Part One: DVD Case Overview
I. DVD Case Focus
The central concept of the DVD case is Social Responsibility at Starbucks.
II. DVD Case's Main Topics/Sources of Information
· This information in this case was presented by Mr. Dub Hay, Starbucks' Senior Vice President of Coffee, in an interview
· Mr. Hay presented the information by telling a story using verbal narration, visual display, film, and a graphic map
III. Main Topics included:
· A brief history of Starbucks
· The image of the Starbucks’ experience
· A description of the Starbucks’ customer
· Coffee tasting and quality assurance
· CAFÉ practices (Coffee and Equity Program) and social programs
· Relationships with foreign governments
· A description of the international coffee market
· Development of relationships with coffee suppliers (farmers)
· Future ideas for improvement
IV. DVD Case's Data Presentation Approach
| Main Topic | How Presented |
| A brief history of Starbucks | Mr. Dub Hay gave a verbal time line from 1971-1992, and explained how Howard Schultz bought out the original partners, defined the Starbucks' experience, and took the company public in 1992 |
| The image of Starbucks | Explained that Howard Schultz on a trip to Italy envisioned Starbucks as not a place to have coffee drinks, but a coffee house. Coffee was no longer a generic product, but it was intrinsically linked to Starbucks. |
| A description of the Starbucks' customer | Described the typical Starbucks customer as loyal, since they visit a Starbucks at least 18 times per month |
| Coffee tasting and quality assurance | Mr. Hay gave a visual display of “atomizing” whereby the coffee taster allows the coffee to cross his palate. This is a way to insure the quality assurance of the coffee. |
| CAFÉ (Coffee and Equity Program) Practices | Starbucks has developed programs with non-government agencies (NGO’s) in developing countries to ensure that coffee farmers will stay in business and coffee workers will have a certain level of sustenance |
| Starbucks relationships with foreign governments | According to Mr. Hay, Starbucks' management regularly visits foreign governments. He did not give a clear idea of what transpired. He only said that Starbucks did not interfere with the laws of the country. |
| A description of the international coffee market | Switzerland is the “coffee capital of the world” although it is a developed country. The coffee industry has been in crisis. Overproduction by certain countries explained the ups and downs of supply and demand. |
| Who are the Coffee Suppliers/Buyers | Starbucks has suppliers in 20-30 countries primarily located in four areas of the world: Asia, Central America, Africa, and the Arabian peninsula; there are 240 buyers purchase coffee for Starbucks |
| Relationship development with coffee suppliers | According to Mr. Hay, these relationships have taken years to develop, requiring a Starbucks representative who talked best practices on a day by day basis |
| Future Ideas for improvement | The daily presence continued to be required, and even more skilled representation (a coffee agricultural specialist) has become a necessity |
V. DVD Case's Significance
One audience who benefited from this case as presented on the DVD was qualitative management researchers who have focused on and investigated the relationship between corporate viability and corporate social responsibility (CSR).
| Information Presented | Benefit |
| CAFÉ (Coffee and Equity Program) | The audience benefited from knowing that a company has set up a successful CSR program to benefit growers and workers and from an understanding of how the program worked |
| Relationship development with coffee growers | The relationships required years to develop and continued monitoring once they were established. |
| Image of Starbucks | Howard Schultz was a visionary who redefined the coffee experience. By developing a customer who can discern the unique nature of the Starbucks’ product and environment, he elevated the coffee experience. |
| Coffee tasting and quality assurance | Starbucks’ coffee was no longer a generic product, and it became very much like wine to be savored and developed from year to year and region to region. |
Part Two: Justifying and Proposing New Research
I. Proposed Research Questions for the New Study
- How will Corporate Social Responsibility (CSR) impact employees in general?
- What will be the reasons for and components of a socially responsible wage and benefit package?
- How will an employee wage and benefit package developed under CSR principles affect employee morale?
II. Case Study:
Study focus: The study focus will be on CSR, employee wage and benefits, and employee morale.
