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How Much Control Do You Have Over Employees? April 17, 2007

Posted by Elaine in Business-Society Issues, Employees.

I came across an article that featured an employer wondering what she can do about her workers that smoked cigarettes. Insurance companies charge a higher rate for employees that smoke. Employees obviously do not smoke at their workplace, but some do when they are off the clock. Is it fair for the employee to require that her workers do not smoke at all? It would save the company a tremendous amount of money in the insurance department.

Unfortunately for the employer, there are laws stating you cannot discriminate an applicant for their activities outside of the work place. This includes risky behavior such as bungee jumping, sky diving, etc. I remember watching the movie “Along Came Polly.” The guy’s job was to calculate how much insurance/risk each person was worth. His client would partake in extreme activities such as parachuting, hand-gliding, and free falls. He would constantly be stressed out and warned his client that he was too expensive to insure. Are there laws stating that you cannot limit the activities an individual can do just because of insurance purposes?

Helping out the employer, there are laws that allow them to pass the higher costs of insurance over to the smoker. Instead of being discriminated against and now allowed to have the job, these workers just have to pay the additional insurance money. Is this a fair practice?


College Loan Programs Fleecing You (students) and Me (taxpayer) April 14, 2007

Posted by Jordi in Business-Society Issues, Education, Government.

Lenders Sought Edge Against U.S. in Student Loans – New York Times
President Bush’s budget reports that in 2006 for every $100 lent by private lenders, the cost to the government of subsidies, defaults and other items was $13.81, while the same amount lent through the direct loan program cost the government $3.85. The battle for dominance in the loan market has escalated as tuitions have soared and students have borrowed more

Lovely. The formula: corruption + free market ideology=fleecing of public.

Its in full swing. I want to find out if Bucknell participates in the direct loan program which allows the Federal Government to make direct loans to students. The article reports that some schools withdrew under pressure from private banks looking to force more loans their way.

US Federal Budget April 12, 2007

Posted by Jordi in Business-Society Issues, Government.

Tax Season gto me thinking about the US federal budget.

Here is a helpful pie chart.

PIe chart of federal budget from CBP

Is this what you expected? How many politicians put this front and center and explain what they would keep and what they would change?

Innovation – can it be too much to handle? April 11, 2007

Posted by silviamocanu07 in Business-Society Issues.
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The article that I found on Business Week, called “How to Live Up to the Innovation Hype”( http://www.businessweek.com/innovate/content/apr2007/id20070410_471842.htm?chan=innovation_innovation+%2B+design_top+stories), mainly discusses the case of a company called Iridium, which had a very public bankruptcy in 2000. Iridium produces portable phones with service provided by satellite networks, and the main reason behind its past failure as a public enterprise, was the fact the company “launched innovative products and services but didn’t live up to the initial hype” (page 1).  In addition, one of the other main problems associated with “Next Big Thing”-companies like Iridium is the difficulty that they experience when identifying and reaching their target market, because their techonologies are “so fresh and so unprecedented”(page 2).

However, companies like Iridium have managed to re-establish themselves and to “refine their technologies, remake their business models, and reach out to new audiences” (page 1). It seems as though new and creative marketing solutions, as well as sound technology improvements have truly made a difference in the success of such high-tech enterprises. Iridium, for example, was bought over by private investors in 2001 and now it is operating profitably, at a smaller scale than in the past.

When thinking about this niche market comprised of high-tech companies, do you really think that marketing is one of the pivotal factors, such as the article suggests? I believe that the way that a product is marketed constitutes a decisive factor in whether it will be successful or not. The correct market segmentations must be made and the product must be made known to the target group, otherwise it will fail. This is even more so the case with high-tech products that must be first positioned in the market and made known to the target market segment.  What do you think?

CEO Pay, Stock Price II (And worker pay too!) April 11, 2007

Posted by Jordi in Business-Society Issues, CEOs.
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Here is another view of CEO pay and Stock performance. Worker pay is also thrown in for good measure.

