Academic journal article Business Case Journal

Dane and Company: In Search of Corporate Social Responsibility in Indonesia

Academic journal article Business Case Journal

Dane and Company: In Search of Corporate Social Responsibility in Indonesia

Article excerpt

This case was prepared by Craig Sasse and Anthony Tocco both from Rockhurst University. The views presented here are those of the case authors and do not necessarily reflect the views of the Society for Case Research. The authors' views are based on their own professional judgments. Copyright [c] 2010 by the Society for Case Research and the authors. No part of the work may be reproduced or used in any form or by any means without the written permission of the Society for Case Research

All the giving options Quentin Dane, owner of Dane and Company, was now considering for his company had significant shortcomings both politically and socially, which led him to wonder, "Should I just leave well enough alone or should I choose one of these other forms of corporate social responsibility [CSR]?"

After approximately three years, Dane was reconsidering how he could make a difference in the Indonesian community where his furniture was made. To gain an advantage from supplier relationships and to help his workers, Dane's initial strategy was to pay above market wages to his Indonesian workers. He settled on a daily wage of $3, generous compared to the going local rate of $1, but he did not see his wage policy having an impact on the community. In fact, he saw it having the unintended consequence of hurting the structure of the largely three generation furniture-making family businesses.

In lieu of the wage premium, Dane had considered a number of different CSR options, which he now saw as part of his corporate responsibility. He was considering making charitable contributions to the local community, offering health care and/or computer sharing benefits for his workers, or even setting up his workers in their own export business. Regardless of which option or options he chose, the unique cultural and political norms of Indonesia had to be factored into any decision. As he considered these options, Dane thought, "I never knew corporate social responsibility, doing what is right for the most people, could be so difficult. I just wanted to help the people and community of Jepara."

Background

After graduating from college with an accounting degree in 1996, Quentin Dane rose quickly in the financial services industry working for Wells Fargo and J.P. Morgan. By 2001, he was running a successful 401K Rollover venture for J.P. Morgan out of a satellite office in Kansas City. When J.P. Morgan asked Dane to move to Cincinnati, Ohio, Dane refused. When the company would not back off its request, Dane decided that he wanted to be his own boss and not be subject to the whims of corporate directives. By the beginning of 2002, Dane, at least psychologically, became an entrepreneur.

Dane considered a number of entrepreneurial ventures, including franchising, importing, restaurant investment ventures, and real-estate; he settled on starting an import furniture business under the name of Dane and Company. The people he knew in the wholesale furniture industry indicated this was a potentially lucrative business. After Dane did some industry research and planning, his company started business in April, 2002.

Dane explained his thinking for going into the import furniture business and his decision to produce in Indonesia:

   The industry I decided to enter was wood furniture. After weeks of
   research I found that new opportunities lay overseas. For the past
   10 years, the furniture industry had been moving operations to
   countries like Indonesia, Malaysia, India, and Vietnam. I realized
   that if I wanted to compete in this business the only thing I could
   do was start overseas. So, with my eyes shut, I threw a dart at a
   map and it landed on Jepara, Indonesia, or at least real close to
   it.

The Furniture Business in Indonesia

Jepara, which is on the island of Central Java, is a city of roughly 10,000 people. The city is in the middle of the jungle and its economy is dominated by furniture-making and exporting. …

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