Class Project Overview. In November, 199, I was asked by Benjamin Medea of Global Exchange to provide an analysis of the Dartmouth Business College report on Nike in Vietnam.

10:12 PM 11/14/97 +0100,: re Nike study
Dear David,
I have been away the past two weeks and am not clear on what has happenedwith the Nike/Dartmouth study. Even though they released their preliminarystudy, I don't think the final one is out yet. At least Nike hasn't sentit out--and we're on the list to get it. There has also been mostlysilence from the press on this.

If you wouldn't mind contacting the professor to ask for it, that would begreat. It is Joseph Massey or Eugene Mihaly at the Amos Tuck School ofBusiness at 603-646-3750 (Massey's direct number) or 603-646-2369 or thegeneral number is 603-646-1110. Thanks so much. I'd love to hear what youdiscover.
Best, Medea Benjamin, Global Exchange

I was able to obtain a copy of the report and thought it could be a starting point in an analysis of Nike's organization theory, in practice, in Vietnam, and other countries. This could be contrasted with Reebok or other organizations, which have different practices. The Tuck study can be found at http://www.nikeworkers.com/dartmouth/tblcontents.html

Nike/Reebok Team Project. The Critical Organizational Analysis or "COA" team project will be a document and a series of team presentation reflecting how you "read, comprehend, re-write, and re-act" to Nike/Reebok. Nike uses subcontractors, pays poverty wages, and is renown for its despotic labor process. Reebok, by contrast, while no saint, pays higher wages and manages its own plants in many of the same countries as Nike. Nike is being boycotted by groups around the globe. A recent report trashed Nike. The author, Nguyen said (March 27, 1997):

• about 35,000 workers at five Vietnamese plants - more than 90 percent of them young women - put in 12-hour days making Nike shoes. Though labor costs amount to less than $2 a pair, the shoes retail for up to $180 in the United States. The Vietnamese workers earn $2.40 a day - only slightly more than the $2 or so it costs to buy three meals a day, said Nguyen, a 33-year-old investment banker. "Nike clearly is not controlling its contractors, and the company has known about this for a long time," he said.

Nike is fighting back with press blitzes, hiring two Dartmouth Amos Tuck business professors to whitewash Nike labor practices, and buying off college sports teams across the land. Michael Jordan's $20 million contract is more money than Nike pays all its Vietnam labor. The factory girls' mean monthly wage in Vietnam according to the Amos Tuck report is between $46.35 and $52.38. Assuming 70-hour work weeks, with two days off a month, and 4.3 weeks a month, that is 15 to 17 cents an hour. Of course no one expects Nike to pay U.S. wages in Vietnam, but a living wage seems reasonable enough. The Nguyen and Tuck reports do not agree on what is a living wage. Another report (VLN) states: Nike pays its Asian workers -- mostly women -- on average from about $1.50 per day in Vietnam to about $2.50 per day in China and Indonesia to make footwear, which accounts for about 69 percent of its revenue -- $8.7 billion last year. 35 workers interviewed for the VLW report said it was not possible to live on Nike's wage, which is the equivalent of 47 U.S. dollars per month: The cost of three simple meals per day is $2.10, but employees interviewed earned only about $1.60 a day. All 35 said that rather than being able to earn enough to send money back home to their families in rural areas, they were dependent upon financial support from parents or other relatives to help make ends meet. http://www.parascope.com/articles/0797/nike02.htm

I am also interested in exploring the organization theory implications of the following despotic, inhumane, and environmentally unfriendly practices: Vietnamese workers interviewed by VLW say they are not allowed to use the bathroom more than once in an 8-hour shift and are allowed to drink water only twice per shift. Both the water and the bathrooms are controlled by card or hat systems -- workers must request the card or hat from their supervisor before they are allowed to use the facilities. The VLW report notes that the number of cards or hats are limited to 3 cards for 78-person assembly line and 4 cards for a 300-person line. Violating this rule three times can result in dismissal. VLW report.

