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The Environment and Corporate Culture 31
31 Chapter 2
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
CHAPTER 2
THE ENVIRONMENT AND CORPORATE CULTURE
CHAPTER OUTLINE
Are You Ready to Be a Manager?
I. The External Environment
A. General Environment
B. Task Environment
II. The Organization–Environment Relationship
A. Environmental Uncertainty
B. Adapting to the Environment
III. The Internal Environment: Corporate Culture
A. Symbols
B. Stories
C. Heroes
D. Slogans
E. Ceremonies
IV. Types of Culture
A. Adaptability Culture
B. Achievement Culture
C. Involvement Culture
D. Consistency Culture
V. Shaping Corporate Culture for Innovative Response
A. Managing the High-Performance Culture
B. Cultural Leadership
ANNOTATED LEARNING OBJECTIVES
After studying this chapter, students should be able to:
1. Describe the general and task environments and the dimensions of each.
The organizational environment consists of all elements existing outside the boundary of the
organization that have the potential to affect and influence the organization. This environment
consists of two layers: the task environment and the general environment.

32 Chapter 2
The task environment is closer to the organization and includes the sectors that conduct day-to-
day transactions with the organization and directly influence its basic operations and

33 Chapter 2
performance such as competitors, suppliers, and customers.
The general environment is the outer layer that is widely dispersed and affects the organization
indirectly. It includes social, demographic, and economic factors that influence all organizations
about equally.
2. Explain the strategies managers use to help organizations adapt to an uncertain or turbulent
environment.
The environment creates uncertainty for organization members. Uncertainty means that
managers do not have sufficient information about environmental factors to understand and
predict environmental needs and changes. Two basic factors that influence uncertainty are the
number of factors that affect the organization and the extent to which those factors change.
Strategies to adapt to these changes in the environment include boundary-spanning roles,
interorganizational partnerships, and mergers or joint ventures.
Boundary-spanning roles are assumed by people and/or departments that link and coordinate the
organization with key elements in the external environment. Interorganizational partnerships are
a popular strategy for adapting to the environment by reducing boundaries and increasing
collaboration with other organizations. A merger is the combining of two or more organizations
into one. A joint venture involves a strategic alliance or program by two or more organizations.
3. Define corporate culture and give organizational examples.
Culture can be defined as the set of key values, beliefs, understandings, and norms shared by
members of an organization. It can be analyzed at three levels. At the surface are visible items,
which include manner of dress, patterns of behavior, physical symbols, organizational
ceremonies, and office layout. At a deeper level are the expressed values and beliefs, which
cannot be discerned from how people explain and justify what they do. These are values that
members of the organization hold at a conscious level. They can be interpreted from the stories,
language, and symbols organization members use to represent them. Some values become so
deeply embedded in a culture that members are no longer consciously aware of them. These
basic, underlying assumptions and beliefs are the essence of culture and subconsciously guide
behavior and decisions.
4. Explain organizational symbols, stories, heroes, slogans, and ceremonies and their
relationships to corporate culture.
Fundamental values and corporate culture cannot be observed directly, but they can be
understood through the visible manifestations of symbols, stories, heroes, slogans, and
ceremonies. A symbol is an object, act, or event that conveys meaning to others. Symbols
associated with corporate culture convey the organization’s important values. A story is a
narrative based on true events that is repeated frequently and shared among organizational
employees. Stories are told to new employees to keep the organization’s primary values alive.
A hero is a figure who exemplifies the deeds, character, and attributes of a strong culture.

34 Chapter 2
Heroes are role models for employees to follow. A slogan is a phrase or sentence that succinctly
expresses a key corporate value. Many companies use a slogan or saying to convey special
meaning to employees. A ceremony is a planned activity that makes up a special event and is

35 Chapter 2
conducted for the benefit of an audience. Managers hold ceremonies to provide dramatic
examples of company values. Organizational culture represents the values, understandings, and
basic assumptions that employees share, and these values are signified by the above events.
Managers help define important symbols, stories, heroes, slogans, and ceremonies to shape the
future.
5. Describe four types of cultures and how corporate culture relates to the environment.
The adaptability culture is characterized by values that support the company’s ability to rapidly
detect, interpret, and translate signals from the environment into new behavior responses. This
culture emerges in an environment that requires fast response and high-risk decision making.
Employees have autonomy to make decisions and act freely to meet new needs, and
responsiveness to customers is highly valued.
The achievement culture is a results-oriented culture that values competitiveness,
aggressiveness, personal initiative, and willingness to work long and hard to achieve results. It is
suited to organizations concerned with serving specific customers in the external environment
but without the intense need for flexibility and rapid change. An emphasis on winning and
achieving specific ambitious goals is the glue that holds this organization together.
The involvement culture places high value on meeting the needs of employees and values
cooperation and equality. This culture has an internal focus on the involvement and participation
of employees to rapidly meet changing needs from the environment. Managers emphasize
values such as cooperation, consideration of both employees and customers, and avoiding status
differences.
The consistency culture values and rewards a methodical, rational, orderly way of doing things.
This culture has an internal focus and a consistency orientation for a stable environment.
Following the rules and being thrifty are important in this culture.
The external environment exerts a big influence on internal corporate culture. Corporate culture
should embody what it takes to succeed in the environment. If the external environment requires
extraordinary customer service, the culture should encourage good service; if it calls for careful
technical decision-making, cultural values should reinforce effective managerial decision
making.
6. Define a cultural leader and explain the tools a cultural leader uses to create a high-
performance culture.
A cultural leader is a manager who uses signals and symbols to influence corporate culture.
Cultural leaders influence culture by articulating a vision for the organizational culture that
employees can believe in, and heeding the day-to-day activities that reinforce the cultural vision.
To create a high-performance culture, a cultural leader would tie the central values that
employees believe in to the need for high performance, and then make sure that work procedures

36 Chapter 2
and reward systems match and reinforce those values. Finally, the cultural leader must be sure to
exemplify high-performance in his or her own work activities.

37 Chapter 2
LECTURE OUTLINE
Are You Ready to Be a Manager?
This questionnaire helps students determine in which types of organizations they might be most
comfortable.
INTRODUCTION
A dominant market position is never guaranteed, even for a company like Blockbuster. Video
rentals were a key aspect of home entertainment for many years and not very long ago
Blockbuster was king of the market. However, mail-order and video-on-demand have
completely changed the video rental market and Blockbuster no longer holds court. Although
Blockbuster now offers mail-order and streaming services, it was too slow to respond to market
changes and lost its influence in the market.
The environment in which companies operate is continually changing, sometimes quite rapidly,
as Blockbuster learned, and managers have to stay on their toes. For organizations in all
industries, environments are increasingly dynamic, requiring managers to be prepared to respond
quickly to even subtle environmental shifts. This chapter explains the components of the
external environment and how they affect organizations. In addition, it examines a major part of
the organization’s internal environment—corporate culture.
I. THE EXTERNAL ENVIRONMENT
INSTRUCTOR’S NOTES

38 Chapter 2
The external organizational environment includes all elements existing outside the boundary of
the organization that have the potential to affect the organization. The environment includes

39 Chapter 2
competitors, resources, technology, and economic conditions that influence the organization. It
does not include those events so far removed from the organization that their impact is not
perceived.
The organizational environment can be conceptualized as having two layers surrounding the
organization: the general environment and the task environment. The organization also has an
internal environment that includes the elements within the organization’s boundaries. It is
composed of current employees, management, and corporate culture.
Business Blooper: British Petroleum Oil Spill
After the worst oil spill in U.S. history, then-CEO of British Petroleum (BP) Tony Hayward
didn’t win any friends on Capitol Hill two months later when he refused to provide details of the
spill, and where he seemed non-chalant about the 760 “egregious willful” violations between
2007 and 2009 from OSHA. Two days later, he was off the coast of England watching his yacht
in a race and spending time with his son, at the same time some 60,000 barrels of oil were still
leaking each day in a disaster that had already cost 11 lives. This was just a year after the
explosion of a BP refinery in Texas in which 15 were killed and hundreds wounded.
Exhibit 2.1: Dimensions of the Organization’s General, Task, and Internal Environments
A. General Environment
1. The general environment represents the outer layer of the environment and will
influence the organization over time, but often is not involved in day-to-day
operations. The dimensions of the general environment include international,
technological, sociocultural, economic, legal-political, and natural.
a. The international dimension represents events originating in foreign countries
and opportunities for American companies in other countries. This dimension
influences all other aspects of the external environment. This provides new
competitors, customers, and suppliers and shapes social, technical, and economic
trends. Today, every company has to compete on a global basis; high-quality,
low-priced cars from Japan have changed the U.S. auto industry. Managers in the
U.S. have been slow to understand issues and competition in foreign countries.
b. The technological dimension includes scientific and technological advancements
in a specific industry as well as society at large. Technology has created massive
changes for organizations and industries. Today, computer networks, Internet
access, videoconferencing, cell phones, and laptops are taken for granted. Other
technology will affect organizations and managers; the decoding of the human
genome could lead to revolutionary medical advances.

