Ethics is a delicate social aspect that managers encounter numerous challenges while trying to implement them at the workplace. Ethical standards are effective if the management endorses a subjective maximizer decision making approach that emphasizes on recognizing other parties’ opinions and social-cultural diversity. Some of the major ethical standards that retail companies are required to obey are quality products and services, employees’ social welfare, and corporate social responsibility.
Mattel manufacturing company faced uproar when it recalled defective toys from customers and suppliers. Recall of toys was a precautionary ethical measure where companies are obliged to ensure that products are of high quality. The management is responsible for overseeing its supply and production process to ensure manufacturers deliver quality products. Despite its ethical initiative to recall the toys, the management had failed to evaluate the production process thoroughly that would have otherwise deterred the problem. Additionally, the company had contravened consumers’ ethical code for quality products. (Bapuji & Beamish, 2008). Consumers form the backbone that supports the sustainability of retail products in the market due to their diverse tastes and preferences. Recall of products is a solution to quality products ethical code because consumers invest their trust on the retailers and thus require quality products.
Implementation of ethical standards should be characterized by collaborative communication style where all parties participate in expressing their opinions rather than unilateral and dictatorial style of management. In the Bangladesh garment industry, reluctance and ignorance of the management resulted in deaths of workers due to non-compliance in employees’ safety standards. The management order to the workers to continue working as the building razed in the fire was non-ethical and inhuman. Additionally, locking of the exit door and erection of grills on the window contravened manufacturing industries’ safety standards (Harris, 2013, December). Manufacturers are ethically obliged to prioritize the social welfare of all workers without bias. In the retail industries, consumers and employees are the victims of high product prices and low wages when retailers embark on improving the quality of products and the employees’ safety standards. Therefore, implementation of ethical standards should involve concerted efforts by all stakeholders in order to ensure Pareto optimality is attained.
Challenges encountered in implementing the Retail industry’s ethical standards and how to overcome them.
It has always been an issue to most companies when they try to maintain a balancing act among consumers, suppliers, shareholders and the employees especially when correcting an ethical defect in the company. Competitive communication style cultivates blame game that eventually jeopardizes the company’s mission and credibility. Consequently, ethical concern remains vague thus promoting continuous ethical breach. In Mattel’s case, Bob Eckert had an ethical obligation to ensure that Early light industry produced quality products and, therefore, should own up responsibility instead of blaming the industry’s employees (Bapuji & Beamish, 2008). Moreover, the ethical dilemma extends to Consumer Product Safety Corporation (CPSC) who is partially blamed for their reluctance to scrutinize the imported products. According to ethical standards, those who contravene ethical codes should be accountable and face the due punishment. In the retail industry, it is difficult to determine the real culprits due to the extended chain of retailers. Another issue is the correction of an ethical defect. In the case of Mattel, recall of toys led to job losses and deterioration of Chinese economy.
The government agencies should be funded adequately in order to enhance oversight on ethical standards compliance and prosecution of those who contravene the set ethical standards. The approach will protect retail industry from successive shift of blame that could risk the company’s market performance. The safety of workers and the production of standardized products shall be safeguarded if government agencies and the companies’ management collaborate in promoting the safety standards of the employees and quality products to the consumers. On another occasion, the principal-agent problem could be another issue that deters impartial implementation of the ethical standards. For instance, Mattel international had a subsidiary from the China that utilized excessive lead in making toys than expected. The situation could have been due to an unscrupulous deal between lead suppliers and Mattel management to procure bulk of their lead at a subsidized price. Additionally, the managers in China subsidiary could be having interest in Mattel’s competitors and thus invest on derailing the competitive advantage of Mattel international. The situation poses an ethical dilemma in Mattel international and the retail industry at large as on the possible approaches to nub the real perpetrators of ethical malpractices.
In the Bangladesh case, the issue is just an isolated case as it portrays the reluctance of the management to value employees’ welfare in favor of the companies’ profitability. Ethically, the social welfare of the employees is the essence of a company’s profitable production and therefore it should precede any other internal ingredient to a company’s productivity. The Wal-Mart management ought to have realized the harsh working conditions of its outsourced company since it is their collective role to uphold the welfare of employees. Additionally, punishment of ethical malpractice should be universal form the managers to the owners, who possess the real powers to monitor the employee’s relation with the executives. Inability to realize these deterrent factors derails the correction of the ethical dilemma for the right direction and thus overlooks the real problem for future occurrence.
In the retail industry, the manufacturers should promote worker safety standards as well as providing quality products to the consumers. In order to enhance the effectiveness, government quality agencies should oversee the full compliance of producing quality products for the safety of the consumers.
Harris, G. (2013, December). Bangladeshi Factory Owners Charged in Fire That Killed 112 - NYTimes.com. Retrieved June 19, 2014, from http://www.nytimes.com/2013/12/23/world/asia/bangladeshi-factory-owners-charged-in-fatal-fire.html?_r=1&
Kavousi, B. (2012, June). Walmart Rejected Proposal To Protect Bangladesh Factories Against Fire: Report [UPDATE]. Retrieved June 19, 2014, from http://www.huffingtonpost.com/2012/12/05/walmart-bangladesh-factory-fire_n_2244891.html
Montopoli, B. (2013, April 26). Bangladesh factory disaster: How culpable are Western companies? - CBS News. Retrieved June 19, 2014, from http://www.cbsnews.com/news/bangladesh-factory-disaster-how-culpable-are-western-companies/
Bapuji, H., & Beamish, P. (2008). Mattel and the Toy recalls(B). Ivey management services.