The problems and issues mentioned in the case Dentex Corporation are:
1. Issue related to corporate social responsibility
2. Issue related to promotional deceiving
3. Issue related to equal opportunity in workplace
4. Issue related to employee responsibility
5. Issue related to bribery
1. Issue related to corporate social responsibility
One of the major issues mentioned in the case is about corporate social responsibility. Dentex Corporation came up with the styling new line of car, Rento. It was considered as a rushed project, thus they skipped preliminary survey. The design was dominated by style different from the other Japanese and European cars, which lead to the placement of fuel tank behind the rear axle (Dentex Corporation, PDF document). The crush test results showed that Rento was less crush resistant and according to Harley Strop, an engineer involved in the crush test mentioned that Rento needed modification before launching (Dentex Corporation, PDF document). The Dentex’s Product Planning Committee and the Vice President, Rodford approved the design and launched it without any modification.
According to moral minimum approach which states that businesses are obliged to maximize profit not by causing harm but it is not constrained by the duty to prevent harm (Corporate social responsibility, Power Point Slides). Though Rodford was informed about the failed test and required modifications, he did not take any initiatives because he did not want to increase costs, as they were competing against the inexpensive European and Japanese cars. Their main target was to be cost effective and maximize profit and they are not causing any harm directly by launching this design. On the other hand, the moral responsibility includes causing harm, enabling harm, allowing harm, providing an opportunity for harm or failing to prevent harm (Corporate social responsibility, Power Point Slides). Here, launching this accident prone car is definitely providing an opportunity for the drivers to get harm, undertaking the modifications would prevent the risk of harm, but the company refused to do so. This is an example of ignorance by the company which resulted the death of Mrs.
Ray and serious injury of Richard.
Considering the utilitarian analysis the audience who will be affected are the customers, employees and management of the company, local community members and the company itself. The impact of this decision on the customers is very dangerous, they might be victims of accidents like Mrs. Ray and her son. The result is serious injury, trauma or death. In case of customers, their life is in risk. The local community members, who will be driving around the defaulted car might be victims of accidents too. Whereas the company itself will be impacted by losing reputation due to the unsafe car, they might lose profit because of lost sales and lastly they might lose money in lawsuits against the accidents. The employees and the management of the company might lose motivation to work in the company, because of the unethical act of the company by being responsible of launching a defaulted car.
Due to the loss in sales and profit, the employees might get reduced benefits. The only pro avoiding modification of Rento from the utilitarian perspective is that the company will make short term profit. The cons can be the risk of customer death or injury, other community members being victim of accidents and in the long term the company will lose reputation and profit and loss of money due to lawsuit payments. The result of the utilitarian analysis states that this is wrong. Here the risk is losing life which has no substitute, whereas profits can be made later or through other sources. Considering the rule utilitarian perspective, if all car companies adapted these unsafe measures people will no longer feel safe in buying cars and driving them along with their children.
The deontological ethics states that there are things that we must do as a matter of principle regardless of consequences (Moral standards, PowerPoint Slides). Here the Vice President, Rodford had to act on the best interest of the company in making profit and surviving the competition against European and Japanese cars. Therefore he ignored the fact of putting people in risk of accidents. The positive right test assists the wellbeing of the company and its employee by making sales and profit. Whereas the negative right test overrides the wellbeing of the customers and the community members with the risk of death. Again since life is irreplaceable and profit can substituted by other means, the action of the company is wrong from the deontological view too.
The policy that Dentex Corporation should follow is strict rules and regulation for the Product Planning Committee regarding product safety. There should be more awareness raised among the employees and management regarding the ethical responsibility towards the customers and society as a whole.
2. Issue related to promotional deceiving
Another issue mentioned in the case is the deceptive advertising. Since the image of Rento was hampered because of the accidents, Dentex decided to develop a manipulative marketing strategy. Their strategy included targeting the young male crowd between the ages of 16 to 24, who can be influenced easily. The experimental researched and focus groups showed that this targeted group is the risk takers thus they created an ad saying “The Little Carefree Car“ (Dentex Corporation, PDF document). This is manipulation of individual’s decision through psychological appeal which exploits instincts, personal motivator, conformity, anxieties and low self-esteem to guide behaviour (Marketing-promotion and placement, Power Point Slides).
Their strategy also included targeting older consumers who care about safety by endorsing the Rento by authority figures. These ads included actors as mechanics and engineers to endorse the Rento by giving it a thumps up and trusting their children with the car ((Dentex Corporation, PDF document). This act is considered as deception of consumers because consumers tends to be convinced by the ad and buy the unsafe car that they would not have bought otherwise.
