Given scenario:
A chain of retail store started selling a new product in economy-priced line of clothing endorsed by a famous movie star. For price competitiveness, the store sourced the clothing to low-wage region in parts of region A.
The movie star who endorsed the product complains that clothing as sold with her name printed on it and with appropriate permission. Hearing the news, the person incharge flies to the outsourcing facility to enquire about the problem.
On reaching the city, the person feels highly uncomfortable by seeing and feeling the untidy and poor economic position of the people. The person finds the outsouced facility very clean which is exact opposite to the outside situation and also finds young women are being employed.
The person informs the manager about the sourcing of the company and orders to remove girls under their age of employement. The manager explains about the economic conditions of the city and the obligations of the girls go for a job instead of education. He also says that their daily life bread is based on the income and if the plant is removed their economic conditions will be much worse.
To determine: The explanations to be given to the company, the movie star, the media and the protestors picketing the stores and decide on the options to shutdown the company.
Explanation of Solution
Explanations to be given to the company, the movie star, the media and the protestors picketing the stores and decide on the options to shutdown the company:
It is very difficult choice to satisfy all the parties involved in it but the company can make ethical decision which would impact its profit in short run but would pay long term benefits.
The company can make ethical decision by compromising its profit for a shorter run and making contract with the local players or government to provide education for the underage girls and promising employement at their employment age. This option will impact company but when the actions are marketed properly it would bring high good will towards the firm and also will have good social impact.
The company can explain the situation and making contract with the movie star and they themselves can make clothing in his name which will keep away the protestors coming into play. So, shutting down the plant is not a recommened option for the company.
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Chapter 11 Solutions
Principles of Operations Management: Sustainability and Supply Chain Management (10th Edition)
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