How will the employees benefit from the CSR program?
From the employees’ standpoint, what will be the consequences of taking the selected course of action?
What will be the responses to the CSR program that emerge?
How will a socially responsible wage and benefit program affect employee morale?
III. Significance of the Proposed Study
Since the intended audience of new research will be qualitative researchers and Human Resource researchers, they will understand the general scope and importance of CSR. Examples of how the conclusions of the research will specifically be used by the audience are to:
· Understand the relationship of a fair and equitable wage and benefit package on employee morale
· Explore the commitment of employees to a career, not a job.
· Comprehend how a company can enhance its image of a responsible corporate citizen: (1) providing good jobs at a good wage for neighborhood citizens and others; and (2) becoming an employer of choice.
IV. Justification for New Research
This study will offer a logical next step to the current research (under Creswell's justification #2) in that it explores on the micro level how a socially responsible program and employee wage and benefit package will affect employee morale (Creswell 1998). The purpose of this qualitative study will be to explore the effects of CSR and an employee wage and benefit package on employee morale. The study will follow a Case Study Research design.
V. Proposed Initial Purpose Statement
The purpose of this qualitative study will be to explore the effect of CSR on employees. The study will follow a case study design. At this stage in the research, the central concept, CSR, will be defined as:
The business commitment and contribution to the quality of life of employees [in this case; morale], their families and the local community and society overall to support sustainable economic development. Simply put, the business case for CSR--establishing a positive company reputation and brand in the public eye through good work that yields a competitive edge while at the same time contributing to others--demands that organizations shift from solely focusing on making a profit to including financial, environmental and social responsibility in their core business strategies (Lockwood, 2004).
The present study, itself, may be refined by concentrating on employee morale for human resource management researchers seeking to apply the concepts of corporate social responsibility to employee morale.
VI. Proposed Methodology for Data Collection
The present study is a case study. Under the definition of Creswell, a case study is the exploration of a bounded system, over time and space through a detailed, in depth collection of data (Creswell, 1998, p.61). In this study, the bounded system is CheapMart's socially responsible wage and benefit program: it is bounded by the period of 9 months after the inception of the program, and by the one location, the CheapMart store on Long Island, NY. The data collection will include: interviews, employee events, website traffic, and exit interviews, and other methods of data collection.
The research design is exploratory research whereby the researchers gain an understanding into the general nature of the issue by observing current events.
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A. Interviews
Once the socially responsible wage and benefit program has been put into place, the researchers will conduct interviews with company “key informants” (Myers, 2009):
· employees
· managers
· the Director of Human Resources
Interviews with Employees and Managers
Four interviews with company employees and managers will be conducted. Managers and employees will be in separate groups of 10 people each. Since there are several shifts, concerted efforts will be made to include in the interviews full-time and part-time employees and managers from all shifts. A possible time considered for an interview session will be at a shift change. Hourly employees will be paid double time for the time spent in the interview as an incentive to attend.
The interviews will run for 1.5 hours each. Two interviews (1 for employees and 1 for managers) will be conducted at the 3 month and again at the 9 month point after the implementation. (At the 3 month point, many aspects of the program will be in effect, however, only at the 9 month point, will the effect of the management training and promotion from within programs have a notable effect.)
This series of interviews will be recorded, since they are not of a confidential nature. Other methods of recording will only be considered if the participants are intimidated or have any other type of negative response to the recording method. The interviews will be semi-structured to allow participants the maximum flexibility to make their own contribution.
Each employee will sign a release form which states that they are participating in the interview session of their own free will. No employee will be forced or coerced in any way to participate in the interview sessions.
All interview participants will have the opportunity to review their comments to assure that the comments recorded reflect the true and honest opinions of employees and managers. Participants will have the option to retract their comments.
Interviews with the Director of Human Resources
The Director of Human Resources was the first advocate of this program, and she will have valuable feedback on the effectiveness of the program. These interviews will be confidential, and not recorded. They will be transcribed by one of a team of two interviewers, with one person asking the questions and the other person writing down responses. It will also be semi-structured since the director will have much to offer based on her unique perspective. These interviews will also be conducted at the 3 month and 9 month points, for about 1-2 hours.