The utilitarian analysis shows that the affected audience are the company employees and the customers. Through the manipulative advertising the employees will be able to reach their marketing and sales target that will be beneficial for the profitability of the company. Whereas the targeted customer who are manipulated spend their money on the Rento, they bear the risk of accidents and like Mrs. Ray and her son, they suffer from injury and death. The company is solely responsible for this kind of advertising and the consequences. The pros of this act will be the company sales and profit whereas the cons will be the risk of young crowd driving the accident prone car. Thus from the utilitarian perspective the deceiving promotional activities are wrong because of the harmful consequences. The consequence here is about human lives, as mentioned above they cannot be substituted whereas profits can be substituted.
Autonomy is about making rational choice that is undue pressure and manipulation where the choice results from emotional insecurity and social pressure (Marketing-promotion and placement, Power Point Slides). According to the deontological ethics point of view the act violates autonomy by manipulating through psychological appeal. In case of the positive right test, the ads assist the company’s marketing department to reach its promotional goals and lead the company to more profit and sales. Whereas in the negative right test, the ads assist in interfering the freedom of choice through manipulation making them choose the car that is a threat to their lives. Thus due to the risk of life, the promotional deceiving is considered as wrong from deontological perspective.
The management should be well aware of the Canadian Code of Advertising Standards those exist and manage the company accordingly to avoid lawsuits. The standards that imply are Accuracy and Clarity, Testimonial and Ads to Minors (Marketing-promotion and placement, Power Point Slides)
3. Issue related to equal opportunity
Diane Ross, an enthusiastic and hardworking employee of Dentex Corporation made her way up to the important management ranks. She was assigned for a management position of Rento in Mexico, where she had to work under James Carr (The Dentex Corporation, PDF document). The issue here is in front of the Mexican clients James addressed Diane as “cute little assistant” and “our lady manager”, whereas her responsibility was more than what was shown to them. As a result she was bypassed for important matters related to authority (The Dentex Corporation, PDF document). James’s reaction to this matter was that Mexican clients don’t understand women at authority thus he portrays her to be inferior in front of Mexican clients only.
This violates her legal rights, which are rights that are granted to employees by law or judicial ruling (Employee Right, Power Point Slides). It infringes her right of equal opportunity because she is not able to maintain her responsibility and authority that she is entitled to as per her position. On a different perspective this is also violating her moral rights, which are the rights that originate in respect owned to employees as human beings and that are independent of any legal or contractual obligation (Employee Right, Power Point Slides). This infringes her right to fair treatment as an employee because she is just there to show the clients that there is a lady assistant, she is being treated inferiorly.
Considering the utilitarian analysis, the audience of this action are Diane and other female employees of the company. Since Diane is unfairly treated, she will lose her motivation to work for the best interest of the company. She will be stressed during work since there is disturbance in role of authority. She will feel powerless and as a result she might lose self-respect. The consequence for the other female employees might be losing motivation since they are seeing Diane fail despite her ability and hard work. Therefore the pros of this action is James maintaining an image of having a female employee in front of the Mexican clients and the cons is Diane losing motivation and getting worse at her work performance. As a result of the analysis this is considered wrong because it violates her moral rights and effects in deteriorating her ability.
The deontological ethical perspective shows that the action violates Diane’s autonomy by interfering in her work. The negative right test assist in Diane losing her productivity and performance, thus proving the action to be wrong.
The management of the company should be aware of the employee rights to avoid affirmative actions, which refers to policies that take positive steps to alleviate unequal treatment (Discriminations and harassment, Power Point Slides). The company should have information session for executives and management for ensuring fair treatment of employees.
4. Issue related to employee responsibility
Harley Strop, the engineer in charge of the crush test figured that the prototypes do not pass the fuel system integrity safety. When prototypes were struck from behind at 20/mph, the vehicle could not resist that and there was a fuel spillage. At one test, the fuel came to the driver’s compartment due to lack of separation (The Dentex Corporation, PDF Document). Harley mentioned these problems in the test reports and mentioned about the modifications but still the Rento got approved by the Product Planning Committee. The broader stakeholder view states that employees has relationship and responsibilities towards other parties as well rather than only their employers.
