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2. Introduction
Toyota Motors a very popular automobile maker having large market shares
around the world. Now a days Toyota company is facing high obstacles and
fallen down into crises as a consequence of some unethical decisions.
Details tell us, since 2000 Toyota has expanded its production line from 5.2
million to 10 million with 17 more productions sites. This unsustainable
production made inevitable for company to procure auto-parts from overseas
sub contractors, thereby making it difficult to oversee every procedure
involved in the quality control process. Moreover due to growing competition
company putt an immense pressure on its subcontractors to cut production
prices at least 30%, resulting in diluted quality. This is evident from the
reports of news papers and BBC news. According to a analysis of complaints
by auto safety control firm Quality Control System found that number of
complaints received by National High Way Traffic safety Administration
tripled since introduction of electronic throttles in Toyota vehicles and due to
break problems many people have died in road accidents. However Toyota
continued a similar careless attitude in response to these complaints and
normal tendency remained to blame the drivers and go on. After an
immense pressure by customers and high media coverage to these
complaints Toyota turned to accept the flaws and started recalling different
vehicles back for necessary rectifications. These decisions of Toyota are
criticized as unethical because the security procedures and risks of precious
lives were compromised over profitability plans which lead the company
towards destruction. An estimated amount of vehicles recalled back due to
break paddle and floor mat problems is more than 8 million this amount is
surpassing its 2009 total global of sales of 6.98 million vehicles. What are
the results received as consequences of unethical decision, are illustrated
below.
• More than 40 people (On record) have died and several have been
injured because of vehicle break problems.
3. LITERATURE REVIEW
Businesses that exhibit and promote strong corporate codes of ethics are
more prosperous in the long run because they show a commitment to an
expectation of sound moral behavior. This shows a dedication to society,
customers, employees and the business itself. It will also enhance the
company’s reputation (goodwill) if it is generally known as an ethical
company and ultimately bring more value to the organization. Donna
Burgess (2009).
It is true that due to the competitive nature of global economy today,
leaders of firms seem to be under immense pressure to remain profitable
and to show good returns to stakeholders, but this does not justify unethical
decisions. It should be known that as leaders of firms exhibit unethical
behaviors and even try to justify their actions when they know that it is
wrong, this gradually become part of organizational culture. People follow by
example and lack of moral judgment will spread. It is easy to blame “the
system” yet people forget that the “system” is made up of decision making
individuals. Leigh Goessl (2010).
One only needs to recall the Enron incidence or high profiled business
professionals like Bernie Madoff to know how poor ethical practices affect the
society. Robert Grice (2009). Some of the specific effects are:
• Loss of Confidence
• Loss of Resources
A second effect of unethical and immoral practice on the part of business
organizations is the loss of resources. The Phony profits and inflated stock
prices collapsed over time, for instance, leaving the shareholders to absorb
the losses.
• New Legislation
4. Suggestions
In the final analysis, managers and organizations must realize that ethical
and social responsibility issues deservers top priority.
The Companies should acquire fast responsiveness for these issues with the
help of modern technologies, delegated rights and group decisions.
Internet Sites:
http://www.socialworker.com/jswve/
• http://epublications.bond.edu.au/business pubs/68
Journals:
Cody Hodge, (may 2009), How poor ethical decisions can hurt a
company. Article 02, Retrieved April 23, 2010, from
http://www.helium.com/search/search?
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