This is drawn from multiple sources. United FOr a Fair Economy compiled it from:

Total executive compensation: 2005 data based on Wall Street Journal survey, April 10, 2006; all other years based on similar sample in Business Week annual compensation surveys (now discontinued). Includes: salary, bonus, restricted stock, payouts on other long-term incentives, and the value of options exercised.
S&P 500 Index: Economic Report of the President, 2006 Table B-96; 1997, 2000 Table B-93; average of daily closing prices.
Corporate Profits: U.S. Department of Commerce, Bureau of Economic Analysis, National Income and Product Accounts, Table 6.16, with inventory valuation and capital consumption adjustments.
Average worker pay: Based on U.S. Department of Labor, Bureau of Labor Statistics, Employment, Hours, and Earnings from the Current Employment Statistics Survey (average hourly earnings of production workers x average weekly hours of production workers x 52).
Minimum wage: Lowest mandated federal minimum wage, nominal; U.S. Dept. of Labor, Employment Standards Administration, Wage and Hour Division.
Adjustment for inflation: BLS, Average Annual CPI-U, all urban consumers, all items.

One conclusion is that CEO pay is far more sensitive to stock prices than profitability. Average worker pay is insensitive ot these factors. It doesn’t budge.

Do we have control of the ‘bubble’? April 10, 2007

Posted by Abby in Business-Society Issues, humor, Organizational Culture.
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Bucknell is often praised to be a liberal institution.  Our professors are from mixed backgrounds, with mixed opinions, orientations and beliefs.  Why then, are our students so often said to be homogenous?

One sarcastic student wrote in the Bucknellian: “Take a look around, diversity is everywhere. Some people prefer J. Crew, while others are all about Abercrombie. Certain fraternities choose to serve Natural Light, and others enjoy Schaefer. Some kids drive BMWs, while some sport Audis. Clearly, it’s your eyes that need to be opened, not mine. ”

The Plan for Bucknell has 5 main aims, one being diversity.  Diversity is not limited to an increase in the international or culturally diverse students, but those from varying backgrounds too.  Even with all these measures, the University’s control of the student-body makeup alone will not change the attitudes immediately – right?

Would you agree that we are a liberal institution (professors, deans, administrators), with a conservative audience/customer base (the students, or student’s families) ?

Forces of change for strip clubs April 10, 2007

Posted by Lady in Business-Society Issues, Consumers, Employees, Government, Organizational Environment.

I read an article from The Enquirer entitled, “New rules for strip clubs?: Tough new laws could go on Ohio’s ballot.” Basically the article discusses how a group called Citizens for Community Values is putting pressure on Ohio state legislators to pass a Community Defense act which would put restrictions on how strip clubs run their organization. Nude dancing would be banned after midnight and before 6 a.m. In addition, customers would not be allowed to get within six feet of a dancer. Violation of these laws would lead to $1,000 fine and jail time.  

Supporters of the enactment of this law are seeking legislator’s approval because it makes the petition process go a lot faster. However, some people, such as strip club owners, are not in favor of this legislation. So I’d like to post my blog on how strip clubs function as organizations and how forces of change might affect their business. So I was able to point out social forces such as demands from some citizens to tighten their rules in the strip clubs. These citizens feel as though strip clubs have negative effects on the community, such as promoting prostitution and lowering property values.


Another social concern that I thought of was the fact that many of the dancers who work in the strip clubs end up living a corrupted life. In a sense, strip clubs ruin some girls’ lives by promoting promiscuous behaviors. Might some political forces of change also be involved with this situation since legislation is involved? Brian Rothenberg, executive director of a liberal activist group called ProgressOhio, said it is possible that the decision on the legislation could get pushed to 2008 “to drive up turnout for the presidential election.”

What do you guys think of this issue? Should this legislation be passed? Do these strip clubs have a moral obligation to consider to effects that they have on the community including the dancers who work in the strip clubs? Or should the government stay out of this issue because the strip clubs are just providing a service which is highly demanded and helps to also create jobs for these dancers? Do you think that strip clubs will be able to resistance these forces of change?

