REVOLUTIONARY CONTENDERS PRESENTS: BRIDGING THE GAP

REVOLUTIONARY CONTENDERS REVOLUTIONARY CONTENDERS IS A TEAM OF: SYED SOHAIL SAJJAD ( ) (LEADER) DANISH SHAIKH ( ) USMAN HAMID ( ) HASSAN SHAHID ( ) M. ZAID TARIQUE ( ) WEB ADRESS:

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP INTRODUCTION: About Company: Malden Mills is a 130 years old. Textile Manufacturer in Lawrence, Massachusetts. Aaron Feuerstein is CEO of Malden Mills. His grandfather had founded the mill and his grandson is currently running the mill with its 3200 employees. BASED ON BRIDGING THE GAP BETWEEN EMPLOYEES AND EMPLOYERS BY CONSIDERING THE CONCEPT OF SOCIAL RESPONSIBILITIES OF A CORPORATION. THE CASE OF THE BOOK IS BASED ON THE CONCEPT OF MOTIVATING EMPLOYEES TO CREATE THEIR INTEREST AND MAKING THEM LOYAL TO THE CORPORATION. THE CASE IS ABOUT THE MANAGERIAL STRATEGIES OF THE CEO OF MALDEN MILLS WHO CONSIDERS EMPLOYESS STAKES AND PUT THEM ON TOP TO GET THE BEST RESULTS FROM HIS EMPLOYEES. WHILE, THE ARTICLE IS ACTUALLY AN INTERVIEW OF FOUR PERSONS RELATED TO DIFFERENT PROFESSIONS AND HOLDS DIFFERENT CONFLICTING VIEWS ABOUT BRIDGING THE GAP BETWEEN EMPLOYEES AND THE EMPLOYERS.

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP SOURCES: CASE: MANAGERIAL CHALLENGE: REBUILDING AT MALDEN MILLS CHAPTER 6: MANAGING PERFOMANCE THROUGH MOTIVATION AND OUTCOMES PAGE NO.: 219 ARTICLE: ARTICLE NAME: BRIDGING THE GAP – PUBLIC BROADCASTING SYSTEMS INTERVIEW COMPANY: PUBLIC BROADCASTING SYSYTEM DATE OF ISSUANCE: MARCH 20, 1996 WEB ADRESS: PEOPLE: MR. AL DUNLAP PAUL SOLMAN (HOST) (CEO OF SCOTT PAPER COMPANY) MR. FEUERSTEIN (CEO OF MALDEN MILLS) PROF. ANDREI SHLEIFER (HARVARD UNIVRSITY) HEIDI HARTMANN (LABOUR ECONOMISTS)

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP CASE OVERVIEW: THE CASE DEFINES THE STRATEGIES OF THE CEO OF MALDEN MILLS THAT HOW HE MOTIVATED HIS EMPLOYEES AND FOCUSED ON THEIR STAKES WHEN HIS MILL WAS BURNT AND HOW HE INVOLVED HIS EMPLOYEES IN THEIR WORK WITH FULL LOYALTY AND REBUILT HIS MILLS IN JUST 21 MONTHS AND INCREASED HIS PRODUCT INTERNATIONAL QUALITY STANDARD FROM 7 TO 2. THE CEO OF MALDEN MILLS CONSIDERS EMPLOYEES STAKES ON HIS FIRST PRIORITY BECAUSE HE BELIEVED THAT EMPLOYEES ARE VALUED ASSETS. THEY ARE THE PEOPLE WHO MAKE THE QUALITY FOR US AND OUR PRODUCTS. BY SHOWING LOYALTY TO THE WORKFORCE, MALDEN MILLS INCREASED THE EMPLOYEES MOTIVATION AND LOYALTY, WHICH IN TURN LED TO HIGHER PERFOMANCE. TO GET ALL THIS, MR. AARON PAID OUT $10 MILLION IN WAGE DURING THE REBUILDING WHICH HELPED NOT ONLY EMPLOYEES BUT TO THE WHOLE COMMUNITY. HE CONSIDERED IT AS MORE THAN THE SOCIAL RESPONSIBILITY. HE CONSIDERED IT AS HIS PERSONAL BUSINESS TO SEE LOYALTY AND GOODWILL AMONG HIS PEOPLE. THE EMPLOYEES FELT THAT THEIR EFFORTS WERE APPRECIATED; THEIR LONG TERM LOYALTY AND PERFOMANCE LED TO THE DESIRED EQUITABLE OUTCOMES AND THEY WERE REWARDED BY KEEPING THEIR JOBS.

