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Question CHAPTER 2:Business Ethics and Social Responsibility

Question CHAPTER 2:Business Ethics and Social Responsibility

Question

CHAPTER 2:Business Ethics and Social Responsibility

CHAPTER 4:Competing inWorld Markets

CHAPTER 6: Starting Your Own Business: The Entrepreneurship Alternative

CHAPTER 12: Product and Distribution Strategies

<pclass=”msonormal” style=”box-sizing: border-box;”>Chapter Video Cases

CHAPTER 2:Business Ethics and Social Responsibility

Video Case: J Timberland Walks the Walk

Video Running Time: 13:36

Organization Discussed: Timberland

Concepts Spotlighted in Video:

  • Business ethics
  • Social responsibility
  • Ethical standards.
  • Branding
  • Quality
  • Competition
  • Customer satisfaction
  • Collaboration
  • Innovation

You know people who talk the talk of volunteerism and service. But do they walk the walk as well? Timberland is an extraordinary example of an entire company based on walking the walk of social responsibility? in its own boots. The Stratham, New Hampshire-based company has been making high-quality, durable work boots for decades under the name of Timberland, and prior to that under the name of the Abington Shoe Co., which Timberland’s founder Nathan Swartz purchased in the 1950s. The firm is probably best known for its waterproof leather boots, but it has added new lines of footwear that include casual fashion shoes, boat shoes, and hiking boots, as well as clothing and outerwear. While continuing to build its reputation as a brand that stands for durability, ruggedness, and the American outdoors, Timberland has been constructing a reputation for integrity and commitment to the community as well.

Ken Freitas, Timberland’s vice president of social enterprise, loves to talk about the ways that his company has been able to build social responsibility right into its brand. “Doing good and doing well are not separate things,” he says. ”We’re a business? part of our profits get put back into the enterprise and community.”Timberland implements this commitment through a series of programs in which its employees ? including top managers? and corporate dollars participate. Through its Path of Service Program, employees receive up to 40 hours of paid time per year to participate in community service projects at local schools, day-care centers, the Society for the Prevention of Cruelty to Animals (SPCA), food banks, and the like. They might clean up a nearby beach or help build a park. Years ago, Timberland established its Service Sabbatical Program, in which three- to six-month sabbaticals are awarded to as many as four employees who wish to use their professional skills in assisting local nonprofit organizations full-time. Then there’s the Global Serv-A-Palooza, the annual worldwide, companywide celebration during which 2,000 employees, vendors, and community partners participate in a day of service.

Timberland’s organized approach to community service began in 1989 following a phone call from a new volunteer program called City Year, which was based in Boston. As part of City Year, graduating high school students from diverse backgrounds would take a year off before starting work or college to participate in community service. Because many of the volunteer jobs involved outdoor work, City Year asked Timberland to donate 5O pairs of its work boots to the cause. Timberland agreed, and the next year City Year requested 70 pairs. A relationship was born during which both City Year and Timberland have grown nationwide. To date, Timberland has invested more than $10 million in the program and now outfits every City Year volunteer in boots, pants, shirts, jackets, and rain gear. “Yes, Timberland is helping to build City Year,” notes Ken Freitas. “But City Year is helping to build Timberland.”

How does Timberland measure the success of its community service programs? “One of the key challenges in a social responsibility program is measurement,” admits Freitas. “How do you know if it is successful?” One way Timberland has been able to keep track of this is through joint marketing efforts with City Year. When a retailer in Philadelphia asked Timberland to make red boots to satisfy its younger customers (instead of the traditional tan work boots), Timberland balked at first. But then managers realized that red was the official color of City Year, and red boots might become the signature footwear of City Year volunteers. So Timberland made the boots and supplied them to the Philadelphia retailer as well as City Year participants, and all three organizations experienced growth in the Philadelphia area. This type of growth is reflected in Timberland’s revenues, which currently reach more than $1 billion each year. But Freitas cautions against overdoing measurement. “What brings people to a brand isn’t necessarily measurable,” he explains. So Timberland adopts a “management and magic” philosophy that incorporates tangible results while leaving room for the unexpected or unexplainable.

At Timberland, social responsibility starts at the top. “Our company has a strong set of values that form the resolve for all that we do in the community? humanity, humility, integrity, and excellence,” writes Jeff Swartz, president and CEO. “We strive to lead as responsible corporate citizens and to invest our resources, skills, ingenuity, and dedication to create positive change.” If you happen to attend a Timberland national sales meeting, you’d better leave your golf clubs and swimsuit at home and wear your work boots instead. You might spend the day building a playground.

Chapter 2 Video Case Questions for Critical Thinking

  1. In what ways does Timberland fulfill its responsibilities to consumers, employees, investors, and society as a whole?
  2. In addition to a climate of social responsibility, do you think Timberland is likely to foster a climate of ethical awareness throughout its organization? Explain your answer.
  3. In what ways does Timberland’s Path of Service Program help develop the quality of its workforce?
  4. Think of a small or large company in your hometown or in the town where you go to school. In what ways does the company serve its community? If it does not, describe ways in which it could.

