Critical analysis comparing two companies, economics homework help

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Economics

Description

For Assessment 2, use the article listed below to write a 3–4 page critical analysis comparing two companies.

Read Reichheld's 2006 article, "The Microeconomics of Customer Relationships," in MIT Sloan Management Review, volume 47, issue 2, pages 73–78. This article is available in the Capella library and is linked in the Resources.

  • Think critically about the topics presented in the article and evaluate the author's point of view. You will synthesize this new information into the current paradigm of knowledge and understanding, such as the theory of profit maximization and/or utility maximization.
  • Evaluate the author's arguments and conclusions for creating value in a specific firm.
  • Draw your own conclusions on value creation by applying relevant data, facts, theories, and economic principles from the article and other reading you have done.

Select two publicly traded companies from the Standard and Poor's (S&P) 500 for comparison:

  • Select one company that is considered exemplary.
  • Select one company that is not considered exemplary; perhaps a company that has had some sort of issue that it, itself, caused.

Using what you have gleaned from Reichheld's article, as well as supporting and relevant data, resources, references, and economic principles, write a 3–4 page critical analysis comparing the two companies. You are expected to support your analysis with appropriate citations and references to other academic sources.

  • Address the following components in regard to each of the companies you selected:
    • Identify and analyze an issue or issues related to the value of customer relations, for each company.
    • Evaluate the economic significance of the issue or issues related to customer relations for each company, with regard to the theory of profit maximization and/or utility maximization.
    • Apply the author's arguments and conclusions for creating value in a specific firm to the two companies you selected.
    • Assess the impact of ethical and regulatory considerations.
    • Evaluate the author's arguments and conclusions for creating value in a specific firm.
    • Draw your own conclusions on value creation by applying relevant data, facts, theories, and economic principles from the article and other reading you have done.
  • Be sure to use correct APA format for your in-text citations and reference list. Use the resources provided to help you properly cite and reference your sources and avoid plagiarism. Remember that Wikipedia is not an appropriate source to use in an academic or professional paper.

Additional Requirements

  • Written communication: Written communication should be free of errors that detract from the overall message.
  • APA formatting: Your paper should be formatted according to current APA style and formatting.
  • Length: 3–4 typed and double-spaced pages.
  • Font and font size: Times New Roman, 12-point.
  • Research: Refer to the Research Resources in the left navigation menu for help finding credible sources. 
  • Resources: Reichheld, F. (2006). The microeconomics of customer relationships. MIT Sloan Management Review, 47(2), 73–78.

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Explanation & Answer

Check the attached document ..Do let me know if there is any edits.

Critical Analysis of “The Microeconomics of Customer Relationships”
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In the article of “The Microeconomics of the customer relationship,” author raised the
issue of customer relationship and the important of this relationship for the growth of firm for
this purpose he has used the approach of NPR to check the significance importance of
relationship on a firm. Net Promoter Score is an index which is used to measure the willingness
of the customer whether it recommends company products to others or not. In organizations, it’s
used to check the effectiveness of the investments for the improving the customer care. It makes
a sense in the market where for promotion word of mouth is used.
The author quoted the example of the two companies named General Electric Company
as well as American Express using the NPS in the respective growth due to the customer
relationship. It’s imperative for an organization to keep satisfies his customers as the growth of
the organization and the profit is dependent upon the satisfaction of the customer.
Reichheld's in his article defined the three types of customers based upon Net Promoter
score. These categories are listed below.
1. Promoter
2. Passives
3. Detractors
The nature of the connections developed by the firm will specifically affect the demand
for their products a...


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