wiegie Posted February 5, 2011 Share Posted February 5, 2011 (edited) Your company produces a product which you have just learned is defective and has the possibility of severely injuring or even killing the consumers who use it. A recall of the product will cost your company $2 billion dollars. Your lawyers have told you that if you don't recall the product your company is expected to lose $1 billlion dollars in civil lawsuits. (Your company lawyers and personal lawyers have also told you that there is no way that you or anyone in your company will face criminal charges or personal civil suits from this situation.) You get to make the call for your company: do you recall the product or not? EDIT: To make it clear what I am getting at--assume that there will be little to no market backlash if you decide not to recall the product. If you recall the product, your company loses more money than if you don't recall the product. Edited February 5, 2011 by wiegie Quote Link to comment Share on other sites More sharing options...
alexgaddis Posted February 5, 2011 Share Posted February 5, 2011 Heck no! Quote Link to comment Share on other sites More sharing options...
Lucky11 Posted February 5, 2011 Share Posted February 5, 2011 i guess you can try to put a price on the life/health of individuals, i wouldn't. recall. Quote Link to comment Share on other sites More sharing options...
Ursa Majoris Posted February 5, 2011 Share Posted February 5, 2011 (edited) Hell yes. The loss will be greater now but future losses on future products would be enormous if it ever got out that we'd deliberately allowed people to be killed and injured. ETA: And it's the right thing to do. Edited February 5, 2011 by Ursa Majoris Quote Link to comment Share on other sites More sharing options...
wiegie Posted February 5, 2011 Author Share Posted February 5, 2011 Hell yes. The loss will be greater now but future losses on future products would be enormous if it ever got out that we'd deliberately allowed people to be killed and injured. ETA: And it's the right thing to do. I have edited my initial post to make it perfectly clear what I am getting at EDIT: To make it clear what I am getting at--assume that there will be little to no market backlash if you decide not to recall the product. If you recall the product, your company loses more money than if you don't recall the product. Quote Link to comment Share on other sites More sharing options...
Ursa Majoris Posted February 5, 2011 Share Posted February 5, 2011 I have edited my initial post to make it perfectly clear what I am getting at This is your long-awaited assault on those of us that argue in favor of the golden rule and that, absent a terrible situation, society is self-sustaining, isn't it? Quote Link to comment Share on other sites More sharing options...
untateve Posted February 5, 2011 Share Posted February 5, 2011 I will answer once you explain to me how my product killing someone does not create any backlash against my company. Quote Link to comment Share on other sites More sharing options...
Puddy Posted February 5, 2011 Share Posted February 5, 2011 The cost of human life is part of business decisions all the time even when it isn't obvious. Maybe all cars should have bullet proof glass in them. It would prevent deaths in road rage shootings. Problem is...road rage shootings are pretty rare so the cost to save some lives is too great to bear. However, in this case, an error by my company may unexpectedly cost human lives. I have to recall to prevent it. Quote Link to comment Share on other sites More sharing options...
Puddy Posted February 5, 2011 Share Posted February 5, 2011 I will answer once you explain to me how my product killing someone does not create any backlash against my company. It's just a given in this example. Run with it you quack. Quote Link to comment Share on other sites More sharing options...
cre8tiff Posted February 5, 2011 Share Posted February 5, 2011 I worked in the toy industry for a while. The toys made have to pass the "choke test". There were a couple of times where the toys were slightly out of spec and could be forced into the choke tube (used to measure this "chokability"). We recalled without question, despite the fact they may never have harmed anyone or we get sued. Quote Link to comment Share on other sites More sharing options...
keggerz Posted February 5, 2011 Share Posted February 5, 2011 Have you seen Class Action with Gene Hackman? Quote Link to comment Share on other sites More sharing options...
