COURSE CONNECTOR

 ARTICLE SUMMARIES AND QUESTIONS

"How Facebook Is Taking Over Our Lives," pp. 48-56: Mark Zuckerberg is a young man with a big dream. He wants to build the planet's standardized communication (and marketing) platform, as ubiquitous and intuitive as the telephone but far more interactive, multidimensional, and indispensable. Luckily, the 24-year-old Harvard dropout is already halfway there — he has the platform. The creator and CEO of Facebook, Zuckerberg is quite possibly the world's youngest self-made billionaire, on paper at least. No one is really certain of the true value of the company, because despite having 175 million members worldwide and gaining an astounding 5 million a week, its financial results don’t come anywhere near to matching its runaway success signing up members. The site pulled in estimated revenues of just $280 million last year, and didn't even break even. But those facts haven't deterred Zuckerberg. He's brought in former Google exec Sheryl Sandberg as Facebook's chief operating officer and YouTube's ex-chief financial officer, Gideon Yu, to run his finance operations. Their onerous task is to figure out how to monetize the interactions taking place on the site — a precious commodity to marketers — while keeping the site as unobtrusive to users as possible. Even the optimistic Zuckerberg realizes that 2009 is the company's make-or-break moment, when his audacious dream comes true or Facebook goes the same way as another one-time web superpower, AOL.

Students examine the enormous success of the social-networking site Facebook and the plans its founder, Mark Zuckerberg, has for global domination of the digital world.

Discussion Questions:

1. What does the author of the article mean when she writes that Facebook has "stickiness"? Why is this a potential boon to marketers?

2. Why have traditional marketing tools, such as banner ads, failed on sites like Facebook? Why is any form of advertising a contentious issue on social-networking sites?

3. In your opinion, are CEO Mark Zuckerberg's goals for Facebook realistic? Explain your answer.

"Inside Obama's Economic Crusade," pp. 58-67: Whatever your impressions are of our new President, there is one thing upon which all can agree — he works fast. At a point when previous administrations were still decorating their offices, Barack Obama's team was pushing through Congress the most expensive emergency spending package in the nation's history. Why such emphasis on speed? Some of the President's top advisors, including new Treasury Secretary Timothy Geithner and the chair of Obama's Council of Economic Advisors, Christina Romer, contend that haste was necessary to catch the right moment to turn around the deepening recession, something they argue that governments have failed to do in the past, ultimately causing more damage to the economy. Not everyone agrees that speed is the solution, however. Stanford economist John B. Taylor, author of a forthcoming book critical of government interventions, and Vincent Reinhart, former director of monetary affairs at the Fed and now an American Enterprise Institute fellow, claim that not only is speed ineffective in terms of making fiscal policy but it also hampers legislators' ability to make thoughtful decisions about policies that will affect the nation's budget baseline for years to come. In these chaotic times, it's difficult to know what the correct course of action is, but the Obama team promises to monitor the stimulus to ensure it works the way it is intended.

In this article, students read opposing arguments on the efficacy of President Barack Obama's economic stimulus plan and the swiftness with which it was passed.

Discussion Questions:

1. Aside from taking timely action on the economy before it spirals any further out of control, what political reasons does the article suggest for President Barack Obama's haste in getting his American Recovery and Reinvestment Act passed?

2. What concerns have Republicans expressed about the President's stimulus plan? How has the financial crisis highlighted the serious divisions between Democrats and Republicans on the role of the federal government, particularly with regard to fiscal policy?

3. What metrics will the President's economic team use to determine whether the stimulus is a success? What actions can they take mid-course if it isn’t working the way it is designed to work?

"Changing of the Guard at Wal-Mart," pp. 68-76: Who knew there was so much drama at Wal-Mart? While most people are familiar with Wal-Mart's famous entanglements with outsiders over employee benefits and environmentalism — issues the company has begun to tackle in earnest in recent years — fewer are aware of the infighting that has taken place in Bentonville over the past decade. When Lee Scott took over as the fourth CEO of Wal-Mart in 2000, his ascendancy caused a firestorm at company headquarters. Thomas Coughlin, a rival Wal-Mart executive and close personal friend of Wal-Mart founder Sam Walton, was considered more suitable for the top job by a group of old-school Wal-Mart employees known as the "boots" for their footwear preference. The company began to split along party lines between "friends of Lee's" (FOLs) and "friends of Tom's" (FOTs). When tensions came to a head in 2004, Coughlin decided to retire. His subsequent use of a company gift card ultimately led to an investigation by management. He was found guilty, along with many of the "boots," of ethical violations, and the FOTs were effectively purged from the company by 2006. With Scott passing the reins to new CEO Mike Duke on Feb. 1, some have speculated that his surprisingly sudden departure is due to exhaustion from fighting internal and external forces. Little wonder.

Students take a closer look at the challenges former Wal-Mart CEO Lee Scott faced during his turbulent tenure at the company.

Discussion Questions:

1. What effect does regime change at Wal-Mart have on the business world in general? What specific impact do you think new CEO Mike Duke will have on Wal-Mart?

2. Give some examples of how former Wal-Mart CEO Lee Scott changed the corporate culture at Wal-Mart. How has leading the company changed his approach to management over the past decade?

3. Why did Scott announce his retirement in November? Why was his timing considered unusual by some Wal-Mart insiders?

"Baseball Battles the Slump," pp. 84-90: There is an old adage that says people need distractions when times are tough. So historically, professional sports franchises have sailed through economic slumps unscathed, as fans stressed out by their personal financial woes have turned to sports as a form of escapism. But sports-business experts think the current financial crisis will be different. Sports leagues today are more dependent than they were in the past on economically vulnerable sources of revenue, such as corporate sponsorships, luxury suites, and other premium seating. Consequently, teams have had to get creative about keeping more traditional cash streams — ticket and merchandise sales — flowing. Perhaps the best example of this is baseball's Arizona Diamondbacks. Under a young, resourceful management team, the franchise has used customer service, innovative marketing, and smarter spending on players to keep the wins coming and the turnstiles turning. Some of the tactics include selling upper-deck tickets for as little as $5, instituting "kids' pricing" for concessions, selling caps and T-shirts in team pro shops for about a third of what other teams charge, giving away free tickets to local schools, and hosting post-game concerts and fireworks shows. Results have been encouraging for the team, and Diamondbacks fans are grateful for the much-needed diversion.

This article profiles the Arizona Diamondbacks' management team and the approaches the team has taken to remain profitable during the economic downturn.

Discussion Questions:

1. Why was the Arizona Diamondbacks franchise more prepared than many other teams to deal with the economic crisis? What particular challenges does the Diamondbacks organization face in the Phoenix-Mesa-Scottsdale market?

2. What is the "Moneyball" school of team roster-building? How has it been used effectively by the Diamondbacks' general manager, Josh Byrnes?

3. Chicago White Sox owner Jerry Reinsdorf suggests that Diamondbacks' CEO Derrick Hall could become commissioner of baseball someday. On what does he base his opinion? Do you agree with him? Why or why not?