The founder and chief executive of Nike, Inc., Philip H. Knight, owns Nike stock valued at $4.5 billion. In many Chinese factories workers are exposed to toxic glue solvents such as benzene, xylene or toluene without protective gear or proper ventilation. These fumes can lead to fatal illnesses over time, although many employers replace the glue-shop workers in these plants before the onset of symptoms.

VLW Report - "Enforced overtime that exceeds the legal maximum, wages that are below the legal minimum, no days off for weeks on end, substantial fines for trivial offenses, corporal punishment and physical abuse are common occurrences." Examples of corporal punishment include workers being hit over the head by their supervisors, having their mouths taped for talking, being forced to stand in the sun or kneel with hands in the air for extended periods, and having to clean the toilet or sweep the factory floor as punishment.

VLW Report - During a March 18, 1997 visit to a Nike facility in Dong Nai, 56 women workers were forced to run around the factory in the heat as punishment for not wearing regulation shoes, causing one woman to faint and eleven others to develop shock symptoms.

VLW Report - Most of the 25,000 workers in "Nike Town," Vietnam are women and children who are paid .20 cents an hour and work 70 hours a week making Nikes in unhealthy environments that reek of glue. Source: http://www.usvetdsp.com/usvet/story24.htm

"There's a girl being born in America and someone will give her a doll and someone will give her a ball and then someone will give her a chance." -- Nike Commercial. "But what chance is Nike giving women workers in Vietnam?" Roberta Baskin of CBS News asks. Summary of CBS News 48 Hours program, October 17, 1996, about Nike in Vietnam. http://www.saigon.com/nike/summary.htm

Labor practices of the 19^th century should no longer be tolerated at the end of the 20^th century, especially by a U.S. corporation that claims the moral high ground, projects a progressive image, and is extremely wealthy. Source: Nike Labor Practices in Vietnam by Vietnam Labor Watch. March 20, 1997

The Entire VLW report is available at http://www.saigon.com/nike/reports/report1.html

It is a common occurrence to have several workers faint from exhaustion, heat and poor nutrition during their shifts. We were told that several workers even coughed up blood before fainting. The medical facilities at the factories we visited were inadequate. The Sam Yang's medical facility is only staffed with two nurses for approximately 6000 employees. There is only one doctor who works for two hours a day, even though this factory operates 20 hours per day.

Nike contractors might also claim that the workers, during the first three months, are considered students receiving a technical or vocational education and therefore can be paid below the minimum wage. We firmly believe that this is just an excuse to squeeze further profits out of these workers. Nike workers are not receiving a formal technical education or vocational training. There are no classroom facilities in the factory and no educational materials are provided to the workers. The proof that Nike factory jobs require no formal training is the fact that Nike factories currently employ workers on the assembly lines who only have a 9^th grade education, and new workers are usually immediately placed on the assembly line after only a few hours of training.

Some VLW Recommendations (You can come up with more):

• Nike should consult with several Vietnamese who are experts in shoe factories and on how to establish better labor practices. Beside Nike factories, we had an opportunity to visit two other shoe factories in Vietnam: Thai Binh and Hiep Hung. Both are Vietnamese companies and both are producing high-quality shoes for Western shoe companies such as Reebok and Fila. The presidents of both of these companies have expressed their willingness to consult with Nike on how to treat its Vietnamese workers. Even though they consider Nike a competitor, both of these managers are willing to help because they want to improve the working conditions of the workers at the Nike factories. Their desire to help is sincere and generous, and we believe that Nike should take them up on their offer.
• Better conditions - For example, in the dormitories of P.T. Nikomas, one of the manufacturers of Nike shoes, "Each room holds a dozen people. Each room has six bunkbeds, packed in so closely there is no room to walk or even stand in the room." Source: http://www.socialequality.com/public_html/iwb5-5/nike.htm
• In June, 1997, a Vietnamese court sentenced a Nike factory supervisor to six months in prison for forcing 56 workers to jog around the plant in the heat of the day. Several workers had fainted. The supervisor was from Taiwan.