Apart from the need to maximize their profits, businesses face the need to be ethical. Principles of business ethics may conflict, and this is when a company finds itself facing an ethical dilemma. It means that any possible decision in such a situation will violate certain ethical principles but will be possibly compliant with other principles (Weiss 96). Ethical decision-making is a crucial process that allows businesses to make the most successful and beneficial decisions. Build & Imagine, a toy-producing company (“What We Play with Matters”), came across an ethical dilemma regarding their targeting. To analyze the dilemma and the way it was managed, it is necessary to summarize the case, describe the company’s reaction and effects on stakeholders, reflect on the success of the ethical decision-making process and the available alternatives, and explore the way managing the dilemma changed the organization.
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Summary of the Dilemma
The dilemma that the company encountered presented two possible courses of action: either to pursue positive impacts on the society or to commit to a business practice that had proved to be effective in terms of sales and profits. The practice was to primarily target boys in the toy production industry (Giang). According to the relevant marketing research, on the findings of which the industry’s participants relied for many years on on, girls were more likely to play with toys designed for boys than boys were likely to play with toys designed for girls. Laurie Peterson, the founder and CEO of Build & Imagine, was familiar with this strategy throughout several years of her work in toy-producing companies (Giang). However, Peterson wanted to implement positive change by creating more girl-oriented toys that could interest young players in science and professions in which there is a gender gap; i.e., in which there are fewer women than men.
Peterson’s initiative was based on the recognition that toys have remarkable potential for engaging children in certain activities that can grow into serious interests and affect the future choice of profession (“What We Play with Matters”). This recognition is supported by research; according to Feaster et al., toys are capable of making players more interested in science (74). However, before founding her own company, Peterson had to suspend this initiative; in this context, she later said, “There I was, year after year, representing this position that the best business decision we can make is to design toys for boys. I was never my authentic self because of that” (Giang). When Build & Imagine was created, the company’s dilemma was either to start developing toys for girls (which could turn out to harm the business) or to commit to developing toys for boys, which had been confirmed to be profitable but was ethically questionable because it excluded girls.
Build & Imagine’s reaction was to choose the first option; i.e., to launch the production of girl-oriented toys even though it was considered an ineffective (in terms of sales) approach in the industry. As Peterson put it, “Instead of designing products for boys and then looking for opportunities to invite girls to play, we’re designing for girls and then looking for opportunities to invite boys to play” (Giang). This decision was based on the acknowledgment that there is a gender gap in the field of science, technology, engineering, and mathematics; i.e., the number of women engaging in professions in the field is significantly smaller than the number of men (Legewie and DiPrete 259). The company wanted to make a positive contribution to solving this problem by “[getting] young girls excited about science” (Giang). This could be achieved by designing toys and games that have female characters capable of becoming role models for young children.
The issue of gender roles promoted by toys has been extensively studied by researchers (Smith). The company’s concern was that toys featuring primarily female characters would be less attractive for boys than toys featuring male characters would be attractive for girls. However, Peterson, an award-winning toy designer, decided to target young girls with more thorough techniques than mere turning the existing boy-oriented construction toys pink; this widespread technique in the toy production industry is something Peterson refers to as “pink think” (“What We Play with Matters”). The company could have expected that it would be less successful than its competitors; from this perspective, the decision Peterson made was unethical because it undermined the effectiveness of the adopted business strategy. However, the company’s leadership opted for a decision they thought was more ethical: to pursue innovation and positive social change.
Effects on Stakeholders
To properly analyze the decision-making process described above, it is primarily necessary to identify the stakeholders in the presented case. First of all, the company itself, including its employees, managers, and leaders, is a stakeholder; second, its suppliers and any other businesses that participated in the process of designing and manufacturing the company’s products (construction toys) are stakeholders, too. Another category of stakeholders consists of potential customers and targets, including not only young children but also their parents who decide on whether to purchase the product or not. Finally, the overall community of the participants of the toy production industry should be identified as a stakeholder as well because it can be argued that the industry as a whole was affected by the business strategy adopted by Build & Imagine.
The company could be expected to lose competitive advantage because it based its business model on the premise that was known to be an unprofitable approach. However, Build & Imagine gained a different competitive advantage: it was the praise it received from critics and customers who appreciated the business model, which helped to further build a favorable image among the company’s targets (“What We Play with Matters”). Therefore, the suppliers and partners received reputational benefits, too; also, the sales were not ultimately as low as it could have been expected, which means that the project turned out profitable after all. Potential customers have received an opportunity to purchase award-winning toys that are capable of not only prompting children to play for hours but also developing their technological, scientific, and mathematical skills. Finally, the entire toy production industry was affected because Build & Imagine changed the standards and showed that refraining from designing toys specifically for girls is not necessarily a profitable strategy.
