The basic facts derived from the case study that the company, GE Healthcare that is under the GE group. It is in the business of selling products utilized in the medical field such as diagnostic imaging, clinical systems and Intergrated IT solutions such as Ultrasound machines. It is the leading medical systems and service provider in India. The company earns more than 10 million dollars in sales and revenue of more than $15 Billion. The company employs more than 45,000 workers in the whole world.
The company merger with Wipro Corporation allowed the business to achieve the majority of its success. The merger allowed the company to increase its market segment and sale to many buyers within India even in the rural areas and across the world. In the year 2015, the company experiences a revenue growth of 10%. The success of the business has made it competitive defeating its direct competitors who are Toshiba, Philips and Mindray (Wicks, 2010).
The success of the company enables it to set a higher target for the following year. By the end of the year 2016, the company should have applied efforts in its marketing and sales to ensure that it has a revenue growth of over 20%. However, there was an incident where the government put a law forward to confiscate all of GE Healthcare leading product, an Ultrasound machine.
The reason as to this is that there was evidence to support the fact that physicians were using the devices to determine the sex of an unborn child illegally. The inappropriate use of the device was a violation of the Prenatal Diagnostic Techniques Act of 1994 and its 2003 Amendment. In addition to that, the company also had the accusation of supplying the machines to clinics without registering them with the government (Wicks, 2010).
The effect of such publicity will negatively affect the business. The company will face multiple losses regarding profits; it would lose it market segment and its brand tarnished. In addition to that, the goal that the business set will not be achievable. Even after the publicity has died down, the firm will still experience some losses because it will spend a lot of money in convincing consumers that its products is of quality and also to much time spent in finding ways to rebuild the brand than achieving the company objectives.
The investor will experience loss of his or her investment. The loss will make the investors pull out their money that the firm uses as capital. There will also be an adverse effect on employees because sales of the products would reduce thus loss of compensation and decrease in the initial salary. In addition, the company may ask the employee to work extra time to devise ways to restore the firm to its former glory. This means that there will be extra working hours with no pay.
The fact may lead to many of the workers resigning their jobs. The customer will experience a negative effect because if there is confiscation of devices, other producers may sell the same devices at a higher price. The consumer will spend more than necessary to acquire the machine. The society will also be negatively affected the losses of the company would mean that all efforts will be in trying to get the confidence of the enterprise in the market. It means that matters of the society would hold such as foundation or donations given to local authorities for the development of the community.
My personal view regarding the situation present in the case study is that the government should be adaptable to change. The laws should undergo constant modification to suit the changes found in the region. The decision to confiscate products should also consider a larger outlook such as the effect on the economy and the medical industry. It should also take into consideration that the manufacturers of the product do not break any law but the user; the physicians did, making them unethical. It should also keep in mind that just because GE is the manufacturer of Ultra Sound, it has no influence when it comes to the current numbers of boy and girls born or even the decreasing number of girls given birth.
The methods the company should deploy are such as training its sales employees. The training will enable the salespeople to be effective and knowledgeable when it comes to government restrictions and getting consumers to sign affidavits to confirm that they will not use the product to determine the sex of an unborn child. Another strategy they could use is to conduct audits on its consumers to ensure that they are using the device in compliance with the law.
Another strategy is creating an assembly with the media present. The company will have a spokesperson who will refute all allegations put forth on the press regarding its products. The aim of this method is to salvage the company’s reputation and assure its market and investors that it is still reliable. In addition, the firm can have its form of media advertisement such as Social Media and blogs that do not publicize bad news about the company that may tarnish its image (Wicks, 2010). The company can also put in more funds in marketing and advertise its product to the market. It will enable it to build on the tarnished brand.
References
Wicks, A. C. (2010). Business Ethics: A Managerial Approach. Boston: Prentice Hall.
