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China, like many Asian countries, has been known as a source of cheap labor. The newest generation of Chinese workers differ from their parents in that, while they are still willing to work for wages much lower than the average American, they are more aware of what constitutes fair working conditions. Increasingly, the Chinese government, which controls many businesses and the one official labor union, is having to deal with issues related to working conditions.

QUESTIONS:

1. Given what you know about the pool of available workers, do you believe it is easier or more difficult to attract a quality workforce in China than it is in the United States? State your reasons.

2. While the laws governing business in China create a different climate for human resource management, Chinese workers are really not much different from American workers in terms of what they want from their jobs. What are the demands identified in the article? How do these compare to the keys for maintaining a quality workforce listed in your text?

3. Discuss the differences between labor representation in the United States, where the government maintains an independent posture when it comes to business and unions, and China, where the government controls businesses and the union. Which system is most effective?

SOURCE: K. Chu & M. Yun, “Wages, Conditions Improve as Workers in China Form Unions,” USA Today (Retrievable online at http://www.usatoday.com/money/world/2010-11-19-Chinalabor_cv_N.htm)

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After days of resisting rising international pressure, on Sunday Ireland officially applied for an IMF and EU bailout worth tens of billions of euros. The terms of the package are still being negotiated, but the bailout package would be used to address the nation’s ailing banking industry and rising public debt. Ireland had been hesitant to accept international financial assistance due to concerns about any “strings” which would come with the bailout package and concerns about how global investors might react to any bailout. Other European countries were eager for Ireland to accept international assistance due to concerns about how Ireland’s financial crisis could spill over to impact other euro-zone countries. No exact figures were announced on Sunday, but the package may be in the high double-digit billions.

QUESTIONS FOR DISCUSSION:

  1. The term contagion is used to describe when significant economic crises in one country spread to other countries. One of the reasons EU government leaders were placing pressure on Ireland to accept a bailout is because the value of the euro was being negatively impacted by the troubles in Ireland. Ireland is the second euro-zone country to receive an international bailout this year. To what extent do you think that this second bailout will avoid further contagion versus make it so investors become even more concerned about the possibility of yet another bailout in other weak euro-zone countries such as Portugal or Spain?
  2. Evaluate the extent to which you believe that the mere act of creating a contingency fund for Ireland will be enough to calm investor fears and to stop the drain on deposits which are squeezing Ireland’s banks. Is it possible that Ireland may never need to draw on the funds, or at least not all of the funds?
  3. Loans from the IMF generally have conditions or “strings” attached. For the first euro-zone bailout, the IMF and EU imposed substantial budget cuts on Greece, policies which have been met with public protests and violence. Give that Ireland has already slashed its budgets and has implemented other reforms, would further spending cuts be beneficial or detrimental to its economic recovery?
  4. Irish Finance Minister Brian Lenihan stated on Sunday that an increase in Ireland’s corporate tax rate of 12.5% was “off the agenda” as a condition of a bailout package. Critique the advantages and disadvantages of Ireland increasing its corporate tax rate to be comparable to the other euro-zone countries.

SOURCE: Ireland Applies for Bailout (Retrievable online at: http://online.wsj.com/article/SB10001424052748703567304575628362883493310.html?mod=WSJ_hp_LEFTTopStories)

Related video clip available at:
http://www.reuters.com/news/video/story?videoId=164159079&videoChannel=1

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Wal-Mart, the world’s largest retailer, reported its third-quarter profit rose 9.3 percent from a year earlier to $3.44 billion for the quarter ending October 31. Despite weak U.S. sales, the company raised its full-year profit outlook as the retailer expects continued gains from its robust international sales. U.S. domestic namesake stores saw same-store sales fall 1.3% and profits increase 1.9%, while international sales jumped 9.3% and earnings increased 14%. The firm’s international operations now account for about a fourth of the firm’s annual revenue. It was the sixth straight quarter for same-store sales declines in the United States. The firm’s low-income customers continue to struggle in the weak economy and the firm has worked its way through merchandizing and management changes. Wal-Mart seeks to broaden its international operations, which according to Chief Executive Mike Duke continue to “deliver impressive results.” Mr. Duke cited China and Japan as growth markets and said India was an up and coming country for the company. In order to attract U.S. customers, Wal-Mart is moving away from aggressive price cuts and returning to its “Everyday Low Prices” strategy which worked well in the past. The firm previously announced it would offer free shipping on more than 60,000 products bought over the Internet during the holidays. This holiday season will be crucial for Wal-Mart since it appears to be losing U.S. customers to its competitors including Target, German grocer Aldi, and bargain-basement “dollar stores.”

