In the contemporary world, many companies face a plethora of legal and ethical issues that affect every aspect of their operation tremendously. One of the firms that have had to deal with a myriad of moral as well as legal matters is the electronics giant, Philips Electronics Company. An organization can only be successful if it takes care of the ethics as well as the legal issues that face it in the best manner possible. Doing so ensures that the firm runs smoothly and is devoid of any jitters that arise due to law suits and other related matters. Economists have also played a critical role in the success of business organizations. An accomplished economist of yore, Milton Friedman has advanced theories that have affected businesses in the past few decades. Some of the laws that apply to Philips Electronics company and their legal and ethical frameworks as well as how it has been affected by the theories that were advanced by Milton Friedman are analyzed in detail in this paper.
A company needs to have the right people at the helm to ensure that the right decisions are made that will eventually catapult the organization to unfathomable levels of success. For that reason, it is of utmost prudence that all managers take their roles seriously in the day today operation of the business. Upholding ethics and abiding by all the laws that have been set by the relevant authorities is a recipe for success to any organization (Deckmyn, 2017) .
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Products Manufactured by Philips
For starters, Philips Electronics Company has been at the forefront in the provision of quality and durable goods to all their customers. Indeed, their contribution to the electronics products market cannot be overlooked under any circumstance. The company was founded in The Netherlands and manufactures and distributes lighting products as well as undertakes their marketing. Some of the equipment that they make are audio visual equipment, professional goods, and domestic goods. Additionally, the firm has also household products, lighting products, and business electronics. Products such as semiconductors and their components, consumer communication and medical systems are also among the products that are provided by the company.
History of the Company
Philips Electronics Company was founded by Frederik Philips and his son Gerard in 1981 (Oster, 2017) . His son was an engineer and had worked with an Anglo-American conglomerate. He conducted a series of experiments to improve the light bulbs that were manufactured by the company. Their main aim was to improve the quality of their products rather than to entice their customers with low costs. Later on, the company’s commercial background has been enhanced when another of Philip’s sons joined the enterprise. He was the one who aided in the international expansion of the company due to his immense abilities. However, the company slowed down in the process in which it brought improved technologies to the market.
The company is among the few that have taken the bold step to take care of its employees from the cradle to the grave. They have come up with some policies that are aimed at ensuring that majority of their employees receive the best care while they are working for the company. They have managed to provide medical and housing assistance to their staff over the past decades in a seamless manner. They have managed to do so by building schools and hospitals that cater to the needs of their employees. The company managed to get rid of cartels in light bulb manufacturing by providing alternative lighting solutions that were cheaper. Philips had managed to expand into the manufacture of radio tubes by 1919 (Bloomberg, 2017) . They were the worlds largest manufacturers of radio cells by 1933 (Whitehouse, 2017) .
The company moved swiftly to expand into international markets that were located outside Netherlands so that they could escape the import controls that had been implemented by many countries during the Great Depression. The firm moved its headquarters to Curacao at the height of World War II. Their main aim for making this decision was to keep the company out of German control. They were able to expand their product's range after 1945by launching Philip’s Record Label in 1951, acquiring Mercury Records in 1960 and engaging in many other acquisitions (García-de-Madariaga, 2015) . Despite its significant contribution to the electronics market, the firm had an uneventful takeoff if the computer business during the ‘60s (Philips, 2017) . They launched their h ardware manufacturing unit when other companies such as IBM were already entrenched in the sector. However, they remained to be a major supplier of the components that were used in the manufacture of computer hardware.
Ethical Issues Surrounding Philips Electronics Company
In the 21 st Century, businesses are surrounded by many ethical issues. The electronics giant has not been spared when it comes to ethical issues that every organization has to adhere to. Every agency is mandated to formulate a given code of ethics that every employee of the firm needs to abide by accordingly. Some of the fundamental issues that are at the core of every organization are trust and integrity. Moreover, there exist more complex issues that also play a vital role in the success of a team. They include governance, compliance, decision making, and most importantly accommodating diversity.
Fundamental Issues Affecting Organizations
As a team, Philips has faced key fundamental issues about integrity and trust. A company that has a good understanding of integrity will always conduct its operation by the needs of their clients and uphold integrity at all times. They understand that it is important to treat all customers fairly and stay committed to their principles. In many circumstances, a high level of trust comes about between the company and their clients when their clients realize that the firm has stayed committed to its purpose of serving them. Indeed, a key determinant of a company’s success lies in the type of relationship that firm has established with its customers.
