Month: April 2017

Nowadays, consumers expect more from a firm than just its products. Businesses are expected to be socially responsible and transparent, and produce and deliver the goods in an ethical way. A post from the blog “My New Neighbour” deals specifically with its issue, with respect to the example of Pantagonia.

Corporate Social Responsibility or CSR refers to the “business practices involving initiatives that benefit society” According to the blog, Patagonia’s “humble honesty, transparency, commitment, and diligence with corporate social responsibility [is] groundbreaking and necessary.” Patagonia’s “love of wild and beautiful places demands participation in the fight to save them”. This also translates into “a love of people, with Patagonia having a robust involvement in corporate social responsibility of it’s factories in all tiers of production worldwide.”

This ethical practice relates to the way of decision making of care. The ethics of care can be stated as “the morally correct action is the one that expresses care in protecting the special relationships that individuals have with each other.” Pantagonia focuses on fulfilling this “care” with its effort to help the environment and the people.

Pantagonia pays close attention to every step in the supply chain. “Over the past four years, it’s beefed up its social responsibility office and enlisted Verité to help it with additional audits. It’s increased its investment in corporate social-responsibility efforts by about nine fold over the past five years, and has been working on initiatives internally as well as trying to broaden awareness and cooperation about problems across the industry…. when I spoke with experts on the issue of forced labor, Patagonia’s name continually came up as one of the few brands that seeks to take the high road by choice rather than necessity ”

Our society’s needs are also changing to place greater importance on social awareness. In our world now, businesses are held to higher expectations than just making profits. Consumers expect businesses to be transparent and ethical in their actions, and to create positive social impacts, with regards to education, health, and the environment even while making profits.

For businesses, a corporate social responsibility is a source of motivation and a point of differentiation. Nowadays, it is common for businesses to start out because of a social need. Successful entrepreneurs identify what is missing in our society and work to bridge that gap. Businesses seek to leave a positive, lasting change in people’s lives, instead of being lost in the influx of organizations.

The Chief Executive Officer of Papa John’s, John Schnatter took an interesting stance when he shared that executives, managers and subordinates should be paid the same amount of dividends to positively effect their workplace behaviour. As a result, “ In 2015, $60 million in bonuses was divvied up between workers at all levels of the company.” (Taylor) Schanatter, himself, obliged to only receive a third of his worth as value by the company, and wants the remaining profits to be rewarded to the employees. (Taylor)

In her blog, Natasha Widjaja’s presents the view that this is “definitely a guaranteed way to drive the workforce.” (Widjaja) Yet, her evaluation seems to focus on the effectiveness of bonuses in general, rather than focusing on the practice of awarding employees of all level in the same way. I agree that, through the needs theory, that bonuses will motivate, but, as the two-factor theory states, it would not be effective after the employees’ basic needs are met. That applies to all financial incentives awarded in any way.

The focus of this policy is that executives, managers, and subordinates are paid the same amount. In theory, it seems to make sense. This places an importance on the organizational climate, which is the shared perceptions of organizational members about their work environment. This view effects the organizational culture, as the organization can be seen as more people-oriented and supportive of all employees, not just the upper management (Langton et al.) This leads employees to be content that everyone is rewarded the same way, regardless of their level in the organization, which creates an increased level of teamwork and a positive climate. This climate is strongly related to job satisfaction, involvement, commitment, and motivation, which benefits the organization and the employees (Carr et al.)

However, in practice, this will not be effective. According to the expectancy theory and the value of instrumentality, employees need to believe that their performance will lead to increased rewards. (Langton et al.) But if employees of all levels get the same reward, there is no extended reward associated with a high level of performance. Therefore this link will be broken and the employees will no longer be motivated to strive for excellent performance.

Moreover, the equity theory explains that this policy may even discourage the upper management. The equity theory states that employees compare what they get from their job to what they put into it. They take the ratio of their outcomes to their inputs and compare it to the ratio of others, usually someone doing the same job. (Langton et al.) If an upper management member sees that his equals in different organizations are getting paid better than he is, then he loses his loyalty to Papa John’s and his motivation to continue working hard. The idea of paying all employees the same level of dividend may seem as a positive, ethical practice, but its real effects are against the interests of the organization.

 

Carr J. Z., Schmidt A. M., Ford J. K., DeShon R. P. (2003). Climate perceptions matter: A meta-analytic path analysis relating molar climate, cognitive and affective states, and individual level work outcomes. Journal of Applied Psychology, 88, 605–619. doi:10.1037/0021-9010.88.4.605 Google Scholar CrossRef, Medline

Langton, Nancy, Stephen P. Robbins, Tim Judge, and Katherine Breward. Organizational Behaviour: Concepts, Controversies, Applications. Toronto: Pearson, 2016. Print.

Taylor, Kate. “Papa John’s CEO Says Executive Salaries Are ‘immoral’ and Give Corporate America a Bad Name.” Business Insider. Business Insider, 26 Jan. 2017. Web. 03 Apr. 2017. <http://www.businessinsider.com/papa-john-schnatter-slams-overpaid-ceos-2017-1>.

Widjaja, Natasha. “The Effectiveness of Money as Motivation.” Blog post. Natasha Widjajas Blog. N.p., n.d. Web. 02 Apr. 2017. <https://blogs.ubc.ca/nwidjaja/>.

Most people have had the experience of shopping at common retail stores, and being faced with customer service that did not meet the expectations. Many problems could arise, such as rude clerks, over-friendliness of staff, and messy stores. Yet, we often forget to consider the retail stores from the clerks’ points of view, and the problems that they may face in their workplace.

In her blog, Ritvika Sharma, presented some interesting viewpoints on the level of friendliness retail workers should possess. First, she has a valid point in stating that the attitude of the clerks are very important, as customers will connect the value of the business by their experience with the clerks, as most customers never meet any other employees or upper management.

Moreover, she states the possible problems that could arise from over-friendliness or under-friendliness. If a clerk is too friendly, it can come off as fake and excessive, but if he is not friendly enough, the customer will view the store as an unwelcoming place. Being just “friendly enough” will give the store many advantages, as it can build loyalty, increase referrals, and be known for the customer service. Yet, focusing too much on the friendly customer service could lead to lack of innovation, and increasing costs.

Yet, she overlooks the fact that landing right in the middle of these two extremes can be very challenging for clerks. Customers’ needs are always changing, which means “your customer-focused business needs to have the resources, such as financing, staffing and time, to constantly keep up with customer demands.” It is often difficult to figure out exactly what level of friendliness is needed, also because it is different for every customer. Some people value it when clerks come and try to help them, while some shoppers would prefer to be uninterrupted. It seems it would be near impossible for the clerks to figure it out at first glance, and they may come off as too friendly or too inattentive.

Further, it is hard to agree with the author’s viewpoint that culture decides the level of friendliness that is needed. As a Korean-Canadian, I have shopped in both Korea and Canada, and in other countries such as the US, Mexico, Ireland and China while travelling. I never noticed that the attitude of the clerks differ based on country, but more on the type of the store that you enter. If I enter a night market or a market place in Asia, I would expect the clerk to be more verbal and friendly, and to come and talk to me first. On the other hand, if I enter a retail store, wherever the country is, I would expect a short greeting and occasional “can I help you”s, but I would not expect someone to come and make a conversation with me. If I am at a department store, I would expect a friendlier but formal customer service. Through my experience, I had felt that the adequate level depends on the situation, rather than the country.