Reflection

Coming into this class I had not realized how extensive the study of the economy of organizations can be. I had an interest in the topic so I had high hopes that it would be an interesting course. I definitely feel that this project we are working on has helped make this class what I expecting coming in. I enjoy learning new terms and the different approaches that organizations take to advance themselves, so I feel like incorporating more of that into the class would have made it more effective for me.

I mostly enjoyed the online and offline structure of the class but sometimes I feel like it had some flaws. For example, I never felt that I really learned about excel homeworks, which made it very difficult to do on my own with the occasional video to help guide me. I wish we would have spent more time reviewing excel homework on Wednesdays like we do on Mondays with our blog posts. The blog posts were a fun part of the class. I never had the opportunity to do something like this in a college course and to be able to write on my own experiences was pleasurable. I also frequently would read my classmates posts and seeing all these different perspectives was a really cool way to see how different people react to different things. I appreciate that blog posts are a large part of our grade because I feel that it reflects what the class was built around. Blog posts seemed to always play a large part in our discussions and relate to our topics.

I sometimes had difficulty completing the blogs before the due date because I am really only able to write quality posts when I am alone with little distractions. I like to be able to put a lot of thought into my posts so I make sure that I cover everything I need to. The commenting aspect of the blogging process is nice because I often forget to include things in my initial post and am able to include it in my response to other comments. The blogs usually take me about 30 to 45 minutes once I start writing. Excel homework takes much longer as I usually do not really know what steps I should be taking, and with my busy schedule this semester I sometimes can't complete it by the deadline. I have been able to complete some within an hour, while others I spend a couple hours on and never figure it out.

Some improvements I would suggest were outlined above, such as spending time in class on excel homework. I also think it can be hard to pay attention for a full 1hr 20min lecture without any visuals or interactive lessons. While listening to somebody speak is a lot more effective to me than simply reading, a combination of the two allows the audience to take better notes and stay more attentive. I would also suggest implementing a hard deadline. Having a flexible deadline was very nice, but sometimes I would feel like I could slack off for a night and then I ended up stressed out on a Saturday morning making sure I get my blog post in before they were considered late.

Reputation

Ever since about middle school I have had a reputation as being quiet and laid back, which is often misconstrued as being shy. People like to assume that since I would rather listen to others than hear myself talk, I must be a extremely introverted. This can get a bit annoying but people are usually quick to realize that I just don't care to be involved in everything that is going on.

While this reputation exists in basically every aspect of my life (friends, work, school, etc.), I will focus on it in a work environment. I once had a job that included a lot of driving and people usually did not want to take their cars even though we got paid a fair amount per mile. While I never made an effort to drive, as it is occasionally nice to just sit in the passenger seat and relax, I would always volunteer myself if nobody else wanted to. I feel that there is no reason to make a big deal out of something so small, and arguing over something so unimportant does not lead to anything worth while. Basically every time I am asked to do something on the job, even if it is from somebody that has no authority over me, I go ahead an accept it because I find it easy to say yes, which I feel reflects my laid back attitude.

Just today I was at work and my supervisor complimented my ability to stay calm and collected, especially when faced with a high volume of work. While this is an example of one of the benefits of being laid back, having a reputation can yield a mixture of results. For example, the fact that I say yes to a lot of small tasks makes it easy for people to approach me with new tasks, which can lead to more work than I can handle.

I am sure that if everyone in an organization had the same attitude and reputation as I have then things wouldn't run very smoothly. An organization needs people of many different reputations in order to achieve things efficiently in my opinion.

There are definitely points in my life where I would like to stray away from my reputation in order to have a bit more control of situations, but my reputation mimics my true personality so it is often hard for me to actually go through with such actions. I feel that I will someday begin to transform my reputation in a way that helps my career goals be met, but for now I am very content with my reputation and its influence in my life.

I can not think of a situation where I would have the opportunity to cash in on my reputation in favor of some immediate game. I would be very interested to hear of any possible was that one could cash in on a laid back reputation.

Triangle Principal Agent

One summer I didn't do very well in my job search and ended up getting a job as a delivery driver for a local pizza place. Not a great job but with tips and a car with decent mileage I was about to make a pretty good amount of money. It was very easy but every once in a while I would encounter a principal agent problem that was rough to deal with because it was not my fault and not always easy to resolve.

