3A. Back to the Opening Case
How does Maria Sobrino symbolize the "new" U.S. workforce? How is this changing the way America does business?

For further information about the interactive annotations in this chapter, visit our Web site (/business/kreitner/management/9e/students/annotations).

Author Notes 3-A: Back to the Opening Case As a Hispanic female, Maria is a perfect example of the changing demographics of America's workforce. Her choice to be entrepreneurial is also more common today than in the past. Finally, she was smart enough to capitalize on a market she knew--the Hispanic community that was already familiar with the gelatin dessert she was selling, and that was being ignored by the larger U.S. organizations that weren't savvy enough to recognize this underserved market.

3B. A Curious Educational System
Craig R. Barrett, CEO, Intel Corp., on the U.S. educational system:

The educational system basically hasn't changed in the past century, and it hasn't recognized that there is international competition. It hasn't really recognized that our university system is popular with graduate students from foreign countries because it's the best university system in the world. More than 50% of the degrees in engineering are granted to foreign nationals. It hasn't recognized that, very methodically and consistently, what you are doing is dumbing down the U.S. citizenry and educating the rest of the globe. It hasn't fully recognized that the standard of living is going to be dependent on the quality of the workforce.

As quoted in "U.S. System Helps Educate the World, yet Fails at Home," USA Today (November 8, 2001): 15A.

Questions: How can a country with a supposedly weak K-through-12 educational system be a world leader in higher education? Do you agree or disagree with Barrett's "dumbing down" claim? What improvements need to be made?

Author Notes 3-B: A Curious Educational System At one time, many of the jobs that currently require a college degree, including teaching, required only a high-school diploma. The change happened after World War II, when the GI Bill encouraged soldiers back from the war to go to college--providing a relief from their attempts to find jobs as well as what looked like untold opportunities. Undergraduate schools, as a result, grew to the point that they are now the cash cows that support the country's excellent graduate programs. As more people graduated from college, less was expected of high school and high-school graduates. Eventually, much of what had been taught in high school moved to the undergraduate level. This problem was made worse by the loss of a large group of intelligent women who at one time had no reasonable career choice but teaching, as they moved into new opportunities thanks to the women's movement. For example, many of today's female college professors would have found themselves at the high-school level in past generations, often because they would be banned from graduate programs, and never hired at the college level. Expectations dropped as classes have gotten larger and more unwieldy. Teachers are expected to discipline with limited options, and parents will sue if a student is expelled, even for cheating. People see education as a right, but have lost sight of the fact that it is a privilege. The problem is getting even worse today, as short-sighted politicians force a testing process to evaluate the success of a school, leading to teachers who focus on having students pass a test rather than develop their capabilities to think, write, and discover. The really sad part of it is, the students are constantly being shortchanged, and they don't know enough to realize it.

3C. Is Race the Issue?
Kenneth Chenault, on being named CEO of American Express Corp.:

From a societal standpoint, it's a big deal; I won't minimize it.... But I want them to say, "He's a terrific CEO," not "He's a terrific black CEO."

As quoted in Nelson D. Schwartz, "What's in the cards for AMEX?" Fortune (January 22, 2001): 60.

Question: What is the real message here?

Author Notes 3-C: Is Race the Issue? Our brains are hard-wired to notice differences. If there are two dozen red roses and one yellow rose in a vase, the first thing our eye will be drawn to is the one yellow rose. However, that difference does not have a judgment attached to it. While you may wonder how the yellow rose got in there, you won't think that the yellow rose didn't earn its place there, or that it is a "token" yellow rose, or that it's a really remarkable yellow rose to be able to be in the vase with all those red roses. However, when it comes to people, skin color often has a judgment attached, even though the actual genetic differences are about as minimal as for those roses. For Chenault, the differentiation could imply many things. The unspoken version of that sentence could be, "He's a terrific CEO, for a black man." Or "Isn't it amazing that an African American could be such a good CEO." Or worst of all, "He never would have made it to that position on his merits alone--it's because he's black," implying that no African American is capable of achieving this level on his own capabilities. When skin color becomes as unimportant a physical characteristic as hair or eye color, then we will have made real progress. How do these sound? "He's a terrific red-headed CEO." "She's a good CEO for someone with hazel eyes." Yes, ridiculous!

