics education of the M.D. students. Whereas the original bioethics centers had as their primary focus the production of scholarly research, departments of bioethics have pedagogical obligations and are viewed as institutions designed to serve the narrower educational mission of the school. Bio-ethics institutions that are instead housed within a school of arts and sciences have the same type of pedagogical obligations, though perhaps serving a different student population, namely, university undergraduates or graduate students. Departments of bioethics, depending on their configuration, offer traditional undergraduate or graduate courses, undergraduate majors or concentrations, graduate degrees (usually master's degrees), undergraduate medical school ethics training, and/or residency ethics training. By the early twenty-first century, there were more than sixty master of bioethics programs in the United States, attracting a diverse student population including recent undergraduates; students pursuing joint J.D., M.D., and Ph.D. degrees; and midcareer professionals from the fields of law, medicine, and public policy whose work requires specialty training in the field of bioethics.

Another result of the professionalization of bioethics was the pressure to publish in traditional scholarly venues, such as academic journals. But the formation of a new academic field of study necessitated the creation of academic journals in which to publish these novel scholarly works. Journals emerged that were designed solely for works in the field of bioethics, including the Hastings Center Report, the Kennedy Institute of Ethics Journal, the American Journal of Bioethics, and Bioethics. But the mainstreaming of bioethics into the academy also opened up space within traditional medical and scientific journals for scholarly works in bioethics. Research in bioethics is now routinely published in the likes of the Journal of the American Medical Association, the New England Journal of Medicine, Science, and Nature.

Perhaps the institution most effectively used within the field of bioethics is the Internet. All major bioethics institutes, centers, and departments (and some journals) have elaborate Web sites, not only offering information about the specific institution, faculty, and degree programs, but also undertaking an educational mission to raise the level of public debate about current bioethical issues. These Web sites offer substantive information for individuals seeking to become better informed about these issues. One of the most developed Web sites is the companion site to the American Journal of Bioethics (www.bioethics.net ). This Web site not only offers actual scholarly works in the field but also includes a high school bioethics project, job placement information, a "Bioethics for Beginners" section, and a collection of bioethics news stories from the popular press, updated daily, with direct links to the original news articles.

The Methods of Bioethics

The founders of the field of bioethics and its first leaders were largely theologians or philosophers. Reflecting the scholarly conventions of their home disciplines, the first works in bioethics centered on a normative analysis of bioethical issues, arguing for or against the moral permissibility of a particular technology, practice, or policy. Starting in the 1970s, these philosophers and theologians were joined by physicians and lawyers, who too made normative claims about bioethical problems. But by the mid-1990s, bioethics was attracting populations of scholars who had not previously been well represented in the field, namely, social scientists and empirically trained clinicians, both physicians and nurses. With the entry of these new groups of scholars, the "methods" of bioethics began to shift, mirroring the methodologies of the new disciplines becoming central to the field. With this change, bioethics included not only normative analysis but also the empirical study of bioethical questions, what Arthur Caplan has called "empiricized bioethics."

Empiricized bioethics takes one of two forms: either it seeks to collect empirical data needed to shed light on a bioethical problem, or it attempts to stand outside the discipline in order to study the field itself. Projects taking the first form use either qualitative or quantitative social science methodology to collect data needed to make persuasive bioethical arguments. These empirical studies might explore, for example, patient comprehension of medical information, patient and family experience with medical care, the ability of children or incompetent adults to give consent for research participation, or the frequency with which practitioners face particular ethical dilemmas.

Projects taking the second form explore the way in which the field of bioethics is evolving, the influence it has had on policy formation, the methods and strategies it employs, the field's understanding of itself, and its place in public life and contemporary academia. One very prominent contemporaryPage 216  | Top of Articlemethod employing this strategy is narrative bioethics, or what might be called "deconstructionist bioethics." Using the insights of literary criticism, these bioethicists examine the discourse of the field to reveal its biases, conventions, and assumptions, making the field more self-reflective about its motives and goals. Along the same line, the field has seen the development of feminist bioethics and disability bioethics, both of which focus on issues of inclusion and exclusion, voice, and their confluence on particular substantive issues. Altogether, the empirical methods of bioethics have been so well received in the field that by the early twenty-first century, all bioethics centers and departments had representation from the social sciences or clinical medicine, and in many cases the empiricists constituted the majority of center or department membership.

