Management Information System

MM2711 Introduction to marketing

Individual assignment

Student name: RONG Rundu

Student ID: 13116563D

Tutorial number: TUT001

Group number: Group 1

Introduction

Marketing ethics is the applied ethics related to the moral principles behind the regulation and operation of marketing, which is beneficial to the society both in short term and long term (Barron’s Educational Series, 2007). Some companies may disobey the marketing ethics codes in order to purse the higher profit.

Background

Shanghai Husi Food Co. Ltd, one of the subsidiaries of OSL Group owned by US, was founded in 1996 based on the consideration of long-term development in China. Shanghai Husi Food is a large meat and vegetable processing company with chicken, beef and pork processing production lines. However, there are some unethical issues found about Husi. Firstly, Husi once used harmful expired raw materials to be processed and provided them to McDonald’s and KFC, which was seriously harmful to the public health (Sophie, 2014). Secondly, Shanghai Husi try to cover up the production line with expired raw materials to build a gloss that everything is in good order before its customers visit and inspect, such as KFC and McDonald (Adolfo, 2014). Based on American Marketing Association (AMA), the issues are unethical and disobey two ethical values, which are responsibility and honesty.

Responsibility

Shanghai Husi violated ethical value of responsibility because it failed to accept the consequences of its marketing strategies and decisions. On 20 July 2014, shanghai TV news channel reported that Shanghai Husi company provided expired raw materials to McDonald’s and KFC. According to media reports, in order to reduce the production cost, the company planned to use 18 tons of raw materials to produce McNuggets, which contained a large number of overdue goose and chicken breasts and these raw materials have expired for nearly half a month (Sophie, 2014). According to Laurie (2014), eating expired food may result in food poisoning and the symptoms may be fever, frequent vomiting or dizziness. The company’s behavior of using expired meat to boost production and reduce cost failed to acknowledge the social obligation of protecting the health of public, so it violated the ethic value of responsibility.

As a large food processing company, Shanghai Husi should take responsibility for the public health instead of only pursuing the minimum of production cost. In addition, the company should dispose the expired raw materials as soon as possible and try to take measures to acquire the public trust again.

Honest

Shanghai Husi also violated ethical value of honest because the company failed to be forthright in dealing with stakeholders. Shanghai Husi is the processing food supplier of McDonald and KFC. According to convention, the customers of Husi, such as KFC, would visit and inspect Shanghai Husi in order to strengthen the management of their suppliers. However, the reporter discovered that on the day before examination, the quality control department of Husi would inform the production plant to take away the expired raw materials and defective products (Adolfo, 2014). As a result, the inspectors would see a gloss that there was fresh meat processed by properly attired workers and could not discover any expired raw materials. If the inspectors came to inspect on an unannounced day, a large number of plastic bags filled with overdue meat would be found (Adolfo, 2014). Shanghai Husi failed to offer fresh and healthy products that they promised in the communications with its customers, so the company violated the ethical value of honest.