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ADM1301B society week 1.docx

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David Delcorde

Business & Society ADM1301B Intro [terrible AC/DC video.] bands are businesses. revenues, expenses, marketing, promo, planning, org, etc bands have gov't connection : taxes, employ taxes, respect laws, need passports/visas to travel bands have affect on civil society: affects people, business,entertains ppl, offends people/stakeholders, which provokes pressure on gov't, indirect employ health professionals (at concerts) bands do not live and work in a vacuums. business do not exist on their own, they affect directly & indirectly other stakeholders. The banana (marketing video: feeding new york... about bananas) what happens when another competitor comes into the market and offers cheaper (lower quality) bananas? demand for the more expensive bananas falls. reaction? can drop their price? catch: requires money to wait it out. Company waits it out and then continues to prosper. then decides to give back. Do they need to give back? is the company property of the shareholders or is it the property of the society in which it exists? they decide to give back to society: charitable donations etc. reaction: perception of the company increases and they can charge even more! some companies will only invest in good, ethical companies. Then the gov't turns around and realizes they can tax them. So banana company needs a way to influence the gov't, they go to a lobby company. the lobbyiest is there to help you get ready to sit with the minister (they don't go to the minister themselves) gov't reaction: no change to tax laws. (The gov't is not interested in one company they are interested in sectors) suggestion: go global. so they become a publicly held corporation to oversee governance and went global. reaction: competition rises. not just an individual but the competition can now come from anywhere in the world. you need to be ready and have an action plan when this happens. Things go viral and spiral into something massive very quickly today. Nasty tactics: publicly accusing of child labor, illegal fertilizer, GMO bananas, stem cell research to increase crop yields etc - all fabricated stuff reaction: DBBI lobbies the gov't to raise these unethical tactics at WTO in the meantime the stakeholdres (any party or person with a perceived stake in the company - shareholders, suppliers, gov't in the area in which it works etc) want to know if they are true. DBBI wants to know who their key stakeholders are and how much power and interest they have? how powerful are they and how interested are they? do they truly understand their stakes? Which ones do we treat since we can't treat them all. How much do we have to do to create the perception of an ethical business, in the end, how can we be more effective. you need to be culturally aware/sensitive, you need to implent effect corporate governance. moral: business exists to satisfy the wants and needs of society. If society doesn't want a product, it wouldn't be made. when you move into globalization - many of the things we wouln't be able to afford if they weren't made offshore. the consequences of any business activity are good and bad. the objective is to minimize the bad but there are give and takes. there are always consequences. are the people who make our clothes better off because the stuff we wear is produced there? we don't know. Business needs to be profitable and you need to do so socially and ethically. Lecture 1 – Significance of business in its Social Context Issues - Society’s expectation of business driven by a more informed, affluent and litigious society - Technology advances facilitates misinformation and disinformation but also puts business in society’s spotlight- it is not about finidng info, it's about sifting through it and finding out what is real/relevant. - Who in “society” has the greatest influence? is it the gov't? business? civil society? the gov't can fix things but only using your money. will the gov't fix it? sure, if you want it, but if we let the gov't fix things there is less money for something else. that is the reality of the gov't - Who has the right to dictate how business should operate? is it the gov't? competiton? citizens? stakeholders? - What exactly is “ethical behavior”? an ethical dilemma can exist between two mutually acceptable actions, but you cannot do both. what is ethical behavior in this company may not be considered ethical in another. ie bribes: illegal in this company (and therefore not legal) but in other countires it isn't called bribes (convienience payments) and that cost can be deducted from your tax. Is it wrong? If one company does not do bribes, they will not be able to do business in countries where they do. - What exactly is “social responsibility”? we cannot all agree to this defn or how much is the right amount of social responsibility Significance of Business in its Social Context domestic macroenvironement - Business affects, and is affected by the society in which it operates - For managers to operate effectively, an understanding of business’ domestic microenvironment is essential What exactly is business’ Macroenvironment? - It is intuitive that business can affect, and be affected by other businesses - But business can affect, also be affected by o Government o Civil Society o o o The Modified Boulding Triangle: A way to depict the Canadian Macroenvironment The Business Segment - All forms of “for profit” business ownership – not crown corporations or anything that isn't in it for the momey - NGO etc o Corporations o Partnerships o Proprietorships The Government Segment - All levels of gov’t o Federal - focus o Provincial o Municipal The Civil Society Segment - Organized and unorganized social networks o Communities o Non-gov’t orgs o Charities o o Volunteers o Philanthropic efforts Canada’s Macroenvironment – the business-gov’t-Society Nexus 2 - The modified “boulding triangle” depects the three segments of the domestic macroenvironment – business (B), Gov’t (G) and Civil society (S) - At the apex appears B, G and S in its purest form - "purest" - only exist in theory as far as DD is concerned, because you would need perfect information. - o Pure reciprocity (civil society) o Pure exchange (business) o Pure coercion (gov’t) - All inner territory represents orgs embodying different mixes of the three – a variety of socioeconomic AND gov’t relationships o - Rules or “sorting” mechanisms of coordination for each segment are based on different principles - refers to how these sectors actually work. o Business – supply and demand forces at the end of the day S&D are the sorting mechanisms for business o Gov’t – redistribution and coercion - we coerce you to pay your taxes and then we redistribute the money o Civil society – cooperation, reciprocity and solidarity - has a very dif set of sorting methods. "I'll do something for you, you do something for me" simple trust and networks. ie social capital (more on that later) - Note that o The boundaries between B, S, and G are not well-defined because they are not rigid frontiers – but rather wavering and continually evolving zones of overlap, interaction and interdependency - be better to depict it as a dotted line - ie economic meltdown - immediately everyone tells the gov't to regulate, but before that everyone was telling the gov't to go away. Enron/worldcom. 