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3.3 THE INTERNATIONAL BUSINESS ENVIRONMENT 148 North American Free Trade
3.4 THE ECONOMIC ENVIRONMENT 150 Agreement (NAFTA) 163
Economic development 150 Association of South East
Infrastructure 150 Asian Nations (ASEAN) 163
Economic interdependence 151 STUDY TOOLS 165
Resource and product markets 152 Online study resources 165
Exchange rates 152 CourseMate Express for Management 165
Inflation, interest rates Search Me! Management 165
and economic growth 152 Response to the management challenge 165
3.5 THE LEGAL- POLITICAL ENVIRONMENT 153 Achieving international competitiveness 165
Political risk 154 Discussion questions 166
Political instability 154 Ethical challenge 166
Laws and regulations 155 Quality or closing 166
Group challenge 167
3.6 THE SOCIOCULTURAL ENVIRONMENT 156 Considerations for overseas expansion 167
Social values 156 Case for critical analysis 167
Communication differences 159 Shui Fabrics 167
3.7 INTERNATIONAL TRADE ALLIANCES 160 On the job video case 168
GATT and the World Trade Organization 161 Black diamond equipment: Managing in a
European Union 161 global environment 168
CONTENTS
PART THREE PLANNING
CONTENTS
8.3 COOPERATION 392 Response to the management challenge 413
Innovation roles 396 Reinventing Samsung 413
8.4 CHANGING PEOPLE AND CULTURE 399 Discussion questions 414
Ethical challenge 415
Training and development 401
Crowdsourcing 415
Organisation development 401
Group challenge 416
8.5 IMPLEMENTING CHANGE 405 Are you ready to implement personal change? 416
Creating a sense of urgency 406 Case for critical analysis 417
Resistance to change 407 Malard Manufacturing Company 417
Use implementation tactics 408 On the job video case 417
Honest Tea: Managing change and innovation 417
STUDY TOOLS 413
Online study resources 413 CHAPTER CASE STUDIES
CourseMate Express for Management 413
386
Building a better mouse .
Search Me! Management 413
General Electric 400
A mini crisis of culture and performance 410
CONTENTS
12.3 ORGANISATIONAL AND WORKPLACE COMMUNICATION - -570 Ethical challenge 587
Social media 571 The voice of authority 587
Personal communication channels 572 Group challenge 587
Formal communication channels 576 Listen like a professional 587
Crisis communication 580 Case for critical analysis 588
WA Manufacturing 588
STUDY TOOLS 585 On the job video case 589
Online study resources 585 lntermountain Healthcare: Managing communication 589
CourseMate Express for Management 585
Search Me! Management 585 CHAPTER CASE STUDIES
Response to the management challenge 585 Genera/ Electric 564
John Mcfarlane: communicate to build morale 585 Susan Williams 579
Discussion questions 586
Glossary 701
Name index 711
Subject index 716
CONTENTS
Guide to the text
As you read this text you will find a number of features in every chapter to
enhance your study of management and help you understand how the theory
is applied in the real world.
-
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CHAPTER-OPENING FEATURES
I 'i 1% il:Piil\i Af
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TO EXTERNAL FORCES --·-.:::""· ---0- Identify the key concepts that the chapter will cover
.:::2:;:~ =---~:-: with the Learning objectives at the start of each
chapter.
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The Management challenge at the start of each
chapter presents a real- life management scenario that
relates to key chapter concepts, and encourages you to
think about how best to resolve it.
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xv
FEATURES WITHIN CHAPTERS
REMEMBER THIS
• M•n•gement !1 • dynam;c fleld. elweysch•nging in tome w1ys, ye11here ••• M>me concepts and
ted>niqU&S thatll..,e•roodth1 testof1Jme.
t There ~• )QI that can be l,,erned from whe t h "" e nd ha.""' wo,ke d in managing orge rn..ation.. in lhB
past, to inlormm• ""genelatrategi..,gomgforw1rd.