40 Chapter 2
Spotlight on Skills: Creating Guanxi in China
With its low labor costs and huge potential market, China is luring thousands of U.S. companies
in search of growth opportunities. However, only one-third of multinationals doing business in
China have actually turned a profit. One reason Western businesses fall short of expectations is
that they fail to grasp the centuries-old concept of guanxi that lies at the heart of Chinese culture.
Guanxi is a supportive, mutually beneficial connection between two people that eventually
grows into a network, and it is through these networks that business gets done. People doing
business in China should remember the following things: business is always personal; don’t skip
the small talk; relationships are not short-term, and; make contact frequently.
c. The sociocultural dimension represents the demographic characteristics, norms,
customs, and values of the general population. Important sociocultural
characteristics are population and geographical distribution, population density,
age, and education levels. Today’s demographic profiles are the foundation of
tomorrow’s work force and customers. Forecasters see increased globalization of
both consumer markets and labor supply with increasing diversity in
organizations and consumer markets.
d. The economic dimension represents the general economic health of the country
or region in which the organization operates. Components of the economic
dimension include consumer purchasing power, the unemployment rate, and
interest rates. The frequency of mergers and acquisitions represents a recent trend
in the economic environment, but there is vitality in the small business sector.
Entrepreneurial start-ups are a significant aspect of the U.S. economy today.
e. The legal-political dimension includes federal, state, and local government
regulations and political activities designed to influence company behavior.
Government regulations influence organizations through a variety of legislation
such as Occupational Safety and Heath Administration (OSHA), the
Environmental Protection Agency (EPA), fair trade practices, and others.
Pressure groups are interest groups that work within the legal-political
framework to influence companies to behave in socially responsible ways. For
example, tobacco companies are feeling the power of anti-smoking groups.
f. The natural dimension includes all elements that occur naturally on earth,
including plants, animals, rocks, and natural resources such as air, water, and
climate. Protection of the natural environment is emerging as a critical policy
focus around the world. The natural dimension is different from other sectors of
the general environment because it has no voice of its own. Influence on
managers to meet needs in the natural environment may come from other sectors,
such as government regulation, consumer concerns, the media, competitors’
actions, and even employees.

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41 Chapter 2
Discussion Question #5: Why do you think that many managers are surprised by environmental
changes and hence are less able to help their organizations adapt?

42 Chapter 2
Exhibit 2.2: 2010 Environmental Performance Index
B. Task Environment
1. The task environment is the layer closest to the organization and includes those
sectors that have a direct working relationship with it. The task environment includes
customers, competitors, suppliers, and the labor market.
a. Customers are those people and organizations in the environment who acquire
goods or services from the organization. Customers are important because they
determine the organization’ success.
Discussion Question #4: Contemporary best-selling management books often argue that
customers are the most important element in the external environment. Do you agree? In what
company situations might this statement be untrue?
b. Competitors are organizations in the same industry or type of business that
provide goods or services to the same set of customers. Specific competitive
issues characterize each industry. The recording industry differs from the steel
industry and the pharmaceutical industry.
c. Suppliers are people and organizations that provide the raw materials that the
organization uses to produce its output. Many companies are using fewer
suppliers and building good relationships with them so that they will receive high-
quality goods at lower prices. These companies are also finding that being
cooperative, rather than adversarial, is the key to saving money, maintaining
quality, and speeding products to market.
d. The labor market represents people in the environment available for hire by the
organization. Labor market factors that impact organizations include:
the growing need for computer-literate information technology workers;
the necessity for continuous investment in human resources through
recruitment, education, and training to meet competitive demands of the
borderless world; and
the effects of international trading blocs, automation, and shifting plant
location upon labor dislocations, creating unused labor pools in some areas
and labor shortages in others.
Discussion Question #2: Would the task environment for a cellular phone company contain the
same elements as that for a government welfare agency? Discuss.

43 Chapter 2
II. THE ORGANIZATION-ENVIRONMENT RELATIONSHIP

44 Chapter 2
Exhibit 2.3: The External Environment of Nortel
Exhibit 2.4: The External Environment and Uncertainty
A. Environmental Uncertainty
1. Environmental uncertainty must be managed to make the organization more effective.
Uncertainty means managers do not have sufficient information about environmental
factors to understand and predict environmental needs and changes. Environmental
characteristics that influence uncertainty are the number of factors that affect the
organization and the extent to which those factors change.
2. When external factors change rapidly, the organization experiences very high
uncertainty (e.g., telecommunications firms, computer firms, and electronics firms).
When an organization deals with a few external factors that are stable, managers
experience low uncertainty (e.g., soft-drink bottlers or food processors).
Discussion Question #3: What do you think are the most important forces in the external
environment creating uncertainty for organizations today? Do the forces you identified typically
arise in the task environment or the general environment?
New Manager Self-Test: Are You Fit for Managerial Uncertainty?

45 Chapter 2
The questionnaire is designed to provide insight into whether a person is better suited for a stable
environment or in an organization with an uncertain environment.

46 Chapter 2
B. Adapting to the Environment
1. Boundary spanning is an increasingly important task in organizations because
environmental shifts can happen quickly in today’s world. Managers need good
information about their competitors, customers, and other elements in the
environment to make good decisions. The most successful companies involve
everyone in boundary-spanning activities.
Exhibit 2.5: The Shift to a Partnership Paradigm
2. Managers in partnering organizations are shifting from an adversarial orientation to a
partnership orientation. Companies are joining together to become more effective
and share scarce resources. Partners are frequently involved in one another’s product
design and production, and they are committed for the long term.
3. Mergers and joint ventures also reduce uncertainty. A merger occurs when two or
more organizations combine to become one. A joint venture involves a strategic
alliance or program by two or more organizations that occurs when the project is too
complex, expensive, or uncertain for one firm to handle alone.
Discussion Question #6: Why are interorganizational partnerships so important for today’s
companies? What elements in the current environment might contribute to either an increase or
decrease in interorganizational collaboration? Discuss.
III.THE INTERNAL ENVIRONMENT: CORPORATE CULTURE

47 Chapter 2
Exhibit 2.5: Levels of Corporate Culture

48 Chapter 2
Spotlight on Skills: Zappos Shoes
Zappos.com, an online retail site best known for its wide selection of shoes and its free shipping,
boldly proclaims its unique culture in an offbeat set of ten core values, including “Create fun and
a little weirdness.” CEO Tony Hsieh believes these core values illustrate the company’s
innovative culture and demonstrate its ultimate business goal—cultivating happiness. Hsieh’s
management theory is that if you create a work culture that fosters well-being, good practices
and (eventually) good profits will naturally flow out of the operation. One way the Zappos
Family of companies perpetuates its unique culture is by hiring employees who will fit into the
slightly wacky, drama-club atmosphere.
The internal environment includes: corporate culture, production technology, organization
structure, and physical facilities. Corporate culture is extremely important in an organization
attempting to achieve a competitive advantage. The internal culture must fit the needs of the
external environment and company strategy.
Culture is defined as the set of key values, beliefs, understandings, and norms shared by
members of an organization. Culture is a pattern of shared values and assumptions about how
things are done within the organization. It can be analyzed at two levels. At the surface level are
visible artifacts—all the things one can see, hear, and observe by watching members of the
organization. At a deeper level are the expressed values and beliefs, which are not observable
but can be discerned from how people explain and justify what they do. Some values become so
deeply embedded in a culture that members are no longer consciously aware of them. These
basic, underlying assumptions and beliefs are the essence of culture and subconsciously guide
behavior and decisions.
A. Symbols
1. A symbol is an object, act, or event that conveys meaning to others. Symbols
associated with corporate culture convey the organization’s important values.
B. Stories
1. A story is a narrative based on true events that is repeated and shared among
organizational employees. Stories are told to new employees to keep the
organization’s primary values alive.
C. Heroes
1. A hero is a figure who exemplifies the deeds, character, and attributes of a strong
corporate culture. Heroes are role models for employees to follow.

