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Facing Conflicts

Published October 19, 2015 by Mayrbear's Lair

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Are you, like many others, frustrated and tired of finding solutions to manage various conflicts, then discover you must face them again, repeatedly? That question was the inspiration for this week’s posts as we take a closer look into the nature of conflicts and how effective leaders are able to come up successful resolutions. In our research work, we will also examine whether a model exists that can yield more effective methods for achieving positives outcomes that are in alignment with reaching organizational goals; regardless of whether they are new challenges or the same ones that are recycled over and over again.

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To begin our analysis, we must first acknowledge that today’s global marketplace is multifaceted and culturally diverse. The atmosphere consists of people from assorted backgrounds and belief systems that come together in a work environment. It’s only natural that conflicts will arise when issues develop due to personalities that clash over a variety of reasons including: (a) ethnocentrism, (b) lack of trust between parties, (c) breakdown of communication systems, (d) workplace bullying, (e) interpersonal and intrapersonal conflicts, (f) ethical incompetence, and (g) lack of emotional intelligence, to name a few.

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In addition, conflict in a work arena also prevents workers from experiencing job satisfaction. In his book, Personal Conflict, Daniel Dana (2001) purports that, “Good decision-making helps to prevent conflict” (p. 2). In other words, leaders who can identify the source and level of a conflict, are in a better position to use this information to address problematic issues effectively and successfully to avoid consequences like employees who lack motivation, the slowing of productivity, and most important, damaging relationships which can ultimately lead to the dissolution of an organization.

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On Wednesday, we continue our discussion by conducting a closer analysis into the nature of a conflict as we cite and examine a few scenarios that helped contribute to the development of problematic issues. In addition, we will also examine how these problems may have been avoided with practices of accountability and transparency from more effective leadership. Until then … keep working on finding positive solutions and stay organized!

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“Conflict can and should be handled constructively; when it is, relationships benefit. Conflict avoidance is *not* the hallmark of a good relationship. On the contrary, it is a symptom of serious problems and of poor communication.”  ― Harriet B. Braiker,

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Coming this winter

For more information on Media Magic, our digital publications, or to purchase any of our accelerated learning Business Life titles, please visit:

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References

Dana, D. (2001). Conflict Resolution (1st ed., p. 2). Madison, WI: CWL Publishing Enterprises.

What’s In The Future?

Published June 1, 2015 by Mayrbear's Lair

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Summer Break Edition:

(Originally Posted Feb 2013)

Future

Whats In the Future?

Some say the future is full of promise. Others predict a dystopia full of uncertainty and threats from the growing number of groups who create markets to embrace this apocalyptic future.  A recent example was witnessed by the focus of attention put on the apocalyptic fervor created from the 2012 Mayan prophecy. Meanwhile, sects of major Christian religions interpret global events like the Japanese earthquake, The Indonesian tsunami, the Gulf Coast oil disaster, and the plethora of weather events, including hurricanes, tornadoes, droughts and other natural disasters as confirmation of the forthcoming Armageddon. However research from the late Zecharia Sitchin  (2007), suggests a different meaning of the word Armageddon. The discovery of an ancient site called Megiddo at the foot of Mount Megiddo (Har – Megiddo in the original Hebrew text), from his scholarly view, points to the expression of Armageddon as a term derived in reference to Har-Megiddo, a place associated with annihilation by those with knowledge of the region’s destructive historic past as a prominent ancient battleground.

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Adding to the end-of-times frenzy, are the many indigenous community elders worldwide who also share similar beliefs in end of time outlooks from a little more optimistic vantage. The native peoples view is representative of a metaphoric death of one age or completion of a cycle; and the birth or beginning of a new one. The future in other words can either be bleak or promising contingent upon an individual’s attitude.

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For example, many anticipated a positive change with the replacement of the Bush administration that left our economy in a total wreck by the historical election of the first black US president, Barack Obama who won the election on the message of change. However according to former Governor Jesse Ventura (2009) upon taking the oath of the oval office in his first term; the only missing person from the old Democratic administration was Robert Byrd (Ventura, 2009).  One perspective views the current administration as a positive change, while another indicates that the only change was the actor in the leadership role, while the other acting agents remained the same.

