Dippin’ Dots: Strategic Management
Dippin’ Dots’ return on investments, market share, and profitability is an indication that it has a future. Assuming an innovative approach in the food industry, Dippin’ Dot has made ice cream available across ten countries and 50 states (Dippin’ Dots, n.d). In addition, the organization adopted a multi-prolonged distribution strategy of partnership establishments. This method of collaboration, especially, especially with Doc Popcorn, ensured the company’s presence in about 7,000 convenience stores within the US (Dippin’ Dots, n.d). In 2018, Dippin’ Dots maintained a high profile receiving the Martha Layne Collins Award offered to businesses by the World Trade Center Kentucky for exceptional progress.
After Dippin’ Dot bailed from bankruptcy in 2012, the organization showed significant improvement. Both the founder, Curt Jones, and the president, Scott Fischer, shared their visions and creativity for the company’s future. As a result, Dippin’ Dot was able to make annual revenue of $120 million in 2017 (Dippin’ Dots, n.d). The primary acquisitions included Doc Popcorn, which helped in its positive performance. Consequently, in 2018, Dippin’ Dot’s summer sales increased up to 10% in comparison to previous years. The company also provided opportunities for budding entrepreneurs by setting up franchise startup fees of $15,000 (Dippin’ Dots, n.d). Therefore, in terms of return on investments, market share, and profitability, Dippin’ Dots performed fairly well due to its achievements.
- The corporation’s missions and objectives are clearly articulated. However, the strategies and policies are implied through actions and performance.
- Dippin’ Dot manufactures ice cream and other confectionery foods. The company has developed a special way of making its products into particularly small beads of ice cream, yogurt, flavored ice, and sherbet (Dippin’ Dots, n.d). The organization remains true and committed to a mission of innovation in the products and services by pursuing partnerships with an increased degree of profitability and integrity.
- Dippin’ Dots’ three main objectives include the passion for businesses, focus on the increasing demand through high-quality products, and operational excellence. This entails the drive to continuously bolster the brand by working on expanding the sales through research and development as well as the introduction of new products. The missions and objectives of Dippin’ Dots and the internal environment of the organization are consistent.
One of the strategies that Dippin’ Dots employs is increasing its market share in other areas across the globe, which is attained through awareness and franchising. In addition, the company also ventures into improving the products’ quality, introducing new features, and applying technical integrity and innovation (Dippin’ Dots, n.d). Furthermore, through a partnership distribution strategy, Dippin’ Dots ensured its presence in numerous stores within the US.
The above strategies intertwine with the organization’s missions, objective strategies, and internal and external environment (Dippin’ Dots, n.d). The brand strives to ensure its products are high quality and distributed to its consumers across the globe, bringing the best experience. Therefore, the idea to make memories is highlighted in the strategies as they are articulated in the missions and goals of the organization.
- One of the policies instituted at Dippin’ Dots is to be socially responsible. The company strives to relate to different communities by introducing ice cream products for children (Dippin’ Dots, n.d). Other significant policies include innovation and creativity, as demonstrated by the founder Curt Jones. The above policies are correlated with objectives, missions, and the internal and external environment.
- The policies reflect the corporation’s domestic operations and trade operations across the US, which boosts demand on the market. Dippin’ Dots is multi-domestic since the United States is the primary source of the company’s income (Dippin’ Dots, n.d). At the same time, through research and development, Dippin’ Dots can compete internationally.
The board of directors comprises a group of individuals who are tasked with the mandate of making strategic decisions. One of the board members is the company’s CEO, Scott Fischer has been on the board for nine years. He also owns the majority of shares. The other board members include Michael Barrette, the chief marketing and sales officer (Dippin’ Dots, n.d). His roles are to oversee domestic sales, marketing, and franchising. Adam Cross is the vice president of sales and marketing, while Steve Rothenstein is the associate vice president of franchising. Dana Knudsen, the senior director of marketing, has served the organization for 13 years (Dippin’ Dots, n.d). The company’s stock is privately held, and thus, it does not offer publicly traded stock.
