One of the major ethical issues in this case study is the fact that Ford company and Bridgestone were both aware of life threatening security concerns about their product offerings but chose to let the issues go unaddressed, leading to a number of accidents, losses of lives as well as the incapacity of many users of their products, something that would have been avoided had the companies taken the least level of responsibility about the safety and well being of their consumers.
As explained in the case study, there was glaring evidence that both Ford and Bridgestone abetted the issue, causing death and suffering to many. More importantly, Bridgestone had invoked certain legal provisions that allowed them to conceal information from the authorities, such as legal suits as a result of their faulty tyres and this enabled them to continue to cause more deaths.
Another major ethical issue relates to the fact that when the first lawsuit was finally made public, Brigdestone took it upon themselves to deny it at the first instance, even without bothering to try and find out the truth of the matter. This goes a long way to indicate that the company did not take safety of the consumer with the seriousness that it deserved, and appeared to put their profitability ahead of customer safety. It was expected that Bridgestone should have left the authorities to conduct their investigations instead of outrightly denying faults in their tires.
Lastly, the ATLA sold a how to sue manual, to the parties who wanted to sue the two companies. This was outrightly unethical, in the sense that it was incumbent of the organization not to directly get itself drawn into the issue, as it was not a respondent in the case. Such an act, is not only unethical, but is not in line with professional ethics.
As explained in the case study, there are various interested parties and stakeholders in this issue, who were either directly or otherwise affected by the activities of these two companies. Key among them and their stakes are as explained below.
Consumers- the case study revolves around the effects that this issue has had to the safety of the consumers. As explained, the consumers were most affected. We are informed of quite a number of fatal accidents that had occurred as a result of the safety issues raised in this case study. Customers, as the major stakeholders should be guaranteed of their safety, and security when they purchase products of these two companies. It was therefore incumbent on the two companies to ensure that their product offerings are of the desired quality, or at least take responsibility for all the accidents that affect others as a result of their faulty tyres or vehicles
In the production chain, suppliers were quite an interested party. They stood to lose big-time in case the two companies cut business links as it happened in 2001. As a result of poor business performance as a result of bad publicity as well as recalling of the tyres, suppliers of both companies risked unpaid supplies as a result of the two company's inability to pay. It was therefore important that the dispute was resolved quickly and amicably so that business can continue as usual, as this would be beneficial to all.
Any government is responsible for the provision of security for its citizens. It was therefore, the enjoined responsibility of the governments to ensure the safety of its people. The widespread accidents were therefore a great concern to the government, as evidenced by the involvement of NHSTA in the dispute resolution process.
The government also benefits from the taxes paid in by the companies involved. Such disputes and bad publicity only serves to reduce the business volumes and by extension the amounts of taxes expected to be paid by these companies since such companies could sometimes go into loss positions as happened to the ones in the case study.
As is explained in the case study, employees are also stakeholders. Bad publicity leading to financial losses are a main cause of job losses. This is because, a company that is expected to pay huge claims and settlements while at the same time struggling to stay afloat as a result of major recall of its products is likely to cut jobs. The closure of the third largest Bridgestone plant led to loss of jobs. A chief executive of firestone also lost his job in the ensuing melee.
As seen in the case study, these two companies do not care much about their customers especially with regard to safety, and that is why they concealed defects in their products at the expense of their customers. It must be noted that no amount of compensation can restore someones life, and therefore, it was expected that the two companies prevented these incidents in the first instance instead of compensating those involved.
3. CSR analysis
An indepth analysis of the two companies conduct with regard to customer safety, and security as well as their public finger pointing instead of addressing the issues that affect the stakeholders indicate that they fall short of the expectations of the stakeholders with regard to corporate social responsibility.
As is evident in the case study, the two companies concealed safety issues and therefore ended up hurting consumers, many of whom lost their lives in the accidents. Their disclaimer and finger pointing with regard to the accidents clearly point at their lacking corporate social responsibility.
