Product defect is a serious problem. Doug told me that he had already researched the cost of fixing the defect. To calculate whether it is reasonable to fix the defect, Doug should have calculated the approximate amount of consumers, who could probably be damaged. If the sum of money to refund the damages to the customers is higher than the amount of money spent for fixing the problem, it is reasonable to present a new model for western southern regions of the country. In this case, I would provide the company with a new report that contain all the calculations. While making a decision, I would consider only one question: how high is the probability that every buyer of the bicycle is damaged by the defect?
On the other hand, I should choose a wise tactics. As known, the predecessor was fired because he paid attention to the problem. To avoid the same situation, I would present another report considering the difference of weather conditions in the northern western and southern eastern regions of the country. In the end of the report, I would present possible solutions to the problem, such as branding a new model of the bicycle. I suggest to call the models Zero Pedal SE and Zero Pedal NW.
According to the United States law, it is legal to pay special fee of five thousand dollars and higher to make a good be placed on shelves of a store. However, I would not recommend the company pay such fee. The issue has two sides. On one side, if the sporting goods store is respectful and trusted one, it will become a good advertisement for the company. On the other hand, the Zero Pedal bicycle has many advantages. The company has already spent money for advertising campaign. The customers know already all the benefits of the company. The situation described above showed that the company Green Move tends not to reveal the disadvantages of the product. Hence, in this case, paying additional fee to the owner of the store will be legal but not ethical. The point is that it is unfair to lie to the buyers. Besides, when the problems with bicycles are revealed, the owner of the store will be damaged, as well as the company. Besides, the practice showed that there are many stores willing to have the bicycle on the shelves.
Obviously, the company should apply the analysis. I have already explained above how the defect can affect the company’s reputation. I suggest that such analysis should have been conducted before manufacturing the bicycle. However, the company did not do that. Safety is a rather significant issue when speaking about traffic and vehicles. I suggest that such analysis should be presented in public access on the official web page of the company.
Obviously, there is a high risk of losing customers from the southern eastern regions of the country. However, as I have already proposed earlier, the company should develop two models of the bicycle. Another risk is to decrease the amount of sold bicycles in the northern western regions of the country. The point is that people tend to fear something new. When the company provides the public with the analysis of safety concern, people may panic. Besides, the company may receive several sues concerning the damage. There are many risks to provide the customer with such a report. However, I suggest that ethically it will be the right decision. In such a case, people will think better to buy a defective bicycle, as well as the company developers will think twice of branding a new model of the product.
The issue of international workers, as well as the issue of factories in another country is rather difficult. On one hand, Robert should contact the representative of Solar Group in Bangladesh and talk to him about the working conditions. Besides, I suggest that Robert should send a supervisor to check the working conditions on factories. However, I would not recommend Robert to terminate the agreement. The blogger was not right when contacted Robert. He should have firstly talked to the employees. There are different living and working conditions in different countries of the world. What can seem cruel working conditions for an American are acceptable working conditions for such a young man as Akash. In this case, the interests of Solar Group employees are at stake. The point is that if the agreement between Solar Group and Green Move is terminated, such young men, as Akash will lose their jobs. It has been shown that Solar Group employees are paid well. Moreover, they have career ladder movement. Green Move will soon find a new company to produce solar batteries, whereas Solar Group is less likely to find a new partner.
Robert should apply the working and salary standard of Bangladesh when considering the conform of working conditions and salaries on Solar Group factories. The point is that the factories are located in Bangladesh; hence, the employees there are paid according to the average salary of the country, or to the adjusted salary, the company may propose.
Nowadays, blogs, microblogs or social networks play a significant role in the advertising campaigns of companies. Most people tend to trust Internet more than advertisements in newspapers, magazines or on boards. If the blog is rather popular, people will believe it. Hence, if the blogger posts a link on a video, the reputation of the company will be damaged. Nowadays, there are many movements to protect children’s labor and working conditions in the third world countries. If the activists of such movements see the video, the company may be sued for unfair treatment of employees. On the other hand, the company may post an official letter where the Board of Directors explain the situation in Bangladesh and on the factories of Solar Group in particular. Besides, the company may interview several employees of the factory and post a video with interview on the official web site of the company. This will help to mitigate public’s reaction on the video of the blogger. On the other hand, the best solution is to talk to the blogger before he posts a video. Robert should explain him working and living conditions in Bangladesh.