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Sommers (2012), suggests that the direction of our future is subject to social, economic and environmental disasters that can spring from the following four constant and predictable forces of change: (1) resources, (2) technology, (3) demographics, and (4) governance. Trends can help guide these forces of change in a somewhat predictable manner. What is certain however is that the outcomes are unpredictable (Sommers, 2012). In other words, our future will be shaped from the availability of resources that sustain our population and the technology that helps transform raw materials (e.g., ovens to cook meals). In addition to these assets, is the interaction of demographics in the form of the productiveness of a society, which includes the right combination of age, gender and genetic diversity. These are further required components after resources and technology. How successful a group or society will be is contingent upon how productive they are. The the final aspect to a positive future is the governance that comprises the distribution and management of the group’s assets, resources, technology and people in the rule of law and marketplace. Understanding these concepts and how they interact is the key to help us gage the possibilities of knowing where and how to create a brighter future.

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In conclusion, Harper and Light (2011) offer the following advice to help us adjust to change to better equip ourselves as sculptors and active participants in bettering our future: (a) expect change, (b) understand change, (c) change ourselves and (d) help make a difference in the world by doing our part to be of service (Harper & Leicht, 2011).  These four tips, in addition to a conscious awareness of our connectedness to each other and our environment, are essential elements for shaping the globe into a more harmonious place of existence.

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““If quantum mechanics hasn’t profoundly shocked you, you haven’t understood it yet. Everything we call real is made of things that cannot be regarded as real.” – Niels Bohr, a Danish Physicist

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Great gifts for graduates

For more information on Media Magic, our digital publications, or to purchase any of our accelerated learning Business Life titles, please visit our website at:

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References:

Harper, C., & Leicht, K. (2011). Exploring social change American and the world (6th ed.). Saddle River, NJ: Prentice Hall.

Sitchin, Z. (2007). The end of days: Armageddon and prophecies of the return. New York, NY: Harper Collins Publishers.

Sommers, C. (2012). Think like a futurist. San Francisco, CA: Jossey-Bass.

Ventura, J. (2009). Don’t start the revolution without me (2nd ed.). New York, NY: Skyhorse Publishing.

Message Themes

Published October 30, 2013 by Mayrbear's Lair

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A marketer’s goal is to get a powerful message out to their target audience.  Kennedy (2011) suggests the best ads are built with the most persuasive, compelling, intriguing, fascinating message possible. To construct a super powered marketing message advertisers must assess everything and everyone they are up against that are presenting similar messages because their intent is to deliver a message that trumps all others and puts them in a category of uniqueness (Kennedy, 2011).  The strategy that helps marketers achieve these outcomes is doing their homework to come up with a unique selling proposition (USP) justifying their message against the competition. Incorporating a USP into the message theme of an advertising campaign will help the brand stand out above the others and is more likely to remain a fixture in the memories of consumers.

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Before marketers can start to build a tactical business case for content marketing they have to begin with the concept of innovation.  Baack and Clow (2012) explain that message themes are developed into a campaign to transmit key ideas in marketing campaigns. The use of recurring themes helps make the brand stand out more and is more effective at remaining in consumer memories. The message can incorporate different kinds of strategies that target (a) cognitive, (b) affective, or (c) conative responses to make their ads more appealing (Baack & Clow, 2012). For example, back in the 1990s, the Taster’s Choice Coffee Company created a series of ads that became both popular and memorable (Commercial, 1991). The ad conveyed a simple recurring theme in their message that conveyed that life seemed much better sharing a cup of Taster’s Choice coffee with someone special. The recurring theme that communicated their message was constructed in the form of a series of short dramatic scenes like a mini soap opera. Each time the couple would appear in different circumstances while viewers watched their relationship develop. The action was centered around the theme of sharing a cup of coffee each time viewers tuned in to witness the unique circumstances brought them together in each new ad. This advertising strategy was innovative at the time making this ad campaign a phenomenon in the history of TV commercials. This strategy was met with great success because their target audience was focused on people who were hooked to popular soap opera type shows at the time like Dallas and All My Children. Consumers were eagerly waiting for the next commercial to witness the plot development between the couple that was featured in the ads. Not only did sales boom, the Taster’s Choice brand became a part of pop culture during that time as millions of viewers anticipated each new episode to be a witness to the couple’s blossoming relationship. It was considered one of the most effective marketing campaigns on television at that era because of the emotional chord it struck with viewers. The soap opera message theme that delivered their message in that campaign was the bait that kept luring viewers and put Taster’s Choice in consumer memories for a long time. It’s twenty plus years later and I still remember them!