The board of directors plays a crucial role in the company’s growth since they plan and strategize the brand’s long- and short-term goals. In addition, the board of directors also establishes mechanisms to monitor progress against objectives (Dippin’ Dots, n.d). For example, they review and discuss the company’s goals. The board is also involved in the daily activities and affairs of Drippin’ Dots, as highlighted by the department. They do not just stamp the management proposals but actively participate in the company’s life, pertaining to decision-making and the future performance and success of the company.
Despite the global operations, the brand has not been influenced politically. However, there are federal regulations regarding frozen desserts, including a minimum of 10% butterfat. The core market for Dippin’ Dots, the United States, is an economy with a strong GDP, which has not been affected over the years through the varying economic conditions (Dippin’ Dots, n.d). In addition, the growth of the Asian market is also a factor that has resulted in the increasing demand for Drippin’ Dots’ ice cream in Asia.
Dippin’ Dots has based the technology of microencapsulation. Flash freezing the ice cream through liquid nitrogen at -325 degrees and gathering the bead to generate a special flavor, shape, and texture has been remarkable (Dippin’ Dots, n.d). Furthermore, the venture was named “ice cream of the future” due to its uniqueness over time; technology allowed the development of various frozen desserts’ production, including Sherbets, novelties, and frozen yogurt.
Political factor is one of the aspects in the macro-environment that affects the performance of an organization. It formulates policies that guide the operations of the business. For example, the patenting of the flash freezing was a major factor that ensured Dippin’ Dots maintained a strong competition despite copying. Making contracts and franchising were also necessary since it maintained a legal distribution relationship and royalty payment.
Socio-cultural factors are among the environmental forces that affect economic activity. The most significant factor for the Dippin’ Dots company is the market demography. The brand initially targeted children aged 8-18 years despite seeing a possible growth in demand among other age groups in the future (Dippin’ Dots, n.d). In addition, the trend to consume healthy treats resulted in the launch of ice cream with limited fat, texture, and taste for the customers.
The Threat of New Entrants
The ice cream market had been dominated and segmented by two major organizations: Unilever and Nestle. This created a challenge to keep the giants from entering the flash-frozen ice cream segment. Some of the competitors with similar business practices include Ben and Jerry’s, Carvel, Haagen-Dazs, and Dairy Queen (Dippin’ Dots, n.d). Through its knowledge and experience, Dippin’ Dots kept surviving the competition through differentiating the ice cream and establishing of huge distribution network through franchising.
Bargaining Power of Buyers
The buyer power of customers is high due to various reasons. Firstly, the brand is known for its ice creams and producers. Secondly, the competition is strong, which means that customers are more likely to move if not satisfied with taste and quality. Finally, customers cannot differentiate the products in the market. Therefore, they have the power to choose which company to buy from.
The Threat of Substitute Products
Other similar frozen treats such as novelties and other ice cream are a substitute for flash-frozen ice cream. This is due to the similar satisfaction to the customers (Dippin’ Dots, n.d). Furthermore, due to the segmented market, the products were differentiated, resulting in the survival and growth of Dippin’ Dots.
Bargaining Power of Suppliers
Suppliers’ power is high because most of them deliver quality products and work with loyal customers. Importantly, new entrants also pose new threats to how they copy the idea (Dippin’ Dots, n.d). The majority of the producers are former franchise distributors and employees of Dippin’ Dots; thus, they understand the strategy of operations.
Rivalry Among Competing Firms
Due to globalization, Dippin’ Dots faces stiff competition from US companies such as Breyers. Therefore, it is important to differentiate the product due to the possibility of copying the ideas by other organizations (Dippin’ Dots, n.d). Additionally, the cost of operation also plays a significant role as it requires huge funds and technological investment.
The Relative Power of Unions, Government, Special Interests Groups
The power of unions and special interest groups is high as well. This is because new legislation and decrees may force Dippin’ Dots to terminate its operations for a given period of time. For instance, the regulations by the FDA regarding the consumption of foods processed with liquid nitrogen caused controversy (Dippin’ Dots, n.d). However, the reassurance of its production of ice cream using liquid nitrogen at the company brought relief.
Summary of External Factors
The most important forces among the above mentioned include the bargaining power of buyers and suppliers since if customers are satisfied and happy, then Dippin’ Dots will continue producing products. However, the external factor of technology and its capability of shifting demands and job trends will be crucial (Dippin’ Dots, n.d). Based on the missions and objectives of Dippin’ Dots, it is essential to ensure robust revisions and concentration of technology and innovation.
