The cabbie called out, "'Ere now, madam! You wouldn't want to give Piccadilly Circus a miss, would you? That's Eros, the god of love, up there takin' aim at us." Hiroko Miyamoto looked up from the stack of papers she was sorting into her briefcase and met the driver's cheerful eyes in the rearview mirror. She laughed and played along, pretending to shield herself from the famous statue's arrow. Hiroko's mood was light. Meetings she'd expected to take all day had wrapped up early, giving her time to return to the hotel and even fit in some shopping before launching back into business over dinner. She settled into the ample seat of the taxi and soaked up the scene. Japanese electronics firms still dominated the garish signage on the Circus—a dubious honor for her countrymen. And the traffic was, if anything, even more impassable than she remembered from her last trip. But it was enchanting to be in London again. After turning into Regent Street, the cab progressed more quickly toward the hotel. Yet, Hiroko managed to spy the white marble storefront of Castlebridge & Company. She leaned forward. "Driver, I've changed my mind. Could you let me out here?" The shop was the ideal place to pick up the gifts she wanted. Castlebridge—so well made and so very, very British—was one brand that no one in Japan seemed to get enough of. Whether it would be less expensive to shop at Castlebridge in its home country she didn't know, but that hardly mattered. It would mean a great deal to people that she bought their gifts right at the source. 

Minutes later, a solicitous assistant was at Hiroko's side offering to relieve her of the armload of scarves and gloves she had already accumulated—all in the brand's signature brown, blue, and coral plaid. He whisked them off to the sales counter. Hiroko was studying a navy version of Castlebridge's signature raincoat, a possible souvenir for herself, when the phone in her suit pocket hummed. She checked the display to determine what language to use in greeting. It was Fergus Harold, her business school classmate and, as chance would have it, now her counterpart in a joint deal by their respective banks. "Hello, old chap. Hungry already?" "Just checking that you're clear on where the restaurant is," said Fergus. "And, mind you, they're calling for rather wet weather this evening." Hiroko glanced toward the front of the shop, which was still bathed in seemingly untroubled afternoon light. But of course this was London, whose weather could always surprise. She shrugged and headed toward a display of umbrellas. "Oh, don't worry about me. I'm at Castlebridge's now, buying everything in sight. If there's one thing I should be equipped for, it's rain."

Made in Where? 

As Fergus approached the restaurant, a woman crossed the street ahead of him, protected by an ample plaid umbrella but obviously taking care, in her stylish heels, to skirt the puddles. Squinting against the steady downpour, he recognized Hiroko and hurried to open the door for her. He was eager to share the one fact about his career he hadn't yet mentioned in their rekindled acquaintance: For the past year, he'd been on the board of directors of Castlebridge, the very company she'd been doing trade with that afternoon. "Beautiful umbrella!" Fergus smiled brightly. "Have you owned it long?" Hiroko laughed. "Oh, this old thing?" She pulled a mock grimace. "Actually, I'm afraid I might not own it much longer if my husband catches sight of this." She pointed to a small tag of cloth sewn into a seam on the umbrella's underside. "The last time I brought home something labeled 'Made in Malaysia' I got quite a lecture. His grandfather suffered terribly there during the Pacific War, and Minoru was sure it would upset his mother to see the tag." "I'm so sorry to hear about that," Fergus said. He ushered Hiroko toward the coat check. "I had heard that the London store was on the site of the original Castlebridge workshop. I'd hoped the umbrella would have been made right there." "Yes," she sighed. "It is too bad. I had heard that the London store was on the site of the original Castlebridge workshop. I'd hoped the umbrella would have been made right there."

Flies in the Ointment 

Fergus had enjoyed a relaxing evening with Hiroko. His dinner conversation with her had touched on many topics—and she had in fact been delighted to hear of his Castlebridge connection—but it was those few words in the rain that came back to him weeks later. He was attending the quarterly meeting of Castlebridge's board of directors, and the first presentation was an update on the company's operations restructuring. CFO Doris Milne assured the directors that Project Fulcrum had moved decisively into its implementation phase after a year of analysis and planning. "This is a chart with which you are all familiar." Doris was wrapping up with a review of the revenue growth over the past four years. It was heady stuff, as PowerPoint slides go. The investments and energy applied to revamping the company's brand and to building new markets globally—all initiated by CEO Mary Crane—had paid off in huge sales increases. Doris tapped her keyboard, and a second line appeared on the chart. "This, however, has been the fly in the ointment. Our costs rose dramatically as well, yielding margins that have failed to impress." Another click and both lines shot to the right, projecting a future in which they would diverge to good effect. Revenues continued north, while expenses headed south. 