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References:

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (Fifth ed.). Upper Saddle River, NY: Pearson Education, Inc.

1991 Taster’s Choice Coffee Commercial (1991). [Motion Picture]. USA.

Kennedy, D. (2011). The ultimate marketing plan: Target your audience (Fourth ed.). Avon, MA, USA: Amazon Digital Services, Inc.

Buyer Motivations

Published October 9, 2013 by Mayrbear's Lair

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Marketing experts know that the most effective ways to reach their audience is through a powerful message that evokes a feeling and motivates buyers to take action. Kennedy (2011) suggests that successful advertising campaigns implement strategies that focus on a unique selling proposition (USP). This transpires to explain the company’s position with respect to their competition (Kennedy, 2011). For example, Best Buy states it guarantees the lowest prices. They dare consumers to find a lower price and boldly state they will match it. This is one example of how a company telegraphs a message about their benefits through their promises. This tactic is used to effectively appeal to customers that are interested in saving money. Others, however, use tactics like fear to electrify consumers. For example, Allstate Insurance Company uses images of disastrous events like flooding, theft, and automobile fender benders to instill a message of fear. The message they want to communicate with this strategy is that their brand of insurance can bring them comfort during events of great suffering. Companies that express a USP that evoke strong emotions like fear can use it to their advantage to position their services and goods as the answer that addresses their needs. They focus on rousing consumer feelings from their own experiences of significant life changing events. This is one method corporations can use to build consumer trust.

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Marketing experts that use precision marketing methodologies can cut through the noise and focus on winning consumers as fully engaged advocates. Gallagher and Zoratti (2012) postulate that in today’s society, consumers have made it clear they are in control of the communication they tune into. They are voting with their money and their attention by fast forwarding through commercials, opting out of mailing lists, and blocking their phones to avoid solicitors. Consumers, instead, are spreading the information through social networks by voicing their opinions online, with friends, family, colleagues, and the global internet community. Because of this trend corporations are watching their advertising investments deteriorate. Market research reveals that consumer interests and attention are directly related to the salience of the message they transmit (Gallagher & Zoratti, 2012). In other words, in order to engage consumers that are ignoring them, they are finding new methods to penetrate their barriers by gathering extensive research to find out what is relevant to them and what appeals to them emotionally.

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There are many components that advertising firms use to transmit their messages that target relevant consumers. Baack and Clow (2012) contend there are seven major areas of appeal that help form these messages: (a) fear, (b) humor, (c) sex, (d) music, (e) rationality, (f) emotions, or (g) scarcity. Fear is the top emotion that advertisers implement to get their message out while humor is the second. Even though these emotions are not similar, they can, however, be linked together to convey a powerful message (Baack & Clow, 2012). For instance, a company that wants to send a message to men about a new cologne product, may link many of these characteristics to allure an audience. Old Spice, for example, created a very effective commercial about their cologne combining the components of fear, humor, and sex appeal to get the message out about one of their products. The commercial opens with a beautiful muscular man standing in front of a running shower, clothed in nothing but a towel. Using sex appeal in a humorous situation, the man appeals directly to his audience, looking straight into the camera asking the viewer to compare their mate to him while the images fast forward through a variety of heroic scenes ending with the man mounted on a horse reminiscent of a knight in shining armor. This message uses humor, rationality, fear, and sex appeal to communicate to the audience. The ad clearly conveys that the cologne can make their partner more heroic like the man in the commercial if they use Old Spice. The commercial banks on the man’s sex appeal to attract attention, while the concept of fear is implied to those who do not use the product. This advertising strategy communicates to both women and men. The man’s humor and sex appeal allures those who fantasize about a heroic partner, and the emotion of fear speaks to those who are afraid they are not heroic or attractive enough in the eyes of their partners unless they take some kind of action. Advertising teams that engage in precision marketing methods and focus on their target audience, are in a better position to influence buyer motivations and tend to yield the highest results.