Dippin’ Dots’ corporate structure is represented using a model of functional circles. This model entails the leadership and strategy council, implying that the corporate structure is clearly defined. The support circle represents various back-office functions, including finance, human resources, strategic planning, and information services (Dippin’ Dots, n.d). The decision-making within Dippin’ Dots is decentralized in a manner that departments are the most appropriate in addressing the pertinent issues and making decisions. Every member of the organization clearly understands the structure adopted by Dippin’ Dots, and every employee ensures they are consistent with the organizational objectives and policies as articulated.
Dippin’ Dot has established a belief that the key to success is ensuring balance through employee empowerment. The organization believes in the philosophy of establishing relationships. As a result, its corporate culture ensures the promotion of a stronger bond between the top management and the staff through the embrace of fish philosophy (Groysberg et al., 2018). The belief and philosophy include paying attention to every employee, lightening up, and choosing important daily attitudes.
In terms of environmental sustainability, Dippin’ Dots’ culture ensures adaptability to the changing environmental regulations by ensuring improved innovation and quality performance for sustained products. Furthermore, it is important to say that the culture at Dippin’ Dots resonates with the diversity of employee backgrounds since staff members from different cultures are employed (Dippin’ Dots, n.d). Most importantly, while expanding its markets in Asia and other regions across the globe, Dippin’ Dot considers the host community culture, such as packaging, to ensure maximum profits and establish a great experience among customers.
Marketing is an integral process because it determines the performance of an organization. The marketing objectives of Dippin’ Dots include the new services and products promotion, growth of digital presence, targeting new customers, and establishment of brand loyalty, thus increasing sales and revenues (Dippin’ Dots, n.d). These objectives are clearly stated within the policies of the organization and are also consistent with the mission and strategies of the company.
Dippin’ Dots is one of the primary ice cream vendors in the US. The company provides frozen ice cream of different shapes and types to various customers in the US and across the globe (Dippin’ Dots, n.d). The list of products provided by the company includes ice cream, novelties, frozen yogurt, sherbets, frozen custard, and gelato. As a result, the products offered to influence the performance of the organization.
The products’ price could be steep for some; the brand’s fans find the prices convenient at $5 for five ounces. Due to the prices being high compared to the competitors, the majority of the people prefer alternatives (Dippin’ Dots, n.d). However, loyal customers keep purchasing. The company also partnered with global franchises like MacDonald’s and advertisements companies to promote the products.
Place represents where an organization is located. Dippin’ Dots, at first, was primarily located in the United States. Its products were offered in most American states. However, the brand has since expanded and offered its products outside the US into foreign markets (Dippin’ Dots, n.d). As a result, the organization holds a greater market share and hopes to expand its global operations further.
Providing frozen ice cream symbolizes a significant experience for the organization. The company collaborated with MacDonald’s to enhance its product promotions. Additionally, Dippin’ Dots ran ads in 17 Nickelodeon and Seventeen magazines. The organization also hired Hollywood advertisers to enhance its product promotion strategies (Dippin’ Dots, n.d). From the marketing strategies above, it is evident that Dippin’ Dots enhances its availability in the market through active promotion. These trends have enhanced and printed the organization in society.
Marketing enables the company to enjoy a competitive advantage since it partners with renowned organizations and advertising companies that impact the general public. The marketing strategies of Dippin’ Dots are similar and can be compared to the rivals’ marketing performances. The marketing managers in the organization ensured the application of accepted techniques and concepts to enhance product performance (Dippin’ Dots, n.d). The marketing strategies also adapt to the conditions in different countries, such as the availability of technology and the Internet. The managers are sure that the company can send the right message to attract and retain existing customers. Therefore, the marketing managers of Dippin’ Dots lead the promotion and positioning of the brand.
Dippin’ Dots shares similar financial objectives with most business organizations. The financial objectives include growth in revenues, earnings, and expansion of profit margins. In this regard, the goals of Dippin’ Dots are aligned with the organization’s missions, aims, and strategies (Dippin’ Dots, n.d). Regarding financial analysis, Dippin’ Dots performs relatively well in terms of its finances. Significant trends from the analyses indicate that the organization’s revenue fluctuates relatively over time, as shown in the graph below. In addition, the past corporate decisions are visible through the analyses indicating the corporations need to learn from their experiences for improved performance.
