Question 2

Levi Strauss, led by Robert Haas, the founder's great-great-grand-nephew, has increased its sales By 31 percent (to more than $3.6 billion) and profits by more than 50 percent since 1985. The spectacular results have come abdut because Levi Strauss changed the way it did business.

First, Levi poured tens of millions of dollars into new-pradhot do volcome, i/marketing, and compare zation on basic product lines, downsized the organization by laying off more than four thousand managers, and trimmed the number of products by two-thirds. Third, a new computer system helped streamline manufacturing and distribution by linking Levi directly to retailers and fabric suppliers. This new system enables customers to order and pay electronically for new inventory.

Links with suppliers let Levi fine-tune the amounts and kinds of fabrics it orders to meet consumer demand. The goal of the system is to electronically monitor the manufacture of a pair of jeans. When the customer buys jeans in some store, that sale is communicated directly to a plant. If the plant's inventory level for that style of jeans is low, an order to manufacture them is automatically placed. Lastly, Levi started to pay attention to what its customers wanted. In just four years, Docker's, a line of casual clothing aimed at the less slim, over twenty-five market, has become a half-billion-dollar a vear success.

Haas paid attention to the global market. As markets open and geographic barriers have become increasingly blurred, Levi took advantage of these changes. In Japan, a jeans revolution is going on. Even women are now wearing jeans.

Until recently, few people would have ever imagined this happening in Japan. In addition to selling overseas, Levi is manufacturing overseas as well. Most Dockers, for example, are made in the Caribbean basin. The reason: Dockers require twice the amount of labor that 501 jeans do.

The greater the labor, the more the emphasis is to manufacture outside of the United States.

To raise productivity as well as help keep morale high, Levi is trying a gain-sharing program.

At its jeans factory in Blue Ridge, Georgia, employees and plant management set productivity improvement goals and agreed to split the savings with employees. Last year, each employee earned an extra $450. Before the gain-sharing program, this was Levi's second-best plant.

Now, it is the best. At another one of its jeans plants in El Paso, Texas, employees work in teams. Each team of four employees sews buttons on 4,037 pairs of button-fly jeans a day. According to Peter Thig. pen, vice-president of manufacturing, all manag. ers at Levi are trying to make work for employees more meaningful. Managers are urged to speak openly to employees, reward them for quality work, and give them more power to make decisions in areas that directly affect them.

The following "Aspirations Statement' flects what Levi Strauss values: re.

We all want a company that our people are proud of and committed to, where all employees have an op. portunity to contribute, learn, grow, and advance based on merit, not politics or background. We want our people to feel respected, treated fairly, lis. tened to, and involved. Above all, we want satisfaction from accomplishments and friendships, balanced personal and professional lives, and to have fun in our endeavors.

When we describe the kind of Levi Strauss & Co. we want in the future, what we are talking about is building on the foundation we have inherited: affirming the best of our company's traditions, closing gaps that may exist between principles and practices, and updating some of our values to reflect contemporary circumstances. What type of leadership is necessary to make our Aspirations a Reality?

New Behaviors: Leadership that exemplifies direct-ness, openness to influence, commitment to the success of others, willingness to acknowledge our own contributions to problems, personal account-ability, teamwork, and trust. Not only must we model these behaviors but we must coach others to adopt them.

Diversity: Leadership that values a diverse work force (age, sex, ethnic group, etc.) at all levels of the organization, diversity in experience, and diversity in perspectives. We have committed to taking full advantage of the rich backgrounds and abilities of all our people and to promoting a greater diversity in positions of influence. Differing points of view will be sought; diversity will be valued and honesty rewarded, not suppressed.

Recognition: Leadership that provides greater recognition-both financial and psychic-for individuals and teams that contribute to our success.

Recognition must be given to all who contribute: those who create and innovate and also those who continually support the day-to-day business re-quirements.

Ethical Management Practices: Leadership that epitomizes the stated standards of ethical behavior. We

" must provide clarity about our expectations and must enforce these standards through the corporation.

Communications: Leadership that is clear about company, unit, and individual goals and performance. People must know what is expected of them and receive timely, honest feedback on their performance and career aspirations.

Empowerment: Leadership that increases the authority and responsibility of those closest to our products and customers. By actively pushing responsibility, trust, and recognition into the organi-zation, we can harness and release the capabilities of all our people.

QUESTION 2

a) What leadership style will work most effectively with those emplovees?

b)What are some problems of leading people who live in foreign countries? How does Levi's "Aspiration Statement" help leaders do this easier?