49 Chapter 2
D. Slogans

50 Chapter 2
1. A slogan is a phrase or sentence that succinctly expresses a key organizational value.
E. Ceremonies
1. A ceremony is a planned affair that makes up a special event and is conducted for the
benefit of an audience.
Discussion Question #8: Cultural symbols are usually noticed through sight, sound, touch, and
smell. For example, Abercrombie retail stores use music, attractive models, and fragrance to
communicate elements of its retail store culture. Why are symbols important to a corporate
culture?
IV.TYPES OF CULTURE
The external environment has a major influence on internal organizational culture. The internal
culture should embody what it takes to succeed in the environment.
Exhibit 2.7: Four Types of Corporate Cultures
A. The adaptability culture is characterized by values that support the company’s ability to
rapidly detect, interpret, and translate signals from the environment into new behavior
responses. This culture emerges in an environment that requires fast response and high-
risk decision making. Employees have autonomy to make decisions and act freely to
meet new needs, and responsiveness to customers is highly valued.

51 Chapter 2
B. The achievement culture is a results-oriented culture that values competitiveness,
aggressiveness, personal initiative, and willingness to work long and hard to achieve
results. It is suited to organizations concerned with serving specific customers in the

52 Chapter 2
external environment but without the intense need for flexibility and rapid change. An
emphasis on winning and achieving specific ambitious goals is the glue that holds this
organization together.
C. The involvement culture places high value on meeting the needs of employees and
values cooperation and equality. This culture has an internal focus on the involvement
and participation of employees to rapidly meet changing needs from the environment.
Managers emphasize values such as cooperation, consideration of both employees and
customers, and avoiding status differences.
D. The consistency culture values and rewards a methodical, rational, orderly way of doing
things. This culture has an internal focus and a consistency orientation for a stable
environment. Following the rules and being thrifty are important in this culture.
Discussion Question #10: General Electric is famous for firing the lowest-performing 10
percent of its managers each year. With its strict no-layoff policy, Valero Energy believes
people need to feel secure in their jobs to perform their best. Yet both are high-performing
companies. How do you account for the success of such opposite philosophies?
V. SHAPING CORPORATE CULTURE FOR INNOVATIVE RESPONSE
New Manager Self-Test: Culture Preference
The fit between a new manager and organization can determine success and satisfaction. This
exercise helps students better understand which type(s) of organizational culture they prefer.
Research shows that one factor that increases a company’s value the most is people and how they
are treated. Corporate culture has become increasingly important to managers as they recognize
its importance in attracting, motivating, and keeping good employees. Culture plays a key role

53 Chapter 2
in creating an organizational climate that enables learning and innovative responses to threats
from the external environment, challenging new opportunities, or organizational crises.

54 Chapter 2
Exhibit 2.8: Combining Culture and Performance
A. Managing the High-Performance Culture
1. Companies that succeed in a turbulent world are those that pay attention to both
cultural values and business performance. Cultural values can energize and motivate
employees by appealing to higher ideals and unifying people around shared goals.
Values boost performance by shaping and guiding employee behavior, so that
everyone’s actions are aligned with strategic priorities. Four organizational outcomes
are possible based on the relative attention managers pay to cultural values and
business performance.
a. Companies that pay little attention to either values or business results are unlikely
to survive for long.
b. Companies that focus on values but pay little attention to business results are
likely to miss important environmental changes, eventually resulting in loss of
market share.
c. Companies that focus primarily on business results but pay little attention to
organizational values will find it difficult to survive in times of crisis.
d. Companies that emphasize both values and business performance will develop a
strong organizational culture that gives employees a sense of identity, holds the
company together during tough times, and helps it adapt quickly to a changing
environment. These companies represent the high-performance culture that:
is based on a solid organizational mission or purpose;
embodies shared adaptive values that guide decisions and business practices;
and
encourages individual employee ownership of both bottom-line results and the
organization’s cultural backbone.
B. Cultural Leadership
1. One-way managers change norms and values to build a high-performance culture is
through cultural leadership. A cultural leader defines and uses signals and symbols
to influence corporate culture by:
a. articulating a vision for the organizational culture that generates excitement and
that employees can believe in; and
b. heeding the day-to-day activities that reinforce the cultural vision.

55 Chapter 2
2. Managers widely communicate the cultural values through words and actions. Value

56 Chapter 2
statements that aren’t reinforced by management behavior are meaningless. Cultural
leaders also uphold their commitment to values during difficult times or crises.
Maintaining consistency with the cultural values helps organizations weather the
storm and come out stronger on the other side. Cultural leaders let everyone know
what really counts.
Benchmarking: Netflix
Stock analyst Michael Pachter called Netflix a “worthless piece of cr**” in 2005 and said it
would be taken over by Walmart, Amazon, and Blockbuster. Reed Hastings was bothered by
having to pay a $40 late fee for one video and started to think people might join a DVD club the
same way they might join a health club, with monthly fees. That’s how Netflix was born. At
first, no one thought the idea of people renting movies through the mail had any merit, but when
others started offering similar services, Hastings lowered costs, speeded up DVD turnaround,
and improved the computer algorithm to make the experience more personal. The hard-driving,
risk-taking culture Hastings developed at Netflix means he didn’t even balk at the prospect of
cannibalizing the mail-order portion of his own business to introduce the movie-streaming side,
and now Netflix is the market leader in streaming video content.
Answers to Discussion Questions
1. How can you prepare yourself to become an effective manager in an increasingly uncertain
global business environment?
The range of things students could do is quite broad. Some specific things they could do inside
the classroom include learning more about other countries and ethnic groups and their cultures,
studying abroad, learning other languages, engaging in role plays that involve international
settings, and interacting with students from other countries/cultures.
Some ideas for things to do outside the classroom include visiting other countries, taking on
internships in international organizations, hosting exchange students, and attending multicultural
events in the community.
2. Would the task environment for a cellular phone company contain the same elements as that
for a government welfare agency? Discuss.
There are three components of the task environment: competitors, suppliers, and customers. An
analysis of each of these components for the two organizations illustrates the differences in their
task environments.
Competitors for cellular phone companies include not only other cellular phone companies, but
also traditional phone companies, broadband phone services, and other electronic communication
services. It is debatable whether there are competitors for most government welfare agencies.

57 Chapter 2
Churches and other charitable organizations often provide similar services, but do not really
compete with the agencies.

58 Chapter 2
Suppliers of cellular phone companies include the cell phone and other electronic device
manufacturers, investors, and companies that build and operate cell phone towers. Suppliers of
government agencies, in addition to material suppliers, are ultimately the taxpayers.
Customers of cellular phone companies generally include businesses and members of the general
public who are financially sound and able to afford the services offered by the cellular phone
companies. Customers or clients of a government welfare agency are generally persons who are
financially weak.
3. What do you think are the most important forces in the external environment creating
uncertainty for organizations today? Do the forces you identified typically arise in the task
environment or the general environment?
The forces influencing the external environment are competitors, resources, technology, and
economic conditions. The general environment forces include international, technological,
sociocultural, economic, and legal-political dimensions. The task environment includes those
sectors that have a direct working relationship with the organization, among them customers,
competitors, suppliers, and the labor market. Organizations are challenged by uncertainty in the
market place and must be able to respond quickly to changing conditions. These forces impact
management and create uncertainty, especially in the general environment. A manager must be
able to utilize a contingency approach to planning and control events and activities as they
develop.
4. Contemporary best-selling management books often argue that customers are the most
important element in the external environment. Do you agree? In what company situations
might this statement be untrue?
Companies in the public and private sector must be customer driven to remain competitive.
Management and employees must be customer sensitive and custom deliver the right bundle of
utilities to create optimal customer satisfaction. Every organization must have a customer focus
and this should be reflected in the mission, goals, and strategies of every firm.
5. Why do you think that many managers are surprised by environmental changes and hence
are less able to help their organizations adapt?
Managers sometimes do not realize the need to carefully monitor the environment so that they
can anticipate and prepare for changes, and there are also things that happen in the environment
that cannot reasonably be predicted. By definition, uncertainty means that managers lack
sufficient information about the environment to understand and predict needs and changes.
Companies have to make an effort to adapt to the rapid changes in their environments.
6. Why are interorganizational partnerships so important for today’s companies? What
elements in the current environment might contribute to either an increase or decrease in
interorganizational collaboration? Discuss.

