The situation of determining how to handle the recently discovered high lead content in the large whistles order is a difficult one that will in some way affect the company. Three alternatives have been made to allow options for this decision.
Alternative 1: Say nothing; allow the whistles shipment to go without notifying the customer.
Alternative 2: Replace the customer’s order by providing whistles that meet the appropriate company standards.
Alternative 3: Contact the customer and explain the situation, offer them a discount for on the whistles that are lower than the company standard.
Decision Process The process for choosing the three alternatives began by identifying the decision to be made. The decision at hand is what to do with the information discovered about the order of whistles going to a school in South America. This is a big decision that will affect the company in each alternative. The next step of the process is listing options possible for the situation, and then studying those options by listing advantages and disadvantages of each. Then the decision was made by choosing the best overall solution for the decision. And lastly the decision was evaluated to determine if the results were what was expected.
The three options for this decision are listed above; say nothing to the customer, replace the order, or try to make a deal for the customer. Each option is motivated by a result that will benefit the company financially, ethically, or a mixture of both.
The idea behind the alternative 1 decision was to save money upfront and not bother with order changes and other inconveniences for the company. In studying this option the advantage of this would be to save money and time for the company. The disadvantage would be a possibly unhappy customer, an unethical move which could make employees see the company as being unfair; giving a poor product that could be hazardous to children. The legal ramifications of this alternative would be risky if the a child became ill from the use of the whistles and the company was blamed, sued, etc.
The idea behind the alternative 2 decision was to replace the customers order with whistles that are not potentially hazardous and meets the company standards. The advantage of this option is not putting the company in an unethical situation of trying to pass products that are under par for high quality. This will help set a standard of ethics in the company that could motivate employees to do good work. The disadvantage of this option is that it will cost the company $100,000. The financial loss could take a long time to recover from, the positive influence on employees won’t immediately compensate for the loss. There would not be a legal issue with this option.
The idea behind the alternative 3 decision was to try and contact the customer and explain the situation and let them decide if they would like the whistles replaced or to take the hazardous whistles at a discount. The advantage of this alternative is that the customer could decide to keep the original whistles which would still save the company a considerable amount of money cutting the losses to a much smaller amount. Also it would show that the company had the customer’s best interest in mind. The disadvantage of this option is that it could reflect negatively on the company still because we can’t really determine how the customer will feel about the whistles that are potentially hazardous. They customer might think that the company is trying to cut corners and save themselves money. This would be bad for future business. Legally the customer would probably not try and sue the company, but there is still the potential issue of the company being reported as manufacturing products with too high of a lead content. This would kill the company’s reputation and the customer relationships of other clients.
Recommendation Alternative 2 is the recommended decision; replacing the customer’s order by providing whistles that meet the appropriate company standards. This decision was made by both ethical and financial decisions. Ethically this alternative is the most appropriate. The customer contacted the company to provide a product to be used in the South American schools. It would be unethical to provide the customer with a product that is below the company and country standards even though they are not violating the South American standard. The customer chose this company over a foreign company to give a quality and safe product.
This recommendation will positively affect the company because they will possibly become more favorable in the eyes of the customer, with the possibility of more business in the future from them and their business relations.
This option was chosen not only for company recognition, but also to save children from a potentially hazardous experience. This option will be a great cost to the company, but the positive experience from both the customer and employees. By creating a culture of “wanting to do what is right” will help future sales and the company will gradually earn the loss in funds back over time.
Customer relationships Considering the outcome on the customer relationship is an important part of the decision making process. We have to ask ourselves how will the customer feel about our decision, how will it influence them and how will it influence the company? By choosing alternative 2, to replace the whistles, the company will look favorably to the customer, being the school buying the whistles. Though the company will merely be providing the product that was originally agreed upon for the initial sale, the customer will realize that the company is sacrificing to replace the whistles and they will go away with a positive relationship with the company. This experience is sure to foster future business from the customer because of the positive experience they experienced. They will also be more likely to recommend the company to their peers and the company could gain substantial business from the experience.
The children who would be ultimately affected by the quality of the whistles will feel good about receiving a quality, non-hazardous product, and the parents of the children will be grateful knowing that the company behaved ethically. This could also create future business for the company by providing the children and parents with a positive experience from the company.
The company employees will see the standard of ethics portrayed by the company and it will reflect in their work. By giving an example of a high ethical standard it is likely that employees will take greater pride in their work which will affect the company in a positive way. The company’s decision will affect multiple stages of people, their feelings, thoughts, and behaviors will help the company in the long run to regain the loss taken from replacing the whistles. The financial gains will be gradual yet immeasurable in the long run of creating a company with a superior ethical standard.
Social Responsibility In a corporation, social responsibility is behaving ethically as individual workers and together as a company to be sensitive toward social, cultural, economic and environmental issues. This means that the company doesn’t always do what’s best for its self but rather do what is best for their environment, customers, employees, culture, etc.
Social responsibility is a big part of the decision making process because decisions made by the company not only affect the company alone, it affects employees, the economy, the customers, and the environment. These decisions and methods are important when considering long-term business operations.
The decision making process for the situation had many factors involved. The most noticeable factor was the cost of replacing the lower quality whistles with a product that is up to the company’s standard and isn’t potentially hazardous. There was multiple ways of looking the problem; ignoring it, saving the company money and hoping there was not issues with the product, or there was the option to replace the product with something the company could be proud of, a product that had no hazards for use by children, and doing what was appropriate ethically for the situation.
Social responsibility played a major part in the decision to use alternative 2 and replace the order with whistles that didn’t have high amounts of lead. The choice to do what is best for the customer, environment, and the kids of the schools outweighed the option to save the company time and money.