The process was basically an assembly line. The cashier would get a call and take the order, then the cooks would make the pizza and put it in the oven. When it was ready somebody cut it up, put it in the box and called the name of the driver who was to deliver the order. Easy process, generally very efficient. However, every now and then I would get to the house and hand the person their order and they would take a look to make sure it is right. A lot of times if it was wrong, the person would just accept it if it was basically the same thing. There was this one time that I was given the wrong thing and when I arrived at the customer's house to deliver it, they were very angry to see that it was wrong and since they were paying in cash, they refused payment. With the position I held I had no ability to offer the customer anything to make up for the mistake. The company did not like to waste money so they were very hard to talk with on the phone when things like this go wrong. Therefor, I was usually just stuck in the middle of this, trying to satisfy the customer who I have to deal in the present, and also satisfy my employer who I have to make sure if fine with everything I do so that I do not suffer any consequences in the future. I am not entirely sure if this qualifies as a principal agent problem, but it at least has similar qualities in that I am working to satisfy two parties at the same time.

The whole tip situation is another example, and this one is probably experienced by every worker who relies on tips. If customers do not tip I do not receive any money other that the very low hourly wage. It is an issue because the employer doesn't make up for that by throwing a little extra money your way, so I just feel like I wasted gas by driving there because I would have made the same amount of money by staying at the store. I think it would be fair for the company to give me a couple bucks in that situation, because they wouldn't have made any money in that situation if they did not have anybody to deliver it. This is a principal agent problem because I am getting treated unfairly by both sides when this happens.

Conflict

One year over the summer I worked for a party services company where we supplied all kinds of party goods to customers, from popcorn machines to bounce houses. It was not a very good job. Management was poor, schedules often did not come out as quickly as they promised they would, and pay was not anything special. Employees who had been working there for years were still making low pay, but most were students who intended on moving on to better things after graduation, so they did not care all that much. However, there was at least one person who was not pursuing higher education and was getting very frustrated with her pay and was awaiting her next opportunity for a raise.

I worked with her the following day and she was furious. Apparently she got a 10 cent raise when she was expecting 50 because she had been there for years and never got a raise she thought she deserved. It ended up being a pretty high salience issue around the office and a handful of people took sides, which made some relationships that were formerly very healthy into negative ones. Both people were generally not very well liked, so I am not very sure how the sides were formed. I had only been there for two months at this point, so I cannot say for certain if past occurrences impacted peoples decisions. Since I really hate working in a workplace with that kind of tension and full of negativity, I could not wait until summer was over because I had no intentions on returning ever again.

I did not publicly take a side because I hate confrontation and I thought the way that the employee handled the situation was very immature and naive. However, I definitely agreed with the employer and his decision to only up her pay by a small amount. It was clear that she was not deserving of a substantial raise given the way she reacted. The job was heavily based on customer service and I have witnessed her get in arguments with customers, which just goes to show that she is always as hot tempered as she was when she didn't get the raise she wanted.

While our boss was not very good at what he did in my opinion, he was fairly accommodating. I feel that if my coworker took the proper steps to seek out a compromise instead of being so assertive, she could have argued her way up to a higher pay in a civilized manner. For example, she could have emphasized common goals by saying something like "I feel that the raise I received has negatively impacted my motivation because my years of experience in this job merits an increased wage." Both parties would benefit from this because her motivation to perform well would build a better relationship with customers and bring more money in to the business. I have never had to negotiate like this so my approach may not be perfect, but knowing how my employer operates, I feel that it would be effective.

By reacting the way she did, she broke off the ability to have healthy conversations and if I was the boss, I would already be looking to find somebody to replace her.

Individual vs Team Production

I found the beginning half of this reading to be extremely interesting. As more changes were made to the experiment, I was able to start connecting these experiments to real life. I was not surprised at all by the results, as I would have expected things to go similarly. The chimpanzee experiment was an interesting addition to the article, but I feel that it was not very applicable to what they were looking for. Once they started relating it to what Obama and Palin were saying, I kind of got lost. Relating the kids to big companies being in cahoots with the government was illogical, as they did not mention anything about the kids and the experimenter colluding. However, their point was not lost as it is clear that corporations do buy laws from the government.