59 Chapter 2
Interorganizational partnerships are important for today’s companies to survive and grow in the
future. Sharing information and resources is essential to cost effectiveness and satisfying

60 Chapter 2
stockholders of these organizations. Terrorist activities will add to the need for sharing of
information among the interorganizational companies. Technological advancements will
continue to increase the ease with which interorganizational collaboration occurs.
7. Many companies are “going green” or adopting environmentally friendly business
strategies. Clorox, for example, now offers an eco-friendly household cleaner called Green
Works. How do companies benefit from going green?
As more of their customers become involved in recycling and other environmentally friendly
projects and activities, companies benefit from going green in many ways. They can expand
their product lines, as Clorox did, to take advantage of the growing market for eco-friendly
products. They may be able to reduce costs by using more natural products, or increase revenues
by selling previously discarded materials. Companies may also be able to create goodwill
among consumers by presenting themselves as environmentally aware and concerned.
8. Cultural symbols are usually noticed through sight, sound, touch, and smell. For example,
Abercrombie retail stores use music, attractive models, and fragrance to communicate
elements of its retail store culture. Why are symbols important to a corporate culture?
Symbols are important to corporate culture because they are tangible objects, acts, or events that
embody deeper values shared by organization members. Astute managers create symbols to help
reinforce key values. Almost anything can serve as a symbol. Thus, stories, heroes, slogans, and
ceremonies all serve their own purpose, but also have symbolic value by indicating to employees
the values and understandings that are especially significant for the organization.
9. Both China and India are rising economic powers. How might your approach to doing
business with Communist China be different from your approach to doing business with
India, the world’s most populous democracy? In which country would you expect to
encounter the most rules? The most bureaucracy?
China will have many more rules and much more bureaucracy than will India, as its government
tries to strictly control the activities of foreign businesses, as well as those of its own citizens.
Doing business in India will be considerably easier than in China due, in large measure, to the
greater openness of its society and government. Additionally, there may be less risk of
government interference or even takeover of company facilities and properties in India than there
is in China.
10. General Electric is famous for firing the lowest-performing 10 percent of its managers each
year. With its strict no-layoff policy, Valero Energy believes people need to feel secure in
their jobs to perform their best. Yet both are high-performing companies. How do you
account for the success of such opposite philosophies?
The most likely answer to this question is that, while the companies have very different
philosophies about the impact of employees’ sense of job security, both companies probably
place strong emphasis on organizational values and business performance. Their views about

Exploring the Variety of Random
Documents with Different Content

"The body lay, just as it had fallen
huddled up on the floor, close to the
table." Page 133
"You have had no doctor yet," I exclaimed, turning to the
telephone.
"I ran for my life the instant I discovered what had occurred."

"What is your doctor's name?" I asked as I tried the telephone.
She told me; but I could get no reply to my call. And then I
discovered that the communication had been cut. A sinister and
suggestive circumstance.
I knelt down by the body and made a rapid examination. He
had been stabbed from behind, and was long past all human help.
The eyes were fast glazing and the body beginning to stiffen.
As I was feeling the pulse a ring dropped from the hand, and
intent on the work of examination, I put it without thinking into my
pocket.
"When did it occur?"
"I do not know. I was in my room upstairs and came down to
speak to him about--about my marriage to-morrow----" She paused
and closed her eyes and clenched her hands for a moment, and then
forced herself to continue. "I found him as you see. That was just
before I ran out of the house in my panic and you met me. I
remembered his warning to me and fled. I was mad for the time, I
think."
"What was his warning?"
"It was after you left him this afternoon. Something you said
made him speak to me. He had had a letter threatening his life, and
charging him with treachery; and I was threatened also."
I had been kneeling all this time by the body and now rose.
"You have no idea who can have done this?"
"None. He told me he had an important interview to-night, and
must not be disturbed. That was why I did not come down earlier."
"We must find out with whom," I replied. "And now we must
have the police. Have you nerve enough to fetch them or shall we

go together?"
"Don't leave me."
At that instant as we turned to leave, I heard a sound
somewhere in the house. Hagar heard it also, and clutched my arm
shaking like a leaf.
"You say we are alone in the house?" I asked in a low tone.
She nodded, her eyes strained in the direction of the sound.
We stood listening intently.
"They have come back in search of me," she whispered.
"Then we shall find out who they are. Courage."
I glanced round the room and motioned to her to hide behind
the curtains which covered the deep window recess, and stood there
with her.
Two or three minutes of tense silence followed. Then we heard
footsteps stealthily approaching the room. A pause, and then three
men entered. One a grey-haired, distinguished-looking man well on
in years; the other two younger and of a commoner type, swarthy,
determined-looking men.
From where they stood they could not see the body of the Jew,
and judging by their start at finding the room empty, I judged that
they had expected to see Ziegler at his desk.
Their words confirmed this.
"Not here, the old fox," growled one.
"Come away. Come away," said the elder man, laying his hand
nervously on the arm of one of the others.
"Not till this thing is settled," he replied, shaking off the other's
hand impatiently. "I mean to have the truth out of the old rat, or his
life."

"And the girl's too," added the other. "You know what we were
told about them both. I shall wait for him."
"No, no. No bloodshed, no bloodshed, for Heaven's sake," cried
the old man with a gesture of protest and dismay.
"My God! Look here!" This was from one of the two who had
moved forward and was pointing at the dead body.
The old man gave a cry of horror and sank into a chair covering
his face in his clasped hands.
"What can this mean?"
His companions were standing by the body gazing at one
another in blank wonderment and surprise. Then one of them
stooped down and examined the corpse.
"Dead, sure enough; and murdered, too," he announced.
He rose and they both looked round at the elder man. "Do you
know anything of this?" asked one.
Without a word the man they addressed sprang up and rushed
out of the room.
The two stared at one another again in silence.
Then one of them laughed sneeringly.
His companion winced. His nerves were not so tough.
"What shall we do?" he asked rather huskily. He was beginning
to shake.
"Do? Why, what we came to do, of course. Find the old rat's
daughter and finish the thing," he said brutally, and with an oath.
Hagar was trembling like an aspen and her breath was so
laboured and heavy that I made sure they would hear it.
I pressed her arm to try and reassure her.
"I think we'd better go," said the weaker fellow.

A muttered oath at his cowardice was the response. "I'm going
to search the house," declared his companion, and he began to
glance round the room.
But the other went toward the door. "I'm going."
At this moment Hagar could restrain her terror no longer, and a
heavy half-sigh half-groan burst from her.
Both men turned at once toward the curtains, and the bolder
one put his hand to draw a weapon, knife or pistol; but before he
could get it out, I stepped forward and covered him with my
revolver.
"The Englishman!" they both cried in a breath, and the man by
the door darted out of the room.
His companion stood his ground and met my look steadily.
"So it's your work, eh?"
"Take your hand from that weapon of yours," I cried sternly.
"What quarrel have you with me?"
"Do as I say," I thundered.
He took his hand from his pocket, shrugged his shoulders, and
deliberately turned his back on me and walked toward the door.
His consummate coolness placed me in a dilemma. Shoot him
down in cold blood I could not.
Hagar's courage returned the instant she perceived that the
advantage was on my side. "Don't let him go," she said, and stepped
forward.
The fellow started at the sound of her voice and looked at her
with an expression of the bitterest malignity.
"Stop, you," I cried.

