Wednesday, January 28, 2009

College Term Papers

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NAFTA

As Reyna Elizabeth Montere states in Work and Health, Women at Risk "Revealing the Hidden Health Burden of Women Workers, "Mexican women are making a significant contribution to the national economy, but their quality of life has not enjoyed a corresponding improvement."The North American Free Trade Agreements Export-Processing Zones (EPZs) are filled with false promises and benefits. Although providing work for Mexico's numerous unemployed, the accord harms female workers on social, mental and physical grounds. That these factories are heralded as a forward movement for females is intensely ironic in its undermining of these factors. The provisions of NAFTA leave this to the Mexican governmentТs responsibility, as American and Canadian employers are legally unresponsible for the harms incurred. Moreover, were they to want to take action, it is often impossible under the terms of the agreement.

The accord heavily undermines traditional cultural gender roles without offering an opportunity for women to explore or establish a new communal identity. The idea of "machismo" in Mexican society emphasizes male dominance in the economic sector and restricts females to domestic labor. Female factory employees cite economic difficulties first and "machismo" second when asked what their concerns were regarding their employment.ii Women are also often hired based on traits generally associated with femininity. The initial draw of females as an employment base came as a result of their "docility" and "dexterity."Leslie Salzinger notes that "Gender and class positions are discursively linked."She elaborates later that, in accord with the stereotypes women are hired on, "To reframe the work as menТs work would be to define it as underpaid."Additionally men simply do not want their wives to work.iv Half of Mexican women are still homemakers. But even for those who have gotten jobs, the role of housewife is still their burden to bear. Even though they have been granted freedom of employment, the expectations that are placed upon them in the home haven't changed at all. "Gender roles simply were not considered in the NAFTA agreement. The growing needs for women to seek employment outside the home in order to support their families is a modern trend and NAFTA does not protect against the exploitation women suffer from foreign firms within EPZs.vi The heralding of these agreements as forward movement for Mexican females is ideologically sound at best. As long as women continue to work under conditions that further images of them as docile and submissive, EPZs offer little to them.

In addition to the reinforcement of gender roles that maquiladoras create is a prevalence of sexual harassment. Leslie Salzinger notes that this occurs both from fellow male employees and employers. Among workers there is heavy flirtation, though she carefully notes that women are pursued based on their appearances and docility, while men exclusively pursue. "On its production floor, male supervisors direct objectivized and sexualized young women apparently preconstituted in the home for use on the line," she writes in regard to the relationship between supervisors and female employees. The dichotomy women face is clearly illustrated when we examine the differences between being a good worker and engaging in the gendered social interactions that accompany the rampant sexual harassment in maquiladoras.iii It is argued by Ann Nauman and Mireille Hutchinson that the "only way women can gain access to positions of power and decision making is to have recognition of their sexual identity and its place in the real world and for there to be a change in the structure of power. "Until this happens, the sexual harassment in maquiladoras and reliance on gendered roles will continue to hinder women's advancement.

The number of females employed in Mexico nearly doubled between 1970 and 1993. "But the growing rates of employment for females are a double edged sword. It is reported in a recent study that 40 percent of Mexican females are unpaid or paid under minimum wage while 60 percent have no social security.vi Within maquiladoras, management positions are held nearly exclusively by males, while women, who are generally undereducated, accept lower wages. Additionally women receive lower level positions even when compared with men of similar educational background. Men also receive, on average, two-thirds more training than women. "Even jobs procured are rarely long-term sources of employment. Maquiladora jobs on average only last three years. Low pay and hazardous working conditions are attributed to this,vii in addition to the lack of compensation for long term work and seniority. "Because women are recruited heavily in rural areas their educational levels are especially low and they are increasingly unaware of their own rights as employees.vi Even among the jobs available, Ann Nauman and Mireille Hutchinson note a trend towards "masculinization of positions traditionally held by women in the workforce, "referring to a move towards computer skills in plant work. "Thus women achieve not even a significant financial benefit from maquiladora work to perhaps compensate for the compromises they are forced to grant as a result of their sex.
Unions are also often simply not an option to workers or not beneficial when they are allowed. "Unionization has been an uphill battle for Mexican workers, with government controlled unions often representing management interests and ignoring labor rights,"Ann Nauman and Mireille Hutchinson explain. Unions that are formed often have little presence in employees" day-to-day lives or are unknown to workers."Alejandro Hope, an employee of Mexico City based Grupo Economistas Asociados states unabashedly that Уwomen tend to unionize less, "as to why they are preferred for maquiladora work.iv Maquiladora workers state that they have "little faith that NAFTA will either raise wages or improve working and living conditions, as its supporters have promised. "NAFTA imposes no sanctions on a nation for refusing the right to unionize and thus, Mexico has no source of deterrence on the issue."

We cannot, however, dismiss this obvious disregard to Mexico's status as a developing nation. As Altha J. Cravey expands in his article The politics of reproduction: Households in the Mexican industrial transition, "The regulatory role of the state, which had nurtured domestic industrial capitalists and industrial workers in the old factory regime [central Mexico], has been completely revamped in favor of transnational capital accumulation. Social policy complements industrial policy in providing transnational corporations (TNCs) with a dependent and quiescent work force in the new industrial regions [EPZs]."

He furthers this by stating that employees in Mexico's older industrial zones, primarily located in central Mexico, expect social benefits within their communities."Mexico is obviously able to recognize the importance of these benefits and chooses not to in order not to compromise their relationships with the Transnational Corporations that have investments there. The United States and Canada have little ability to exercise control over the issue either. The provisions of the NAFTA agreement only require that a government follow its own labor laws. If a nation fails to follow its own rules a commission is established and sanctions may be enforced. The Mexican government simply doesn't admit that they are failing to follow their own legal provisions, and thus leaves NAFTA partners are virtually powerless. "That NAFTAs labor accords are undermined by the corruption of the Mexican government is, to some degree, out of Canadian and U.S. control.

Maquiladoras strike an issue with females much closer to their identities than job opportunities however. Pregnant women are often fired, married women are discouraged from applying and physical harm to their reproductive abilities is often incurred through their work in EPZs. Many factories require applicants to take pregnancy tests before receiving employment so that companies do not have to provide benefits that are required for maternal leaves. Additionally women are questioned regarding their sexual activity and birth control use.ii Workers employed by Zenith Electronics Corporation are hired based on their marital status (single women are almost exclusively hired) and must pass pregnancy tests to receive employment. "In 1998 the Mexican government publicly flounced the US department of LaborТs review of the legitimacy of mandated pregnancy screenings. The Department of Labor had concluded that such tests did, in fact, violate laws and should be discontinued. Mexico's labor ministry replied that requiring pregnancy tests was not in fact illegal as Mexican labor laws only applied to those already hired, not those who are candidates for employment."

If women do become pregnant and are not fired, their child often suffers health defects from lack of health care, long hours on the job and what are often harmful chemicals with which their mothers work. One plant, of approximately 200 workers, reported 4 anencephalic births and between 8 to 10 miscarriages during the period of April thru June. "Ann Nauman and Mireille Hutchinson cite a study done in 1990 which concluded that the birth weights of the children of women in Nogales maquiladoras as being lower than "internationally accepted standards and lower than those of infants born to women working in the service and commercial sectors in that city. "Additionally women working within maquiladoras often suffer from menstrual irregularities and miscarriages.vi Luisa Cabal, a coordinator for the Latin American Program at the Center for Reproductive Law and Policy summarizes the importance of the issue when she states that, УReproductive autonomy continues to be systematically violated. WomenТs bodies are still the war zone in which societal discrimination and the subordination of women are explicitly manifested."

Mexican women's are also often unable to form solid nuclear families within Maquiladora-based towns. In addition to being discriminated against on their marital status, they are often so underpaid that forming a family is economically out of the question. Most employees who inhabit squatter communities live with mixed generations and extended family in an attempt to make ends meets. "When women have already established families, childcare often becomes an issue. The government and EPZ employers do not provide childcare for employees. "22% of job turnover is estimated to be a result of childcare issues. Women often lock their children in their shanties while they work, or, in some extreme cases, have left their children at orphanages as a solution."

