Case Session - 8

An Ethical Dilemma
Jon graduated from college with a degree in operations and logistics after he returned from
deployment with the army. His work in the military prepared him well as a manager in operations and
logistics, and it showed when he was hired at AlumaArc, a manufacturing facility that produced various
tank parts for the U.S. Army. Jon’s co-workers and fellow managers at his company respected him for
the proficiency he showed in his work. Within 18 months, Jon became the key person in the logistics
department, and a few months after that, he became one of 20 managers in charge of the third shift.
Above him were two assistant general managers (AGMs) and the general manager. The plant
employed 2,000 general workers and several hundred specialists.
Recently, the U.S. Army asked AlumaArc to step up production. This meant adding another shift with
existing personnel and a number of incentives for increased productivity. At first, Jon was happy with
the new business AlumaArc was getting. However, as he began examining the amount of output
required to meet the army’s expectations, he grew concerned. Even with overtime, the plant would
still find it difficult to meet output goals running at maximum capacity. He also noticed many of the
workers appeared worn out.
Because the plant had heavy equipment that required workers to take safety precautions, it was
standard procedure for workers to review a checklist on a tablet, marking off the different safety
procedures before they began operating machinery. One day, Jon noticed the checklist for his shift
hadn’t been filled out. He asked Jasmine, one of the employees, about why it hadn’t been done.
“Oh, we’ve been so busy lately trying to meet our production quota that George told us we could just
skip it,” Jasmine explained. George was one of the AGMs.
“But these checklists are used to make sure you’re operating everything safely,” Jon responded.
Jasmine looked grim. “Well, if we filled them out, we’d just be lying anyway.” She informed Jon that
to save time, the workers were encouraged to bypass standard safety procedures. Additionally, Jon
was horrified to realize many of the workers were not taking their required breaks in order to get
rewarded for increasing their output.
Later that day, Jon confronted George. “George, these incentives are encouraging careless and unsafe
behaviors. Employees are skipping safety procedures and breaks to get the work done. It’s only a
matter of time before someone gets seriously hurt.”
George looked firmly at Jon. “I realize there are potential risks, but we can’t afford to hire additional
workers right now. If we can just meet this output, it’ll increase our business tenfold. We’ll be able to
hire new workers and pay our current employees more.”
Jon was stunned. “But these are people we are putting at risk!”
George sighed. “Jon, each worker has a choice whether they take advantage of these incentives. They
are not being forced to do anything they don’t want to do. Besides, these are not my rules. The GM
put these incentives in place. It’s out of my control. Just think about it. We’re doing it for the greater
good of our company and our employees.”
Jon replied, “But if they refuse, they are probably afraid they’ll lose their jobs. And even if they do feel
the risks are worth it, isn’t it our job to make sure they have safe work conditions?”
Although George continued to reassure him, Jon left George’s office determined to enforce all safety
protocols and force his employees to take their required breaks. He figured if top management would
not consider the wellbeing of the employees, he would do what he could to protect those who fell
under his authority.
Later that week, George came up to Jon and said, “I’m sorry to tell you this, but your shift is not
meeting the required output levels. We need to meet these deadlines quickly and accurately, and your
shift has always been our fastest. Without you, we’re never going to get the work done on time. That
means we’ll have to start laying off employees who aren’t performing up to expectations.”
Jon recognized George’s veiled threat but refused to compromise his workers’ safety. Meanwhile, he
began hearing stories of employees getting injured on other shifts.
Jon decided to talk to Allie, the general manager. He knew she probably was not pleased with him,
but he felt it necessary to try to persuade her about the dangers of what the company was doing. Jon
wondered how he should approach Allie. If he was not careful, she could fire him. He did not want to
be disrespectful, but he also didn’t want to be a part of a company that knowingly put their employees
in harm’s way.
Questions
1.Describe Jon’s moral dilemma.
2. In AlumaArc’s reasoning, the benefits of increasing production outweigh the risks of potential
injuries. How could this approach potentially backfire?
3. How should Jon approach this issue?

Resolving Ethical Business Challenges
After graduating from Ohio State, Keisha got a job in the marketing and public relations department
at a small soda company called Smith’s Sodas. Smith’s Sodas specializes in high-quality fruit-flavored
soft drinks with unique flavors such as pomegranate, raspberry, blueberry, and coconut. The company
had great plans for the future. In 10 years, Smith’s Sodas wanted to become a competitor to its larger
rivals, Pepsi and Coca-Cola. The company sold sodas with lower calories than its rivals and offered
them in a variety of flavors. However, the product was only half the battle. The rest was up to the
marketing department to promote the sodas as being superior to the competition. Recently, Keisha
was called into her supervisor’s office and assigned a new project. She would take the lead in a
marketing initiative that promoted a new feature meant to appeal to the eco-conscious consumer:
biodegradable packaging. One of the company’s suppliers came up with a soda bottle made with a
new biodegradable plastic manufactured with plant materials. Keisha was told the supplier struggled
to develop this plastic for years, and Smith’s Sodas was staking much of its credibility on developing
an image as an environmentally friendly organization. Keisha immediately began learning about the
plastic and writing up press releases to send to local news stations. She put in long hours working on
a marketing campaign touting the product’s sustainability and how much better it is for the
environment. She stressed the fact that the plastic should be composted, rather than simply thrown
in the trash, to biodegrade properly. A few days ago, Keisha received a call from a local reporter. “I’ve
heard all of the hype concerning these biodegradable bottles your company is using. I wanted to test
just how biodegradable this plastic really is. I contacted scientists at the local university to test its
biodegradability. They tested the bottle under 10 different conditions with different types of soil. Only
four out of the 10 tests resulted in the plastic degrading to any major extent.” When Keisha hung up
the phone, she decided to investigate whether the reporter’s claims were accurate After two days of
phone calls, she finally contacted someone who had been involved in the actual development of the
plastic. “Yes, it’s true the plastic only degrades under certain conditions,” he informed her. “But that’s
still better than a lot of other plastics.” Keisha approached her manager, Louis, to discuss the issue.
Louis did not understand Keisha’s concern. “I don’t see what the problem is, Keisha, other than the
fact that this reporter is trying to cause trouble. As long as the plastic biodegrades under certain
natural conditions, then we are fine.” “Yes, but Louis, our claims made it seem the bottles degrade
fairly easily, when in reality people must compost them. Even then, they only degrade under certain
conditions. Isn’t this a type of greenwashing?” Louis frowned at the mention of greenwashing. “Keisha,
the term biodegradable is vague. We have a supplier, and it is not our responsibility to prove the
packaging is biodegradable. We are not being deceitful, and it is up to the consumer to know how to
dispose of the package so it degrades properly. We can’t control what happens to the product after
the consumer buys it. Many may simply toss it into the garbage.” “What happens if the reporter
publishes her findings?” Keisha asked. Louis looked adamant. “We are not lying when we say the
plastic is biodegradable. Besides, most companies have to rely on supplier claims. I don’t see any
reason why we need to change our marketing claims.”
Questions
1.Are Smith’s Sodas’ marketing claims accurate and truthful?
2. Discuss the justifications Louis uses to argue for the truthfulness of the company’s marketing
claims.
3. Assume there is a news story questioning the sustainability of Smith’s Sodas packaging. How should
Keisha respond?

Case Session - 8

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Case Session - 8

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An Ethical Dilemma

1.Describe Jon’s moral dilemma.

3. How should Jon approach this issue?

1.Are Smith’s Sodas’ marketing claims accurate and truthful?

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