He faced me, laughed again with his former deliberate coolness
and paused as if about to return. "Very well," he said slowly, with a
shrug of indifference; and then, before I could guess his purpose, he
sprang backwards to the door and rushed out.
As a matter of fact I was much relieved by his departure; but
Hagar flew into a passion and reproached me bitterly for having
allowed him to escape. "He murdered my father and will kill me,"
she cried. "You should have shot him."
It was clear from this that her agitation had been too great to
admit of her understanding the purport of what had passed while
the three men were together in the room.
I did not stay to explain matters and let her reproaches pass
without reply. "We must have the police here at once," I said. "You
had better come with me."
We went out to the front door, and seeing a police officer at a
little distance, I called him and told him what had occurred.
He came in with us and made a rapid examination of the dead
man. "He has been dead some time. When did it occur?"
I told him all I knew of the affair: that Hagar had found her
father dead; had fled from the house in fear; had taken me back;
and the cause of our delay in telling the police, adding such a
description as I could of the men.
Of course I quite expected him to suspect us of the deed, and
was not therefore in the least surprised when he replied that we
should be detained.
"You had better go for one of your superior officers," I told him.
"We will remain in the next room."
"I'm not so sure of that," he replied knowingly.

"Then send for some one. You can easily get a messenger in the
street."
I led Hagar into the next room, and he went out and did as I
suggested. Then he came to us, and we waited for the arrival of the
others. Hagar spoke to the officer, but I took no part in the
conversation.
I was completely mystified by the affair. I recalled all the events
of the afternoon. Ziegler's singular hints of treachery; the others'
suspicion of me; the fact of the threatening letter of which Hagar
had told me: and all these things pointed clearly to the conclusion
that the murder had been done by some one who suspected the
Jew, and that it was in revenge we should look for the motive.
But the arrival of the three men, obviously bent upon doing that
which had already been down, negatived any such conclusion
absolutely, or appeared to do so.
That they had expected to find the Jew still alive, there was not
the shadow of a doubt. Their actions had shown this as plainly as
their words had expressed it. They had come to obtain an
explanation of the facts which they held to justify their suspicions;
and in default of that explanation being satisfactory, they were
resolved to take his life.
The words and acts of the eldest of the men had proved that.
The next question was whether their own thought was right--
that some one of their number had anticipated them. It was a
plausible supposition.
But there was another possible theory. The Jew was a man with
many enemies. He had been a hard man, and had been threatened
more than once by those who laid their ruin at his door. He carried

many secrets, too; and it was easy to conceive that there were
hundreds in Berlin who would welcome his death.
Had some such enemy dealt this secret stroke? It was a
question which could only be answered after a strict search into the
hidden undercurrents of his life and business.
To me his death was little short of a calamity. It threatened to
overthrow my whole plans. The suspicions of his good faith
entertained by his companions were almost sure to fall upon me;
and in that case I should assuredly find myself shut out from the
scheme on which I had built so much.
It was this aspect of the affair which concerned me chiefly as
we sat waiting for the arrival of the police, and I racked my wits in
vain for a solution to the problems which it raised.
When they arrived, Hagar and I were subjected to a searching
cross-examination at their hands: she in one room, I in another. I
was questioned very closely as to my relations with Ziegler; and
except that I did not say a word as to the Polish intrigue, I gave as
full and complete an account as possible. I had indeed nothing to
conceal.
I perceived that the questions were directed to elicit any
possible motive on my part which could in any way connect me with
the crime. My replies appeared to satisfy them, and I noticed that
they were compared with the statements which had been obtained
from Hagar.
After the comparison had been made, the manner of the men
questioning me underwent a considerable change. Not a little to my
relief.

"We accept your statement, Herr Bastable; but of course you
will understand that we were compelled to interrogate you closely as
you were found upon the scene of the murder. Now, I invite you to
tell me frankly of any circumstance which you think will tend to
throw light on the matter."
"I am utterly baffled," I replied. "The only guess I can make is
that it may have been the work of some one whose hatred he has
incurred as a money-lender. He must have had many enemies."
"His daughter believes it was the work of the men who came
here afterwards when you were here."
"That is incredible"; and I gave my reasons, adding that Hagar
had been much too agitated to understand what had passed.
"You know that he was associated with the Polish party of
independence. She says so. Will you tell me all you know about
that? Have you any reason to believe that he contemplated
betraying them in any way?"
"None whatever. I knew that he was associated with them. I
learnt that some time ago when I was on newspaper work here in
Berlin."
"I will be frank with you. It has been suggested to us, before
this I mean, that you were associated with him in some such way,
and that that was the cause of your recent visits to him. What do
you say to that?"
This was getting near home with a vengeance. "The only
foundation for such a statement lies in the fact that he had asked
me as a newspaper man, if I could make use of political information
of importance if he obtained it for me. That is of course my
business--provided of course that the information is authentic."

"How was he to obtain it?"
"That I can't say." I used the equivocation intentionally. "I know
I was to pay for it, and to judge of its worth when I knew it."
"How were you to receive it?"
"He was to tell me the time and place and means and
everything. I should of course have used my own discretion in
handling it."
"That lends itself to the fact that he did meditate some sort of
betrayal. I presume the information related to his political
associations."
"I scarcely think so in the sense you imply. More probably
something that would have helped his party. I do not know, as I
have told you, the exact nature of the news, but I gathered of
course that it must affect my own country, seeing that it was as an
English newspaper man he approached me."
"You have taken no other part in these Polish intrigues?"
I smiled. "I am an Englishman, not a Pole; and have no other
feeling in their affairs beyond the natural English attitude toward any
movement which has the liberty of the subject as its motive. But this
was business, you understand."
"One other question. You owed him no money?"
"Not a mark. I never have. I am now a man of considerable
means indeed."
He bowed and lifted his hands to signify that he had finished
with me. "I can go?" I asked.
"Certainly."
"And Fräulein Ziegler? She is in need of a friend and I should
like to help her if she wishes? It is the more terrible for her as she

was to have been married to-morrow."
"Indeed? To whom?" he asked quickly.
I regretted my indiscretion, but it was too late. "To Herr Hugo
von Felsen."
"Ah. That explains. She asked to see him."
"Can I see her?" I asked, and received a ready assent.
I went to her with the mere intention of offering assistance, the
last thing in my thoughts being that a momentous discovery was to
be the result of the interview.
CHAPTER XIV
THE MURDERER
It will be readily understood that at the moment of my leaving the
police official to go to Hagar Ziegler I was in a very unusual mood.
Within the past twenty-four hours I had been within an ace of losing
my life; I had seriously wounded if not actually killed a fellow-
creature in order to escape; I had endured the bitter mortification of
police detention; and had returned to Berlin to take up the thread of
an exciting struggle. And now on the top of all had come the murder
of the Jew, with its consequences of personal hazard to myself and
its disastrous menace to my plans. The examination by the police
had, moreover, been a great strain, and when I rose from it I felt
both nervous and unstrung.
I say this in order to account in some measure for an act which
was altogether foreign to my customary habit, and a paltering and

cowardly hesitation which I have never been quite able to
understand.
I had been treading on very ticklish ground in that part of the
questioning which had related to my connexion with Ziegler's
political associates, and I had been most unpleasantly conscious that
a very little thing would have induced the official to order my
detention. At a time when in Althea's interests my freedom was so
essential, such a result would have been fatal, and the relief with
which I had heard that I could leave the house was indescribable.
This was the predominant feeling as I went to the room to see
Hagar. It was my part to assume indifference, however, and I
plunged my hands into my pockets with every appearance of casual
assurance.
As I did so my heart seemed to stop suddenly; a shiver of dread
chilled me to the marrow; every muscle grew instantly tense and
set; and then with a bound the blood began to rush through my
veins at a rate which set every pulse throbbing violently.
My fingers had touched the ring which I had taken from the
dead man's grasp, the existence of which until that moment I had
forgotten.
In an instant the conviction rushed on me, that if I returned to
the official and gave it him he would refuse to accept my
explanation, would connect me in some way with the crime, and
have me detained if not actually arrested.
The ring was certainly the most important clue; for it was
virtually certain that the owner of it was the man who had done the
deed, and it was my clear duty to hand it over to the police. To
evade that duty would be a piece of paltry cowardice. I realized all

that clearly, but at that moment I was a coward. I was afraid of
being prevented from making any further efforts on Althea's behalf.
And that fear prevailed.
Instead of returning with it to the official, I slipped it on to my
finger and continued my way to see Hagar. It may appear like the
language of exaggeration to say that the ring seemed to burn the
flesh like a band of fire; but my nerves were so high-strung at the
moment, that that was precisely the sensation, and my hand was
trembling like that of a detected thief.
I was a little surprised to find that Hagar had almost entirely
shaken off her former agitation. This had apparently been caused as
much by her fears for her own life as by the horror at her father's
fate; and now that she was safe, she had set herself to the task of
helping the police to the utmost in the work of tracing the murderer.
The police were going to remain in the house, and she had
readily expressed her willingness to stay there also. For this purpose
she had sent for a relative to come and be with her. I concluded that
the police were resolved to keep her under close observation; but
she did not appreciate this fact.
My offers of help were therefore superfluous.
"You have been kindness itself, Herr Bastable. I shall never
forget that I owe you my life. Those men would have killed me, as
they had killed my poor father, had you not been here with me."
"Is there nothing more I can do for you?"
"No; unless you can help me to find those villains. I should
know them again and so would you, I am sure."
"Yes. But I do not think they were guilty of this."