Reyna Montere identifies the numerous problems of maquiladora workers as "childcare, housework, domestic violence, poverty and sexual harassment "and further clarifies that, though this causes high mental stress and harm, the issue simply isn't regarded in view of the economic benefits Mexico achieves in return for their labor.i The Mexican government's blatant eagerness to cater to the United States and Canada's industries is paralleled in scope by their disregard for their citizens. Their defaulting of their contractual obligations with their citizens is especially harmful to the high percentages of females employed within the maquiladora industries. By allowing the reproductive and gender identities of their female population to be repeatedly undermined, they tacitly consent to the moral obligation that accompanies this. Although heralded as a liberating step for females, the prevalence of gender discrimination keeps any benefits of NAFTA few and far between for Mexico.

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Tuesday, January 27, 2009

Multiculturalism

Multicutural education has been a growing debate within school systems for many years. This has been a problem because their are so many students with diverse backgrounds are coming to school expecting to see some of their own culture being brought in the curriculum. The debate is that when students of different cultures come to school and do not relate well with the traditional curriculum they don't do well in that school. They end up being called "culturally disadvantage". When middle class white students are not doing well, it is often thought that there is a problem with the teaching method. This problem undermines the confidence of diverse groups. Teachers and society assume that the only thing wrong with diverse children is the environment that they live in. The problem rest with the school systems. They need to put different cultures within the schools curriculum.

The word "multiculturalism" is define as being, "a general desire or need for students to have something in the curriculum that relates to their own ethnic traits, if these exists, or to those of their parents ancestors". Culture is define in a way where "a particular group is categorized reality in terms of language, beliefs, values, customs, kinship patterns, skills , and dietary customs". This means that culture with itтАЩs different practices, and beliefs help diverse people make sense of the world. Culture and our whole outlook of the world are put together by our attitudes, values, opinions, and concepts. Also affect on how we think, make decisions, behave, and define events. For people to understand people from other cultures they need to understand their attitudes, values, and beliefs, and where they come from. They need to understand how racism and oppression effects them and how they cope with it. The education system has a responsibility to recognize and respect diversity because it's not going away.

The goal of multi cultural education is to teach students different cultural backgrounds so they can function in a diverse, cultural world, which is reality. The debate over multiculturalism is how to define the content and practices, along with what groups would benefit from it. Some researchers view multi cultural education as "specifically addressing bilingual, bicultural education, race and ethnicity". Multi cultural education shouldn't be categorized to fit one group, mostly the more oppressed or the most talked about minorities. Multi cultural education should be for all diverse and oppressed groups. The problem is that most teachers are not familiar with different cultures, so it starts with teachers. They need to be educated themselves. All the teachers not just the white one's need to be taught different cultural. A lot of teachers don't even know their own background. When the teachers are caught up with their education, then a multi cultural curriculum and can be created, which won't be easy. It requires sensitivity, respect, understanding and acceptance for ethnic social and cultural diversity. It also requires "an understanding that variations in learning experiences have an effect on a students achievement and performance outcomes". Students should benefit from this, to where it boost their self-esteem and academic and personal achievements. This program should be used to minimize stereotypes and prejudices, understanding one's attitudes in order to understand where that person is coming from.

Some states are already starting a multi cultural education program, such as New York. Teachers reported teaching materials on minorities and women. Others dealt with the Holocaust. "A survey of in-service workshops completed by New York State teachers in 1990-91 showed that far more had taken workshops on African History, black studies, ethnic studies, multi cultural education, and cultural diversity than of American and European History". As I said before it starts with the teachers education. How are they suppose to teach a multi cultural education program if they donтАЩt know anything about other cultural. You learn about Euro- American history starting in the 4th or 5th grade till your finish with school all together. The most you learn about other cultural, mostly deals with slavery, war , and protesting, which are all important no doubt, but it doesn't explain everything.

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Marx vs Locke

In Estranged Labour, Karl Marx sets fourth his conception of human nature as a species being. According to Marx, human beings are universal beings because of their ability to live in any environment by changing and preparing their surroundings. Marx differentiates human beings from animals in that animals produce only when doing so is necessary to their survival. Moreover, they produce only in ways that are fixed by their nature. However, human beings can produce many kinds of goods and in many different ways. According to Marx, human beings are unlike animals in that they engage in "free, conscious" productive activity. Their productive activity itself is a product of their will and they can make choices about what and how to produce. Therefore, "man is capable of producing according to the standards of every species and of applying to each object its inherent standard; hence, man also produces in accordance with the laws of beauty."

All four possessions from which we are alienated are related, in one way or another, to our productive activity. As beings who must be productive, human beings must interact with nature and other human beings to make things and effect changes in the world around them. This seems to be the central feature of human life for Marx. Thus to be alienated from our species being is to be distanced from our fundamental nature as productive beings.

Within a capitalist society, work is done for someone else and the worker lacks autonomy. Therefore, human beings are alienated from their species being. They derive no personal satisfaction from their work, in which they must engage to acquire the things they need. Work is not a source of self-fulfillment because it is non-rewarding and non-creative. People do not think of themselves as free, conscious, social producers but rather as being bound by the necessity to do unpleasant work that brings them into conflict with other people. Alienation from species being, then, is essentially misunderstanding the basic nature of human beings.

Essential to Marx’s account of human nature is the notion that people are not lazy – the notion that people enjoy work that challenges and encourages them to produce better products more efficiently. Unfortunately, the predominate worldview that portrays people as lazy slobs who would not work if food, shelter, education, health care, etc. were the guaranteed rights of all people comes to the surface in discussion after discussion of The Communist Manifesto. A worldview perpetuated to divide those lucky enough to find low paying dead end jobs from those not so lucky. However, according to Marx, Luck has nothing to do with it – those who are advantaged in the relations of production will always frame things in a way that perpetuates that advantage.

Marx regards an objective and universal conscious activity as the main ontological character of human being, a species being. Each man represents other men, i.e. each man as an individual contains mankind in his human essence. For Marx, every organism has internal relations with other existence through its objective activity. However, while the objective activity of animal is essentially limited, that of a human being as a conscious species being has universality, which reaches, to the whole world. Man produces not only his purpose and his enjoyment but also those of the whole world including his own species and other species. Marx considers that this universality of man leads us to be a free being.

Unlike Locke, Marx does not incorporate a necessity of God in his theory of human nature. Marx takes a materialist conception which begins with the proposition that "the production of the means to support human life ... is the basis of all social structure". Therefore, an individual's equality in relation to others is compliant in relation to the social relationship, which they are in.
Locke’s theory of the state of nature is that human beings are born in “A state of perfect freedom to order their actions and dispose of their possessions and persons . . .” and “A state also of equality, wherein all the power and jurisdiction is reciprocal, no one having more than another.” Locke believes that because human beings are created by God that man = man = man = man. Therefore, we have rights to those goods that everyone in the state of nature seeks – life, liberty and property. Locke’s argument is that we are all the workmanship of God. Thus, we are morally equal and should treat each other, as God would have us be treated. Thus, the law of nature must be equal: it must give every human being the same rights and duties.

The status of a human being, in Locke’s time, was based on sameness and the predominant worldview at that time meant that you had to be male, white, and protestant. Therefore, women did not share equal status with men. Women were human like but because they are different from men, they are not quite human beings. Therefore, Locke believed that males should rule in the state as well as the family. If women were to be considered human beings, they would have a right, in the state of nature, to retaliate against their oppressors and aggressors.

God creates all men being equal to each other and as a result, no man has the right to be supreme over any other. Because men are the workmanship of God who has created him, all men are morally obligated to follow the law of nature, which prohibits taking anyone’s life, liberty and property. Furthermore, man in the state of nature has an obligation to not harm others or another’s property. No one has any authority or right to exercise power over anyone else. In addition, if person A tries to injure person B, then person B has a right to retaliate and if detained against his will, punishment up to and including death is permitted. Moreover, because we are all equal, an attack on one man is an attack on all of mankind; therefore, all of mankind has a right to punish.

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Monday, January 26, 2009

Alcibiades

In Plato’s Symposium, Plato uses Alcibiades’ dialogue to display his frustration with the social expectations for love and his inability to meet those expectations. Alcibiades inability to involve himself in a productive sexual relationship demonstrates the impotence caused by the overemphasis of eroticism. The tragic nature of the character of Alcibiades is that he realizes he is unable to gain virtue through sexual relations, and therefore is forced to remain mortal and yet he is unable to change himself.