The other parties’ in this case is the society, coworkers, professional community and also mainly the customers (Employee responsibility, Power Point Slides). Harley being the engineer (gatekeeper), felt responsible for the defaulted car and informed the Vice President about this matter. As gatekeeper’s lack of expertise puts the public in vulnerable state, they have duty and responsibility to use their professional knowledge for the betterment of the public (Employee responsibility, Power Point Slides).
In view of the utilitarian analysis, the affected audience are the employee (Harley), the customers, the society and the company. Here the engineer, Harley will be demotivated because his professional justifications are overlooked. His skills are being questioned, making him feel like his work is of no value to the company. Also considering his fiduciary duty to the customers, he might feel responsible for risks that the car owners are bearing, though he is powerless in front of the vice president. The customers on the other hand are bearing the risk of accidents affecting them with injury or death like Mrs. Ray and her son.
The society as a whole will be losing trust on engineers and car manufacturers because they are not providing them with safety. Lastly the company will be hampering its image and reputation and might be losing customers. Therefore the pros of this action will be the short term sales and profit but the cons will be employee demotivation, might result in employee turnover and also threat of accident for the customers. As a result of the utilitarian analysis, the act of ignoring Harley’s observation is wrong because of the dangerous consequence. Here the risk is the safety of public, their life is in danger, which is irreplaceable compared to the company’s profit.
According to the deontological analysis the vice president is maintaining his duty and obligation towards the company of maximizing profit, regardless of the consequences. On the other hand, the employee’s autonomy was violated because his accurate report was ignored and not valued. As per the deontological argument managerial employees have expertise on their specific field, such as the engineer which the employer lacks, such as the Vice President. Since the employer’s property depends on the employees, the employees have obligation to look after the interest of the employers (Employee responsibility, Power Point Slide). Therefore Harley was doing the right thing by letting the Vice President know about the flaws, because he is obliged to work for the best interest of the company, its image and performance.
The management should have strict regulations for maintaining safety practise. The Product Planning committee should not be able to approve any project which does not meet the minimum safety requirements. Since gatekeeper build the trust among the company and the customers, their values and judgements should not be overlooked by any under skilled third party.
5. Issue related to Bribery
This issue is related to giving and receiving gift considered as “bribery”. The Rento line had a high demand in Mexico, thus dealers and franchises competed and used unfair means to do business. These gifts ranges from Mercedes Benz to Rolex watch and cash payments of thousand dollars. When Diane was faced with this problem, she was told that it was an accepted way of doing business in Mexico (The Dentex Corporation, PDF Documents).
The utilitarian analysis shows that the affected audience are Diane, the Mexican dealers, the executive in Mexico and the company. Through this from of gifts the dealers get the benefit of being favored and do more business with the company resulting in gaining profit. The executives of the company are receiving expensive gifts and money which result in higher living standard and motivation for better performance. The company overall is meeting its objective of sales and profit. Whereas Diane is not being comfortable adapting the work culture in Mexico.
She is being demotivated and performance is being worse. One of the pro of the gift giving culture is that the executives get motivation to work and their living standard improves. The business is gaining profit and the dealers are getting business. The only con is that Diane’s work performance is deteriorating due to lack of adaptation in the new work culture. As a result of the utilitarian analysis the bribery is causing good to the maximum number of people and just troubling Diane only, so this is not wrong. If Rule utilitarian view is considered, the consequence of adapting this culture in Mexico might hamper its future business because they are being biased to the dealers who provide gifts, rather than using fairs means of trade.
The deontological ethical analysis show that receiving the gifts is not a duty or obligation for the executives. Also it is not overriding anyone’s autonomy. The positive right test assist in better living standard for the executives and also assist the Mexican dealers to do more business. The negative right test only affects Diane’s performance. Therefore, from the deontological perspective this action is right.
As per policy changes, the company should not relocated employees to locations with different work ethics. Here Diane should not have been sent to Mexico, since the work culture is different from America. As a result what she thinks is wrong might be right in Mexican work culture. The company should more focus on recruiting for management positions from local areas rather than overseas.
Petrenko. A. Corporate social responsibility [Power Point Slides]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261
Petrenko. A. Discrimination and Harassment [Power Point Slides]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261
Petrenko. A. Employee responsibility [Power Point Slides]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261
Petrenko. A. Employee rights [Power Point Slides]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261
Petrenko. A. Marketing (promotion and placement) [Power Point Slides]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261
Petrenko. A. Moral Standards [Power Point Slides]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261
Petrenko. A. The Dentex Corporation [PDF Document]. Retrieved from Lecture Notes Online Web site: https://moodle.yorku.ca/moodle/course/view.php?id=39261