Strategic Management

CASE 1: RECALCITRANT DIRECTOR AT BYTE PRODUCT, INC.: CORPORATE LEGALITY VERSUS CORPORATE RESPONSIBILITY

Introduction

Bytes Product Inc is the largest manufacturer of electrical components. High demand for these components causes them to add the manufacturing plant to accommodate the high number of demand. The plant requires 3 years to complete. Therefore they need other alternatives over a 3-year. The alternative was to give licenses bytes products and technologies to other manufacturing companies in the U.S., utilize overseas facilities and licenses but rejected by Mr. James Elliot, CEO and Chairman of Byte Product, Inc. Mr. James Elliot proposing to purchase the existing plant in Plainville as temporary plant until the new plant is completed. Plainville been abandoned for 8 years and takes three months to repair. Majority of members agreed with the proposal except Kevin William, board member. Then there was a discussion between Kevin William and James Elliot who discuss the impact of 1200 potential employees and the town if opening the temporary plant at Plainville. After the discussion the vote was change which is 7-4 or 6-5 for the proposal. William say that “I have to say no” when James Elliot asked whether a compromise can be reached.

Case analysis

The main issue of this case is about the strategic decision making of Board of Director whether they need to open the temporary plant in Plainville or not. If they open the temporary plant it will give impact to town and the potential employees. This scenario was related to corporate legality versus corporate responsibility. They can open the temporary plant to increase its output of component but they must care about the impact of their employees.

A stakeholder is a group or any individual that interested in some way with the company and involved in any of their activities or issues. The corporate stakeholder in this case is T. Kelvin William as a senior executive or an outsider director while the...