ICONS
a riew aprroach OC'gms with a shift to dec•ntral!Md pi.nmne, wh,ch meaos th.:tt pL:mn,og Cl,:perts WOO
thL~r - eno .. JlNd
\\1th managers in major d11"is,ons or dq1,1nmcnts to dt.'\'i'lop own go.115 and p lans as is mdicatt>d in
UIHIIIT 1.a. /1.!anagcr.; throughout the company come up Mth their mm crNUw soluhons to problems
and become rnoR'romm,u!.'d 10 following through on th,, pbns. As 1h,, cn,ironmenl becomes 1-"1'-'fl more
~·-·-
ploM!t19
plo'lnr,ge.pen,ID~
"""'"""'""""V<'""'"-
1"olat1le, 1opexecutn-...sseetheb.."'1ldiisofpushingdecemralb;edpl.,nnini;"'"nfurthcr byh.a1"ingp!am1ing
experts work d,R'ctly "1th line managers a!ld front-line c,nployces to dcwlop dynamic pLms that meet
fast-changingn<'Cds,.
ln a complex and CO!np,.'titiw business l'IWironml!fll, s!Tategit thinking and exc.."tJtion be.:ome the
expectatlOllof l-"l-,,,Yl'lnplo)l'-'<'." rlanniogroines a.h,'i'whl'lll'lnployt-"-"'aremvolved,n..,tunggoals aod
detenntning the means tn R'a,h th,,m. Thr following J;eC!i,">11'; pl'Olide sotnc guiJelines for lll!lO\'J.tiW
planmng.
and global conte xt from the Only about a quarter of sales come from outside the United morethantheeightmajorstoresit hadln2016,duetothe
States.butstoresalesinoverseumarkets-includ1ng greatsuccessilhuachievedinMelbourneandSydney.
Innovative way boxes. Australia - have been growing about four times faster
than those in the United State'!. Ccxko plans toe~pand Its
Costco has entered the petrol ,et.ailing market in AudraJia In
lh1eestales.
Soutea:Edebo11.S.l)OJ•...,•'1'2011l. Cco1COl(eepsfa!ffll.Jl• u hE"P1ndo.l'ltl"""'•1-1tt1rOoily.19,1;°'"'!1,A. !lA,p,112010~CoolCOC--
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INNOVATIVE WAY
Twitter and square Ch 01, p. 6 Procter & Ga mble Ch 08, p. 396
Budget blockbusters Ch 01, p. 16 General Electric's work out Ch 08, p. 404
Clickcorp: Taking Ugg to the world Ch 01, p. 35 Staying in the picture: Ted's cameras Ch 08, p. 406
Shopping online, even for cars Ch 02, p. 95 ENSR Ch 08, p. 409
Costco's winning formula Ch 02, p. 100 Ang lo American pie. Ch 09, p. 424
Zappos family Ch 02, p. 111 Taj Mahal Palace, Mumbai Ch 09, p. 442
Hollywood studios Ch 03, p. 146 Level 5 leadership at work Ch 10, p. 470
Gap Inc Ch 04, p. 189 Charismatic leadership Ch 10, p. 488
Cultivating a service mindset Ch 04, p. 199 Flexible work policies Ch 11, p. 520
Goog le Ch 04, p. 200 Prudential UK and Europe Ch 11, p. 540
Planning for a bigger Toll Ch 05, p. 240 Virtual brainstorming Ch 12, p. 562
Jetblue Ch 05, p. 246 Cisco systems Ch 12, p. 567
The birth of the Kindle Ch 05, p. 248 Amgen Inc. Ch 12, p. 568
Amazon Prime Ch 06, p. 266 Tupperware Nordic Ch 12, p. 572
Dell Technologies Ch 06, p. 271 Spring company Ch 13, p. 603
Facebook Ch 06, p. 274 McDevitt Street Bevis Ch 13, p. 619
Focused innovation in marketing Ch 06, p. 285 7-Eleven Ch 14, p. 649
The Dodo is not extinct ! Ch 06, p. 290 Campbell soup Ch 14, p. 654
Caterpillar Ch 07, p. 340 The global success of eBay Ch 14, p. 662
Teams work at Imagina tion ltd. Ch 07, p. 357 GE people/ talent management Capstone Ch, p. 685
Flight coordination Ch 07, p. 366
GUIDE TD TH E TE XT xvii
CASE STUDIES
Growing a business From scratch: lavender! Ch 02, p. 99
Green power Ch 02, p. 112 Obtain an understanding
McDonald's Ch02~
of how leading practitioners
The axis of India Ch 03, p. 138
A leadership dilemma at Tim berland Ch 04, p. 194 are applying management
A crisis to milk Ch 04, p. 202 theory from the real-world
Planning and implementing the infrastructure of the
Ch 05, p. 233 examples in the Case study
Future
Siemens Ch 05, p. 235
boxes.
