Chapter 13 explored the similarities and differences of public and private sector labor relations. Over the last two decades, a series of laws have affected labor-management relations in the private sector. Public employee unions have effectively raised wages and benefit levels. Although public unions are not growing, they will play an important role in policy and outcomes in the public sector.
As you recall, multinational corporations (MNCs) in the United States are astronomical in size. Chapter 14 discussed the operations of MNCs in a global economy and unions’ approaches and problems in dealing with MNCs.
Write a 2-3 page current event essay in which a recent news article is analyzed and related to the course topics in chapters 13 and 14. You will be graded on your ability to follow directions and articulate how the chapter topics relate to the article of your choice.
Category: Labor relations
Read the attached Case Study – Should the Union Represent Slick Willie Owens? In a 2-3 page paper, utilize the questions at the end of the case study as a guide for your reflection paper. Support your answers with concepts/terms from chapter 10 and if necessary, use outside sources.
Identify two companies—one that you believe pursues a lowest-cost strategy and another that pursues a differentiation strategy. Relying on
personal knowledge, company annual reports, or articles in newspapers and
business periodicals, discuss their competitive strategies.
Please respond in short to theses students comments:
Ian
A company that
operates with a lowest cost strategy would be Amazon. One of Amazon’s
strategies is to produce products that are similar to their competitors at a
lower cost. Since they are able to mass-produce products at a lower cost it
allows them to gain greater profits. The low price point also makes it
difficult for competitors to compete for business. Amazon has also been known
to sell their competition on their website only to mass-produce a product of
equal quality at a lower price point.
A company that
operates with a differentiation strategy would be Nike. This company offers
products with a higher average cost than the marketplace dictates but they are
also the only company that produces the Jordan brand which is a multi-billion
dollar brand. Their strategy is to offer luxury at luxury prices to make the
customer feel unique with the product they purchased. I believe their strategy
is to convince the consumer that their quality has no equal.
Drake
Greetings
professor/class,
I choose Aldi and
Apple Inc. to make my comparison. Aldi and Apple Inc. are two companies
that operate in very different industries and have distinct business models and
strategies. I will compare them in terms of their strategic approaches.
Aldi is a global
discount supermarket chain known for its low-cost strategy. The company focuses
on offering high-quality products at significantly lower prices compared to its
competitors by keeping operating costs low. Aldi achieves this through various
means such as limited product selection, private labeling, cost-effective store
layouts, and efficient supply chain management.
Apple Inc., on the
other hand, does not primarily compete on a lowest cost strategy. Apple Inc. is
known for its premium pricing strategy, positioning itself as a provider of
high-quality, premium products with a focus on design and innovation. While Apple
Inc. products are generally priced higher than competitors, the company
justifies this through product differentiation, brand value, and customer
loyalty.
While Aldi’s primary
strategy is based on a low-cost model, the company also differentiates itself
through its unique product offerings, especially in the realm of private-label
products. Aldi focuses on offering quality products that are exclusive to its
stores, creating a differentiated shopping experience for customers.
Apple Inc. is a prime
example of a company that excels in differentiation strategies. Apple Inc.
products are known for their distinctive design, user-friendly interfaces,
seamless integration across devices, and ecosystem of services like the App
Store and iCloud. Apple’s focus on innovation, product design, and customer
experience sets it apart from competitors.
Aldi competes in the
retail industry by offering a combination of low prices, quality products, and
a unique shopping experience. The company focuses on cost leadership,
efficiency, and constantly improving its product offerings to attract and
retain customers.
Apple’s competitive
strategy revolves around innovation, product differentiation, brand loyalty,
and ecosystem lock-in. The company invests heavily in research and development
to create cutting-edge products that set industry standards. The seamless focus
on creating a seamless ecosystem of hardware, software, and services enhances
customer loyalty, and drives repeat purchases.
In summary, while both Aldi and Apple Inc. have distinct
strategies and business models, Aldi primarily focuses on the lowest cost
strategy with elements of differentiation, while Apple Inc. excels in
differentiation strategy and premium pricing. Their competitive strategies
reflect these core approaches, with Aldi emphasizing cost leadership and
efficiency, and Apple Inc. prioritizing innovation, design, and customer
experience.
2. Consider
a job you previously held or your current job.
Review the textbook chapters assigned for this week paying particular attention
to the staffing components model in chapter 1 to assist you in thinking through
and analyzing the staffing process that led to your getting hired for the job.
Trace and describe the process from your own perspective as a job applicant and
from the organization’s perspective.
Considering the Applicant Perspective
Why did you identify
and seek out the job with this organization?