"The steps we are taking to rationalize the supply chain and shift more manufacturing to lower-cost regions, particularly China, will support margins in this range." After some discussion and debate about how those numbers would translate to the bottom line and ultimately affect shareholder value, Mary rose to thank her CFO. "We of course understand," she said, "that the changes Doris has outlined will have consequences for workers and communities, and not all of them will be welcomed. The board should note, in particular, that the announcement of the Yorkshire plant's closure has prompted a hue and cry from the trade unionists, and they have launched some publicity efforts against us." "Those are the Keep Castlebridge British people, are they?" one of the directors asked. "Just last evening someone mentioned them to me." Fergus's ears pricked up. "Yes," said the CEO dryly. "We are talking with them about their concerns. But as Doris indicated, the move to shut down Yorkshire is a relatively small step in what has been a long-term trend toward offshore production—even of the very jumpers being made there."

Jumpers. It was the first time Fergus had heard the American CEO use the term—in fact, she'd once told him she'd never be able to call them anything but sweaters. He wished he could kid her about it now. "No one expects the unionists to be pleased," she continued, "but I should think this campaign of theirs will blow over rather soon." Fergus spoke up. "I'm not as certain as you, Mary, that Keep Castlebridge British won't gain some traction. It's damned clever of them, isn't it, elevating it to that level. This could turn out to be a real thorn in our side." Mary allowed that it was clever. "But I think there's a limit to how much can be made of it. There are still a thousand of us here in London, and we're adding headquarters jobs constantly. At the end of the day, what this amounts to are only 270 workers."

An Identity Crisis 

The weeks that followed proved Fergus right, but he took little pleasure in that fact. Instead of petering out, the Keep Castlebridge British campaign steadily picked up steam. Celebrities with only the most tenuous connections to Yorkshire added their voices to the chorus, urging Castlebridge to reverse its decision. In what was otherwise a slow period for news, reporters descended on the factory town. Images of crestfallen garment workers were spliced between stentorian denouncements by politicians courting votes. Inevitably, the workers with the longest tenures—and whitest hair—were dragged by the media into the spotlight, to emphasize by contrast their employer's lack of loyalty.

Fergus wasn't surprised when he picked up a phone message from Mary Crane. He had joined the board of directors around the same time Mary arrived, and that produced a sort of kinship between them. "I received a letter today from Glynn Jones regarding the Yorkshire closure," she said when Fergus called back that evening. Jones was the striking young actor, of rising popularity, now appearing in ads as the face of Castlebridge. "He hasn't chosen to bite the hand that feeds him publicly yet, but he's on file." Fergus hated to detect that hint of bitterness in Mary's voice. He hastened to make sympathetic noises and begged to be of service in whatever way she would find helpful. "You can help me think this through again," she sighed. "I thought I had good instincts when it came to PR crises, but I'm realizing we might be in a situation that has to be approached differently here in Britain. There's a lot of posturing going on, obviously, but how much does this really matter to the public?" "That's a very good question," Fergus said. "And I would simply urge you to think about it broadly. 'The public' means one thing when it refers generally to consumers of news, and something else entirely when it refers specifically to shoppers at Castlebridge." 

