BA 342 Study Guide EXAM #2 PDF

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BA 342.2,3 JOHNSON

ANNOUNCEMENTS: Continue to participate in the Small Steps Big Wins Project. You need to earn 100 points each week to receive the extra credit. The Corporate Project for the 2:30 section is due on November 13th. ERRATA: None NOTES BEGIN: I. DIVERSITY A. Touching Strangers Photography Video Clip a. The photographer looks for two people who you would not expect to be together because they are diversely (look different and of different statuses). b. The people photographed said it was awkward at first, but then felt comfortable. B. Wally Triplett and Penn State 1. Wally was a black football player for Penn State in 1945 2. The University of Miami stated that they would not play Penn State if Wally was present, the team unanimously voted NOT to play 3. In the Cotton Bowl, SMU also said they would not play if black players were involved. PSU once again said “We are, Penn State” and that they would not play without Wally 4. SMU played anyway and the game ended in a tie C. Diversity and Inclusion Training in the US 1. An increase in diversity leads to an average $42 million value increase in a company 2. Diversity causes higher returns and better than average firm growth 3. Homogeneous vs. heterogeneous groups have much different dynamics D. Why Boys Fail Video Clip 1. Men are being laid off at higher rates and less are enrolled in college. 2. According the Whitmire, there was a “giant oops” 20 or so years ago when schools started to raise standards in primary school concerning verbal skills. a. Since boys develop verbal skills later than girls, they were put behind permanently in other subjects as well and it is very difficult to catch up. 3. Those getting bachelor’s degrees are 60% women and only 40% men. Some colleges are up to 70% women and 30% men. 4. Since there is still only about 20% women enrolled in graduate programs in math, engineering, etc. then to supply future demand, more men need to be working on undergraduate degrees or more women need to be involved in these fields.

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E. Understanding diversity: Personal and Corporate triads 1. The personal triad to understand diversity consists of: a. Social: People care about diversity, but there may be disagreements concerning the issue. b. Emotional: Different people are very passionate about diversity. c. Personal: Everyone has different levels of experiences in life with concerning diversity. 2. The corporate triad to understand diversity consists of: a. Organizational: Corporations need to manage diversity. b. National: Every nation has its own approach (we are looking at it from the US approach). c. Global: Corporations need to implement their nation’s (US) diversity policy across different cultures. II. WHAT IS DIVERSITY? PAST TO PRESENT A. There are two focal points for diversity: 1. Traditional Focus a. The expanded traditional focus (which was race and gender) has the following characteristics: i. Color, disability status, sexual orientation, gender, race, age, national origin, ethnicity, religion 2. Contemporary Focus a. Focuses on all aspects of a person and understanding that person i. Innermost: personality ii. Internal dimensions: gender, race, age, ethnicity, abilities iii. External dimension: educational background, personal habits, recreational habits, parental status, work experience, marital status, appearance, religion, income, geographic location iv. Organizational dimensions: location, function, division/department/group, management status, union affiliation, field, exempt/non-exempt, seniority B. Diversity: (the business definition) creating an environment where we recruit, develop, and leverage the best talent to achieve business goals profitably.

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C. Diversity and Discrimination: US History 1. US race relations can be broken down into three eras. a. Era 1: Slavery i. Mid 1500s-1863 (Emancipation Proclamation- made slaves free but did not give them rights) ii. Approximately 300 years iii. Cotton Gin invented by Eli Whitney in 1793: technology benefits (increased productivity) and side effects (more demand for cotton led to more demand for slaves) b. Era 2: Painful/Slow Change i. 1863-1964 (Civil Rights movement) ii. Approximately 100 years iii. Plessy v. Ferguson (segregation legal): case about railroad cars; it was so supposed to be separate, but “equal,” but was not equal in reality iv. Brown v. Board of Education in 1954: reversed Plessy ruling and made segregation illegal v. Rosa Parks 1955: Rides bus, Civil Rights Movement c. Era 3: Civil rights, Diversity, and Inclusion i. 1964-today ii. Approximately 50-100 years (not finished yet with this era) 2. Diversity began with the Civil Rights Movement in the 1960s. 3. A video was watched about the “Separate but equal” ruling that was later deemed unconstitutional by the Brown vs. Board of Education case. III. EXAM QUESTION Discrimination is defined as? A. Overt/Subtle denial of opportunity B. Institutional method for promotions C. A name for discerning quality D. How society makes judgments E. Why we now have diversity