How did you gather
information about the job’s requirements and rewards?
Why did you decide to
continue on with the staffing process, rather than drop out of it?
Considering the Organization Perspective
(Even if you are unsure of the answers to the following
questions, try to answer them or guess at them.)
How did the
organization identify you as a job applicant?
What techniques
(application blank, interview, etc.) did the organization use to gather KSAO
information about you?
(KSAO: Knowledge, Skills, Abilities and Other Characteristics)
Why did the
organization continue to pursue you as an applicant, rather than reject you
from further consideration
Reactions to the Staffing Process
What are your
reactions to the staffing process? What were the strong points? What were the
weak points? What changes would you like to see made in the process? Why?
Please respond to the following students:
Dominique
Considering the Applicant Perspective
Why did you identify and seek out the job with this
organization? I currently work as a customer service representative for
the state, and I identified with this job because it is a work from home job,
and it has so many opportunities for advancements.
How did you gather information about the job’s requirements and
rewards? Before completing the application, the job requirements are
posted on the page. I saw that I had all the skills requested so I went ahead
and applied. I googled the rewards that come with the job, and I asked a friend
because she currently works for the state. The perks of this job are the best
compared to previous jobs.
Why did you decide to continue on with the staffing process,
rather than drop out of it? I decided to continue with the staffing
process because of the perks of working with the state. You get bonuses, paid
time off, and holidays off. It was the best thing I have done in a while.
Considering the Organization Perspective
(Even if you are unsure of the answers to the following
questions, try to answer them or guess at them.)
How did the organization identify you as a job applicant? I
think that I met the requirements of the job.
What techniques (application blank, interview, etc.) did the
organization use to gather KSAO information about you? I think the
reviewed my resume to get the information about my skills, abilities, and my
capability to do the job.
(KSAO: Knowledge, Skills, Abilities and Other Characteristics)
Why did the organization continue to pursue you as an applicant,
rather than reject you from further consideration? I think the
organization was in dire need of people because they are still hiring people
back-to-back.
Reactions to the Staffing Process
What are your reactions to the staffing process? What were the
strong points? What were the weak points? What changes would you like to see
made in the process? Why? My reactions to the staffing process was that
I couldn’t believe how long it took to get hired. It took over three months to
start working after I was told I had the job. Strong points were that you had
an interview with down to earth people who judged you off your abilities and
not your interviewing skills. Weak points were that sometimes I felt like they
weren’t really listening to me, and they were just jotting down notes about our
conversation during the interview process. The changes I would like to make
would be speeding up the amount of time it takes to start once you have been
hired for the job. If you are trying to leave a dead-end job and start
somewhere strong, I don’t think it suits the applicant to wait that long. I
could have found another job in that time frame of waiting.
Chrystal
Considering the
Applicant Perspective
Why did you identify and seek out the job with this
organization?
As a contracts & closings supervisor, my
attention to detail and top-notch time-management skills are essential to
success in the role. Specifically this organization has an impressive benefits
package and promising opportunities to grown within the company.
How did you gather information about the job’s requirements and
rewards?
A portion of this role is dedicated to being the division’s
ambassador, responsible for onboarding new hires and facilitating the company’s
culture. With that is the access to the upcoming improvements to benefits,
rewards programs, and job profile changes.
Why did you decide to continue on with the staffing process,
rather than drop out of it?
To be honest, the staffing process was pretty extensive and
thorough, but my situation was unique in that I started with the company as a
temp prior to the pandemic. I then became a fully onboarded employee during the
pandemic and I wasn’t willing to start with another company! Overall, very
happy with my choices as the extensive staffing process ensures we have the
right individuals working with us toward the same goals.
Considering the Organization Perspective
How did the organization identify you as a job applicant?
Investing in the best recruiting practices that can be most cost effective
can sometimes lead a company to enlisting the services of a temp company, which
is how I was identified as an applicant with this organization. The basic
skills for the job were already identified through the temp agency, making the
match easy.
What techniques (application blank, interview, etc.) did the
organization use to gather KSAO information about you
After working for a few months as a temp, they were able to
assess that my skills were greater than the role and this was obtained through
performance reviews at a junior level. My efficiency and accuracy with closing
homes allowed the organization to determine I needed to be developed even
further in my career, while my personality proved the hunger for a challenge.
Why did the organization continue to pursue you as an applicant,
rather than reject you from further consideration?
Proving to be knowledgeable, reliable, and with a clean
background check, the organization saw me as an asset rather than a risk and
continued to bring me on full-term.