B. Other Sources of Evidence
The following sources of evidence will be other ways to triangulate and capture data. These methods of data collection will provide valuable insights into the reception of the new program.
Annual report
In the next annual report, a description of the socially responsible wage and benefit program will be outlined. By that point, there will be sufficient data to report on the effectiveness of the program.
Newspaper clippings
The public relations and marketing department of CheapMart have arranged for Brian Cheap, the CEO of CheapMart, to give a series of interviews for the Long Island Times daily newspaper. One of the subjects to be discussed will be the socially responsible wage and benefit program.
Website description of new program
The Human Resources department will use the company website, cheapmart.com, as a recruitment tool. Therefore, the program will be fully outlined there. There will be a link to an employment application directly following the description of the program. Candidates will be prompted to give a reason for their interest in becoming a CheapMart employee, one of the reasons will be the socially responsible wage and benefit program.
Employee Referral
Another method of recruitment is an employee referral, whereby an employee will ask a friend, associate, or family member, to apply for employment, based on a positive referral from the employee. Typically, the employee will receive a monetary reward after the person joins the company and has worked there for a period of time. Although there is a monetary incentive, employees are reluctant to refer a friend, associate, or family member to a company where they are not happy.
Employee Events:
The company will hold various company events, such as a holiday party, an employee potluck, and an annual summer picnic. The attendance levels at these events will provide another form of input from the employees.
Exit Interviews:
Exit interviews are conducted when an employee leaves the company for any reason. Therefore, an exit interview is an excellent opportunity to gather additional data on the effectiveness of the program. Exit interviews at this company are semi-structured, purposely, to gather data of both a positive and negative nature. Research questions pertaining to the new program will be included in the exit interview script.
Other Ideas for the Triangulation of Data – Qualitative and Quantitative
In addition to the qualitative methods proposed, a quantitative method, measuring employee turnover and the cost of training a new employee will be examined.
Summation
The Director of HR, herself a recent MBA graduate, has provided a great opportunity to explore how a socially responsible wage and benefit program will be integrated into the culture of CheapMart. Seldom, are research teams given such carte blanche access to the inside workings of a company and its employee groups. By using a qualitative case study approach, the research team will use interviews and other tools to gather data from employees, managers, and the Director of Human Resources. The results of this study will be of interest to various qualitative researchers, including those in Human Resources.
Part Three: Identifying Fallacious and Flawed Arguments in Current Print Media
Electronic 
Ad: Fallacy
Ad: Fallacy
Social responsibility extends also to advertising. However, in this case, an electronic ad uses fallacies to sell its products:
This particular advertisement is for ‘Starbucks Via’, the new addition to the
range of Starbucks coffees. This commercial urges viewers to believe that just
because people who look like their dogs cannot find out the difference between
this new type and the old , it’s possible that you the viewer, may not be able to
know the difference as well.
This commercial is fallacious in nature. The first obvious fallacy it commits is
‘Hasty Generalization’. This fallacy is committed when a person draws a
conclusion about a population or a big group, based on a sample that is not large
enough or not suitable in the least. The example given here is definitely
insufficient and inadequate. The idea of some people who resemble their pets
not knowing the difference does not in any way represent a population or a
whole consumer base in the least.
The second fallacy this ad commits is the ‘Weak Analogy’. This fallacy is
committed when the two things that are being compared aren't really alike in the
relevant respects. The analogy is a weak one, and the argument that relies on it
commits the fallacy of weak analogy. The idea of some pet owners who resemble
their pets adding to the advantage of the new product that Starbucks is
introducing in this ad, has nothing in common with the others watching this
commercial. The comparison is not valid.
Op Ed
Continuing with the topic of social responsibility, these two Op Ed articles deal with the social responsibility of the intellectually and privileged elite. The authors of these articles are two economics professors from prestigious universities and writers of NY Times Op Ed articles.