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References:

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (Fifth ed.). Upper Saddle River, NY: Pearson Education, Inc.

Gallagher, L., & Zoratti, S. (2012). Precision marketing: Maximizing revenue through relevance. London, UK: Kogan Page Ltd.

Kennedy, D. (2011). The ultimate marketing plan: Target your audience (Fourth ed.). Avon, MA, USA: Amazon Digital Services, Inc.

Sexual Harassment and Discrimination Laws – Part 2

Published September 25, 2013 by Mayrbear's Lair

Ethics

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Theories

Managers with an awareness of discrimination laws from a variety of vantage points, including ethics, can produce a more successful working environment and avoid lawsuits. Ethical theories help leaders decide what is morally acceptable. Geisler (1989) suggests that ethics can be defined in terms of what the organization deems as morally right and that each company creates its own set of ethical standards (Geisler, 1989). In a business environment, leaders look to their own views of morality and ethics to assist them in the decision making process. However, there are times when a leader is confronted with making a decision and is required to determine whether it is more important for the organization to engage in ethical practices or lawful ones. For example, when a claimant files a sexual harassment charge, they are seeking restitution for the violations they experience. In this situation, employers are obligated to manage both the legal ramifications as well as the ethical ones. In other words, while the proceedings are taking place, the employer must take the necessary steps to allow the justice system to prevail, while employers do what they can to support the individual that is suffering, rather than participate in efforts to isolate and humiliate the plaintiff further.

It is the employer’s responsibility to cultivate a climate that personnel feel safe in. Employees that experience discrimination feel unvalued and inadequate. In addition, employees that are subjected to sexual discrimination and harassment experience more physical and psychological problems. Employers need to protect themselves from these events occurring because victims have the support of the legal system to engage attorneys that will pursue restitution. Seaquist (2012) explains laws concern themselves with issues of right and wrong with the administration of justice. Business leaders should also take into consideration the topics of ethics and morality to help their personnel identify more clearly what is considered acceptable and unacceptable conduct (Seaquist, 2012). For example, business leaders that apply the ethical absolutism theory, accept that there are certain universal parameters that determine what is right and wrong. If stealing is wrong for instance, then it is always considered wrong regardless of the situation. Therefore a business leader that incorporates ethical absolutism will always consider stealing morally wrong. However, if the culture in a business has an open attitude towards sexual harassment and views this behavior as boys just being boys, then in an ethical absolutism environment, sexual harassment is accepted as morally right. Simply put, in an environment where many of the employees in upper management are engaged in extramarital affairs, these executives tend to hire employees that embrace the same attitude, or have a disposition in which they are happy to look the other way, or go with the flow, when it comes to ethical misconduct. Not only are personnel conditioned to accept this behavior, many in fact subscribe that there is nothing morally wrong with it. Corporations that cultivate a culture of religious fundamentalism on the other hand, base their code of ethics on scriptures written by prophets and would most likely reject a concept like this.  It is highly probable that they would view sexual discrimination and harassment as a sin and morally incomprehensible.

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Culture

American culture is slowly emerging from a patriarchal society that supported the male sexual dominance of women and employers that control their workers. For example, many corporate department heads from a former place of employment, hired assistants that were physically attractive with an uninhibited free spirit and disposition. Furthermore, they supported an environment that consisted of an open flirtatious atmosphere established by the leaders with various incentives like compensation, pay raises, promotions, free merchandise, or tickets and backstage passes to special events, the use of company limousines, and other similar perks to encourage and support that behavior. Sexual harassment complaints in this kind of culture are typically nonexistent because of the climate that has been cultivated by the supervisors that everyone conforms to, including low level employees.  In other words, they are able to maintain an unethical atmosphere because candidates for hire were only considered and remained as long as they embraced the established culture.

Employers also set the tone of a work environment by the people they hire. Adler’s (2013) research also indicates that many employers have a difficult time hiring and recruiting the best candidates because they are ineffective at implementing strategies to attract top performers (Adler, 2013).  One of the reasons for this is that many leaders have unhealthy perceptions of employee and subordinate roles in the workplace, especially those hired as personal or administrative assistants. Many executives view their assistants for example, as a reflection of themselves and therefore hire staff members that represent of a certain kind of image they deem appropriate for their department. For instance, in a corporate situation, the head of the legal department may hire staff members that adopt a conservative style based on skills and knowledge to represent the group of attorneys that operate that division. The publicity and promotion departments on the other hand, may hire staff members based on artistic and creative skills.  Staff members may consist of  more free spirited people with an open attitude, youthful drive and energy. In other words, the department heads set the atmosphere for the climate and ethical culture they develop and hire staff members that are an organizational fit in that arena.

