Great Lakes, Great Decisions (Case Study) Essay

Words: 4661
Pages: 19

Executive Summary

I have been requested to evaluate the ethical dilemma surrounding the product offering of Great Lakes Chemical Corporation. The company produces tetraethyl lead (TEL), which is an additive for gasoline. Surmounting studies from the past few decades have proven the extensive harmful effects leaded gasoline has on the environment, which has caused considerable vocal opposition from environmental organizations against the company. The dilemma arises in the fact that TEL is a huge financial success for Great Lakes; the company controls 90% of the market and the product accounts for 59% of their annual profit.

Great Lakes should cease all operations involving the sale of TEL and focus on being a responsible corporate
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Wall Street analysts predict that the revenue from Octel and TEL sales will continue to account for at least half of Great Lakes’ profits for years to come.

* Great Lakes successfully penetrates new markets. They have built a strong overall global presence by identifying areas where both TEL is in demand and the local government permits the sale of this known-to-be-dangerous chemical.

* Great Lakes is financially sound, as evidenced by their outstanding credit rating. In 1995, S&P raised the corporation’s credit rating from AA- to A+.

Ignoring the downfalls of TEL as a consumer good and looking at Great Lakes from purely a business standpoint, these strengths jump off the page as everything a successful company should have. Great Lakes has a solid credit score backed by yearly revenue growth, and have consistently shown the ability to enter new markets and then take over as the leading provider to a global customer base. One of the strengths that warrants further discussion is the fact that Great Lakes controls the TEL market at a near-monopolistic level. This is not necessarily because they have a competitive advantage in the lead additives industry; they have reached market leadership by default due to the ethical issues surrounding TEL and the exit of their competitors from the widely criticized market. Regardless, controlling 90% of your respective industry is something any company would strive to achieve and thus it deserves to be