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- Introduction
Community leaders in Auckland have accused my client and others for unfair business practices in the name of doing business. The main issue of contention here is the feeling amongst the local opinion leaders that these fast food chains are only interested in profiting from the poor people, by selling them junk, which is unhealthy. The management of Carl’s Jr Restaurants, however, feel that this is unfair to them and seek to explain that their product offering is safe (Anne Gibson, 2012). The author of this report was therefore, hired to analyse this dilemma, and try to put it into perspective, while at the same time trying to find solutions and best way forward in this situation. In this analysis, the author will explore the business environment in which this restaurant operates, identify the key stakeholders in this business, a theory of ethics will also be explored before a recommendation on the appropriate responses to the dilemma can be arrived at.
- Discussion:
- Relevant aspects of the business environment
There are several aspects of business environment that are evident from the above mentioned dilemma. A brief analysis of the cases study indicates that the fast food chain is faced with a number of aspects of business environment that must be fully understood within the context of the business, and manipulated or utilized for the benefit of the business. This discussion will be centred mainly on the macro environmental aspects as they are the most significant aspects of the dilemma. Key among this is the Political environment.
It’s said that the local council board members are not happy with the expansion of these global fast food chains into their locality. Even though they do not have direct impact on the decision making in deciding whether companies can set operations in this area, they have the capacity to petition the local government to deny the chains the opportunity to set up business in their areas. Alternatively, we are informed that they are petitioning for the provision of civil education on the need for healthy eating, which would easily result to economic sabotage for these fast food dealers as customers avoid their products.
The second one is legal. This is probably the most prominent environmental aspect that is evident in this dilemma. The local leaders are up in arms to ensure that the company is denied the authority to set up a branch in the region. The insistence by the local authority leaders on denying the opportunity to fast food dealers has serious legal implications. Of importance to note is that the company will face a lot of resistance even in start up as a result of the many legal requirements that would be set up by the government due to the outcry by the local leadership (Christopher, 2012).
Economic environment- As is explained in the case study, this area is a low income area, and the companies are actually taking advantage of the conditions of the locals to market their products. This has a habit of eating into companies profits when the purchasing power of a client base is constrained. Additionally, there are cries of ways of reducing the sale of these fast foods. Most prominent of these cries is the need for an introduction of a tax system that actually makes it undesirable for the companies to operate. This, coupled with other economic factors such as low income would easily conspire to make this market less attractive.
Technology- This refers to the production process. We are informed that this restaurant is able to make healthy burgers by ensuring that they have less burns and encompassing burgers with lettuce. This is an environmental aspect of the business that must be managed properly for the benefit of the business.
- Stakeholder interests
There are several interested parties in this dilemma, whose interests must be satisfied for the success of the business. Key among these is the customer. The interest of the customer in this case is quality food; quality in this case entails mainly healthy food. This is the reason why the company is almost denied entry into the region as it’s known for its burgers and other fast foods that are deemed unhealthy. The customer must therefore be considered as a key stakeholder in any key decisions as their satisfaction is important to the success of the business at large.
The government- The government has a key role of providing security, as well as healthcare to its citizens. To succeed in this, the government has to adopt a preventive approach rather that curative/reactive. This, therefore, means that although the government is very interested in the taxes that it hopes to collect from the returns accruing to this business, they also must be concerned at the safety of their citizens.
Employees- the employees in this scenario would like to get to work so as to earn a salary. The continued talk about the probability of denial of the opportunity to set up a business in this region could actually mean that they could be jobless, therefore, they are interested in ensuring that they work is secured.
Management- As expected, the management is interested in carrying out a successful business expansion into the area. They are interested in ensuring that their business gets started and going as fast as possible so that returns for their investment can start trickling in. This is the reason for their insistence on setting up this venture in this locality where they are sure to do a great business (Musschenga & Heeger, 2012).
2.3 Ethical business decision making
The ethical dilemma that faces the business is however the decision as to whether to make and sale fast foods that are considered unhealthy, and make a lot of money, or to insist on the ‘healthy’ foods and make modest returns.
There are three basic theories of ethics mainly the utilitariarism, the ethics theory as well as the moral theory. By definition, the utilitarianism theory advocates for the best consequences for all (Mill, 1979). The ethics theory states that an act is right if it’s naturally in accordance with the moral rule of principle, while the morality theory postulates that an action is right if a virtuous person would have done the same thing in the circumstances. It’s the opinion of the author that the restaurant management normally adopts the egoism theory in which one wants to get everything for themselves at the expense of everyone (Kant, 1993). This is evident from the resistance that the locals have to this business as they reason that the business will only be interested in their profits and not the welfare of the citizenry.
- Conclusion
- Recommendations
A number of issues need to be noted by the management of this restaurant, if they have to succeed in this region. First and foremost is market research. From the onset of the case study, it’s evident that thorough market research was not done, this would have pointed out the issues being raised and these would have been discussed and settled even before setting shop in this area, which would have save d the company the public relations menace that it faces.
Another very important issue that needs to be addressed is ethics in marketing. It’s important that the company understands the kind of products that the locals here would prefer. This means that the company must ensure that whatever they market, or claim to offer, is actually what is on offer. This open business practice would easily create trust with the locals. Unethical and dishonest marketing and promotion practices would not only lead to legal action but would also read to d reduced trust with the customers.
The company would immensely benefit from engaging the locals corporate social responsibilities. Contribution to the local society cause would be a great step towards creating healing with the local community. This would easily erase that egocentric tag that is already associated with the company.
Appendix (Reflection)
The above paper has detailed the dilemma that faces the Carl's Jr Restaurants, and especially the new location at Avondale. The paper has discussed the various ethical issues, stakeholders as well as environmental aspects of business.
Some of the environmental aspects that have been identified include the political, legal and economic as well as technological environments. Notably, the company can be able to manipulate these environments so as to effectively deliver services to the customers.
The discussion segment of this report also centred on the various ethical theories and identified a few as utilitarianism theory, the morality theory, the ethics as well as the ego theory. The report also identifies the local’s perception of fast food restaurants as the main restriction and drawback to the successful implementation of the expansion programme and makes a number of recommendations for countering this résistance. The author hopes that the adoption of these recommendations would be critical to the success of this business in the region
References
Mill, John Stuart (1979) Utilitarianism. Ed. by George Sher. Indianapolis: Hackett Publishing Company.
Kant, Immanuel (1993) Grounding for the Metaphysics of Morals: On a Supposed Right to Lie Because of Philanthropic Concerns. Indianapolis: Hackett Publishing Company.
Musschenga,A.W ; Heeger, F.R (2012). Ethical Theory and Moral Practice. An International Forum Adapted from http://www.springer.com/social+sciences/applied+ethics/journal/10677
Anne Gibson (2012) Fast food 'targets (Auckland's) poor' adapted from:
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10785524
(Christopher, A (2012) (The Newzealand Herald:http://www.nzherald.co.nz/health/news/article.cfm?c_id=204&objectid=10868476
Tiffany Hsu (2012) Los Angeles Times. Adapted from: http://www.latimes.com/business/la-fi-andy-puzder-cke-20130316,0,4724331.story?page=1&track=lat-email-topofthetimes)
The Harvard School of Public health (2012).The obesity prevention source Adapted from: http://www.hsph.harvard.edu/obesity-prevention-source/obesity-causes/food-environment-and-obesity/
http://scholarship.law.berkeley.edu/cgi/viewcontent.cgi?article=1198&context=californialawreview
http://www.nytimes.com/2013/02/24/magazine/the-extraordinary-science-of-junk-food.html?ref=magazine&_r=0&pagewanted=all
