Case Study 1

To publicize its newly opened nightspot, a major hotel instituted weekly tea dances in the lobby of the hotel. A local band played 1940s-era music while dancers competed in friendly contests. On a Friday night in July, the band was playing Duke Ellingtons Satin Doll when two skywalks spanning the lobby of the year-old hotel collapsed. Sixty-five tons of concrete, metal, glass, and dance spectators plunged four floors to the sidewalk below, killing 114 persons and injuring 216 others.

The investigation after the collapse revealed that the collapse resulted from poor judgment and a series of events that, in combination, produced a disastrous result. The study showed a history of oversights, misunderstandings, and safety problems plaguing the 40-story, 780-room luxury hotel during construction and for months after its opening.

Mishaps arent uncommon on big projects, of course. But this huge project, which was built on an accelerated schedule, encountered a series of accidents and near-accidents during construction. At one point the buildings owner dismissed its general contractor and barred an inspection company from bidding on future company projects.

The hotel was erected using the fast-track method, a fairly common procedure in which construction proceeds before all drawings are complete. With a $40 million construction loan outstanding and all building costs soaring, the owner wanted the hotel up and open as quickly as practical.

Design changes are common on fast-track projects, making clear communications more critical than usual. The owners of the building had circulated a 27-page procedures manual explaining the proper channels for design changes and approved drawings. But the procedures werent always followed, and other mistakes slipped in. Because some connections were misplaced on the drawings, for instance, workers installed a sweeping cantilevered stairway without fully attaching it to a wall.

The investigation found that the skywalks fell as a result of a design change made during a telephone call between the structural engineering company and the steel fabricator. Stress calculations would have shown that the redesigned skywalks were barely able to support their own weight, let alone the weight of dozens of dance spectators. However, court depositions of the two engineers who made the telephone redesign indicate that each person assumed it was the others responsibility to make new calculations, and neither did.

Edward Pfrang, then chief of the structures division of the National Bureau of Standards and a participant in the investigation, says, One thing thats clear after . . . [this] failure and a few others is that there isnt a clear-cut set of standards and practices defining who is responsible in the construction process.

1. Who was responsible for the collapse? Explain.
2. Identify several key time points at which the problem could have been corrected.
3. Is this a failure of planning, organizing, leading, or controlling?

Case Study 2

In the 1950s, more than 150 television manufacturers called the U.S. home. Today, not even component parts for TVs are produced on American soil. Still, that hasnt stopped Wal-Mart from slapping Assembled in the USA stickers onto many flat screen TVs stocked in its stores. Thats because the company buys the televisions from South Carolinas Element Electronics Corporation, which imports all their items from China.

That doesnt mean Element is simply a middleman operation though. TVs that arrive at the companys Winnsboro plant are first placed on a conveyor belt to check for scratches and other defects. Further down the line, workers install motherboards and perform several mechanical tests. When Elements work is done, the TVs are repackaged, stamped, and sent off to Wal-Mart stores. The mega-retailers relationships with companies like Element lie at the heart of its commitment to produce $250 billion worth of goods domestically over the next decade. But as the South Carolina manufacturer shows, revitalizing an entire industry cant be done overnight. After all, even the motherboards installed by Element employees are originally made in China.

Thats because the U.S. lacks a blue-collar workforce who can perform complicated electrical work, something that China has in abundance. However, companies like Element and Wal-Mart hope to reverse this trend by gradually reintroducing elements of production back to America. For instance, Element expects to receive even more assembly work once the company has established itself better with Chinese suppliers. In fact, within two years Elements factory will have the equipment to install glass panels onto flat screen TVs. These parts account for 65 percent of the televisions cost, so Element will need to prove that it can backlight TVs effectively before earning the trust of outside manufacturers. Meanwhile, Wal-Mart is working to bring more assembly and production tasks to American factories with extra capacity. For manufacturers, the retailers commitment to buy what they produce is incentive enough to invest in larger capabilities, such as Elements backlighting expansion.

1. Is labeling Assembled in the USA ethical if products are mainly produced elsewhere?
2. Can the U.S. increase the number of qualified production workers?