 QUESTIONS FOR DISCUSSION:

  1. Wal-Mart has indentified China, India, and Japan as potential growth markets for its international operations. Discuss the challenges Wal-Mart is likely to face in its operations in these countries.
  2. In the United States, Wal-Mart continues to see a pronounced pattern of paycheck shopping where consumers shop at midnight as soon as their paycheck or unemployment checks post to their account. Identify potential opportunities and challenges this shopping pattern might create for the firm.
  3. Wal-Mart is offering free shipping on more than 60,000 products bought over the Internet during the holidays. Analyze the advantages and disadvantages of this marketing tactic.

SOURCE: Bustillo, M. (2010, November 17). Wal-Mart sales show rivals at its heels. Wall Street Journal, p. B3. (Retrievable online at: http://online.wsj.com/article/SB10001424052748704327704575613861567263350.html)

RELATED ARTICLE: Sanchanta, M. (2010, November 15). Wal-Mart bargain shops for Japanese stores to buy. Wall Street Journal, p. B1. (Retrievable online at: http://online.wsj.com/article/SB10001424052748703560504575612141078994842.html)

Related video clip available at: http://online.wsj.com/video/news-hub-wal-mart-profit-rises-9/66D96152-92FA-41D0-86C3-5E21794BDD2D.html

Related video clip available at:
http://online.wsj.com/video/digits-will-you-ever-pay-for-shipping-again/6D08F24F-FAC9-40E1-A1C8-3BEE7F622061.html


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In the wake of a massive bailout from the U.S. Government, General Motors finds itself in a precarious position. What must the company do to survive? One answer seems to be turn to foreign investors. Chinese automaker SAIC Motor Corporation may be willing to pay $500 million to acquire a one percent share of the company. GM indicates it will offer up to $1 billion in stock to asset management funds in the Middle East and Asia.

QUESTIONS:

1. Are rumored moves by General Motors suggestive of global management or something else?

2. Ignoring GM’s present situation, why would the company enter into a joint venture SAIC? What are the advantages to the arrangement for SAIC?

3. What are the potential drawbacks to increasing foreign investment in General Motors?

SOURCE: S. Terlep, “Chinese Plan to Buy Stake in GM,” Wall Street Journal (Retrievable online at http://online.wsj.com/article/SB10001424052748704865704575610771579286344.html)

Related video clip:

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When the U.S. Senate and House of Representatives adjourned prior to the most recent election, they did so without making any decision about extending the tax cuts set to expire on January 1. President Obama campaigned in 2008 on a promise to allow tax cuts to the wealthiest Americans to expire. Now he finds himself at an impasse with a new Republican-led House and the Democrats holding the slimmest of margins in the Senate. The President must do something or risk having increased taxes push the country deeper into recession. Republicans argue that the election shows support for their party and want to extend the tax cuts for all. The lines are drawn. The question now becomes one of how to proceed.

QUESTIONS:

1. Does the current impasse on taxes represent emotional conflict, substantive conflict, or both? Inability to resolve this issue is dysfunctional conflict. Can you provide general and specific reasons why this is true?

2. What is the fundamental cause of this conflict?

3. President Obama is calling on Republicans to compromise. Is this a good approach? Why or why not? What is the optimal approach for dealing with conflict? How could this be achieved on the tax issue?

4. On this particular issue, the substance goals are specific (to this issue) while the relationship goals are general (i.e., extend beyond the current issue). What are the substance goals? What are the relationship goals? It presently appears the negotiation on taxes is distributive. If it continues this way, what criteria of effective negotiation are being violated? Is there any way to turn this into a principled negotiation?

