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Current Issues in Management

Current Issues in Management

Current Issues in Management

Executive Summary

Inthe recent times, corporate social corporate responsibility has drawn a lot of public attention due to obvious significance for economic and social health of companies and general society. Despite the move to be socially responsible, companies operation are highly affected by globalization. Therefore this report evaluated how Woodlands Family Theme Park’s Corporate Social Responsibility practices against theory and best practice. In addition, this report evaluated how the company are affected by globalization. In the analysis, the report focused on environmental or green practices of the company against the theory of CSR. The report found out the company which adopts CSR enhances its images, save cost of operation and meets the demand of consumers.

Table of Contents

Current Issues in Management 2

Executive Summary 2

1.0 Introduction 4

2.0 Background of the Company 4

of Corporate Social Responsibilities 53.0 Theoretical Review

3.1 Stakeholder theory 6

3.2 Shareholders’ theory 8

94.0 Evaluation of organisation’s environmental CSR green practices

4.1Conservation of Natural Habitats 10

4.2 Air Pollution 11

4.3 Excess Waste 12

4.4 Excess Usage of Water 13

5.0 Evaluate how the organization is or could be affected by one of the other current business issues 13

6.0 Conclusion and Recommendations 15

7.0 References 16

1.0 Introduction

In the popular culture, theme parks have become dominant features world markets (Xiaoxiao 2014, p.238). Since the first theme park, Disneyland was established; several themes have been built of different kinds including educational, family and regional theme parks. However, more opportunities have been discovered in family themes parks as more families prefer these sites as they offer so many fun activities. The opportunity saw the establishment of Woodlands Family Theme Park in 1989 in Devon England (Woodlands Family Theme Park 2016). The company has since grown and attracts both local and international tourists. Milman (2010, p.222) claimed that shown that in 2008 alone, more than 190 million across 30 top themes parks worldwide. According to World Tourism Organization report of 2009, the number is higher compared to global tourist who visited China, Italy, the UK and Spain combined. Despite the aim of Woodlands Family Theme Park to exploit such opportunity and compete with the likes of Disneyland, Knott’s Berry Farm, Magic Kingdom and Six Flags, the company is influenced and affected by various current issues in management particularly globalization. Therefore, this report will review various literatures including books, newspapers, magazines, articles, journals and websites to evaluate Woodlands Family Theme Park Corporate Social Responsibility practices against theory and best practice, and evaluate how they are affected by Globalization.

2.0 Background of the Company

Woodlands Family Theme Park is established all-weather family enjoyment park which was built in 1989 in Devon, England. The theme park is owned by Wendalls Leisure Ltd that owns Wheelgate Park and Twinlakes Theme Park. Woodlands Family Theme Park has a size of 90acres and provides several family attractions including 500 animals, 16 rides, more than 50 birds, golf course, 12 play zones and train ride among others (Woodlands Family Theme Park 2016). The park operates between the month of March and November. The park also holds a special session called Halloscream Week every October. Woodlands Family Theme Park has the best service in the region and was awarded as the “Best Leisure and Tourism Company” during South Devon excellence awards (Woodlands Family Theme Park 2016). According to Woodlands Family Theme Park website, in 2015, the company received over 1 million tourists both local and international increasing its profits by 15 percent over the previous year (Visit Devon 2016). The growth of Woodlands Family Theme Park is attributed to its location and transport facilities. The attractive lifestyle and culture of this area often has draw several industries including tourism. In fact, Visit Devon (2016) claimed that Dartmouth, Devon where Woodlands Family Theme Park is located is regarded as a tourist place or destination. One of the activities which has encouraged tourism in the town “Royal Regatta” which is held every year in August and takes up to three days. The theme park draws some of its customers from this event. As company which is concerned host up to 500 animals and birds in natural environment, customers, researchers, scholars has been very keen on its environment aspect of corporate social responsibility.

3.0 Theoretical Review of Corporate Social Responsibilities

Bartkowiak (2006) defined corporate social responsibility as the form of business self-regulation incorporated into a firm’s business model in which a business controls and make there is an active compliance ethical principles and global norms, and the with law. Proponents of CSR claim that the course supports a positive effect on environment and the stakeholders such as employees, consumers, investors and communities, among others (Fisman, Heal & Nair 2007, p.13). Even though, corporate social responsibility is considered a new concept, it has drawn a lot of public attention in the current times due to obvious significance for economic and social health of companies and general society. Woodlands Family Theme Park as one of the companies that deal in theme park, its efforts in conserving forest and animals has been taken as a way that convincing its customer that its objectives is not just about making profit but also to solve the social problems facing humanity. Keeping various types of birds, animals and plant types in theme park might a form of business but it is also form of corporate social responsibility. In other words, it keeps animals and plant way from human destruction.