One final methodology that has had a significant presence in medical humanities departments is literary analysis, in which literary texts are used as a vehicle for the ethics education of clinicians in training. These medical humanists use first-person illness narratives or first-person testimonies from clinicians, as well as important works in fiction, to teach health care professionals about the ethical issues involved in being both patient and practitioner.

Current Issues in the Field: Bioethics
in the Early Twenty-First Century

The bioethical issues being addressed by the field are too numerous to count, but the flavor of bioethics in the early twenty-first century can be conveyed by an exploration of the bioethical implications of genetic research, health care access reform, and stem cell research, arguably the most pressing issue in the field to date.

Advances in the science of genetics, including the Human Genome Project and the ability to find genetic markers for particular diseases, have raised difficult ethical dilemmas. Two of the most pressing issues are preimplantation genetic diagnosis and the genetic testing of adults. With the technology to identify inherited diseases in the early embryo comes questions about which embryos ought to be implanted, which diseases constitute a legitimate moral reason to discard an embryo or become the criterion for embryo selection, which traits ought parents be allowed to select or test for, and who ought to have access to this technology and on what grounds. For example, while there might be widespread support for testing embryos that might carry the trait for Tay-Sachs disease or cystic fibrosis, there are troubling questions about selecting embryos on the basis of sex, nonlethal trisomes (such as Down's syndrome), or aesthetic or character traits that technology may someday be able to screen for. In adult medicine, genetic tests already exist to detect mutations leading to some forms of inherited breast cancer and to Huntington's disease. Here, questions arise about privacy of health care information, psychological impact, stigmatization, lack of informed consent, health insurance access, and familial disclosure. With the advent of commercial genetic testing centers, patients will soon have easy access to genetic tests independent of the practice of clinical medicine, without the benefit of genetic counseling services, professional psychological support, or adequate, and possibly accurate, clinical information. The Internet, for example, will likely bring universal access to any genetic test as it becomes available.

Emerging Issues for the Future

As the twenty-first century unfolds, new and expanding areas of research will require increasing attention to their related ethical aspects.

Neuroethics.

Knowledge about the human brain holds much promise and offers much needed hope to those who suffer from disorders of the brain and mind. The relative accessibility of the brain through biochemical, electrical, and magnetic stimulation, as well as surgery, makes neurological interventions tempting as knowledge of brain structure, wiring, and chemistry grows. Nevertheless, there has been little systematic analysis of the ethical implications of the revolution in the brain sciences. This revolution raises numerous ethical questions and issues:

The "essence" of personhood and identity

The relation between physiological structures and higher functioning ("mind" or "self")

The ways in which abnormalities in the brain might account for atypical or antisocial human behavior

The acceptability of using pharmaceuticals, implants, or other interventions to enhance innate traits such as memory, attention span, or musical ability

The legitimacy of intervening to alter aspects of personality, mood, or emotion; to assess the effectiveness of treatments or incarceration in modifying criminal behavior; or to detect predispositions to both desirable and undesirable behavior in persons who cannot themselves consent

New knowledge of the brain will soon have an enormous impact on the legal and penal systems. How to integrate knowledge of the brain into the practice of forensics, the prosecution of persons accused of crime, and the screening of those seeking parole are all issues likely to become pressing in the not-too-distant future. Equally controversial will be the use of new knowledge about the brain in the detection and prevention of the onset of undesirable behavior in adolescents and children and in trying to improve or enhance their capabilities and skills.

Eugenics.

While there has been much attention in bioethics to the mapping of the human genome and to the nuclear transfer techniques used to clone Dolly the sheep and other animals, the most provocative genetics-related issue facing society during the first half of the twenty-first century is likely to be to what extent ought humans design their children. Rudimentary steps toward making eugenics a reality are all around us.

The finalization of a crude map of the human genome and other animal and plant genomes means that medicine will soon have at its disposal a huge amount of information about the contribution genetics makes to a wide variety of traits, behaviors,Page 217  | Top of Articleand phenotypic properties. In addition primitive efforts to introduce genes into the cells of the human body through gene therapy will be refined to the point at which genetic surgeons should be able to introduce targeted genes with specific functions into both somatic cells (cells in a person's body) and germ-line cells such as the stem cells in the testicles that create sperm in a man's body. And the ability to analyze the genetic makeup of sperm, eggs, and embryos has already led to some infertility clinics offering genetic testing for diseases as a part of their standard care for their clients. This means that parents of tomorrow, both infertile and fertile, will increasingly look to medicine to diagnose potential problems and risks before babies and children are created. The issue will not be whether humans should design their children but to what extent and with what if any limits on how far one may go to improve, enhance, and optimize them.