General Topic:
The general topic addressed in these articles is why the two rival schools of macroeconomics were unable to predict and anticipate the severe economic downturn which came to a head in 2008. The articles show that neither school has offered any truly viable solutions. Most importantly, it highlights that in the field of Economics, the intellectual elite are out of touch with the economic reality of the masses.
Author and opinion piece of the MORE CREDIBLE view:
The more credible article was written by Paul Krugman, a Princeton University Economics professor , who is a regular New York Times op-ed contributor, the 2008 winner of the Nobel Prize in Economics, and a member of the “saltwater” school of macroeconomics. (The terms “saltwater” and “freshwater” economics refer to liberal Keynesian and neo-Keynesian economists from coastal schools such as Princeton, MIT, and Harvard. Whereas, the “freshwater” economists are from non-coastal schools, they are primarily conservative economists from the Chicago school. These two groups are generally mortal intellectual enemies.)
Krugman's article is entitled “How Did Economists Get It So Wrong?, and it appeared in the New York Times on September 6, 2009.
Author and opinion piece of the LESS CREDIBLE view:
This article was written by John Cochrane, a professor at the Chicago school, and a proponent of the “freshwater” school of macroeconomics. The Chicago school is known for its extremely conservative views, as expressed by its most famous proponent, Milton Friedman.
In the LESS CREDIBLE view, John Cochrane is arguing that Paul Krugman has no solutions for the economic crisis, and moreover, Krugman is a heretic who has attacked the economics field as a whole.
Cochrane dismisses out of hand any solution from Keynesian economics (developed as a solution to the last great depression, for that reason), because it is a liberal philosophy. Cochrane is a conservative who typically will not endorse any liberal philosophy under any circumstances (even if it would solve the situation). The solution of the conservative school is to let the “market forces” work.
In addition, Cochrane ridiculously accuses Krugman of not caring about the masses affected by the downturn (as if he does). This ad hominem attack does nothing to strengthen his argument, but highlights the pettiness of intellectual rivalry. There is a bit of paternalism in Krugman's media exposure in that he seems to be everywhere talking to everyone, but his audience is sophisticated enough to understand that he is there advocating for his intellectual views. After all, capitalism in America is a system where someone pulls himself by his boot straps - even if he doesn't have any boots!
Less Credible Conclusion:
Specific reasons LESS CREDIBLE argument is flawed:
There are several reasons why the LESS CREDIBLE argument is flawed:
- The economist attacks Krugman's support of Keynesian economics, but given the current state of economics, there are few other tools to use. On the other hand, his school offers no solution except the economic status quo. His attack is based on his rejection of the liberal roots of Keynesian economics, and not its potential effectiveness
- Cochrane does not challenge, nor blame the field of macroeconomics for its failure to anticipate the economic downturn, but he accuses Krugman of heretical behavior for challenging the entire field of Economics
- He attacks Krugman personally in an ad hominem attack, alleging that Krugman does not care about the masses
- Cochrane appeals to tradition: he offers no solutions, except his discredited “market forces” philosophy which is part of the problem
Other Possible Conclusions(s) provided in MORE CREDIBLE view:
Although Krugman's view is more credible, he like John Maynard Keynes, believes in “fixing capitalism, not destroying it”. The bail-out and stimulus solutions offered by the saltwater school and other government economists is pathetic. The American public is forced to bail-out the rich corporations. The rich corporations are allowed to continue to give out large bonuses, although they have not yet paid back the TARP money they initially borrowed. The stimulus money has done nothing to alleviate the 9.8% (13% in Rhode Island) unemployment rates, a direct indication of the suffering of millions.
Without a doubt, the 21st century American version of capitalism has become predatory and inhuman. Ultimately, capitalism as we know it must be restructured and replaced with a more humanitarian socialistic model, similar to European models. Understandably, Krugman will not be one of these proponents. He is held hostage by the model of economics he has lived with since the 1970's, and the success he has earned under it. He will not rock the boat. He may push the theory to include more safety nets, government programs, and perhaps some bailouts for the masses, but he will never advocate for the total rejection of the capitalist model.
