Thursday, April 22, 2010

Chapter 18

In chapter 18, I felt that I had a real world connection with the “Real World” section. This chapter was all about managing change, the world is changing rapidly and is we don’t keep up with it technologically and socially, we will be left in the dust. This section talks about how Amgen inc. took an unusual approach of asking shareholders what they thought of their compensation plan. It was the first of its kind, a 10 question, online survey which shareholders could participate in. This set trends for other firms in the industry to do the same.
I directly related to this in how John asked his students what they thought of the syllabus, and what changes they would make. In doing this, the students felt like they were valued and respected. No matter how small your roll is, it feels good to be a part of something and to contribute. It also makes the students accountable for their actions when they mess up. Just like it’s easy for you to complain about a president which you didn’t vote for, it’s easy for students to hate a syllabus which was thrown at them. However, if the students write the syllabus, there is not much they can complain about.
I did some additional research on shareholder involvement and found that it is now the norm to involve the shareholders to a certain extend. The biggest factor however, is how large the share. Someone who owns .002% of Nike doesn’t have as much say in the direction of the company as Michael Jordan or Tiger Woods. However, there are meeting, conferences and polls that any shareholder can participate in in many companies.


  1. You used a good example. The fact that companies use this type of interaction with shareholders signals a dawn of a new era between business and shareholder relations. This allows for more shareholder input, which can promote a good image for the company to attract more shareholders. Providing ways that shareholders can give feedback about their company allows the company to keep growing and adjust to current situations.

  2. By giving shareholders a chance to voice their opinions and making them feel that they are truly apart of the company, the company better their relationships with consumers and build up their group of brand loyalists. When a company makes people feel they are important and recognized they will value the company a lot more and have a lot more respect for the people that run the business- perhaps to the extent that if something negative happens to the company and their stock price decreases a little, shareholders will not automatically trade in their stock and buy elsewhere.