There is no single law that covers all workers in the US. Walsh (2013) reminds us that employment laws consist of a patchwork of federal, state, and local laws that continue to evolve and are contingent upon many components including the size of the organization (Walsh, 2013). For example, as mentioned previously, many supervisors hire personal assistants based on certain components including, age, appearance, and physical type rather than seek individuals that are qualified with skills and knowledge. In addition, there are many executives that tend to view assistants as their trophy, rather than a skilled person best qualified for the job. This is indicative of a climate where women are perceived as objects, rather than individuals capable of innovation and considerable contribution to an organization’s success. In addition, these females are also viewed and discriminated against by other staff members of the same sex as well. For example, when I was hired as an administrative assistant in the music industry, issues of discrimination immediately began to surface in the corporate arena.  It was evident from the behavior of other staff members of the same gender and equal rank that I was an outsider to them. I later discovered that some of the women even jokingly referred to me as the new dish. In short, other staff members automatically made a judgment based on appearances, not because of my level of skills and knowledge. Rather than embrace and welcome me as a new employee, they engaged in acts of discrimination, making me feel isolated and friendless. In some cases, many employers and employees do not have a clear set of identifying acceptable and unacceptable relationship boundaries. This also fosters unhealthy relationships.

Legalities

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Legal and Political Aspects

Business leaders that understand the legal and political perspective of discrimination issues, are more likely to achieve the best legal outcomes. Palumbo and Wolfson (2011) suggest that patriarchal systems can also influence behavioral patterns that are enforced, legitimized, and perpetuated in a business arena (Palumbo & Wolfson, 2011). These systems can have a significant influence on politics and policy making. For instance, fundamental religion has played a significant role in the world in that many leaders use this position to justify totalitarian actions that are based on absolutist ideals. Leaders in this climate, reveal their ethical principles by the type of legal systems that support them. For example, the civil law system that is common in most of the European Countries (EC) meticulously outlines individual rights and responsibilities. In its quick implementation of justice and with limited power of judicial interpretation, it reinforces an absolutist kind of ethical philosophy with systems that require strict compliance to statutes that guide behavior and leave little room for deviation.

Common law systems, on the other hand, like those established in the US, leave wide latitude for interpretation and provide a multi-faceted frame for the appellate courts to determine (Palumbo & Wolfson, 2011). In other words, civil laws leave little room for misinterpretation, while common law offers latitude for litigants to argue. For example, in a country where civil laws pervade, a sexual harassment issue can be resolved quickly by the laws. In a country where common law systems pervade, both sides of the case must produce substantial evidence to support their position and in many instances, the defense will engage in tactics that degrade, belittle, and present the victim in an unfavorable manner to provide reasonable doubt with respect to a claim. Because of this, many victims do not come forward to avoid the humiliation of such an experience in addition to the violation they are processing and working to recover from.

References:

Adler, L. (2013). The essential guide for hiring and getting hired. Atlanta, GA: Workbench Media.

Chopra, D. (2013, August 16). 21 day meditation challenge: Miraculous relationships. Retrieved August 16, 2103, from chopracentermeditation.com: https://chopracentermeditation.com

Clarkson, K., & Miller, R. (2012). Business law: Text and cases: Legal, ethical, global and corporate environment. Mason, OH: Cengage Learning.

Fredman, S. (2011). Discrimination law. New York, NY: Oxford University Press.

Gordon, L. (2007). The sexual harrassment handbook. Franklin Lakes, NJ: The Career Press, Inc.

Hanh, T. (2012). Work: How to find joy and meaning in each hour of the day. Berkeley, CA: Parallax Press.

MacKinnon, C. (1979). Sexual harrassment of working women. Boston, MA: Yale University.

McGraw, P. (2012). Life code. Los Angeles, CA, USA: Bird Street Books.

