Escolar Documentos
Profissional Documentos
Cultura Documentos
1
Abstract
Title Stakeholder Management Through and Understanding of Union
Perspective
Keywords Labor unions, stakeholder mapping, stakeholder management,
IBM, France, USA
Background and The problem that was initially discovered during data collection
problem was that companies are generally uncomfortable discussing
discussion unions. The question that eventually presented itself is what
gives labor unions means to influence a company? Also, we
provide some definitions to key concepts, and a brief history of
IBM, the American IBM labor union “Alliance@IBM”, and the
French IBM labor unions.
Purpose To provide companies with a better understanding of labor
union’s perspective. This insight can allow for more effective
stakeholder mapping and management of unions.
Research -How can unions be stakeholder mapped?
Questions -What is the factor (or factors) that gives unions the ability to
influence the company?
-What strategies will unions pursue to increase their influence?
Methodology This study is not only based on literature regarding unions, but
also on interviews that helped us gain union perspective.
Therefore, both primary and secondary sources are used, in a
mostly qualitative sense.
Theories We used mostly normative theory pertaining to stakeholder
mapping and management.
Case study and First, we define the objectives of French unions and American
additional unions. Next, the relationship between unions and IBM is
interviews presented. Finally, IBM union’s current status, issues, and means
of action are presented.
Conclusion After pairing the data with the theoretical framework, several
conclusions are drawn. These conclusions include an analysis of
company objectives vs. union objectives, how unions obtain
influence, and how this information can be applied in real world
examples.
2
Acknowledgements
We would first like to express our gratitude to our tutor, Dr. Emeric Solymossy, as
well as Peter Gustavsson and Gunilla Söderberg. Between the three of them, we
5 always received the guidance we required and more.
Professor Richard McAndrew was an invaluable source of inspiration for the thesis
topic, as a teacher and as friend. We would also like to thank Becky Boling for her
contacts provided.
The time granted to us by our interviewees is very much appreciated. Lee Conrad,
10 Jeff Lacher, Rick White, Marcus Courtney, Jean-Claude Arfélix, and Frank Setruk all
contributed invaluably with personal interviews, and we hope this thesis is a
product they are happy to be associated with.
We appreciate the time and effort put in by our reviewers, who pushed us to deliver
the best paper possible.
15 We would finally like to thank our family and friends, who provided the emotional
support we all know is necessary for a project of this magnitude.
Pleasant readings.
20
3
Note to the Reader
In order to avoid word confusion, a system was established for the context of this
paper. Any time the word “union” is stated, the word “labor” is implied. For
instance, “French unions” and “French IBM unions” will be used instead of “French
5 labor unions” and “French IBM labor unions”. The latter is incredibly wordy. In
addition, America/n will always refer to the United States of America, not the
landmass that includes North and South America.
4
Table of Contents
Abstract ........................................................................................................................................ 2
Acknowledgements .................................................................................................................. 3
Note to the Reader .................................................................................................................... 4
5 I. Introduction......................................................................................................................... 7
1. Background .................................................................................................................................. 8
Who is a stakeholder? ..................................................................................................................................8
What is a union?..............................................................................................................................................8
What is Stakeholder Management? ........................................................................................................9
10 What is Stakeholder Mapping? .................................................................................................................9
IBM .......................................................................................................................................................................9
The CWA and Alliance@IBM .................................................................................................................. 10
French IBM Unions ..................................................................................................................................... 12
2. Problem Discussion ................................................................................................................ 14
15 3. Purpose Statement and Research Questions................................................................. 14
4. Relevance ................................................................................................................................... 14
II. Methodology ................................................................................................................... 16
1. Point of Departure .................................................................................................................. 16
2. Philosophical Perspective .................................................................................................... 16
20 3. Choice of Method ..................................................................................................................... 16
4. Data Collection ......................................................................................................................... 17
Primary data.................................................................................................................................................. 17
Interviewees Table ..................................................................................................................................... 18
Secondary data ............................................................................................................................................. 19
25 5. Ethical Considerations........................................................................................................... 19
6. Delimitations ............................................................................................................................ 19
7. Analysis ....................................................................................................................................... 20
III. Theoretical Framework............................................................................................. 21
1. What is a Stakeholder? .......................................................................................................... 21
30 2. Degrees of Influence ............................................................................................................... 21
3. Attributes ................................................................................................................................... 22
Legitimacy ...................................................................................................................................................... 22
Urgency ........................................................................................................................................................... 24
Power ............................................................................................................................................................... 25
35 Influence Strategies .................................................................................................................................... 26
4. Mitchell’s Mapping .................................................................................................................. 28
5. Analysis ....................................................................................................................................... 29
IV. Empirical Data: A Case Study at IBM ..................................................................... 32
1. Unions’ Objectives ................................................................................................................... 32
40 2. Nature of the Relationship Between Unions and IBM ................................................ 34
3. Unions’ Status and Structure ............................................................................................... 38
4. Unions’ Issues ........................................................................................................................... 40
IT and White-collar Membership.......................................................................................................... 40
Alliance@IBM: Organizing Issues......................................................................................................... 42
5
French Unions’ Challenges: An Historical Foundation ................................................................ 44
Unions’ Means of Action ........................................................................................................................... 46
V. Analysis ............................................................................................................................. 52
1. Conflicting Objectives ............................................................................................................ 52
5 2. Influence ..................................................................................................................................... 53
3. Urgency ....................................................................................................................................... 53
4. Legitimacy .................................................................................................................................. 54
5. Power ........................................................................................................................................... 55
6. Application................................................................................................................................. 57
10 Alliance@IBM ............................................................................................................................................... 57
French IBM Unions ..................................................................................................................................... 59
7. Analysis ....................................................................................................................................... 60
Conclusions and Recommendations ............................................................................... 62
Works Cited ............................................................................................................................. 64
15
6
I. Introduction
Stakeholder management is tricky, its definition ambiguous.
It is a moderate paradox of balancing ones own needs with the conflicting needs of
those who affect your survival. It is the attempt to achieve positive relationships
5 with those whose expectations of you may differ from your requirement of them.
Unions are everywhere. Whether you are in Germany, where there is strong
unionism based on a principle of co-decision; in Japan, facing thousands of unions
joined together into federations and federations of federations; or in Sweden, where
there is a union membership rate of over 80% of the working population, unions
10 have found cause to justify their exist in almost every developed country.
However, in countries such as France and American, union numbers are on the
decline. Since the 1970/1980’s, French unions have lost about 2/3 of their
members and today less than 8% of the active population is unionized, which makes
France the European country with the lowest rate of union membership1. America
15 faces the same situation, with union membership dropping from 20.1% in 1983 to
12.4% in 2008.2
But while the status, strength, industry, country, goals, structure, organizing, etc., of
all unions differ, there is at least one commonality between them: they are all
20 stakeholders of the company. Consequently, as diverse as they are, unions can be
managed as stakeholders.
Like any company, IBM must mange its stakeholders, and that includes its unions.
With the decline of French and American labor unions and the rise of computer
science, a study of French IBM unions and the American IBM union seemed ripe for
25 discussion.
1 Dares, 2004
2 USDL, 2009
7
This thesis is intended to provide companies with a better understanding of labor
union’s perspective. This insight can allow for more effective stakeholder mapping
and management of unions.
1. Background
5 It is first necessary to have an understanding of the terms and organizations this
thesis will refer to. This includes stakeholder, stakeholder management,
stakeholder mapping, IBM, the French IBM unions, and the American IBM union.
Who is a stakeholder?
While the definition of a stakeholder varies, a stakeholder will be defined in the
10 context of this thesis by the Freeman definition: “A stakeholder in an organization is
any group or individual who can affect or is affected by the achievement of the
organizations objectives.”3
What is a union?