SOURCE: L. Montgomery, “Obama Seeking Compromise on Bush Tax Cuts,” Washington Post (Retrievable online at http://www.washingtonpost.com/wp-dyn/content/article/2010/11/12/AR2010111206030.html)

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Retailers typically hire temporary workers to help meet increased demand during the holiday season. Forecasts for 2010 suggest this type of hiring will be considerably higher than in recent years. Some researchers suggest this is a sign the economy is picking up.

QUESTIONS:

1. Examine the legal issues surrounding human resource management. What are the pros and cons, both for the companies and employees, of hiring temporary workers?

2. Discuss the differences in recruiting between temporary workers and full-time employees.

3. What implications do temporary workers have for developing a quality workforce at retailers such as Toys R Us and Kohl’s? Is this a concern?

SOURCE: D. Hunsinger, “Holiday Hiring May Signal Good Tidings for Economy,” USA Today (Retrievable online at http://www.usatoday.com/money/economy/employment/2010-10-10-holiday-hiring_N.htm)

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The Group of 20 industrial and developing nations met this week in Seoul, South Korea for the G-20 annual summit. The G-20’s efforts to coordinate economic and trade policies were complicated by the fact that some members are running large current account deficits, while others are running sizeable current account surpluses. Some nations are worried about deflation, while others face rising inflation. The value of the U.S. dollar is falling, while the Japanese yen, the British pound, and the euro have gained against a stable Chinese yuan.

The lack of significant progress at the summit suggests that the United States seems to be wielding less clout on the global stage. The results of the recent U.S. elections suggest that domestic support for President Barack Obama and his programs seem to be waning, and this may be impacting perceptions of Mr. Obama in other nations. Mr. Obama failed to finalize details of a free-trade agreement with South Korea before the self-imposed target of the start of the G-20 meetings. The U.S. economic recovery is anemic, while Brazil, China, and India are recording solid economic growth. Mr. Obama faced widespread criticism about the Federal Reserve’s decision to inject $600 billion into the U.S. economy by buying U.S. government bonds over the next eight months in an attempt to drive down interest rates. Many countries have concerns about the Fed’s action, which is likely to drive down the value of the dollar, drive up the value of other currencies, and hurt the export sectors of other countries. Nations want the United States, as a major reserve-currency issuer, to consider the impact of its monetary policies not only on its own national economy, but also the possible impact of these policies on the global economy.

The summit concluded with little progress on the two most contentious issues of exchange rate policies and trade imbalances. The members provided a communiqué indicating that they will continue over the next year to make progress toward more balanced trade and market-determined exchange rates, but no specific numerical targets were announced. The United States had proposed that countries should limit their current account surplus or deficit to no more than four percent of the nation’s GDP by 2015. China and Germany were reluctant to agree to any proposal which quantified limits on current account surpluses and deficits. The delay in defining targets for external imbalances may contribute to the simmering trade and currency wars impacting the global economy. The countries did make progress on developing a framework for regulating the world’s financial system to avoid taxpayer bailouts of banks and called 2011 a “critical window of opportunity” for progress on the Doha round of WTO negotiations.

QUESTIONS FOR DISCUSSION:

  1. Evaluate the extent to which the G-20 annual summit in Seoul can be considered a success. What challenges will be created by waiting a year for the next meeting before holding high-level talks to address perhaps the most contentious issues facing the G-20—exchange rate policies and trade imbalances?
  2. Discuss how the fact that President Obama failed to reach a self-imposed deadline for finalizing a trade agreement with South Korea will impact his success with his domestic agenda and his goals for the broader global economy.
  3. The United States faces widespread criticism for the “quantitative easing” policies of the Federal Reserve and the fact that the Fed is injecting another $600 billion into the U.S. economy. Compare and contrast the monetary policies of the United States and of China with its heavily-managed currency. Is this criticism of the United States deserved?

