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Topic: Problems of outsourcing: How should Nike react to bad publicity surrounding its labour practices?

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Introduction

Critical Literature Review Topic: Problems of outsourcing: How should Nike react to bad publicity surrounding its labour practices? 1. Literature on the Theoretical Framework: Academic Books and Articles The theories and concepts that will be used in this critical literature review are those concerning organisational outsourcing and the problems that are concerned. These areas are discussed in various academic texts, which can be located by means of electronic subject and title searches of library catalogues. From completing these searches the following academic books have been revealed. A good reference source containing relevant information in this field is Rugman, chapter 3 (p.72) of: Rugman, Alan M, Donald J Lecraw and Laurence D Booth (McGraw-Hill 1985) International Business Other academic literature found through library catalogue searches relevant to the topic: Katz, Donald R. (Holbrook, Adams Media, 1994) Just do it: the Nike spirit in the corporate world Goldman, R and Papson (SAGE, 1998) Nike culture: the sign of the swoosh Shaw, Randy (Berkeley, 1999) Reclaiming America: Nike, clean air, and the new national activism Bonacich, (Edna Berkeley 2000). Behind the label : inequality in the Los Angeles apparel industry Literature by other authors was found when running searches for organisational behaviour: edited by Mike Smith Basingstoke : (Macmillan Education, 1991) Analysing organizational behaviour [edited by] Derek Adam-Smith and Alan Peacock. (Pitman, 1994) Cases in organisational behaviour From the lituratue found all of the information should be accurate and reliable as they are sources of reference and information and not fiction. ...read more.

Middle

For example, last January, trade publisher Penton Media began for the first time to outsource reader service inquiries. Many small and midsize companies outsource to reduce costs or hold down costs of office space or computer equipment. Cost savings alone should not be the only factor driving outsourcing decisions. Delivering quality product and service and bringing in quality people is a critical part of the equation. Magazines large and small find that outsourcing production allows them to take advantage of the latest computer-to-plate technology and improve the look of their magazines. In addition, it alleviates problems brought on by the short shelflife of software and the expense of upgrading equipment. Stephen A Huth. Employee Benefit Plan Review. New York: Nov 1999. Vol. 54, Iss. 5; pg. 18, 6 pgs. Outsourcing appears to have taken hold in employee benefits departments throughout the country, while rising benefits costs and the threat of further increases dominate the concerns of benefits managers themselves. A recent survey also found an increase in salary levels for benefit managers and for supervisory and clerical staff. The most dramatic increases were for benefits managers in companies with 5,000 or more employees. The top concerns of benefits managers include costs, staffing, and difficulties with outsourcing. 3. Company and Market Sector Information from Free Internet Sites. The majority of Information about Nike can be found on free to view websites the only problem with free to view sites is the quality of data may vary and sometimes be poor and which bits are reliable and which bits not. ...read more.

Conclusion

The idea is: if you can make the "cool" guys wear your products, then the rest will follow. Perhaps the only thing that Nike doesn't like to be remembered for is the bad publicity around its labour practices in Asia. Nike has outsourced all of its production to the low wage areas. In 2000, China produced 43 per cent of its footwear; Indonesia 29 per cent; Vietnam 13 per cent; Thailand 12 per cent. NGOs have criticized the poor working conditions in some of its Asian factories. In 1996, such criticism led to Life Magazine publishing a story on Pakistani children stitching Nike's soccer balls. Another famous case occurred in 1997 when a Vietnam factory, owned by a Korean subcontractor, was found to have unsafe working conditions. NGOs in the Western world started campaigns to boycott Nike and demonstrators protested in front of Nike's stores. Allegations of long working hours, bad ventilation, and physical abuse on a mostly young female workforce has tarnished Nike's reputation. Nike's industry dominance was a main reason for its being severely targeted. Many of its competitors were found to have the same labour practices, but were not subjected to the same level of criticism. Nike has a corporate responsibility initiative to improve working conditions in its own factories and to help influence its suppliers. Despite this, the University of Michigan ended use of Nike products in 2001. ...read more.

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