“Business Cycles and employment practices”

“Business Cycles and employment practices”

Byrne, Keely and Detert, Jim.  “Business Cycles and employment practices in the Garment Industry.”  Business Roundtable Institute for Corporate Ethics.  BRI-1002A (2005).  8 Sept 2008. http://www.corporate-ethics.org.

 

The case involves a small, niche company in the garment industry.  The company has USA-based manufacturing operations and is recognized in the industry for responsiveness and a stylish product offering .  The skill level and high engagement of the production workforce is a significant contributor to the company’s competitive advantage.  The company has historically treated the associates well and has developed an unwritten set of values that includes ‘valuing all associates as partners’.   The company is growing and will need to add production capacity.

 

Prior year company sales were $80M and the forecast for the coming year is $150M (187%).  The increased output is enabled by adding 1,000 workers to a second shift.  Total production employment will thereby increase to 3,000; up 50%.  The initial ramp up of operations is effective and the company is over-producing to the market requirements.   The management team has determined that a 33% reduction in output is required over the winter months to avoid an excess inventory situation.  It is expected , however, that the volume in the spring season will rebound and that the ramped up capacity will once again be required. 

 

The management team needs to develop a revised production plan that will support the company’s financial objectives and comply with their espoused ‘human resource’ values.

 

Questions:

  1. How would you describe the ethical dilemma? 

 

  1. What solutions would you offer the management team that would allow them to be true to their ‘core values’?

DWF

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5 Responses to “Business Cycles and employment practices”

  1. Wende says:

    I am making the assumption that in order to reduce inventory by 33% in the winter months, there has to be a reduction of workers or hours worked. Here lies the ethical dilemma, the company has an unwritten rule of ‘valuing all associates as partners,’ therefore they value decisions that maximize the benefits to all associates and minimize harm – Utilitarianism. The challenge to this thinking is that the rights of the minority group, sewers working fewer hours or let go during the winter months, are sacrificed for the benefit of the majority of associates in order to grow the company.

  2. Wende says:

    In order for the management team to stay true to their ‘core values’ maybe one solution would be to cut back the hours for all the sewers in order to reach needed production in the winter months, and be able to easily ramp up production for the spring season. This would enable the company to keep all of their trained and engaged sewers and support the company’s ‘core value’ of ‘valuing all associates as partners,’ by treating them all equally. The reduction of hours could be spread out among all other associates as well, to meet the financial and ‘core value’ needs in the winter months and to practice what they preach.

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