The Symposium is set during the Dionysian festival, immediately following the poet and playwright, Agathon’s victory in a play contest. The pageantry of this festival for Dionysus, the goddess of wine and fertility, emphasizes the Athenian expectations Alcibiades must confront. Athenians celebrated fertility and the reproduction of human life. Therefore heterosexual relationships were justified by its creative power. This emphasis created a social expectation that sexual relationships should be productive.

The guests of the party in the Symposium met during a festival celebrating the productivity and fertility of heterosexual relationships to justify their homosexual relationships by giving eulogies to love. Because heterosexual relationships were justified in giving birth to children, to justify homosexual relationships one would have to prove them equally productive. This forces Alcibiades to consider his own behavior in the context of these expectations and justify his sexual relationships.
Socrates tries to justify homosexual relationships by relating Diotima’s differentiation between heterosexual relationships, those who are physically pregnant with babies, and homosexual relationships, those who are pregnant in terms of the soul and produce virtue in their partner. This is done by the homosexual lover passing knowledge and wisdom on to his beloved. Thus, Socrates successfully justifies homosexual relationships and with this reasoning he demonstrates to the other guests that their homosexual relationships must be productive to be justified.

Despite Alcibiades’ many male lovers Plato describes Alcibiades as unable to achieve any productive sexual relationship because he fails to become the virtuous man that a productive relationship would produce. Alcibiades admits to caving “in to my desire to please the crowd.”(Plato 216B) Alcibiades is prevented from having a productive relationship by his sexual impulses and overemphasis on physical eroticism, which can be called his impotence.

Alcibiades’ overemphasis of physical eroticism is shown in his attempt to seduce Socrates. Alcibiades is more focused on the sexual act and the physical gratification that would come from it, than on the philosophical effect that the act would have on his soul. While Alcibiades knows that Socrates views the sexual act as a means of producing a more virtuous man, he pretends to actually understand how this happens only as a ploy to convince Socrates that their sexual relationship would be productive. Alcibiades said, “So what / I did was to invite him to dinner, as if I were his lover and he my / young prey.” (Plato 217C) Alcibiades demonstrates to Socrates that he fundamentally misunderstands the productive nature of sexual relationships, and therefore, will be unable to use any sexual relationship to improve his soul.

Socrates does not have a sexual relationship with Alcibiades because Alcibiades cannot engage in a productive sexual relationship, and Socrates is unwilling to enter such an unproductive relationship. Socrates attempts to explain this to Alcibiades: “You seem to me to want / more than you proper share: you offer me the merest / appearance of beauty, and in return you want the thing itself, ‘gold / in exchange for bronze’” (Plato 219A). Socrates is unwilling to help Alcibiades, not because Socrates is inadequate, but because Alcibiades is so corrupted that he could not be helped by any relationship.

This impotence in sexual relationships has greater consequences for Alcibiades than simply preventing him from having a sexual relationship with Socrates. As Diotima states, the product of a sexual relationship gives the partners immortality, either through children or virtue, “Reproduction goes on forever; it is what mortals have in place of / immortality.” (Plato 207A). Because Alcibiades cannot accomplish this, he is doomed to mortality.

The tragedy of Alcibiades’ impotence is that he realizes his inadequacies and yet is unable to change himself. Alcibiades’ inability to understand the productivity of sexual relationships leaves him in a state of unending frustration, as he understands that he lacks virtue, but is unable to become virtuous. Despite the lessons Socrates attempts to teach him, Alcibiades remains unable to understand Socrates’ reason for not having a sexual relationship with him.

Plato further supports his depiction of Alcibiades as frustrated about how sexual relations are the way to becoming virtuous, by alluding to Alcibiades’ comparison of Socrates as the flute player Marsyas, a mythic half-man, half-goat flute player always depicted with an erection. It is not simply praise of the power of Socrates’ speech. “The only difference between / you and Marsyas is that you need no instruments; you do exactly / what he does, but with words alone.” (Plato 215D) Rather, he is demonstrating his jealousy of Socrates’ sexual productivity. The comparison of Socrates with Marsyas, is an intentional act demonstrating his sexual jealousy.

Plato’s subtle use of Alcibiades’ dialogue and relationship with Socrates to portray Alcibiades’ tragic inability to become virtuous through sexual relationships demonstrates the impotence resultant of overemphasizing erotic relationships. Alcibiades’ inability to have a productive sexual relationship condemns him to mortality. The tragedy of the character of Alcibiades is both his comprehension of his lack of virtue and his inability to change himself.

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Intel Corporation

Intel Corporation harnesses and implements the many forms of technology to gain substantial profits in an ever-growing technological age. As we have seen throughout our lives, technology has grown faster than any other market segment known to man. Far less than a century ago we were showed our first personnel computer, whose primary function was for word processing and simple mathematical calculations. Now, with the growth of technology, we have improved those primary functions along with gaining computers that can surf the Internet, check email, and even fly planes.

Like any other life-changing event, technology had to be captured and sold to consumers who wanted to be on the edge of discovery. Intel Corporation strives to be the leader in the technological industry. In order for Intel to set this benchmark for themselves, they must constantly be aware of changing technology and have a fast and decisive response to new innovations. Intel incorporates their needs for awareness and response time by establishing venture capital programs. These programs not only finance suppliers for a stable source of quality suit for Intel’s design and manufacturing but also companies that show Intel the possibility for a future strategic advantage.

Berkeley Networks, a receiver of Intel’s financing, is a start-up company who is developing promising open switch architecture to compete with the routers and switches of the dominant market segment players. Through the strategic vision of Intel, Berkeley Networks is a promising investment into the future of networking interface. However, through numerous miscommunications between the managements of Berkeley Networks and Intel and the inquiry by an outside suitor for a possible acquisition of Berkeley Networks, there have been several problems. Keith Larson, manager of Intel’s Corporate Business Development Group (CBD), is faced with a major decision that can dramatically affect Intel’s position in network interfacing. It is the purpose of this paper to expose the relationship between Intel and Berkeley Networks and to propose a possible solution for Keith Larson.

What is Intel’s strategy with their venture fund?
Intel Corporation is faced with changing technological trends that it must understand and implement if it is to pose a serious strategic advantage in Intel’s market segments. Intel captures current and future technological trends through its efforts in venture capital funding. Through Intel’s capital stature, they are able to support, through their Corporate Business Development Group, staff that manage the variety of invents in technologies and services related to Intel’s product offering.

At first glance, Intel started to protect themselves with a stable source of quality inputs, for its design and manufacturing processes, by investing in external companies. This was a smart move by Intel because it allowed them, through their financing leverage, to clearly set a standard of what kind of inputs they desired through suppliers. The preemptive quality check assured Intel’s products the highest quality set to specifications.

Intel’s most important exploration into venture funding happened in the 1990’s where they started to adopt a “market eco-system” approach. With major technological innovations on the horizon, Intel smartly adopted polices of financing where they sought after software and hardware developers that related to Intel products, in turn creating opportunities for both parties. Intel’s CBD group focused their efforts on companies that would not necessarily provide a monetary return but companies that would support their strategic vision. Intel was making a great leverage move by aggressively growing their investment portfolios into companies where they can take advantage of their products on the basis that, “What does Intel get out of the money they supply?”

Very few start-up firms, which Intel was aiming at, had significant capital to support the necessary research and design needed to complete most projects. I believe Intel knew this fact and indirectly took advantage of these start-ups in order to protect their future interests in maintaining a competitive advantage in their market. With no other choice but to acquire loans and possibly fault on the loans, many firms, with cash flaunting in their face, accepted Intel’s offer with the promise that both companies would benefit. The end results in the venture fund between Intel and a start-up was one of two things: (One) Intel would realize that incorporating a startup into their own business would benefit them more than continually investing in an external company. (Two) As Intel continues to draw information from a start-up firm, the information will eventually become exhausted and as Steven Nachtsheim says, “It may realized that it’s time to cut bait when it no longer makes sense.”

