The Bell Boing V-22 Case Study Sample

Situation Overview

Offsets as a marketing tool are appropriate in that they motivate purchases by exhibiting and assuring additional advantages for the customer country beside the military investment. Bell Boeing’s preference for offsets instead of cash transactions is in line with the widespread sale techniques. Politically, defense offsets are more motivating than primarily acquiring the items of trade. There are also democratic psychologies that sideline the use of cash in transactions and promote the preference for use of offsets. However, there is the risk of corruption occurring in the offset way of acquiring military weapons such as tilt rotors. As such, there is an improper influence for the need of defense acquisitions. There also arises the competition of decision in the main contract leading to some transparent ways. Finally, the government is also put in a position to use its corrupt officials to repay the offsets.

Problem Presentation

Countertrade is controversial due to its way of trade management. The government, however, is usually reluctant when it comes to the institutionalization of countertrade. It has left managers in the country learning the hard way to ensure that they use the trade management mechanisms to their advantage. Some U.S. companies, having no specific countertrade policies and strategies, deliberately downplay the whole concept of countertrade. The policy on countertrade in a company primarily uses the company’s benefits, and the needs of the buyer country are met at a minimum.
Companies that have gotten themselves into trade with problematic countries are not for countertrade. Depending on the trade experiences, they approach the countertrade business with so much caution. A country may have encountered some corrupt foreign officials, non-delivery or slow delivery of counter-purchase products or other aggravations. Product availability may change, and the main demands may get altered. However, the company would not be blamed for following the other company’s advantage policy. On the other hand, a country with smooth running countertrade transactions would still resent their involvement. The resentment would be due to some concrete issues such as low profits, lack of pure methods of running free trade and a fair competition.

Alternative Strategies and Evaluations

Offset arrangement does not help the governments to acquire trade information. No officials in the U.S. government are allowed to enter into a memorandum of understanding with foreign governments that would require the U.S. defense technology changed. Neither would a foreign firm with any contract type subject to offset conditions be allowed to implement such an agreement. Otherwise, there would be adverse consequences to the defense industry. The result would be great financial losses in the U.S. firms. Any firm in the United States required to transfer the defense technology to a different foreign firm by terms of an M.O.U. is allowed to protest the determination to the Secretary of Defense. The Secretary of Defense, after consultations with the secretary of state and the secretary of commerce, makes the concluding decision on the validity of the claims.

Recommendation

The international market is key for the V- 22 and is one of the problems that has resulted in deep cuts in the expenditure of the U.S. government. Bell and Boeing executives said that the Middle East holds promise for the Osprey, and so does Europe. The V- 22 is an ideal solution for the Middle East and Europe, not only for defense mechanisms but also for humanitarian aid missions. The missions would include search-and-rescue, special operations as well as emergency medical services. The terrain, especially in the Middle East justifies that use of the Osprey. It is applicable since it would be a perfect match for their problems both defensively and on normal social missions.