Palumbo, C., & Wolfson, B. (2011). The law of sex discrimination (Fourth ed.). Boston, MA: Cengage Learning.

Rassas, L. (2011). Employment law: a guide to hiring, managing, and firing employers and employees. New York, NY: Aspen Publishers.

Seaquist, G. (2012). Business law for managers. San Diego, CA: Bridgepoint Education, Inc.

Walsh, D. (2013). Employment law for human resource practice. Mason, OH: Cengage Learning.

Wilde, S. (1987). Life was never meant to be a struggle. Carlsbad, CA, USA: Hay House, Inc.

Environmental Statutes

Published September 20, 2013 by Mayrbear's Lair

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US legal systems are designed to protect citizens in an organized society with respect to a wide number of issues including criminal behavior, domestic and professional relationships, regulations of industry and business, as well as a multitude of other significant issues. One of the most difficult areas to manage and regulate is environmental law. Schroeder (2008) contends environmental laws are difficult to comprehend because of the complexities involved. Environmental laws are meant to constitute the regulations and actions that threaten or physically harm the natural world including the inhabitants of the environment (people, animals, plants, air, water, and so on). Environmental law is considered one of the most complex areas in the legal field because the laws that regulate the environment are derived from a variety of sources, including: (a) federal courts, (b) Congress, (c) various federal administrative agencies, and (d) international treaties. In addition, state legislatures, courts and administrative agencies, local government (cities, towns, and counties) influence these regulations. Because environmental law is a relatively new field, the involvement of these many entities, makes it difficult to analyze the various statutes and regulations that govern them (Schroeder, 2008). Furthermore, different areas of the law require different knowledge like administrative, criminal, and tort laws, as well as understanding the court system, the civil and criminal procedures, and constitutional laws. Plus, the relationships between these areas are not always easy to comprehend or observe. Finally, science also acts as a major contributor to the plethora of environmental issues. For example, an examination of the maximum contaminant levels for drinking water is one factor that can significantly determine the development and enforcement of environmental statutes and regulations.

environmental law

One environmental law that is relevant to me as a mother and a children’s learning coach, is Executive Order 13045 – The Protection of Children from Environmental Health Risks and Safety Risks 62 FR 19883; April 23, 1997. This environmental law is designed to protect children from the health and safety risks of products or substances that a child is likely to come in contact with or ingest (such as the air we breathe, the food we eat, the water we drink or use, the soil that surrounds us, and the products we use or are exposed to). The EPA’s responsibility is to evaluate the effects of these issues and introduce regulations that provide an explanation as to why the statutes are implemented as well as include information on potentially effective and reasonably feasible alternatives (Summary of executive order 13045 – protection of children from environmental health risks and safety risks, 1997). For example, children in a learning environment typically use and put crayons in their mouths, and some  will even bite into them as an experiment to appease their curiosity about the world that surrounds  them by enlisting the use of their taste pallets. If the crayon is produced from chemicals that are toxic, however, this can present a harmful situation to the children that play with them. This law forces manufacturers to incorporate safer methods, label products with warnings about toxic products, identify those that are non toxic, and punish manufacturers that do not comply. Without these regulations to protect children from harm, parents and teachers cannot feel confident or at ease with the products their children are using if they are not deemed safe indicated by a government agency seal of approval.

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Business leaders for the most part, find dealing with environmental laws taxing. This is due to the complexities that these mandates have evolved into which includes of a system of statutes, regulations, guidelines, requirements, policies, and case-specific judicial and administrative interpretations that address a wide-ranging set of environmental issues and concerns which are created to deal with how humans interact with the environment and ecological systems. However, most business leaders just want to run their business and not have to worry or think about the many regulations they are required to comply with. Ewing and Steinway (2011) postulate that the key issue for business leaders to identify is what role the federal and state government plays in operating their business. For example, the traditional command and control system involves the establishment of environmental standards and permit enforcement procedures, liability assignment, and penalties (criminal and/or noncriminal) for noncompliance. These regulating authorities are granted the power to issue permits or licenses that authorize or prohibit activities that contaminate, harm, or cause pollution. Business leaders must comply with these mandates to operate their business to avoid penalties and fines (Ewing & Steinway, 2011). State groundwater protection laws, for example, provide detailed information that help business leaders better understand the permit programs they may require for their industry. For the most part, environmental laws serve to protect the environment as well as keep us safe from the products we use, protect the air we breathe and make sure the foods we eat are not contaminated. In conclusion, environmental regulations are meant to prevent industries from poisoning and contaminating the environmental and ecological fabric that we all rely on for our existence.

