BSN550 Responsible Enterprise

Assignment 2: System Dynamics Mapping

Modern-day slavery in Fashion industry

Introduction:

The fashion industry which entails increasing overproduction of inexpensive clothes

particularly in developing nations due to low production costs and the abundance of labor is

manipulating the industry and in practice of leading high standards of modern slave labor.

Kozlowski (2019) reveals that fashion industry is regarded as amongst the most labor-intensive

industry segments, according to the global slavery exponent, approximately 60 million people

are instantly affected among them and there are approximately 40 million people working in

modern day slavery and supplies chained by western clothing which cater for production

requirements based on the global slavery indicator. Aside from that, fashion industry has been

classified as a leading industry that advocate organizations in modern day slavery, where

situations like poor working conditions, no pay or lower wages, long hours of work overtime,

women at risk of violence and children forced to pick cotton, which are only a few of the key

modern methods in the modern enslavement of Fashion industry (Moulds, 2020).

This article concentrates on current fashion slavery. Wherein, modern slavery might be

described in this sense as a deprival at all points of the supply chain of personal rights and

freedoms (Benstead et al., 2020). In addition, the stakeholder and PESTLE analysis will then be

utilized to develop a casual loop diagram for the determination and identification of system

dynamics the associated actors and factors (Kim, 1994).

Systems thinking overview

Systems thinking is about identification of interactive players, factors and market variables,

information on the results of such interaction, the identification of demands or possibilities to

change connections and have the desired effect (Arnold & Wade, 2015). Also, it is viewed as

an excellent way of gaining additional insights from stakeholders’ point of view, aimed at

showing how the complete entity's ideas link things to one other (Peters & Peters, 2014). Due

to numerous unexpected and unmanageable organizational behaviors in the fashion industry

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it becomes suitable for a non-linear model. Thus, systems thinking will provide more

comprehensive appreciations of why slave labor is related to several components in the

fashion industry through the use and application of system thinking.

System Maps

To talk about dynamic system in the fashion industry, this is an integrated system in which

fundamental characteristic comes from relations among the elements. Also, it could be utilized

to analyze all factors and actors which create modern day slavery. According to Ison (2017)

research shows that, there are some critical components of dynamic system. Firstly, to

evaluate the boundary in the fashion industry which are linked to systems orders where control

measures may be taken. It means to create the boundary that can gain fashion industry’s

knowledge then tackle the problem of modern slavery. Secondly, as the part of connectivity, it

needs to find out factors like the impact and logical dependency depending on the interaction

between components or parts inside the system which explains how suppliers and customers

related components. Lastly, in the emergence part, it needs to find out the elements between

the factors and operational activities which could solve the modern slavery in the fashion

industry completely.

System Analysis of Factors in Modern-day slavery in Fashion industry

Customers

Every business revolves around fulfilling the customer’s needs and wants. Consumers are also

seen as essential stakeholders in the slave business since some of them are also aware of the

modern labor problem in the fashion industry but continue to buy and support brands of

clothes manufactured from modern slave work (Appendix 1). Mainly because the fashion

business changes fast to satisfy the wishes and desires of consumers (Chavan, 2018).

Unfortunately, the fashion industry has been directly linked to so much human trafficking

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because of the demand of low cost — fast fashion. For instance, women are continually

following the fashion trends, which led to certain major brands, such as Forever 21 wanting to

save costs that turns modern-day slavery become furious. It leads to mass manufacturing that

is done as quickly yet inexpensively as possible. What many may not know is that this fashion

supply chain has become a major monetary contributor of modern slavery. Resulting in the

trafficking of both adults and children for forced labor purposes. Therefore, consumers must

be more aware as to whether their decision to purchase is connected with modern day slavery

(The Dunken law firm, 2020).

Employees & Sellers

Employees and sellers are stakeholders affecting slavery in the fashion industry because they

are long-term contributors for organizations. Moreover, the quality of employees and sellers

depend on the training and motivation sessions and promotion opportunities given to them.

Training and growth are essential if we are to achieve a competitive advantage; especially in

Marketing. But if employers are unwilling to invest in the training of their employees or sellers

which cause vicious circle of modern-day slavery (Fashion Revolution, 2019). For example,

organizations exploitation of labor gives them low salary and overtime work, employs boost

production in order to expand its market share by manufacturing more goods at a reduced

price which lead employees into slavery (Appendix 1). Also, if employees and sellers are not

taking enough responsibility for the pay and working conditions in their factories, the

environmental impacts of the materials they use or how the products they make affect the

health of people, animals, and our living planet (Ellie, 2020). Therefore, they must be taken

seriously as they are the main component of a business who contributes significantly to its

success (Chavan, 2018).

Producers

Producers are the persons from whom the material is purchased to make a finished goods and

hence are very important for the organization (Chavan, 2018). A producer’s behavior will

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directly impact the business (Appendix 1). For instance, there are variety of big clothing brand

suppliers, such as Forever21, H&M, Uniqlo and Zara in order to increase clothes’ production

they take their manufacturing overseas to low pay underdeveloped nations and even using

child labor who battle for cheap work to survive and livelihoods (Moulds, 2020). These issues

are particularly happened in Asian federal countries states like Indonesia, Bangladesh and Sri

Lanka (Assoune, 2021). This shows that the pursuit of clothing trends by suppliers will lead to

a further growth in modern slavery.

