Tom of Maine

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CASE: Tom’s of Maine: “Doing Business” Means “Doing Good”


1. Does the Tom’s of Maine experience prove that one can “do business with principles,” or are there business realities that make it hard for others to copy this principled management model?

Yes, because what Tom’s of Maine did is that they made their employees appreciate and apply the principles that Tom and Kate believed in. Despite some of the mistakes that they did, they were not afraid to try again and to make better decisions. Their principles set them apart from their competitors. Because of their principles, they became a unique company who exemplified “business with principles”.

It’s true that there are business realities that make it hard for others to do the same thing. Businesses that widely depend on sales or on the state of the economy focuses on making their businesses grow. They do however try to help make their processes “environment friendly” in this way, they also contribute to the betterment of the society.

2. What examples and incidents from this brief history of Tom’s of Maine illustrate how the personal ethics and values of founders can positively influence a firm and its culture as it deals with the challenges of start-up and growth?

Tom and Kate’s principles affected the culture of their company and they definitely made it a good culture. They made their employees involved in various charitable works. They donated 10% of their pretax profits to charities. The principles they stood for generally changed the mindset of the workers by not just working for themselves but also working to help the community. It suddenly became an advocacy to do everything in their company for the good of the environment.

3. What are the biggest threats that Tom’s faces in its new life within Colgate’s global corporate structure, and especially with respect to maintaining what Tom and Kate call “the character, spirit and values of our company?”

It would most definitely be the “internal environment” or the leadership principles of the new people coming in. Despite the fact that Tom and Kate maintained a percentage of the company’s stocks and Tom remained the CEO of the company, being in a bigger corporation somehow changes the perspective, attitude and expectations of not just Tom’s of Maine’s employees but also the big bosses of Colgate. There would have to be a shift in profitability expectations. Also, the working habits of the employees of Tom’s might change. Colgate, being a global company, is probably looking at higher profitability due to their recent acquisition of Tom’s. They have a certain right to “meddle” with how the company is going to be operated. If Tom and Colgate would eventually not agree on how the principles would still be applied while not sacrificing the profitability of the products that might just be the cause of the conflicts.

4. Further research: Find news items reporting on what has happened at Tom’s of Maine since being purchased by Colgate. Has the firm been able to operate with the ethics and independence that Tom and Kate had hoped for? Is the company starting to lose its way now that it’s part of a global corporate giant?

Yes, Tom’s still remained true to its company’s principles. Though it was stipulated in the contract that Colgate would respect and maintain the different business approach of Tom’s the different work habits and culture of both Colgate and Tom’s might be the cause of the conflicts in the future.

To remain true to their advocacies and to make sure that Colgate’s majority in stocks won’t change what Tom and Kate stood for, Tom’s of Maines had been coming up with various campaigns in relation with corporate social responsibility. They’ve been using these powerful campaigns to maintain their culture and principles. An example is the online voting of on Social Responsibility Initiatives. This is a good way of...
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