The financial managers apply the right financial concepts and techniques in evaluating profits and enhancing divisional performance. For instance, a tally of the departmental profit margins is often provided to enhance understanding of the organization’s progress. In addition, financial managers are responsible for the financial well-being of the organization. The financial managers generate reports develop strategies and plans for the long-term financial goals of the organization.
Research and Development
The current research and development objectives of Dippin’ Dots involve expanding its production and manufacturing in the regions of its operations. The organization’s management believes in the innovation capabilities of its employees and thus challenges and recruits the top talents and committed employees to enhance and equip its research in the development department (Dippin’ Dots, n.d). Curiosity, innovation, and growth have always been the driving force behind Dippin’ Dots.
The company’s development and research departments are always looking for development avenues. New ventures and products, including Coffee Dots, are expected to return and reclaim the top innovative throne to Dippin’ Dots (Dippin’ Dots, n.d). The research and technology development goals are clearly stated and implied through the performance and directions of the top management. Importantly, the objectives are consistent with the missions of bringing the best service to consumers through elevated experience from Dippin’ Dots ice cream products.
Technology is vital in the performance of Dippin’ Dots. For instance, technological advancements ensure a faster and more convenient purchasing experience as well as a more efficient means of handling business transactions (Dippin’ Dots, n.d). Particular technology within the business includes accounting systems, point of sales systems, management of information systems, and other helpful tools. Therefore, technology is important in protecting financial data and confidential executive decisions pertaining to organizational performance.
Moreover, the technology ensures businesses can keep their ideas from the competitors. The mix of applied, basic, and engineering research are appropriate based on the corporate missions and strategies (Bryson et al., 2018). Dippin’ Dots aims to satisfy different groups of people across the globe through its products. Therefore, understanding and conducting appropriate research is important in making sure the organization attains its objectives and missions.
Dippin’ Dots receives significant returns worth millions due to research and development. Through these actions, Dippin’ Dots understands the areas where to venture and make bigger investments as well as the products to introduce to the market. Additionally, Dippin’ Dots is also competent in terms of technological transfers (Dippin’ Dots, n.d). Starting with its founder, who is a microbiologist, Dippin’ Dots has embraced technology and ensures that its employees and staff are of high technological knowledge.
The corporation’s investment in research and development is almost similar to other organizations’ investment in research and development investment. However, Dippin’ Dots surpasses most businesses since its culture is primarily based on the research and development of new strategies to capture a wider market (Dippin’ Dots, n.d). Research and development of the conditions in every nation that the organization intends to begin its operations adjust and prepare the company for the challenges and the market.
Operations and logistics
Dippin’ Dots is currently pushing modern philosophy down the supply chain of the company. Through a winning strategy, Dippin’ Dots has secured this philosophy through the organization and made sure the suppliers have incentives of investing in continuous quality improvement. The primary part of logistics is supply chain management, with transportation as its critical part. As such, it is important to deliver the products to clients in a timely manner (Dippin’ Dots, n.d). Initially, the firm developed a distribution system where every product was located in the distribution center. Then, through partnership and collaborations, the organization improved its operations and logistical management.
Dippin’ Dots is a food vendor engaging in the sales of flash ice creams. As such, the operational costs do not involve warehousing and other complex logistical operations. Instead, the operations managers are mandated to apply the right strategies and concepts to improve the company’s performance (Abubakar et al., 2019). The costs, inventory, and reliability systems are the primary roles of operations and logistical management. Furthermore, the operations of Dippin’ Dots in any country must adjust to every country’s conditions.
The operations manager plays the role of overseeing the operational activities. The duties include training and hiring of employees as well as managing quality assurance programs. The operations manager is also responsible for strategizing process improvements to ensure every employee completes their tasks according to the schedule.
Human Resource management
The HRM’s objectives of Dippin’ Dots are defining the organizational structure that ensures productivity and developing effective coordination and communication in the company. These objectives are clearly highlighted by the company and particular goals and also implied through budgets and performance (Dippin’ Dots, n.d). As a result, the organization’s HRM was performing and motivated to improve the fit between employee and their job. This is due to the programs aimed at establishing harmony between job roles and employees. Thus, there have been consequential improvements in performance among employees.