Anyway, individual production and team production are displayed very well in the article. When kids pulled the individual ropes on their own, they took what they got because they did not feel that the other kid helped them get what they received, which is a reasonable argument. However, when they helped one another by each pulling on a connected rope, they generally shared, which is expected and should be the case in most scenarios. At first glance into real life situations that this experiment applies to, it doesn't look like marbles are being traded. Through gift exchange, marbles can be shared from one person to the other. For example, every once in awhile an NFL kick returner will bring a kickoff all the way back to the end zone for a touchdown. This results in praise for the man who ran it back. However, often times if you look at the tape of the play, the blockers on the return team all just made their blocks and the runner was able to run through a straight path, but that goes unnoticed to the public, so he is getting the endorsements and fame. This fills their hypothetical cup with a handful of marbles. In contrast to that, NFL teams' staff is very talented and can notice the players making the big blocks, and they get big money for their role on the team, so they get a couple marbles thrown in their cup.

It may seem like the star player is far better off, which realistically he probably is, but his blockers are being taken care of too. There are many instances where players buy things for their supporting cast. A couple years ago NFL running back Arian Foster broke out to be one of the best players in the league. While the public thinks he is just a god, he knows that he wouldn't be as good as he is without his linemen. To thank them for their effort and helping him earn his big money contract, Foster bought all of his offensive linement segways (http://espn.go.com/nfl/story/_/id/8765459/arian-foster-houston-texans-rewards-linemen-segways).

An example of the disconnected rope where each person pulls their rope and gets a random amount of marbles is slot machines. Slot machines are individual production and most people, upon winning money from a slot machine, are not going to share with the person at the machine next to them. Even though it was complete luck, they are not going to say "hey, let's split this." On rare occassions a jackpot winner will share with the people around them, but that is generally only when they either know the people from before, have just met them and have been talking while playing, or sometimes people consider the people around them good luck charms. However, those cases do not relate to the experiment because the kids just walked into a room and had no connections to the other children.

Managing Income Risk

Managing income risk is something that has been a priority of mine since the start of high school. I began trying to figure out what markets had more demand for employment and based classes I took off that. Though I used to want to do Engineering and didn't give that up until Freshman year of college, I believe I have still been able to manage my income risk pretty well even with the change of plans. I wish I could have managed to get a double major, but things did not work out for me in that respect.

I chose to major in Economic because there is always a use for an economist. It is also a very flexible degree that can be applied in many different business related fields. I plan on exploring the job market quite a bit when I graduate. I am very interested in working in a major city outside of the Midwest. I also would like to have a job in business but outside of economics, but I realize that I will need to prove that I can be useful in other fields through internships or taking sufficient classes on the same topic. In order to manage income risk in that perspective, I am taking classes in other fields to figure out what I want to do beyond economics. I am also studying abroad in Belgium next semester and taking classes in economics, which I believe will be incredibly helpful in my job search. Having knowledge of different systems of economics could make me a much more intriguing candidate for positions.

The job market is and will always be incredibly competitive, which is a very good thing in my opinion because people will always be working their hardest to get or keep a job. One thing I do is take classes that I believe will not only work towards credits for graduation, but will also teach me a lot and show employers that I am diversified in my education. That is one of the main reasons I took this class. I am going to work for an organization in the future, so having knowledge about how things work from the outside could prove to be very interesting when I am inside of one.

I have two older brothers who both majored in engineering fields here at the University of Illinois. They both managed income risk extremely well by getting involved in the campus community, working internships that have good reputations, and studying abroad. They are both working very steady jobs and have already began working their way up the ranks of big name engineering firms. Neither of them has encountered any big surprises, which I believe is because they managed income risk perfectly. They both had many job offers right out of college and had their choice of employment. My big take away from their experience is that college is the critical time in your life to build your resume and that your first job could be crucial to how your entire career plays out.

Illinibucks

The idea of Illinibucks here at the University of Illinois is a very interesting concept that if implemented, would have a lot of possible issues. It would be a great way to introduce students to a real life application of economics as it relates to scarcity. In a scenario where students are allocated a specified amount of Illinibucks, they would have to manage their capital wisely and plan where and when to use them.

There are not many functions of Illinibucks I can think of. The obvious one is choosing classes. The issue I have with this is that if we give everybody enough Illinibucks to afford whatever cost it is to skip the wait for choosing classes, I personally believe that almost everybody would use it on that. A way to make it more effective may be to allow people who use their Illinibucks for scheduling classes to skip ahead a day or two, making it valuable but not quite as much as skipping to the front of the line, which would surely crash the Enterprise website. Also the University clearly has reasons for why they give some students priority. If people used Illinibucks to cut in front of other people, older students may not be able to take classes they need because an underclassmen who doesn't necessarily need to take the course has a seat since he bought his way to an earlier registration spot.

