Assuring Food Safety in the Food Industry - Essay Example

? Delectables Corp: Case Study Part A From the case analysis, it is clear that operations at the Georgia production raisedreadful challenges to long term sustainability of the Delectables Corp. In this context, I will certainly blow the whistle. Current financial data indicate that Delectables is losing its US market share to its major competitor Prince’s Fare. In this situation, even a mild flaw would severely affect Delectables’ business interests in the US market. The company has a recent history of food safety problems despite the fact that none of them were confirmed. Unsurprisingly, food poising issues (Salmonella poisoning) would damage the market reputation of a food company and hence the Delectables may lose its further business to Prince’s Fare. Although the firm’s newly hired Quality Control Director has suggested comprehensive measures to the upper management to ensure the food safety, his supervisors refused to accept the suggestions arguing that they were too expensive. In addition, workers are indifferent to the new quality control system and are not willing to abide by the instructions given by the QC Director. In order to satisfy their personal financial interests, factory employees including foremen clear even contaminated products for the market. This practice increases the chances of food safety issues, which in turn would impact the market stature of the organization. In addition, the Georgia plant has poor infrastructural facilities and hence its food products are exposed to contaminants including Salmonella. Once the Delectables’ goodwill is affected by food poisoning issues, the demand for its products would decline in the market and ultimately this situation would hurt the interests of company stakeholders, particularly shareholders. Therefore, I would not sign the quality control form. However, whistle blowing can have some risks too. This practice is likely to contribute to the financial burden of the company which is already challenged by financial shortages. Sometimes, whistle blowing may end up in even winding up of the Delectables’ Georgia plant. As a result, thousands of employees may be laid off. However, it is vital to prioritize the interests of the firm’s stockholders. Referring to the stockholder theory which “supports the notion of the manager of a business being the agent for the stockholders of the company” (as qtd in Dunham-Taylor and Inczuk, 257), it is inevitable to blow the whistle and thereby to add to shareholder values. The risks of blowing whistle would be outweighed by its benefits. Evidently, lack of effective control mechanisms is the root cause of the food safety and quality control problem at Delectables. From the case scenario it is clear that QC Director has designed comprehensive procedures to separate between pure, contaminated, and mildly contaminated food products. However, factory workers are unwilling to follow these procedures and they clear all the batches of products for the market. It is observed that QC Director has little influence on factory workers and therefore he fails to ensure that quality control measures are executed effectively. It is the duty of the QC Director to make sure that the organization completely complies with the stated quality control guidelines. In addition, the upper management does not pay particular attention to the factory’s product quality; rather it focuses only on financial returns. Currently, the firm’s foremen – who are responsible for clearing the food products for the market – are evaluated and remunerated on the basis of number of finished product boxes per day. Therefore, foremen try to increase the number of product boxes finished a day but not to improve the product quality. In order to address this issue, it is advisable for the management to pay foremen on an hourly or monthly basis. Similarly, the management should promote employee participation using the tools of financial incentives or other strategies in order to change their attitude toward the new quality control system. Part B The government has a major role to play in assuring food safety in the food industry. Unsurprisingly, food companies would not be willing to completely abide by the food safety guidelines proposed by the government as they give prime focus to profitability. It is clear that the high cost of meeting safety guidelines would persuade food companies to skip quality check processes. Therefore, the government has to directly intervene in the state’s food production operations so as to eliminate food contamination issues and other food safety problems. However, the government faces a set of potential challenges in dealing with food safety issues in large companies like Delectables. First, those companies provide employment to a large number of people in the state and hence strict legal actions against them would adversely affect the economic development of the nation. Second, companies like Delectables pay a huge amount in taxes and therefore governments will not be ready to cut one of their stable and potential sources of revenue. Therefore, governments have many limitations in controlling food safety issues in such companies. The case context clearly indicates that Georgia state inspectors are extremely underfunded and the state has only 60 inspectors to control its 16,000 food companies. In addition, the state of Georgia also faces a number of domestic issues like financial deficit, business wind ups, and serious outbreak of food-borne illnesses. Currently, Delectables is a major employer in Georgia and significantly contributes