In addition, the HRM ensures a competitive advantage for the organization through recruitment policies that ensure retaining and recruitment of top talent employees.
The organization compares to many top organizations by maintaining employee diversity by employing employees with varying cultures. Furthermore, the HRM attempts to adjust to the culture and conditions of the country to the organization’s operations (Dippin’ Dots, n.d). In addition, employees are offered international assignments to enhance their experience and performance through motivation and morale boosts.
HRM managers in Dippin’ Dots enjoy planning, directing, and coordinating the company’s administrative functions. Moreover, HRM managers perform the roles of recruiting, interviewing, and hiring new staff, consulting top executives on strategic planning, and serving as a link between the management and employees (Sołek-Borowska & Wilczewska, 2018). Therefore, HRM managers are vital to Dippin’ Dots as they direct and lead routine functions of the organization, such as interviewing and recruitment.
The information system objective of Dippin’ Dots includes recognizing and solving organizational and management problems. The information system aims to solve and understand maintenance, design, organization, and management problems to attain effective business. The objectives are clearly stated and consistent with the corporation’s objectives, policies, and missions (Dippin’ Dots, n.d). The company’s information system is efficient in providing useful databases and helping managers make routine decisions. Importantly, the information provides the organization with a good advantage over other competitors without advanced information systems.
The company’s information system is similar to most organizations’ information systems. The information system managers apply the right converts and techniques of evaluation to improve corporate performance through seamless communication and information distribution. Dippin’ Dots has an international information system with easy navigation through the website (Dippin’ Dots, n.d). The role of the information system manager includes the designing, managing, and monitoring of the information systems in various aspects. In addition, the information system manager oversees the staff that installs, plans, and maintains software and hardware upgrades.
Summary of Internal Factors
The most important internal factors are the corporate culture, information systems, and research and development. This is because these factors significantly impact the daily operations and processes within the company. As a result, Dippin’ Dots continues developing and enhancing these factors alongside the logistic operations and corporate structure for improved organizational performance (Dippin’ Dots, n.d). Therefore, given the missions and objectives of Dippin’ Dot, it is important to ensure robust revisions and concentration of technology and innovation.
Analysis of Strategic Factors (SWOT)
The initial strength of Dippin’ Dots is what ensured its fame, the innovative product. The company has reinvented ice cream, which has had a great influence on consumers. Additionally, the brand recognition of Dippin’ Dots offers the company a slight advantage over the competitors (Dippin’ Dots, n.d). Having a market share in the great and high-profile regions reestablishes the brand. Besides, having over 400 franchises enables worldwide organization advertisement, thus allowing for a more unified advertisement effort.
The first weakness of Dippin’ Dots is the increasing and extremely high prices of products. The high prices are a weakness due to the downturn in America. Additionally, Dippin’ Dots is also weakened by the limited locations with which they are able to sell their products. For example, the ice cream has to be served at sub-zero temperatures, making it a challenge to be consumed unless near retail locations (Dippin’ Dots, n.d). Additionally, the limited demography and target market also limit the profits.
An opportunity for Dippin’ Dots is that the move from out-of-home ice cream to one encompassing in the home is profitable. Exploring the market may be a challenge. However, if Dippin’ Dots can fix it, it can add a convenience factor to the product’s marketability (Dippin’ Dots, n.d). In addition, Dippin’ Dots can enhance its products for buying and freezing in-home freezers, thus enhancing evaluability and convenience.
Dippin’ Dots experiences a few threats, including the presence of different types of ice cream products. Most novelty ice creams may be located in local supermarkets at lower prices. This impacts loyalty or customers to the organizations (Dippin’ Dots, n.d). Additionally, competition from other organizations offering similar flash-frozen ice cream is an issue.
Strategic Alternatives and Recommended Strategy
The current objectives can be met by the simple, more careful implementation of strategies that are widely in use within the organization. There are various ways to improve Dippin’ Dots. One of the strategic alternatives will be focusing on the corporate structure (Dippin’ Dots, n.d). As a result, Dippin’ Dots will benefit through the energized workforce, not due to a loss of focus. Another significant strategy is target marketing, enabling Dippin’ Dots to capture market share that it has not already captured yet.
