1. Read the text and think of a title for it.

2. Summarize the text by writing out key characteristics of each type of zone.

Free Ports. Free ports are free zones that cover a lager physical area, typically an entire port city. Free ports often combine the characteristics of free trade zones (FTZ), industrial free zones (IFZ), and enterprise zones (EZ). Perhaps the most famous have been the city-states of Hong Kong and Singapore.

Commercial Free Zones. Commercial free zones also developed out of the trading activities of port cities, but with more limitations and controls than a free port. The main objective of a commercial free zone is the promotion of trade, and most commercial free trade zones function as adjacent to ports, airports, or other international transportation hubs. The physical facilities of commercial free zones are generally simple warehouses and economic activity is trading-oriented. A leading example of this kind is the Jebel Ali Free Zone in Dubai.

Enterprise Zones. In these zones various incentives such as reduced taxes, regulations, and low-cost financing of investments, land are offered to expand employment, export, and import substitution.

Export Processing Zones. EPZs, also called industrial free zones are a relatively recent free trade zone innovation. While sharing the same fundamental characteristics of the free trade concept, EPZs are explicitly designed to facilitate production of goods and services for export market, rather than simple transshipment activities.

Industrial Free Zones. Area or industrial estates outside customs barrier adjacent or near a port, which offer duty free movement of goods, in and out of zone, as well as fiscal, regulatory, and tax incentives. Usually used to encourage establishment of export industries by domestic and foreign investors.

Special Economic Zones. China introduced the Special Economic Zone (SEZ) concept in 1979 as part of its “open door policy” which consciously used the SEZs as proving grounds for market – oriented economic reforms. Although patterned after the EPZ and free port concepts, SEZs feature several important differences, first, they cover a much larger territory than any EPZ and most free ports, from 15 square kilometers to 23,000 square kilometers, secondly, they allow a broad range of economic activities, and thirdly, they offer differential incentives among the various projects. Lastly, strict controls are placed on sales of SEZ goods into the Chinese custom territory, even upon full payment of import duties and taxes.

Hybrid Models. Several countries have allowed for the creation of hybrid zones, which combine features of two or more of the types listed above. The most common combines an industrial EPZ model with a commercial free zone.

There are currently 845 free trade zones that offer comprehensive logistics and production capabilities (UNCTAD, 1999). Particular attention should paid to China which began expanding its logistics facilities through large-scale foreign capital inducement and developed a free trade, adopting a free trade zone system to ensure the free trade of global firms. In case of China, a large number of special economic zones (SEZs) had been established since 1970s and foreign investment incentives were granted to 'coastal cities' to stimulate economic growth and trade development. For example, special economic zones had been established in Fujian and Guangdong provinces in the late 1970s and in the cities of Shenzhen, Zhuhai, Shantou by the end of 1980s. China has transformed many port areas into modern FTZs, and existing ports have equipped themselves with large FTZ areas, providing customers with one-stop shopping services that guarantee both industrial activities and logistics activities in the same place.

In addition, economies in the ESCAP region such as Japan, Singapore, Hong Kong, and Chinese Taipei have already established free trade zones in ports and developed several logistics centres in the FTZs in order to provide value added service and strengthen logistics function of the ports. For example, Yokohama Port Cargo Centre in the Port of Yokohama, Distriparks in the Port of Singapore, ATL Logistics Centre in Hong Kong and several distribution centres in Kaohsiung port were developed for the purpose of strengthening logistics function of the port.

c. Translate the following terms and be ready to explain them in English:

FTZ	IFZ
EZ	transshipment activities
free trade	incentive
SEZ	import substitution
commercial free zone	transportation hub

d. Write synonyms for these words consulting the text:

hub	incentive
to reduce	regulation
investment	employment
innovation	to feature
various	to ensure
to expand	facility

e. Make word combinations consulting the text:

free	activities
transportation	reform
export	incentive
transshipment	zone
tax	market
economic	centre
broad	range
capital	added
trade	port
value	investment
distribution	hub

f. Fill in the gaps with prepositions consulting the text and make your own sentences with the phrases.

1. to develop ­­__ trading activities

2. function __ adjustment __ ports

3. to provide grounds __ market

4. to pattern __ something

5. to be placed __ sales

6. to allow __ creation of hybrid zones

g. Fill in the table with correct word forms.

