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Solving Ethical Dilemmas: How Ford’s Leadership Achieve A Five Peat

1684 words - 7 pages

Ford Motor Company (FMC) is an American automobile manufacturer with over 100 years industrial experience. Major competitors in the United States (US) include General Motors (GM) and Chrysler Corporation (CC). At the peak of the 2008 global financial crisis, these three automakers faced possible bankruptcy. The Troubled Asset Relief Program (TARP) was created in 2008 by the US government to provide funding for private sector corporations facing bankruptcy. The stated objective of this social intervention was to protect the US economy from devastation.
Horton (2009, p. 221) argued that this type of government intervention in the free market economy has been a historical mistake that ...view middle of the document...

Therefore, they emphasized the benefits of focusing on providing a service to society and building a sustainable business, rather than becoming entrapped with quick cash.
Service to Country
FMC could have accepted the bailout funds. If, FMC had accepted taxpayers money and later were found to have managed the organization poorly or acted unethically as in the case of GM (Modica, 2014), then they would have faced the daunting prospect of pacifying an angry American public. In 2008 hardship was being experienced by all sectors of the American economy. Therefore, FMC’s decision was an indication of their willingness and dedication to serve the American people rather than being a drain on scarce resources. If, FMC had accepted the TARP funds this could have been interpreted that they were not willing to bear their fair share of the recovery process and was looking for an easy way out.
Equity and Fairness
Abrhiem (2012, p. 14) surmised that the magnanimity of justice demands a central focus for the principle of fairness in its contributory role in ethical decision making. The issue of fairness and ultimately equity was therefore well handled by FMC in deciding in not to place the burden of resuscitating their company on the already burdened taxpaying public. Cranston, Ehrich, and Kimber (2006, p. 109) argued that it is paramount importance to ensure that there is equity amongst stakeholder communities. The successes enjoyed by FMC today are a replica of scenario engendered by Henry Ford’s grandson in the late 1940s after World War II (Drucker, 2013, p. 5). FMC started as family business with a value and belief system rooted in seizing the opportunity to remedy social dilemmas with practical business solutions (Drucker, 2013, p. 308). After four generations of Ford’s the belief system espoused by the founder is still alive.
Beliefs and Values
In a knowledge-based economy, the mass media plays a critical role in shaping opinions and values. Rinallo, Basuroy, Wu, and Jeon (2013, p. 437) conducted an international, investigative, empirical study and found that advertisers exhibited significant influence on renowned publishers contrary to popular belief. Bayou and De Korvin (2008, p. 287) used a case study analysis of FMC and GM benchmarked against Honda Motor Company (HMC) and found that FMC outpaced GM by more than 17% in the area of lean manufacturing. Bonini and Kaas (2010) interviewed William Clay Ford Jr. (Executive Chairman) who admitted to the internal struggles he had in transforming FMC into an environmentally friendly company focused on sustainability. It was this same value system and duty to his family’s business that Clay used in 2006 when faced with monumental restructuring challenges to step down and head-hunted a restructuring expert (Alan Mulally) from Boeing (Maynard, 2006).
Obligation versus Duty
Duties refer to your contractual requirements in an organizational setting. Obligations occur where you personally take...

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