"I know they were. Why else were they here?" she cried. She
was manifestly still holding to what I believed to be a quite mistaken
belief; but I had already given my opinion to the police, and to argue
with her was needless.
"I am going now, Fräulein. There is no message I can take for
you anywhere? Nothing I can do?"
She hesitated, and after a pause said with some sign of anxiety:
"I sent to Herr von Felsen, but he has not come?" and she looked at
me half doubtfully, half questioningly.
"Would you like me to see him?"
"You are not friendly."
"I am your friend, remember that. I will certainly go to him if
you wish."
"Oh, if you would!" she cried, her face lighting with a smile of
gratitude.
"Of course I will," I agreed, and held out my hand.
She was an emotional girl, and instead of merely shaking my
hand she seized it, and was in the act of pressing her lips to it, when
she paused and glanced up in my face with a smile.
"It is a coincidence," she said, still holding my hand.
"What is?"
"Your ring. It is a facsimile of one I gave Hugo."
For an instant the room seemed to reel about me. I knew that
she put her lips to my hand and that it fell listlessly to my side as
she released it. I knew that next she was looking fixedly and with
alarm at some change in my face, and I heard her voice, faint and
as if at a distance.

"You are ill, Herr Bastable. You are white as death. What is the
matter?"
I must have staggered, too, for she put out her hands and held
me.
But at that I made a strenuous effort. "I am all right. This--this
has all tried my nerves. I shall be all right in the air"; and with that I
walked none too steadily out of the house, dazed and thunderstruck
by the sinister truth which her words had revealed with this stunning
suddenness.
As soon as I reached the street I stood for a few moments
breathing deep draughts of the cool air while I sought to steady my
bewildered wits, and then plunged along at a rapid pace.
So it was von Felsen himself who was the murderer. It was all
clear enough to me soon. I could see his wily hand throughout. It
was he who had started the suspicion against Ziegler with hints and
insinuations of treachery dropped stealthily in likely quarters. He had
planned it all as a safe background for the deed he contemplated,
and had probably written the threatening letter with his own hand.
Driven to bay by the old Jew's determination to force the
marriage with Hagar and thus wreck his prospects in every other
direction, he had seen that his only escape lay in Ziegler's death;
and he had been callous enough to select the very eve of the
marriage for the deed.
I recalled what Hagar had said about her father having told her
that he had a very private and important interview that night, and
must not be disturbed. Von Felsen had arranged that easily enough
no doubt from his knowledge of his victim's affairs. He would have

little difficulty, moreover, in getting into the Jew's house and to the
Jew's room secretly; and the rest was easy to guess.
There had probably been a struggle of some sort in which the
ring had been pulled off von Felsen's finger; but he had found his
chance to deliver the death-thrust in the back, and in his unnerved
confusion afterwards he had not missed the ring.
I believed him to be as great a coward as he was a scoundrel,
and at such a moment of crisis his thoughts would be too intent
upon escaping from the scene of his crime to think of anything else.
And now what ought I to do?
As I began to consider this, the thought flashed upon me that
indirectly I had been the cause of the Jew's death. It was my action
in forcing on the marriage which had led von Felsen to this
desperate means of preventing it. I had thrust him into a comer
from which he could see no other means of escape.
How often I had regretted that act of mine! Even Althea herself
had deemed it a mistake.
Regrets were useless now, however. I had to decide what line to
take in view of the fateful proof which had come into my possession.
I had his life in my hands. Was I to use the power to further my own
purposes or to help justice?
I had to a certain extent compromised myself by not disclosing
the possession of the ring to the police before I left the Jew's house,
and the fears which had operated to prevent my doing so had no
doubt been well grounded. But this did not prevent me from seeing
plainly that my duty was to return and state all I knew and give up
the evidence I had.

It was a difficult problem. On the one side there was Althea's
happiness and all I cared for in life; on the other, the satisfaction of
the demands of abstract justice and the punishment of a murderer.
I do not know how another man placed as I was would have
acted, but I could not bring myself to make the necessary sacrifice.
Let those blame me who will, but let them first try to put themselves
in my position.
I resolved to try and use the knowledge I had for my own ends.
There were many difficulties in the way. The deed was not one
which I could use to force the hands of von Felsen's friends. It was
too heinous. They would not dare to attempt to condone it. What I
had sought to obtain was the proof of some act of his which, falling
far short of such a crime as this, would drive them to agree to my
terms in order to save him from exposure and disgrace.
But I could use the power with von Felsen himself to force him
to the commission of such an act; and with this intention I resolved
to go straight to him now, using the message from Hagar as the
reason for my visit.
I should have to act very warily and use the utmost caution in
choosing the moment for showing my power.
I did not find him at his house, and at first this rather surprised
me; but I knew the clubs he belonged to, and set off to make a
round of them. Then I guessed his object. On such a night he would
not dare to be alone; cunning would lead him to do all he could to
be able to account for his time, should suspicion ever point in his
direction.
I found him at the second effort, and sent in my name, saying
that my business was of the greatest importance.

"I must speak to you in private," I told him when he came out
with an assumption of irritation at my interruption of his pleasure.
But it was easy to see that under the surface he was intensely
wrought and uneasy.
"I don't know what you can want with me," he said, as he led
me to a room where we could be alone.
"I have very grave news for you and a message. Herr Ziegler
has been murdered to-night, and his daughter wishes you to go to
her at once."
He had schooled himself carefully to hear the news when it
came. "Murdered? Old Ziegler? Do you mean that, Heir Bastable?"
he exclaimed.
"Certainly. I have just come from there." I kept my eyes on him
closely, watching every gesture and expression.
"Good God!" he cried next, throwing up his hands, as if the
significance of the news were just breaking in upon him. He acted
well, but could not meet my eyes. "Tell me all about it."
"The police will tell you. They are at the house."
"Of course they would be," he said, keeping his head bent.
Then, after a slight pause: "Have they any clue to the thing?"
"Yes. They know who did it."
I spoke very sharply, and the unexpectedness of the reply
startled him out of the part he was playing. He glanced up quickly,
his face pale and his eyes full of fear. "Whom do they suspect?"
"They do not suspect. They know," I replied, emphasizing the
last word.
Alarm robbed him of the power of speech for the instant, "I'm
glad to hear that," he said quite huskily. "Who was it?"