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I think that Build & Imagine made the right decision. First of all, there are no universally applicable solutions to ethical dilemmas (Weiss 24). Instead, the ethical decision-making process is focused on considering every possible course of action and analyzing the effects of each one of them; the selection of the course of action to be pursued should be based on the considerations of the most beneficial and least harmful outcomes. I understand that adopting a business model that was thought to be unprofitable was not an easy decision for Build & Imagine. For years of work in the industry, Peterson could not have pitched her idea to the leaders of the toy-producing companies she had worked for because there was a strong belief (supported by research findings) that girl-centeredness is less likely to lead to commercial success. This would have been unethical for Peterson to let down her colleagues and managers by proposing to implement a strategy that could harm the business.
Even when she founded her own company, Peterson might have been hesitant about adopting the girl-oriented business model because it meant jeopardizing Build & Imagine’s staff and investors. However, she decided to take the risk and ended up raising the bar in the industry. Toy-producing businesses relied more on boy-oriented products because it was known that girls would be more likely to play with toys designed for boys than boys would be likely to play with toys designed for girls. Build & Imagine has shown that designing toys for girls and promoting the engagement of boys is possible and can make a business that commits to such a business model quite successful. Violating the principles of evidence-based operation and avoidance of negative scenarios and following the principles of innovation and pursuit of positive contribution to society instead have turned out to be wise and ethical decisions.
As it has been stressed above, an important element of the ethical decision-making process is considering every possible decision and analyzing the effects of each of them; in the presented case, the company’s alternative responses should be discussed, too. First of all, Peterson could have based the business model of the new company on the recognition that designing toys for boys specifically but in a way that allows girls to play as well is more likely to be a profitable approach. In this case, the company still could have invented attractive toys that would have been selling well, but the competitive advantage of the favorable image based on girl-centeredness would have been lost in this case.
In another alternative scenario, the company could have adopted the approach to which Peterson refers as “pink think” (“What We Play with Matters”); i.e., it was possible to resort to the conventional methods of targeting girls commonly used by toy-producing companies. If Build & Imagine had pursued this strategy, it would have been producing toys intended to be played with by girls exclusively, and the intention would have been implemented rather clumsily, based on the questionable premise that “girls have an innate predisposition to acquire pink, glittery toys” (Smith). In this case, the company could have succeeded in reaching young girls only and achieving the goal of raising their interest in science, technology, engineering, and mathematics; however, the plan to reach both boys and girls would not have been implemented. Instead, Build & Imagine decided to pursue the effort that was thought to be challenging: designing toys for girls in a way that would invite boys to play as well.
It can be argued that the decision made in the presented ethical dilemma had a major impact on the company’s relationships with its stakeholders. The construction toy designed by Build & Imagine received many positive reviews from critics and customers (“What We Play with Matters”), which improved the image of the company and brought benefits both to the leadership and investors. As the company has confirmed its ability to implement innovations, raise industry standards, and challenge previously used business models, it is now more attractive for investments and has the potential for continuing innovative efforts.
Importantly, the relationships with customers have changed as well. Appreciating Build & Imagine’s effort aimed at making young girls more interested in science and technology, parents are now more likely to prefer the construction toy invented by the company to alternative construction toys that are either designed for boys or designed for girls but in an awkward way; i.e., simply turned pink or covered with glitter. The way the company resolved its ethical dilemma is a major component of communication messages delivered by Build & Imagine to its current and potential customers. This shows that the company is proud of its ethical decision making and bases its customer relations on its ethical decision to a great extent.
Choosing between a business practice of confirmed profitability and practice of confirmed unprofitability but potentially more socially beneficial, Build & Imagine opted for pursuing potential social benefits. It provided the company with an opportunity to be innovative, improve business standards of the toy production industry, and challenge this confirmed unprofitability by inventing new approaches. The company received highly positive feedback from critics and customers, which is why it can be said that Build & Imagine made not only the right ethical choice but also the most ultimately profitable choice.
Feaster, Yvon, et al. “Serious Toys: Three Years of Teaching Computer Science Concepts in K-12 Classrooms.” Proceedings of the 2014 Conference on Innovation & Technology in Computer Science Education, Association for Computing Machinery, 2014, pp. 69-74.
Giang, Vivian. “7 Business Leaders Share How They Solved the Biggest Moral Dilemmas of Their Careers.” Fast Company, 2015, Web.
Legewie, Joscha, and Thomas A. DiPrete. “The High School Environment and the Gender Gap in Science and Engineering.” Sociology of Education, vol. 87, no. 4, 2014, pp. 259-280.
Smith, Michelle. “Barbie for Boys? The Gendered Tyranny of the Toy Store.” The Conversation, 2014, Web.
Weiss, Joseph W. Business Ethics: A Stakeholder and Issues Management Approach. Berrett-Koehler Publishers, 2014.
“What We Play with Matters.” Build & Imagine, Web.