TO: Board of Directors for Electrocorp FROM: Yessica Alvarez‚ Chief Executive of Electrocorp RE: Analysis of possible plant relocation DATE: October 2‚ 2013 INTRODUCTION: The purpose of this case memo is fully administer an investigation in detail to determine if it is Electrocorp’s best interest to relocate outside of US borders to solve the current decline in profits due to increases in production costs. Investigations will take into account ethical issues that may arise in domestic
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wanting more money and United States regulations becoming stricter; if there are other alternatives to reduce cost and increase profit companies must make a difficult decision to move operations to another state and possibly another country. With Electrocorp needing to alleviate rising costs in labor and production‚ a strategic and well-developed relocation is key to minimize bad publicity and maximize opportunity for a large company that provides on-board electronics of vehicles. The first step in
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The Case of the Plant Relocation By Karen Musalo Production costs are rising. Your company can make more money for shareholders by relocating your plants to a country with lower labour costs and fewer regulations. You are the chief executive of Electrocorp‚ an electronics company‚ which makes the onboard computer components for automobiles. In your production plants‚ complex hydrocarbon solvents are used to clean the chips and other parts that go into the computer components. Some of the solvents
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The case of the plant relocation Options Continue operations in US Move operations to Mexico Move operations to Philippines Move operations to South Africa Facts ( Manufacturing of computer components for automobiles.) Complex hydro-carbons used to clean chips and other parts. Solvent carcinogens must be handled with extreme care. Strike of union workers to raise wages. High wages i.e. $15/hour Safety regulations increasing cost of production. Environmental regulations increasing
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Many of Electrocorp’s competitors have moved their operations to less-developed countries‚ where their operating costs are less than in the United States‚ and you have begun to consider whether to relocate a number of plants to offshore sites. Electrocorp is a major employer in each of the U.S. cities where it is located‚ and you know that a plant closure will cause economic dislocation in these communities. You know that the employees who will be laid off because of plant closures will have difficulty
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TREVINO & NELSON ETHICAL DECISION MAKING (T&N EDM) MODEL INSTRUCTION: DETAILS: 1. Gather the FACTS. Safety doesn’t sale - Trunk space is what sales Standard guidelines for the automotive community were in place 3 teenage girls died Pinto fuel tank had a known issue Product on the market 2 years Cost of replacement gas tank $11 Cost of human life $2000 Received reports that Pinto was exploding (multiple cases) 2. Define the ETHICAL ISSUES (I) in _moral terms_ (e.g.‚ Is X action
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