Financial Aid April 1, 2007

Posted by wilson7 in Business-Society Issues, Education.

Room & board and tuition continue to rise at all schools every year. This is making it extremely difficult for many families that are not financially stable to send their children to some of the elite institution in the country. However, several of the top institutions in the country are making it easier for lower income families to send their children to school. Some of the most highly ranked schools in the United States will eliminate student loans from its financial aid packages. Instead, it will provide all its student aid in the form of grants and work study programs. Harvard does not ask families with incomes under $60,000 to contribute anything toward their child’s education, and reduces the expected family contribution (EFC) for families making $60,000 to $80,000. This will allow several qualified students who would normally not be able to afford to go to school, to attend these institutions. Several individuals graduate from college with thousands of dollars in debt, do you think this is a solution for low income families?

Bucknell University

2006-07 tuition: $36,002

Increase from last year: 9.8%  Avg 2006-07 in-state tuition,
4-year public school: $5,836Avg 2006-07 out-of-state tuition,
4-year public school: $15,783Avg 2006-07 tuition,
4-year private school: $22,218 

 What do you think about what some of these institution are doing? Do you think that Bucknell should implement this financial aid package? If so then how many of these scholarships should they give out a year?


Siemens Executive Arrested March 28, 2007

Posted by silviamocanu07 in Business-Society Issues, Organizational Environment.

     Johannes Feldmayer, one of Siemens’ top executives, was arrested and is suspected of having used company funds to influence the result of its negotiations with IG Metall, Germany’s largest industrial union. Siemens, Europe’s largest engineering firm, is negotiating an increase in workers’ wages with the union. IG Metall is requesting a 6.5% increase, while Siemens is only willing to match half of that percentage. Feldmeyer is thought to have been wrongfully directing company funds to a consulting firm which works with the labor union. Siemens is also undergoing a separate investigation by authorities, as it is believed that the top management of the company has paid millions of Euros for fake consulting contracts, and actually used the money in order to bribe potential customers abroad. The company’s response to the investigations was to cooperate with the authorities, to place stricter internal financial controls, as well as to seek outside legal advice in order to address this situation.

    It is hard to imagine that top executives in such a reputable organization are capable of such unethical and blatantly illegal behavior. One of the main reasonings behind such actions would probably be the desire to reduce labor costs, which can become quite substantial, particularly in a country such as Germany, where labor unions are very strong and hold significant bargaining power with employers.  This is a clear instance of the external environment directly influencing the company’s costs. Do you think that the charges against Feldmayer are justified? What do you think would drive a high-up executive to such actions?

Link to the article: http://online.wsj.com/article/SB117500626744850396.html?mod=home_whats_news_europe

Even our trusted doctors have a price? March 21, 2007

Posted by Meg in agency theory, Business-Society Issues, pharmaceutical, Public Interest.

A set of records from the state of Minnesota show that certain pharmaceutical companies are paying high profile doctors and making substantial donations to clinics throughout the United States. This information became apparent due to a Minnesota law stating that drug companies must disclose all payments made to doctors. Patient advocacy groups are concerned about this revelation and the influence that various drug companies may, in fact, have over doctors.

Since 2005, drug companies have paid health care workers $57 million in the state of Minnesota alone. Most doctors, however, assure the public that these payments do not influence their treatment of patients, but are merely to give marketing talks. Some even state that close ties between doctors and drug companies enable those in the medical field to be more educated about various prescription drugs and more able to advise their patients on whether or not and how to use these drugs in a healthy way.

Research exists, however, to indicate that doctors with a close relationship to various drug companies often prescribe more modern (as well as expensive) drugs that may not be in the best interest of patients. Due to public scrutiny of various pharmaceutical companies and the FDA as well as reasonable evidence indicating that numerous medications are over-prescribed, these records may concern more patients who wonder whether their doctor’s advice is in the patient’s best interest or the doctor’s.