HCC Management Team Bargaining Information
You are the Human Resource Manager, and have been tasked with developing the Management proposals for the upcoming negotiations with the Union. The Management team is expected to negotiate an agreement that will allow the company to achieve its strategic goals over the next three years. You Management team has shared the following long-term information with you, allowing you to see that they have carefully thought out the long-term mission for the organization.
Item 1. Managerial Compensation
HCC managers received 5% across-the-board annual raises for each of the past three years which has caused considerable resentment among the union rank-and-file. Future managerial compensation increases will take the form of at-risk annual lump-sum bonuses based on achieving the projected strategic yearly goals. The lump sum bonus plan was initiated due to the need to reduce operational costs in order to fund the needed upgrade to production equipment.
Attaining all strategic goals in any one year will yield a 20% total annual bonus to the Senior Managers. The extent to which future strategic goals are expected to be achieved (as reflected in the feasible terms of the new contract) will serve to assess the negotiating success of the management bargaining team in the simulation.
This information, to the best of your knowledge, is not known to the employees or the Union Bargaining Committee. However, two Managers at the site have spouses that are Union employees. Both Managers have been advised not to share this information with their spouses, due to confidentiality concerns.
Item 2. Union Employee Compensation
The average hourly wage for Production employees at the site is $16.00 per hour. There are a total of 1,000 Unionized production workers at the site, with all working a five day, 40-hour week. Little to no overtime is worked. Thus, the average annual wage for Production employees equals $33,280 dollars per year.
The planned automation to the production equipment will result in a thirty (30) headcount reduction in the first year of the bargaining agreement. The cost savings of this transformation will reduce operational labor costs by a total of $1 Million dollars per year.
Item 3. Strikes, Lockouts, Unfair Labor Practices
Management may elect to lockout labor at any time if it believes that no reasonable progress has been made in negotiations. Work stoppages will severely damage HCC customer relationships and its valued reputation as a firm dedicated to the prompt delivery of quality products.
Item 4. Facilities Upgrade and Production Manning
In order to meet customer demands for higher product quality, to comply with federally-mandated environmental regulations, and to reduce production costs, HCC must spend $2,000,000 within the next three years to upgrade equipment. The upgrade is expected to result in production efficiency gains that will lower material and labor costs by reducing defective products, process waste, in-process inventory, and production man-hours through simplified work processes.
The proposed facilities upgrade and subsequent manning reduction have not yet been discussed with the union. The company will introduce its demand for the facility upgrade, the manning reduction, and the change to continuous operations in its initial demands.
Item 5. Health Benefit Costs
HCC employees currently have a first-dollar (no deductible or co-pay) health benefits package that costs $3,500 annually per employee. If left unchanged, the cost of health benefits is expected to increase 10% annually for each of the next three years.
A provider has offered an HMO-type plan for $3,000 per employee that limits cost increases to 3% per year. Under the proposed HMO contract, employees will pay a $500 annual deductible before full coverage is assumed by the plan. In an effort to contain its rising health care costs, the company will include the demand for a change to the HMO contract in its initial demands. This proposed plan will save the company a total of one (1) million dollars per year, based on the forecast savings of $1,000 per employee cost and additional reductions in the chargeback for services from providers in the HMO plan.
Item 6. Other Informational Items
* The current contract includes six paid holidays and two days of miscellaneous leave.
* The second shift differential is currently $0.15 cents per hour and third shift differential is $0.25 cents per hour. These shift premiums have remained unchanged for over ten years.
Your Challenge by Upper Management
The planned headcount reductions of thirty (30) production job, plus the additional savings forecast from the change to the HMO medical plan is sufficient to fund the two (2) million-dollar cost of the planned facility upgrade to automated equipment. Built into the headcount reduction cost estimate is a severance package for those Union employees who will be laid off, with extension of benefits for one full year, and two weeks of pay to each employee for each year of service. This added cost does not need to be included in the negotiation calculation, as it is already forecast in the cost of the automation upgrade.
Any new Union proposals agreed to at negotiations with the Union above and beyond $1 million dollars per year must be primarily offset with the Union accepting cost-reduction proposals in other areas of the Collective Bargaining Agreement. Your total allocated budget for negotiations only permits a total of $1 million dollars in increased cost, per year, for each year of the new Collective Bargaining Agreement. For the purpose of this exercise we will only cost out year 1 of the new labor agreement.
In summary – upper management has allocated you to spend up to $1 million dollars in increased cost in the upcoming Collective Bargaining negotiations session. However, if the proposed HMO is modified, reducing the cost savings, then your allocated budget to spend is reduced by that amount as well.