4. Who was at fault?
I would think that both Firestone and Ford were both at fault. Firestone was at fault as a result of manufacturing faulty tires, and concealing legal suits from the public while Ford is also at fault for not disclosing the faults noted with Firestone tires, as well as making the Ford Explorer that has been noted and blamed for being faulty. It should be noted that after investigations, it was found that there was internal communication between the two companies that reveal that the companies were aware of the anomalies in their products.
On one side, firestone made tires that could peel like a banana while ford made SUV’s that were unbalanced, and heavy on the tires, leading to a recommendation that the tires should be filled at 26Psi instead of 30psi as recommended by firestone. This explains their collective fault in the case study. In fact, Bridgestone recalled all her tires while Ford replaced all those that were on their vehicles, which clearly indicates their collective responsibility in this issue.
5. Replacing the tyres
It's noted that ford replaced the tyres on their own, without involving the authorities or even Bridgestone. In all respects, firestone should not have paid for this cost, and it did not serve any ethical issue. This is because, it was Fords decision to replace these tyres and since the case was still being handled in court, then at least Ford should have awaited the courts ruling before deciding on their actions. Replacing the tyres was supposed to indicate that actually it’s the tyres that were faulty while in fact, it was found that the Ford explorer was also not well balanced and thus unstable , resulting to rolling in many instances. This therefore explains why firestone should not have been compelled to pay for these tyres.
6. After the incidence
At the initial stages, both companies suffered massively due to bad publicity and safety concerns with regard to their products. Bridgestone for instance had to close the third largest production plant as a result of reduced business, while Ford had to make major improvements in the Ford Explorer, so as to address the rolling over safety issues raised in the investigations (www.ford.com.)
At the present, both Ford and Bridgestone seem to have left the events of the tyre separation controversy behind. Although the incident was quite draining in terms of public relations and investor confidence for both companies, they have come back to their feet and are doing just fine in their businesses (David Welch,2008).
A close look into the financial performance of both Ford and Bridgestone reveals that although they no longer cooperate after the unfortunate incident, they have continued to produce robust financial performance especially after the final settlement of the legal obligations in 2006.
Both companies have fought hard to redeem their images by improving on the safety of their products, diversification as well as playing a pivotal role in community activities so as to redeem their once coveted image as leading contributors in social responsibility (www.bridgestone.com).
7. Lessons learned on product safety, business ethics, issues management
The preceding case study provides important lessons with regard to product safety, business ethics as well as issues management in the corporate arena. As is evident, product safety should never be compromised at whatever cost, especially where the lives of consumers is involved, as it not only leads to losses of life, but can also result to huge litigation settlements, which are likely to weigh down on the companies involved,therefore, such should be of paramount importance so as to ensure that lives of consumers are safeguarded.
As pertains to business ethics, this cannot be overemphasized from the case study above. Companies should put the interests of the consumers before their own selfish interests if they are to stand the test of time. Its also imperative that organizations act in the best interest of their consumers, and avoid any actions or omissions that would be considered to be unethical in the eyes of their consumers and stakeholders as this would be considered to be detrimental to their survival.
Dispute resolution and issues management should be resolved amicably, especially in the corporate arena. Washing dirty linen in public has been found to be detrimental to the companies public outlook and this has a negative impact on investor confidence, customer loyalty as well as industry.
Toyota motor company has a lot to learn from the incidence in its recent motor faults and recalls so as to ensure that she does not fall victim of the corporate woes that befell Ford and B.In fact, idgestone.Toyota should admit liability and compensate the affected so as to restore customer confidence in her products and avoid learning the hard way as was the case with both Ford and Bridgestone.
The Ford Motor Company Website: www.ford.com
The Bridgestone company website: www.bridgestone.com
David Welch, ‘‘Meet the new face of Firestone’’,business week,2008
Associated press ‘‘ Bridgestone and Ford settle dispute over defective tyres’ The newyork times,2005