Recalcitrant Director Case
In Case Studies
- If I were one of the board members, I would certainly vote for refitting of the temporary plant. The primary reason for that would be the need to save the entire Byte Products, Inc. Despite the possibility of partial income loss due to the technological discrepancy, the plant will only be working for three years, and would be afterwards closed. There would be no need to license Byte’s product and process technology to other manufacturers, either domestic or foreign ones. Another good reason to do so is keeping the production quality control in the company’s hands. Launching the plant for three years would also enable the company to keep the steady prices on their products, i.e. the company will keep its share of the market.
- Considering the fact that Byte wants this plant to work for another three years, administrators of the plant necessarily have to be informed about the plant’s short-term revival. They have to be aware of any details that could help manage the factory in an outstanding manner for the next three years. Informing the future employees about the short period of the plant’s work could lead to some unwanted consequences. Announcing this fact at the time of hiring the workers might cause lack of the work force. People from the local community would be eager to get any job, considering suffering of their area from the job deficit. Potential employees, living beyond the local community, might change their mind once they have learnt about the short time the plant is going to work. The reason to that is that the local authorities will definitely be aware of the Byte’s plans to shut down the plant in 3 years, and they will not be investing in the development of the local infrastructure, as constructing schools, recreation sites etc. Local banks will not be giving away credits for the new employees to buy homes, cars, and so on, as they would understand these people are to lose their jobs in 3 years, and they will experience difficulties repaying the credits in future.
- Small towns, like Plainville, greatly depend on the major businesses, like Byte in this case. Such businesses supply the local people with a place to work. Also, they allow the infrastructure development. Minor financial investments vouch the local communities’ steady development. In case such business decides to shut down its plant, the impact on such towns as Plainville might be devastating. Firstly, most of the town population is usually employed by such companies. They are the ones, paying taxes to maintain the town. In case the plant goes out of business, both the employees and the local community will suffer a considerable loss. Employees will turn jobless and leave the town to seek for a new job. Local government will suffer from the outflow of funds. The town might become quite deserted and go off the map in a few years.
- The compromise could be reached by launching the production in Plainville, and not closing it in 3 years. Number of workers might me reduced slightly, technological equipment can be optimized and modernized, eventually making it state-of-the-art; and in a few more years the plant in Plainville might become one of the Byte’s key manufacture sites.
- If I were Elliot, I would postpone the voting till the next time. Considering the fact that after the discussion with Mr. Williams several board members changed their opinions, the board definitely could not make a unanimous decision. And so far as such an important decision has to be entirely supported by all the board members, I would have done some changes to my proposal and also provided some more solid arguments to support it.