9/11 - gov't protect us! o An initial survey reveals that in Canada each of these three segments now occupies approximately one-third of the organizational/institutional territory denoted by the surface of the Boudling triangle About this Course - This course explores business in its social context - Business, and its affect on gov’t and civil society, and their affect on business - It’s more than simply making a profit - Business’s relation with “society” is increasingly complex About how you will be taught - Through o A highly interactive approach where in-class discussion is encouraged o Lectures and videos (where practicable) o Guest lecturers (when possible) - Jordan, lobbyist About the material - The course outline is available on doc-depot and you must review – indicates subjects, dates, regulations… - Most of the slides you will see in this class will be posted on BB - Required text book - You must be here to do well- hints, discussions, material that you will be responsible for. Your Responsibilities - Note carefully: you are responsible for all material covered on the course outline including o all text book references (chapters to be read) whether or not explicitly covered in the lecture 3 o all slides presented in the lecture  many slides contain material that is not explicitly covered in the text book o all content of class discussions including any case studies o all video material o all in-class group work o you must monitor your uOttawa email account About Expectations 1. you will real all text book, materials assigned and course lecture slides, in accordance with the outline before coming to class 2. you must attend lecture to do well in this class 3. you will participate fully in class discussions 4. you will not hesitate to ask the prof for clarification on any part of the course material that is not sufficiently clear for you Lecture 2 – The Canadian business Segment The Macroenvironment of Canadian Business - business drives the economy, it is not the gov't. the gov't fosters an environment in which business can drive the economy - business drives the economy of a nation - the economic system in Canada is a private enterprise system o rewards firms for effectively and efficiently meeting the wants and needs of customers o basic rights of a private enterprise system:  private property  freedom of choice  profits  competition - Six distinct time periods define north American business history o Colonial (before 1776)  Agricultural production o Industrial revolution (1760-1850)  The advent of the factory system and mass-production o Industrial entrepreneurs ( late 1800s)  Risk-takers and inventors; advances in technology o Production (late 1800s-1920s)  Assembly lines, producing greater quantity faster o Marketing (since 1950s)  Consumer orientation o Relationship (from 1990s)  Strategic alliances between customers, suppliers  the recognition that business cannot do it all by itself anymore. We work together so that everyone wins. I might sell widgets but I don't manufacture them b/c it wouldn't make sense. I work with suppliers who work with manufacturers etc. we work together and foster relationships - The workforce of today: you need to accept a variety of work life balance. the story goes that for baby boomers it was all about the job, which defined them and came first. they were born post-war. then you have the younger generation (X/Y) - is it fair that the younger generation are more interested in work- life balance. some articles suggest the younger generation don't want to marry into a company. they will go to the higest bidder and they want work-life balance. as future managers we will have to manager this. it is conceivable that we will be managing our own workforce, which will have differnet types of people who are motivated by different things. you need to get inside everyone's head. o Aging population o Shrinking labour pool o Increasing diversity - 2/3 of canadian population is from immigration you need to be culturally sensitive, not just in other countries but in canada. the diversity of the workforce we manage will have different cultures. 4 o Outsourcing & the changing nature of work - most manufacturing is outsourced. most Canadian business is in service o Flexibility and mobility - younger workers don't subscribe to work comes first lifestyle o Innovation through collaboration The Canadian private sector forms of business ownership be able to differentiate these different types of businesses. - Sole proprietorship o The simplest form of business organization available to any individual who is legally able ot enter into a binding contract o SPs fall under provincial and municipal jurisdiction o Filing a name declaration is not required provided the proprietorship operates under a person’s name o Owned and operated by one person o owners & managers are one and the same o must be legally able to enter into a contract (not in jail/insane) Advantages: Disadvantages  Easy & cheap to start  Unlimited liability - if something goes  Secrecy - ie an intellectual idea that you wrong and you go under, you are use for consulting. If it's a partnership you responsible for all debts of the business have to share with partner  Limited financial resources  Flexibility and control  Limited skills pool - management team of  Pride of ownership 1.  Distribution and use of profit  Overwhelming time commitment -  No special taxes  Few fringe benefits  No gov’t regulation  Limited growth - limited to your own resources  Limited life span - Partnership o An arrangement whereby two or more persons combine some or all of their resources in a business undertaking with a view to sharing profits among partners o Provincial laws require that a partnership must legally register its name and give info about the partners o partnership agreement drives the whole thing. could be any number of details within the agreement o owners & managers are one and the same o types - be able to differentiate between these  General  Partners are not only liable in equal share for the debts of the partnership (jointly liable) but in addition, each partner is liable for the full amount (jointly & severally liable)  Each member can bind the partnership without consent of the other partners  Limited - every partner needs to have at least 1 general able to differentiate between types of partners  Composed of one or more general partners who conduct the business, and one or more persons who contribute an amount in actual cash (special or limited partners)  The special partner’s liability is normally limited only to the amount of the cash s/he contributed to the partnership  Limited partners: - known or unknown to public, active or not mgmt role o Silent partners  Known to the public, no active management role o Secret partners  Unknown to the public, but take an active role in management 5 o Nominal partners  Lend their name for public relations, but are actually not involved o Dormant partners  Neither known to the public nor active in management Advantages: Disadvantages  Ease of organizatio
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