(a)

Differences between unitary and two-tier board structures

as Under a unitary board structure there is a single board of directors, comprising executive and non-executive directors (NEDs). There are two separate boards under the two-tier structure: the management (operating) board which is responsible for the day-to-day running of the business, consisting of executives only and led by the chief executive. The supervisory (corporate) board with a wider membership, responsible for the strategic oversight of the organization and led by the chairman.

a Concentrating the role of CEO and chairman in the hands of one person (so called CEO duality) is admitted in a one-tier board in the one-tier board. In the two-tier board, the CEO cannot chair the supervisory board under any circumstances.

a One-tier boards are organized in a unitary way; control and supervision of management are integrated and exercised by one group of directors while the two-tier board adopts a binary approach; the supervisory board exercises the control role, while the formally separated management board exercises the strategy role.

as the two-tier model allows for more stakeholder inclusivity than the one-tier model.

at the non-executive directors (NEDs) on a unitary board will be, largely, classified as independent NEDs, stressing the fact that they will act in the best interests of the wider shareholder population. The supervisory board under a two-tier structure will include representatives of major shareholders, environmental groups, employees (possibly from trade unions) and providers of finance. These individuals, although not holding executive positions within the business, are definitely not considered to be “independent” and will be acting in the interest of their own group.

as Under a two-tier board structure the two boards meet separately, so executive discussion around running the business will not be heard by the higher board members, and vice versa. This is unlike the single board meeting that will be held for a unitary board.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              (b)

Factors determining the intensity of competition among rival firms

a Market growth. Rivalry is intensified when firms are competing for a greater market share in a total market where growth is slow or stagnant. In a matured or declining market rivals would have to battle for the customers of one another if they want to increase market share. Thus, rivals’ firms resort to a lot of competitive actions such as advertising battles, sales promotion campaigns, price competition, etc. The telecommunication industry in Ghanara, for instance, is currently experiencing intensified competition among rival firms due to the slow growth in the market coupled with the increase in participating firms in the industry.

a Cost structure. In an industry which is characterized by high costs, firms will have to sell more of their products in order to be taken and start making profits. Such high fixed costs are a temptation to rival firms to compete on price, since in the short run any contribution from sales is better than none at all. This seem to be true in the Ghanaian telecommunication industry. Rivals’ firms to have invested heavily in terms of the telecommunication infra. such as masts, fiber cable networking, and office spaces and the regions, etc. These are very huge, fixed costs that must be caters for regions, etc. These are very huge, fixed costs that must be caters for regions, etc. These are very huge, fixed costs that must be caters for regions, etc. These are very huge, fixed costs that must be caters for regions, etc. These are very huge, fixed costs that must be caters for regions, etc. These are very huge, fixed costs that must be caters for. The result is the fierce promotional campaigns and advert for. The result is the fierce promotional campaigns and adverb for battles in the industry.

a Switching costs. Switching costs come in three different ways money costs, time costs and inconvenience costs – that customers a product face when they switch their preference from one product that of a rival. Higher switching costs tend to lock-in customers of particular products. In an industry which is characterized by low switching costs of customers – i.e. they can switch easily with, in which in covering significant costs – suppliers will compete intensely in order to win over the customers of rival firms. For instance, the portion of system that was introduced into the telecommunication industry system that was significantly reduced the switching costs of customers. The NCA has significantly reduced the switching costs of customers. This further intensified competitive rivalry among rival firms in the industry.

a Capacity. A supplier might need to achieve a substantial increase in output capacity, in order to obtain reductions in unit costs or enjoy countries of scale. In an industry where achieving economies of scale is a strategic objective, competitive rivalry is intensified since each firm focuses on increasing its capacity and to sell more.