When should a person die?

Another fascinating emerging ethical issue is whether humanity should seek to control the time of death. It is one thing to agree that individuals who are dying have the right to withdraw or not initiate medical treatments. It is quite a different matter to say that someone who is not terminally ill but is suffering from a terribly disabling chronic condition, a severely diminished quality of life, or the prospect of decades of life in a state of dementia or extreme frailty should have the right to medical or technological assistance in dying as is already the case in the Netherlands, the state of Oregon, and Colombia. The focus of these debates, however, has been almost exclusively the terminally ill. As the population of the world ages over the course of the twenty-first century, more and more persons may begin to ask or demand the right to control the timing of their death, whether they are

Answer the following questions on the article: What are the main arguments in the article? What is the point of this article? What topics are covered?

Use proper grammar and sentence structure. Use simple sentences clearly answering the questions. Make sure the sentences make sense and are easy to understand. Do not use complicated vocabulary or complex sentence structure.
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BIOETHICS.

Bioethics as a field is relatively new, emerging only in the late 1960s, though many of the questions it addresses are as old as medicine itself. When Hippocrates wrote his now famous dictum Primum non nocere (First, do no harm), he was grappling with one of the core issues still facing human medicine, namely, the role and duty of the physician. With the advent of late-twentieth-century science, an academic field emerged to reflect not only on the important and age-old issues raised by the practice of medicine, but also on the ethical problems generated by rapid progress in technology and science. Forty years after the emergence of this field, bioethics now reflects the profound changes in medicine and the life sciences.

Nature and Scope of Bioethics

Against the backdrop of advances in the life sciences, the field of bioethics has a threefold mission: (1) to raise important questions about the general practice of medicine and the institutions of health care in the United States and other economically advanced nations, (2) to wrestle with the novel bioethical dilemmas constantly being generated by new biomedical technologies, and (3) to challenge the presumptions of international and population-based efforts in public health and the delivery of health care in economically underdeveloped parts of the globe. While attention to the ethical dilemmas accompanying the appearance of new technologies such as stem cell research or nanotechnology can command muchPage 214  | Top of Articleof the popular attention devoted to the field, the other missions are of equal importance.

At the core of bioethics are questions about medical professionalism, such as: What are the obligations of physicians to their patients? and What are the virtues of the "good doctor"? Bioethics explores critical issues in clinical and research medicine, including truth telling, informed consent, confidentiality, end-of-life care, conflict of interest, nonabandonment, euthanasia, substituted judgment, rationing of and access to health care, and the withdrawal and withholding of care. Only minimally affected by advances in technology and science, these core bioethical concerns remain the so-called bread-and-butter issues of the field.

The second mission of bioethics is to enable ethical reflection to keep pace with scientific and medical breakthroughs. With each new technology or medical breakthrough, the public finds itself in uncharted ethical terrain it does not know how to navigate. In the twenty-first century—what is very likely to be the "century of biology"—there will be a constant stream of moral quandaries as scientific reach exceeds ethical grasp. As a response to these monumental strides in science and technology, the scope of bioethics has expanded to include the ethical questions raised by the Human GenomeProject, stem cell research, artificial reproductive technologies, the genetic engineering of plants and animals, the synthesis of new life-forms, the possibility of successful reproductive cloning, preimplantation genetic diagnosis, nanotechnology, and xenotransplantation—to name only some of the key advances.

Bioethics has also begun to engage with the challenges posed by delivering care in underdeveloped nations. Whose moral standards should govern the conduct of research to find therapies or preventive vaccines useful against malaria, HIV, or Ebola—local standards or Western principles? And to what extent is manipulation or even coercion justified in pursuing such goals as the reduction of risks to health care in children or the advancement of national security? This population-based focus raises new sorts of ethical challenges both for health care providers who seek to improve overall health indicators in populations and for researchers who are trying to conduct research against fatal diseases that are at epidemic levels in some parts of the world.

As no realm of academic or public life remains untouched by pressing bioethical issues, the field of bioethics has broadened to include representation from scholars in disciplines as diverse as philosophy, religion, medicine, law, social science, public policy, disability studies, nursing, and literature.