SOURCE: Weisman, J., & Paletta, D. (2010, November 12). U.S. wields less clout at meeting. Wall Street Journal, p. A8. (Retrievable online at http://online.wsj.com/article/SB10001424052748703848204575608024073731214.html)

RELATED ARTICLE: G-20 Delays Imbalance Deal. (Retrievable online at http://online.wsj.com/article/SB10001424052748703848204575609551819168026.html)

Related video clip available at:
http://www.reuters.com/news/video?videoId=164091319&feedType=VideoRSS&feedName=Business&videoChannel=5&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FUSVideoBusiness+%28Video+%2F+US+%2F+Business%29&utm_content=Google+Feedfetcher

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Moe Stein is the second of three generations of Steins running Frank’s Sport Shop in Bronx, New York. Moe possesses a throwback style – a sharp wit and ready one-liners that he flings at any and all customers. In this day and age of big chain stores, Frank’s is nearing its 80th anniversary. Stein must be doing something right.

QUESTIONS:

1. This one may be a challenge. Describe Moe Stein using the Big Five Personality Dimensions. Arguably, Mr. Stein has been a business success. How do you explain this in terms of the dimensions? Does he possess a dimension that should be inconsistent with success?

2. Does Moe Stein experience job satisfaction? What do you believe contributes to this?

3. Does Moe Stein have emotional intelligence? What would Moe’s son say? Analyze Stein in terms of the four EI competencies. Does the fact that Frank’s Sport Shop is located in the Bronx matter?

4. Discounting son Ronald’s comment, does Mr. Stein experience job stress? If so, what kind?

SOURCE: S. Dolnick, “A Full Stock of Fishing Rods and One-Liners,” New York Times (Retrievable online at http://www.nytimes.com/2010/06/13/nyregion/13joint.html?_r=1)

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Rosetta Stone, maker of software by the same name, has grown from a small, family-run business into a publicly-traded company under the leadership of CEO Tom Adams. Adams is multi-lingual and credits his experience learning languages beginning at age 10 with taking the company to the next level.

QUESTIONS:

1. In terms of talent, discuss what makes Tom Adams an effective CEO for Rosetta Stone.

2. What is the impact of globalization on a company like Rosetta Stone?

3. Identify the advantages Rosetta Stone has over conventional language acquisition training.

4. On an individual level, how would using a product like Rosetta Stone help your career? In what way does acquiring a new language make you a portfolio worker?

SOURCE: C. Jones, “Rosetta Stone CEO Wants to Teach the World to Talk,” USA Today (Retrievable online at http://www.usatoday.com/money/companies/management/profile/2010-11-08-rosettaCEO08_CV_N.htm)

Related video clip:

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The United States imposes export controls on dual-use technology items. The term dual-use technology refers to items which can be used for both military and commercial applications. Dual-use technology is a concern for items which could be used for peaceful or for military purposes, such as building nuclear or biochemical weapons. The United States bars or heavily restricts the export of such dual-use technologies to any nation on its “entities” list; a list that includes countries such as Iran and China. President Obama traveled to India over the weekend to promote trade between the two countries. India would like to negotiate the removal of dual-use restrictions for its governmental agencies involved in defense, nuclear and space research. The United States sees India as a market for its aviation and defense industries.

QUESTIONS FOR DISCUSSION:

  1. One of the justifications used for preventing dual-use exports is national security. Critique the extent to which this is an appropriate argument for India.
  2. The article and the related videos seem to suggest that trade between India and the United States can be a quid pro quo or “this or for that” arrangement. Analyze the tradeoffs for the United States of easing export controls to India.
  3. President Obama faces increasing domestic scrutiny for the continued high levels of unemployment. Discuss how Mr. Obama’s trip to India will complicate his goal of proving that his economic policies have produced jobs back home.

SOURCE: Sharma, A. (2010, November 5). On the agenda: Easing tech limits, touting deals. Wall Street Journal, p. A5. (Retrievable online at
http://online.wsj.com/article/SB10001424052748704805204575594341708986102.html)

Related video clip available at: http://online.wsj.com/video/obama-boosts-indo-us-economic-ties/96DB801B-1B85-44FE-B9B2-0FD8BFC4A7FA.html

Related video clip available at: http://online.wsj.com/video/obama-india-sojourn/D5399722-04AE-4A50-9754-3B29CF2E3F29.html