YouTube

I created my first youtube video! My video discusses a potential crisis UMG can go through if an artist needs to cancel a concert and how consumers react. Let me know what you think :)

Legal Ethical Corporate Issues

Universal Music Group needs to follow all the ethical and legal standards the community holds just like every other company. There are four main responsibilities a Corporate Social Responsibility framework suggests to follow in order to stand as a positive company in the industry and local community. The first is to be economic. This means that the company’s main goal is to be profitable and maximize revenues. The second is to be legal. A company should obey the laws in which it operates. Third, the company should be ethical. It is important for a company to not participate in questionable business and regulate the company standards around what the community finds to be ethical and unethical. The final responsibility in the framework is to be philanthropic. It is important to be seen as a positive member of the community. It will keep relations with investors, media, and other companies positive if your company is seen as good corporate citizens.
A main problem that Universal Music Group comes across is the public’s desire to attain music from signed artists for free. It is neither legal nor ethical to download music from an unlicensed source. Illegally downloading music has been a major concern among the music industry and companies have suffered great economic loss due to the decrease in CD sales. It would be unethical for UMG to not allow anyone to use their songs but can a barrier be placed to determine who can and cannot lease the rights to a song? The barrier would limit who can have the rights to license music. The main question would be then, who would determine if a requesters reason is legitimate enough to believe they won’t copy it or offer it to the public? There is a gray line between legal and ethical issues but this legal issue music labels are facing needs to place new regulations on the matter to stop the public from taking advantage of the company’s ability to lease out the rights to their music.

Crisis Management Plan

In our last class we discussed all aspects of a crisis management plan. The first step is assembling a crisis management team. This team includes members of your company such as the company CEO, public relations specialist, lawyer, and human resources. The second test is to activate the crisis management team and make all of your employees aware of them. This can be through an e-mail, poster, flyer, or even to just run around and tell everyone. In your notice you should include instructions for your employees to follow should a crisis take place, and a backup plan. This leads to the crisis policies established. If it is a private crisis your employees need to know to keep quiet and not discuss these issues with the press. At no point should a random employee address the press on a company issue, it should always be a person determined by the crisis management team. After the policies are formed and distributed the crisis management team should create a crisis decision tree. This tree will include detailed steps on what individuals and the company will do if a crisis should happen. After the tree is made a spokesperson should be elected to address the media. This person should be aware of all the insides and out of the company crisis, and outside news so they can be knowledgeable and expect the unexpected when being asked questions from the press. A final aspect of a crisis management plan is to create a crisis communications checklist. This will help the team make sure they are not missing anything to the plan when a crisis takes place and it can be handled in the best possible way.
Universal Music Group can prevent any crisis from taking place by following these steps and implementing a crisis management plan. If a crisis were to take place then it can be handled right away to the best of UMGs ability. The checklist will make sure that nothing is missed and everything has been done in their power. An example of a potential crisis that can take place is artist budgets slowly decreasing and finally coming to a standstill. Because less people are purchasing CDs artists are relying more and more on other sources to generate revenue such as advertising. This would be a good time to implement a crisis management plan in case they no longer have a budget for artists. The crisis management plan will outline the actions they will take in order to keep their artists signed to their label and keep them happy making money.

Lowered CD Prices

Universal Music has been in high competition with iTunes and their amazingly low prices for CDs and songs. UMG has recently decided to lower their price of CDs in the attempt to increase sales. There is a good chance you can now get your favorite artists CDs at a price as low as $6!

Chapter 9 of Crisis Management discusses different levels of learning, behavioral learning and a deeper level of learning. Behavioral learning seeks to change the external controls of the organization so that crises are less likely to occur and are less serious if they do occur. This level of learning changes aspect of the company such as standard operating procedures, rules, regulations, and technological systems. The deeper level of learning challenges the values and assumptions of the organization. It involves changing the organizational culture and the cognitive arrangement of the company.

The case of UMG lowing CD prices would be considered Behavioral learning. They are attempting to prevent a crisis of low sales and loss of money by attempting to encourage more people to buy their CDs at their newly offered lower price!