I know other schools have programs where they are allocated an amount of credits, similar to meal plan credits that people get in the dorms here, but they can use it at restaurants around campus. However, I highly doubt Illinibucks could be used for that purpose since a deal would have to be made with participating restaurants where the University covers all or some of the cost in exchange for the Illinibucks they are receiving from students. I could definitely see that being a program that students here would be very interested, especially if Chipotle and other Green Street restaurants got involved.

I saw in another student's post the idea of spending Illinibucks on scheduling finals. This is something I could see being useful as long as faculty could find a way to prevent cheating between students in the same class with different exam dates. Final weeks is obviously the most stressful period of the semester, and sometimes people just get completely screwed on final exam dates and times. I have friends in Engineering, taking the hardest classes on campus, that have 4 exams in 2 days, but since there aren't conflicting times or there is a small gap in between exam 2 and 3, the University does not allow them to move any exams. In my opinion this is a huge issue and it can really hurt people's grade point averages.

Also, as a quick note on registering for classes and not getting into desired/required courses. This semester I was trying to get into Econ 303 but it was full. Knowing there were students that were just pointlessly holding onto the course and waiting until the deadline to drop, I checked every day hoping to snag a spot. I emailed the professor and she said that she couldn't make any exceptions to the class size limit. Luckily on the last day to register for classes a spot opened up and I got in the course, but I was already weeks behind so I had to catch up on a lot of work and missed out on a handful of graded assignments. I just checked what the current enrollment is and there are 11 spots remaining, which could have gone to students that need it. I think there should be a wait list for classes, because right now it is basically just luck, hoping that you're the first one who checked for an opening since somebody dropped.

Team

Lately I have been watching the new Netflix show Narcos which is about Pablo Escobar and Colombia's Medellin Cartel. It is a great show so I will do my best not to include any spoilers. While at first glance it seems like Cartels can be unorganized and mindless, the show offers an inside look on the operations controlled by drug king pin Pablo Escobar in the 1970s and 1980s. I am only half way through the series so I still have a lot to learn, but it has really amazed me how smart these criminals could be, which explains why Escobar lasted as long as he did and why the Cartel was so powerful and remains in tact.

One of the structural assumptions that stood out to me as I was reading Bolman and Deal was "Troubles arise and performance suffers from structural deficits, remedied through problem solving and restructuring". While the Medellin Cartel has a different method of problem solving than most organizations, they managed to solve their problems pretty efficiently. They basically had no limits, which allowed them to get what they wanted almost all the time. Whether it be paying off corrupt government officials and police or killing somebody who gave information to the people hunting them down, their purpose was to retain balance in the organization.

One of Katzenbach and Smith's six characteristics of high quality teams reads "High performing teams develop the right mix of expertise". This is very evident in Narcos. As a vertically coordinated organization, the entire cartel is led by Escobar who, through authority and a mostly unspoken set of rules and policies, controls the work of his employees. He divides certain duties to certain people who specialize in that sector, who then divide further, similar to the structure of the graph we saw in class a couple weeks ago on the structure of University of Illinois staff. One man controls production of the drugs, one man routes shipments and works on smuggling into the United States, one plans assassinations, and so on, all under the commands of Escobar. This exemplifies the characteristic that teams have complementary skill sets because they all specialize in an area to help contribute to the cartel's mission.

The only characteristic of a high quality team that I found hard to relate to the Medellin Cartel in Narcos is "Members of high performing teams hold themselves collectively accountable". More times than not a mistake within the organization is credited to one person, who then undoubtedly receives punishment in the form of death. I do believe that in most cases Katzenbach and Smith are correct in considering that a distinguishing characteristic, but in this case I consider the cartel high quality even though that characteristic is not evident.

Lastly, Bolman and Deal has a very interesting quote in the Chapter 3 when focusing on Challenges of Global Organizations. It reads "No company can operate effectively on a global scale by centralizing all key decisions and then farming them out for implementation". The story of Pablo Escobar proves this theory to be true in the end considering the eventual death of Escobar in the 1990s and diminishing power of the Medellin Cartel.

