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Week 1: Case Study Analysis

Table of Contents

Case Summary............................................................................................................................ 3

Why would ethics be important to a company like J.M. Smucker? How can its focus on values

and ethics improve its business performance?............................................................................4

What do you feel are the benefits and drawbacks to being on this type of list? Do you think that

it is generally beneficial to be publicly recognized as a good employer? Why or why not?..........5

Do J.M. Smucker’s values and culture appeal to you as a potential employee? Why or why not?

.................................................................................................................................................... 6

Conclusion................................................................................................................................... 6

References.................................................................................................................................. 8
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Week 1: Case Study Analysis

Case Summary

J.M. Smucker Company was founded in 1897 in Orrville, Ohio with the aim of providing

signature comfort foods like fruit spreads, frostings, juices, and beverages to the American

market. Right from its inception, when founder Jerome Monroe Smucker sold apple butter from

the back of a horse drawn wagon, the company was built on equality, integrity, reverence,

conviction, and accountability.

To ensure that the company maintains its reputation as a highly ethical organization,

Smucker has persevered to employing personnel who possess a strong value system. They

evaluate possible candidates against a very ardent ethical yardstick and employment is based

on meticulous reference checks. All new employees must undergo a rigorous training schedule

which imbibes the very essence of the values the company is based on. They are trained to see

beyond the black and white of right and wrong and taught to focus to “the right thing to do”.

Smucker’s commitment to ethics does not end at orientation. All employees are expected to

retrain every two years and must sign a detailed nine-page ethics statement every year to

ensure that they live up to the standards expected by the company.

Fortune Magazine has often included Smucker Company in their “100 Best Places to

Work For” list largely due to their outstanding organizational culture. Besides being an

exceptional morally rich organization, Smucker is also a pioneer in promoting in environmental

and social sustainability. They fulfil their corporate environmental responsibility by recycling

resources, using renewable energy and sustainable raw materials, along with enhancing

wastewater management, using, and reusing resources rather than consuming new ones.
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Why would ethics be important to a company like J.M. Smucker? How can its focus on

values and ethics improve its business performance?

By definition, business ethics refers to the moral standards for conduct in a business.

“Corporations establish business ethics to promote integrity among their employees and gain

trust from key stakeholders, such as investors and consumers” (Vitell, Paolillo, & Thomas,

2003). An organization like Smucker, whose core clientele is people who have been using their

products for generations, look up to them as a trusted brand. With the consumable markets

industry being so competitive, all it takes for an organization is to lose consumer is a few bad

reviews. To maintain consumer loyalty, a company like Smucker must uphold their ethical

practices. They have been proactive in identifying what is important to their consumers and their

target market in general and therefore have made a mark as an ethical company.

Another reason why business ethics is important, is that it can improve profitability. “As

with all business initiatives, the ethical operation of a company is directly related to profitability in

both the short and long term” (Horton, 2020). Customers that are highly satisfied and highly

loyal to organizations are much more profitable than other less loyal customers because they

bring in more revenue. Businesses with a loyal customer base don’t require marketing gimmicks

or need aggressive sales tactics to attract customers from their competitors. By focusing on

focus on values and ethics Smucker can build a loyal customer base and will therefore not need

to invest their financial resources in expensive marketing and sales stratagems.

High standards of organizational ethics can contribute to profitability by reducing the cost

of business operations and building a foundation of trust with stakeholders. An organization’s

reputation is a key factor in establishing its value to an investor. Businesses who fail to meet

ethical standards are never looked upon as a worthwhile investment. Investors are less likely to

invest in a business that is perceived to operate unethically.

What do you feel are the benefits and drawbacks to being on this type of list? Do you

think that it is generally beneficial to be publicly recognized as a good employer? Why or

why not?

Being a part of “best places to work” lists is a double-edged sword. On one hand

businesses on these lists get great exposure to the job market which enhances their talent

pipeline and increases their employee retention rates. Customers always want to work with

businesses that treat their employees well. From a marketing perspective, featuring in such lists

is the ‘cherry on the cake’. On the other hand, a major drawback of appearing on lists like these

is that it put a spotlight on the business. When a business is in the public eye, it is heavily

scrutinized, where one wrong move could break years’ worth of goodwill and reputation. For a

business, like Smucker, negative publicity could mean the end of their business altogether.

From a HR and recruitment standpoint, being in the best list limelight will mean more people

seeking employment with the business. This will put an excess pressure on the business’s

resources.

For any business, being publicly recognized as a good employer is always beneficial.

The best workplaces attract the best talent and being recognized as a good employer boosts

employee morale thereby increasing employee retention. They are perceived to be more

valuable, which frequently allows them to charge a premium for their product or service. Their

loyal customer base buy a broader range of products and services and are more inclined to

trying any new offerings the business may introduce. “Businesses with a good market reputation

are also perceived to deliver continual earnings and steady growth, they have higher market

values and lower costs of capital” (Etheredge, 1999).

Do J.M. Smucker’s values and culture appeal to you as a potential employee? Why or

why not?

J.M. Smucker’s values and culture definitely appeals to me, as it should to anyone who

looks forwards to having a rewarding career. Smucker has created an environment free of

malpractices like harassment or discrimination by instilling moral values within their staff. Their

process of hiring employees with a strong value system and training employees to treat each

other ethically ensures employees are happier at work. “Keeping employees happy reduces

turnover, increases productivity and makes it easier to attract talented new hires” (Horton,

2020). As an employee, having a sense of pride for the company you work in is one of the top

motivating factors. If I think my company is doing the right thing and I get to be a part of

something that’s making a difference, it will instill a feeling of pride and loyalty within me and

ultimately make me feel happier. Ethical behavior and job satisfaction are codependent. Ethical

behavior fosters job satisfaction and job satisfaction encourages ethical behavior. Being

influenced by a positive ethical organizational culture will ensure I endure to strive to uphold the

same high standard I am subjected to.

Conclusion

For a business that is over a century old, Smucker has a solid foundation of profitability

and corporate responsibility. “There is a fine line between making decisions for financial gain

and making choices that will not adversely affect others. The ethical business knows the

difference” (Phillips, 2019). They have maintained their commitment to being a morally rich

organization by ensuring all Smucker employees follow company standard ethical policies.

“Smucker promotes social sustainability in the communities in which it operates, promoting

initiatives and programs that support and enhance the quality of life” (Griffin, Phillips, & Gully,

2020). They recognize the significance of their relationships with people, communities and

society as a whole and propagate initiatives that make a difference. As a whole, their
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exceptional organizational culture and a strong sense of social responsibility is what makes

them industry leaders. They have rightly earned their loyal fanbase and their place on Fortune

Magazine’s “100 Best Places to Work For” list.

References

Etheredge, J. M. (1999). The perceived role of ethics and social responsibility: An alternative

scale structure. Journal of Business Ethics, 18(1), 51-64.

Griffin, R. W., Phillips, J., & Gully, S. M. (2020). Organizational behavior: Managing people and

organizations. Boston, MA: Cengage.

Horton, M. (2020, August 28). Why Are Business Ethics Important? Retrieved from

https://www.investopedia.com/ask/answers/040815/why-are-business-ethics-

important.asp

Phillips, C. (2019, February 01). Six Characteristics of an Ethical Business. Retrieved from

https://smallbusiness.chron.com/six-characteristics-ethical-business-22401.html

Vitell, S. J., Paolillo, J. G., & Thomas, J. L. (2003). The perceived role of ethics and social

responsibility: A study of marketing professionals. Business Ethics Quarterly, 13(1), 63-

86.