"Some of Ziegler's shady political associates. They were seen at
the house."
His sigh of relief was too deep to escape me; it came straight
from his heart. Before he answered he took out his case and lighted
a cigarette. "By Jove, the news has shaken me up; see how my hand
trembles." Cool, to draw pointed attention to his own agitation.
"It couldn't shake much more if you had done the thing
yourself."
The cigarette dropped from his fingers. "I don't know what the
devil you mean. If it's a joke it's a devilish poor one."
"I was only wondering if you could have been more upset if you
had done it," I replied, fixing him again with a steady stare.
Whether he had any suspicion of what lay behind the words I
do not know, or whether some sense of danger nerved him to make
an effort; but his manner underwent a sudden change, and he
became callous and cynical. "I suppose you writing fellows affect
that sort of experiment. If you can bring yourself down to plain facts
perhaps you will give me some account of the affair."
"I should have thought you would be anxious to get to Fräulein
Ziegler at once in such a case."
He laughed very unpleasantly. "Not if you knew how that girl
bores me."
"You don't mean that you won't go to her?"
"What has it got to do with you?" He was fast recovering his
self-composure. Voice and manner were steadier, as the belief
strengthened that no suspicion would attach to him.
For a moment I hesitated whether to strike the blow which
would bring him to my feet, and my fingers went to the ring in my

pocket. But I resolved to wait. "It has nothing to do with me," I
answered; "but as you are going to marry her to-morrow, and this
blow has come at such a moment, you can understand how she
needs the strength of your support."
"You don't suppose there can be any marriage to-morrow,
surely! Of course the old man's death has altered everything--made
that impossible, I mean."
"It would be like you to desert her at such a time; but she has
all her father's papers, you know, and is not exactly the sort of girl
to stand any fooling."
"She can do what she pleases, and so shall I," he answered
with a shrug and a sneer. "Anyway, she can't be married on the day
after such a thing."
I knew what he meant. He was not afraid of Hagar as he had
been of her father. There would be no marriage if he could avoid it.
"Well, I have given you her message, and if you don't intend to
go to her, it's your affair not mine"; and I turned on my heel.
"You haven't told me how it happened," he said quickly.
I turned for an instant. "You'll hear it all from the police and will
get their theory; and perhaps when you do hear it, you'll take my
view that they are all wrong. I told them so to-night."
I just caught his quick glance of consternation at this as I
swung round and went off. As I was crossing the hall I looked back
and saw him standing leaning against the table in moody thought.
I walked home thinking that the cool air would refresh me after
the strain of the night's events. I was worn out and sorely in need of
sleep.

My sister was waiting for me with a very worried expression in
her eyes.
"I began to fear something had happened again, Paul," she
said.
"Something has happened, Bess; but I can't talk to-night. I'm as
tired out as a hound after a hard day across country. I must get
straight to bed."
"You look awfully worried, dear. Eat something; I'm sure you
need it."
"You girls always seem to think that if a man can only be got to
eat, nothing else matters," I exclaimed fretfully.
"Well, try the prescription now at any rate," she replied with a
bright smile. "And while you eat I have something to tell you."
"If it's anything in the shape of another worry keep it till the
morning; if it will keep, that is."
"I'm afraid it won't, Paul," she said, with such a rueful air that I
could not refrain from smiling.
"Well, I'll take your medicine, if only to please you"; and I sat
down to the dainty little meal she had had prepared. "What is it?"
"Eat something first," she insisted; and began to talk about a
number of insignificant matters.
"Now tell me," I said at length.
"We have another visitor, Paul."
"Another what?" I cried, looking up quickly.
"Althea's father, Paul. The Baron von Ringheim."
"The deuce!"
"I didn't know what to do. I couldn't send him away, and I did
so wish you would come home. He said he was in great trouble, and

begged to be allowed to stay here for to-night at any rate. And he is
in trouble, evidently."
"Where is he?"
"With Althea. They both asked me to send you up to them the
moment you came in."
A pretty complication in truth. A leader of the Polish
Irreconcilables in the house at such a time.
"I'll go to them," I said.
I went upstairs slowly, thinking how on earth to deal with so
unwelcome a crisis. For Althea's sake the thing must be faced and
her father sheltered somehow. But how?
Althea's voice called to me to enter when I knocked.
I opened the door, and then started back in dismay as I
recognized in her companion the eldest of the three men whom I
had seen an hour or two before in the murdered man's house.
For a moment I was literally struck dumb with amazement.

CHAPTER XV
BARON VON RINGHEIM
Baron von Ringheim had been sitting by Althea, and rose at my
entrance and bowed to me with old world courtesy.
"My father, Mr. Bastable," said Althea; and at this he advanced
toward me with hand extended.
I was still under the thrall of astonishment caused by my
recognition, and only the expression of mingled pain, alarm and
surprise on Althea's face enabled me to take his hand and mumble
some formal reply.
He did not appear to notice anything strange in my conduct,
however.
"I have to return you many thanks, sir, for the assistance which
you have rendered to my daughter. She has told me how you have
helped her, and I beg you to believe that I am sincerely grateful."
He said this with an air of great dignity, of patronage, indeed;
almost as if in his opinion the opportunity of helping a daughter of
his was something upon which I might well congratulate myself.
I murmured some sort of reply about having done very little.
"I would not have you belittle your services, Herr Bastable," he
continued in the same indulgent tone. "I and Althea--for she is
entirely with me in expressing this sentiment--are your debtors,
distinctly your debtors. Our family is one of the oldest and highest in
the Empire, and although at the present time we are the subjects of

cruel persecution and have suffered egregious wrongs and
abominable robbery, it shall never be said that we are deficient in
gratitude."
This long and curious speech gave me time to recover myself,
while the look of growing embarrassment and concern with which
Althea regarded him while he was making it recalled to my memory
what she had said of him on a former occasion.
"I beg you to say no more," I replied.
"That is the modesty of an English gentleman, and I appreciate
it," he answered with another elaborate flourish and bow. "I have
heard of you, Herr Bastable, and was assured that I should find a
welcome here. For that also we thank you."
"My father can remain to-night?" asked Althea, as a sort of
aside.
He heard this, however. "To be frank with you, Herr Bastable, I
am in a slight difficulty for the moment. It is some time since I was
in Berlin; as a matter of fact, I am not supposed to be allowed to
come here at all, and if my presence were discovered it might lead
to very serious embarrassment. I shall therefore appreciate it very
highly if you will permit me to ask your hospitality for a while."
"I shall esteem it an honour, Baron."
"Again I beg to assure you that I am extremely grateful."
I had still great difficulty in suppressing the signs of infinite
amazement that this could possibly be the same man whom I had
seen in the company of the two ruffians in the old Jew's house.
"You look very tired and worried, Mr. Bastable," said Althea.
"Bessie has very kindly seen to a room being prepared for my
father."

"I am worn out, and shall ask the Baron to excuse me"; and we
bowed gravely to one another. "But there is a question I should wish
to put before retiring--who spoke so highly of me to you as to induce
you to put this confidence in me to-night?"
"I knew that my daughter was here, Herr Bastable. The
information came from a highly confidential source. But I was
absolutely sure of you."
A glance of appeal from Althea accompanied this courteously
worded roundabout refusal to tell me anything more, so I bade them
good-night and went away. I was indeed so fatigued that even this
strange development, with all the awkward and indeed perilous
complications it threatened, could not keep me awake. I slept
soundly for many hours, and did not awake until late in the morning.
Over my breakfast Bessie gave me her views of the Baron.
"He is a very strange old gentleman, Paul. His room is next to
mine, you know; and I heard him moving about very early, hours
before I got up. And when I saw him afterwards he had forgotten
who I was, and spoke to me as if I were a servant. What do you
make of him?"
"I am probably more puzzled than you are, Bess."
"How did he come here? Did Althea tell him of us?"
"I don't think so. Has she ever said anything to you about him?"
"Has she said anything to you? She did to me, but I don't know
whether she meant me to tell you."
"About the effect of his troubles upon him, you mean?"
"Yes," she nodded rather eagerly. "I suppose he is harmless."
"Oh yes," I said with a smile. "He'll be all right in that respect.
You needn't be scared."