MYDB Ch 06, p. 265
Apple lnc.'s strategy: much more than iPod, iPhone, iPad
Ch 06, p. 267
and Mac
Strida Bicycles: a globally networked company Ch 07, p. 361
Bu ilding a better mouse . Ch 08, p. 386 CASE STUDY
General Electric Ch 08, p. 400 ~
A mini crisis of cu lture and performance Ch 08, p. 410 R1y Kroc, founder of Mt0o~·s. once s11d. ·1 dorn lmow
what we·1 be serving In the ye:u 2000. but we·n be ser,n1,1
divided the United St:Un Into temtorle'I. cre1Ung smal~
comp.anle!. to reapture some of MCDorukrs entrep1eneurbl
more o f It than mybody'. Fmm Its founding through to trn, 1e2l. We ve not afraid to do thing, ditft'fffltly.' Grttflbng
Container Store Ch 09, p. 435 ~ 1980S, Mdlonul's dunged with consumer,' 1.:1:stes Uld. Mm:tgers began to ~gnkc that, rven !h<)Ugh
~ n g to~ ti< what we w:inted befo,e we ,:vcn k = McDon;>Jd', w.:,,; stlll thc world's most wccasfl.l rest..urmt
VIVO Ca fe: all in the family ... the business is people Ch 09, p. 448 we wanted !L Today, however. Kroc's bold cblm does not comp.liny. It was far from achieving ltspolentlal. They were
seem so :mured. Although Mo:Donild's s~~ h:is 1 m2jority trying to retum MtDon~·s to the healthy. adaptive culture
Biotechnology companies in turbulent environments and share of th<- US fffl·food mvket md continues lo exp21ld of the earfy y,,=. when It w:os rnmbntly in touch with the
Ch 09, p. 453 lnk'm:!tlon:111)',thccompanytsslppingf.:a,t lnlts obiltyto
challenging times recognlSf ond slul'(' pop,Jlor tttnd<
Sorneanalysu:ind ln'll'S~belevethewklespreod
By the late 2000., Md)onald's hod mode m:my changes,
wosoperatlngmoreeffldently ondsusulnoblyondoffeilng
problemsw;thMcDonold's:ueduetothecomp:iny'sinsubr newproductssuchasWdsondcafo!p(odUCU. ltlnc~ased
News Corporation Ch 10, p. 479 arrogant cUltUfC. The •~roge top e,cecuttve al MCOonokh ulcl XJCM Its 35000 ~ . ol)vloo.ly giving It< 60 millon
startcdworklng attherornp:mywhrnRkh:ird Nm>nwas <1Jrtorne,,;perdayanexl)Cflcnceth.attheyvaJue,whtJ,,.:ilso
Managing motivation at Degussa Peroxide Ltd Ch 11, p. 510 l'fesjdentoltheUnltedStates,andthecompanyhasb«n WICfeaW!gth<:<ompmys1toc:k?OCebyaf:tcto,of thrtt
reluct:mttobrlnglnoulsidelea6erstoguide=n•gementas OYCfth<:flveycarsto2007.Growthlneme!'gingeconomles
Nintendo Wii U: coping with fi erce competition in the the e~te=I environment ch:utges. kid ttle ~rd is =de has beffl very soHd M<:Don:Jd's has more rett!ltly
Ch 11, p. 517 upof~-knitlnslde"whah.av.,donellttletoaglbkl0< rf'lurl>ishedft> st0<es andrNC\lgncdlt.product, lnlcadlng