History of Bioethics

Bioethics as a distinct field of academic study has existed only since the early 1960s, and its history can be traced back to a cluster of scientific and cultural developments in the United States during that decade. The catalysts for the creation of this interdisciplinary field were the extraordinary advances in American medicine during this period coupled simultaneously with radical cultural changes. Organ transplantation, kidney dialysis, respirators, and intensive care units (ICUs) made possible a level of medical care never before attainable, but these breakthroughs also raised daunting ethical dilemmas the public had never previously been forced to face, such as when to initiate admission to an ICU or when treatments such as dialysis could be withdrawn. The advent of the contraceptive pill and safe techniques for performing abortions added to the ethical quandaries of the "new medicine." At the same time, cultural changes placed a new emphasis on individual autonomy and rights, setting the stage for greater public involvement and control over medical care and treatment. Public debates about abortion, contraceptive freedom, and patient rights were gaining momentum. In response, academics began to write about these thorny issues, and scholars were beginning to view these "applied ethics" questions as the purview of philosophy and theology. "Bioethics"—or, at the time, "medical ethics"—had become a legitimate area of scholarly attention.

In its early years, the study of bioethical questions was undertaken by a handful of scholars whose academic home was traditional university departments of religion or philosophy. These scholars wrote about the problems generated by the new medicine and technologies of the time, but they were not part of a discourse community that could be called an academic field or subject area. Individual scholars, working in isolation, began to legitimize bioethical issues as questions deserving rigorous academic study. But bioethics solidified itself as a field only when it became housed in institutions dedicated to the study of these questions. Academic bioethics was born with the creation of the first "bioethics center."

Ironically, academic bioethics came into existence through the creation of an institution that was not part of the traditional academy. The first institution devoted to the study of bioethical questions was a freestanding bioethics center, purposely removed from the academy with its rigid demarcations of academic study. The institution was the Hastings Center, originally called The Institute of Society, Ethics and the Life Sciences, which opened its doors in September 1970. Its founder, Daniel Callahan, along with the psychiatrist Willard Gaylin, M.D., created the center to be an interdisciplinary institute solely dedicated to the serious study of bioethical questions. Callahan, a recently graduated Ph.D. in philosophy, had been one of the isolated scholars working on an issue in applied ethics, and he had found himself mired in complex questions that took him far afield from the traditional boundaries of philosophy. His topic, abortion, required engagement with the disciplines of law, medicine, and social science, which he felt himself unprepared to navigate. With academic departments functioning as islands within a university, it seemed that truly interdisciplinary work was impossible. The Hastings Center was founded to create an intellectual space for the study of these important questions from multiple perspectives and academic areas.

The second institution that helped solidify the field of bioethics was the Kennedy Institute of Ethics, which opened at Georgetown University in 1971. The founders had similar goals to those of Hastings, though they placed their center inside the traditional academy. While housed outside of any particular academic departments, the Kennedy Institute came to look more like a traditional department, offering degree programsPage 215  | Top of Articleand establishing faculty appointments along a university model.

From these modest beginnings, the field of bioethics exploded, with dozens of universities following suit, creating institutions whose sole function was the study of bioethical issues. Its growth was fueled by the appearance both of new technologies such as the artificial heart and in vitro fertilization and new challenges such as HIV. Bioethics was now permanently on the academic map and central to public discourse.

Institutions of Bioethics

Since the early 1970s, as bioethics has gained legitimacy, there has been an increasing trend of bioethics centers becoming academic departments. Originally modeled on the structure of an independent "think tank," the bioethics centers of the early twenty-first century are often housed within either a medical school or school of arts and sciences, indistinguishable in structure from any other departments in those schools. The professionalization of bioethics has taken it from the academic margins to the center, and with this development has come all of the trappings of traditional academics, such as tenure, degree programs, professional conferences, and academic journals.

Beginning in the 1980s, medical schools began housing bioethics institutes either as departments of medical ethics or departments of medical humanities. Located within an undergraduate medical school, the duties of these departments include the ethics education of the M.D. students. Whereas the original bioethics centers had as their primary focus the production of scholarly research, departments of bioethics have pedagogical obligations and are viewed as institutions designed to serve the narrower educational mission of the school. Bio-ethics institutions that are instead housed within a school of arts and sciences have the same type of pedagogical obligations, though perhaps serving a different student population, namely, university undergraduates or graduate students. Departments of bioethics, depending on their configuration, offer traditional undergraduate or graduate courses, undergraduate majors or concentrations, graduate degrees (usually master's degrees), undergraduate medical school ethics training, and/or residency ethics training. By the early twenty-first century, there were more than sixty master of bioethics programs in the United States, attracting a diverse student population including recent undergraduates; students pursuing joint J.D., M.D., and Ph.D. degrees; and midcareer professionals from the fields of law, medicine, and public policy whose work requires specialty training in the field of bioethics.