Intel’s mission to acquire a diversity of external investments has led them to classify investments in two tiers. Tier one investments are those that provide Intel with a “direct” strategic impact and tier two investments provide Intel with “potential” strategic benefit. Intel’s obvious strategy in their venture funding is to satisfy their strategic interests into gaining insight into new technologies. While positive financial returns on investments are not frowned upon, Intel will compromise monetary value if an investment satisfies an interest in strategic importance. In opinion, behind Intel’s goodwill approach is a side where Intel is acquiring all aspects of their market segment and indirectly creating an environment where all competitors, without enormous sums of capital, cannot compete. Monopoly.

How well is that strategy working?
Intel’s venture funding strategy is working very well for them. Through their acquisition they have gained insight into many technologies that Intel itself does not want to work on. Intel knows that they are benefiting from their acquisitions because they are aggressively pursuing more acquisitions to diversify their portfolio. In return for their funding Intel receives the latest technological innovations and also puts themselves in a situation to dominate a particular market segment.

Why did Intel decide to invest in Berkeley Networks?
In the beginning, Yavatkar, one of Intel’s engineers, was trying to fade away from the vertical networking architecture and move Intel towards a more powerful horizontal networking architecture. Although both Intel and Berkeley Networks were using Microsoft’s Windows NT operating system, Intel themselves did not produce the switches needed to complete their project. Berkeley Networks, through the due diligence of Intel, proved to be much more advanced in their design of switches. Intel decided to invest in Berkeley Networks on the basis that Larson and Yavatkar’s review of the company and its products showed Intel valuable exposure to developments in programmable network technology that Yavatkar’s team had been working on internally, as well as the potential to indirectly spread the adoption of Intel’s new IA chips. The desired result would be the creation of a new market segment for Intel.

Berkeley Networks, with the use of Microsoft’s Windows NT operating system, was developing a breakthrough technology that was capable of generating new communications architecture. No other start-up company, including Intel, had the design or product that BN was working on. Berkeley Networks and Intel both understood the “potential” strategic success in this new communications arena. Intel’s indirect vision of controlling all aspects of technology led them to invest in BN because they felt an investment would not only grant them insight to BN’s technologies but also a controlling share of all products produced. Intel knew that if BN’s designs were adopted they would be the founder of a new revolution of networking technology. Intel saw this opportunity not only in a strategic matter but also in the future monetary rewards it would permit.

Why did Berkeley Networks invite Intel to invest?
Berkeley Networks was trying to improve the speed of feed into and out of a switch. BN accomplished this by loosely integrating Microsoft’s Windows NT operating system with their own programming tools. After a successful first round of financing, BN was now looking for a second round of financing to complete their project. Berkeley Networks founder, president, and CEO, Ravi Sethi was focusing his attention on a venture fund that would allow both firms to benefit from each other’s knowledge, skill and product base. The corporation of choice, for Sethi, was Intel.

Sethi believed that the relationship between Intel and Berkeley Network’s would enhance any products and create a synergy between the two firms. Aside from the corporate strategies that each of the firms discussed, Berkeley Network’s secretly wanted to use their relationship with Intel to get closer to Microsoft. Since Microsoft’s Windows NT operating systems was the base of BN’s switch architecture, Sethi wanted BN to have a strategic advantage over competition by having a backdoor into the system in which is was based upon.

What is Intel learning from its investment in Berkeley Networks?
The relationship between Intel and Berkeley Networks was different from any other relationship Intel had participated in, with the fact that the deal was compressed relative to Intel’s normal investment timetable. Although the deal was concluded in less time, Yavatkar’s support for the deal, backed by his technical discussions with BN engineers provided Intel with a degree of confidence. This degree of confidence, however, was short lived.

Prescribed by the short nature of the deal conclusion, there were many issues, not discussed in the deal completion process, which Intel would face. As Larson recalled, “there were no specific ‘gives or gets’ related to Intel’s licensing or OEMing of BN’s technology.” Intel found it very difficult to fulfill its goal of learning more about the switches and the horizontal networking technologies. Despite the fact that Intel was not allowed to serve on the board of BN, all information was acquired through direct meetings with BN’s engineers and/or management. Unknown by Intel, BN was intentionally withholding strategic information because they feared that the corporate conglomerate would take advantage of their technology and not give due respect. This strategic decision by BN created an ordeal of miscommunications that eventually led to a mass of dissatisfaction between the two.

Intel takes away from its investment in Berkeley Networks one major fact. Although BN showed to have potential strategic applications for Intel, no matter the circumstances, Intel needs to follow a strict set of guidelines when coming up with a venture plan. Intel should not have concluded the deal with BN in a shorter time frame. If conducted correctly, the investigation and deal processes of Intel might have revealed issues that pertained to Larson’s “give or gets.”

What is Berkeley Networks learning from Intel?
Berkeley Networks had an entirely different strategy than Intel. BN’s ultimate goal was to gain a closer relationship with Microsoft. The relationship between Intel and BN simulated a poker game where BN, for instance, would bluff its information and it was then up to Intel to decide what information BN provided and if that information was valid. Through this business poker game, Berkeley Networks learned that if you play your cards right, the underdog can get what they want by taking advantage of given situations.
What should Keith Larson do?

Keith Larson is faced with a decision that can have dramatic affects on Intel. Berkeley Networks has informed Larson that they have a serious suitor for an acquisition. Larson must take into account the circumstances of his decision alternatives. Larson can decide upon three things: (One) Drop Berkeley Networks completely and realize a lose, (Two) Invest in a third round of financing, hoping to attain more information, or (Third) bring Berkeley Networks into Intel.

Larson knew that Berkeley Network’s offered Intel one way toward their goal of a horizontal communications architecture that would feature Intel microprocessors as an important component. Larson also felt few people understood that the networking and communications industry had the potential to “horizontalize” large chunks of the industry and that he knew from Yavatkar that Intel was interested in BN’s architecture for internal switching projects; it is my recommendation that Larson purchase Berkeley Networks and bring them within Intel. The potential for BN to strategically help Intel was known from the beginning. If Intel purchased BN, they would no longer have any miscommunications between the two firms and no longer have to debate about the exchange or information. Acquiring the company also insure Intel that no other company can purchase them and use BN’s technology against Intel.

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Sunday, January 25, 2009

Insurance Planning

In the ever evolving business world there are many choices for a consumer to choose from when it comes time to consider future plans. When it comes to life insurance a customer has an abundance of plans one can select that best suits their needs and families needs. Has one grows older the choices out there seem to diminish as does the time to for decision making. It is important to address these situation early and life and have a plan for the future, whether it before saving for retirement or taking a plan out for an untimely death, it is vital to know ones options and be as best prepared as one can be.

With the ever growing expense to bury someone nowadays it is important to be prepared to lessen the burden on family members that have to not only morn ones death, but in some cases pay and arm and a leg to get one six feet under. Selling life insurance to someone today and can be very hard to decide what type a policies can fit ones needs and wants. In making a educated decision on buying a policy it is important to consider ones status in life and obligations that one might have.

When I started to research on life insurance policies I noticed that I am at a premium for companies and they are more than willing to work with me setting up a policy. I first looked into types of insurance that I would need and noticed I had an over whelming number to choose from. I looked into three different types term, whole life, and group insurance.

I first looked at term insurance, which basically put covers one for a certain period of time. I had many choices when it came to term insurance. I could get one with a renewable that gave me an option after the term came up. I had one that could give me the same premium for a certain amount of years that appealed to me. Also, I found a policy called a conversion policies that would allow me to convert to whole life insurance with a higher premium, it would be good since I can’t afford the higher premium at this point in my life.

At looking at whole life insurance I noticed that I couldn’t really find a policy that could fit my current situation. I had many to choose from, but since I don’t really know what kind of situation I will be in 5 years it was not to my benefit to take a plan until my future was a little more stable. I did notice it is important to start early if I wanted to take out a whole life policy, since the payments would be lower and I could receive a better premium.

The third type of life insurance I looked into was group life insurance, which can be best put as an insurance that one can get through a company they work for. The problem with this insurance is sometime the one can get a better premium with an outside agency and these plans are not as flexible as other term or whole life plans. These plans are best for certain person who is limited in what they can do and or are not able to financially make a decision at the time.

Ad it came time to decide on a plan that best suited me I brought into consideration my needs. Since, I am a full time student that still lives at home, with two working parents that both have insurance policies that still cover me till I am 25. I also, have no dependents of my own, I think it was best for me to not take a plan out at this time. But upon graduation in 2 years it would be to my greatest benefit to begin my own insurance policy and at that time I would begin an adjustable whole life plan that can increase or decrease my coverage as my life and outcome changes.