Next week concludes my research on business law with a three part blog that covers sexual harassment and discrimination laws. Until then have a great weekend everyone!

References:

(1997). Summary of executive order 13045 – protection of children from environmental health risks and safety risks. Washington: EPA. Retrieved September 3, 2013, from http://www2.epa.gov/laws-regulations/summary-executive-order-13045-protection-children-environmental-health-risks-and

Ewing, K., & Steinway, D. (2011). Environmental law. Lanham, MD: The Scarecrow Press, Inc.

Schroeder, K. (2008). Environmental law. New York, NY: Delmar Learning.

Antitrust Laws

Published September 6, 2013 by Mayrbear's Lair

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Fair trade and competition is a significant component in how business leaders conduct commerce. Gellhorn and Kovacic (2004) assert that societies have adopted legal systems to control and regulate anti-competitive conduct for several millennia where an antitrust incident documented in Ancient Greece describes a case brought against the grain dealers cartel in Athens in 386 BC (Gellhorn & Kovacic, 2004). By understanding the origins of antitrust statutes authorities are better able to comprehend how to decode them. For this discussion post, we will examine the recent attempted merger of AT&T with the T-Mobile Corporation that was dropped after the Justice Department took an aggressive stance and sued to block the deal contending the merger would constitute a violation of antitrust laws.

antitrust

Antitrust laws are regulated by the federal government to manage anticompetitive practices. Hovenkamp (2011) contends that in order to comprehend antitrust policies, knowledge is required in two rudimentary regions of economics: price theory and industrial organization.  Price theory consists of the decision-making process that determines the quantity and the cost of goods. Industrial organization on the other hand, is the theory of how the framework of the organization and the market are established. In a perfectly competitive market, for instance, all participants have knowledge of price, output and other information. In other words, competitive equilibrium means that all sellers make a standardized product that consumers can purchase at the same price from any outlet. However there are other elements that can affect the market. For instance, supply and demand for products play a role as well. In addition, there are consumers that are willing to pay different amounts. Monopolies, however, create opportunities to increase output and raise profit margins. When profits in a market are high two things happen: (a) companies will produce more, and (b) new companies are formed. This momentum continues until it reaches a point where supply and demand intersect (Hovenkamp, 2011). From that point on, continuation to produce the product increases cost, resulting in too much supply. In addition, revenues decline because of the decrease in demand. Based on this model, the government was justified in believing that the AT&T/T-Mobile merger was a threat to fair competition in the cellular communication market.

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The US government has the authority to exercise its power to protect citizen rights. Merced (2011) reported that if the merger between communication giant AT&T and T-Mobile would have been allowed to occur, it would have created a duopoly between AT&T and Verizon Wireless leaving the two giants to control three-quarters of the cellular communications market (Merced, 2011). This would have ripened the field for the two giants to engage in anticompetitive practices that could have a profound affect on: (a) price manipulation; (b) restriction on the availability of products; and (c) agreements to fix prices that undermine the market. Seaquist (2012) purported that the Sherman Antitrust Act of 1890 which is based on common-law practices integrated with standards of conduct, regulates and punish businesses that engage in anticompetitive practices and was established to prevent mergers like these from occurring (Seaquist, 2012). In fact, just recently, the news reported that the government intervened yet again to stop another merger. This time between American Airlines and US Air, contending that the union would affect higher prices in airfare that would be unfair to citizens. In conclusion, consumers win when Antitrust Laws prevent mergers of large conglomerates because of: (a) higher prices to consumers, (b) they reduce innovative opportunities, and (c) they leave little room for competition. Without antitrust policies, the world would indeed be a very different place today.

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References:

Gellhorn, E., & Kovacic, W. (2004). Antitrust law and economics in a nutshell. St. Paul, MN: West Publishing Co.

Hovenkamp, H. (2011). Black letter outline on antitrust (Fifth ed.). St. Paul, MN: West Publishing.

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