The Case Of Sexual Harassment At Ford Motor And Its Impact On The Company
In two of the Ford Motor Company’s factories centered in Chicago, 33 women have come forward and filed a class action lawsuit on the bases of sexual harassment. These women have stated that they have been groped, have had sexual vulgar comments made towards them, have suffered from sexual violence, and even have dealt with racial slurs. While this is a shocking issue, this is not the first as these two specific plants have a history of these items being present for almost three decades with prior lawsuits being made and millions of dollars being paid in settlements. If these issues continue to persist, the company can be impacted severely specifically the areas of manufacturing, HR, and management. Furthermore, it can have a negative PR which can lead to a decline in sales, and stock prices. However, there are still measures that can be taken to correct and prevent further similar issues from arising.
As previously stated, if these actions continue and are not corrected it can have severe internal issues on the company. Employee backlash can affect manufacturing as employees can take a stance alongside the victims and go on a strike, or not show up to work which can halt production and in 2018 the Ford Motor Company produced one new car roughly every ten seconds. So, halting or slowing down production can result in millions of dollars in loss when it is done on a mass scale, and with the United Automobile Workers Union, a country wide strike or resistance to production can massively impact production and sales. Also, the Human Resources department can be impacted in the sense that they can have people within the department who will push for the victims to obtain justice, as well as holding the men accountable for their actions. HR can also push for holding people within their department accountable as the HR reps who were at these factories did nothing to resolve these issues or obtain further help to correct the issues. Furthermore, management can have turnover as HR holds these people accountable for not escalating the issues.
Also, management failure to do anything can bring about the questions if there is enough diversity in the management chain seeing as the majority of the victims are women of color. So, the overall negative PR of this lawsuit can have direct impact on turnover, and production which can both be immensely costly towards the company’s image, and direct dollar figures. Overall, the internal conflicts that may come from the women workforce in the company aligning with the victims can cost the company millions of dollars as women account for nearly 30% of the workforce at Ford Motor Company. As previously stated, these issues have been ongoing at these two plants for almost three decades and lawsuits totaling $35 million and while these lawsuits do not account for lost time of production, employee turnover, or negative publicity, this is still a hefty sum. One can look at this and say, “well this never caused any more issues or got a big movement before why would it now?” Well, the simple answer is the internet, there is much more word of mouth now and things are known a lot quicker. Also, the whole movement and culture behind urging women to speak up and supporting each other as well as men supporting them is at an all-time high and only gaining more steam. So, these issues can easily have a bigger chain of reaction than it did during the first lawsuits and allegations during the 1990s and early 2000s when information traveled a lot slower.
Further impacts as a result of this case can be on items that directly impact earnings. One category that can result in a decline due to negative PR is a loss in sales as consumers would prefer to not associate themselves with a company that allows this. Women as well as men can choose to sway their purchase decisions towards other auto brands as they do not condone sexual harassment and are seeing as the Ford Motor Company has had these issues ongoing in the same plants for nearly three decades. In 2018, women accounted for roughly 65% of auto sales in the United States and seeing as how this is a case where women are the victims, they are more likely to condone Ford for their failure to protect these women by boycotting the brand and becoming customers of another brand. Also, while women accounted for roughly 65% of auto sales, their influence impacted a total of roughly 80% of auto sales in the country as they factored in influences on significant others as well as family and friends. Women are clearly a huge part of the market and have a significant overall impact when it comes to auto sales so losing a significant number of women can results in billions of dollars in lost revenue.
Also, a big area of possible loss could be fleet and commercial contracts. Many companies use Ford cars for their companies and if consumers are staying away from Ford, then these companies might be inclined to use other auto brands for their companies as they would not want to risk being seen as supporting a company that allowed sexual harassment to occur for such a long time. So, a negative view by the public as well as fleet and commercial vehicle sales declining can result in stock prices dropping which can cause even more issues in terms of revenue. Overall this case and the negative attention it draws to the company can result in a loss of sales bother commercial and fleet, as well as a decline in stock prices and number of shares sold as which can both cause a negative impact to earnings. However, there is still time to solve these issues and prevent further negative backlash.
In order to prevent these issues, the Ford Motor Company will need to have a strong stance on this issue. First and foremost, the victims must receive their compensation and justice that they deserve being as this was not a light issue and their suffering was something serious. Ford must also hold all the people involved accountable, they must hold the men directly involved in this harassment accountable, as well as holding upper level management and HR reps accountable who were aware and did nothing to protect these women. This must result in terminations of these men as this type of behavior and culture should be unacceptable. Also, there must be a new clear code of conduct set for all employees, and a training to go along with this. There needs to be clear punishments for breaking these codes of conduct as well. Furthermore, there must be diversity in the new management and HR reps that are brought in to have different viewpoints than that of traditional managers. Also, Ford must work alongside outside organizations that help protect women in the workplace in order to help further ensure that women are being treated equally and have a discrete way of reporting issues without the fear of favoritism from Ford managers towards the men or the company. Overall, Ford needs to ensure that there is a change of culture and the Ford Motor Company is no longer a place just for men to work because this is a new era and going forward women will be joining the workforce more and more as time goes on. Holding people accountable for their actions will show the public that Ford is serious on these issues. Setting new codes of conducts and providing training will set the clear expectations for employees when it comes to proper conduct in the work place. Bringing in new and diverse replacements for the people that were let go will usher in a new feeling and culture of not standing with sexual harassment. Working with outside organizations will further show Ford’s commitment to not allowing detrimental conduct to continue within the company. So, overall Ford can take these measures in order to ensure that sexual harassment does not persist in the workplace while at the same time improving PR on this issue.
This case is a very tragic one being as women were sexually harassed at the same two plants for three decades, and not to mention a lifetime of emotional scaring over these issues. This case can not only impact Fords earnings when it comes to sales loss, market loss, stock price decline, shares decline, but also can have a negative impact internally. Employees may not view Ford the same which can lead to a loss in production time as well as a cost of employee turnover. When factoring in internal and external impacts that this case can bring, the cost can be in millions and even billions of losses in revenue over an extended period of time. However, Ford can take measures to improve PR and save the loss of some revenue, while also taking drastic measure to ensure that these issues of detrimental conduct do not repeat themselves years down the road. All in all, the Ford Motor Company needs to take a stance and support the victims and protect women in the workplace from sexual discrimination and attack a major issue the moment it arises and not wait decades like they did in this case.
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