Analysis of the short-term implications include making some

Analysis of the Problem

The problem of Volvo’s crushing blow started with the lawsuit that the Texas’ Attorney General, James Mattox filed against the Corporation on their “Bear Foot” promotion (Green, 1990). Mattox argued that the company’s advertisement came after the production personnel did reinforcement of the Volvos; therefore, the practice was not ethical. In addition, he termed the ads as a deception and a trick.

His intention was not clear as to whether the charges he pressed against the corporation resulted from the public outcry or was simply a personal interest. In a quick and sharp reaction, the company withdrew the advertisement and started running others as a corrective measures. By agreeing to withdraw the advertisement and refund the $316,250 legal fee and investigation costs, to the office of the attorney general, it meant something was wrong with the advertisement (Green, 1990). Basically, the modifications, which were made on the filmed cars, were fictitious and misleading. In essence, there was an ethical deception through making alterations, which signified the strength of the Volvo car.

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Literally, the main problem was that the alterations were made without consultation, because even the officials of the advertising agency were not aware that certain alterations could be made to communicate a contentious impression. The other controversy involved the person who was to be responsible for the impression. Basically, the corporation had no intention to produce such misleading advertisement. Scali also did not deserve bearing the responsibility, because the advertisement was done by a different production company that they hired (Green, 1990). The claim that Scali knew the fake modification was unethical, because there were no evidence brought to implicate the agency for having knowledge of the alterations, before the release.


Considering the advertisement, there are recommendations for both the attorney, Volvo Corporation and the Advertisement Agency should do about the matter.

First, the Attorney General should consider conducting another fresh investigation to determine the reality concerning the matter, before making the charges against the corporation (Howel, 2010). Here, He should obtain clear and convincing evidence about the person, who made the misleading alterations and the official, who authorized the same. Legally, it was a breach of business ethics for the advertisement producer to manipulate the public opinion to believe that Volvo was actually superior (Crane & Matten, 2010). Second, Volvo Corporation should apologize to the public for deceptive information, which was communicated unduly in favor of the company.

It is beyond the logics and ethics in business to assume dominance of the brand, through cheating (Crane & Matten, 2010). Despite some consumers acknowledging that Volvo is, indeed a wonderful car, it was not enough to assume that all the consumers are satisfied with the products. While the consumer’s comments on the quality of the car were within the business ethics, the advertisement manipulation, to convey the information is actually unethical and illogical (Crane & Matten, 2010). Third, Scali agency should investigate the malpractice that went behind their back. Claiming that the manipulations were done at their back, indicated that, they threw the blame on the Perretti Production for the modifications.

Since they were contracted by the company to make the advertisements, they had the responsibility to make sure that it obeyed the rules and was done based on ethical considerations (Howel, 2010). Perhaps, Perretti Productions is the most reliable company for the modifications. Therefore, they had to be clear on the reasons for modifying the advertisement. In case they were acting under an authority, they are obliged to tell the truth so that the stalemate could be resolved.

Implications of the recommendations

The recommendations will create far reaching impacts in the operations within the organization.

As well, there would be short-term and possibly long-term effects, which might need management restructuring, and procedural changes on their tendering process. Some of the short-term implications include making some urgent and stringent guidelines, especially on sub contraction, launching new campaigns, launching advertisements, and management’s responsibility. On sub contraction, the agencies to be hired for other technical duties have to prove their reliability. This would mean that the company has to take more time in selecting the suitable agency to perform such tasks.

Before launching the new campaign, the company has to be versed with the content and its impacts. Besides, they have to pre-empt the reactions from the public, the experts and other legal implications of the campaign. In addition, prior to launching a new advertisement, the company has to be aware of the content, meaning that they have to conduct a pre-launch test to make sure that the right information is contained in the advertisement. Alternatively, the long-tern implications include altering the company policy to ensure accountability. The company would be forced to adjust the tendering process, in a manner that guarantees the quality of the output. In addition, the company would be compelled to make changes on the management to increase their interaction with the stakeholders. This implies that the role of the management will change significantly, as a way of creating an avenue for the desired results. Therefore, there might be increase in the supervisory duties for the company management.


Crane, A. & Matten, D. (2010). Business Ethics. Oxford: Oxford University Press. Green, R. M.

(1990). “Volvo’s Crushing Blow.” Communication in Business. (Case Study). Howel, R. (2010).

“Choosing Ethical Theories and Principles.” International Journal of Transdisciplinary Research. 5 (1):1-28.


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