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Health & Safety

Management practices in developing

A case study – By Vijay R. I. Mohan

This essay is an attempt to look at the various issues that can be faced by a traditional

Indian pharmaceutical company (Eucare Pharma) when it decides to go global and start

one of its production facilities in the United Kingdom. The issues widely range from

management policies, marketing conceptions to employee opinions (management’s

perception of employee opinion). Finally remedies are suggested which can possibly help

understand the dilemma and go for a neutral and successful option.

Companies profile:

Eucare pharma is a noted generic drug producer in India, focusing mainly on the mass

production of dermal antiseptics and collagen strips. The product is of high demand in

hospitals as it is used for plastic surgeries and on burn victims.

The company’s production facilities on an average employ around 300 workers on floor

and around 20 managers. Prime focus is given to the marketing department but the QC

and R&D remain last preferences. All the departments come under the direct control of a

Managing director who holds complete authority. The company was able to attain

ISO 9001 status by improper ways which on the long run helped getting it a chunk of the

market share. Bribing for a accreditation is a common practice in companies making high

turnovers in India. Nonetheless, the overall profitability of the company has increased

from US $ 1.5million between 2000-03 to US$3 million between 2004-07.

Seeing the highly profitable cosmetic market in the UK, The managing director decided it

was time to take his company international.

Issues Faced:
At the beginning the main issue concerning the management was finding suitable

employees. There is a sense of ambiguity and confusion amongst the management

whether to recruit people from other nationalities, cultures or to search for the indigenous

crowd in the foreign land.

Secondly. All the higher management posts were held only by men. Women did not even

make up to 1% of the total crowd. In UK this was an issue to address as the government

stresses on equal opportunity to both the sexes. There are also various clauses in the law

which eventually forces the management to recruit non-Indian nationals for minor posts.

Racial profiling was almost mandatory during recruitment procedures, which shows the

intolerant and unreasonable side of the Managing Director.

“In simplest terms, morality may be defined as what is good or right for human beings.

Ethics involves choices in regard to moral precepts. A choice may be ethical or unethical

depending upon whether behavioral rules are obeyed, or whether the choice yields good

or right results for those who are parties to the decision, and perhaps also for "innocent

third parties."” (Hoffman and Moore).

But these morals are highly influenced in the environment in which a person develops his

intellect. If the information he absorbs is going to be biased, so will be his actions.

The obvious business style of this management is probably ethical egoism. An ethical

egoist believes that in business one cannot act on any other basis than self interest and he

views his competitors as the same.

To relate with the system the company opted to go heads on with the competitors and

geared up for complete overhaul as they employed two Japanese consultants to sort out

the functioning of the production and management facilities. The Japanese style of

business was a complete disaster as they believed in utilitarianism and were against the

monopolistic powers of a single MD. The changes they suggested on the operations were

put to place but the style of business would not be changed.

I had the opportunity of working with the company for 6 months as an intern in the R&D

department. I was recruited as the team leader for the quality control eventually as the

MD was known personally to me, and not because I deserved it. Seniority and experience

come only second to influence you have directly on the management. Canvassing and

smooth talk could gain one higher regard than one who actually raises the issues
concerning the facility. I exploited the chance given to me and was able to change a few

system flaws on the floor. I stressed on getting the product copyrighted before the

company went global and after a few years of convincing it had got results.

After the “failure” of the Japanese consultants, the management focused on growing the

companies profile in the market. As it had always relied on its marketing team the MD

had complete confidence in success. The marketers and the sales representatives had been

recruited from other branches from India. The complete ignorance of UK market and

poor research coupled with traditional marketing techniques lead to disastrous results in

the first quarter of business year. The MD was clueless about what went wrong but all he

wanted was results and profit. So acting as per his ethical egoist nature, he scrapped away

all the policies against recruiting non-Indian nationals, and focused primarily on profits.

This was a rude awakening for him as against his best wishes the company had to recruit

more than 200 workers belonging to different nationalities, more than 70 of whom were

women. All the sales reps previously employed were put on training under a scholarly

consultant, and experienced professionals took their place. The traditional manufacturing

procedures have not been changed to date but the overhaul had resulted in the

management getting a better idea about the market structure and ways to address it. Right

now it has been almost 2 years since the company entered the UK market. The profits and

the reputation have started to grow. Little change have been made on the management

policies as traditional system have bore them great business and the decision maker cant

risk changing it. “When entrepreneurs are unimpeded by legal or self-imposed moral

constraint to protect the good of others, they are able to promote their own good and, as a

result, provide the most efficient means of promoting the good of others”(Baier, 1991, p.

201; see MacKinnon, p. 24).

Firstly I must say that there may be flaws in running a business where one hand rules

them all. But in theory if the overall objectives and the plans of business are not

compromised, it does bear results. There should be more open-mindedness when one

plans to get into a global venture. Steadfastness and persistence not rigidity takes a

business forward. The MD was flexible but only when his primary plans failed. The

“golden rule” is applicable in whatever ethics one follows. But as John C. Maxwell put it

“There's No Such Thing as Business Ethics, people can live with integrity by using the

Golden Rule as their standard-regardless of religion, culture, or circumstances. Along the

way, one delves into the desires of the human heart, reveals the most common causes that

get people off track ethically, and how one develops the Midas touch when it comes to

Baier, Kurt. 1991. "Egoism" in A Companion to Ethics (ed. Singer). Oxford:

Blackwell. 197-204

There's No Such Thing As "Business" Ethics : There's Only One Rule for Making

Decisions John C. Maxwell

W. Michael Hoffman and Jennifer Mills Moore in Business Ethics: Readings and

Cases in Corporate Morality (McGraw-Hill, Inc., New York, 1990

Ethics in Business Richard A. Stanford

Articles by MacKinnon et al.