The simplest way to define a union is to start at a dictionary definition; “an
15 organized association of workers, often in a trade or profession, formed to protect
their further rights and interests.”4 That being stated, does said organization need
to be formal? Within the context of this paper, the answer is yes. Three employees
complaining at the water cooler about longer lunch breaks does not constitute a
union. While these three men are stakeholders, are united, and share a particular
20 interest, they are not organized or “formed to protect their further rights and
interests”. They would need a formal institution to achieve this. The question to ask
is where does this group lie as far as company management is concerned? Is the
company going address the needs of these three water cooler renegades? Probably
not. This paper is more concerned with organizations that companies must actively
25 “manage”. Therefore, this paper will define unions as “a ‘formal’ organized
association of workers, often in a trade or profession, formed to protect their further
rights and interests”.
3 Freeman, 1984
4 “Labor Union”, 2005
8
What is Stakeholder Management?
We know that stakeholder management is the management of stakeholders, and
stakeholders have been defined. But what is management? The definitions of
management are as numerous as the definitions of stakeholder, but as defined by a
5 standard dictionary, management is “the process of dealing with or controlling
things or people.”5 A business dictionary defines management as the “organization
and coordination of the activities of an enterprise in accordance with certain
policies and in achievement of clearly defined objectives.”6 The latter is much
clearer, but in the context of union relations, “clearly defined objectives” are difficult
10 to achieve. What are the objectives a company hopes to achieve in its management
of unions? This thesis sets out to provide companies with a framework for
understanding union objectives, which in turn will clarify company objectives.
IBM
International Business Machines Corporation, or IBM, is an international computer
technology corporation. IBM operates in more than 170 countries and according to
20 2008 measurements, has over 390,000 employees7. In 2008, IBM's revenue was
over $103.6 billion, and net income over 12.3 billion.8 IBM is one of the oldest
computer technology companies still in existence, as it is over 100 years old. It's
significant contributions to computer technology are in both the fields of hardware
and software, and the company also offers other services, such as consulting. IBM's
25 mission statement reads as:
5 “Management”, 2005
6 “Management”, Def. 1
7 IBM, 2008
8 IBM, 2008
9
"At IBM, we strive to lead in the invention, development and manufacture of
the industry's most advanced information technologies, including computer
systems, software, storage systems and microelectronics."
20 Improve the standard of living for our current and future members;
Organize new workers into the union to bring the benefits of collective
bargaining to the unorganized;
Reaffirm our commitment to universal service so that all Americans have
equal access to the information highway;
9 CWA, 2009
10 CWA, 2009
11 CWA, 2009
10
Educate our members to vote in their own best interests and to build
community coalitions at the national and local levels to support workers'
rights.
The CWA was founded in June 1947 by succeeding a very loose federation of
5 telephone unions12, but it was the divestment of the Bell system in 1984 and beyond
that shaped the CWA that exists today. The CWA triangle is the cornerstone of CWA
logic. The sides of the triangle are organizing, community/political action, and
representation, and each factor is dependent on the other two (see below).
13
12 Katz, 2003
13 CWA, 2009
11
members and approximately 5600 subscribers and supporters.14 Alliance@IBM’s
mission statement is as follows:
Unions are currently allowed in France under the Waldeck-Rousseau law22. The
right to join a union and the right to defend one’s rights and interests via unionism
was reaffirmed in the 1946 Constitution’s preamble: “Every man can defend his
20 rights and interests through labor unionism and join the union of its choice23”.
14 Conrad, 2009
15 Alliance@IBM, 2009
16 Charoux and Jeaneau, 2008
17 General Labor Confederation, founded in 1895.
18 French Confederation of Christian Workers, founded in 1919
19 Workers’ Force, founded in 1948
20 French Democratic Labor Confederation, founded in1964
21 Executives’ General Confederation, founded in 1944
22 Waldeck-Rousseau Law.
23 French Const. Preamble
12
French unions are organized on three levels: corporative unions that group workers
from the same trade; unions’ federations, that group unions by industry, and
confederations of unions, that groups together several federations. The corporations
regroup workers from the same trade. They are organized in federations, according
5 to the industry. Those federations are part of a larger organization: the
confederations. Each of the five “representative” unions can decide to create a union
section in the company, no matter how many employees there are. The five major
unions are present at IBM. The CGC has the majority at IBM, with 30% of the
unionized workers belonging to this union. It is followed by the CFDT (17%), the
10 CGT (14%), the FO (8%) and the CFTC (6%)24.
French unions are currently facing a strong decline in membership. Since the 1970-
1980’s crisis, unions have lost about 2/3 of their members and today less than 8% of
the active population is unionized. This makes France the European country with
the lowest rate of union membership. In the public sector, this rate is about 15%,
25 while the private sector only reaches a 5% unionism rate27.
24 Setruk, 2009
25 Griffuelhes and Pouget,1906.
26 Marx, 1848.
27 Chertier, 2006
13
2. Problem Discussion
Our data collection began as attempt to gain an understanding of both sides of the
union/company conflict issue in the context of comparing French unions and
American unions. However, as data collection ensued, IBM was reluctant to engage
5 us. This was our first indication that there might be a problem. If IBM were
comfortable in their dialogue with unions, they would probably be willing to discuss
the topic with us. Consequently, our research continued down the path of a union
perspective.
Taking a union perspective does not mean that we are solely aiming to assist unions,
10 nor does our intent to increase companies understanding of union perspective aim
to solely assist companies. Rather, it is to assist both ends in overcoming their
conflicting objectives to achieve their mutual objective: company success. Unions
need companies to succeed as much as companies want to succeed.
4. Relevance
Companies can benefit from the understanding of stakeholder management in
regards to unions. By more adequately mapping unions, companies can address
25 how and why unions move within the stakeholder map. How to deal with unions
once they move or prevent them from moving is outside the scope of this paper. But
14
by understanding the means in which unions achieve influence, companies have a
starting point for the management of unions.
15
II. Methodology
1. Point of Departure
Our interest in this area was prompted by our participation in the Atlantis study
abroad program. Both of us have had or will have the opportunity to visit each
5 other’s respective countries, France and America. Since our relationship began,
there has been constant dialogue comparing the two. During our time together in
France, there was a French union strike. Through this experience, one of us was
able to see the peculiarities of a French union strike compared to an American union
strike. Thus, our thesis was born.
10 2. Philosophical Perspective
Our theoretical framework is in relation to stakeholder analysis. This includes both
stakeholder management and mapping. Stakeholder analysis was selected because
companies can benefit from the understanding of stakeholder relations, and within a
company, unions are stakeholders. With this common thread, (that is, all unions are
15 stakeholders regardless of physical distance), stakeholder analysis proved the most
effective way to increase the understanding of how to manage two relatively non-
comparable entities (French and American unions).
3. Choice of Method
We were aware of the existence of a problem but didn’t have a clear understanding
20 of its definition. Therefore we decided to study the patterns that would emerge from
our data collection, and use the existent literature to understand the meanings and
potential applications of our findings.
We realized we were not only interested in taking a picture that would give a
general view of the situation, but also wanted to give the camera to the different
25 unions and analyze the similarities appearing on the subsequent prints.
16
4. Data Collection
Primary data
The professionals we selected for our interviews are experienced union workers,
who hold a managerial positions in their organization, and therefore have the
5 authority required to provide us with receivable data concerning the perspective of
unions. Moreover, their scope of competence was not restricted to IBM, since they
are related to organizations acting on a larger level, which allows us to extend the
validity of our findings to a broader scope than IBM.
Due to geographical distance, all our interviews were conducted over Skype or via e-
10 mail questionnaire. When the interviewees requested it, we sent the list of our
questions a few days in advance in order to allow them to research the data
required. The information was collected in the form of semi-structured interviews.
This allowed for the interviews to remain organic and flexible based upon the
interviewee, while still keeping the conversation on track. We started the
15 interviews with a short presentation of the subject and scope of our thesis, in order
to avoid obtaining irrelevant data. However, we didn’t want to influence their
answers by suggesting a pattern, so we asked them general open-ended questions.
Question examples include:
17
Interviewees Table
Here is a classification of our 5 interviewees, with the description of the
organization they belong to and their position within the organization.