However, David and Ramus (2007, p.12) opined that CSR practice of a company does not just encompass protecting plant and animal but also entails how the company uses various elements of animals and plants such as building materials, energy, water and wastes. Baruch, Petrovits and Radhakrishnan (2010, p.184) stated that many businesses today incorporate CSR into their business model as a strategy of attracting and retaining customers. The research has indicated that not all companies which practice CSR mean it. There have various theories which have been put forth about to explain corporate social responsibility more in context of companies which truly believe in the spirit of CSR and ones which do not care about it. According to Jeffer, Bosse and Phillips (2010, p.58) there are two major theories used to explain CSR and they include stakeholder’s theory and shareholder’s theory

3.1 Stakeholder theory

Stakeholder theory is an organizational management concept which is inclined towards ethical and values in corporation management (Linnenluecke & Griffiths 2010, p.359). This theory was put forth by Edward Freeman in his Strategic Management book titled “A Stakeholder Approach” (1984). In standard terms, stakeholder is a group of people who are directly affected by performance of the firm. Stakeholders include owners of the company, employees, customers, government, community, creditors and suppliers. According to Freeman (1984), the theory argues that these people must always involve in decision making because they make the company to exist. Freeman in this book tries to tackle the «Principle of what or who really matters». The stakeholder opinion of approach is an influential theory of the organization, incorporating both the resource-based opinion in addition to the market-based opinion, and adding up a socio-political intensity (Margolis, Elfenbein & Walsh 2007, p.9).

Stakeholder theory thrives in becoming recognized not just in the business ethics discipline but also applied as a major framework in all corporate social responsibility practices (Freeman 1984). The moral value and ethics described in the book explained company operate within the society hence there are certain terms which it has deal with. Besides, Bartkowiak (2006, p.136) providing the usually needs which are product and service, customer and society expect the company to operate in fairness and observe ethics. In this context, fairness and ethics entails prices, culture and environment conservation. For instance, a company that plants trees to conserve and mitigate climate change could be regarded to take action in the best interest of stakeholders.

Brian, Singhal and Subramanian (2010, p.433) argued that based on resource based view, stakeholder theory holds that companies need to use resources available not only to create value in product or service they offer, but should also use the resource to resolve social problems affecting society. The proponents of stakeholders’ theory are of view that firms should be managed and operated for the stakeholder’s benefits in order to attract them to buy products and service to sustain the survival of the company. Linnenluecke and Griffiths (2010, p.359) posited that the proponent also thinks that even though managers are agents of the owners they are part of the stakeholders and understand what affects the society. Therefore, they should use their discretion to mobilize resources to help improve the social lives of the society. In this way, the manager will be giving the company the human face to the capitalism as argued by Freeman (Freeman 1984). However, Social responsibility is not an obligatory issue and companies are not forced to participate. By being socially accountable, they allow themselves to expand support of the consumer respect, employee’s loyalty and society.

3.2 Shareholders’ theory

Shareholders are another theory which can be used to explain the concept of CSR. Despite being supported by some businessmen, researcher and scholar, the shareholder’s theory leads towards the opposing view of corporation social responsibility. Apparently, this has been traditional view of doing business in the early years. Adopted by Milton Friedman in The piece titled ‘The social responsibility of business is to increase its profits’, the economist looks at shareholders as economic drive of any company and the sole group that the company ought to be socially responsible. In this article (1970) he say that «There is only one social responsibility of business, which is to employ its resources and take part in activities created to enhance its profits provided that it remains within the rules of the game, that is, to engage in clear and free competition with no fraud or deception (Friedman 1970). Jeffer, Bosse & Phillips (2010, p.60) contended that Friedman was trying to demystify the idea, beginning to gain grip at the moment, that organizations and their managers encompass a responsibility to take action increasing social welfare, irrespective of the law on the matter at hand whether that matter be discrimination and pollution.

In this article, Friedman referred businessmen who supported the concept of corporate social responsibility as ‘unwitting puppets of the rational forces that have been destabilizing the foundation of a free society’ and blamed them of ‘preaching pure and unadulterated socialism’ (Friedman, 1970). His claim is, basically, that managers of the organization are the workers of the shareholders and, per se, have a ‘fiduciary duty to increase the profits. He argues that offering money to social causes or charity (apart from as public relations intended to increase business) and being engaged in community projects that do not maximize the corporation’s profit is similar to robbing from the shareholders. In addition, Cummings and Doh (2000, p.94) argued that there is no grounds to presume that a business or its executives hold any special knowledge or skill in the sphere of public guiding principle, and therefore they are going too far of their capability over and above violating their responsibilities when they engage in community events at managers and not individuals agents. Some of the misleading notion employed in such reasoning is resulting from the narrow ‘profit-minded’ opinion of business and the particularly critical and out of reach one-dimensional portrayal of the shareholder (Holcomb, Okumus & Bilgihan 2010, p.321).