world's video game market change . "' perlormance d«HnNI. top leaders ten<led to m2fltets such:,,; Austr.:ilia.. now makOlg =ny product. to
blamrtothets,1ucha1 dl1sklentfranch""°' · ~ws"'porters thcsptdflc0<de"oflt1cu,tome".lly2014,Mc0orwd's
Outback Steakhouse Ch 11, p. 523 and Wall Strttt analysts. 'If the~ we~ one thing I would
change about McDonald's,' ~id stnlor vke·pl'COOent Brod
h.ld subst-anlWjy w:ompllshcd this product and process
u p ~ through rolling It out on an h1temallonol basis, N,
A. BaJJ. 'it would be to correct the m1,amceptK>OI and of 2016. McDonald's has engaged Tn signil!cant lnnovatlons,
General Electric Ch 12, p. 564 rnisperceptlon,th:>1.hove~sopetv~lvt,fnthela5l frorn·c,eateVourTaste'tobble "1vlu-option,2rnla
few yem: range of new "'tvkes and lnitlatl11es McO.fe's, which are an
Susan Williams Ch 12, p. 579 lnthcl:lle1990s, McDon:lld's emb.ukedonaneffortto Ausb"aUanlnnovatlonlor,V,c:Donald's,h.avebttn rolledout
~ form. ~~ement was reorganMd. and tile then·hcad of Olte=tiorlally These new 5CJVlces have led to slgnlfk:tnl
The team's the thing Ch 13, p. 596 th<:USdornesticdlvlslon.JadM. Grttnberg, brought!nol
le2'!. a h>ndfut of new m>.n>.ger1. Including e•«utlvn from
sales growth. andh1vc.,...enbrooghtnewcustomfflto
rnnS1Jme from Ml:Dorwd's
eu,gerKh1g, Boston/iiwketandGener.:ilE!m:rlt..He.:il~
The Aconex team in Melbourne Ch 13, p. 604 Foodl,,,ll,oUS......-.--.---....-
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xviii GUID E TD TH E TE XT
AUSTRALIAN MANAGER
PROFILES
..
f"=========fM
MAMNAGEMENT IN PRAc:1r1iccE1========~
UNLOCKING INNOVATIVE SOLUTIONS THROUGH PEOPLE - IT IS POWER
(A.ND RESPONSIBILITY) TO THE PEOPLE
Analyse practical applications Feeling aU too burder,ed by responsibility, 24-year·old Ricardo they w,11 work on, based on how they think they can best make a
which highlight specific aspects of the company was manufacturing equipment for a Brazman
shipbuilding industry thai Wa$ in abysmal shape. A$ Semeo's
evalua1e superviso,s, and have ma,Or Input ir,to how they are
compensated, with some actually $Siting their own pay r.nes. AU
prasidant and majority owner, Semler fired most ol lhe top financial information, inctud,ng salari11S, ls available to everyone,
management and offer in-depth, management and used a seri111 of strategic acquisitions to
steer the company into more viable markets . Ironically, as lhe
and i,rry employee is allglbte to i,ttend i,ny meeting, including
board meetings, where two seats are reserved for employees on
practical advice about how to company's fortunes began lo revive, Semler's own heallh took
a nosedive.
a first-come, flrst-serYOO basis.
