Management Ethics

gement ethics Management Ethics |

The Ford\ Firestone Debacle |

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Kancerov Timur |

10.07.2012 |

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1. What systemic, corporate, and individual ethical issue are raised by the Explorer\ Firestone case?

* Consumers are exposed daily to high levels of risk simply by using consumer products.

In this case Firestone Company targeted on efficiency but they made defect in their product and had to recall it immediately or stop the line production and selling cars equipped with this tires until the full investigation find problem.

The Ford Company had to do the same when first accident hapend and when first time defect spotted.

In the market approach to consumer protection, consumer safety is seen as a good that is most efficiently provided through the mechanism of the free market whereby sellers must respond to consumer demands.

Problem happened with already proved its safety and quality product/ It caused by defected tires and customers at least have to be advised that new line of a such product is not as qualified as before.

2. Three theories.

According to the ford company the theory in which ethical problem happened was Contract theory which states:

* When we purchase an item, we enter voluntarily into a "sales contract" with the firm, who then has a duty to provide a product with the characteristics they have agreed to supply.

* Consumers therefore have a correlative right to receive the product they have been promised.

According to the Firestone Company they had to consider The social cost view theory which states:

* It maintains that a manufacturer must pay the costs of any injuries sustained through any defects in the product, even when the manufacturer exercised due care and took all reasonable precautions to warn users of every foreseen danger.

* This theory, which forms the basis of the legal doctrine of strict liability, is utilitarian.

* It says that the external costs of injuries resulting...