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP ARTICLE OVERVIEW: MR. DUNLUP OPINIONS: KNOWN FOR HIS TURNAROUND AT SCOTT PAPER WHICH ENTAILED LAYING OFF THOUSANDS OF PEOPLE. HE DIDNT CONSIDER ANY SOCIAL RESPONSIBILTY. HE ONLY CONSIDER HIS RESPONSIBILITY TO MAKE MONEY FOR HIS SHAREHOLDERS, WHICH IS A THE PRIME OBJECTIVE OF MOST OF THE COMPANIES. HE THINKS THAT BUSINESS IS NOT A SOCIAL EXPERIMENT AS SOCIALISM IS FAILED IN ALL OVER THE WORLD. HE THINKS THAT A CORPORATION THAT MAKES PROFITS FOR ITS SHAREHOLDERS WILL, IN FACT, HAVE THE BEST PRODUCT, THE BEST FACILITIES, AND THE BEST PEOPLE. HE DECLARED RESTRUCTURING CREATES BEST MANAGEMENT, BEST PRODUCTS, BEST FACILITIES AND THE BEST BALANCE SHEET WHICH WILL DOUBLE THE PROFITS OF SHAREHOLDERS AND $250 MILLIONS SHARES OF EMPLYEES WHICH WILL BENEFIT TO BOTH SHAREHOLDERS AND EMPLOYEES. HE THINKS THAT HIS WORKERS ARE DEVOTED BECAUSE EVERY PERSON STOOD THE CHANCE OF LOOSING HIS JOB WHICH WILL COMPEL THEM TO WORK HARD DUE TO THIS SCARY STRATEGY. SO, HE IS HAPPY THAT HE GETS PROGRESS WITHOUTB A SINGLE LABOR INTERRUPTION OR A SINGLE GRIEVANCE.

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP HE THINKS THAT THERE IS A LEGITIMATE NECESSARY DOWNSIZING AS A RESULT OF COMPUTERIZATION AND BETTER MACHINERY. TECHNOLOGICAL ADVANCEMENT REQUIRES THE REDUCTION OF PEOPLE. HE WANT THAT WITH THEIR PROGRESS HE COMPENSATE HIS EMPLOYEES SATISFACTION THROUGH HIGHER WAGES THAN AN AVERAGE MILL. HE CONCENTRATE ON WHERE THE REAL PROFIT IS IN MAKING THE PRODUCT BETTER. QUICK INTRO.: NAME: MR. AL DUNLUP STATUS: CEO OF SCOTT PAPER COMPANY NATURE: SHARE HOLDERS FRIENDLY ATTITUDE & EMPLOYYES AGGRESSIVE ATTITUDE

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP ARTICLE OVERVIEW: MR. AARON FEUERSTEIN: HE CONSIDERS SOCIAL RESPONSIBILITY AS TO TAKE CARE OF WORKERS BOTH WHITE COLLAR AND BLUE COLLAR, AS WELL AS HE HAS A RESPONSIBILITY TO HIS COMMUNITY AND THE CITY AS WELL AS HIS SHAREHOLDERS. HE HAS TO BE WISE ENOUGH TO BALANCE OUT THESE VARIOUS RESPONSIBILITIES AND TO JUSTIFY THEM. HE THINKS THAT ALTHOUGH IT COST THE SHAREHOLDERS, BUT THE QUALITY AND EFFICIENCY THAT WE GET IN OUR FACTORIES IS CRITICAL TO THE HEALTH OF OUR COMPANY. HE CONSIDERED EMPLOYEES AS A VALUEABLE ASSTS AND CONSIDERS EMPLOYESS STAKES AND PUT THEM ON TOP TO GET THE BEST RESULTS FROM HIS EMPLOYEES. HE THINKS THAT IT IS UNCONCIOUSABLE THAT AT THE VERY TIME IT IS YOU HAVE SO MUCH SUFFERINGS AMONGST THE WORKERS AS A DIRECT RESULT OF THE DOWNSIZING THAT THE CEO WOULD TAKE SO MANY TIMES MORE THAN EVER WAS HEARD BEFORE. HE DECLARED THAT THE TECHNOLOGICAL DOWNSIZING IS A THING WHICH WE HAVE TO DO TBUT THERE ARE OTHER TYPES OF DOWNSIZING ALSO WHICH SHOULD BE AVOIDED DUE TO EMPLOYERS STAKE.

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP THEIR TYPES ARE AS FOLLOWS: 1) There's the downsizing where you close up one company and you open up in a foreign country at, at very low rates. 2) There's the business of outsourcing, contracting downsizing, where you get rid of your own workers and you hire in contractors at half the pay. ACCORDING TO HIS THINKING EMPLOYEES UNDERSTAND TECHNOLOGICAL DOWNSIZING ONLY BUT THEY DONT UNDERSTAND OTHER TYPES OF DOWNSIZING. SO, BY PRACTICING OTHER TYPES OF DOWNSIZING, IT WILL HURT THEIR FEELINGS AND SPIRIT AS WELL AS SPOIL THEIR COUNTRY IMAGE IN FRONT OF THEM AND THEY WILL TRY TO UTILIZE THEIR STRENGTHS IN FORGEIN COUNTRIES. QUICK INTRO.: NAME: MR. AARON FEUERSTEIN STATUS: CEO OF MALDEN MILLS (A MASSACHUSSETTS TEXTILE MILLS) NATURE: EMPLOYEES FRIENDLY ATTITUDE