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Inflation and Unemployment

In the following paper, we are going to assess inflation and unemployment with the Internet article, People Prefer Inflation to Prospect of Job Loss. Justin Wolfers, an assistant professor of political economy at the Stanford Graduate School of Business, is the author of this article. In this analysis of the article, we are going to provide definitions of inflation and unemployment. Then, we are going to consider the economic impact of the main points in the article on the economy and society’s feelings toward unemployment.

In order to provide a clear understanding of our article, we are going to define the terms inflation and unemployment. According to David Colander, inflation is “a continual rise in the price level” (Macroeconomics, p. 148). This reflects how much the prices in an economy have risen over time. The increase of prices of goods over time is the price index; therefore, the price index is a measurement of time compared to the yearly measurement of inflation. To calculate inflation, we are using the price index for a year’s time. Currently, economists are using the year of 1984 as a base, and inflation represents this increment over a period. The next term we are defining is unemployment. According to the William King on-line dictionary, unemployment refers to the condition of being with out a job or to the proportion of people who can and will work but are unemployed (William King, 2003).

With the definitions of inflation and unemployment, we are now going to assess the economic impact of the main points in the article on the economy and society’s feelings toward unemployment. The economic impact of unemployment is the possibility of recession. According to Justin Wolfers, “Recessions really hurt, and the governments and their central banks need to be aware of the importance of avoiding them” (pg. 1, 2003). When unemployment rates are at its highest rate since August 1994, the results are alarming to the economy. In the U.S. economy, there is a total work force of 145,801,000, and there are 136,783,000 people currently employed. This means that there is an unemployment rate of 6.2% (Labor Force Data, 2003). This unemployment rate affects not only the unemployed people, but also employed people. The employed people start to feel as though they can loose their job at anytime. With this job uncertainty people feel, people would rather save money than spend money, which creates financial insecurity that has a negative effect on the economy.
Now that we have determined the effects on the economy, we need to consider the effects on people’s sense of satisfaction. Justin Wolfers has done research on how the effects of inflation and unemployment affect people’s satisfaction. Justin Wolfers gathered data on life satisfaction compared to the rates of inflation and unemployment from different European countries and the Unites States from 1973 through 1998. This research shows us that people feel more stress when they cannot find a job than when prices are rising. From the information contained in the survey, the research shows that rising joblessness is roughly five times more troubling to people than rising prices. High unemployment rate in a region, according to Wolfers, “lowers average feelings of usefulness, confidence, and happiness and raises depression and feelings of worthlessness”(pg. 1, 2003). People also feel a loss of faith in the government, corporate sectors, and banking sectors, which can lead to a recession (Wolfers, 2003).

In conclusion, we have assessed inflation and unemployment with the Internet article, People Prefer Inflation to Prospect of Job Loss by Justin Wolfers. We provided definitions of inflation and unemployment to help explain the content of the article. Inflation is a continual rise in the price level, which took the price index’s measurement of time over a year to calculate inflation. Finally, we considered the economic impact of the main points in the article on the economy and society’s feeling toward unemployment. The financial insecurity has had a negative effect on the economy because of job uncertainties. Since people were saving their money, the prices did not increase keeping inflation from increasing. The research showed that people felt more stressed when they could not find a job than when prices were rising. People felt a felt less useful, confidence, and happiness and there was a raise in depression and feelings of worthlessness.

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Saturday, January 24, 2009

Importance of Employment Relations

Employment or human relations covers all types of interactions among employees such as cooperative efforts, interpersonal and group relationships. The purpose of employment relations it to deal with the people the business employs and the issues arising from their employment. Acquiring, developing, maintaining and motivating staff are all aspects that are covered by the employment relations area. Employment relations are necessary as the employee is the most important part of a business and any troubles that affect them in turn effect the business.

Realising the potential effect that employees have on the business, Companies are providing incentives and programs to keep their employees happy and productive.
‘A happy worker will work twice as hard and more efficient than an unhappy worker.’
Incentives provided for e.g. are (case study) Coca Cola providing twice the amount of shares in their company that the employee purchases, (case study) McDonalds providing employees discount purchases from companies that are connected to McDonalds.
Programs such as employee dinners, lunch, Christmas parties, weekends away are all effective in keeping the employee happy and to build relationships with fellow employees so to work better as a team.

Business managers have come to recognize that their employees are the most important part of a business and through effective management a business can gain the competitive advantage. The skills, knowledge and creativeness of employees is the main potential that a business has over it competitors and thus the realisation that the employee has the most influence over important aspects such as its profitability, competitiveness and adaptability has led to the idea that managing these human resources to develop their maximum capabilities. Human resource management or employee relations is the process of finding the people the business needs, developing their skills, knowledge, talents, careers. Motivating and maintaining their commitment to the business.

The relationship between the employee and the business will vary depending on the businesses culture (How things are done around here) and must be determined wisely as to produce maximum efficiency and effectiveness. E.g. (case study) Shelf packers at the local grocery market packing shelves in groups of two to three people. While packing shelves workers would chat and not concentrate on task at hand. By splitting workers up into each istle each worker could work more efficiently but was unhappy at not being able to talk to fellow employees which led to poor work ethic.

The way in which a business communicates this ‘culture’ to all employees is extremely important as employees must know what the business is about and where it is heading if the business it to be successful in achieving its prime goal.

After WWII and the influx of younger people to the workforce new approaches in human resources were made. The younger workers valued their jobs and were more motivated. Education of employees was considered and came to recognise that a workforce is better educated and skilled.

Completing in secondary schooling and tertiary courses increased thus showing that the workforce was looking for more challenging jobs.
Women’s role in the workforce soon grew with higher divorce rates, women’s rights and laws removing discrimination toward women. Managers soon had to give more consideration towards discrimination and child rearing.

In its simplest form employment relations is described as the effective management of the formal relationship between the employer and the employee. With management realising the potential of this many businesses have created approaches to enhance that factor. Acquisition and selection, development and training, maintenance and motivating, separation of staff. These are all approaches which can be taken.

Acquisition and selection is the gathering of information about each applicant for the position and then using that information to choose the most appropriate person for that position. The chosen applicant must be able to do the job perfectly and thus management must first identify staffing needs.
Training and development is needed for employees as to teach staff to work efficiently and effectively. Training must be continual so skills are not lost and to provide maximum efficiency.
Maintenance and motivating of staff is to keep staff within the business and to work to the best of their ability. A relaxing and friendly work environment, decent wages and benefits are all needed. Without this staff will leave the business and thus require new employees, resulting in more training, poorer efficiency and decreased workload, in result the business wastes needed resources and becomes less productive. Motivating employees is highly important as motivated employees result in increased productivity. The carrot and stick approach in which the carrot is the reward (money/pay rise) and the stick being punishment (demotion/fired) has been widely relied on as a motivator.

Money is seen to be the biggest motivator but in recent years this has been found not to always be the case. Work conditions, time of work, fellow employees all affect motivation.
Separation is the ending of an employment relationship and this comes in many ways. Dismissal is when the employee contract with the business has been suspended due to the employee not doing their job properly or behaving unacceptably.
Redundancy is when the employee is no longer needed and leaves on their own will or not. Retrenchment is when a business is unable to pay their employee and thus they must leave.

Employment relations is a key function in which business must manage to improve their employees and thus lead to improving their business. With good human resource management a business can gain the edge they need. Without good human resource management a business will probably not succeed.

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Impact of Internet on International Marketing Practices

This paper will discuss the impact of Internet on the international marketing spectrum. One way to analyse this issue is through identifying the pros and cons of using internet as a marketing tool, and finally its implication for international marketers, professionals and academics.

Information technology has been the cataclysm for the development of international businesses. One area, which has been given increased attention, is the explosion of international marketing activity on the Internet. According to the international data statistics of 2003, they predict that there will be approximately one billion of active users in the world by 2005, which means more electronic commerce (www.cyberatlas.internet.com). These figures demonstrate the attention of international marketing stakeholders.