"He has a loaded revolver. He left it under his pillow. Ellen was
nearly frightened out of her life when she fetched me to see it."
"Where is it?"
"He came in for it just as we were both there. He was really
very odd. He had that little bag of his with him and----"
"What little bag? Did he bring any luggage with him, then?"
"Nothing except the little leather bag. Well, he apologized to us,
taking me for one of the servants, as I told you, and declared that
the thing was not loaded--although I am sure it was--and made up a
story that he was accustomed to have it with him just for practice,
and said that we were not to say anything to any one about it; and
then he offered us some money."
"What did you do?" I asked with a grin.
"It's no laughing matter, Paul. Ellen declares she can't stay in
the house if he stops here."
"I'll see to it. But what did you do?"
"You don't suppose we took his money. I told him pretty sharply
he had made a mistake; but he was so polite and seemed so sorry,
that I couldn't be angry. But you'll have to do something, or we shall
lose Ellen."
"Oh, I'll do something. You need not be frightened, nor Ellen
either. So far as I can see, his brain has been affected by his
troubles and persecution, and he is just a mixture of dignified
gentleman and something else; and I'll see that when he is
something else, he will not be able to do any harm."
"Poor Althea is in an awful state about it all. She almost broke
down this morning when speaking to me about it, and you know
what wonderful strength she has. She believes that he will be

arrested here, that some one has betrayed us, and that he has been
sent here merely to get us all into trouble. She intends to take him
away somewhere to-day, I think."
"Well, it is a bit of a mix up, Bess, and that's the truth; but I'll
find a way to straighten things out. You talk to Ellen and put her
right, and if you can't, I'll see her. In the meantime, I'll go and talk
things over with Althea and her father. I was too tired last night."
"Althea wants to see you. She told me so."
"All right. I'll go up to her room as soon as I have thought
matters over."
It was of course quite on the cards that Althea's guess at the
reason for her father's coming to my house was the right one; and it
was certainly a disquieting suggestion. I remembered Feldermann's
hints about my connexion with the Polish party and the questions
put to me on the previous night by the police. If we were found
harbouring a man who was held to be so dangerous as the Baron,
the consequences to Althea and to us all might be really serious.
As to his object in Berlin at such a time, I myself could make a
pretty fair guess. Ziegler had more than once suggested that a
stroke of some sort was to be attempted soon, and the mysterious
hints dropped to me that day in the club by the Polish journalist
prompted the exceedingly disquieting thought that the attempt
might take the form of some kind of violence.
That Baron von Ringheim was in league with the more
desperate section of the party was shown plainly by his having been
with two of them on the previous night at the Jew's house on a
mission of violence. Yet he had obviously gone to the house to
attempt to prevent violence. His protests had proved as much.

So far as I could judge, he had gone there to investigate some
charges of treachery which had been made against the murdered
man; and that von Felsen had intentionally started those suspicions,
and had in some way been instrumental in sending the men to the
house, I was convinced. But why send such a man as the Baron? Did
von Felsen know that he was actually in Berlin--and then a light
seemed to break in upon everything.
It must have been through von Felsen that the news of Althea's
whereabouts had been conveyed to her father, and he had
deliberately contrived that he should arrive at a moment when the
murder had just been committed--apparently by Ziegler's associates.
The moment of all others when the Baron would be in the greatest
need of shelter.
But one of the most perplexing parts of the puzzle still remained
to be solved. What was the precise character of the relationship
between the Baron and the rest of this Polish party? Althea had
suggested that although formerly he had been a real power amongst
them, in later years his authority and influence had ceased.
There had been ample ground in the conduct of the two men
toward him on the preceding night to confirm this, but I must satisfy
myself completely on the point. I was ready, for Althea's sake, to run
the risk of harbouring him; but I was certainly not going to allow
him to use the house for the furtherance of any schemes of his
party, whether violent or not.
I went upstairs, resolved to find this out from himself. I was
fortunate to find him alone in his room. I could talk more plainly to
him alone than when Althea was present.

He had the little bag of which my sister had spoken, and he
gave a little start of surprise and hurriedly shut and locked it. I think
he was rather offended at the abrupt manner in which I entered the
room, and with much the same outward show of old-fashioned
courtesy which he had displayed on the previous night there was a
nervous restlessness which was fresh.
He greeted me with a bow and words of thanks, and for a
moment we played at just being guest and host. But I kept my eyes
fixed steadily on him all the time, and he began to grow exceedingly
uncomfortable under the scrutiny, and at length found himself quite
unable to meet my eyes.
"You must excuse me now, Herr Bastable," he said at length;
and hugging his bag as if it contained all he had in the world, he
made as if to leave the room.
For a second or two I did not reply, but just stared hard first at
him and then very pointedly at the bag.
"I must first ask you one or two questions, Baron von
Ringheim." I dropped the courteous tone and put a spice of
sharpness into my tone.
He noticed it at once and drew himself up, but could not meet
my eyes. "I don't understand by what right you adopt that tone, sir."
"And you will please to answer me quite frankly. Nothing else
will satisfy me or meet the needs of the case."
"This is quite extraordinary."
I pointed at the bag. "You have a revolver there. Why?"
"I decline to be questioned in this tone by you or any one, sir. I
am under an obligation to you for what you have done for my
daughter and now for myself, but this gives you no right----"

"I take the right, Baron. In the first place, believe that I am
wishful to be your friend in every sense of the term, and you may
safely give me your fullest confidence. Your daughter will have told
you that, I am sure."
"My private affairs----"
"Are precisely those which I am determined to know, Baron," I
broke in pretty sternly. I felt that I must dominate him. "This is as
much for your own sake as for your daughter's. Now, please, an
answer."
But he would not answer, and made an attempt to avoid doing
so by a show of anger.
"Tell me then the object of your presence in Berlin?" I said next.
"This is insufferable conduct, sir. Insufferable," he cried.
I should have to hit him harder if I was to do anything with him.
"Tell me then what you were doing at the house of Herr Ziegler just
after he had been assassinated last night?"
The effect was instantaneous. He turned very white, stared at
me for a second and began to tremble violently.
"What do you mean?" he faltered after a pause.
"I was there and saw you, Baron."
He clasped his hands to his face and fell back into a chair.
"Remember, please, that I speak only as a friend. I declare to
you on my honour that I have no motive but to help you. But I must
be told everything. Put yourself unreservedly into my hands, and I
can and will save you; but there must be no half measures. I repeat,
you must tell me everything."
For a long time he was unable to speak a word, and I made no
attempt to force matters. I wished him to recover some measure of

self-control.
"I had nothing to do with that--that deed," he said presently,
speaking in a slow broken tone.
"I know that. I know that the man was dead before you arrived;
but your companions came prepared to do it, and but for my
presence, there would have been a second murder."
"No, no, no," he protested.
"I know what I say to be true, Baron; just as I am convinced
that you went there to protest against any violence at all."
"Ah, you know that. Yes, that is true. I swear that," he cried
eagerly. "I should have prevented it. My authority as leader would
have prevented it. Would to Heaven I had been in time!"
"You have great influence with your associates, then?"
"I am the leader of the whole movement. My word is absolute."
The declaration was made with a singular mixture of pride and
simpleness. It was obvious that he believed it. "You think those men
last night would have obeyed you?"
"They would not have dared to disobey," he replied in the same
tone. "I went there to inquire into a charge of treachery against
Ziegler--that he had betrayed some of our plans to an Englishman---
- Why it was to you, of course." He said this with a little start as if he
had just recalled it. "I was called to Berlin on that very matter."
I began to see light now. Althea was right in one respect--his
mind was so affected and his memory so clouded that consecutive
reasoning was impossible. He was not responsible for either words
or deeds. But there was more behind. Some one was using him as a
stalking horse for very sinister purposes.

"You arrived in the capital yesterday and were told to come to
the house of a man believed to be about to betray your schemes?"
"Yes," he said simply, almost pathetically.
"Can you think of any reason for that?"
"No. I didn't understand it. I forgot until this moment, indeed,
that you were the suspected Englishman."
It was obviously useless to question him any more about that.
"Now, as to this other purpose--the bigger plan of your associates?"
"You know that too?"
"Have I not proved to you that I know things? But I am not a
traitor, Baron."
He smiled childishly. He had become almost like a child, indeed,
now. "It will be a grand stroke against the Government. We shall
destroy the vessel, of course; but there will be no loss of life. I will
not sanction the taking of lives, Herr Bastable."
So this was the scheme. To blow up one of the Kaiser's
warships. I repressed all signs of astonishment and tried to look as if
I had expected the reply. "But you cannot avoid loss of life, Baron."
It proved a very fortunate remark. With a very cunning smile he
looked up and nodded his head knowingly. "I shall not allow it to be
done until I am sure of that. I keep the bomb in my own possession
till then"; and he hugged the little bag closer than ever to his side.
Here was a complication indeed. A lunatic in the house with a
bomb in his possession capable of blowing a warship to fragments.
And this was the man I had described to Bessie as harmless!
CHAPTER XVI

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