The result of 11pplying these rather radical cultural
As ha lay in a hospital bed, Semler had a vision lor a new values i1 that Semco has not only survived but prosparad
address them in a work context. way 10 manage - by rallnqulshing control to his employee,.
Thus began a ftva.year ptocess of building I radlca!ly democratic
In Bruil'a often chaotic economic and political climate. The
conglomerate now produces 111 diverse range of products and
culture based on open lriforma!ion and emplc,yoo partlcipa1ion. services, from manufacturing giant oil pumps to participating
Semler started modestly - lettmg employees diOOS<l their uniform in mall processing Joint ventures. Its revenues grew from
colour, for uample - end even1ually moved to the creation of USS4 million In 1982 to approxlmataly US$240 million
egalitarian project learns that had complete responsibility for recently.
particular projects, total authonty regard,ng how to perform the m, 'It's about competitive advantage; Samle r says. 'Once you stop
and the opportunity for team members to pod(et a substantial !rying to control employees.' he insisu;, ·you raleasa the pow&rrut
perm:,mage of any profll.ll gener.ned. Today, 5$ll~irected teama twin forces ol S(ll!~Jsclpline and peer pressure. Performanc.e
form the basi1 of the company's loose, fieKibte oiganisation becomes the only criterion for success: Al Samco, ireatlng
structure. Paople typically have a chanl!III to choose what projects employea1 li1te responsible llduhs ts Just good bualn&&a. With this
'. .
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GUIDE TD TH E TE XT xix
END-OF-CHAPTER FEATURES
Sustainable develoJJment
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DJICU5SIO'IQUUTION$
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In their progress through the country on anti-slavery missions, the
agents of the Massachusetts Society never failed, from the
beginning, to learn how hard it is to be reproached for a righteous
man’s name’s sake. To appreciate the force of their temptation, let
the beholder, for a moment, place himself in their situation. It is in the
power of the minister in almost every parish, to procure them a
hearing,—but he is in combination with his brethren to “put down
Garrison.” Is it wonderful that, instead of silencing the bigot or the
slanderer with the assertion “he is a good man and a faithful
abolitionist, and his opinions on other subjects are no more our
business than your own,” they should have striven to repel their
assailants by endeavoring to draw a line of distinction between him
and themselves? Parallel to this was the course of Peter; unrepented
of, it deepens into the darker dye that marks a Judas.
When men who sought a pretence to avoid the consideration of the
cause, were told that the Massachusetts Board of Managers differed
as widely as themselves from Mr. Garrison’s opinions on other
subjects, their intolerance forbade them to credit the statement. If the
Agents ventured to cast freely off, in the name of the Society, all
responsibility for Mr. Garrison’s individual opinions, and to vindicate
the rectitude and energy of his abolition course from the beginning,
they were obliged to endure the reproach of being “tools of
Garrison,” and singing his praises, when they should rather be
employed in removing such a stumbling-block out of the path of
“good men.” A truly noble soul, thus spurred up to the encounter,
would have exclaimed in the spirit of Bürger:—
FOOTNOTES:
[2] “Of Mr. Garrison I will say, as the Pope said of his minion, I will
absolve him of all the sins he ever has committed, or ever will
commit.”—Speech of Mr. St. Clair in 1837.
[3] A scheme so called, for benefiting the colored race, without giving
offence by the mention of Freedom, or Human Rights.
CHAPTER IV.
THE WARNING.
Time, which waits for no man, but keeps on, with even foot-fall,
whether witness of right or wrong, frankness and openness, or
chicanery and intrigue, brought round the year 1839.
