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Fundamentals of Human Resource Management 6th Edition by Raymond Noe, John Hollenbeck, Barry Gerhart,Patrick Wright
Edition 6ISBN: 978-0077718367Fundamentals of Human Resource Management 6th Edition by Raymond Noe, John Hollenbeck, Barry Gerhart,Patrick Wright
Edition 6ISBN: 978-0077718367 Exercise 6
CAN OFFSHORING BE DONE MORE ETHICALLY
As we saw in Chapter 5, human resource planning involves several options to meet an organization's needs for talent. One option is to outsource activities that can be performed more effectively and efficiently by a contractor. In today's global marketplace, outsourcing decisions frequently involve offshoring activities to companies in lower-wage locations. However, the reasons why labor costs are lower in another country include lower standards for working conditions-even conditions that would be considered unethical in the parent country.
This kind of decision can open up a company to criticism and may conflict with its own values related to social responsibility-a set of problems that Nike has been wrestling with for two decades. When the company was founded, in 1964, the idea of importing shoes from low-wage countries was an innovation. By the 1990s, reports of working conditions put Nike on the defensive, and it argued that it didn't own the factories, so it wasn't responsible. However, as negative publicity mounted, Nike began to share information openly and engage directly with factories to improve working conditions. In 2004, the company appointed Hannah Jones, a former reporter, to serve as its head of sustainable business.
Jones was especially concerned about working conditions in Bangladesh, but managers in the production division were drawn to the opportunity to buy shoes made at the lowest available cost. They believed that if they negotiated safety standards as part of their contracts, the suppliers would comply, but Jones had her doubts. To gather information and reach an agreement, Jones and the production managers visited one of the company's suppliers in Bangladesh. They saw safety hazards throughout the building and decided to stop buying from that supplier, even though the decision contributed to shrinking profit margins.
At Nike, decisions such as these have mostly eliminated purchases from suppliers that use certain hazardous materials and where workers have died. Still, organizations that investigate working conditions have found abuse of workers and violations of overtime and minimum-wage requirements at companies that sell to Nike. The company continues to set and monitor social responsibility goals such as buying from companies that have eliminated excessive overtime and that protect worker health and safety.
What ethical standards for human resource management do you think a company should require from all its operations worldwide In what areas of HRM, if any, should ethical standards be relaxed to match the prevailing norms of a particular country
As we saw in Chapter 5, human resource planning involves several options to meet an organization's needs for talent. One option is to outsource activities that can be performed more effectively and efficiently by a contractor. In today's global marketplace, outsourcing decisions frequently involve offshoring activities to companies in lower-wage locations. However, the reasons why labor costs are lower in another country include lower standards for working conditions-even conditions that would be considered unethical in the parent country.
This kind of decision can open up a company to criticism and may conflict with its own values related to social responsibility-a set of problems that Nike has been wrestling with for two decades. When the company was founded, in 1964, the idea of importing shoes from low-wage countries was an innovation. By the 1990s, reports of working conditions put Nike on the defensive, and it argued that it didn't own the factories, so it wasn't responsible. However, as negative publicity mounted, Nike began to share information openly and engage directly with factories to improve working conditions. In 2004, the company appointed Hannah Jones, a former reporter, to serve as its head of sustainable business.
Jones was especially concerned about working conditions in Bangladesh, but managers in the production division were drawn to the opportunity to buy shoes made at the lowest available cost. They believed that if they negotiated safety standards as part of their contracts, the suppliers would comply, but Jones had her doubts. To gather information and reach an agreement, Jones and the production managers visited one of the company's suppliers in Bangladesh. They saw safety hazards throughout the building and decided to stop buying from that supplier, even though the decision contributed to shrinking profit margins.
At Nike, decisions such as these have mostly eliminated purchases from suppliers that use certain hazardous materials and where workers have died. Still, organizations that investigate working conditions have found abuse of workers and violations of overtime and minimum-wage requirements at companies that sell to Nike. The company continues to set and monitor social responsibility goals such as buying from companies that have eliminated excessive overtime and that protect worker health and safety.
What ethical standards for human resource management do you think a company should require from all its operations worldwide In what areas of HRM, if any, should ethical standards be relaxed to match the prevailing norms of a particular country
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Fundamentals of Human Resource Management 6th Edition by Raymond Noe, John Hollenbeck, Barry Gerhart,Patrick Wright
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