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ANNOUNCEMENTS: Corporate project for the 2:30 section is due this Thursday (11/13) ERRATA: None NOTES BEGIN: IV. CLASS INTRODUCTION A. 5 Most Powerful Women a. Ginny Rommety – IBM b. Mary Barra – General Motors c. Marilyn Hewson – Lockheed Martin d. Indra Nooyi – Pepsi Co. e. Ellen Kullman – Dupont B. Professional Development Tip 1. You need to become more “the company” 2. Lead an interview with how you fit the job description V. DIVERSITY A. Federal Laws Prohibiting Job Discrimination (Read in textbook): nothing was really “fixed” a. Title VII of the Civil Rights Act 1964 b. Equal Pay Act of 1963 c. Age Discrimination in Employment Act 1967 d. Title I American with Disabilities Act 1990 e. Section 510 Rehabilitation Act 1973 f. Civil Rights Act of 1991 B. The Equal Employment Opportunity Commission (EEOC) had many charges between 1997 and 2011. The EEOC is responsible for enforcing diversity and equal opportunity laws. 1. Charges involved issues with race, sex, national origin, retaliation, age, and disability. 2. Find the full chart in the PowerPoint slides or in the book. C. Abercrombie & Fitch has had multiple lawsuits concerning their looks policy. 1. This issue really escalated 2003/2004. They paid about 40 million of dollars in lawsuits 2. They only hire young, attractive (“hot blondes”) people and deny opportunity to people who are different. They advertise in a highly sexual way. 3. Students should read about this case in page 708.

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VI. The Diversity Progression: A. Steps 1. Affirmative Action (legal approach) Valuing Differences (training approach) Managing Diversity (business approach) 2. These three things appear in business in this order, and all three are fully, completely in play in business today. B. Affirmative Action- Taking positive steps to hire and promote people from groups previously discriminated against, or underrepresented groups. 1. The Big 3 of affirmative action are: a. Employment: employers must show that their workforce is diverse b. Education: opportunity for education must be provided to all c. Government Contracting: supplier diversity 2. Affirmative action really started to take root with JFK, and when the first major law dealing with affirmative action was passed in 1964. 3. Methodology that affirmative action is reverse discrimination. a. Law: discriminatory against anyone is not cool  have to create a large opportunity for everyone 4. How affirmative action works- steps still used today: a. Create an affirmative action plan. b. Measure and count the results of the plan. c. Create a report which will be audited later. d. Analyze the results of the affirmative action plan. 5. Approaches a. Soft Approach i. Passive nondiscrimination ii. Pure affirmative action b. Hard approach i. Affirmative action with preference hires ii. Hard quotas 6. Disparate Treatment and Disparate Impact a. Disparate treatment- This occurs when an individual, who is part of a protected groups, is singled out and discriminated against. b. Disparate impact- This occurs when a policy is not directly discriminatory but becomes discriminatory through its effects, and it affects a group of people. i. For example, the Griggs vs. Duke Power Company case reached the Supreme Court in 1971. Duke Power required applicants to pass a test that was based on questions that could only be answered if the applicant had a formal education. At the time, significantly less African-American men had high school diplomas and were therefore unqualified because of this test.

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C. Diversity Training 1. Effective- better communication and culture 2. Less Effective- telling someone that they "need to be fixed" D. Managing diversity- A holistic approach creating a corporate environment allowing all people to reach their full potential 1. It addresses both traditional and contemporary issues. 2. Business leverage (using strengths that your business already has) is the key to success. 3. Senior executive engagement is key. VII.

DIVERSITY DATA

A. Diversity data information and meaning: 1. A chart depicting change in the US population between now and 2040 was shown. It specifically showed which categories of races (Blacks, Hispanics, and Asians) will grow the fastest. a. White: 8.7% growth b. Black: 51.7% c. Hispanic: 173.4% d. Asian: 196% e. Total US: 39.6% 2. A chart depicting how the workforce in the US was shown as well. Between now and 2050: a. Percentage of whites goes from 68% to 51% b. Black: 12% to 14% c. Hispanic: 14% to 24% d. Asian: 5% to 8% 3. To employers, getting a share of the talent available is most important, so if some companies start heavily recruiting in new talent areas, other companies will want to catch up. 4. Between now and 2030, the percentage of people that are in the “productive work age” range (25-64) will drop from 52.1% to 47.4% while the amount of retirees grows. a. The ratio of those paying in social security to those receiving benefits will get lower and lower, meaning that us as young people may never receive social security benefits at retirement.

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B. Population maps 1. Census Bureau maps by county were shown comparing population density of different races in the US. The map tells us interesting and troubling things. The statistics below are from 2010. a. Black/African-American: 12.6% of US population, mostly in the south/southeastern, urban areas, and Midwestern industrial cities. i. African Americans generally do not care whether people call them “Black” or “African American,” but to make sure you should ask the individual person. b. Asian: 4.8%, mostly in California, east and west coast port cities. i. Some random counties have a higher population due to universities (Centre County has one of the higher Asian percentages in PA.) c. Hispanic/Latino: 16.5%, mostly in Texas, California (states in between the two), southwestern states, and south Florida. i. By definition, Hispanics are those who come from countries that were once conquered by Spain. It does NOT have to do with race or language spoken. However, the term Hispanic refers to in the U.S. is anyone from Spanish speaking country. d. Native American: 0.9%, in various areas most likely where reservations are. e. White: 63%, densely populated in the northeast. 2. Individuals generally like to live where they grew up. People generally stay or move to one place or location for two reasons: a. Family and friends are there. b. Employment is available – business opportunity VIII. EXAM QUESTION In class we talked about Wally Triplett as the first black football player at Penn State. In the list below select the answer that best captures what we talked about in class? A. Wally’s 1948 team, facing a situation in that year’s Cotton Bowl against SMU, is credited as originating the Penn State cheer, “We are” – “Penn State” B. By the time Wally completed his senior season at Penn State all PSU sports were fully integrated C. After Wally entered Penn State issues of race began to subside for the University D. Sports programs have always used ability and diversity as criteria in recruiting.