Government

The character of government is the policymakers (Appendix 1). They make a number of policies,

including pricing, credit policies, education and corporate policies. Consequently, they

establish rules and regulations related to the responsibility of production. As a result, they

stand an important influence in slave labor in the fashion industry. However, it demonstrates

that the government does not have the authority to enact any definitive legislation and

regulations linked with modern-day slavery to alleviate the problem as a whole. Consequently,

a lot of companies do not keep track on marketing programs policy accordingly because the

government has no strong power for strict implementation of laws about slavery in fashion

industry.

Dynamics System Importance

Utilized dynamics system thinking helps to comprehend the fundamental reasons of

contemporary slavery that lead to observable actions or consequences; through knowing

systemic interactions could mitigated without the causes and consequences of systemic

malaise (Kim, 1994). First, lack of state action and weak governance rates will make

manufactories not comply with legislation that causes to bad working conditions, such as

violence, less payment and work overtime. Ethically, employees are viewed as a tool for

company success and their unique requirements are blatantly ignored (Reinikainen, 2005).

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Second, fashion business is full of competitions and rapid changes. Despite of that they keep

workers’ salary decreased while being competitive in the industry. Thus, it increases children

labor compelled to select cotton instead of being in school that causes poverty overall

(Kozlowski, 2019). Lastly, lacking knowledge about the present circumstances of enslavement

could affected on brand reputation and prosecution.

Explanation of the system components

Pressures of costs, competitive settings, fluctuated labor supplies and demand, lengthy supply

chains and indirect procurement could cause modern-day slavery in fashion industry. In

addition, in any supply chain, contemporary slavery is possible: the clothes may be sewn, the

fiber can be converted into yarn or even cotton collected (ourgoodbrands, n.d.). Therefore,

the fashion business is seen as a huge and diversified industry which has wide nature of issues

and the vast stakeholders involved so this contributes substantially to global social and

environmental issues. Although the government emphasized that slavery operations should

be reduced in accordance with its duties (Allinson, 1998). However, increased regulatory

industry perpetuated unethical labor mistreatment by advocating stringent legal standards

which would prevail above the private interests of the sector. (Howe et al., 2019).

Conclusion

Key actors and factors in the business promote the occurrence of modern slavery through a

complicated structure that generates ambiguity in the supply chain, and the necessity for

beneficial choice in a very delicate market (New, 2015). This will cause ethical damage if it will

be continued. To sum up, the purpose of this report is to improve and know how the important

players, variables, causes and implications of slave labor in the fashion industry can be

understood in a system map in order to provide a better overall grasp of how everything is

linked in the (Appendices).

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Appendix 1– Causal Loop Diagram (Systems Map)

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 Appendix 2–Stakeholder Analysis

What is their role in the Why are they involved?

Who are the key Stakeholders?
system? (motivation)
Motivated by desire for
Customers Purchase items from
products and need to fulfill
retailers.
own wants for fashion.
Involved to receive
payment/compensation for
Employed by employers to work.
Employees & Sellers
make garments, do tailors Motivated by profit and
and sell. increasing market share by
offering competitive prices to
consumers (Gold, 2015).
Producers are the persons
from whom the material is
Motivated by the profit-increased
Producers purchased to make a
by the demand of production in the
finished good and hence are
fashion industry.
very important for the
organization.
The Government
departments make several
Motivated by advocating stringent
policies viz. pricing policy,
legal standards which would prevail
Government credit policy, education
above the private interests of the
policy, housing policy, etc.
sector. (Howe et al., 2019).
that do have an influence on
the marketing strategies
(Chavan, 2018)

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Appendix 3–PESTLE analysis (factors):

PESTLE
- Modification of trade agreements.
- Impact of imported clothing and associated exports of
Political goods and taxes
- Modifications of labor laws and norms (ourgoodbrands,
n.d.).
- The higher labor costs lead to higher selling costs for
customers (Baikie, 2020).
- Economic catastrophe like the epidemic that reduces
patterns of human expenditure owing to high
unemployment rates (BT, 2020).
Economic
- The inflation rate may vary considerably.
- Because of the additional complexity of the supply
chain Internationalization can and will not flourish.
(Landman & Silverman, 2019).
- Failure of brands to provide their materials with
transparency (Bhaduri, & Ha-Brookshire, 2017)
- Constant movements and invention in the fashion
business that urge to generate more because of strong
demands for new mode and trends and competitive
prices (Kozlowski, 2019).
Social
- Modern slave labor is more interested in the social
media platforms that make people more aware of the
issue and more aware of their purchasing habits.
- Fast growth and development into new slave labor
markets.

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 - Increased usage of digital technologies like social
networking platforms for different audiences
worldwide (Appel et al.,2020).
- As a new means to distribute online purchasing,
Fashion creates strong demand pressure to
Technological manufacture more at a competitive price.
- Effective marketing techniques through huge fashion
companies to reach the worldwide public and raise
knowledge of new modes and styles that provide
pressure to produce.

- child labor lawsuits and minimum wage charges that

affect the reputation of the brand (Iwanow et al.,2005).
Legal - Workforce legislation as well as fair wages rules, such
as strengthen labor standards for low wage pay
advantage in emerging nations (Moretto et al., 2018).
- The effects of climate change on weather and crop
output, such as cotton, can influence deliveries and
raise costs.
- Impact of the pandemic that affected the productive
Environment
capacity of third world countries.
- Globalizations, by increasing industrial competitiveness
and demand, creates a working people's exploitation
environment (Crane et al., 2019).

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