From your perspective, the amount of dollars allocated for increases to Union employees is low, but upper Management has stated they are willing and able to take a strike, if necessary, in order to achieve these cost objectives.
They state they have full confidence in your ability to negotiate a new agreement with the allocated ranges, and expect you to deliver an agreement acceptable to the Union.
Your strategy is to focus on two, and only two economic areas: hourly wages and shift differential. You believe doing so provides the ability to disperse the $1 million dollars of added spending you have been allocated, which will meet the minimum expectations of the Union employees, avoiding a lengthy strike.
This approach means any proposals outside of these two areas would have to be either rejected, or offset by lower hourly wage increases and/or reduced increases in the shift differential.
Directions
1. Read the attached article, entitled Interest Based Bargaining. 2. Using the BATNA Concept discussed in the article as the framework for your paper describe your strategy using the following Subheadings in your paper:
Identify the Interests, i.e., the interests that both Management and the Union have in process, briefly summarizing the Substantive Issues, Procedural Interests, and Psychological Interests.
3. Choose your team – You will be the Chief Negotiator in your position of Human Resource Manager. Choose other team members that you believe are needed to be part of your Management team. 4. Frame the Issue:
Summarize the two major transformations Management is seeking in Negotiations:
- Automation of Production Equipment, and the resulting layoff of 30 Union employees due to increases in production efficiencies. The upgrade will result in a $1 million dollar cost savings per year. – Change in the Medical plan to the HMO plan. The change will result in a $1 million dollar cost savings per year. – Any increases in Union labor production costs must be reasonable, as the organization is facing continued economic pressure from its competitors in the marketplace. 5. Generate Options – You will be focusing on only two proposals – an hourly wage increase and changes in shift differential. Three sample positions are provided for your review in the Excel wage calculator. Feel free to modify these three positions as you deem appropriate. 6. Summarize your Final Offer to the Union, ensuring the total cost of your proposal does not exceed $1 Million dollars per year, plus or minus 5%. ($950,000 – $1,050,000). The Final offer should simply be listed in the paper, highlighting the percent increase in hourly wages and the change, if any, in second and third shift differential.
The following attachments provide you with the necessary information to successfully complete this Case Study assignment:
HCC Management Team Bargaining Information
You are the Human Resource Manager, and have been tasked with developing the Management proposals for the upcoming negotiations with the Union. The Management team is expected to negotiate an agreement that will allow the company to achieve its strategic goals over the next three years. You Management team has shared the following long-term information with you, allowing you to see that they have carefully thought out the long-term mission for the organization.
Item 1. Managerial Compensation
HCC managers received 5% across-the-board annual raises for each of the past three years which has caused considerable resentment among the union rank-and-file. Future managerial compensation increases will take the form of at-risk annual lump-sum bonuses based on achieving the projected strategic yearly goals. The lump sum bonus plan was initiated due to the need to reduce operational costs in order to fund the needed upgrade to production equipment.
Attaining all strategic goals in any one year will yield a 20% total annual bonus to the Senior Managers. The extent to which future strategic goals are expected to be achieved (as reflected in the feasible terms of the new contract) will serve to assess the negotiating success of the management bargaining team in the simulation.
This information, to the best of your knowledge, is not known to the employees or the Union Bargaining Committee. However, two Managers at the site have spouses that are Union employees. Both Managers have been advised not to share this information with their spouses, due to confidentiality concerns.
Item 2. Union Employee Compensation
The average hourly wage for Production employees at the site is $16.00 per hour. There are a total of 1,000 Unionized production workers at the site, with all working a five day, 40-hour week. Little to no overtime is worked. Thus, the average annual wage for Production employees equals $33,280 dollars per year.
The planned automation to the production equipment will result in a thirty (30) headcount reduction in the first year of the bargaining agreement. The cost savings of this transformation will reduce operational labor costs by a total of $1 Million dollars per year.
Item 3. Strikes, Lockouts, Unfair Labor Practices
Management may elect to lockout labor at any time if it believes that no reasonable progress has been made in negotiations. Work stoppages will severely damage HCC customer relationships and its valued reputation as a firm dedicated to the prompt delivery of quality products.
Item 4. Facilities Upgrade and Production Manning
In order to meet customer demands for higher product quality, to comply with federally-mandated environmental regulations, and to reduce production costs, HCC must spend $2,000,000 within the next three years to upgrade equipment. The upgrade is expected to result in production efficiency gains that will lower material and labor costs by reducing defective products, process waste, in-process inventory, and production man-hours through simplified work processes.