Another result of the professionalization of bioethics was the pressure to publish in traditional scholarly venues, such as academic journals. But the formation of a new academic field of study necessitated the creation of academic journals in which to publish these novel scholarly works. Journals emerged that were designed solely for works in the field of bioethics, including the Hastings Center Report, the Kennedy Institute of Ethics Journal, the American Journal of Bioethics, and Bioethics. But the mainstreaming of bioethics into the academy also opened up space within traditional medical and scientific journals for scholarly works in bioethics. Research in bioethics is now routinely published in the likes of the Journal of the American Medical Association, the New England Journal of Medicine, Science, and Nature.

Perhaps the institution most effectively used within the field of bioethics is the Internet. All major bioethics institutes, centers, and departments (and some journals) have elaborate Web sites, not only offering information about the specific institution, faculty, and degree programs, but also undertaking an educational mission to raise the level of public debate about current bioethical issues. These Web sites offer substantive information for individuals seeking to become better informed about these issues. One of the most developed Web sites is the companion site to the American Journal of Bioethics (www.bioethics.net ). This Web site not only offers actual scholarly works in the field but also includes a high school bioethics project, job placement information, a "Bioethics for Beginners" section, and a collection of bioethics news stories from the popular press, updated daily, with direct links to the original news articles.

The Methods of Bioethics

The founders of the field of bioethics and its first leaders were largely theologians or philosophers. Reflecting the scholarly conventions of their home disciplines, the first works in bioethics centered on a normative analysis of bioethical issues, arguing for or against the moral permissibility of a particular technology, practice, or policy. Starting in the 1970s, these philosophers and theologians were joined by physicians and lawyers, who too made normative claims about bioethical problems. But by the mid-1990s, bioethics was attracting populations of scholars who had not previously been well represented in the field, namely, social scientists and empirically trained clinicians, both physicians and nurses. With the entry of these new groups of scholars, the "methods" of bioethics began to shift, mirroring the methodologies of the new disciplines becoming central to the field. With this change, bioethics included not only normative analysis but also the empirical study of bioethical questions, what Arthur Caplan has called "empiricized bioethics."

Empiricized bioethics takes one of two forms: either it seeks to collect empirical data needed to shed light on a bioethical problem, or it attempts to stand outside the discipline in order to study the field itself. Projects taking the first form use either qualitative or quantitative social science methodology to collect data needed to make persuasive bioethical arguments. These empirical studies might explore, for example, patient comprehension of medical information, patient and family experience with medical care, the ability of children or incompetent adults to give consent for research participation, or the frequency with which practitioners face particular ethical dilemmas.

Projects taking the second form explore the way in which the field of bioethics is evolving, the influence it has had on policy formation, the methods and strategies it employs, the field's understanding of itself, and its place in public life and contemporary academia. One very prominent contemporaryPage 216  | Top of Articlemethod employing this strategy is narrative bioethics, or what might be called "deconstructionist bioethics." Using the insights of literary criticism, these bioethicists examine the discourse of the field to reveal its biases, conventions, and assumptions, making the field more self-reflective about its motives and goals. Along the same line, the field has seen the development of feminist bioethics and disability bioethics, both of which focus on issues of inclusion and exclusion, voice, and their confluence on particular substantive issues. Altogether, the empirical methods of bioethics have been so well received in the field that by the early twenty-first century, all bioethics centers and departments had representation from the social sciences or clinical medicine, and in many cases the empiricists constituted the majority of center or department membership.

One final methodology that has had a significant presence in medical humanities departments is literary analysis, in which literary texts are used as a vehicle for the ethics education of clinicians in training. These medical humanists use first-person illness narratives or first-person testimonies from clinicians, as well as important works in fiction, to teach health care professionals about the ethical issues involved in being both patient and practitioner.

Current Issues in the Field: Bioethics
in the Early Twenty-First Century

The bioethical issues being addressed by the field are too numerous to count, but the flavor of bioethics in the early twenty-first century can be conveyed by an exploration of the bioethical implications of genetic research, health care access reform, and stem cell research, arguably the most pressing issue in the field to date.

