values and ethics
Values and Ethics
Essay #2
Ethical Dilemma Beech-Nut Nutrition Corporation was a division of Squibb Corporation. Its chewing gum segment was profitable but was sold in 1973. Beech-Nut’s baby food division, which had 15% of the baby food market, had never been profitable, and by 1978 creditors were increasingly anxious. Beech-Nut had entered into a contract in 1977 with Interjuice Trading Corporation for Interjuice to furnish apply juice concentrate to Beech-Nut at a price that was 20% below market prices. This contract was a huge break for Beech-Nut because it used apply concentrate in 30% of its baby food products. The Interjuice contract attracted enough attention that Nestlé purchased Beech-Nut in 1979. Jerome J. LiCari was the director of research and development for Beech-Nut. Mr. LiCari and the chemists in his department were concerned about the Interjuice contract for two reasons: (1) rumors of adulteration (substituted product or inferior product) in the apple juice concentrate market were rampant, and (2) the price was simply too good to be true. At that time there were no tests to determine adulteration, but Mr. LiCari sent two of his employees to the Interjuice plant in Queens, New York. Interjuice officials refused to allow them to see processing operations but did provide them access to the plant storage tanks. Mr. LiCari then tried, in 1981, to develop a test for adulteration. He could not, but he took his circumstantial evidence and concerns for Beech-Nut’s reputation to John F. Lavery, Beech-Nut’s head of operations. Mr. LiCari suggested Beech-Nut adopt Gerber’s policy requiring suppliers to establish authenticity or lose their contracts. Mr. Lavery called Mr. LiCari “Chicken Little” and told him he had no proof. In late 1981, Mr. LiCari, feeling that his tests showed the Interjuice concentrate had no apply juice, wrote a memo to Mr. Lavery suggesting Beech-Nut switch suppliers. Mr. Lavery did not respond. Mr. LiCari
Essay #2
Ethical Dilemma Beech-Nut Nutrition Corporation was a division of Squibb Corporation. Its chewing gum segment was profitable but was sold in 1973. Beech-Nut’s baby food division, which had 15% of the baby food market, had never been profitable, and by 1978 creditors were increasingly anxious. Beech-Nut had entered into a contract in 1977 with Interjuice Trading Corporation for Interjuice to furnish apply juice concentrate to Beech-Nut at a price that was 20% below market prices. This contract was a huge break for Beech-Nut because it used apply concentrate in 30% of its baby food products. The Interjuice contract attracted enough attention that Nestlé purchased Beech-Nut in 1979. Jerome J. LiCari was the director of research and development for Beech-Nut. Mr. LiCari and the chemists in his department were concerned about the Interjuice contract for two reasons: (1) rumors of adulteration (substituted product or inferior product) in the apple juice concentrate market were rampant, and (2) the price was simply too good to be true. At that time there were no tests to determine adulteration, but Mr. LiCari sent two of his employees to the Interjuice plant in Queens, New York. Interjuice officials refused to allow them to see processing operations but did provide them access to the plant storage tanks. Mr. LiCari then tried, in 1981, to develop a test for adulteration. He could not, but he took his circumstantial evidence and concerns for Beech-Nut’s reputation to John F. Lavery, Beech-Nut’s head of operations. Mr. LiCari suggested Beech-Nut adopt Gerber’s policy requiring suppliers to establish authenticity or lose their contracts. Mr. Lavery called Mr. LiCari “Chicken Little” and told him he had no proof. In late 1981, Mr. LiCari, feeling that his tests showed the Interjuice concentrate had no apply juice, wrote a memo to Mr. Lavery suggesting Beech-Nut switch suppliers. Mr. Lavery did not respond. Mr. LiCari