Compliance and Governance Laws
All businesses need to comply with all matters of governance in the course of their operations. They are required to adhere to the federal and state safety regulations, applicable civil rights laws, fiscal and monetary reporting status and security regulations. It is widely accepted that no one has the mandate to ask an employee to go against the values of the firm, break a particular law or violate any procedure or policy under any circumstance. They should always aim to comply with all the policies and regulations that have been set by the relevant authorities.
Decision-Making Issues
Organisations need to explore the framework of ethical decision making since it is essential in the process of exploring ethical dilemmas and identifying an ethical course of action. The process of ethical decision making starts with the recognition of the moral issue that is at hand. The second step entails getting the facts and evaluating alternative actions. After that has been done, there is the evolution of alternative actions and then making a decision. The last step in the process of ethical decision making is testing and reflecting on the decisions and then reflecting on its outcome. When companies are in the process of moral decision making, they should always consider the critical issue, that of protecting the rights of customers. Furthermore, they should also ensure that all their undertakings are acceptable by their client.
Laws that Apply to the Philips Electronics Company
Rules about Offer, Confirmation or Agreement
These are some of the terms and conditions that apply to the sale of commercial sale of Philips Consumer Lifestyle. It forms an important part of all the quotations as well as the offers that are made by Philips Consumer Lifestyle. The laws that pertain to this segment stipulate that all the confidentiality, acknowledgment and acceptance should be made in writing. The company shall reject all the documents together with the terms and conditions that are issued by the buyer before any formal undertakings. Such like terms shall not apply to any sale that is made by Philips and will not be legally binding.
Laws regarding Pricing of the Company’s Products
The United States subsidiary of the company has come up with strict measures relating to the pricing of the products that are manufactured by the enterprise. It states that all prices in any agreement or confirmation are supposed to be in US dollars. The denominations may be subject to change if the firm and the client reach a deal. The pricing does not include factors such as duties, taxes or similar levies. The company will add levies and other taxes as recommended by the law. Additional taxes and levies are subject to payment by the buyer together with the price of the products.
Delivery and Quantities
The company has laws that relate to the delivery of their goods when the clients have ordered them. The products are delivered Ex-Works as have been designated by the company unless otherwise it is agreed in writing with the customer. Additionally, the company affirms that the delivery dates that have been given are only approximate and may be subject to change. The firms shall not accept liability if goods are delivered before or after the date that had been specified by the business. Philips Electronics Company is in agreement to ensure that it meets the deadlines for the supposed delivery of the ordered products. However, it can only ensure so if the buyer provides all the relevant information sufficiently before the scheduled delivery of the goods. The customer is supposed to give the company a time frame of thirty days within which the order should cure. The client can go ahead and cancel the order if the Philips does not deliver the goods within the thirty days.
Influence of Milton Friedman’s Philosophy to the Company’s Executives
One of the economists who managed to reshape the science of economics was Milton Friedman. He was among the pioneers in the field of economics who ensured that they gave their opinion regarding economics. He advocated for the policy of free markets as opposed to government intervention. Many economists regarded his ideas over inflation fighting by the Central Banks to be trivial. His views helped to reshape the modern perception of capitalism in a great way. The executives of Philips have been influenced excellently by the ideas of Milton Friedman. They utilized his ideas of free and open markets and took the golden opportunity to venture out into new markets. Therefore, the executives ensured that the firm expanded its boundaries to external markets and had an extensive market share. Furthermore, it gave them an advantage over their main competitors in the market such as LG, Samsung, and Sony in the electronics segment. The executives of the company may have also been influenced by other ethical frameworks such as environmental protection and consumer protection.
From the preceding, it can be concluded that all businesses need to comply with the ethical and legal issues to survive the test of time. Indeed, companies such as Philips have strived to adhere to the set legal as well as moral codes so that they can provide quality goods to their clients. It is an open secret that success will be elusive and remain to be a pipedream to organizations that allow ethics and legal issues to take a back seat in the course of their operations.
References
Bloomberg. (2017). Company Overview of Philips Electronics. Bloomberg , 79-85.
Bloomberg. (2017). Philips Electronics North America Corporation Key Developments. Bloomberg , 56-67.
Deckmyn, D. (2017). Philips Electronics NV. Encyclopedia Britannica , 75-79.
García-de-Madariaga, J. (2015). Corporate social Duty and the classical theory of the firm: Are both theories irreconcilable? Revista Innovar Journal , 117-126.
Oster, K. (2017). List of Ethical Issues in Business. Hearst Newspapers , 32-38.
Philips, K. (2017). Terms and conditions of commercial sale of Philips Consumer Lifestyle, a division of Philips Electronics North America Corporation. Koninklijke Philips , 54-63.
Whitehouse, G. I. (2017). How Milton Friedman RevolutionizedEconomics, Policy and Markets. The Wall Street Journal , 109-117.