Dippin’ Dots should put more energy into its children’s consumers. Such a market segment is developing and growing at a high rate considering the possibility of missing out on the company’s larger market share. However, the downside of this strategy is the loss of focus due to the standard Dippin’ Dots customer (Dippin’ Dots, n.d). Lastly, Dippin’ Dots should also consider assessing loyal customers and the possibility of losing them. Should Dippin’ Dots meet its competitors on the above levels and strategies, it can ensure a larger segment of the lower budget market. However, the downfall would be the concern of losing focus on the high quality.
The selected strategies include increasing the children’s customer base for the corporate strategy, lowering the prices of the products and ensuring they are more economical, and establishing energy through a focus on corporate culture. As a result, Dippin’ Dots will capture a developing market globally by increasing the customer base. It has demonstrated a growing trend with children since children are becoming more resonated with ice cream products (Dippin’ Dots, n.d). However, this market has been untapped considering the number of mid-age children and the younger children as customers.
In addition, lowering the cost and prices of products while increasing the organization’s economy seems highly inevitable. The customer currently pays closer attention to the prices and efficiency rates compared to the initial years of Dippin’ Dots. As a result, consumers are worried about the economy regarding increasing the prices of the products (Dippin’ Dots, n.d). Dippin’ Dots should implement the strategy of lowering the prices to avoid falling too far below. This will ensure the organization gains an advantage over other flash ice cream vendors. Importantly, Dippin’ Dots can advertise the new advantages with promotions that will excite customers.
The last important alternative is establishing an excitement within Dippin’ Dots company by creating energy focused on employee culture. Having the employees concentrate on culture as well as energizing them with the tool will ensure Dippin’ Dots have better employees, thus a rise in quality and efficiency. Dippin’ Dots should implement this strategy, and it may single-handedly improve the organization’s status with outstanding performance.
With regards to the overall economy of the US, Dippin’ Dots must develop programs that will enhance its expansion efforts and broaden the target market. One of the programs that will enhance and ensure the achievement of the organization’s objectives is the creation of a non-seasonal product that can be marketed equally every year around. Such a program may include producing coffee dots (Dippin’ Dots, n.d). Additionally, a program should be implemented that conceals innovative breakthroughs and prevents competitors from stealing ideas. This will ensure Dippin’ Dots remains competitive through its innovation efforts as well as the research and development departments.
The organization’s top management and board of directors should implement the above programs. However, the development of the programs should be done by the departmental heads within the organization (Dippin’ Dots, n.d). Importantly the programs will be financially feasible as they will ensure the organization advances its market share maintain its competitive advantage while limiting operational costs. Furthermore, new standard operating procedures may be developed, such as a switch of the company’s slogan from “ice cream of the future” as the slogan is not as promising as it was in the organization’s early days.
Evaluation and Control
The current information system within Dippin’ Dots can ensure information and feedback reaches the intended, particularly on implementation activities and performance. However, with the current advancement in information technology, the organization needs to maintain a robust and feasible means of communication to enhance success (Dippin’ Dots, n.d). The information systems through the feedback are vital and efficient in measuring the success factors such as customer satisfaction improved employee performance through customer feedback, among other success indicators such as increased customer loyalty. Moreover, performance results can be pinpointed by function and area.
Control measures include protective precautions for protecting individuals from hazards within the workplace. Dippin’ Dots has established control measures and standards to ensure employees and workplace safety (Dippin’ Dots, n.d). For instance, the provision of protective gear for the employees to protect against possible harm. As a result, there is also adequate control of privacy and the flow of private information with regard to the organization.
Reward systems are an important strategy for any organization such as Dippin’ Dots. From rewarding loyal customers to rewarding hardworking and competent employees, Dippin’ Dots has established a reward system. For example, the Dot Crazy is a reward concerning the Dippin Dots and its products, experiences, and games for the club members (Dippin’ Dots, n.d). It is a way in which Dippin’ Dots rewards its loyal customers for their purchases and patronizes their company. Additionally, the organization has established significant benefits and rewards for employees, including perks and discounts, flexible schedules, and paid time offs that accumulate after a duration. These benefits ensure that the organization can retain its value and commit employees to ensure success.
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