Preview

Case 30

Good Essays
Open Document
Open Document
701 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Case 30
1. Was the Whirlpool plant closing just another “business decision,” or did it carry with it social and ethical responsibilities and implications? Explain
Whirlpool’s decision to close the manufacturing plant in Evansville, Indiana was a business decision the company made in response to poor sales. The decision most likely pleased shareholders but had social and ethical implications. The plant closure impacted the lives of an entire community. According to the mayor of Evansville, 10,000 jobs will be lost due to the plant closure. Since business ethics is concerned with morality and fairness in behavior, actions, and practices that take place within a business context, this case is a prime example of Whirlpool’s operating strategy of Immoral management. They exploited an opportunity for corporate gain.

2. What are the legal and ethical responsibilities of Whirlpool in a plant-closing case such as the one in Evansville, Indiana?
The legal responsibilities assumed by Whirlpool in a plant-closing case are to comply with all laws and regulations so close the plant, relocate, and honor warranties and guarantees. Since law “often lags behind more recent interpretations of what is considered appropriate behavior,” is can be assumed that Whirlpool’s decision to close the plant and open a plant in Mexico was completely within the confines of the law. Whirlpool is spending $21 million in employee termination costs and has given enough notice to employees to adapt to the changes. The ethical responsibilities in this case are for Whirlpool to do what is EXPECTED of the business by society. Given that the stakeholders had an overwhelming negative reaction to this decision, it can be assumed that Whirlpool did not take into consideration their ethical responsibilities to the stakeholders.

3. In light of the federal stimulus funds that Whirlpool received, did it have a greater responsibility to make the Evansville plant sustainable? Or were the funds received

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Maytag Case Study

    • 494 Words
    • 2 Pages

    The official choice was really required in choosing which venture could be discarded off to fund the Maytag speculations. The choice to offer Aga Food Service and Dixie-Narco Vending Company was really a basic venture choice that must be made by the top administration of Whirlpool Corporation. (Vance, 2003)…

    • 494 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    This paper will show the legality of the activities that happened within United Thermostatic Controls based on federal, state, and local laws. As this case is examined the Sarbanes-Oxley act will be discussed as it played a role in this case because United is a publicly owned company. Also this paper will show the ethicality, if the activities were equitable to internal and external stakeholders, and what is the next step based on everything that has happened. Ethics is something that should always be at the forefront of every decision a company makes because if an unethical act is committed it will come out at some point, and tragic circumstances can come from the act.…

    • 957 Words
    • 4 Pages
    Good Essays
  • Good Essays

    Gscm

    • 799 Words
    • 4 Pages

    Ethical concerns: The code of conduct of the company reputation or avoid consumer protests and boycotts…

    • 799 Words
    • 4 Pages
    Good Essays
  • Good Essays

    This was not only a business decision, but it carried social and ethical responsibilities with it because the company was thinking for the benefit of its shareholders and consumers by making more energy-efficient products while keeping consumer prices fair. By moving the operation to Mexico this allowed the company to do so. But their ethical and social responsibilities to the community and to their employees were not held up due to lay-offs and relocation. Whirlpool did not consider, address, and/or value the impact of the plant closing and how it would affect vendors, suppliers, and the community as a whole. Thus they disregarded the American economy to meet consumer expectations and increase shareholder investments.…

    • 995 Words
    • 4 Pages
    Good Essays
  • Good Essays

    Different people have different understandings of what constitutes ethical behavior. There are laws that help define what is legal and what is not, but the differences between moral ethics are not always clear. These types of moral ethics often lead to ethical dilemmas. According to Trevino & Nelson (2007), “it might surprise many people to learn that there were few laws protecting consumers before the 1960s. At the turn of the last century, consumers didn’t even have the right to sue a manufacturer for defective equipment.” (p. 217) No matter what type of business is run, there are ethical and moral dilemmas attached and in some cases, legal issues arise from unethical-based…

    • 699 Words
    • 3 Pages
    Good Essays
  • Good Essays

    At&T Code of Ethics

    • 879 Words
    • 4 Pages

    A little known fact that I just saw on a trivia show about a month ago dealt with AT&T. I was shocked to find out that AT&T stands for the “American Telephone and Telegraph” company which began around the end of the 19th century. With over a century of technology and personnel changes on every level, the company must be doing something right to still be going so strong after so long. Many companies suffer and eventually file for bankruptcy after too many competitors enter their market. Blockbuster and Hostess both experienced high customer demand for years but eventually went under like so many others. The factors that led up to their demise may have been poor food costs, unexpected expenses, or even deviation from a code of ethics. A company needs a code of ethics to operate efficiently and effectively. One online site states the code of ethics as being “a set of principles of conduct within an organization that guide decision making and behavior. The purpose of the code is to provide members and other interested persons with guidelines for making ethical choices in the conduct of their work” (USLegal Inc., 2013, para. 1).…

    • 879 Words
    • 4 Pages
    Good Essays
  • Better Essays

    legal & ethical

    • 1451 Words
    • 6 Pages

    Read the articles below and analyze the ethical and legal aspects of the actions taken by the cola giants.…