5
CWA
(Communication Workers of
CWA district 4
Jeff Lacher America)
organizing coordinator
American communications and
media union
UNI
(Union Network International) Telecommunications
Marcus Courtney
Global services and skills worldwide Department Manager
unions
Treasurer, Organizer,
Web Maintenance
Rick White Alliance@IBM
and Health & Safety
Representative
18
Secondary data
Our secondary data comes from various books and Internet sources. When using
Internet, we wanted to make sure of the validity of the data collected, and therefore
5 used mainly governmental publications, as well as unions and IBM’s official
websites. This data helped us define the background of unions and the origins of the
differences between French and American unions.
5. Ethical Considerations
Our interviewees were incredibly receptive and open to discussion. Because we
10 were exploring the existence of a problem and the nature of what that problem
might be, our interview questions were non-threatening. Our questions did not
assume there was fault on either side. Rather, they looked to identify a conflict.
This was important, because union representatives were willing to engage us in
dialogue where they felt comfortable to express their concerns.
15 It was imperative that we were honest with all interviewees in regards to our thesis
topic and use of their interviews. It is important to note that the French
interviewees were interviewed in French, and the interview was then translated.
We also asked for consent (via e-mail) from all our interviewees to use the data they
provided in our thesis. We obtained this consent. In addition, upon completion,
20 every interviewee will be provided with a copy of our final work.
6. Delimitations
There were several viable options that could have provided framework for analysis.
While aspects of organizational theory are employed to an extent, it was found that
organizational theory was not sufficient for the bulk of our analysis. Because French
25 and American unions are so structurally different, we could not compare using
organizational theory, only contrast. And while many differences between French
and American unions stem from cultural differences, providing an understanding of
culture does not assist in the management of unions as well as stakeholder
management does. In addition, our research is conducted in the context of private
19
unions, not public. While some principles of our findings may apply, we are not at
liberty to defend that, as public unions are outside the scope of this paper.
7. Analysis
Our initial data collection allowed us to find patterns within the mindset of union
5 representatives. After patterns of union thinking were established and further
supported by secondary sources, origins of conflict were identified. Our choice of
theory allowed for the data to be categorized in three ways: data that relates to
union power, data that relates to union urgency, and data that relates to union
legitimacy. With this information, we were able to begin the process of solving the
10 problem.
20
III. Theoretical Framework
If our purpose is our compass, our theoretical framework is our map. The theory
that we present here is necessary for the development of the data collected. As
stated, stakeholder management and mapping is the theory that will be utilized.
5 While stakeholder theory is extensive, we feel we have chosen several articles that
will provide a sufficient base of knowledge for the analysis of our data.
1. What is a Stakeholder?
As previously stated, “A stakeholder in an organization is any group or individual
who can affect or is affected by the achievement of the organizations objectives.”28
10 Mitchell, Agle, and Wood, further define stakeholders, stating that all stakeholders
hold at least one of the attributes power, legitimacy, and urgency.29 This does not
mean that anyone who holds one of these attributes is a stakeholder. It must be
thought of with the same logic as ‘a square is a rectangle, but a rectangle is not a
square’. Any party can buy a gun and have a degree power, but it is not until this
15 party is placed within the context of an organization that it is a stakeholder. These
three attributes of power, urgency, and legitimacy will be defined and expanded
upon, and will be the basis of our empirical analysis.
2. Degrees of Influence
While legitimacy, urgency, and power are all different, they are all interrelated.
Power is affected by legitimacy and urgency, and power effects legitimacy and
28 Freeman, 1984
29 Mitchell, Agle, and Wood, 1997
21
urgency, etc. However, the following paragraphs will explain these attributes in an
individual sense, in order to define their individual relation to influence.
Power will be later defined as the “ability to influence”. But what is influence? In
the context of Freeman’s definition, it is the “affect or is affected” section. Mitchell,
5 Agle, and Wood use the term “salience” as “the degree to which managers give
priority to competing stakeholder claims.”30 A stakeholder is “salient” to a company
because the company can influence the stakeholder or the stakeholder can influence
the company.
But influence is not a light switch. There are degrees of influence. Therefore, in the
10 context of this thesis, influence is the degree to which a stakeholder can affect the
achievement of the organizations objectives.
3. Attributes
Legitimacy
Legitimacy is defined by the Merriam-Webster Dictionary as “accordant with law or
15 with established legal forms and requirements” or “conforming to recognized
principles or accepted rules and standards.”31 Even if legitimacy is intertwined with
the notion of power, they have to be considered separately, as the popular
assumption that legitimate stakeholders are necessarily powerful and vice versa is
incorrect.
22
constructed system of norms, values, beliefs and definitions.”33 This definition will
also be the definition of legitimacy within the context of this thesis.
33 Suchman, 1995
34 Weber, 1947
23
reasonable arguments.35 Suchman believes that the threshold of legitimacy
required depends on the organization’s will to gain active or passive support: “If an
organization simply wants a particular audience to leave it alone, the threshold of
legitimacy may be quite low.”
5 Urgency
To understand the stakeholders’ behavior, one must understand the concept of
urgency. The Merriam-Webster dictionary defines urgent as “calling for immediate
attention”36. However, Mitchell, Agle and Wood develop this definition and add that
urgency exists only when two conditions are met: “when a relationship or claim is of
10 a time-sensitive nature and when that relationship or claim is important or critical
to the stakeholder”37.
Criticality refers to the importance the stakeholder gives to his claims, and time
sensitivity refers to the degree to which he believes the organization should be
reactive and attend to these claims. The degree of criticality of a claim depends on
15 the four following attributes: ownership (the stakeholder possesses a certain
amount of the company’s assets), sentiment (the value given to the relationship with
the company, regardless of performances), expectation (the anticipation on the
future benefits the stakeholder will obtain during his relationship with the
company) and exposure (the importance given to what is at risk in the relationship
20 with the company).38
Contrary to power and legitimacy, urgency does little to “increase” the influence a
stakeholder might have on the organization. However, it enhances the stakeholder’s
quest for influence. It is the catalyst for action.
35 Suchman, 1995
36 "Urgent," def. 1a
37 Mitchell, Agle, and Wood, 1997
38 Mitchell, Agle, and Wood, 1997; 867-868
24
Power
According to Mitchell, Agle, and Wood, power is defined as follows: “…a party to a
relationship has power, to the extent it has or can gain access to coercive, utilitarian,
or normative means, to impose its will in the relationship.”39 It is also noted that it
5 can be acquired and lost.
The terms coercive, utilitarian, and normative come from Etzioni. Coercive power is
based on physical recourses that utilize force, violence, or restraint. 40 Examples
include guns, locks, and any means that affect the body. Utilitarian power is based
on material or financial resources.41 Money is an obvious candidate for utilitarian
10 power, but this also includes human resources. Normative power refers to power
that is based on symbolic resources.42 This type of power is largely intangible, such
as love, or prestige and “title”.
Frooman states that power stems from a firm’s “dependence” on resources that give
“actors leverage over a firm.”43 Resources are defined as “essentially anything an
15 actor perceives as valuable”, and dependence is defined as “a state in which one
actor relies on the actions of another to achieve particular outcomes.”44 Frooman
also states that attributes applied to stakeholders must actually be applied to the
relationship between actors, not just the actor. Finally, Frooman states “who is
dependent on whom and how much-determines who has power.”45
20 Mitchell, Agle and Wood’s definition, Etzioni’s three types of power, and Frooman’s
theory of resource dependence lead to the definition of power within the context of
this thesis: “the ability to influence.”
25
Frooman’s article “Stakeholder Influence Strategies” implies that power is the most
important of the three attributes presented by Mitchell, Agle, and Wood because
“…in those cases where interests diverge and the firm is unwilling to change its
behavior to accommodate a stakeholder, power is likely to decide the outcome.”46
5 Frooman’s theory of how stakeholders pursue influence is presented below.
Influence Strategies47
Frooman’s article is important because it takes a stakeholder perspective, just as
this thesis does. There are four types of influence strategies, based on dependence,
that derive from the combination of two types of resource control and two types of
10 influence pathways. They are indirect/withholding, indirect/usage,
direct/withholding, and direct/usage (see below) .48
As stated, dependence is “a state in which one actor relies on the actions of another
to achieve particular outcomes.”49 To expand, the more a firm is required to
15 respond to a stakeholder for survival, the more a firm is dependent on a
stakeholder. The more a stakeholder relies on the welfare of the firm for its own
survival, the more a stakeholder is dependent on the firm.