3D. A Political Awakening on Campus?
Results of a survey of 281,064 college freshmen at 421 schools:

More U.S. college freshmen are politically liberal or "far left" than at any time since 1975, says an annual survey ... that suggests a rebirth of interest in politics after decades of campus apathy....

Some 30% of freshmen say they're liberals, compared with 21% in 1981. Popularity of the "liberal" label has increased for five consecutive years.... About 49% now are "middle-of-the-road" and 21% "conservative" or "far right."

Marilyn Elias, "Boomer Echo: College Freshmen Look Liberal," USA Today (January 28, 2002): 5D.

Questions: In political terms, what do the labels "conservative" and "liberal" mean to you? Is the shift toward liberal politics among college students a good or bad thing? Why?

Author Notes 3-D: A Political Awakening on Campus? Are you satisfied with the political choices you have? Do you like your congressperson, senators, governor, mayor, or state representatives? Do you know anything about them? How do you feel about political issues such as balancing the budget, abortion, taxes, immigration, or environmental protection? The answers to some of these questions may place you in a category of being "liberal" or "conservative." For many older people, "them's fighting words." Both sides want what's best for the U.S., but have different ways of getting there, as well as different ideas of what "best" looks like. The truth, as always, is probably somewhere in between. Is a larger population of liberal college freshmen a good thing? It is if you're a liberal. I say pick one side if you want, but don't close your ears and your mind to the other.

3E. Give 'til It Hurts!
How executives responded to a survey about why U.S. businesses contribute to political campaigns:

Support electoral process	12%
Promote an ideology	22%
Avoid negative legislation	31%
Buy access for influence	23%
Other	12%

Adapted from "Business of Campaign Contributions," USA Today (November 7, 2000): 1B.

Questions: Are corporate political contributions "good business" or "dirty business"? Explain. What changes, if any, need to be made in the system?

Author Notes 3-E: Give 'til It Hurts Campaigns used to be focused on speeches and debates. This started changing when the now famous anti-Goldwater daisy/mushroom cloud ad severely damaged his run for the presidency. Now, it's hard to imagine a political campaign without heavy advertising. Heavy advertising brings a heavy cost, which leads to the need for substantial donations from both individuals and corporations. Congresspeople know that without full coffers, their campaigns will fail. This means that they have to court the contributors as much as the voters, maybe more. If you add it up, over 75 percent of those corporate contributions were with the hope of getting something back, and I'm not sure I believe the other quarter. I don't like that. It sure looks like dirty business to me. How do you feel about campaign finance reform? I think it would help bring government back to us and campaigns back to issues.

3F. The Economy: Surf's Up! Surf's Down!
James Morgan, long-time CEO of Applied Materials, maker of equipment for computer chip manufacturers:

... problems show up like the rocks in a bay when the tide is out. You can develop a navigation plan. When the water is up, you don't know where the rocks are. Use downturns to find areas that need to be improved. In an upturn you're responding to orders, meeting capacity, getting parts in. That's why when it starts to slow down, things unravel pretty quickly. I'm usually out of sync with the public. I'm focused on the next transition. I've developed the skill of anticipation.

Del Jones, "Use Recession to Plan for Next Level," USA Today (February 1, 2002): 6B.

Question: Why does it take bad economic times to make a truly good manager?

Author Notes 3-F: The Economy: Surf's Up! Surf's Down! In good economic times, any idiot can succeed, even lousy business plans work, and it takes a lot of stupidity to fail. The evidence of this is provided by the recent dot.com boom and bust. Money was literally flying into any organization that had a dot in its name. Suddenly there was a small blip in the economic horizon, and the bubble companies made of nothing but air and words popped. It's easy to succeed when the economy is growing. The question is: Are you good enough to make it when it's not?

3G. Watch Out! Here Come the Cowboy Capitalists
Fortune magazine:

In the Business world, at least, globalization has meant Americanization.

USA Today:

One idea enshrined in MBA curricula is the primacy of shareholder value: Students learn early that, as managers, their top priority will be to maximize value for shareholders.

