Target Corp

Table of Contents

Introduction to the Case 3

Analysis of the alternative # 1 3

Analysis of the alternative # 2 4

Analysis of the alternative # 3 5

Conclusion 7

References 8

Introduction to the Case

This case analysis concerns the question: "You are the owner of a major garment retailer in a buyer-driven commodity chain. The garments you buy, brand, and market are produced in independently owned factories in Thailand. These factories have been producing high-quality, low-cost garments for the past year. However, you have recently discovered that these factories employ child labor and have very unsafe working conditions. What should you do? What are your options?"

This is a very important ethical issue that can shape the corporate culture of the organization. There are a few decisions that the organization must make to establish this internal culture and external image to the world. The results of the actions taken in reference to these decisions could not only change the corporate culture, but they could have an effect on the bottom line that could become a controversy within the organization stakeholders.

Analysis of the alternative # 1

The first step in the resolve of these issues is to determine whether your firm approves of the practices of these independently owned factories in Thailand. Many of your competitors overlook such practices in order to purchase merchandise for a lower price. If your company is only in business to sell the highest quality product at the lowest price at any ethical expense, then you look the other way, say nothing and do nothing.

If this alternative is chosen the organization must be prepared to pay the consequences of their decisions at a later date. Many firms may get away with doing business with these types of vendors. You may not be so lucky. Once word gets out that your stores are selling garments manufactured by children in swear shops you may lose some very dedicated customers that have been keeping you in business.

Analysis of the alternative # 2

If your firm is promoting a culture of ethics and caring for the human condition in your firma and in your corporate partners, then you need to do something about the situation. If the supplier gives such a great deal to your firm that you do not want to lose them, then you must issue an ultimatum to them to change their policies on child labor and to improve the working conditions in their factories.

If the owners of the factory agree to your terms, your firm must do your part to strengthen the relationship by guaranteeing to make them one of your dedicated vendors. This mutual agreement to work together can only strengthen the success of both businesses. It is very important that you follow through on your end of the bargain and that you make sure that they follow through on theirs. This mutual agreement can be used as a marketing strategy if your firm decides to exploit or announce it.

If you make this proposition to the vendor and they either refuse or back out later, you must sever all relations with that vendor. If this severed relationship means that your firm must raise prices in order to provide the quality that you have guaranteed to your customers, then you must inform your customers why you have raised your prices. If the effort to do the right thing, your firm should not have to suffer. If you are supplying quality merchandise, your customers will understand and actually appreciate your decision. This action in the behalf of the betterment of the human condition above making maximum profit should help your business and the morale of your corporate culture

Analysis of the alternative #3.

A completely different and far more radical alternative to this problem involves looking at it from a macro perspective. We as owners of businesses products being produced in these environments need to ask ourselves, Why is this happening and what can we do as a company to try to stop it? The first thing we need to do is look at the cultural environmental factors that are coming into play here. Thailand has many segments of its population living in poverty with little food, water, medicine or the other basic living essentials along with little in the way of education for their children. As a tragic byproduct of their plight people are forced to send their very young children to work. We as a corporate, at the very least, have a responsibility to provide these basic essentials for the adult workers who work for us and in turn hopefully this will allow for a better way of life for their children, thus keeping them out of the sweatshop environment.

When a corporation begins to have their products manufactured oversees they begin to have a responsibility to the local community who is producing their goods. As a corporation we need to be involved in promoting and petitioning to have the salaries of these garment workers raised. I realize this is the reason a good deal of foreign firms are there, because of the inexpensive labor. We could increase the salary of the workers and still pay a considerably lower wage than we would pay American workers. We would still have the workers and their lives would be greatly improved allowing them to be able to purchase the basic living essentials. This