The usage of Internet as a medium international marketing brings along many benefits to international marketers. Some major advantages are mentioned below:

Firstly, the net acts as a gateway to global opportunities. It allows companies, specially small and medium enterprises to position themselves globally at low cost. In addition, it alleviates the red tape regarding the prospect of doing business globally, consequently avoiding the regulations and restrictions in export countries, which normally companies should abide by if they physically enter the market ( Paul, 1996). Furthermore, low cost can also be associated with the elimination of intermediaries because Internet connects end-users to producers directly. Moreover, the global advertising costs which was considered as a barrier to entry, is now reduced as internet permits to attain the target audience cheaply ( Eid & Trueman, 2002).

Secondly, it provides accessibility. Companies which use internet for their international operations are able to increase their hours of business through email and customer ordering and interactive communication (Eid & Trueman, 2002). Although the different time zones which exist, they have increased their opportunities by providing 24 hours access for their branch offices and consequently this results in an increase in the number and potential international customers (Paul, 1996). In addition, the one to one interaction allows marketers to build strong and sustainable relationships with their customers, which as result enhance the brand loyalty (Arnott & Bridgewater, 2002).

Thirdly, the net contribute to an appropriate form, place and time utility which create a competitive advantage to the marketeer . Instead of exasperating the customers with the different types of marketing approaches, the choice is given to the customers to decide when, where and what they want. All the company’s products are provided on the net which increase the chances of trial, purchase and repurchase (Paul, 1996).

Fourthly, the net enhances advertising effectiveness. Through Internet advertising media, it is possible to achieve all advertising purposes across all possible market segments. All concerned parties can create, transmit and access advertisements on the net through a computer and appropriate software ( Paul, 1996). However, the effectiveness of the advertisement will depend on a well design and effective marketing of the site (Hamill, 1997). Moreover, Poon and Jevons(Eid & Trueman, 2002:57) argued that hard selling and push promotion strategies are not effective on the internet.

Lastly, the net improves market intelligence, market research and analysis. Studies show that the success to enter new market is systematically to gather, analyse accurate and timely information. The Internet provides up to date information on customer contact, potential market opportunities, technical reference materials which help managers to identify shifts in product and customer trends (Hamill, 1997). Ultimately, it enables managers to capture the right product and market opportunities, from which they can mold an appropriate marketing mix relative the customers’ needs (Paul, 1996).

As there are benefits of using Internet for international marketing purposes, so there are some disadvantages as well. The following shows two main constraints that affect international marketing.

One important issue concerning Internet marketing is security. As millions of people access the net everyday, Copyrights and proprietary information can be target of computer hackers and viruses. Moreover, there is also the risk that they can access the internal computer system and find out classified information (Paul, 1996). Another security issue is the financial transactions that occur over the network. By using unencrypted package, computer hackers can view the credit card number of the purchaser and cause terrible financial damages. Nevertheless, statistics show that the Internet crime rate is on the decreasing rate due to an increase in security features (Palumbo & Herbig, 1998).

One another major limit for the use of Internet as tools for international business is the structural constraints. In order to make proper use of Internet as tool for export, it is dependent on the absence of structural constraints. These constraints can take the form of computer literacy, culture, language; ownership of Pc’s which affect the efficacy of internet –based international business strategies. For instance, all the parties involved in this particular type of transaction should be computer literate and have access to equipments. Secondly, the Internet network should be easy and affordable to access. Thirdly, regulations that impede access to Internet should be removed. For example, in china, only those who register to the public security Bureau and employees of foreign companies can have accessed to internet ( Samjee, 1998).

The above discussion on the pros and cons of Internet on international marketing affect profoundly the major international marketing stakeholders in three aspects. Firstly, international marketers should consider Internet as cost-effective tool for export and if it use appropriately can be a competitive advantage for the company. Secondly, the internet-based businesses bring up some important issues to international marketing educators. The traditional teaching of fundamental international marketing like barriers to internalization, importance of intermediaries, country screening is no longer valid. The internet requires a different radical strategic approach to this new cyberspace environment (Hamill, 1997). Lastly, international marketing educators need to ensure that their students are familiar and understand the strategic implication of Internet in order to prepare them in this new cyber world characterized by international electronic commerce.

Hence, if a business is considering internationalizing, it should consider Internet as an option. Even than there are some risks associated with its use, the benefits may outweigh its disadvantages if it is use appropriately.

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Friday, January 23, 2009

Global Culture Changes

Synopsis of key issues in this case
ARPCO operates in a global environment; however, ARPCO does not have a shared culture that crosses borders. The local culture has a stronger influence on the way business is conducted than the corporate culture, which is proving to be a major challenge for ARPCO management. Due to corporate culture immaturity and undefined values, ARPCO cannot support the growth of its most talented people on a global level.

If APRCO does not address the culture crisis, legal matters are bound to evolve and corporate image will be tarnished. Ultimately, this would lead to negative impacts for APRCO’s bottom line and would significantly reduce its ability to attract and retain talented people.

What is the challenge Wollen faces in making the decision to promote Lewis? What is her responsibility to Lewis?
The challenge Wollen faces in making the decision to promote Lewis is whether she can break through the culture barriers and obtain buy-in on a plan that supports Lewis in the new position. The culture barriers are strong, as can be seen with Abbott’s resistance to accept Lewis after learning of his race. If Wollen and Lewis decide to move forward with the promotion, a well thought out plan approved from the top will be required to ensure success for Lewis and for ARPCO. Without the proper support, Lewis could fail in a job that he was well prepared to do, which would be painful to Lewis and his family.

Wollen has three major responsibilities to Lewis. First, she should make him aware of the key risks and challenges associated with the new position. Second, she should describe to Lewis her commitment and ARPCO’s commitment to support him in the new position. Third, she must follow through on her commitment to support Lewis. Ultimately, the decision to accept the opportunity or not should be made by Lewis after the risks have been clarified.

Is it always wrong to consider gender, race, and ethnicity in promotion decisions, even if the “equal” opportunity might end a manager’s career?
Gender, race, and ethnicity should never be considered in promotion decisions. The decision should be based instead on an individual’s qualifications. In this case, Lewis was intelligent, hardworking, experienced, creative, and a top performer on the fast track who was the most qualified for the new position. Therefore, Lewis should be given the option to accept the position regardless of his race.

Evidence that promotion decisions should never consider gender, race, and ethnicity can be found in the Nineteenth Century Civil Rights Act. The Nineteenth Century Civil Rights Act provides protection against employment discrimination, which includes discriminatory practices such as bias in hiring, promotion, job assignment, termination, compensation, and various types of harassment. Additionally, the courts have ruled in such cases that employers need to meet a “but for” test. In other words, the employer must prove that the same employment decision would have been made for the same reasons regardless of sex or minority status (Walker, 1992, p. 10).

Since globalization is a very real environment factor in business, what are the challenges U.S. corporations face in the changing environment?
As the environment changes to increasingly conduct business in a global framework, U.S. corporations are challenged with shaping corporate culture for the new workplace. Immigration, technology, emerging markets and economies, mergers, joint ventures, strategic alliances and foreign investment have brought all the world’s citizens to one another’s doorstep. People must now learn to communicate, work and compete with others who are not like themselves.

“Companies may be putting an emphasis on creating diverse workforces, but more minorities claim they are facing barriers to promotions once on the job” (Armour, 2001, USA Today.com) According to Armour, the number of employees filing federal claims regarding discrimination in promotions based on race has nearly doubled since 1990. Further evidence includes a 1999 poll by Society for Human Resources Management, which concluded that nearly 75% of employers say that minorities face barriers to advancement.

Companies that do not provide shared cultural values will loose competitive position in the global marketplace. “A Fortune magazine survey found that CEOs cite organizational culture as their most important mechanism for attracting, motivating, and retaining talented employees, a capability they consider the single best predictor of overall organizational excellence.” (Daft, 2003, p. 94)

What are the risks associated with Lewis’ promotion?
There are a number of risks associated with Lewis’s promotions, which impact Lewis, Wollen and ARPCO. The first is that Lewis could fail in a job that he was well prepared to do, which would be painful to Lewis and his family. The second risk is that if Lewis fails then ARPCO’s corporate image could suffer. Thirdly, if Lewis fails in the new position it will be reflected in Wollen’s performance record. Finally, if his promotion is passed over, then the company is subject to a discrimination law suit and Lewis may not remain long with ARPCO.

