An Ethical Analysis of the McKinstry Advertising Agency Case

     1. Case Facts

McKinstry Advertising Agency is a medium-sized company. It focuses on various functions, including preparation of market strategies, conducting market research, arrangement of distribution channels, as well as devising advertising and promotion materials. McKinstry’s main clients are industrial companies, which sell to government agencies and other manufacturing companies. The clients depend primarily on the advice acquired from McKinstry’s advertising specialists and account executives.

The company is facing issues based on personal and permanent linkages. They are founded on the reason that clients have a tendency of developing relationships with individuals who are constant members of personal and permanent workers. The problem arose after one of the company’s larger customers developed a novel kind of radar detectors. Referred to as “fuzzbusters”, radar detectors are sensitive radio receivers with purpose to inform the driver to reduce the speed prior to the calculation of the car’s velocity by the police equipment. Therefore, they escape police stopping and fines as a result of speeding.

Though radar detectors have been evidenced to cause traffic accidents, severe injuries and deaths, their manufacturing and selling are not prohibited by the federal government. Besides, the majority of states do not allow the use of radar detectors, but the U.S. Constitution bans interstate import restrictions. A situation occurs in which a state prohibits the employment of radar detectors, but their manufacturing and selling are not illegal.

Radar detectors became ineffective after the police started using lasers in various states to stop speeders. The majority of radar detectors lacked the capability of catching light waves. As a response, one of McKinstry’s clients developed a novel technology with the ability of light waves reception, therefore, warning drivers to reduce speed. For the purpose of marketing, the electronics company approached McKinstry and sought for the development of a marketing plan backed by market research. Additionally, the client asked for the services of Marilynn Schaefer, an associate who had earlier planned a thriving advertising program for them. Marilynn, who was given the responsibility of designing promotion materials, declined citing ethical issues. According to her, marketing the laser detectors was not right as they caused countless traffic accidents resulting in suffering, injury and deaths. In spite of the efforts of the program director to assign other personnel at the same level as Marilynn to carry out the assignment, the client’s representative declined all other offers. Marilynn refusal resulted in a conflict between her and George Sarbo, the account executive, to the extent that she was fired. Knowing her rights, she approached McKinstry’s president claiming that it was wrong dismissing an individual due to her moral beliefs. In response, George argued of the firm’s policy of offering personalized service to clients. He maintained his stand of firing Marilynn by the fact that she was not willing to offer her services to the client. George also threatened of leaving the company if the associate was retained. If George left the firm, it was certain that he would go with his already established and loyal customers. Moreover, he would leave a vacant place considering that McKinstry has just three account executives. As a result, the client, George and Marilynn changed their positions despite of the conversations they held with the president.

     2. Ethical Issues

McKinstry Advertising Agency case presents various ethical issues. The president, who is the decision-maker in this case, has to accommodate various conflicting demands. The president has a duty to meet the demands of the company’s customers considering that they are the most important aspects. It is generally said that “customers are the boss” in any business. As a result, the president is responsible for acting in the client’s best interests. He should ensure that the clients obtain the personalized services they desire. However, the president is also responsible for the company’s staff. Certainly, firing an employee based on her moral beliefs is not right. On the other hand, forcing the associate to devise promotion materials for the laser detectors would be against her morals. There is also a high possibility that the electronics firm would leave the advertising agency if its desire is not granted. However, retaining Marilynn would mean the loss of one of the most important account executive in McKinstry Advertising Agency, as well as his loyal clients. It would be detrimental for the company. In addition, promoting the laser detectors would mean increased sales and, eventually, amplified traffic accidents.

     3. Ethical Dilemma

The ethical dilemma faced by the president is:

“To retain the associate (Marilynn) in the advertising agency”

Or

“Not to retain the associate (Marilynn) in the advertising agency”

The president is the overall head of the advertising agency. Consequently, he is responsible for making vital decisions for the successful running of the company. However, taking each alternative of the ethical dilemmas exposes McKinstry Advertising Agency to detrimental outcomes. The first alternative, which is to retain Marilynn in the agency, implies that McKinstry would lose one of the most important account executives. Additionally, the agency would lose various clients who are loyal to the executive. Losing customers is a major problem for any company. On the other hand, retaining Marilynn would indicate that the agency values its employee’s moral beliefs, therefore, gain their devotion and commitment. The second alternative, which is not to retain Marilynn, means that George would not leave the agency. Such decision would guarantee retention of McKinstry’s loyal clients. However, it would also damage the agencies reputation from its employees who would feel that they are coerced. In most cases, such employees may contemplate leaving the agency and look for positions in other companies where their moral beliefs are valued. In both alternatives, there is a high probability of the electronics firm leaving, considering that it would not receive the services of Marilynn. However, by not retaining the associate, the client’s representative may consider the services of another employee recommended by the program director. In fact, the client’s representative considered that he was “owed” Marilynn’s help in the current project.