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP HEIDI HARTMANN: (LABOR ECONOMISTS): ACCORDING TO HER THINKING, IT WASNT NOT ONLY THE MATTER OF DOWNSIZING ONLY, IT WAS ALSO THE FALL IN REAL INCOMES OR REAL WAGES WHICH HAS BEEN FALLING DOWN FOR BOTH MEN AND WOMEN EMPLOYEES. SHE THINKS THAT THE FAMILIES WHICH ARE AT THE BOTTOM OF INCOME ARE INSECURE BECAUSE THEY MAY BE LAIDOFF BECAUSE THEY SEE THAT THEIR REAL INCOMES ARE FALLING. SHE DECLARED THAT PEOPLE FEEL THAT THERE IS A CORPORATE RESPONSIBILITY. SHE THINKS THAT ATLEAST 1/3 RD OF HOUSEHOLDS HAVE A DIRECT EXPERIENCE WITH A DIRECT LAYOFFS, EITHER THEIRSELF OR SOMEONE ELSE IN THEIR HOUSEHOLD, AND THATS QUITE A LARGE NUMBER OF HOUSEHOLDS TO BE AFFECTED. SHE DECLARED MR. AARON AS RIGHT ON THE MARK BECAUSE ACCORDING TO HER OPINION WE AS A SOCIETY COLLECTIVELY ALLOW CORPORATIONS TO EXISTS. WE SET THE LEGAL, ECONOMICAL AND POLITICAL FRAMEWORK IN WHICH THEY CAN OPERATE, AND WE HAVE A RIGHT AS A SOCIETY TO DERMAND SOMETHING BACK FROM THEM. SHE THINKS THAT DOWNSIZING SOMETIMES IN THE FAVOR OF TECHNOLOGICAL IMPROVEMENT AND SOMETIMES IT IS FAD AND JUST IN THE FAVOR OF SHAREHOLDERS STAKE. AND SECOND THAT GOVERNMENT ROLE IS TO REALLY TRY TO GET THE BEST BEHAVIOR OUT OF CORPORATIONS IN LONGER RUN INSTEAD OF SHORTER RUN.

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP PROF. ANDREI SHLEFIER: (PROF. OF HARVARD UNIVERSITY) HE THINKS THAT BOTH MR. AARON AND MR. DUNLUP HAVE THE SAME BELIEF. I.E. TO SATSFY SHAREHOLDERS SATKES. BUT THE COMPANIES STRUCTURE AND CULTURE AND THEIR STRATEGIES ARE DIFFERENT. BOTH ARE ACTING COMPLETE RATIONALLY. BOTH ARE HELPING THEIR SHAREHOLDERS AND THE MARKET SYSTEM IS WORKING. HE THINKS THAT THE POINT IS HERE THAT SOME COMPANIES NEED LAYOFFS, AND FOR SOME COMPANIES IT IS IMPORTANT TO KEEP THEIR STAFF. HE CALLED MR. AARONS COMPANY AS INNOVATIVE, LEAN AND COMPANY THAT CAN AFFORD HIS STRATEGIES. BUT HE THINKS THAT NOT ALL COMPOANIES ARE SO MUCH FORTUNATE ALWAYS. HE THINKS THAT THE ESSENCE OF MARKET CONCEPT IS THAT THE COMPANIES THAT DONT NEED ALL THE PEOPLE THEY HAVE CAN LAYOFF ITS EXTRA LABOR AND THOSE WHO DONT HAVE EXTRA LABOR, HE SHOULDNT LAYOFF. QUICK INTRO.: NAME: PROF. ANDREI SHLEFIER STATUS: PROF. OF HARVARD UNIVERSITY OPINION: NEUTRAL OPINION/FREEWILL OPINION.

Brought to you by: REVOLUTIONARY CONTENDERS… Relationship with the article: After a great loss Malden mills faced, The CEO decided to rebuild the Malden Mills because the CEO has great emotions and feelings for his people. He thinks himself as social responsible person to build his country. If he immediately shutdown his business there will be a great unemployment and it also decrease the economy of the country. He expressed himself as patriotic with his country and loyal with his business and people. He didnt consider his employees as rubbish instead he thinks they are valued assets which are not a cutable expense. These are the people who provide us good quality of our products. He motivated his employees by offering a 90 days salary during rebuilding of Mills. Motivation is the state of mind, desire, energy or interest that translates into action. With offering 90 days salary he motivated his employees that he is a caring person who in turn led to higher performance and employees are also loyal with their work and company. BRIDGING THE GAP

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP CONCLUSIONS: Points from Article: Aaron Feuerstiens thoughts are as follows: Take care of the share holders but thats not his exclusive responsibility. He thought his responsibility of his workers both white collar and blue collar. But he is also responsible for his community and his city. He is wise enough to balance out all these responsibilities. He act justly for his share holder as well as for his workers.

Brought to you by: REVOLUTIONARY CONTENDERS… BRIDGING THE GAP CONCLUSIONS: Points from the case: After, Malden mills considerable media attention Aaron Feuerstein met with President Clinton and he showed of his social responsibility. He has capability to adapt according to the situation. He expressed himself as loyal and goodwill among his people. He thinks his employee as a value asset.

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