Case: Golden State Industries
Golden State Industries, California’s largest timber company, has been
clear-cutting for over 50 years on its vast holdings which include nearly 2
million acres of the state’s forestland. The company has always
complied with governmental regulations and actively replants the areas
where it logs.
Beginning in the 1970s, various environmental groups have criticized the
company’s policy of clear-cutting, a procedure wherein all the trees in an
area are cut, leaving a patchwork pattern on the mountainsides. Even
though the company replants these areas. the environmentalists feel
that the practice is destructive to the forest and disrupts the entire eco-
system.
Lately, these environmental groups have become more vocal, larger in
size, supported by growing numbers of sympathetic citizens as a result
of social media, as well as more financially viable. As a result, they have
created considerable negative press for the company.
The company used to underplay and ignore these concerns based on
the fact that it provides logging jobs and economically supports the
logging communities. Recently, however, the company has been very
concerned with its public image. A recent company study showed that
the image of the company and its practices has become increasingly
more negative with Californians in particular and with the nation as a
whole. There is some indication that this negative press has reduced
sales in major markets, but an even larger indication that this negative
public sentiment may result in additional government regulation that
would be extremely costly to the company. The company is concerned
about this issue given that clear-cutting also has been named as a
contributing factor in the ongoing disappearance of several endangered
species, including the spotted owl.
Company president Kit Lewis has deeply pondered these concerns and
has asked Vice President of Marketing Sam Fitzgi
ons to create an
image-building program for the company. Ms. Lewis has given Ms.
Fitzgi
ons complete freedom to create an image-building program.
However, she insists that any program will support and publicize her
land donation initiative, i.e., that some land that is not profitable for the
company will be donated to the government as wilderness areas. Ms.
Lewis wants this to be widely promoted through publicity, including
social media, and through paid advertising in both traditional and new
media.
Ms. Fitzgi
ons is not sure about the wisdom of this policy. She fears
that people may see it as a token effort to "buy” public support and,
indirectly, government support. However, she decides to do what Ms.
Lewis has requested, thinking that it will work if it is done right.
Ms. Fitzgi
ons decides to assign the project to Pat Petersen, Pat has
een with the company for three years. He is doing exceptionally well
and has progressed quickly. Pat considers Ms. Fitzgi
ons as his
mentor and, with her support, is on his way to a fast track in upper
management. Ms. Fitzgi
ons discusses the project with Pat. Pat
strongly doubts the wisdom of the land donation aspect of the project
and tries to get out of the assignment based on the fact that he has been
a Nature Conservancy member for the past ten years even though his
participation has been very peripheral and sporadic. When Ms.
FITZGIBBONS hears that Pat is a nature Conservancy member, she is
elated, thinking that this perspective will surely enable them to create the
ight ads. Ms. Fitzgi
ons encourages Pat: “Give it your best shot. I’m
counting on you.