Media Summary and Analysis Summary The article under examination is Washington ’s Passion and Life the Real Bottom Line. This article examinessocial and cultural aspects related to recent business changes in the Australian wine industry. The main notion in this article is that while the economy has experienced tremendous downturn, there has been a marked rise in wine competition. The article notes that this goes beyond any rational business sense, as downturns in economic patterns generally lead to subsequent reductions in companies, much less are new companies actually created.
Added to this is the fact that agricultural conditions have created a surplus of grapes, further diluting production and profits. The article argues that this anomaly can predominantly be attributed to social and cultural factors surrounding the nature of the industry. Specifically, it contends that individuals involved in the market do so for the social reasons of lifestyle, passion, and enjoyment. Application As the nature of social and cultural business considerations within the context of this business environment are naturally outside the realms of traditional analysis, a subsequent understanding of irrational decision making must be implemented in considering the various realms of this process.
One of the notable such tools has been proposed by Ashkenas (2011). In these regards, Ashkensas (2011) notes, “Irrational behavior is part of the human condition…At some level, conscious or unconscious, each of us has a compelling reason — such as short-term gratification, peer acceptance, convenience, lifestyle, and many more — for doing the "wrong" thing. ” Within this spectrum of understanding, it’s argued that rather than simply attributing Australian business winery growth to irrational market conditions, it’s necessary for business competitors to consider the hidden or subtle rationality in the decision making process.
Analysis The main consideration for Australian wine business in this social and cultural climate of irrationality is developing means of harnessing these human irrational elements to the most effective means possible. In considering human irrationality in the business context, Moldoveau (2010) proposes a number of key principles. One of the main elements that is useful for established Australian businesses in the wine market is to leverage irrationality against newly emergent companies. As indicated earlier, the newly emergent market participants have done so not out of sound business sense, but as a reflection of personal interest and passion.
In combating this irrationality, Moldoveau (2010) indicates that oftentimes these individuals are motivated in the short-term, but dissipate in long-term contexts. In these regards, it would be possible to structure company outgrowth towards gaining long-term customers, or providing significant discounts for individuals with long-term orders. Such a strategy allows the company to retain market share even with the in-flux of new participants. Similarly, Devron (2005) argues that such irrationality tends towards lack of efficient decision-making.
Within this understanding it’s clear that retaining strong supply-chain efficiency and strict business standards is necessary to retain a competitive advantage. References Ashkenas, R. (2011). Embrace Your Irrational Colleagues. Available: http: //blogs. hbr. org/ashkenas/2011/09/embrace-your-irrational- collea. html. Last accessed 2011. Devron, S. (2005). Irrationality and the Workplace. New York: Templeton. Moldoveau, R (2010). The Strategic Management of Irrationality. Boston: Roman School of Management. Washington, S. (2011). Passion and Lifestyle the Real Bottom Line. Available: http: //www. smh. com. au/business/passion-and-lifestyle-the-real-bottom- line-20110911-1k40c. html. Last accessed 2011.