Company Q is an organization working to achieve the goal of generating the most possible profit. The attitude of company Q toward social responsibility however, is an area that needs focused improvement. Based on the description provided the company uses a numbers only approach to decision making. There are intrinsic and fiscal benefits of applying a social philanthropic ethic that should be evaluated. Improvement of company Q’s application of social responsibility could be achieved by developing systems to ensure inventory integrity with community donations, reacting more effectively to the desires of customers, and considering a business model based on more than just profit.
Community giving and charitable donation is another area company Q should focus on. The misguided reasoning for not donating day-old products is a threat of employee theft and fraud. The lost revenue from this threat seems very low. The local food bank approached company ! Requesting donations of food that is discarded anyway. The only potential for employee fraud is lying about products that are fresh and claiming they are day-old. This minor threat could be reduced by management developing and enforcing basic inventory procedures. With this kind of system in place, the only potential threat of unnoticed employee theft would be of food already designated for donation. This type of stealing would be ethically wrong on a personal level for the employee(s) in question. However, it would not result in loss of revenue for the grocery company. Donating food to a local community food bank has inherent value, but there is 3
Social Responsibility and Company Q wider marketing ramification as well. Public perception is a vital component in a company’s success. If the public became aware that company Q has been throwing out food that it had been asked to donate, it could result in a public relations nightmare or consequently profit loss for stockholders. A business that consistently donates goods to a nonprofit organization will present a better image to the public and its customers. Giving away day-old food is an almost costless way of both increasing positive marketing and demonstrating a responsible social ethic.
In the description given it states that company Q recently closed some of its stores due to consistent fiscal loss. It is mentioned that the reason for this franchise reduction is “reported”. The accuracy of this reasoning is certainly suspect. An objective accounting of profit and loss is needed to verify the conclusion reached. Was there meaningful profit loss and was it due to crime? If consistent detrimental revenue loss was indeed a pattern then the stores’ closures should be weighted against the larger goals of the franchise as a whole.
Awareness has increased of the growing problem of urban food desserts. This results in markets dominated by often unhealthy convenience foods and unavailability of fresh healthy food. These food desserts often occur in urban settings that have higher crime rates and low income residents. Re-opening a limited number of stores in these neighborhoods would be intrinsically socially responsible. It would also have the added benefit of creating jobs in these areas and contributing positively to the company’s image.
Company Q grocery stores recently began offering a very small selection of health-conscience and organic products. Strangely, it took years of requests from customers before the grocery chain acted to meet its customers’ needs. The added fact that there is a high profit margin associated with these types of products makes the postponement even more surprising. Company Q needs to improve customer service and retention by responding to consumer needs as this will translate into profit. Consumer demand already exists and the high margin will make sure it is a healthy choice for the company’s bottom line. In addition to generating revenue, stocking healthy products is also socially responsible because it supports healthy lifestyle choices. By focusing on improving response and implementation in meeting consumer needs, company Q can demonstrate social responsibility to customers and stockholders alike.
Recognizing the social responsibility a company has to the community can result in increased profits. At other times an organization should be willing to consider the inherent value in demonstrating an ethic of social responsibility. Company Q has the opportunity to improve its operations in a way that will positively impact both overall profit and the wider community.
Courtney from Study Moose
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