Advances in the science of genetics, including the Human Genome Project and the ability to find genetic markers for particular diseases, have raised difficult ethical dilemmas. Two of the most pressing issues are preimplantation genetic diagnosis and the genetic testing of adults. With the technology to identify inherited diseases in the early embryo comes questions about which embryos ought to be implanted, which diseases constitute a legitimate moral reason to discard an embryo or become the criterion for embryo selection, which traits ought parents be allowed to select or test for, and who ought to have access to this technology and on what grounds. For example, while there might be widespread support for testing embryos that might carry the trait for Tay-Sachs disease or cystic fibrosis, there are troubling questions about selecting embryos on the basis of sex, nonlethal trisomes (such as Down's syndrome), or aesthetic or character traits that technology may someday be able to screen for. In adult medicine, genetic tests already exist to detect mutations leading to some forms of inherited breast cancer and to Huntington's disease. Here, questions arise about privacy of health care information, psychological impact, stigmatization, lack of informed consent, health insurance access, and familial disclosure. With the advent of commercial genetic testing centers, patients will soon have easy access to genetic tests independent of the practice of clinical medicine, without the benefit of genetic counseling services, professional psychological support, or adequate, and possibly accurate, clinical information. The Internet, for example, will likely bring universal access to any genetic test as it becomes available.

Emerging Issues for the Future

As the twenty-first century unfolds, new and expanding areas of research will require increasing attention to their related ethical aspects.

Neuroethics.

Knowledge about the human brain holds much promise and offers much needed hope to those who suffer from disorders of the brain and mind. The relative accessibility of the brain through biochemical, electrical, and magnetic stimulation, as well as surgery, makes neurological interventions tempting as knowledge of brain structure, wiring, and chemistry grows. Nevertheless, there has been little systematic analysis of the ethical implications of the revolution in the brain sciences. This revolution raises numerous ethical questions and issues:

The "essence" of personhood and identity

The relation between physiological structures and higher functioning ("mind" or "self")

The ways in which abnormalities in the brain might account for atypical or antisocial human behavior

The acceptability of using pharmaceuticals, implants, or other interventions to enhance innate traits such as memory, attention span, or musical ability

The legitimacy of intervening to alter aspects of personality, mood, or emotion; to assess the effectiveness of treatments or incarceration in modifying criminal behavior; or to detect predispositions to both desirable and undesirable behavior in persons who cannot themselves consent

New knowledge of the brain will soon have an enormous impact on the legal and penal systems. How to integrate knowledge of the brain into the practice of forensics, the prosecution of persons accused of crime, and the screening of those seeking parole are all issues likely to become pressing in the not-too-distant future. Equally controversial will be the use of new knowledge about the brain in the detection and prevention of the onset of undesirable behavior in adolescents and children and in trying to improve or enhance their capabilities and skills.

Eugenics.

While there has been much attention in bioethics to the mapping of the human genome and to the nuclear transfer techniques used to clone Dolly the sheep and other animals, the most provocative genetics-related issue facing society during the first half of the twenty-first century is likely to be to what extent ought humans design their children. Rudimentary steps toward making eugenics a reality are all around us.

The finalization of a crude map of the human genome and other animal and plant genomes means that medicine will soon have at its disposal a huge amount of information about the contribution genetics makes to a wide variety of traits, behaviors,Page 217  | Top of Articleand phenotypic properties. In addition primitive efforts to introduce genes into the cells of the human body through gene therapy will be refined to the point at which genetic surgeons should be able to introduce targeted genes with specific functions into both somatic cells (cells in a person's body) and germ-line cells such as the stem cells in the testicles that create sperm in a man's body. And the ability to analyze the genetic makeup of sperm, eggs, and embryos has already led to some infertility clinics offering genetic testing for diseases as a part of their standard care for their clients. This means that parents of tomorrow, both infertile and fertile, will increasingly look to medicine to diagnose potential problems and risks before babies and children are created. The issue will not be whether humans should design their children but to what extent and with what if any limits on how far one may go to improve, enhance, and optimize them.

When should a person die?

Another fascinating emerging ethical issue is whether humanity should seek to control the time of death. It is one thing to agree that individuals who are dying have the right to withdraw or not initiate medical treatments. It is quite a different matter to say that someone who is not terminally ill but is suffering from a terribly disabling chronic condition, a severely diminished quality of life, or the prospect of decades of life in a state of dementia or extreme frailty should have the right to medical or technological assistance in dying as is already the case in the Netherlands, the state of Oregon, and Colombia. The focus of these debates, however, has been almost exclusively the terminally ill. As the population of the world ages over the course of the twenty-first century, more and more persons may begin to ask or demand the right to control the timing of their death, whether they are deemed terminally ill or not.