I do not think that Viktor should provide a bid on the property lease. The main task of every property manager is to sell the area as more expensive as possible. It is not crucial for the company to have the office in an old building. Besides, there is a risk that business in Russia will not be as successful as in the United States of America. Hence, the company will only lose money by buying or landing the office.
Viktor should not include both envelopes. I have already explained why Viktor should not agree to bid. However, if Viktor bids, he should not include the “facilitation” envelope. This envelope means bribery. I suggest that it is a common practice in Russia, but not in the United States of America. The point is that Viktor is Russian. Hence, he may agree to give bribe to the property manager. However, it is illegal both in Russia Federation and in the United States of America. If the company stakeholders know about that fact, they will be unpleased. Besides, it is unethical cheat other members of the competition.
The expansion of operation in Russia can be either beneficial or not for the company. On one hand, the environmental protection tendency is rapidly developing all over the world and Russians will want to have energy safe bicycles. On the other hand, the company will have to conduct an expensive advertising campaign again.
I suggest that the company should wait for quite some time for opening a filiation in Russia. The company is developing and does not have representatives’ offices in all cities of the United States of America. Nowadays, it is risky and not wise expand the operations in other countries of the world. First, the company should become well known and recognized in the home country. The second step is to open online store with international shipping. The next step is to expand operations in other countries of the world, in Russia particularly.
There are several organizational issues, that led to ethical and legal breaches at Green Move. The first issue to consider is the “facilitation” envelope, where Viktor put two thousand dollars. I have already mentioned that it is illegal to give bribes either in Russian Federation or in the United States of America. If someone finds this fact out, the company may be sued for bribery. Another legal issue to consider is the issue of selling defective Zero Pedals.
The ethical issues to consider are working conditions at the Solar Group and the five thousand dollar fee. Besides, leaving defected bicycles is another ethical issue to consider. In all the cases, the reputation of the company is damaged. the company has been established not long ago, hence, it has to have perfect reputation to be noticed and to sell its goods. On the contrary, the company managers and the Board of Directors does nothing to improve the reputation. The company showed the negligence of its employees’ working conditions, as well as its customers’ wellness. Besides, the company showed that the main aim is to get profit and not take care of its customers. I suggest that if the company does not change the tactics, it will fail.
As I have already mentioned, the bribery is the criminal liability in the United States of America and in Russian Federation. The situation that took place in Russia can become a residual risk to the company.
Another issue that can have residual risk to Green Move is the unwillingness of the company to fix problems with Zero Pedals. In the future, the company will have several sues because it did not satisfy customers’ needs and safety. I have already suggested that a new model should be manufactured for the southern eastern regions of the country. The more cases are opened, the more is the probability that the company will have to proclaim bankruptcy and cancel its existence. The more cases are sued, the less customer will the company have.
Short term steps. First, the company should take into account all the advices provided by its employees. It has been mentioned in the beginning that the company tends to fire all those, who see some problems in products. Hence, the company should accept the problems the products have and fix them. Another step to take is to conduct a research on whether it is profitable to fix the defect or pay customers who faced the problem.
Long term steps. The first long term step is to develop a five years business plan. The Board of Directors should not neglect it. The long term business plan will help underline the company’s priorities and see whether it is reasonable to exist for so long. Zero Pedal is a good idea. However, in several years, many other companies, which manufacture such bicycles, will appear. The Green Move should evaluate its abilities and see whether it will be able to survive in the business world. Especially, the company should consider the relevance of Russian filiation. As soon as the business plan is developed, the Board of Directors should understand what step should be taken first and what can come next. Another long term step is to change the place of manufacturing solar systems for bicycles. I have already mentioned that Bangladesh is a good country with cheap working force. On the other hand, the working conditions are not appropriate there. Hence, the company should change either the country or the working conditions of Solar Group factories.
The government plays a significant role in fixing the issues. Government has provided the company with a loan. Hence, the government is responsible for what happens. The government representatives should conduct a meeting with the Board of Directors and ultimate the conditions of fixing the problems. The point is that young owners of the company will definitely take into account suggestions of government representatives. I suggest that the young creators of the company do not fully understand all the responsibility they have. They do not have the understanding that some people in Bangladesh may suffer because of poor working conditions. As well as they do not realize that poor manufactured bicycles can harm someone. governmental representatives are rather respectful, therefore, they can influence the decisions of the creators of Green Move.