ONLINE BOOK:
Strategic Management: Theory & Cases: An Integrated Approach
Author: Charles W. L. Hill
https://ereader.chegg.com/#/books/9781305856271/cfi/0!/4/2@100:0.00
Directions
Respond to Post 1 & 2 below
- Post #1
- Explain why you agree or disagree with their analysis.
- Words for this post 100 – 250
- Support your responses with credible references, where applicable.
____________________________________________________________________________________________
Question:
Under what conditions is it ethically defensible to outsource production to companies in the developing world that have much lower labor costs when such actions involve laying of long-term employees in the firm’s home country?
Answer:
In order for a company to survive, it has to do what is best for the company to survive and remain profitable at the same time. If a company decided it needed to outsource its production to a different country other than the company’s home country, this means that a strategy is being put to use to help the company thrive.
In order for it to be ethically done, the company should have a solid strategy to cut their costs by producing in a different country, yet still abiding by all laws in both the home country and the producing country. The company could also offer their long-term employees re-location options so they may not necessarily have to get laid off but can continue offering their expertise at the new location.
Although the last option might not work for all companies, they could find other ways to keep their loyal employees in certain roles that would continue to benefit the company. Now days many things are possible with technology so even employees who can commit to the new location only 30-50% of the year could still telecommute the remainder of the year.
This would be a great option for the employees, if the company is in a financial state to keep those employees on board. Ultimately, in order for a company to ethically outsource production to a developing world/country, they would need to do so with all local and federal laws applicable to them. This will help companies stay responsible for their actions and maintain their ethics. As far as the employees go, the company could offer them positions in the new location or offer severance packages to help make the transition easier.
Reference:
Hill, C.W., Schilling, M., & Jones, G.R. (2017). Strategic Management: An Integrated Approach. Australia: Cengage Learning.
Respond to Post #2 below
- Posts #2
- Explain why you agree or disagree with their analysis.
- Words for this post 100 – 250
- Support your responses with credible references, where applicable.
____________________________________________________________________________________________
Question:
Under what conditions is it ethically defensible to outsource production to companies in the developing world that have much lower labor costs when such actions involve laying of long-term employees in the firm’s home country?
Answer:
It has become common practice for businesses to outsource production in developing countries, however, I think it is naive to believe that these companies have more concern over the people than they do the profits. I say this because the risk is two-fold. On average most employees stay with a company for 2-5 years, while the companies can terminate them at any time. I think that it is ethically defensible to outsource production as long as you are doing it for profit and within the legal right to do so.
Reference:
Hill, C.W., Schilling, M., & Jones, G.R. (2017). Strategic Management: An Integrated Approach. Australia: Cengage Learning.