There are many risks associated with Lewis’ promotion and each could potentially be very detrimental. The only foreseeable way for ARPCO to reduce its risk and create an environment that eliminates future risk, is to reshape the culture for conducting business in the global arena.

What are the benefits to Wollen and to the organization if Lewis is promoted?
If Lewis’ promotion is successful, then ARPCO and Wollen would realize significant benefits. For example, ARPCO would avoid legal issues and improve corporate image through increased diversity, which would enable them to attract and retain talented people. Wollen’s benefits would include recognition for developing Lewis and for moving the company’s diversity and culture a big step forward. Wollen would also gain self satisfaction with helping Lewis progress is career.

What managerial skills would you use (if you were Wollen and you did promote Lewis), to insure the optimum benefit to all the “players” in this situation?
Only one key managerial skill stands out, that would insure optimum benefit for all, and that is Human skill. The Human skill required in this case is made up of leadership, mentoring, and relationship building.

Through leadership and mentoring, both Lewis and Wollen benefit. Lewis would have the advantage of an “assistant coach” and he would have the needed level of trust and confidence to be successful. Wollen would benefit personally and professionally.

Through relationship building, both Lewis and Abbott benefit. If Wollen develops a relationship with Abbott, then she helps reduce the culture gap. A well developed relationship would also provide support for both Lewis and Abbott when issues arise.

Recommendations
The global business environment has presented major challenges for ARPCO. In order to retain competitive position, avoid discrimination law suits, create a diverse workforce, attract talented people, eliminate bottom line impact, retain key employees and fully leverage intellectual capital, ARPCO needs to create culture change. Unless the culture crisis is addressed, ARPCO will continue to have difficulty conducting business in the global arena.
It is recommended that a Culture Change Plan be developed. Upper management must approve and sponsor the plan. Human Resources will facilitate the program and leverage middle managers to execute the plan. A proposed plan has been created and should be used as a starting point. See Table 1 for the proposed plan.

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General Dynamics Strategy

Anders’ strategy creates value. Some of the value created is obvious: Shareholders benefit from increased share price and dividends. This includes any employees who own stock or stock options. And of course, the twenty-five executives in the gain sharing program receive value from their incentive payments.

Less obvious is the value to society created by downsizing. Any excess capacity GD has, including human resources, is not creating value. (By definition, otherwise it would not be “excess.”) When GD sells assets or releases employees, other companies can put them to use in value-creating activities. If the cash that GD receives from selling assets or reducing payroll is paid to shareholders then that money is available to invest elsewhere. This is the Coase theorem in action: resources are allocated to their highest-valued use, and society benefits overall.

But not everyone benefits. Employees who are released lose value if they are not able to find another job offering the same utility. If these employees had specific knowledge that was valuable to GD, it may not be as valuable to other employers. While GD probably paid them for both their time and training, that will be small comfort to those facing lower wages.

However, the 90,000+ employees who remain with GD enjoy better long-term security because their employer is in better financial health. If GD had kept employees to do work that did not add value, many more employees would likely have lost their jobs in the long run.

GD should retain the gain sharing program, though it may opt to make cosmetic alterations to make it more palatable to employees, shareholders, the public and the government.
Gain sharing appears to be a successful incentive: the executives created value for shareholders by making difficult and unpopular decisions to downsize the company. If the gain sharing program were eliminated now, it would damage trust, and reduce incentives to make difficult value-adding decision in the future.

Critics of the program claim that the executives can manipulate the stock price by exploiting information asymmetries, or that it provides incentives to make short term gains at the expense of long term company health, or that such large payouts are unfair given that many employees are losing their jobs. Strangely, these same critics did not complain about the even larger gains executives had from appreciation of their stock and stock options. ($2.7M in appreciation for each $10 rise on Anders’ options alone, according to exhibit 7)

It seems unlikely that short-term stock price manipulation occurred. Given that the incentive program is public knowledge, the market should discount the GD stock price somewhat to account for overly positive communications from GD executives. Short-term manipulation of gain sharing would not benefit executives who had more at stake in stock or stock options. (Unless they sold out at the peak, which would certainly be a tip off to the market and might garner rather unfavorable attention from some serious-minded people at the SEC.) And future gain sharing payments depend on maintaining any gains to reach the next hurdle.

To improve appearances, GD could extend the 10-day window to make short term manipulation of the stock price less likely. They could also smooth out the bonus formula to reduce arbitrary levels and make timing less important. For example, the payments could be 10% (or 20% after the first $10) of base salary for each one dollar increase of the average closing price over each quarter. This may work out about the same for the executives, but unfortunately may be a less compelling incentive simply because it is more complicated and less immediate.

Another option is to grant new stock options that exactly duplicate the performance of the gain sharing program. (Basically, set the option price equal to the last gain sharing hurdle reached and grant a number of options equal to 1/10 of the dollar value of the executive’s salary.) The drawback to options is that executives must exercise the options (in effect, selling stock) to get cash, whereas gain sharing provides cash (or at least half of it) up front. Since the executives have no other cash bonus, this could mean that executives sell stock more often to raise cash for themselves, which might have a negative effect on stock price.

Of the two alternatives, stock options would probably be the least controversial (it gets rid of “gain sharing,” and nobody has complained much about existing options) and would be the easiest to implement. Our preference would be to keep the gain sharing program intact. But if the compensation committee believes that public and employee relations would improve enough to offset the disadvantages, then options are probably the best choice.

3) Assuming that the twenty-five executives who participated in gain sharing were the people who would face decisions about downsizing, it was appropriate to limit the incentive to these people. Twenty-five seems like a small number of executives for a company the size of GD. We would expect there to be a larger number of people who would be faced with difficult decisions about reducing employment. But without more detailed knowledge of the organizational structure, we cannot more specifically assess who should have been included.

Perhaps the GD model was that only very top executives made decisions about selling assets or reducing employment. Still, to be effective, these executive would need to rely on their subordinates to provide suggestions and information and to execute the decisions. Therefore, some kind of value-based incentive for these “rank and file” employees seems appropriate. Lower level managers did benefit from stock options, and most employees were encouraged to participate in a stock purchase program. These seem inadequate, but apparently were enough, given GD’s success.
Executives should be rewarded for selling assets and reducing employment when it adds value, as described in our response to question one. The rewards should be based on specific and measurable results that clearly demonstrate value added. Stock price, while not perfect, is the collective determination of what a company’s future cash flows are worth, and it is the best long-term measure of a value available for a public company. Measures based on sales, earnings or other accounting measures are short-term, narrow, and open to manipulation through unscrupulous accounting practices, as recent events have shown. Temporary information asymmetries (like cooking the books) may exist, but eventually the market catches up.

The extent of the reward should be enough to motivate the managers to make the necessary decisions, and no more. There is an information asymmetry problem here in that managers might be willing to do the same job for less. (For those of us who do not make millions of dollars each year, it is hard to imagine how a couple million here or there make a big difference.) Furthermore, the number of qualified executives for a given position is often small, so creating a self-selection scenario can be problematic. The best that companies can do is to be very clear on what is expected and then negotiate for the best price.

So, it is possible that GD could have paid less to their executives and gotten the same results. We have no way to tell for certain. But note that the gain sharing bonuses paid to GD executives seem relatively cheap compared to the overall value added: $17.8 million for $1.2 billion, or about 1.5 cents per dollar.

There may have been viable alternatives to the downsizing strategy pursued by Anders at GD. For example, the company might try to produce its way out of trouble, as Lincoln Electric did in the previous case. It might enter other markets and retrain its workers. The company might also pursue total liquidation or sale: if a company is more valuable to shareholders dead than alive, managers are obligated to end it.

But none of these alternatives seems likely to be more successful. Unlike Lincoln, GD faces declining demand in a very uncertain market, and is not already focused on a core competency. GD and its competitors have a history of poor performance in diversification efforts, and there is nothing to indicate that this will change. While GD could theoretically attempt to restructure itself to be more efficient in serving its current markets, what new structure would offer it the “critical mass” necessary to compete more effectively in those markets?

In short, if GD cannot find a strategy to compete in a market, it is better off exiting that market and returning any residual value to shareholders or reinvesting it where a promising strategy exists. One could argue that Anders and the executives were not good enough at developing better strategies, but given that they fared better than their competitors, it seems likely that they judged correctly.

