Measuring Our Worth Case Study

Measuring Our Worth Case Study

If you were deciding whether to engage in the recall or settle the cases in which injury occurred, which would you choose? Why?

This question is difficult to answer considering the contextual divide between myself and the executives tasked with running Ford Motor Company as a profitable publically-held company. While it is easy to reflect with the clear vision afforded by hindsight, and say that the Ford executives who elected to let the dangerously designed Pinto remain on the market committed an egregious moral error, one must remember the underlying circumstances that contributed to that fateful choice. Each of the Ford executives in charge of calculating this problem's ramifications and making a decision had families of their own, and by advocating for a policy that would have cost the company over $71 million they very well may have forfeited their prominent positions of employment. While I can safely say that my choice would be to institute an immediate recall of all Ford Pintos in the nation, my choice is made without any of the external pressures faced by Ford Motor Company's executive management structure at the time. The reasons for my personal stance on this issue are clear: the intrinsic value of a single human life has more importance than the instrumental value of monetary gain (Hartman & DesJardins, 2008). By approaching this dilemma from a different vantage point, however, I can see how an executive officer making decisions from the comfort of a luxury office tower may elect to prioritize instrumental value over the intrinsic value of an anonymous human life.

2.) What influence does the value of your stakeholders have upon your decision?

In this scenario the key stakeholders to consider are Ford Motor Company's stockholders, the consumers purchasing Ford automobiles, and my fellow executive officers. The influence of stockholders is perhaps most crucial to consider from a managerial, because by instituting a recall that costs the company $72 million shares of Ford stock will experiences volatility and reduction in value. From a humanistic standpoint, however, the stakeholders who truly deserve concern are those consumers unwittingly transporting their families around town in a proverbial time-bomb. The simple listing of "180 burn deaths & 180 serious burn injuries" (Hartman & DesJardins, 2008) does not capture the sheer human suffering that the expected rate of 2,100 accidents is sure to cause. Finally, the influence of my peers within the management structure of Ford would affect my decision significantly, because if I felt that advocating for a costly recall was undermining my status, it would admittedly be difficult to stand alone on the issue.

3.) What sort of financial impact will your decision have upon the company?

In the short-term the decision to recall all Ford Pintos would cost the company upwards of $72 million, in addition to any ancillary losses suffered from negative media publicity and public image. What Ford's executives failed to understand is that they are playing a long-term game, one in which a loss of $72 million pales in comparison to the diminished reputation and reduced market share that occurred once people began to crash, incinerate, and die in their faulty Pintos. By instituting a total recall immediately, the initial loss would soon be offset by the gains in public goodwill, as people shift their allegiance to the company that does everything in its power to protect their safety. As there are still countless Americans who refuse to purchase a Frd vehicle due to the Pinto scandal, it would appear that the $72 million saved in 1968 has been far outpaced by the losses incurred after Pintos began exploding across the nation.