The proposed facilities upgrade and subsequent manning reduction have not yet been discussed with the union. The company will introduce its demand for the facility upgrade, the manning reduction, and the change to continuous operations in its initial demands.
Item 5. Health Benefit Costs
HCC employees currently have a first-dollar (no deductible or co-pay) health benefits package that costs $3,500 annually per employee. If left unchanged, the cost of health benefits is expected to increase 10% annually for each of the next three years.
A provider has offered an HMO-type plan for $3,000 per employee that limits cost increases to 3% per year. Under the proposed HMO contract, employees will pay a $500 annual deductible before full coverage is assumed by the plan. In an effort to contain its rising health care costs, the company will include the demand for a change to the HMO contract in its initial demands. This proposed plan will save the company a total of one (1) million dollars per year, based on the forecast savings of $1,000 per employee cost and additional reductions in the chargeback for services from providers in the HMO plan.
Item 6. Other Informational Items
* The current contract includes six paid holidays and two days of miscellaneous leave.
* The second shift differential is currently $0.15 cents per hour and third shift differential is $0.25 cents per hour. These shift premiums have remained unchanged for over ten years.
Your Challenge by Upper Management
The planned headcount reductions of thirty (30) production job, plus the additional savings forecast from the change to the HMO medical plan is sufficient to fund the two (2) million-dollar cost of the planned facility upgrade to automated equipment. Built into the headcount reduction cost estimate is a severance package for those Union employees who will be laid off, with extension of benefits for one full year, and two weeks of pay to each employee for each year of service. This added cost does not need to be included in the negotiation calculation, as it is already forecast in the cost of the automation upgrade.
Any new Union proposals agreed to at negotiations with the Union above and beyond $1 million dollars per year must be primarily offset with the Union accepting cost-reduction proposals in other areas of the Collective Bargaining Agreement. Your total allocated budget for negotiations only permits a total of $1 million dollars in increased cost, per year, for each year of the new Collective Bargaining Agreement. For the purpose of this exercise we will only cost out year 1 of the new labor agreement.
In summary – upper management has allocated you to spend up to $1 million dollars in increased cost in the upcoming Collective Bargaining negotiations session. However, if the proposed HMO is modified, reducing the cost savings, then your allocated budget to spend is reduced by that amount as well.
From your perspective, the amount of dollars allocated for increases to Union employees is low, but upper Management has stated they are willing and able to take a strike, if necessary, in order to achieve these cost objectives.
They state they have full confidence in your ability to negotiate a new agreement with the allocated ranges, and expect you to deliver an agreement acceptable to the Union.
Your strategy is to focus on two, and only two economic areas: hourly wages and shift differential. You believe doing so provides the ability to disperse the $1 million dollars of added spending you have been allocated, which will meet the minimum expectations of the Union employees, avoiding a lengthy strike.
This approach means any proposals outside of these two areas would have to be either rejected, or offset by lower hourly wage increases and/or reduced increases in the shift differential.
Directions
1. Read the attached article, entitled Interest Based Bargaining. 2. Using the BATNA Concept discussed in the article as the framework for your paper describe your strategy using the following Subheadings in your paper:
Identify the Interests, i.e., the interests that both Management and the Union have in process, briefly summarizing the Substantive Issues, Procedural Interests, and Psychological Interests.
3. Choose your team – You will be the Chief Negotiator in your position of Human Resource Manager. Choose other team members that you believe are needed to be part of your Management team. 4. Frame the Issue:
Summarize the two major transformations Management is seeking in Negotiations:
- Automation of Production Equipment, and the resulting layoff of 30 Union employees due to increases in production efficiencies. The upgrade will result in a $1 million dollar cost savings per year. – Change in the Medical plan to the HMO plan. The change will result in a $1 million dollar cost savings per year. – Any increases in Union labor production costs must be reasonable, as the organization is facing continued economic pressure from its competitors in the marketplace. 5. Generate Options – You will be focusing on only two proposals – an hourly wage increase and changes in shift differential. Three sample positions are provided for your review in the Excel wage calculator. Feel free to modify these three positions as you deem appropriate. 6. Summarize your Final Offer to the Union, ensuring the total cost of your proposal does not exceed $1 Million dollars per year, plus or minus 5%. ($950,000 – $1,050,000). The Final offer should simply be listed in the paper, highlighting the percent increase in hourly wages and the change, if any, in second and third shift differential.
The following attachments provide you with the necessary information to successfully complete this Case Study assignment:
You will write a 350 word paper on what you learned in the course. Be sure to touch on several concepts that you felt were most significant and why.
In files it what you need to write the reflection paper on.