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The company aims to maintain financial profit while taking social responsibility in Laos

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Workers in Laos are arguing for higher wages and lesser influence from the admins.

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1., Reforming the system

To higher the employee satisfaction, we need to reform the whole system to focus more on the welfare part for Laos workers.

We need to discuss more on:

How? Welfare- Specific ideas

2., Collaborating with NGOs

Reliable NGOs make the company credible.

NGOs can help the company create a communication system with locals (probably have more experience with this situation)

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Their wages is too low. According to the professor’s announcement, they are paid 1.4M LAK but in 2023, minimum wage of Laos was 1.3M LAK. Compared to the minimum wage, it is quite low for them. Treatment is important, but increasing wages is more important problem.

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A strife between the company's interest and workers demand has caused a a major issue causing a strike on the behalf of the workers.

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1. Increase Wages and Improve Working Conditions:

Pros:

Reputation: Demonstrates commitment to ethical practices and can improve the company’s global reputation.

Employee Satisfaction: Higher wages and better conditions can reduce turnover and improve worker morale.

Cons:

High Costs: Increased production costs may reduce profit margins, especially if the cost savings from offshoring are eroded.

Disadvantage in competition: May affect the company’s ability to compete on price if costs rise significantly.

2. Find another country to perform offshoring

Pro: Can reduce the cost as HT originally aimed for

Con: Might meet the same issue in the future, and the blame for ethical issues will follow along.

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First, we can increase their wages slightly and give them personalized welfare. For example, we can give workers who have children education fund. It can give them practical support, but it is difficult to satisfy them immediately.

Second, we can help the local society. Laos is a developing country. By paving roads or helping local schools, we can give them long-term interest. Increasing their wages is necessary, too. However, giving them long-term interest is emphasized. It may satisfy workers in the long term. But, it may cost a lot.

Both of the solutions require slight increase of wages.

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Providing better wages and the reformation of the system

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Providing better wages and the reformation of the system

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Reforming the system and raising the wage as a long term investment

Pros:

Expresses concern towards the workers in addition it will be well perceived by the mass causing less backlash

Actually raising the wage of the workers thus conforming to their demands which in turn a better reputation for the general public

Cons:

Still losing profit

No guarantee that it will suffice the workers demand

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Solution: Partenership with NGOs and local orgs

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Solution: Partenership with NGOs and local orgs

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Forming partnerships with NGOs and local organizations.

Pros:

NGOs and local group have a lot of experience with locals and this type of friction with companies.

Collaborating with respected NGOs make the company more credible.

Cons:

Goals of NGOs and local organizations need to align with the company

Relationship and partnership needs effort to be maintained

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The company need to create the active communication system with their labor. And they support them to maintain good environment.

Pros: This system can help them to solve their small problem so their problem can not be stucked.

Cons: The company pay cost to maintain the system.

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1)⭐️Specific Welfare for workers

The minimum wage part:

We are already meeting the minimum wage of Laos = 1.6LAK

BUT we need to higher the wage to make sure that it meets the global and social standard due to the reputations and ethical reasons.

When comparing the wages of high school graduates working in production in Laos, who typically earn 4.2, we are currently only offering 1.7. While 1.7 is above the minimum wage in Laos, it is still unreasonably low in comparison. Therefore, it would be right to raise wages, considering both ethical standards and our reputation.

2) Specific ideas for Reforming the system

The working hours, supervisization

3) Find examples of companies that succeeded and known for their ethical actions which led to company's high profit

4) NGO idea development (Sang Ha)

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What arguments will your team use to persuade the opposing team?

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What arguments will your team use to persuade the opposing team?

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collaborate with NGOs

work on developing the welfare of workers (system)

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2. Are the arguments well-supported by proper evidence?

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2. Are the arguments well-supported by proper evidence?

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NGO:

evidence are the many examples where companies have collaborated with NGOs and had a good outcome: Nike and FLA, H&M and WWF

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3. What are the potential weakness and potential criticisms of your teams' solutions?

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3. What are the potential weakness and potential criticisms of your teams' solutions?

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The opposing team will mainly argue that the ultimate goal of Hankook Textile is to increase profit. Carrying out all the solution we offered will cost a lot, hurting the company's financial situation.

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If the company is ethical more consumers will prefer this company and profits will slowly follow along.

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4. What might be the opposing team's arguments, and solutions? & How will you respond to then?

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4. What might be the opposing team's arguments, and solutions? & How will you respond to then?

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The other team might argue about company's profit loss problem. so we can show that ethical business can be benefit for company in long term.

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5. During negotiations, what are the core objectives and values that your team must uphold?

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5. During negotiations, what are the core objectives and values that your team must uphold?

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Ethics should be more valued than profits

for both the short and long run of the company

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We need to argue that: Ethics > Profits

for both of the short and long run of the company

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6. What are some alternative solutions your team can offer to the opposing team?

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6. What are some alternative solutions your team can offer to the opposing team?

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1. SENDING A SKILLED RESEARCH TEAM INTO LAOS FACTORIES

2. RESHORE PRODUCTION PROCESS BACK TO KOREA

3. PROVIDE COMPENSATION FOR WORKERS

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how would we handle the costs going into the welfare for workers

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Welfare for workers

the other team's first and third solution can be all seen as welfare

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agreed solutions:

welfare for workers

merging both teams' solutions

collaboration with NGO

most likely NOT using

"reshoring back to korea" solution

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are our solutions efficient?

what will the board members say about our solutions?