Sustainable Development

Final Case Assignment

Submitted by:
Supragya Saurabh
1602207
PGDIM 23 Section C
NITIE Mumbai
Q1. What are the alternatives and what should Seventh Generation do about baby
wipes problems? Write down advantages and disadvantages of each alternative.

Ans:
A few possible alternatives are suggested as:
1. Carry out an immediate clearance of the shelves and only stock them with new wipes
once they become available.

Advantages
It is the most ideal alternative and is coherent with the values of the Seventh
Generation
This would in turn better help emphasize their commitment towards doing the right
thing.
Theres nearly no risk of a backfire in terms of PR with this alternative.

Disadvantages
By clearing out the shelves immediately and waiting for them to be restocked with
newly formulated wipes, this alternative will pose a serious financial risk.
Theres also a chance that the Supermarket is unable to commit the shelf-space till the
stock of newly formulated wipes arrive.

2. Instead of clearing out the shelves, sell the wipes that exist in stock on the shelves and
then wait for the newly formulated wipes rather than re-ordering the older wipes once
this stock gets over.

Advantages
This is more of a balanced approach as far as avoiding commitment for shelf-space is
concerned.
The cost of removing wipes from the shelves is eliminated.
The chances of this culminating into a PR disaster arent that much.

Disadvantages
The financial risk consideration as in Alternative 1 is still not entirely eliminated.
Theres still no guarantee that the supermarkets will agree to commit shelf space.

3. Keep selling and ordering the old formulation wipes until the newer wipes become
available.

Advantages
No financial risk as in the above two alternatives
Low/no risk of losing shelf space in stores.

Disadvantages
Would be the most unideal alternative.
Would be totally against the values of the Seventh Generation
Q2. What is behind the rise in the environmentally sensitive segment of the industry?

Ans:
The factors responsible for the growth of the environmentally sensitive segment of the
industry are:
Customers these days like to be well informed about the products theyre associating
themselves with. It helps the company to be environmentally sensitive.
The customers of today also feel a strong need to take preventive courses of actions
against detrimental health effects.
The customers also need not merely products that perform well, but are also superior
to alternatives on finer points such as environmental sensitivity.
It is evident how the psychology of the customers of this age is becoming a factor for
the growth of the environmentally sensitive segment of the industry.
Additionally, with the advent of technology and outreach, there has been a continual
rise in the recognition and identification of problems surrounding health in the
conventional products.
Demand for greener products is increasing as the purchasing power of such customers
is also increasing.
By marketing the product as green, the companies instil a sense of superiority in
these products which increase their demand.

Q3. How does "values-driven" strategy add costs?

Ans.
Some elements which add costs are discussed below:
Greener ingredients are usually more expensive.
Increased benefits for workers will significantly add to the costs.
Choosing an expensive distribution system when often smaller channels would do the
requisite job.
Cost of time spent by staff on meetings that are conducted to facilitate better decision
making.

Q4. How Seventh Generation's environmentally differentiation strategy stack up using

Reinhardt's three criteria of willingness to pay, provision of credible information, and
presence of barriers to imitation of the strategy? Which of the three is the strongest and
which is the weakest?

Ans.
A) Willingness to Pay
The information from survey suggests that a segment for customers willing to pay
does exist.
These customers tend to have a high degree of loyalty and have historically purchased
such products.
The value proposition is aligned with their behaviour.
 B) Credible Information
By furthering its transparency agenda, Seventh Generation has ensured its customers
trust it more than their conventional counterparts.
A lot of information on ingredients is provided by Seventh Generation.
Having chemists like Martin Wolf who remain in public access adds to the credibility.
Trusted sources review Seventh Generation favourably.

C) Barriers to Imitation
While the brand and the reputation of the company are tremendous, it isnt impossible
for conventional companies to purchase or grow a natural products competitor.
Also, the shelf space at the companys disposal isnt impossible for such prospective
competitors to acquire.

In my opinion, in this case, the criterion of Credible Information is the strongest while
Barriers to Imitation is the weakest.