Decision Time
Ben Dooley and Casey Stringer had agreed to stop for coffee in the atrium Starbucks beforeheading up to the 35th floor for a board meeting.“You seem deep in thought,” Ben said, placing the two cups of hot coffee on the table.“Watching Johnna and Robert in previous board meetings helps me to understand why thefolksinCongresscan’t get anything done,” Casey mused. “Both sides have stated their positionsand nothing, nothing will budge them. I dread this meeting. I’d rather have a root canal.”“Well, while the two giants battle it out, the rest of us will have to work out some sortof compromise. We outsourced manufacturing operations to China several years ago to cut
costs and now things are changing rapidly and we have a major decision. Does Bishop’s
Engineered Plastics make the best of the situation in China …?”
“… Or do we re-shore?” Casey added.
“Someone will have to be the voice of reason today,” Ben said. “Robert Ma has over-
seen the outsourcing to China and, initially, it was a great move.”
“I agree the cost savings were pretty amazing. The retooling and creation of a state-
of-the-art factory in Wenzhou by the Chinese really propelled us to a new level within the
industry.”
“Well, 2012 is the Year of the Dragon, and the dragon is having a problem,” Ben
replied.
“Yes, Robert is going to have to face the fact that if we stay in China, we have to
move from Wenzhou,” Casey pointed out. “The worker shortage is bad and getting
worse. The last estimates for that region were one million workers short. As wages go up
and other opportunities present themselves, manufacturing jobs are losing their appeal in
the cities. In our plant the managers have to come down and work on the lines. That’s
not good. Now, to try to stave off a mass industrial exodus, the Chinese are offering a
stimulus to industries to relocate into the interior of the country. The interior offers more
workers and lower wages …”
“And a factory move will delay manufacturing and make shipping even more difficult,”
Ben replied. “Add to that the Chinese insistence on full payment before shipping, and we’re
looking at some potentially serious delays.”
“Johnna, on the other hand, is going to argue that the situation in China is an indica-
tion that now is the perfect time to re-shore—bring the jobs back to the good old U.S. of
A.,” Casey said. “She’s going to dig in her heels on this one and you and I know that at
least two members of that ‘august’ board are going to back off and let her have her way
with no careful analysis of the pros and cons.” I sometimes think Frank is a people pleaser,
always agreeable, especially toward Johnna, because she is the chair. And Martha usually
doesn’t say anything, much less offer an opinion. She stares down at her hands when the
going gets heavy.”
“The pros for Johnna are obvious—bring jobs home when jobs are needed; shorten the
supply line, reduce shipping costs, offer faster response to customers; and, I believe, offer a
better quality product. It is worth a little higher labor cost.”
“And what are the cons?”
“The problems are the higher wages here and the cost of retooling factories in this
country that have been down for a few years.”
“But,” Casey asked, “Would we have to build a new factory deep in China’s interior?
No. And will their interior workforce be adequately trained? I would guess not. The Chinese
government will help with building and relocation costs, but still ….”
“So both Johnna and Robert have a strong argument and some glaring weaknesses. Is
there room in here for a compromise? That’s what I would like to see. They would both get
something,” opined Ben.
“I don’t know. I’m eager to see what each one of them presents. It should be an inter-
esting conversation.”
“Or an afternoon in hell,” Ben said as the two headed for the elevator. “I wonder what
you and I might do to help Johnna and Robert resolve this conflict. What do you think we
should do, Casey?”
QUESTIONS
and Robert? What conflict styles might they adopt for this meeting?
decision?
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