4.0 Evaluation of organisation’s environmental CSR green practices

As stated earlier, Woodlands Family Theme Park has been under scrutiny to see it really takes corporate responsibly. While there are areas that the company has done well, there are also numerous areas of green practices that it has failed massively. Some observers claim that the failure of the company could have been affected by globalization. In where the company has failed, it has strongly been criticized for neglect of ethics and corporate responsibilities. People claimed that Woodlands Family Theme Park has allowed fiscal imperatives to triumph over company and societal value of ethical behavior and social responsibility as the company strives to reduce costs of operation and uncertainty.

Holcomb, Okumus and Bilgihan (2010, p.317) stated that even though research has increased tremendously in this field, there are still limited studies in CSR actions of the hospitality market players like theme parks. Despite the state of CSR in tourism industry, Woodlands Family Theme Park has done better in its endeavors to promote environmental and green practices. Woodlands Family Theme Park have strong invested in the conservation of natural habitats, reduction of air pollution, construction of green buildings, management of waste products and conservation of water among others (Woodlands Family Theme Park 2016).

4.1Conservation of Natural Habitats

Irrespective of location of theme park, its impact to environment can severe. Holcomb, Okumus and Bilgihan (2010, p.320) established that majority of the theme parks are normally built in large tracts of land away from urban center where developers have to clear tree and forest, and level the land to make a space for the structure. This process normally leaves different species of animals and birds with no natural habit which they call homes. As a process some animals die while other goes into extinction. In addition, the process of clearing land leads to loss of natural beauty of land which encompasses trees. The situation leads to climate change which can be heavy rains and heavy temperatures which can cause floods, destruction of properties and diseases (David & Ramus 2007, p.10).

However, the management and owner of Woodlands Family Theme Park understand these situations which can a company its reputation. Instead, the company just cleared just a small area and retained wide area for natural habit which they used to host 500 animals and more than 50 birds (Woodlands Family Theme Park 2016). The strategy is a sign that the company value green practice and its contribution to human course. Furthermore, the company also employs green practice by planting some trees to conserve the environment. Natural environment is value to humanity which is also forms Woodlands Family Theme Park’s customer. Natural environment protect them from floods, climate change, rich history and some communities trees are used for medicinal purposes. The green practice of Woodlands Family Theme Park is backed by the socioeconomic view of CSR.

According to Baruch, Petrovits and Radhakrishnan (2010, p.187) the socioeconomic view holds that social responsibility ought to go further than just increasing profits to encompass improving and protecting welfare of the society. The proponent of these view like Edward Freeman contend that the company hold the duty to the society to promote eliminate social issues which affect the large society. Natural habit conservation is one of such duties. Additionally, Fisman, Heal & Nair (2007, p.78) contended that when companies hold high sense of CSR, they take great account on of what their operations may results such as social and environmental concerns such as pollution and general degradation.

4.2 Air Pollution

A research has found that theme park often contributes indirectly contribute to air pollution (Cornelis 2010, p.265). Many people may not know but pollution at theme parks is contributed the use of energy in running operations. Fossil fuel is often burned to power facilities, light street lamps and cool and heat buildings within the park. Even during transportation of people to the park gasoline is burned creating excess carbon II oxide which is emitted into the atmosphere. However, through green practices, Woodlands Family Theme Park has tried to minimize processes which pollute the air. One of such process is by constructing green buildings using renewable materials (Woodlands Family Theme Park 2016).

In addition, the building uses solar, wind, biomass for lighting, cooling and operation of the theme park. These sources of energy are considered clean and do not pollute the environment. The little the company has done is worth noticing in endeavors to promote a clean and pollution-free environment. The efforts of the company have been prompted by environment awareness created by declaration such as the Kyoto and Copenhagen protocol (Ellabban, Abu-Rub & Blaabjerg 2014, p.750). As result, consumer now wants to associate with business which highly promotes green practices and environmental conservation. The argument is that customers makes the business survive hence business must also play part in the social welfare of humanity.

4.3 Excess Waste

Themes packs normally produce large amount of waste products as several people converge and consume different products (Sloan, Legrand & Chen 2009, p.59). Waste product in theme parks can be inform of paper bags, papers, food left-over and plastic cans among other. Accumulated waste product generates landfills which decompose and emits methane or other green house gases into the air. Sloan, Legrand and Chen (2009) opined that to address this concern theme parks normally require having a proper recycling program and system. As company which draws a large number of crowds every day, Woodlands Family Theme Park faces the problem of waste management.