    • 1451 Words
    • 6 Pages
    Better Essays
  • Good Essays

    Etch-a-Sketch Ethics

    • 1311 Words
    • 6 Pages

    The decision to close and move a plant raises important issues about the social responsibilities of a corporation. To make an ethical judgment, one must look at the impact the decision has on various stakeholders. On a macroeconomic level, both the US and China benefited. The US gained lower prices and subsequently an increase in disposable income; poor Chinese villagers gained higher paying jobs and were able to move from the countryside to the city. Social costs to domestic OAC workers were high. The city of Bryan, Ohio, population 8000, lost a key employment base; as a result, a community was destroyed. The former OAC workers were left jobless and had no income stream. They were unable to pay their mortgages, which resulted in many home foreclosures and auctions. Many were forced to leave the town and look for work in other parts of the country. The city lost a steady tax stream. From a business perspective, OAC didn’t break any prevailing laws. OAC’s decision to offshore stemmed from an inability to lower production costs and reverse two years of losses and “sluggish sales” (p160).…

    • 1311 Words
    • 6 Pages
    Good Essays
  • Good Essays

    Hershey Foods Case Study

    • 483 Words
    • 2 Pages

    As the candy market changed and competition increased by 2002 Hershey was forced to come up with a strategic plan. Mars and Nestle had expanded their business in markets beyond candy; however Hershey’s profits are heavily reliant upon their chocolate sales. After taking this into account I can see why the board of directors of HTC was looking for a way to diversify its holdings and find a buyer to get rid of Hershey Foods. However, it appears that they were looking for the easy way out rather than the ethical and more socially responsible solution. This is evidenced by the fact that they did not consult the town in any of their meetings or discuss the issue of an impending sale with community members. I also feel like Hershey and its management did not have the same vision as the founder Milton Hershey. The board directors were not really from the community anymore. Milton Hershey successfully integrated the business with the community and the relationship was one of mutual beneficence. The current leadership was mainly concerned about money and not leadership. Not to say that money is not an important factor, but the special relationship between the survival of the town and Hershey Foods required strong consideration. The Attorney General had it right in declaring that HTC needed to make changes. Still, selling Hershey foods was not the answer.…

    • 483 Words
    • 2 Pages
    Good Essays
  • Satisfactory Essays

    At Whirlpool Corporation, environmental responsibilities are taken seriously. Whirlpool is dedicated to following environmental laws and regulations. They continue to develop innovative products that minimize impact on the environment along with making consumers' lives easier. Whirlpool believes that if laws do not exist or are inadequate, they must establish and follow their own standards consistent with their commitment to being environmentally responsible.…

    • 335 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    Whirlpool’s culture has contributed to its performance in many ways, but most noticeable is the financial gains. “Since 2001, revenues from products that fit the company 's definition of innovative have risen up from $10 million to $760 million in 2005, or…

    • 477 Words
    • 2 Pages
    Good Essays
  • Good Essays

    Whirlpool knows the art of leveraging its wide array of strong brands to serve strategically different & geographically widespread markets. Innovation is Whirlpool Corporation's differentiating strategy giving it a significant competitive advantage. Every Whirlpool Brand aims at understanding the unique consumer needs and converting them into products and services, thus, creating unmatched customer loyalty resulting in high revenue growths and superior return to the global investors. Whirlpool’s revenue has grown by 7.3 % & it has returned $ 502 million to shareholders, during the year ended December 2007.…

    • 293 Words
    • 2 Pages
    Good Essays
  • Best Essays

    Whirlpool Legal

    • 1325 Words
    • 6 Pages

    Whirlpool has a company website that is easy to navigate for all concerned stakeholders, contributing to the transparency of the company. The home page has a clearly visible link in the top right corner to access the product recalls. In January of 2010, Whirlpool launched an easy-to-use rebate finder tool for consumers to be able to locate cash incentives for energy replacement appliances by using their zipcode. For investors, the financial information of the company is not buried but easily accessible with a few clicks. There is a tab on the home page called “Responsibilities” that has drop-down lists addressing all of the CSR aspects of the corporation. This is where all the corporation’s employee policies are listed.…

    • 1325 Words
    • 6 Pages
    Best Essays
  • Better Essays

    Operations at Whirlpool

    • 1710 Words
    • 7 Pages

    Whirlpool launched several initiatives in operations management in the 1990s and early 2000s, the company began restructuring its operations in the early -1990s to orient itself to changing market conditions. As a part of its operational restructuring, the company set up several cross-functional teams for key product areas, entered into several agreements with its suppliers based on their reliability and their ability to assist in product design and began using Electronic Data Interchange (EDI) to communicate with its suppliers.…

    • 1710 Words
    • 7 Pages
    Better Essays
  • Good Essays

    Problem Statement

    • 756 Words
    • 3 Pages

    General Electric and its river pollution problems; GE and Westinghouse’s antitrust action in turbines; WalMart’s aggressive growth strategy and the loss of small town businesses; Wal-Mart and its labor and legal practices; and Wal-Mart with its “Buy America Program.” Now here comes Enron, Arthur Andersen, Global Crossing, Tyco, Martha Stewart, Disney (remember its privacy practices and guest safety issues), Adelphia, Rite Aid, Nordstrom, the dot com bubble, Xerox and its large restatement of earnings, ditto Lucent, and who could forget Krispy Kream donuts? There is a point here. Bad ethics isn’t necessarily new, but there does seem to be more problems that are even bigger today than yesterday. These issues can be national news,…

    • 756 Words
    • 3 Pages
    Good Essays