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Thursday, January 22, 2009

Brave New World

The novel Brave New World by Aldous Huxley is a compelling tale of future society, which is controlled by a totalitarian government that challenges the very idea human individuality. The book takes place in the period of “AF”, After (Henry) Ford, in London, England after The Nine Years War has revolutionized the way the world is run. In this time period of science and technology, humans are no longer born, but manufactured, given lessons as children through hypnopaedic sleep teachings, categorized into five social castes, and given soma pills that take them on happy mental vacations to relieve them of the stresses of everyday life.

The first of the main characters is Bernard Marx, a lower class Alpha who fails to compare to other Alphas in physical stature. He is rumored to have had alcohol in his blood surrogate, making him physically inferior for his social caste. He does not possess typical views on life and questions traditional views on all aspects of life. While on a trip to the Savage Reservation in New Mexico, Bernard meets a primitive man named John. John is an outcast from the Indian culture he is living with. He and his mother Linda return with Bernard to London to experience this ‘brave new world’. John does not fit well in modern society, having all his worldviews derived Shakespearean plays. John soon becomes quite a spectacle because of civilized people’s curiosity towards savages. Meanwhile Linda is considered hideous because of her physical appearance and her motherhood.

At the other end of the spectrum from Bernard is Helmholtz Watson, a professor at the Emotional Engineering College. Watson is the pride of the Alpha class, having superior physical attributes. However he wishes he could make more of his writing and use his time in more worthwhile ways. He and Bernard Marx form a friendship based on their dissatisfaction with society. The last important character is Lenina Crowe, the average, typical Alpha female. Lenina’s views on sex and soma are model opinions of the World State. She is deeply attracted to John, but merely on a sexual basis, while John wishes for a deeper relationship and eventually rejects her.

The modern world portrayed in this novel really is a sad indication of what our world might become someday based on our devotion to science and technology. Even though many scenes in the book can be quite shocking, it is not that far out. The World Controllers (government body) often resemble ideas of communism, the German culture in the years of Adolph Hitler, and the feudal period of the Middle Ages. The communism is supported by such hypnopaedic lessons as “Everyone works for everyone else”. Plus it is no coincidence that Bernard Marx’s character is modeled after Karl Marx, one of the founding fathers of communism. The process by which imperfect embryos are discarded in the cause of manufacturing perfect ones is really an alternate form of Hitler’s genocide. The five social castes are similar to the Feudal Age hierarchy, except that instead of nobles, clergy, and peasants, social classes are represented by Greek letters.

The new methods that are used to control the world populations go to rather sad extremes in order to maintain control and keep everyone happy. One of the most popular techniques is hypnopaedia. Through this process people are conditioned from infancy into late teenage years to accept their social class and deal with many other aspects of life. While giving students a tour of the Hatchery and Conditioning Centre in London, the DHC (Director of Hatcheries and Conditioning) explains the brainwashing procedure he likes to call conditioning. He shows the students an occasion in which Delta infants are electrically shocked while looking at flowers and pretty picture books. The goal is to mold their instincts to associate these images with terror and pain. Other lessons in caste awareness teach the kids to identify the classes by the color they wear and their function in society.

Another tool the World Controllers use to manage the planet is the limitation of books and science. Since these things stir emotion, and emotion can lead to instability, they are withheld from the people. Instead the World Controllers institute shows called feelies to provide a source of entertainment. Similar to movies, feelies give the people a source of artificial happiness. After John and Lenina attend a feely together, Lenina emerges from the show bubbling with excitement and joy. On the other hand John is rather disappointed, describing the show as horrible and ignoble.

The people have been censored from all knowledge deemed to old or too hard for them to understand. Near the end of the book World Controller Mustafa Mond discusses with John the type of books the people are allowed to read. John is shocked that the beauty and truth of Shakespeare and Othello’s writing is forbidden to the people. Furthermore the identity of God has also been removed from the information given to the citizens. Instead of God people follow Ford. Since the book was first written in 1932, the author chooses Henry Ford to be the new world symbol for the AF years. Mustafa Mond explains how God has not changed, but the people do. This therefore requires a new supreme being for the people to follow.

Brave New World is a compelling story of what the world may someday become because of our desire for science and technology. Some consider it a warning, while to others it is only science fiction. It makes one wonder if the future of our world will ever go to such extremes to ensure happiness. Abolishing our individuality to conform to society? Ridding ourselves of all past famous literature? Taking antidepressant pills everyday to keep ourselves content? Anything is possible for the future, but only time will tell.

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Friday Night Lights

Friday Night Lights, by H.G. Bissinger, is about a classic example of a small town in Texas, a town called Odessa. Odessa is a town like most Texas towns, it was founded because of its oil, every body seems to know each other, and the Hispanics and Mexicans coming over the border have flooded it. But there is one more thing about Odessa. This is football.

Odessa has one of the greatest high school football programs in the country. Students from other states come to Odessa, just to get a chance to play, or watch a football game at Permian High School. Despite the great legends Permian High School has earned over the years of its football, there are also consequences.

Football is the only thing that brings the town together. People live for Friday night. Every player has his own life, but the center of it is football. Each of the players has their own peppette, a high school girl, devoted to them. These girls make a huge sign to put in the player’s yard for the season, posters for the game, cookies and other sweets, and they put on huge pep rallies every Friday morning. For almost every single Odessa Resident, if there weren’t a football team, they wouldn’t have anything to live for.

This town may sound unreal, but its values are extremely important to the residents. Once you are out of high school, your life just drags on, until you have children, and once again you can relive the Permian High School glory days of football.

High school football was the absolute most important aspect in the town of Odessa. Money was spent around it, the football coach was paid $48,000, while the head of the English department, with a master’s degree and twenty years of experience was paid $32,000. The football coaches were given brand new computers almost every year, while the school had just received its first computer. $70,000 was spent every year for chartered jets to a football game at Midland High School, which was 500 miles away from Odessa.

Racism was also a huge dispute in Odessa. Ever since the desegregation of schools, there had been problems in Odessa. Although a black or Hispanic football player would be given the same respect on the football field as anyone else, off the field, things were usually different. Black and Hispanic families were often treated with racism. Odessa had been rated one of the towns with the highest murder rates of blacks and Hispanics.

Academics were also another factor much less important in Odessa than football. Most of the time, teachers would teach for the first ten minutes of class, and then for the remaining forty minutes of class, they were given time to basically do whatever they wanted. Teachers along with the students thought nothing could top the Friday night game. There was no academic probation for students, if they couldn’t even reach the bare minimum. Many of the players had the knowledge of a twelve year old. Trying in school didn’t matter; performing on the football field was what mattered. If the football team did well, the town was content, despite its low scores on standardized tests. If the football team did bad, more emphasis was put on forgetting the test, and working on plays and getting ready for the next game.

In conclusion, this book goes to show that although high school football can be a great experience for a high school student, it shouldn’t be the center of a town. But it is in some towns still today. It is a terrible example for a town to be okay with the way schools don’t care about it’s student’s grades, only about whether or not the football team will win the state championship that year. A town in America shouldn’t revolve around the Friday night-lights.

In the book, Friday Night Lights, I learned a lot about how some towns emerge. Many small Texas towns were founded strictly for oil. Before long, these towns filled up with wild cowboy men, looking for bars (which became very popular businesses in these small towns,) and prostitutes, which were also in high numbers.

The town of Odessa was split in two, like many towns in Texas. There was southern Odessa and northern Odessa. Southern Odessa was mostly run down cheap houses, where mostly blacks and Hispanics lived, and northern Odessa was a richer, white section of town, where almost everyone was racist.

Not only was the town split, but the high schools were also split. There was Permian High School, for mostly northern Odessa white children, (in 1988, when the book takes place, the school was made up by 69% whites, and 23% Hispanic, with the remaining 8% blacks or other ethnic groups.) There was also Odessa High School, which was for mostly southern Odessa Hispanic and black children.

This town, like many others, was extremely reliant on the oil. In 1981, a record 4,530 drilling rigs were running the United States. Ten months later, that number dropped to 2,379. Unemployment increased, and banks, especially the First National Bank, which got into hundreds of millions of dollars in debt.

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