26
There are two types of resource strategies, withholding and usage (remember that a
resource is anything an actor sees as valuable). Withholding is when a stakeholder
withholds its resource, while usage is when a stakeholder continues to provide the
resource it controls with conditions attached. Both of these involve the stakeholder
5 using a resource for leverage.
There are two types of influence pathways, direct and indirect. Direct is when a
stakeholder itself uses resources for leverage, while indirect is when the
stakeholder works through an ally to use resources for leverage.
27
4. Mitchell’s Mapping50
Latent stakeholders possess only one trait. The dormant stakeholder has only
10 power and has little association with the firm. A firm should remain aware of a
dormant stakeholder, but there is no reason to take action. A discretionary
stakeholder has just legitimacy and a firm may engage it if it chooses. A demanding
stakeholder has just urgency, and deserves no more than a passing glace by the firm.
28
Expectant stakeholders possess 2 traits. Dominant stakeholders possess power and
legitimacy. They will be given much of a firm’s attention. Dependent stakeholders
have both legitimacy and urgency, but are dependent on another stakeholder for
power, such as the firm or media or government. Dangerous stakeholders have
5 power and urgency, and firms must identify them but not acknowledge them, lest
the firm provides them legitimacy.
Finally, the definitive stakeholders possess all three traits. Firms must give these
stakeholders priority.
5. Analysis
10 While the Mitchell, Agle, and Wood’s model will provide the primary means for our
data analysis, we aim to expand it to fit our thesis. There will be an emphasis on
power for the following reason, which will be elaborated later:
15 That being said, we would like to expand Mitchell, Agle, and Wood’s model based on
the following principles:
As stated earlier, all three attributes are interrelated. This is supported by Mitchell,
Agle, and Wood; “Power gains authority through legitimacy, and it gains exercise
through urgency;”51 and again… “…like the power attribute, legitimacy’s
20 contribution to the stakeholder salience depends upon interaction with the other
two attributes: power and urgency.”52 If all attributes are inter-related, all
attributes can affect power. Consequently, all three attributes affect the ability to
influence. This relationship is not necessarily direct; it can also be inverse (e.g.,
power can be increased through legitimate or illegitimate means, or stated another
25 way, legitimacy can decrease and power increase). Regardless, all three attributes,
viewed as a collective whole, have an impact on the degree to which a stakeholder
29
can affect the achievement of an organizations objectives, or influence. Therefore, in
the context of this thesis, the center of Mitchell, Agle, and Wood’s model will be
referred to as “influence”.
Frooman critiques that even though Mitchell, Agle, and Wood state “Stakeholder
5 attributes are variable, not a steady state,”53 their stakeholder typology does not
imply that, especially in regards to power:
“In this article I consider the resource dimension of a relationship and the
power that stems from it, viewing power, then, as an attribute of the
relationship between the actors-not of the actors themselves. This differs
10 from previous accounts of power in the stakeholder literature (e.g., Freeman,
1984; Mitchell, Agle, & Wood, 1997).”54
Consequently, in the context of this thesis, the three attributes will be viewed not as
absolutes, but as variable degrees. This implies that the stakeholder map could look
like either of the following:
15
Notice that there is greater area in the very center, or greater “influence”, in the first
example than the second.
30
Finally, we deepen the three attributes presented by Mitchell, Agle, and Wood to
include Suchman, Frooman, and others as follows:
31
IV. Empirical Data: A Case Study at IBM
1. Unions’ Objectives
When conducting our interviews, we wanted to have the union’s insight on their
objectives as a common voice for employee objectives. Therefore, the data
5 presented contains the perspectives of the unions only.
Many are convinced that this lack of understanding is the core of IT workers
frustrations. John Miano, cofounder of The Programmers’ Guild, claims that
25 employers waste resources through actions that stem from ignorance, such as
55 Levinson, 2001; 2
56 Tynan, 2008; 1
32
putting employees in noisy cubicles rather than providing closed offices; offices that
would cost much less than the loss of productivity cubicles create. In addition,
training is often the first cut made to IT sectors, but up-to-date training is essential
in a rapidly changing industry such as IT. Alliance@IBM if fighting to defend IT
5 workers needs such as these. Since the pension spurred origins of “Alliance”, issues
have expanded to include wage cuts, job cuts, long working hours, unfair firing, and
cutbacks. And recently, Alliance@IBM has been dealing more and more with
employee job security. It may seem as though layoffs would be inevitable due to the
downturn in the economy, but IBM’s profits were up 12% as of fourth quarter 2008
10 and the company has been described as a “shining star in the technology sector
amid the recession.”57
But Lee Conrad argues that IBM has still resorted to secret job cuts and off-shoring;
“Our focus has changed recently with a renewed emphasis on IBM’s secret
job cuts and off-shoring of US jobs […] We alert the media to IBM’s job cuts
15 when we start getting information from employees. We have become the
only source for information on IBM job cuts because IBM is remaining
silent.”58
The Alliance has responded by sending e-mail alerts and questioning IBM’s request
for aid from the Obama administration. And while employees are fearful that
20 unionization may accelerate or increase chances of job loss, Lee Conrad hopes
himself and his officers will lead by example, as most are current IBM employees
and still retain employment.59
According to Jeff Lacher, the set of demands of high tech workers often split
between what temporary workers want, what “permanent” workers want and the
57 Taft, 2009
58 Conrad, 2009
59 Conrad, 2009
33
state of the economy. Today, job security is the most important concern for both
groups, followed by benefits (pension and health care) and flexibility and wages.60
15 However, Marcus Courtney considers unions’ objectives more or less the same
everywhere, and states that they “basically consist of increasing the freedom to
bargain collectively, increasing the freedom to organize, and improving the political
climate to achieve those62
60 Lacher, 2009
61 La Déclaration, 2009
62 Courtney, 2009
34
Linda Guyer, Alliance@IBM organizer and author of “www.allianceibm.org: Real-
World Experiences of Online Organizing”, vouches for the strong corporate culture
that IBM seems to have lost:
“For well over 80 years, management philosophy has been to provide top-
5 notch benefits and job security, and to treat workers with great respect.
Much of this philosophy originated with the founders of the company, who
admired the ideals of Walther Reuther (founder of the United Auto
Workers). Employees placed their trust and loyalty in the company for many
years, and many have found it difficult to truly believe that management is
10 now comprised of cut-throat businessmen who see people as expensive
resources.”63
This change in the perception of IBM values and concerns also appears in France.
According to Frank Setruk, IBM deserves its reputation of a paternalistic company.
This “may be linked to the negative image they have of unions, which leads to the
15 fact that IBM position often consists in saying that the management is here to take
the right decisions, they don’t need the unions to know what they have to do.64”
Jean-Claude Arfélix also mentioned that “IBM is reputed for its anti-unions policy, in
France but also in other countries like Japan and America. Often no respect of labor
law, or doing just the minimum they need to remain legal65.”
20 Frank Setruk declares that IBM values slowly took less importance, and were
replaced by more economically driven choices. Concern for people is less and less a
primary value for IBM, who used to raise those principles as moral guidelines for the
company.
“You have to find a middle ground, common sense. Find a balance between
25 ethics and company policy, company values. And a company like IBM is
supposed to defend them. It is not the case anymore but when I was hired,
63 Guyer, 2001
64 Setruk, 2009
65 Arfélix, 2009
35
what I liked a lot was the existence of IBM principles. There were 5 of them,
and the first one was: respect of the person. This is gone, we don’t mention it
anymore. It’s sad because it was something that meant a lot and of which I
was proud. Today it’s more the respect of the shareholders, even duties we
5 have toward the shareholders, the notion of sacrifice. And I don’t agree with
this. […] Short term profit seeking is not compatible with long term
development of social agreements. 66”
This change in company values tends to reinforce unions’ will to implement reforms
that would protect workers, especially in those times of crisis. However, they both
10 find it difficult to engage a dialogue with the company.