Verb	Noun	Adjective
		commercial
	limitation
	innovation
	establishment
	investor
equip

Translation

Translate the sentences focusing on the underlined terms.

Carrier and shipper

1. There was an agreement between the shipper and the carrier, concerning contacts between those parties prior to tendering the consignment.

2. Air waybill is made out by or on behalf of the carriers, conforming receipt of the goods by the carrier and evidencing the contract between the shipper and the carriers for the carriage of goods by aircraft.

3. Allotment is as­signed to a carrier or an agent for the purpose of the booking of cargo for a specific voyage.

4. Arrival notice is sent by a carrier to a nominated party advising of the arrival of a certain shipment.

5. Bill of lading evidences a contract of carriage by sea and the taking over or loading of the goods by the carrier, and by which the carrier undertakes to deliver the goods against the surrender of the document.

Delivery

1. Delivery is the process of delivering the consignment to the consignee at the agreed time and place.

2. Goods must be available for transport to the customer on delivery date.

3. Delivery instruction is issued by a buyer giving instructions regarding the details of the delivery of goods ordered.

4. In shipping delivery order is a document issued by or on behalf of the carrier authorising the release of import cargo identified thereon and manifested under a single Bill of Lading.

5. Delivery plan is authorised by the commercial and technical sectors, which states per finished product the quantity per unit of time to be delivered.

Case study

Read the case and discuss the following questions in groups.

1. In what ways would functional organization be an appealing option for structuring Club Med? Product/market organization?

2. How would you describe the current structure of Club Med according to the model of matrix organization?

3. Which factors in Club Med’s situation should be given the most weight in determining formal arrangements for a new organizational design?

4. What are the peculiar or unique factors in the environment of Club Med that may affect its decisions about further organizational design?

Organizing the Structures of Club Med

For twenty years, Club Méditerranée’s headquarters in Paris had much of the flavor of one of the club’s free-wheeling holiday villages. The informal management structure, whereby executives in jeans dropped in and out of the office of the firm’s chief executive, recently gave way to a more strait-laced corporate structure with four regional operational centers covering the globe.

According to chief executive Gilbert Trigano, the change in management style was dictated in part by the club’s continuing spread around the world – a network of resorts that totals ninety installations in twenty-six countries. Another factor pushing the club to reorganize was the brief danger that Trigano might leave Club Med to assist French President. In the old structure, decisions seemed to be made on an ad hoc basis, reflecting Trigano’s personal-management style. Centralization was the rule, to the point where such things as commercial policies to be pursued in the Japanese market or how to run a holiday village in Tahiti were dictated from Paris. An “animator” would fly from Paris to Agadir, Morocco, just to discuss evening entertainment at the company’s Agadir resort.

The need for quick financial decisions in different parts of the globe, the need to adapt rapidly to changing market conditions and to maintain close links between marketing staff and operating personnel at the firm’s resort villages all argued in favor of decentralization. Given the basic uniformity of the company’s resort villages around the world, a geographic divisional structure made more sense than a product-based organizational structure. Under the current structure, the regional directors fly into Paris once a month to review world strategy and to discuss the financing of new villages and problems with tour operators, exchange controls, and the like.

Writing

1. Write a letter of complaint. You ordered 10 boxes of fruits, but when you received the order you noticed that the boxes were damaged and 1 box was missing. You asked an insurance surveyor to examine the packages and he said that the damage was probably due to insecure packing and not to any unduly rough handling of the case. You decided to write to the supplier to explain the case, complain about service and ask for replacement. Write at least 150 words.

2. Write about the following topic: Transportation capacity constraints and the increase in transportation security are transportation management’s problems of higher concern. Do you agree or disagree? Why? Give reasons for your opinion and include any relevant examples. Write at least 250 words.

Culture

Work Ethic and Ethical Work: Distortions in the American Dream⁵⁵

Read the text and discuss the following questions:

1. Do you agree with the phrase “a work ethic is the manifestation of personally held values”?

2. Which is your answer the following question: “As global business intensifies the connections among economies, will the ''American Dream'' serve as a model to emulate, or an example of how a good idea got off track?”

