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Chapter 12 Video Case Teaching Note Patagonia Teaching Objective: To observe a set of human resources policies and practices that are successful in achieving exceptionally high levels of employee motivation, job satisfaction, and organizational commitment. Video Summary: Patagonia is a unique company that encourages its employees to focus on environmentalism and other social issues about which they are passionate. The employees love their jobs and are devoted to their employer. The company never has to recruit, since it receives about 900 applications for every new hire. This video explores Patagonia’s dedication to quality products and the environment and its human resources policies, such “Let My People Surf,” internships outside the company, and benefits like the corporate childcare center, all of which have led to unusually high levels of employee commitment and customer satisfaction. Questions: 1. What core values are important at Patagonia? How do these core values play an important role in recruiting and retaining top employees? Patagonia’s organizational culture comes from its commitment to the environment, family, and other social issues. The company’s founder and managers believe that in the course of making quality products, the earth comes first and profits are secondary. The company is inundated with résumés from people who share its values, thus there is no need to spend many resources on recruiting. Because employees come to work each day with the attitude that they are making a difference, turnover is extremely low. 2. Why is Patagonia ranked annually as one of the best companies for which to work? Patagonia has created a workplace that helps employees balance the demands of the job, family responsibilities, and their commitment to environmental causes. Workers get generous benefits, including onsite childcare at headquarters. They are given the flexibility to set their own schedules and are expected to go outside and play—using Patagonia products, of course. They also get the opportunity to intern for an environmental group for two months while remaining on the company payroll and to serve on grant committees awarding company-donated funds to environmental activists at the grass-roots level. 3. Why are people a critical component of Patagonia’s success? How do employees help the firm gain a competitive advantage? Patagonia’s success was built on its ability to serve an unmet market need by delivering high quality, innovative products while reflecting the core values of its management, employees, and customers. The employees’ talent, hard work, commitment, and 1 dedication enhance Patagonia’s efficiency, quality, innovation, and responsiveness to customers—the four building blocks of competitive advantage. The employees continually demonstrate Patagonia’s values, which resonate with customers and build strong loyalty. 2