Mr. Torrey, who had represented his county as crying out for a new
paper, till possibly the echo of his own voice might have led him to
think his testimony true, now found a feeling waking up in Old Essex
that he had not anticipated. The women there, with whom, in the
spirit of a true mussulman, he had, a few months previous,
considered it defilement to sit in Convention, had always been most
effectual helpers of the financial department of the cause. Some of
them had been among the earliest laborers; and, experienced in
observing the pertinacity with which the enemy, from the beginning,
had striven to possess himself of the fortress, by striking down the
warder of the gate, were startled by Mr. Torrey’s great zeal for a new
paper. They compared it with his hatred of the Liberator, so manifest
during the clerical appeal controversy, and took note, from time to
time, of the manner in which he argued this new necessity.
They found that, like the Colonization Society, the necessity had two
faces; one for the real and the other for the pretended abolitionist.
They saw that this “necessity” was founded on prejudice against the
Liberator, as the Colonization Society rests upon prejudice against
the free man of color.
The plan was, to carry the State by counties and by towns, and then
to crowd up to the grand annual meeting in irresistible strength, to
give the finishing blow.
The next meeting of consequence was that of the Worcester County
Society, (north division,) at Fitchburg. There, Mr. St. Clair introduced
the new ideas, by means of the projected resolutions. At the close of
the meeting, after most of the friends had retired, and against the
wishes of some who remained, he persisted in presenting them.
They were adopted, after speeches from himself and the Rev. Mr.
Colver, by the raising of five or six hands; probably without a
perception of their design and tendency on the part of that few.
FITCHBURG RESOLUTIONS.
Whereas, slavery is the creature of legislation, upheld and
supported by law, and is to be abolished by law, and by law
only; and
Whereas, in order to secure its legal overthrow, the legislative
bodies having power over the same must be composed of good
men and true, who will go for its immediate abolition; and
Whereas, it is impossible to obtain such a legislative body,
unless abolitionists carry their principles to the ballot-box, and
vote only for men of this character; and
Whereas, it is impossible to urge this duty on the consideration
of abolitionists without an able paper, which will take this ground
and maintain it consistently, firmly and constantly: Therefore,
Resolved, 1st, That, in the opinion of this Society, every
abolitionist is in duty bound, not to content himself with merely
refusing to vote for any man who is opposed to the
emancipation of the slave, BUT TO GO TO THE POLLS, AND THROW HIS
VOTE FOR SOME MAN KNOWN TO FAVOR IT.
Happily for the slave, at this critical instant, there were not wanting
men to call out “Treason!” against this whole procedure, irrespective
of its probable success, in that soul-cleaving and victorious voice
which carries with it instant conviction.
It is interesting to observe the course of men in peculiar and trying
times, and to notice the strong contrasts of character and conduct
that such times present.
Mr. Phelps, Mr. Stanton, Mr. Torrey, and Mr. St. Clair were hurrying
from meeting to meeting with the Fitchburg resolutions, or driving the
quill over quires of paper, urging the instant convocation of the
societies for the introduction of the new paper, saying that it was not
intended to be in opposition to the old, but only introduced because
nine out of ten of the abolitionists in the State would not take the
Liberator,—that it would probably be adopted with great unanimity as
the organ of the State Society, at the Annual Meeting—and dwelling
strongly on the importance of sending up large delegations,
instructed to vote in its favor.
Mr. Garrison stood calmly watching the aspect of the times, and
when the signs were full, he raised the note of warning—
Wendell Phillips, the same who took the brunt of the battle at Faneuil
Hall, upon the day when men met there to wash their hands of
Lovejoy’s murder, was among the foremost to detect the subtler form
of danger. His letter to the financial committee of the Liberator, which
appeared in the next column to the call of the watchman, stripped
the opposition of their disguises, with a firm and dexterous hand. It
exhibits, in a condensed form, the mind of one who had knowledge
of the cause throughout the State, as a lecturer and a manager of
the Society, and throughout the land, as an acute and philosophical
observer. In politics, a voter,—in theology, a Calvinist,—in church
government, a congregationalist,—looking on these things from the
same point of view with those who were laboring for the destruction
of Freedom, toleration and fraternal confidence in the cause, he
came to diametrically opposite conclusions.—