     4. Ethical Analysis

4.1 Utilitarian Approach

Utilitarian approach provides a technique of making decisions on the most appropriate course of action in any kind of ethical dilemma. It considers happiness of the majority of individuals affected by the issue. By measuring, evaluating and comparing the impacts (benefits and harms), the decision-maker is able to choose the best alternative that is beneficial for the greatest number of individuals. In current case, individuals who would be affected include:

• The agency’s president;
• The associate (Marilynn Schaefer);
• The account executive (George Sarbo);
• McKinstry Advertising Agency;
• The electronics firm (client);
• The general public.

4.1.1 The Effects of Retaining the Associate in the McKinstry Advertising Agency

To start with, the president will exhibit his dedication to observing his employee’s moral beliefs. It will be a key motivation factor to other staff who will consider that they are respected and valued. The action has a high likelihood of improving organizational productivity both in short-term and long-term perspective. Besides, retaining the associate would also mean the electronics firm withdrawing from the company as its best interest is not considered. As a result, the agency would lose one of its largest clients, which may be detrimental. The account executive would also leave the agency, certainly with his loyal customers. The company would suffer in the short-term both by losing a useful employee, as well as a number of clients. Nevertheless, such issue would be solved in the long-term by looking for new clients. By not devising the promotion materials for laser detectors, McKinstry would probably save many public lives.

4.1.2 The Effects of not Retaining the Associate

By not retaining Marilynn, the client’s representative would probably consider employing the services of another associate provided by the program director. However, the president would act against the moral beliefs of his employee and it may impact the motivation of other staff, reducing their effectiveness and productivity. On the other hand, the account executive would also remain in the agency, and it is beneficial factor considering that he is among the only three executives in McKinstry, with a range of established loyal clientele.

Utilitarianism ensures that the ethical alternative is the one that offers the greatest good to the largest number of individuals. In current case, the best alternative is retaining Marilynn in the agency. McKinstry will suffer short-term inconveniences by losing one staff member and some loyal clients. Nevertheless, the benefits of retaining the associate will restore the agency’s image and reputation resulting in long-term impacts.

4.2 Kantian Approach

According to a given approach, the dignity of rational beings should always be respected while making a decision without considering the involved impacts. Therefore, the president’s intention must be directed at whom the prime duty is owed, the electronics firm. A corporation ought to always work in the best interest of its clients, as they are the ones guaranteeing its survival. The Kantian approach is explored by explaining alternative maxims and testing them using the Categorical Imperative (CI). The maxims for the president in current case are to:

“To always serve the best interests of the clients”

Or

“To never serve the best interests of the clients”

The maxim considered by the decision-maker must be the one that passes the CI.

4.3 Rights Approach

The rights approach is based on the fact that individuals have the right of choosing freely for themselves. They also have a basic moral right that such choices should be respected by others. While making a decision based on such approach, the decision-maker must consider the moral rights of all the involved people. It is certain that where rights exist, conflicts also arise. The rights approach focuses on categorizing the involved rights and prioritizing them with respect to the hierarchy of significance in descending order. In current case, the rights involved encompass:

• The president’s negative right to make a decision, which compels other parties to respect such decision;
• The associate’s negative right to make her own decision based on her moral beliefs, which prevents other parties from manipulating them;
• The account’s executive negative right to make a decision to leave the agency, which requires other parties not to stop him from leaving;
• The client’s representative negative right to demand for personalized service, which obliges the others not to go against their will.

From the rights approach, it is certain that there is no conflict of basic rights. With reference to this, the president has the right of choosing between the two ethical dilemma alternatives.

4.4 Distributive Justice Approach

The approach focuses on fair sharing of the societal benefits and harms. It involves respecting other rational beings and valuing the good of others, as well as one’s own. While making a decision in a given case, the decision-maker must consider the party that is mostly affected negatively. In McKinstry case, the most affected parties include:

• The agency that might lose some of its potential clients;
• The agency may that lose its trusted employees;
• The employees who may lose trust in the agency;
• The president who is compelled to make a decision that leads to negative impacts.

McKinstry Advertising Agency is faced by the problem of losing some of its potential clients and staff. In addition, the employees may lose their trust in the agency. Therefore, the approach requires the president to select the ethical dilemma alternative that meets the best interests of the agency. The alternative that should be chosen is not retaining the associate, as it results in the losing of McKinstry clients and one of its important account executive.

     5. Recommendations

The decision that the president should take is to retain the associate in the McKinstry Advertising Agency. Although it has a short-term impact, such as loss of clients and one of the employees, it could yield long-term positive impacts contributed by the staff dedication.

Moreover, the president should consider convincing the electronics firm to take the services of another associate proposed by the program director on the basis that Marilynn was working on other accounts.

Finally, the president should prove the account executive the significance of respecting employees’ moral beliefs.