There was also the question of what the public was reacting to. Was it the plight of the Yorkshire workers specifically, or a more diffuse sense of unease about the loss of manufacturing capabilities throughout Britain? "It's possible we are victims of timing—having closed a plant, however small, just as people had stomached all they could of plant closures. Someone, I suppose, has to be the one to place that last straw on the camel's back." Mary went silent for a moment—a sudden retreat from conversation that was one of the CEO's signature quirks (and one that Fergus had learned not to tread on). "In that case," she said finally, "we might want to make a really outsize gesture to counterbalance the effect. It could be an opportunity for us. I've been wondering if we shouldn't be much more visible in our commitment to social responsibility. Here's a splashy compromise we could offer: Just give the factory to the workers, free and clear, to make productive use of as they choose. Simply donate it to the townspeople." Fergus raised his eyebrows. The factory needed some modernizing, perhaps, but it certainly wasn't worthless. He wondered how his fellow directors might react to the proposal. The real point, however, was not that Mary's idea was too grand but that it seemed somehow off the mark. He tried to explain. "Charity is important, it's true. We must do right by the workers. But we need to think, too, about this other group of people—" "You mean the shareholders," Mary interjected. "No—although they're crucial as well, of course. No, I mean the customers." He thought of Hiroko, Anglophile that she was, of her affection for the brand and her disappointment at seeing that "Made in Malaysia" label. 

Japan was Castlebridge's largest market these days, yet Fergus hadn't heard any discussion in board meetings of how its shoppers might react to goods made in China. "We're a company, after all, that has always traded on its quintessentially British image. And somehow, that has always seemed authentic. Even after all the wool started coming from Brazil, and the cotton from America, and the buttons from France. Even when the production moved to eastern Europe. Even when our design group embraced diversity and brought influences in from every corner of the globe." "We're a company, after all, that has always traded on its quintessentially British image." Mary laughed and added to the litany. "And even when the board brought in a New Yorker as CEO, who hired an Italian to make the ads, and a Swede to design the flagship store. But darn it, we're still British!" "Is it possible we have reached a tipping point?" Fergus wondered, back on a serious note. "This business of keeping Castlebridge British might be resonating because our Britishness has finally become too diluted. That is my concern. What happens to our customer appeal," he continued, "if our brand promise begins to ring hollow?" "What happens to our customer appeal if our brand promise begins to ring hollow?" Finally Fergus felt he had his arms around the real issue, and he was eager to pursue it. He could sense, however, that his CEO was trying to wind down the conversation. The idea of the factory donation had captured her imagination, and she was eager to make the calls necessary to get that ball rolling. She thanked him for his insight and generosity of spirit, and promised to cycle back to him soon.

Defining "Britishness"

Elizabeth Harold was happy to go along on an errand to Savile Row after lunching with her husband in the City. Fergus's new overcoat had been ready for a week now, and he was eager to start enjoying it. As they walked in the crisp fall air, he returned to the subject that was preoccupying him. By now, Elizabeth was thoroughly versed in the matter, approaching boredom, and inclined to be irreverent. "I don't see the problem," she said. "What could be more British than pressing foreign workers into subjugation in the interest of British commerce? Why not change the company slogan to The Sun Never Sets on Castlebridge and make a virtue of it?" Fergus favored her with an ironic laugh, and they entered the shop. A studious-looking man stepped away from his task of displaying neckties and welcomed them. Elizabeth drifted toward a showcase of cuff links while the man phoned back to the fitting room. Soon Fergus saw Thomas, his favorite of all the cutters he'd met, step through the doorway at the back of the showroom. "Good day, Mr. Harold," Thomas called out. "What a beautiful coat I have for you. I'd be grateful if you'd be so kind as to try it on once more." Following Thomas past stacks of pattern cuttings, Fergus nodded to a tall man, rather portly, who appeared to be undergoing a second fitting for a suit. Two tailors busied themselves with measuring and chalking the grey pinstripe, making the occasional artisan's remark through the pins held between their lips. Few things, Fergus reflected, were as steeped in British tradition as the bespoke woolen suit. How much did the merchants of Savile Row think that their craftsmanship was a matter of location? No doubt each tailor benefited from proximity to other masters of the trade—but the truth was that most kinds of manufacturing were becoming lost arts in the British Isles. Today, the most skilled garment workers in China had more in common with the earliest employees of Castlebridge than did any current workforce that could be mustered in Britain. For Castlebridge to claim to be quintessentially British, perhaps it really was enough to be managed out of a London headquarters. What, after all, defined Britishness? And what defined the brand?

Questions:

1) What and how environments affect the Castlebridge & Company to decide of moving the factory to China?

2) Explain and discuss the STP (Segmenting, Targeting, Positioning) of Castlebridge & Company!

Answer rating: 100% (QA)

1 A few key factors affected Castlebridge Companys decision to move their factory from Yorkshire UK ... View the full answer