3. What does Ciulla mean by the term “betrayal of work”?

4. What do the authors mentioned in the article think of work ethics?

5. Which points of view mentioned in the article are the most attractive for you? Why?

Generally speaking, a work ethic is the manifestation of personally held values. Every culture has a unique history and set of conditions that influence the meaning given to work in people's lives. The U.S. experience is one of impressive economic accomplishment. Historic tracking attributes this advancement to a successful combination of capitalism with democracy. Further, early capitalism has been described as the linking of two impulses — asceticism and acquisitiveness, which combined effectively only in the presence of a supportive culture and a character structure such as that in early U.S. history. Asceticism refers to rather austere self-discipline, which is often connected to religious beliefs and value placed on non-material rewards. Acquisitiveness is the counterbalancing desire for material goods. The unique culture that developed in early U.S. history supported the balance of these impulses - the desire to have things along with the belief in deferred gratification. Together these factors fed into the democratic ideals adopted for governance.

For future prosperity, perhaps being successful capitalists is not enough, if wealth is accomplished in the absence of important values that balanced the equation during earlier success. The example set by the United States is certainly not a story one can tell without cautionary notes. As global business intensifies the connections among economies, will the ''American Dream'' serve as a model to emulate, or an example of how a good idea got off track?

A three-stage approach is offered here, that may be helpful in answering this question.

First, a deeper look at the evolution of work ethic in America provides some insight to standards of work effort and involvement that have, gradually, become acceptable to the general population. Standards that, in turn, can potentially either support value-distorting deci­sions in an organization, or simply keep people so busy as to not take notice when this is happening. What came to be known as the Protestant work ethic is considered to be a primary factor in the success of capitalism in the United States, so that reviewing the adaptations of that work ethic over time can help with understanding today's work behaviors.

Second, an emphasis on consumerism (acquisitiveness) is reviewed in line with the overall relationship between the individual and the organization, under the heading of ''Returns from the Work Ethic''. Capitalism has altered its form in the past in response to patterns of consumption. Particularly in this democratic society, adaptability encourages individual expression. The public may be signaling the need for another change not yet widely

Third, these factors are re-considered by extracting key messages from the work ethic and exploring two possibilities for distortion. In one variation, people may receive contradictory messages. In their effort to make sense of these contradictions, they sometimes seek the easiest combination, rather than attempting to find resolution that retains the most positive essence of each message. In the second variation, each key message can be taken to a dys­functional extreme, leading to a different type of distortion. These two perspectives combine for some insight as to why people with the same basic work ethic may differ in behaviors related to ethical work.

Ciulla wrote of the ''betrayal of work'' as it is currently being experienced. She believes that work has become a primary source of identity, replacing the fulfillment previously derived from family, friends, and religion. The opportunity to work hard and achieve a better life is a foundation of capitalistic enterprise, but when the process itself becomes the predominant theme in life, people may have reached an unhealthy extreme of that philosophy. According to Ciulla, the prevailing belief that an individual should be able to have everything brings growing frustration. In the midst of rapid change and mushrooming options, people defer to the readily available guidance of marketers and employers — one helps us spend our money, the other lays out rules for how we can get more of it to spend. In this cycle, the return for having a good work ethic is an ongoing push to do even more.

In related discussion, Reich emphasized that today's overabundance of choices creates a volatile marketplace in which companies must constantly update products to meet every whim of the consumer. In turn, each employee trying to excel in the competing organizations must be ever ready to put in the extra effort it takes to meet both internal and external competition. More uncertainty, more competition. More compensation for those who do well but, for the less successful, concerns about the acceptability of a more modest standard of living. ''You don't have to scale the wall, but the consequence of not doing so is harsher; and the reward for doing so is sweeter, than you have ever encountered before''. In considering this new pressure to work harder, it is important to also consider that what it means to work ''hard'' has evolved somewhat. For many (though not all) people, the element of physical labor has been less­ened or eliminated. Hard work now is now typically considered to mean working long hours, intensity of work demands within those working hours, or frequently a combination of both.

Systems in the United States now have a history, and these systems may have become entrenched to the point of making change difficult. The work ethic that drove development throughout that history has evolved to some extent, but it may be showing signs of diminishing returns. Obviously, there is a tension between forces to change and desire to hold fast to important principles. Perhaps the outcry over recent business scandals in the past decade and resulting push for better corporate governance has encouraged a more conscious look at responsibility in both research and practice, includ­ing the beliefs and values society is willing to con­done, as well those that are no longer acceptable. Whether there is enough momentum to carry recent reactions into more thorough guidance remains to be seen.