Beech Nut Case Study Human Resources Managment PDF

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CASE TITLE: Beech-Nut’s Bogus Apple Juice CITATION: FACTS: In 1981, Lars Hoyvald joined Beech-Nut. He was the president of the company when there was a financial issue in this competitive food industry. This company has 15 percent of the market share and remained in the second position after Gerber. In 1979, Beech-Nut was acquired by Nestle. Hoyvald had aimed to implement an aggressive marketing strategy. In 1982, Hoyvald found evidence that the babies Apple juice was made by concentrate rather than apples. In 1977, the company was purchased low-cost apple concentrate from Universal Juice Company. Lavery, the vice president of operations found that the blame was correct. This report was dismissed by Lavery but the issues became more serious when a private investigator found that there was only sugared water used in the apple juice. After this incident, the investigator informed Lavery and invited Beech-Nut to join a lawsuit against Universal Juice Company. The staff members suggested to Hoyvald that all suppliers need to be engaged to resolve the issue but the presided was hesitant. He argued that even the just was bogus, but it was not harmful. He promised his Nestle superior that he will return the profit of $7 million for the year. This showed that the company is guilty and admitting that they sold an adulterated product. A recall could cost $3.5 million. Hoyvald said, “I could have called up Switzerland and told them I had just closed the company down. Because that is what would have been the result of it.” After that, Hoyvald implemented an aggressive foreign sales campaign. Hoyvald reported to Nestle that they waste 23,000 cases but the Been-Nut continued to sell bogus apply juice until March 1983.

QUESTION: Suppose you were a Beech-Nut customer. Would you feel wronged by the misbranded product? The lack of a recall? The dumping overseas? Explain your response. DECISION: Yes, I would feel wronged by the misbranded product. I think the main reason was the lack of recall. Because of this issue, the company was not informed quickly. They were remaining failed to break the sale from the market. On the other side, its demand was continuing in different areas as people were not aware of the issue raised. Second, there was a huge quantity of the product in storage, they were determined to get more profit, thus, they continued to sell it. The sale was continued as there was nothing harmful mixed in the apple juice. There was no proof that the juice caused any health issues. Another factor was customer perception. Mostly the customers think that they were no harm in the juice, so they continued their purchases. COURT’S ANALYSIS: The Federal indictment, after one year, charged that Beech-Nut had intentionally shipped adulterated juice to twenty states. The pleas covered acts committed from 1981 to 1983. MY ANALYSIS: According to the business ethics and the development of best practices, the company needs to call all the supplies to inform them what change occurred in their product. Misconduct in such organizations can result in high-level issues for the users. Although this was not harmful to the users, it raised questions on the quality of apple juices. For a proper treatment of such type of ethical issues of business, the decision-making process should be unbiased, and according to the best industry practices to sustain the businesses in the consumer market....