Experiential Exercise

Our approach to building and sustaining strong communities includes three primary strategies: civic engagement, environmental stewardship and global human rights.What is Timberland doing in each of these areas?

Go to Timberland’s websitehttp://www.timberland.com/corp/index.jsp?page=csroverview

What is Timberland doing about climate change? How does the company approach resource consumption? How is Timberlandimproving the quality of life for approximately 175,000 workers in 290+ factories in 35 countries? What more could Timberland do to be socially responsible?

CHAPTER 4:Competing inWorld Markets

Video Case: ESPN Broadcasts Sports around the World

Video Running Time: 14:33

Organization Discussed: ESPN

Concepts Spotlighted in Video:

  • Branding
  • Global Expansion
  • Target Marketing
  • Advertising
  • Quality
  • Partnerships

Video Case Synopsis

Blll Rasmussen made a big mistake in 1979. He had decided to launch a Connecticut-based cable TV station to broadcast local sports. So he and his partners leased a building and bought some satellite time. After they signed the agreement, they discovered that their satellite coverage was national, not local? and the idea for a regional cable sports station began to grow. New England, they thought, would be the perfect sports market for the new Entertainment and Sports Programming Network. Later, when business really got rolling, Rasmussen and his partners shortened the name to ESPN?and it stuck.

ESPN long ago leaped its New England borders into national coverage and ultimately extended its reach to covering sports and broadcasting them globally, although the company’s headquarters remained in Bristol, Connecticut, where the original building was leased and where they still operate today. Headquarters now includes several buildings, 28 satellite dishes, and 3,200 employees. ESPN operates 6 networks in the U.S. and 25 international networks, reaching between 150 and 155 million households globally. The company also produces ESPN Radio, ESPN Wireless, several Web sites including ESPN.com and ESPNSoccernet.com, magazines, and books, and it is exploring emerging technologies like video on demand and interactive TV. Spanish-speaking viewers can watch ESPN Deportes 24 hours a day. ESPN fans can eat at the ESPN Zone restaurant and buy merchandise at [email protected] Collectively, the ESPN media outlets offer coverage of local sporting events as well as major tournaments like the PGA Championship and the British Open for golf and the America’s Cup sailing races? not to mention games of the NFL, NHL, MLB, WNBA, and various college sports. In addition to the game coverage, it offers sports news and analysis; information on scores, statistics, standings, and schedules; and just about any other sports-related content the enthusiast could want.

Reaching out for the global market was something that ESPN founders did “on gut feeling,” says Willy Burkhardt, managing director of ESPN International. Because cable television was still new when ESPN was born, not much data existed on who was watching what around the world. But ESPNs executives had the idea that sports, like music and major news stories, had universal appeal. So they decided to try broadcasting American sports events in South America. Today, South and Central America? particularly Argentina, Brazil, and Mexico?represent 40 percent of ESPN’ s total business. And although the firm continues to broadcast American sports overseas, it now places much greater emphasis on local and regional programming based on the tastes and preferences of the host cultures. For example, says Burkhardt, in India “cricket is a total culture.” While few Americans are familiar with the sport, millions of Indians are glued to the TV for cricket matches. In Argentina, rugby and polo occupy prime-time coverage. Major markets such as Argentina and India command their own ESPN offices and on-air announcing teams. In addition to South America and Asia, ESPN has a presence in Europe, Canada, Australia, and New Zealand?and even a station in Antarctica.

ESPN has used a variety of methods to enter international markets. In Europe, ESPN has had a longstanding partnership with EuroSport, which means that, although many European consumers watch sports on cable television, they are not necessarily aware of the ESPN name. However, recently ESPN did launch ESPN Classic Sport, a network dedicated to the greatest moments of European sporting history. ESPN operates in Canada through partnerships, as well. These arrangements are partly due to varying regulations in different countries and regions. But in Asia, ESPN has a large operation of its own, broadcasting to about 25 countries on the continent, including India, which is one of the firm’s most important markets.

ESPN continues to grow in international markets because its managers believe they can bring “a new century of sport” to viewers around the world. “You learn by doing,” says Burkhardt. ESPN wants viewers worldwide to watch what it is doing.

Questions for Critical Thinking

  1. Describe three barriers to ESPN as it expands in the global marketplace.
  2. How might NAFTA and the European Union affect ESPN in those areas?
  3. Describe the levels of involvement ESPN uses in its different international markets.
  4. Does ESPN adopt a global business strategy or a multidomestic business strategy? Explain your answer.

Experiential Exercise

ESPN International Mobile distributes content via WAP, SMS, video, data applications, games, wallpapers and ringtones with product distributed around the globe in eight languages, on over 35 carriers to more than 1000 handsets. Included is video distribution of major American sports in Europe, Canada, the Middle East, Southeast Asia, Latin America and Australia, as well as the best from our Latin American regional networks in Spanish on ESPN Movil. Our X Games Mobile service includes video-with more than 100 X Games clips of medal runs, interviews and more.

How does ESPN International Mobil help ESPN develop its brand name?http://international.espn.com/

CHAPTER 6: Starting Your Own Business: The Entrepreneurship Alternative

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