That smacks of "cowboy capitalism"--hostile takeovers, large-scale layoffs, golden parachutes--to many Europeans. But today, European corporations find themselves in the midst of an unprecedented frenzy of merger activity and cross-border investment as they scramble to stay competitive with their U.S. counterparts.

Janet Guyon, "The American Way," Fortune (November 26, 2001): 114; and James Cox, "U.S. Success Draws Envy, Protests," USA Today (August 3, 2000): 2B.

Question: Are you pleased or displeased with the economic globalization trend? Explain.

Author Notes 3-G: Watch Out! Here Come the Cowboy Capitalists Walk through almost any store today and you'll find products from all over the world. From out-of-season peaches grown in Chile to DVD players manufactured in east Asia, we've grown used to the benefits of drawing our daily purchases from the four corners of the world. Over time, the fact that we can travel to China and still drink a Coke or have a McDonald's hamburger in Tokyo stops being a surprise. And when we move into business and our turbines are South American-made and our bolts come from Cambodia, we don't even notice. I recently heard a rumor that one international altercation was stopped before it became a war by a company that relied on that country's low-cost software programmers to do business. If economic globalization means that we start to notice that we're all in the same boat, I'm all for it.

3H. A Slap Shot: "Disruptive Technologies"
As hockey great Wayne Gretzky used to say, the key to winning is getting first to where the puck is going next. The same could be said about succeeding in business....

The pattern we observed arises out of a key tenet of the concept of "disruptive technologies"--that the pace of technological progress generated by established players inevitably outstrips customers' ability to absorb it, creating opportunity for up-starts to displace incumbents.

Clayton M. Christensen, Michael Raynor, and Matt Verlinden, "Skate to Where the Money Will Be," Harvard Business Review, 79 (November 2001): 73-74.

Questions: What "disruptive" technologies, á la Napster's peer-to-peer music file sharing, do you see on the horizon? In other words, as a businessperson or an investor, what future profits would you skate to today?

Author Notes 3-H: A Slap Shot: "Disruptive Technologies" Sit down with a group of friends and brainstorm three or four aspects of the future--music, the Internet, what Destiny's Child will be doing when they're in their 40's--and hang on to the list. Chances are, in the next 5-10 years, some things on that list--no matter how far out they seem now--will become commonplace. Or sit down with a copy of the Sharper Image catalog and count how many products in there didn't exist when you were a child. It's hard to tell where the "pucks" of the future will go, but one thing for sure--they're moving fast.

3I. Advice for Future Intrapreneurs
Among Gifford Pinchot's ten commandments for intrapreneurs are the following:

• "Come to work each day willing to be fired."
  
  
• "Do any job needed to make your project work, regardless of your job description."
  
  
• "Remember it is easier to ask for forgiveness than for permission."
  
  

Excerpted from Gifford Pinchot III, Intrapreneuring: Why You Don't Have to Leave the Corporation to Become an Entrepreneur (New York: Harper & Row, 1985), 22.

Questions: How can these ideas enhance innovation in large organizations? Is this advice a formula for career success or sudden unemployment?

Author Notes 3-I: Advice for Future Intrapreneurs Innovation in organizations develops in two ways--by hiring people who are willing and able to take risks and be innovative and by providing an environment where that type of person can thrive. Pinchot's advice for successful intrapreneurship is valuable, if your firm supports this type of behavior. But it's a formula for getting fired by change-resistant managers in static bureaucracies. Determining your comfort zone for risk and matching it to the risk requirements of those companies you are considering for employment is one way for you to make sure your job of choice will be a success. If you're not sure how willing you are to "push the envelope" in a work environment--take a look at yourself in the classroom. Are you constantly challenging the perspective of the professor, pointing out a new approach to an issue, and volunteering without knowing what you're going to be asked to do? If so, you are probably more willing to take a risk. If, on the other hand, you write your papers based on what you think the professor wants or expects to hear, comment in class often only to clarify a point or get details for the exam, and tend to pretend to be taking notes whenever volunteers are needed, you may be risk-adverse. Both behaviors have value. Most of the new products on the market stem from people and companies who are willing to take risks. However, do you want a creative and risk-taking CPA managing your company's books? Probably not; just ask former Arthur Andersen clients.