The problem that Alliance@IBM faces, and that partly explains their difficulty to
communicate with IBM, is a lack of recognition. As stated by Jeff Lacher,
Alliance@IBM has no formal contact with the company. The company, under the
law, doesn’t have to meet with them, acknowledge them, and recognize their
15 existence. So they do their best to pretend Alliance@IBM doesn’t exist67. Lee Conrad
confirms this information, and underlines that this absence of recognition has a
strong impact on their level of bargaining power: “We do not have collective
bargaining rights or recognition by IBM, we engage IBM through our issues in the
media. IBM has decided not to engage us except in rare occasions. We have met
20 some senior IBM officials informally.68”
However, he also believes this is not only due to the lack of representation of
Alliance@IBM. According to him, ”many of the issues Alliance@IBM faces here in the
US are faced by IBM unions worldwide. IBM does not like unions and tries to limit
their influence everywhere.”
25 When asked about the reasons for these communication issues, Jeff Lacher told us
that companies could easily improve relations with unions by ceasing to view their
66 Setruk, 2009
67 Lacher, 2009
68 Conrad 2009
36
employees as the enemy and acknowledging that the union is their employees. In
other words, companies often make the same mistake the public makes, which is a
mistake sometimes even union members make, and that is that the union is
something other than the workers69. This tendency to ignore unions and consider
5 them as a threat rather than an asset is in contradiction with the statement that
companies often make, which is that their employees are at the base of their
business, and therefore one of their main assets.
“If companies truly viewed their employees as a vital part of the business'
success, they would deal with the employees' elected representatives with
10 the same respect as they would any other business partner. Perhaps we
deserve much more respect, without us, the company does not function at
all.70”
He says that recently, the profile of human resources managers recruited by IBM,
who are the main interlocutors of the unions in the company, are mostly lawyers.
“The image I have is the one of two countries such as Israel and Palestine, in peace
69 Lacher, 2009
70 Lacher, 2009
71 Chertier, 2006.
37
negotiation, where one would send its Trade secretary and the other would respond
by sending its Department of Defense secretary. 72”
For him however, the solution of the problem is not about unions, but people:
“We have to talk about men and women; it is easier, because this is linked to
5 human nature. A reasonable number of people are very interested in
themselves and their own interest. I won’t surprise you by saying they are
also present in unions. Managers like them because they are easier to
manage, to control. Is it the majority? No. But they highly contribute to the
negative image of unions and union organizers.73”
As previously stated, unions are finally currently allowed in France by under the
Waldeck-Rousseau law74, which still presents some restrictions (such as the
15 prohibition of unions in the publi and protected by the constitution. Moreover, labor
law is extremely important, and unions contribute to a large extent to its
development, but unions’ organization itself is not highly regulated.
Two singularitiesy lieslie in French Labor Law: contrary to civil law, sources are not
articulated in function of hierarchy but content. In other words, the most favorable
20 position for the employee applies. A second unique characteristic is the extension of
collective agreements to all French workers concerned by with the agreement, not
only the union members75.
Collective bargaining takes place at three levels: national, sector, and company
(which corresponds to the three levels of the organization of labor unions). Only the
72 Setruk,
2009
73 Setruk,
2009
74 Waldeck Rousseau Law.
75 Charoux and Jeaneau, 2008
38
five representative confederations of unions76 can conclude a collective agreement.
They are organized as follows: At their head, the general secretary, elected by the
labor union authorities, leads the union. At the national level, some deliberative
assemblies are in charge of defining the main orientations of the union and of
5 assisting the general secretary. Local federations work at the regional level. The
union section, present in the companies, constitutes the base of the unions. They
group the employees who are members of the union within the company. Each of
the five “representative” labor unions can decide to create a union section in the
company, no matter how many employees there are.77
15 Local unions usually handle grass root relations with union members, as well as
daily operations within the union. Most local unions are part of a national union,
which is a group of local unions.
National unions are usually organized by industry. National unions handle a great
deal collective bargaining, and wield significant political influence. Their other
20 duties include guiding local unions. Some examples of national unions are the Farm
Labor Organizing Committee (FLOC), the American Postal Workers Union (APWU),
the Writers Guild of America, East Inc. (WGAE) and the Communications Workers of
America (CWA).79 As of 2008, the industry with the highest union membership was
local government workers (i.e. teachers, police officers, fire fighters) at 42.2%.80
39
Sales and related occupations had the lowest rates in 2008, at 3.3% 81. National
unions then can join federations, which are groups of national unions.
Federations have the greatest lobbying power, but do not handle collective
bargaining. The largest federation in the United States at this time is AFL-CIO
5 (American Federation of Labor and Congress of Industrial Organization) with 56
member unions and over 11 million members.82 In the summer of 2005, the AFL-
CIO lost approximately 35% of their membership when several member unions
defected and formed Change to Win (CTW), which is now the second largest
federation in the United States.83
10 The union American organizing process can be divided into five steps84. First,
contact is established, either by an employee to a union, or by a union to an
employee. Second, the union confirms interest by pursuing authorization cards
signed by employees. When 30% of employees have turned in authorization cards,
the union can establish contact with the National Labor Relations Board (NLRB),
15 which is the governing body behind American labor unions, and petition for a union
election. The third step requires the employer to provide the NLBR with the names
and addresses of union eligible employees, who then forward the list to the union.
The fourth step involves the union and the employer “campaigning” for 30-60 days
to solicit votes in the election. Finally, a secret ballot election is a held, and if
20 majority is obtained, the union is established.
4. Unions’ Issues
40
collar” unionism lost strength as the “white collar” section among the working
population was growing.
So while organization has become the largest challenge for CWA unions, the reasons
seem to stem not from industry related problems, but the environment in which IT
unions operate. Alliance@IBM is an example of a union that faces that very
20 problem.
Finally, American unions have to face the fact that many IT workers see themselves
in a position that is not traditional of union representation. Most IT workers are
white collar, many with bachelor degrees and up. Organizer Tom Steed of the
Communications Workers of America's Poughkeepsie office said: ''What I find at
25 IBM is that people, basically, they're hyper individuals. ... They don't understand
85 USDL, 2009
86 USDL, 2009
87 Lacher, 2009
41
what unions are. They say, here I am with my master's degree and I'm not suitable
for a union.88''
Lee Conrad, in an interview with InfoWorld, agrees, stating that "Even though IT
workers are considered a different type of animal, they're still impacted by the same
5 things that hit the manufacturing industries 10 or 15 years ago – pay cuts,
downsizing, and loss of benefits."89 Jeff Lacher also concurs, stating that the
manufacturing sector of IBM does not view themselves any differently than the
software engineers, and all need to understand that they are part of the same
organization90. American white-collar unionism is not developed, partly because
10 people don’t understand the interest they might have by joining a union.
“We have a regular increase of the number of our members, partly because
we are a more moderate union, with logics of negotiation and establishment
of agreements, rather than of contestation. More and more people are
looking for this kind of approach, rather than a more radical action.”
20 With the development of the CGC and white collar unionism, moderate unions hope
to find a way to improve the dialogue with French companies, and especially IBM,
and stop the dual opposition that characterizes French social dialogue. 91
88 Steed, 2009
89 Tynan, 2008; 2
90 Lacher, 2009
91 Setruk, 2009
42
addition, 40% of IBM employees are mobile or work from home.92 Jeff Lacher of the
CWA claims that organizing is much more effective in a face-to-face context, and
when members are scattered across the country, it makes joint activities and
organizing campaigns difficult. Picketing and protesting to gain union awareness is
5 near impossible when gathering employees in one place requires immense time and
resources.
“Union members don’t have the resources to fly around the country and meet
with everybody who has a question about the union, so a lot of their
organizing is done online or over the phone or through the website through
10 email and over the phone. Most people who actually join the union do it on
the website. Which then turns into a difficult thing because the strength of
our union comes from the activism of the members, if they’re scattered
around the country, it’s very difficult to conduct joint activities.93”
92 Conrad, 2009
93 Lacher, 2009
94 Guyer, 2001
43
However, traditional organizing means are still utilized. When IBM initiated a
pension controversy in 1999, IBM employees began wearing CWA t-shirts at work.95
Flyers are handed out at specific IBM worksites, and rallies and picket lines are held
at stockholder meetings and other select IBM events.96 However, Lee Conrad claims
5 that at this point it is still easiest to reach employees via the website and email.