to the GDP of the state. Therefore, if Delectables decide to shut down their factory in Georgia, this situation can have far reaching consequences on the state’s economy. However, the state of Georgia must emphasize more on its citizens’ safety and hence it should not allow Delectables to compromise with food safety in any circumstance. If the food contamination causes an outbreak of food-borne diseases in the state, then the government will be forced to spend huge amounts on the health care sector. Therefore, it is particularly advisable for the Georgia government to take a strong stand on dealing with food safety issues in Delectables. The government can significantly reduce its intervention costs if it makes companies like Delectables more socially responsible. For this, governments may insist companies to publish corporate sustainability reports. This strategy would assist governments to clearly evaluate the social responsibility activities of corporations. It is recommendable for governments to give special grants and other rewards to companies that perform better in terms of corporate social responsibility. Since such rewards may add to their good will, companies would be more concerned about product quality and customer safety. It is advisable for the state not to let food companies regulate themselves. When food companies are provided with the opportunity to do so, they will certainly try to trim down their operating costs and hence give little focus to product safety guidelines. In addition, this situation may persuade food companies to use low quality raw materials so as to minimize their cost of production. Part C The supervisor’s order to export Delectables’ contaminated product boxes to San Lopez seems legal but unethical. The case context indicates that San Lopez does not have strict regulations on marketing low quality food products. Hence, it is legal to market low quality food products in San Lopez as long as its government prohibits the practice by law. However, this business practice is not recommendable when it comes to an ethical point of view. Different international business ethics models focus on the importance of corporate social responsibility and public welfare. These models specifically insist corporations to promote the health and overall wellbeing of communities in which they operate. Evidently, food contaminants like salmonella will certainly affect the health of consumers. The supervisor’s argument that San Lopezians are exposed to numerous parasites and worms that are far worse than salmonella does not make any sense. It is not the matter what the current status of the San Lopez society is but it matter how the Delectables contributes to the wellbeing of the society. According to business ethics theories, it is the duty of Delectables management to improve the health status of San Lopez if it operates in this market segment. However, while selling products with red labels in the San Lopez market, the Delectables add to the health issues of the region. It is precise that San Lopezians eat what Americans regard as contaminated foods on a daily basis only because of the deficiency of healthy food items. These people also have a right to pure food items. Hence, from an ethical perspective, it is unfair for Delectables to export food products which the company is prohibited to sell in its domestic market. In other words, the superior’s plan to export the red labeled boxes to San Lopez is nothing but product dumping. I would express the same view even if the superior’s order was to export yellow labeled product boxes red labeled ones. It is clear that the yellow labeled boxes of products are mildly contaminated and hence they have to be set aside for further testing. Evidently, even mildly contaminated food products can cause health issues. Therefore, it is unfair for Delectable to export the yellow labeled products to San Lopez unless they are proved non-contaminated in further quality tests. Part D As Funk reports, according to the International Anti-Bribery and Fair Competition Act of 1998 (a US federal law), it is illegal for a US citizen or corporation, or a person or corporation operating in the US to influence, bribe, or obtain an unfair advantage from another country’s public officials. Since this particular plant is operating in the state of Georgia, it is illegal for the company to bribe the security officer and customs officers to sell its peanut butter in San Lopez’s supermarkets. At the same time, the company can legally pay executives in charge of San Lopez’s largest supermarket chain $250,000 to store and market its products in San Lopez. This payment is reasonable because Delectable does not intend to seek any unfair advantages from San Lopez’s public officials. However, this payment is ethically wrong because the Delectables management is actually trying to dump their contaminated food products in another market segment. Similarly, the payment of $25,000 for placing Delectables products on the ‘eye level’ shelves can be also legal because such practices are not banned by either US or San Lopez. However, this practice is also wrong from an ethical perspective. By displaying the contaminated products on the eye level shelves, the company tries to attract buyers deceitfully. Therefore, situations like this can be legal but not ethical. Works Cited Dunham-Taylor, Janne and Pinczuk, Joseph Z. Health Care Financial Management For Nurse Managers: Merging The Heart With The Dollar. Jones & Bartlett Learning, 2006. Print. Funk, Markus T. ‘White collar crime report’. 5 (21) (Oct 8, 2010). BNA Inc. web 22 April 2013 Read More