Rebellab Posted February 5, 2011 Share Posted February 5, 2011 Are you referring to Remington firearms in the model 700 and the safety/trigger malfunction. It is similar to your example. Quote Link to comment Share on other sites More sharing options...
buddahj Posted February 5, 2011 Share Posted February 5, 2011 IMO, it's better to honest & upfront with your customers. I'd recall the product. Quote Link to comment Share on other sites More sharing options...
electricrelish Posted February 5, 2011 Share Posted February 5, 2011 (edited) If a company has to ask this question, then that just goes to show how misguided they've become. There should be no question as to what the company should do, and if they don't perform a recall, then someone should blow the whistle. Edited February 5, 2011 by electricrelish Quote Link to comment Share on other sites More sharing options...
wiegie Posted February 5, 2011 Author Share Posted February 5, 2011 I will answer once you explain to me how my product killing someone does not create any backlash against my company. Assume the company is ending it's operations anyway. Further assume that the company has exactly $2 billion put away in some sort of interest-bearing account somewhere that could be used to pay for the recall, but because of a previous legal ruling none of the money in that account can be distributed to shareholders for at least 10 years (or until the statute of limitations runs out on civil suits for defective products). And also assume that part, though not the majority, of your compensation is in the form of stock options. Quote Link to comment Share on other sites More sharing options...
DMD Posted February 5, 2011 Share Posted February 5, 2011 My first assumption is that I want to be able to look at myself in the mirror every morning. And I want to be able to sleep at night. Quote Link to comment Share on other sites More sharing options...
Kid Cid Posted February 5, 2011 Share Posted February 5, 2011 The right and ethical answer is to recall. The correct business answer is to not recall. The business exists to make money and the investors will receive a greater payback on their investment if there is no recall. With the way corporations are structured, there is no liability to an individual for making this decision. Quote Link to comment Share on other sites More sharing options...
TimC Posted February 5, 2011 Share Posted February 5, 2011 Is the company public? Because you work for your shareholders and not the consumers. [/evilCEO] Quote Link to comment Share on other sites More sharing options...
Savage Beatings Posted February 5, 2011 Share Posted February 5, 2011 I would get a golden parachute and resign leaving the decision to my successor. Seriously though, if I knew in advance that my actions (or inactions) would directly contribute to killing someone, I would have to make the decision to recall regardless of the financial consequences. It would be a horrible decision for the company, and I would most likely lose whatver position I had, but at least I would be able to sleep at night. Quote Link to comment Share on other sites More sharing options...
i_am_the_swammi Posted February 5, 2011 Share Posted February 5, 2011 lets see... Lose $2B now in cost of recall or lose $1B now in legal lawsuits, plus a hugh thing you didn't even bring up: loss of multiple billions more in future sales by consumers that will no longer use your product. No brainer: do the ethical AND less-costly thing, which is to recall. Quote Link to comment Share on other sites More sharing options...
untateve Posted February 5, 2011 Share Posted February 5, 2011 It's just a given in this example. Run with it you quack. Your example did not inspire a response. Assume the company is ending it's operations anyway. Further assume that the company has exactly $2 billion put away in some sort of interest-bearing account somewhere that could be used to pay for the recall, but because of a previous legal ruling none of the money in that account can be distributed to shareholders for at least 10 years (or until the statute of limitations runs out on civil suits for defective products). And also assume that part, though not the majority, of your compensation is in the form of stock options. I know for certain I would institute a recall. Quote Link to comment Share on other sites More sharing options...
wiegie Posted February 5, 2011 Author Share Posted February 5, 2011 lets see... Lose $2B now in cost of recall or lose $1B now in legal lawsuits, plus a hugh thing you didn't even bring up: loss of multiple billions more in future sales by consumers that will no longer use your product. No brainer: do the ethical AND less-costly thing, which is to recall. I've already addressed your comment--the more profitable thing to do is to NOT recall Quote Link to comment Share on other sites More sharing options...
smithkt Posted February 5, 2011 Share Posted February 5, 2011 Since you say the company will be ending operation anyway, there is nothing to protect accept the money going to the shareholders. I'd issue the recall and sleep better for it. At this point I expect you will alter the conditions again to make it very lucrative for me to keep quiet, right? Quote Link to comment Share on other sites More sharing options...
untateve Posted February 5, 2011 Share Posted February 5, 2011 Since you say the company will be ending operation anyway, there is nothing to protect accept the money going to the shareholders. I'd issue the recall and sleep better for it. At this point I expect you will alter the conditions again to make it very lucrative for me to keep quiet, right? One of the shareholders has kidnapped your dog... Quote Link to comment Share on other sites More sharing options...
rajncajn Posted February 5, 2011 Share Posted February 5, 2011 Don't be a dick... recall Quote Link to comment Share on other sites More sharing options...
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