Next is the physiological factor of unionization. While employees have always been
hesitant to join unions, whether from fear of challenging their employer, fear of job
loss, or pure anti-union sentiment, the current economic market has increased
union insecurity. Lee Conrad states:
10 “We have to help IBM employees get over their fear of joining an
organization that actively challenges their employer. It is a psychological
dilemma. There are also many employees who are anti-union and will never
join the Alliance”97
Jeff Lacher acknowledges that with the current job market so precarious and
15 current union legislation so thick, new industries face unprecedented organizing
challenges. This is especially true for the relatively young unionization effort within
IBM.
95 Wolf, 2004
96 Conrad, 2009
97 Conrad, 2009
98 Chertier, 2006
44
“In France, country of the Human Rights, union conquest have been made in
a very “generous” way, since everything unions negotiated, they decided to
extend it to the entire working population immediately. For example, social
security doesn’t benefit only union members, but the all society. If it wasn’t
5 the case, frankly, France would be 100% unionized!”
The second reason that justifies low union membership rates is that unionism
originates from the Marxist ideology, with a revolutionary vocation. “That is why we
have a strong ideology and often a negative opinion of a unionism extremely
politicized. That is something that has a negative impact on unionism in general. 99”
10 Marcus Courtney underlines this French paradox, stating that France has a large
bargaining, with “roughly 65-70% of workers covered under bargaining, but only
maybe 5% membership.100”
One of the biggest problems French unions face while bargaining is not so much
membership alone, but lack of coordination and cohesion between the several
15 unions. Because each of them wants to appear the most effective union for their
workers, they tend to engage in unrealistic demands when negotiating with the
company. This observation is made in most of French companies. And IBM doesn’t
depart from the rule, according to Frank Setruk:
“When we negotiate salaries raise, it is not common to ask less than the
20 colleague. So when everyone exposes its claims, we usually end up with
unrealistic ones. I would like us to be able to ask reasonable and realistic
raises but it is rarely the case. Because by “principle”, you have to ask a lot to
get the employees mobilization, show them you are fighting for them,
because of this Marxist history.101”
25 At the international level, Marcus Courtney believes that this lack of membership is
even more an issue today, due to the globalization of companies:
99 Setruk, 2009
100 Courtney, 2009
101 Setruk, 2009
45
“The question is that as globalization marches on, companies are no longer
just French companies, they’re multinational companies, and how will the
current unionization model be able to sustain itself of low membership, high
coverage, when the corporations will want to attack that at some point. And
5 will they have enough political power and leverage and membership to
systematically stop the undermining of rights. I would argue they won’t.102”
He considers that in many ways, global corporations are empowered, like the WTO,
through almost supra national state structures: “I mean the WTO is kind of its own
little body that regulates and empowers investment rights within national
10 structures within these companies. They have enormous amounts of power; they
have enormous amounts of leverage, over national governments and national
unions.” In comparison, unions’ bargaining power is very low.
“We on occasion send IBM letters or email in regards a specific issue. IBM
does not respond but we “see” the response. IBM reacted during our
campaign around pay cuts and our pay cut petition by sending high level
executives around the country to halt the outrage among employees.”103
25 Consequently, the most effective tool at the Alliance’s disposal is simply pressure.
Most of Alliance@IBM’s clout comes from their contact with the media. The pension
crisis of 1999 was solved by “creating such a fuss in the media and by getting the
46
senate to hold a hearing”104 says Jeff Lacher. “We alert the media to IBM’s job cuts
when we start getting information from employees. We have become the only
source for information on IBM job cuts because IBM is remaining silent 105”, adds Lee
Conrad.
5 The Alliance also uses legislature and political supporters to accomplish their goals.
From time to time, lawsuits have been used to defend employee’s rights. As far as
political action, Bernie Sanders, a Vermont Senator, has an IBM plant in his state,
and supports the Alliance, as well as Maurice Hinchey, a house representative from
New York whose district includes Endicott. Grassroots protesting is conducted,
10 from picket lines, to leaflet and flyer distribution.
“As I said, there is no direct contact with the company, so anything we try to
get the company to do is done through the media, through the legislature,
through just pressure, outside, to try to change the companies’ behavior, and
its works, from time to time, and we have major success106”.
15 Jeff Lacher recognizes the lack of bargaining power of unions, especially in the IT
industry:
“IT workers started organizing as soon as they had jobs. It just that they
didn’t get to the point of actually major successes of organizing collective
bargaining agreements because by the time IT came into existence, the labor
20 laws in the US became so ineffective and so easily violated, that its practically
impossible to organize at all, under CB in the US. So certainly for new
industries it’s no easier.107”
French unions adopt a similar approach, compensating for their lack of institutional
power by drawing media and public attention on the issues they face. However,
47
their methods differ a lot in practice. French unions have a strong tendency to use
strikes as a mean of pressure.
“From now on, when there is a strike, no one notice108”. This sentence, pronounced
by the French president during his political party council in 2006, and describing
5 the situation in France, created a “polemic”109. However, this caricatured opinion is
somehow a reflection of the situation in France, and its differences with America.
French labor unions are famous for their spectacular displays of action when they
defend workers’ interest. Strikes and protests are culturally accepted in France,
mainly due to the cultural heritage of unions, based on the ideology of class struggle
10 and therefore strong conflicts between workers and employees. But it is important
to understand what the legal definition of a strike is, and why they have become a
common place in France.
The right to strike has been a constitutional right in France since 1946110. A strike is
a collective interruption of work by the employees, in order to defend a professional
15 claim. According to the French law, three combined criteria characterize a strike: An
interruption of labor, no matter for how long (to execute a defective task on purpose
is not considered a strike); a collective interruption of labor (however, the final
court of appeal has admitted that a strike can be conducted by a single employee of
the company) and that this interruption must be motivated by professional claims
20 (non-political). During a strike, the employment contract of strikers is interrupted
(they do not receive a remuneration), but not broken, unless the employee commits
a major act of professional misconduct. 111
48
According to Frank Setruk, French IBM unions try to use strikes at strategic periods,
such as during the yearly negotiations between unions and company executives for
example112, because:
To pressure the organization at such a key moment for the unions would be a good
way to make sure the company takes into consideration workers’ claims. However,
they tend to face a lack of support from the employees.
“Since employees benefit from everything unions negotiate, they don’t agree
15 at all to go on strike during wage negotiations for example. Especially
because they tell themselves: since my raise will be decided by my boss, my
interest is to be a model employee. When we propose, we reach 3% of
workers on strike. The management wants to tell us: “Hold on, people don’t
listen to you, why should I?” And people who went on strike might be the
20 next victims of official or unofficial restructuration plans”.113
He also says that people are surprised that “workers are on strike all the time in
France, but there are just no agreements to stop them.”
It is interesting to understand how the current economic situation has affected the
unions. All our interviewees acknowledge the impact of the crisis on unions’ work,
25 mainly because the general public now pays more attention to the social aspect of
business, and is aware of the potential consequences of an economy focused on
49
financial profits only. “I think that the crisis brings us more to the forefront, the
unions have been focusing on this and it’s kind of an untold story. The unions are
ahead of the curve on globalization and understanding globalization114”, states
Marcus Courtney.
20 ”Visionary corporations from around the globe, such as Michelin, IBM, and
Xerox, have all established and grown significant presences in Second Life.
They are working in Second Life in a wide variety of ways--from holding
meetings, conducting training, to building product prototypes or simulating
business situations in a safe learning environment.116”
25 UNI realized that the advantages that Second life brings to IBM can also apply to its
unions:
50
”UNI plans to use Second Life™ to create a community for affiliates, which
will let trade unionists from around the world meet and work together on
shared issues. The project also aims to use the medium to present union
campaigns to a new audience, and enable a new generation of online activists
5 to have more input into union activities.117”
Their actions consist of virtual strikes and protests that unite avatars of IBM
employees from all over the world. UNI co-organized the first Virtual “strike” in
history on September 27th, 2007 against IBM, because of a management issue in
Italy. With 2000 participants of the ”real world” joining the virtual action, the ”real
10 life” dispute ended positively for the unions, with the resignation of IBM’s Italian
general manager and the obtaining of a new contract.