Opportunism

There are many times in my life that I was given a great opportunity but turned it down in order to protect something else, whether it be a friendship, money, time, or something else, but it never really gave me long term regret. However a friend of mine has had an experience where he turned down a great opportunity that ended up being an even bigger opportunity when all was said and done.

I had a friend in high school that ended up moving but we kept in touch. He moved somewhere in New York and was attending a huge high school that is very well known in the New York area but I can not remember the name of it. He's a huge theater geek and always did plays and everything for as long as I can remember. When he first got there high school he did a couple plays and theater productions and ended up getting a pretty good reputation. I remember one day he was telling me that the lead role in their big Spring production, which I think was Our Town, was having a lot of trouble and was way behind schedule in learning all his lines and the other things people do in plays. Couple days later he tells me he was offered to take over the role because the teacher was nervous the other kid wasn't going to be able to figure it out in time. Since my friend was new he did not want to make anyone mad so he ultimately turned it down. Couple weeks after the play is over and they are all done he learns that the kid who played the lead was contacted by some big acting school in New York saying that their scout or something happened to be at one of the showings and wanted to do an interview for admission into the school. There's obviously no guarantee that he would have given a good enough performance to get the same offer, but now that kid is in that acting school and my buddy is going to school in New Jersey. We have not really talked about it that much but I can tell he regrets not taking that opportunity.

This is a good example of the idea that "Good things happen to those who wait" because I am sure that, since this was not his last theater production in high school, he thought he was going to have another chance for the lead role. I am similar in that way. I am not much of an opportunist and try to get through life making the least amount of people angry as possible. While sometimes it pays off to take an opportunity that looks promising, there are definitely times where an opportunity looks great but ends up being a huge regret. It is always really hard to tell and that is what makes opportunity an interesting topic.

Blog Post 2

I used to work at a grocery store in high school. I worked there from Sophomore year until I came to college. There was a hierarchy in the my department of the store. There were baggers, checkers, and managers. In my mind it was a pretty flawed system because when we were short on checkers, lines got very long because baggers could not help by using the registers and managers were either busy doing other things or just felt like that wasn't part of their job. I was a bagger so I was not very involved in the business side of the operation, however I did occasionally talk to the managers about it.

My senior year our company was bought out so we merged with others and in an effort to make all stores the same, we changed things around a bit. Before these changes, our customer service was great. All of the employees were relatively happy with their position and customers felt comfortable shopping with us. One change we made was that instead of asking customers if they wanted help out to the car, we were supposed to say "I am going to help you out to your car" and insist to go even if they say they don't need it. It was very clear that people felt very uncomfortable with this. My mother even stopped shopping there because it was just poor execution of customer service at that point. They even forced us baggers to wear aprons at all times, which made zero sense considering we were grabbing prepackaged foods and putting them in a bag.

I feel that those changes presented unnecessary transaction costs. Like I said, the workers basically forcing themselves to go out to your car with you drove people away, losing customers and therefor forfeiting sales. They also lost some quality employees. A friend of mine worked there with me and disagreed with all the changes so much that he accepted another job and left the grocery store. I was given the offer to return for summers but opted to turn it down for another part time job. Just recently I learned that the store manager, who ran the entire store (under the direction of corporate), retired early because he was so fed up with everything he was being forced to do. This was my first real job and it gave me a very negative opinion on large organizations.

Dale Mortensen Econ 490

Picture retrieved from http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2010/mortensen-facts.html

Dale Mortensen was an American economist with a focus on labor economics. He got his Bachelor's degree from Willamette University and proceeded to get his PhD from Carnegie-Mellon University in Pittsburgh, Pennsylvania. Mortensen ended up becoming a professor at Northwestern in 1965, where he stayed for most of his career. He was also the professor of a graduate student named Lanny Arvan and a member of his dissertation committee.

He won the 2010 Nobel Price in Economic Sciences with Peter Diamond of the Massachusetts Institute of Technology and Christopher Pissaride of the London School of Economics and Political Science. His work evaluated tendencies of the labor market with a focus on unemployment. Many people use his work to to help them understand the labor market as well as other fields.

I have heard Dale Mortensen but have never took the time to learn anything about him until now. It is clear that Mortensen had much influence in the field of Economics. His work in labor economics will remain very influential for a long time. I am sure a lot of what we will learn will involve some of his work.

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