Reasons Provided to Support the Conclusion in MORE CREDIBLE view:
Unstated Assumptions: This is a debate between two highly educated, highly-paid university professors and op-ed contributors who did not lose their jobs in the economic downturn. Neither one can empathize with members of the underclass who are now losing their homes, their 401K’s, their healthcare insurance, and are facing long-term unemployment. For the most part, these two professors have been protected by the umbrella of the Ivy League, since they entered undergraduate school in their teens. The term “ivory tower” explains the myopia of these two out of touch intellectuals .
The fact that one person in this debate would accuse the other of not caring about the masses is ridiculous. Neither one of them cares, and neither one can relate. One need not look further than the results of distribution of income upward and the creation of the have more and have less classes that was the mantra of the previous administration to understand that the capitalists have successfully created two Americas. These men are in the first one.
It can be argued that Krugman, as a saltwater economist, has a bit more compassion for the underclass, the second America. He will advocate for extensions of unemployment benefits, programs that provide relief for homeowners, and government help with Cobra payments, unlike the freshwater school who could not care less.
However, the two schools of macroeconomics, the freshwater and the saltwater schools, now are both discredited because neither school anticipated and predicted the economic downturn, despite all of their fancy models and tools. Although there were economic voices here and there who warned of problems, the major schools were too obsessed with the “beauty of mathematics” to anticipate the suffering of the people who live in a predatory capitalistic system. The underlying issue is that the system is rotten, but these two people represent the status quo. We will not find the solution listening to them. Under no circumstances do they want to undermine the status quo and lose their elevated positions as economic gurus. For too long, economists have been superstars. Although the average American does not even understand the basics of this arcane science, they seem fascinated by those who claim they understand money. After all, money is the god of capitalism.
Social Responsibility to a Team
Finally, members of a team have a social responsibility to other members of a team. Here are some golden rules that students have found helpful in team interactions. Considerate behavior towards all is conducive to a successful team experience.
The Golden Rules of Team Behavior
A team meeting is an extension of your class.
It is important to attend all meetings, since it is your obligation to your fellow team members and a requirement of your class. Example: attendance at team meetings takes precedence over jobs (on campus or off).
If you must be late, let other people know BEFORE the meeting. Do not expect them to call you and remind you during the meeting.
If you are late, do not expect that the meeting will restart to include you. Someone who has attended the meeting from the beginning can fill you in later.
It is your obligation to jot down the time and location of the meeting.
Come to the meeting prepared with WRITTEN NOTES as well as ideas.
Speak in a language that all team members know during the team meeting time. To speak other languages in this context is counterproductive and is disrespectful.
Do not take or make cell phone calls during the team meeting time. In fact, turn off your phones.
Do not email others during the team meetings. If late attendees email before the meeting, then there is no need to remind them by email during the meeting. They are on their way.
Have only one conversation going at a time. Multiple conversations are not conducive to a productive meeting.
Be professional and courteous to all members of the team. The team meeting is not the place to express your personal displeasure with another member.
CONCLUSION
In conclusion, we found out that Corporate Social Responsibility (CSR) as portrayed by the Starbucks’ DVD case study is a global issue. In this case, it affects the company managers, employees, farmers who are the coffee distributors around the world, the governments which are the policy makers, customers who are the consumers, and the public in general. CSR therefore has a world-wide effect socially, economically and affects all of us in one way or another.
Our research will be based on a case study model. The overall research question pertains to the impact of CSR on employees in general. In addition, two specific questions pertain to: (1) what the components of a socially responsible wage and benefit package will be and (2) what will be the effect of a socially responsible wage and benefit package on employee morale.