An important reason for the success of the operation is certainly the media coverage
obtained by the unions: the news story went all around the world, and showed the
incredible potential of web-based tools for the unions. It also gained an important
15 recognition from the French government, and won the French Senate award of “the
most innovative and exemplar initiatives of the Web118”.
51
V. Analysis
1. Conflicting Objectives
French unions and American unions are incredibly different. Structure, collective
bargaining, attitude, and organization tactics differ between the two. As this thesis
5 attempted to analyze French and American unions, the study turned into a contrast
rather than a “compare and contrast”. However, after analyzing the data, a link
between the French and American unions was found; most similarities between
French and American unions lie in the sole fact that union objectives usually differ
from company objectives. That is, French union objectives may differ from
10 American union objectives, but French and American union objectives usually differ
from company objectives.
While the ultimate goal for both companies and unions is company success, the
opinion of how to achieve this varies, which is where unions and companies usually
find their disagreements. Our interviewees feel that IBM’s pursuit of short-term
15 profits undermines employee welfare. They also feel that companies do not view
unions as vital to company success. In addition, IBM’s values include “trust and
personal responsibility in all relationships.” However, according to our data, there
is a growing concern among unions that IBM has forgotten the ideals that have lead
it this far. It seems clear that unions feel their objectives differ from company
20 objectives.
Frooman stated about the importance of power: “…in those cases where interests
diverge and the firm is unwilling to change its behavior to accommodate a
stakeholder, power is likely to decide the outcome.”119 It seems an obvious
statement that unions and companies can have conflicting objectives, but it is less
25 obvious what happens when they do. According to Frooman, the entity with greater
ability to influence is likely to achieve its objectives. Therefore we can say that
union’s main objective is to increase influence.
52
2. Influence
Remember our definition of influence: the degree to which a stakeholder can affect
the achievement of the organizations objectives. Through the analysis of Mitchell,
Agle, and Wood, we determined that the center their Venn diagram equates to
5 influence. Therefore we can conclude the following:
This statement requires elaboration. Five employees are angry over a labor dispute,
so they buy guns. The fact that they are employees gives them a degree of
10 legitimacy, they are urgent because of the dispute, and they have power from the
guns. They technically retain all three attributes. But the chance of them effectively
resolving their dispute is very small. The company is most likely not going to have
the achievement of its objectives affected for very long. But lets say these
employees still retain urgency, but instead of buying guns, band together with other
15 employees to increase legitimacy and power. Now the employees have a greater
chance of affecting the achievement of the organizations objectives, or greater
influence. This analysis aims to understand how unions gain the degree of power,
urgency, and legitimacy necessary to effectively influence a company.
3. Urgency
20 After analyzing the data, the following statement was concluded:
This seems obvious. But depending on how urgent a union is, a union is more likely
to pursue influence. We found urgency to be the catalyst for action; the reason
unions seek an increase in power, and consequently legitimacy.
25 In 1999, when Alliance@IBM was formed, an urgent situation, the change in pension
plans, gave them enough urgency to organize and seek authority through the media
and government. When all the IBM unions united for their international “Second
53
Life” strike, they were presented a situation that called for immediate attention
(Italian wage increase rejection). They then united internationally to gain more
power and legitimacy (authority). It is probably a safe prediction, at least according
to Marcus Courtney, that unions will find a way to use the current economic crisis as
5 a tool to promote an increase in authority as well.
Unions always have urgency in some sense or another. The simple fact the union
exists means that there is enough urgency to justify its existence. That base of
urgency is what leads unions to legitimize themselves in the first place. Jeff Lacher
stated that there is organizing at the advent of every new industry, it simply starts
10 small. As stated, this analysis is all about degrees. The more urgent a situation is to
a union, the more they will pursue influence.
4. Legitimacy
After analyzing the data, the following statement was concluded:
54
Legal status falls under cognitive legitimacy. It is taken for granted that a union is
protected under the law. In fact, our data confirmed that unions are indeed
protected under the law, which intrinsically gives them some form of legitimacy.
Moral legitimacy is more contextual, based upon an assessment of the claims and
actions unions make. In this instance, unions must make “reasonable arguments.”
This is where French unions encounter difficulties. There are so many unions
15 competing for employee membership that they will often make unreasonable
requests to attempt to prove their commitment, or instrumentality, to members.
However, by doing this, they actually decrease their legitimacy in the eyes of the
company.
5. Power
After analyzing the data, the following statement was concluded:
55
Of the three types of power (coercive, utilitarian, and normative), unions seem to
rely most on utilitarian power. While unions and their members have the capability
of coercive power, coercive power tends to decrease legitimacy, as using violence
and force is usually restricted under social norms (law). Normative power is also
5 not a viable option for unions, as it is difficult for unions to gain “sympathy” or
influence via love or symbolic significance. Therefore, it can be concluded that
unions primarily pursue utilitarian power, which is the power that is based on
material or financial resources.
Frooman’s theory is based upon resource dependence, which states that power
10 stems from a firm’s “dependence” on resources that give “actors leverage over a
firm.”122 This is consistent with the notion of unions pursuing utilitarian power, or
power based upon resources. From this point, unions can be analyzed based upon
resource dependence.
The degree to which a union feels the company is dependent upon its resources will
15 determine whether a union pursues a direct or indirect strategy. If a union
perceives that a company is dependent upon the resources the union retains, unions
will pursue a direct strategy. And if a union perceives that a company is not
dependent upon the resources the union retains, unions will pursue an indirect
strategy. Union’s main resource, that is, what companies see as valuable, is
20 employees. If a union feels they have enough employees that they can “use” or
“withhold”, they will pursue a direct strategy. This does not necessarily equate
simply to membership. Members must also be willing to endorse and support the
union, which Frooman defines as making the threat “credible.”
The degree to which a union feels it is dependent upon a company’s resources will
25 determine whether a union pursues a usage or withholding strategy. If a union
perceives their welfare is highly tied to the welfare of the company, it will pursue a
usage strategy, and if the union perceives that its welfare is less tied to the company,
it will pursue a withholding strategy.
56
By understanding what means a union will pursue in order to increase its ability to
influence, companies can increase their understanding in matters involving union
relations.
6. Application
5 All of our findings can be applied to our research within IBM unions.
Alliance@IBM
As a company, how would one map Alliance@IBM based upon Alliance@IBM’s
perception of itself? We argue the map would look something like this:
10 Alliance@IBM perceives itself as quite urgent. All Alliance interviewees feel their
concerns are time sensitive and important. Alliance@IBM is working incredibly
hard to increase membership and awareness. All officers interviewed shared the
opinion that union representation is necessary for IBM employees, whether they are
aware of it or not.
57
lack of majority does not allow for them to obtain collective barging rights. In
addition, Alliance@IBM is aware that at this point in time their usefulness is still
limited, which means they have low pragmatic legitimacy. Alliance@IBM does feel
they retain a high level of moral legitimacy, as interviewees felt that their claims are
5 morally sound and their procedures just. However, this overall low level of
legitimacy allows IBM to give Alliance@IBM what Suchman refers to as passive
attention, rather than active.
58
French IBM Unions
The same mapping can be applied to French IBM unions, in order for managers to
gain an insight into unions’ demands, anticipate their reactions and improve their
relations.
Just like Alliance@IBM, the degree of urgency of French IBM unions’ claims is
dependent on the situation. However, at this point in time, based on the context of
our interviews, French IBM unions do not seem incredibly urgent. While the French
unions are mildly urgent simply because they are established, there are currently no
10 major disputes, and the incentive to increase power and legitimacy is not very high.