However, the company has used various measures to address this problem. The company uses recyclable paper bags to pack and plates to pack food to its customers within the park (Woodlands Family Theme Park 2016). Woodlands Family Theme Park also informs its customers to throw into bins for recycling instead if littering them everywhere. Participation in various greening initiative has been another approach used by Woodlands Family Theme Park to create conservation awareness. For instance, in 2012, Woodlands Family Theme Park announced its partnership with Coca-Coca which aimed at adding 300 bins to the park to collect wastes and put them in one place for recycling (Woodlands Family Theme Park 2016). To some extent the practices have reduced excess waste and environmental pollution. However, a lot have to be especially as the company grows in terms of size and customer base. In 2013, Woodlands Family Theme Park (2016) claimed that it entered into partnership with the Perth Green in a bid to replace the plastic bags with more biodegradable bags. Management experts argue that when a firm generates industrial waste, the corporate social responsibility view bestows a duty directly to company owners to safely manage the waste.

4.4 Excess Usage of Water

Use of water differs from one theme park. However, Holcomb, Okumus and Bilgihan (2010, p.321) held that water rides or boat rides are often popular service at the parks and requires considerable amount of water for operations. In addition, other areas of operation like cleaning and cooking at the park need a lot of water for operation. However, since there are several people at the park, if not managed properly, the company can have a lot of water going to waste. However, for Woodlands Family Theme Park its green practice has saved the situation as water utilized for boat riding are always recycled to sustain the company’s need for water (Holcomb, Okumus & Bilgihan 2010, p.322). The company also shows its water conservation commitment through planting trees to main the water cycle. Nevertheless, more need to be done to increase green practices.

5.0 Evaluate how the organization is or could be affected by one of the other current business issues

The impact of globalization is increasingly evident on business and on this perspective, tourism and leisure industry. Milman (2010, p.225) claimed that despite significantly growing in the past three decades, theme park management has been significantly affected by globalization. This era has been marked by increasing globalization has companies move across borders to invest in international markets and increase brand awareness and shareholders’ return. However, the operation within the global arena is marred with challenges such as competition, cultural differences and pressure from international markets to be a socially responsible company (Narayan 2015, p.47). In fact, some researchers claim that globalization is the leading factor which affects modern business practice and theories.

Kercher (2006) stated that the fact that companies expands to international markets to increase profits make them loose credibility in regards to corporate social responsibility. The argument makes companies to appear to justify Freidman’s claim that the sole social responsibility of a company is to make profits within the confines of the law (Lenkowsky 2006, p.50). However, the argument is further fuelled by competition in the business markets. A company like Woodlands Family Theme Park is operating in a very competitive market with already established competitors such as Disneyland, Alton Towers, Drayton Manner Theme Park, Thorpe Park, Lightwater Valley and Barry’s Amusements. The increasing competition makes the company to use more funds to expand in the international market rather than mobilizing resource to help is social courses (David & Ramus 2007).

The competition has also been fuelled by capitalism view of business. Since the competition takes place in the market, capitalism view gives produce the freedom to produce and compete in terms of profit. Seldon (2007, p.67) argued that in this view, the company owners are given freedom to accumulate wealthy and majorly concentrate on profits. In addition, Capitalists are allowed to appoint a manager in the global market who acts as an agent has the duty of increasing the returns of the owner. The concentration is purely based on profits since most firms in the market compete on the same basis. Freidman argued that putting money to social causes is against the objective of company owners and actually rob them their returns (Friedman 1970). Capitalism system as classical view believes a company is a private entity and decides what to do with it without listening to the community.

On the other hand, Bartkowiak (2006, p.137) pointed out that cultural belief also affects company’s adoption of corporate social responsibility. CSR is often rooted in the beliefs and culture and some company embrace it because it is an in-thing. However, in culture which believes in capitalism, practicing becomes difficult. Even though Woodlands Family Theme Park is yet to expand, its expansion endeavors can highly affected by countries which does not believe in CSR. Woodlands Family Theme Park is already struggling with CSR since UK is a capitalist nation. Bruce (2009, p.106) argued that the practice is not intensely adopted by most companies particularly the local ones because it is not cultural or emotionally attached to traditions of Britain.

6.0 Conclusion and Recommendations

The report has highlighted opportunity which comes with corporate social responsibility particular with reference to business image and sustainability. Woodlands Family Theme Park has shown its commitment to CSR in various ways like increasing number of bins in the park and using renewable sources of energy to reduce pollution. However, more needs to be done especially on waste management, transport, and water conservation in endeavors. Woodlands Family Theme Park might have been adopting CSR as a way to redeem its image. However, CSR is more than just image as there is more benefit. Hence this report recommends Woodlands Family Theme Park to conduct CSR and green practice for reasons but must also being rational in their profit making.

  • Cost-saving

Using green energy normally save the company from high cost of operation. Renewable energy is natural and saves the company the cost of buying coal and paying electricity bills.

  • Health practices

CSR and green practices reduce health concerns such as asthma which is highly cased by green house gases.

  • Consumer demands

As the environmental awareness increases, consumers now demands for more green goods and services hence competition on now done on this basis.

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