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ANNOUNCEMENTS: Please continue to do the Small Steps Extra Credit earning 100 points weekly. ERRATA: None NOTES BEGIN: IX. CLASS INTRODUCTION A. Professional Development Tip 1. If you are considering getting a tattoo or a piercing, make sure to look into company’s image policies 2. It is possible for companies to not hire due to people’s image features X. DIVERSITY & INCLUSION A. Silicon Valley Example 1. Recently, Silicon Valley is being criticized for their diversity or lack thereof 2. They finally began reporting their results a. Reputational issue for not reporting b. Reputational issue for reporting B. Definitions 1. Diversity - creating an environment where we recruit, develop and leverage the best talent to achieve business goals profitably (opens doors). 2. Inclusion - proactively working to insure all employees' cultures are valued so everyone can contribute to their full potential (keeps doors open). 3. Both diversity and inclusion fuel cross cultural competence. XI. Six Business components to diversity A. Ron's Framework (know for exam) 1. Employees (keep and find talent) 2. Customers (demand for a more diverse product or company) 3. Financial performance (minority spending will account for $3 trillion in 2015. 4. Legal 5. Suppliers 6. Must be driven by senior leadership

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B. Employees 1. Components a. Recruitment b. Development c. Retention 2. Companies spend a lot of money every time they lose employees and have to hire new ones. a. Hard turnover costs i. Separation (severance) ii. Vacancy iii. Replacement iv. Training b. Other turnover costs: i. Morale ii. Productivity iii. Relationship 3. Turnover is usually a $10,000 cost per person. There is a six figure turnover cost to replace executives. 4. Johnson and Johnson diversity and inclusion video: a. They are currently ranked #10 for diversity. b. They have a credo c. There is a lot of change coming d. Students should read over the Strategic Diversity/Diversity & Inclusion, and programs web page for Johnson and Johnson and should be able to identify the different programs found in the reading. 5. Employee Resource Groups (ERGs) or Affinity Groups are resource groups within a company. a. 2 Keys of employees: i. Employers – need for talent ii. Employees – need for inclusion C. Customers 1. Components a. Responsibility b. Sales c. New product development 2. Customers example: The Business Case - Frito Lay a. When creating new guacamole chips, Frito Lay utilized its Hispanic Employee Resource Group/Infinity group to create an overall more successful product than what would have originally been created. Within the first year, it generated over 100 million dollars.

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D. Financials 1. Components a. Buying power (in minority group) b. Financial performance c. Global markets 2. 2 Keys from customers a. Our employees help us understand customers better b. Our customers want to buy from a company that demonstrates they understand diversity 3. Financial example: The Business Case a. 3 keys of the financial component: i. Economy and population ii. Purchasing power iii. Stock performance (outperforming market substantially) b. Total minority buying power in 2015 is expected to be $3,475 billion. c. The selling center is in multicultural economy.

E. Legal 1. Components a. Lawsuits b. Public image c. Morale 2. *See chart on page 218 of the EEOC charges from 1997 to 2011. 3. Companies focus on calculating the need for a good reputation. 4. 2 keys of legal: a. Gain positive reputation b. Avoid negative actions 5. Campbell's and Women video a. Reputation is external while morale is internal. Engaging women more increases overall morale. b. Customers feel more connected (80% of customers are women). c. Shareholder returns increase. d. A diversity score card is used as a form of measurement. e. Male engagement has increased. f. Women working in community, workplace, and marketplace is critical for Campbell Soup. 6. Be sure to look at the Xerox website for the big categories of the awards

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F. Suppliers 1. Components a. Sourcing b. Government regulation c. Global 2. Minority business: over 2 million minority owned firms which generate $225 billion in annual sales. 3. Companies should be taking notice of their OEM’s (original equipment manufacturers) G. Senior Leadership 1. Components a. Vision b. Resources c. Accountability 2. Fortune 100 Statistics on Senior Diversity Leader a. 2006 – 46% b. 2012 – 98% c. 30% have CDO positions 3. Watch the IBM diversity and inclusion video (not shown in class; leadership is a huge part of this video). H. Look through the slides and make note of some of the trends within the data. In each part of the framework, Professor Johnson provides statistics to go along with it. XII.

EXAM QUESTION

What is minority Buying Power in the United States (trillions)? A. $3.5 B. $1.2 C. $5.6 D. $7.4 E. $2.1

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ANNOUNCEMENTS: Please continue to do the Small Steps Extra Credit earning 100 points...