Case Study

Case 1 The Recalcitrant Director at Byte, Inc.: Corporate Legality Versus Corporate Responsibility

Abstract: Mr. James Elliot, CEO and Chairman of Byte Products, Inc., presents his recommendation to the Board of Directors to purchase an existing plant in Plainville as a temporary plant until the new one is on line in three years. All on the Board except. Kevin Williams from the eleven seem to favor the proposal. Byte Products has three existing plants operating at full capacity (24 hours a day and 7 days a week) these three plant are: 1. Electronic home components. 2. Sophisticated business components. 3. Engineering components.

The new plant of Arts manufacturing proposed to be built in the southwestern United States will require three years before it is fully on line. This means that Byte cannot meet the anticipated demand for its products. Alternative solutions have been explored: 1. license Byte products and technology to other United States manufacturers, and 2. Overseas facilities and licensing. Top management found an existing plant in Plainville, that would meet the company¶s immediate production needs until the new plant will be online in three years. The Plainville facility had been closed for the last eight years. It would take about three months to get the Plainville plant online.

The discussion between Elliott and Williams focuses on the impact on the town and on the potential 1,200 employees of opening this temporary plant. The town and the townspeople had gone through a catastrophic closing eight years ago when the plant in question was closed. After a lengthy discussion between Elliot and Williams, a recess in the meeting is called. When the board meeting is reconvened, a major shift has taken

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place. The vote could be 7±4, or 6²5 for the proposal, but Elliott desires a unanimous vote. As the case ends, Williams is asked if a compromise can be reached, but Williams said: Respectfully, "I have to say no."

Strategic Decisions Making...