PLC Part 2: Decision Making

February 4, 2023

Introduction & Problem Identification:

The case I choose includes 4 characters with the theme of corporate social responsibility and is called “Safety? What Safety?”. The four characters include Bob, who’s president, John, a chemical engineer, Henry, the controller, and Kirk, the assistant controller who plays the protagonist in this story.

Kirk who is considered a smart employee has been being groomed to rank up and take over the controller position. Being a good employee at the company upper management has started including him in major company functions including the monthly financial statement summary which he was asked to attend.

Within this meeting talk about opening a new manufacturing plant and the cost per unit of the chemical products had begun. Bob and John then enlightened the group on the waste treatment and disposal problems that may arise from this. John went on to say that the current waste facilities would not be adequate for this new plant and wouldn’t meet the industry’s high standards but would pass the federal standards. If the company were to add the additional waste facilities it would raise the cost per unit. The dilemma is the decision between making more profit or damaging the environment. One last point which was brought up was environmentalist pressuring improvements in regulations at a federal level. Even with this Bob decided for the company the new manufacturing plant would open and the company would not spend anymore money in waste facilities because there closets competitor isn’t even up to par with their current waste facilities. The majority of the managers agreed with this and Kirk was left speechless.

Decision Criteria:

Environment 10/10: If the new manufacturing plant has any chemical leakage it could be detrimental for the ecosystems and environment around it. Additionally, we don’t know the plan of action from the company in terms of what will happen to the excess of chemical products which need to go into proper waste facilities. This is very dangerous because they could be dumping this anywhere, most likely not where people live which means it would harm an ecosystem full of wild life.

Profit 10/10: Shareholders, managers, and certain stakeholders like investors want to squeeze as much money into their pockets as they can even if the chances of ruining the environment are foreseeable. The amount of people who will benefit from this are most likely greater than the people who might be negatively affected by this. Adding a waste treatment plant would raise the cost per unit and decrease profits. Although with time, the edition of the new manufacturing plant may allow the company to reach economies of scale which means the cost per unit actually decreases returning more profit to the business.

Risk 10/10: With improper waste disposal or chemical leaks the surrounding community which could include family’s and kids would be affected by the contaminated material. Additionally if an accident were to happen, the lawsuit and damages could cost more than the waste facility itself. Lastly, if regulations change and the government comes to check for inspections they will see the lack of waste facilities that were required for the manufacturing plants for the time period prior to the increase in regulations.

Convenience 6/10: If the waste facilities were built, when federal regulations are raised the company wont have to be pressured into building the facilities immediately. This is convenient for the company because there playing a guessing game as to if they’ll have the money when the regulations change instead of getting ahead of the game while they can.

Generate Alternatives:

1. The first alternative is to build the additional waste management facility to abide by industry regulations even if it costs more.
2. The second alternative is to move the manufacturing plants to a different country or region with lower or no regulations at all.
3. The third alternative is to find a more environmentally friendly plating process. This could mean using existing technology or creating new technology to plate the products.

Evaluate Alternatives:

Alternative #1: With this alternative the environment is positively impacted because it lowers the risk of waste leakage, although it requires the company to build a new facility. Secondly, profit is negatively impacted because its costly to build a new facility. Additionally, the risk involved is low because it meets industry and federal standards but ill require the company to take out an additional loan affecting profits. Lastly, the convenience of this alternative comes with not having to change much while also abiding by federal regulations incase they increase.

Alternative #2: With this alternative the environment will be destroyed by dumping chemical products because of the lack of regulations and standards in the new country. Secondly, profit will increase because manufacturing plants will cost less to build, there will be no need for waste facilities to be built, and labor costs are cheaper. This will lower unit costs and increase profit. Additionally, the risk of this alternative comes with not being able to sell your current plant or the time and money it will take to transfer your knowledge and technology. Lastly, this alternative is the least convenient because it requires you to sell you plant, find a new country, make connections with new suppliers abroad, and methods of exporting products back to the home country.

Alternative #3: With this alternative the environment will be positively impacted because the use of new technology and a environmentally friendly plating process. Secondly, profit may decrease with the additional costs of finding or buying the new technology as well as implementing it in the manufacturing process. Additionally, the risk of this alternative is pretty low because it doesn’t negatively affect the environment nor will the costs be excessive. Lastly, the convenience of this alternative comes with not having to use waste facilities anymore, while on the other hand requires you to change your business processes.

Select the Best Alternative: 

The best alternative for this company is to use or create new technology within their plating process. This is the best alternative because it has very little impact on the environment, it wont cost a lot to develop, the overall risk is low, and it will end up being convenient for the company.