French unions benefit from a high cognitive legitimacy, as they are institutionalized
and their existence is protected by the highest legal text in France, which is the
Constitution. Moreover, since they function on a national level, and not company-by-
company as they do in America, they are socially recognized. This is due in part to
15 their historical presence in French economic life. This means the main source of
their legitimacy comes from cognitive legitimacy. Their pragmatic legitimacy is
relatively high as well. They perceive themselves as useful to both workers and
general public, because the collective agreements apply to all workers. The level of
59
outputs for non-union members is much superior to their inputs. A weakness of
French IBM unions would be their lack of moral legitimacy. Because of their
tradition of contestation and connections with the hard-left wing ideology, their
claims may be perceived as highly confrontational, which reduces moral legitimacy.
5 French IBM unions have many laws that protect them from dependence on a
company. The law clearly defends a “unionism of direct action”, which further
encourages direct action. However, French IBM unions only hold a small percentage
of employees. Contrary to the public sector, private companies’ unions have
relatively low support from workers when they initiate a strike. Therefore, even if
10 they can act directly, they need external stakeholders’ support to gain enough power
to influence the company. French IBM unions generally use a combination of direct,
indirect and withholding strategy. The launch of a strike or a protest is the easiest
way to gain the media attention, and gain the external support they need.
7. Analysis
15 What does this mean for IBM? First, it must be noted that the information contained
within this thesis is to assist companies in increasing their understanding of how to
manage unions, not instruct companies how to manage unions. Second, it must be
noted that the map is constantly changing, therefore must be constantly re-
evaluated.
20 That being said, several predictions can be made regarding Alliance@IBM’s future.
As stated, we see urgency as the catalyst for the pursuit of power and legitimacy.
Therefore, we see Alliance@IBM attempting to achieve power and legitimacy quite
intensely due to their high level of urgency. However, since legitimacy is so closely
tied to power, and legitimacy is more in control of unions, we feel Alliance@IBM will
25 attempt to achieve greater legitimacy first. They will most likely do this by
attempting to increase pragmatic legitimacy through increased membership and the
attainment of member goals, and increasing cognitive legitimacy by working
towards majority and supporting legislation that gives unions more rights. If
Alliance@IBM becomes less dependent on IBM, Alliance@IBM might pursue
60
different strategies of influence such as indirect/withholding. Only if Alliance@IBM
gains enough members (resources) to have IBM become dependent on them will
Alliance@IBM be able to move to a direct strategy.
Similar predictions can be made regarding French IBM unions. The most significant
5 observation is that currently, French IBM unions retain a relatively low level of
urgency. IBM may want to attempt to avoid giving French IBM unions a reason to
become urgent. A reason may present itself externally, but IBM cannot control that
factor from their end. Additionally, French IBM unions see themselves as
confrontational, and the data supports this. Therefore, French IBM unions may see
10 that they can increase their legitimacy through increasing the legitimacy of their
claims and actions. Finally, French union mindset and law stems back to Marxist
ideology, and French unions may look to encourage that further by increasing their
resources and moving closer to a pure direct/withholding, or stakeholder power,
influence strategy.
15
61
Conclusions and Recommendations
This thesis set out to provide companies with a better understanding of labor
union’s perspective, which would allow for more effective stakeholder mapping and
management of unions. Consequently, companies increased understanding should
5 assist both companies and unions in overcoming their conflicting objectives to
achieve their mutual objective of company success.
Our findings expanded upon Mitchell, Agle, and Wood’s typology of stakeholders to
include several other stakeholder theories, including Frooman’s and Suchman’s.
Our data then concluded that while French and American IBM unions may have
10 different objectives, both French and American IBM labor union objectives
conflicted with company objectives. Our remaining data, in combination with our
theoretical framework, lead to four statements:
20 Finally, our statements were applied to French and American IBM unions, and it was
demonstrated how companies might use this information to more effectively
stakeholder map and manage.
For further research, the significance of urgency could be further explored. It seems
that urgency is a very important factor in regards to unions specifically, as much of
25 their support and validation is derived from conflict. In addition, while public sector
unions could be analyzed as stakeholders in a similar manner as the unions
62
presented in this thesis, public sector unions differ highly and thus would lead to an
interesting but altered discussion. Also, an analysis of how companies can manage
unions could prove useful. Finally, this report was done from a union perspective.
In the same fashion that companies may benefit from understanding a union’s
5 perspective, unions may benefit from understanding the company perspective.
63
Works Cited
AFL-CIO. www.aflcio.org - America’s Union Movement. 2009. 27 Apr. 2009
<http://www.aflcio.org/>.
5 site for the IBM Employees’ Union CWA Local 1701, AFL-CIO.” Alliance@IBM CWA
Charoux, Françoise, and Yvonne Jeaneau. La Legislation du Travail. N.p.: Nathan, 2008.
Chertier, Dominique Jean. “Pour une Modernization du dialogue Social, Rapport au Premier
<http://lesrapports.ladocumentationfrancaise.fr/BRP/064000351/0000.pdf>.
15 union.org/>.
<http://jp.malrieu.free.fr/SES702/IMG/pdf/syndicalisation_DARES_.pdf>.
Davis, K. “The Case for and Against Business Assumption of Social Responsibility.” Academy
2009 <http://www.conseil-constitutionnel.fr/conseil-constitutionnel/francais/la-
64
constitution/la-constitution-du-4-octobre-1958/preambule-de-la-constitution-du-27-
octobre-1946.5077.html>.
(1999): 191-205.
Gibson, Cathy Lee. PHR Exam Prep: Professional in Human Resources, Second Edition. Que
Publishing, 2008. Safari Tech Books Online. ProQuest. DePaul University. 30 Mar. 2009
<http://proquest.umi.com/login>.
10 Guiral, Antoine. “Sarkozy décrète la grève invisible et nargue les syndicats.” Libération 7 July
sarkozy-decrete-la-greve-invisible-et-nargue-les-syndicats>.
presented at the TUC, May 2001. 11 May 2001. The London School of Economics
15 Centre for Economic Performance (CEP), with the Harvard University Trade Union
Program, and the British Trade Union Congress (TUC). 16 May 2009
<http://www.endicottalliance.org/docs/TUC/AllianceIBM_paper.htm>.
Katz, Harry C., Rosemary Batt, and Jeffrey H. Keffe. “The Revitalization of the CWA:
“Labor Union.” Oxford University Press: The New Oxford American Dictionary. 2nd ed. 2005.
65
“La Déclaration Commune du Front Syndical du 5 Janvier.” Challenges 19 Feb. 2009.
politique_economique/20090217.CHA1169/
la_declaration_commune_du_front_syndical_du_5_janvier.html>.
webster.com/dictionary/legitimate>.
Levinson, Meridith. “IT Workers of the World: Are They Uniting?” CIO Magazine 1 May 2001:
<http://web.lexis-nexis.com/universe>.
<http://www.businessdictionary.com/definition/management.html>.
“Management.” Oxford University Press: The New Oxford American Dictionary. 2nd ed. 2005.
Marx, Karl, and Friedrich Engels. Manifesto of the Communist party. N.p., 1848.
Mitchell, Ronald K., Bradley R. Agle, and Donna J. Wood. “Toward a Theory of Stakeholder
15 Identification and Salience: Defining the Principle of Who and What Really Counts.”
Taft, Darryl K. “Report: IBM Set to Cut Thousands of Jobs in Western Europe .” eWeek.com 13
66
Apr. 2009. eWeek.com. 14 Apr. 2009 <http://www.eweek.com/c/a/IT-Infrastructure/
Report-IBM-Set-to-Cut-Thousands-of-Jobs-in-Western-Europe-514770/>.
Tetrick, Lois E., et al. “A Model of Union Participation: The Impact of Perceived Union Support,
Union Instrumentality, and Union Loyalty.” Journal of Applied Psychology 92.3 (2007):
5 820-828.
Tynan, Dan. “Should IT form a union?” Adventures in IT 4 Sept. 2008. InfoWorld. 9 Apr. 2009
<http://www.infoworld.com/d/adventures-in-it/should-it-form-union-100>.
United States Department of Labor. “News: Bureau of Labor Statistics (Union Members in
10 news.release/pdf/union2.pdf>.
webster.com/dictionary/urgent>.
Weber, Max. The Theory of Social and Economic Organization. New York: n.p., 1947.
15
67