Corporate Ethical Issues

Link to Article: http://www.forbes.com/sites/scottdavis/2014/02/06/cvss-decision-to-dump-tobacco-delivers-on-its-brand/

CVS Pharmacy has recently taken a large step forward in their industry by making the strategic decision to remove tobacco products from all of their stores in order to show how serious they are about being committed to the health of their customers. Also, for CVS customers that are smokers, they will begin offering free online assistance to help their customers stop smoking if they choose to do so. This was obviously a difficult decision and one that could potentially lose them a lot of money, but they believe that this decision will have the opposite effect, and will actually help them strengthen their brand, retain their current customers, and inspire new customers to come into their stores.

I think this directly relates to the material that we covered in class when it comes to the decisions that departments have to make together regarding the success/failure of their company. A decision like this is obviously not made overnight and is one that can only benefit the company if everyone in the company (all departments) is onboard. In class, we learned that a part of a company’s successful strategy is that “learning and continuous renewal are essential parts of a [successful company’s] strategy.” CVS is choosing to “lead the market” instead of “follow the market” and I believe this will really pay off for them. According to the author of the article, “CVS is “putting its money where its brand is” and has the first mover advantage.”

I also believe this article directly relates to the business simulation we did in class. I think the simulation really showed us how important it is for companies to make important thought out decisions and to not try to be something that they’re not. I also think it proves to us that even though at times it was hard to let go of a product that we have been making for a while, sometimes it was the best decision for the overall health of the company. While CVS could’ve remained successful being in the tobacco industry, they chose to differentiate themselves from their competitors and hopefully help them gain a competitive advantage.

Overall, I believe that this decision was the right one for CVS especially since none of its competitors have really done anything as of yet regarding selling tobacco in their stores (Walgreens?). I believe that in order to make these decisions CVS executives strategically evaluated all of their market segments and made sure to forecast so that in case their revenues did fall dramatically, the company would be able to bounce back. One thing that really stood out to me while doing this simulation is how important forecasting is and how important knowing your market segments are in order to be successful. I feel like my team had a lot of trouble with this in the beginning of the competition and this is what caused us to suffer later on. Knowing your products and knowing the market segments that those products are is extremely important and making sure that all of your departments are working cohesively is just as important.

Do you agree with CVS’s decision to remove tobacco from their stores?
What do you think it’s competitors will do regarding CVS’s decision? Will they drop tobacco products as well?
What else do you think CVS can do to set themselves apart from their competition?
Do you believe this will negatively impact CVS’s business?

Twitter Hoax Causes Market Decline--Washington Post — Twitter Hoax Causes Market Decline–Washington Post

Following a recent slew of high profile Twitter accounts being hacked, the popular social media outlet is beefing up its security efforts. If the company were to allow for the same security measures to remain in place, it would not only be damaging its own reputation, but it’s very operations would be ignoring a major ethical concern surrounding people’s right to privacy.

People are posting more and more of their personal information on the internet and social media outlets for various reasons and in varying capacities every day. Naturally, such a movement has led to a simultaneous leap in presence of hackers. The danger of social media hacking does lie solely in loss of personal data, however.

Individuals are now relying on social media as a primary source of news. Inaccuracies in what is posted by seemingly reputable sources then has the potential to make for major overreactions and misunderstandings. This is evidenced in the recent Twitter hackings of members of the Associated Press (AP) that led to several different incidents of false information being spread via the social media site.

Recently, false posts from a hacked AP account contributed to a stock market decline. A hacker (following the tragic events of the Boston Marathon bombings) posted untrue information regarding an explosion at the White House. He even went so far as to say that President Obama was hurt in the explosion. Reactions to the news led to the aforementioned drop in the S&P 500 that saw a $136 billion dollar decline in market value. This news is especially threatening to Twitter considering it was only a few months ago that the sharing of market-sensitive data was made legal on the social media site.

These sort of issues directly speak to the need for greater security measures to be taken by Twitter to ensure that private information and accounts are not compromised. In response to the recent account hackings, Twitter has begun to take proactive steps to ensure that these sorts of issues do not continue. New security measures are to include a multi-step authentication process that may even include identification codes being sent to account owner’s cell phones that must be utilized in order to be granted access to one’s Twitter account.

The increase in security measures is a great move, but it would appear that such a step is long overdue. As we learned in class, proper planning steps could have addressed the potential for these ethical issues originally and saved the hassle now. Individuals and companies entrust Twitter with personal information with the assumption that they will be protected from hackers and the like. If Twitter or any other site is unable to live up to such assumptions, a very serious ethical issue could cause the reliability and credibility it has attained to be lost.

What other steps can Twitter take? Do reports of these sorts of issues make you wary of the credibility of Twitter sources?

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If CVS Pharmacy Can Say No To Smoking, You Can Too!