Vertical Integration Strategy Essay Example | Topics and Well Written Essays - 750 words

Vertical Integration Strategy - Essay Example In adapting its strategies to market conditions, Smithfield has taken a cost leadership strategy, combined it with a differentiation strategy (lean pork) where it has a proprietary advantage, and made an efficient value chain as the case study demonstrates (Thompson, Strickland, & Gamble, 2008, p. C-429). As a leader in the concept of bringing efficiency to vertical integration, the company has combined farming, feeding, processing, and distribution into an award-winning, highly profitable operation. The next logical step for the company is to expand its operations to bring more capacity and higher profitability. The problem is that community in which it seeks to build does not want any more pig farms for a host of reasons; not the least of which is the natural but noxious result of raising livestock. In terms of the ethical and socially responsible business practices, the company has some specific issues. One of these is that in some ways, management seems to be out of touch with th e real issues. One of the environmental efforts touted by the organization is its contribution to wetlands recovery, as well as recycling cardboard. These are worthy things to do, certainly, but the company position on these issues is not relevant to the more pressing issues it is facing. As one author notes, to â€Å"address ethics problems, managers first have to recognize that conflicts of interest exist† (Vickers, 2005, p. 26). With all due respect to the organization, touting its recycling efforts and energy conservation efforts is insufficient. Under a strict utilitarian analysis, the company has no real moral duty and fairs relatively well with the argument that its actions benefit more people (international food supplier, working to reduce fat in the American diet) than those few North Carolina residents who are hurt by the negative side effects of foul odor or some pollution in the water. If a deontological