The proposed methodology for data collection is a semi-structured interview to be conducted on a sample of CheapMart employees and managers at different times, one at 3 months and one at 9 months. Other intended sources of information include: company’s annual reports, newspapers clippings, company’s website, employees’ events and exit interviews for purposes of triangulation. Quantitative (analysis of the cost of employee turnover) data will be combined with qualitative data for triangulation.
In relation to the project, there is a fallacious Starbucks ad that clearly brings to our attention two fallacies. One of them is making hasty generalizations, that is described by insufficient examples or inadequate examples. The other fallacy is a weak analogy that has major dissimilarities that makes comparison misleading.
In addition, the Op Ed articles illustrates the social responsibility of the intellectual and privileged elite to provide guidance and enlightenment to the masses of people who rely on their insights. In the case of the economic downturn of 2008, the elite from various school of macroeconomics were too blinded by their fancy tools and their own myopic beliefs to see what was right in front of them.
Finally, we conclude with the Golden Rules for Team Behavior to remind all of the rules that govern our interactions in a team environment.
APPENDIX A – The History and Background of CheapMart
History of CheapMart
CheapMart, a low-cost retailer similar to Wal-Mart and Costco, has opened up a new store on Long Island, New York. CheapMart had another location in Mississippi, where the employees were paid minimum wage and had no benefits. CheapMart had numerous lawsuits filed against it because the statistics showed that it only promoted males into positions of management over females.
CheapMart implemented no retail safety regulations for crowd control. Last year in the holiday season, a part-time employee was crushed to death trying to control an enthusiastic holiday crowd. Needless to say, employee morale was very low. Even though the unemployment rate was 30% in that area of Mississippi, CheapMart had a high rate of turnover.
In one exit interview, a feisty employee told the Human Resource representative that the reason she was leaving the company was that “slavery had been outlawed by the Thirteenth Amendment”. CheapMart ended up closing that store, and moving its base of operations to Long Island, New York.
Brian Cheap, CEO of CheapMart, asked the C-level managers and directors of CheapMart, for their input on the failure of CheapMart I. He adopted several of the suggestions including one put forward by the Director of Human Resources:
The socially responsible wage and benefit program:
The Director of Human Resources advocated for a socially responsible wage and benefit program which she described as follows:
· Wage level for employees starting at $30k/year
· Health insurance for both full-time and part-time workers
· Life Insurance policy to be paid to a designated beneficiary for each employee
· Tuition reimbursement for classes and the development of an on-site management training program sponsored by a local Community College
· Company policy to promote from within to fill management and other positions
· Retail safety classes to be offered to all employees
As a recent graduate of a local MBA program, the Director has interested Brian Cheap, and the entire staff of CheapMart, in allowing a group of researchers to study the socially responsible wage and benefit program and publish their results
Finally, what is noteworthy in this case is that a socially responsible model from the developing world (Starbucks' wage and benefit program for coffee growers) will be adopted for use in the developed world (CheapMart).
References
Cochrane, John (2009, September 11). How did Paul Krugman get it so wrong?
cochrane-responds-to-paul-krugman-full-text/
Creswell, J. W. (1998). Qualitative inquiry and research design: Choosing among five
Traditions. Thousand Oaks, CA: Sage.
Krugman, Paul (2009, September 2). How did economists get it so wrong? The New
06Economic-t.html?_r=1
Lockwood, Nancy R. (2004). Corporate social responsibility: HR’s leadership role.
HR Magazine. Retrieved from HR Magazine. Retrieved from
http://findarticles.com/p/articles/mi_m3495/is_12_49/ai_n8583189/
McFadzean, F, & McFadzean, E. (2005). Riding the emotional roller-coaster for
improving nursing morale. Journal of Health Organization and Management,
19(4/5), doi: 10.1108/14777260510615378
Myers, M. D. (2009). Qualitative research in business & management. Thousand
Oaks, CA: Sage.
Starbucks (2009, October 4). Starbucks Via Teaser Spot: Pets [Video file]. Video
posted to http://www.youtube.com/watch?v=G5f_VlO68Hs&feature=channel
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