Critical Incident In Business
Introduction
A critical incident is an event that occurs in an organization and affects how it functions and operates (Borchers, 2018). In most occurrences, these events negatively impact the organization, leading to adverse impacts that might paralyze the organization. Any management team needs to be careful and lay down strategies that prevent such incidences or reduce the impact they might have on the business when they occur, as some cannot be avoided. This presentation focuses on an incident that happened in a startup organization in which I was involved as one of the founders, and it paralyzes the business operations.
The Business
The business (startup) was a small manufacturing company that used to produce unique blends of natural fruit juice that would last long without expiring. The product was known as Trendy; it came in different flavours, sizes, and unique bottle sizes and designs. The formulation that was used in the production of the fruit juice was only known by three people who were the founders of the company. Trendy became popular in the market, and the rivals felt threatened, and they all wanted to take it down.
The incident
One of the big companies threatened by the product approached one of our managers and asked him to provide the formula that we used to them and offered an irresistible amount of money to him. The manager used all means possible and got his hands on the formula he sold to the other company, who commits industrial espionage (Glitz & Meyersson, 2017).
Impact of the incident
The industrial espionage incident adversely affected our business as the rival company started producing products that were similar to ours and took over a large section of our targeted market. The business profits were affected negatively to a point where some employees had to be let go due to the lack of enough money for salaries. Eventually, the business operations were paralyzed (Glitz & Meyersson, 2017). The company that bought the Trendy formula was a big company that influenced the market as compared to the startup we were running, and so they took our company out of business.
The company response
The company carried out its investigation to discover how the other company got its hands on the formula, and the industrial espionage was discovered. The manager and the rival company were taken to court on the charges of industrial espionage. The court conducted its investigations and looked at all the evidence provided. It judged the case in favour of our company as it was evident that the trendy formula originated from our company, and the manager confessed to his crimes.
Critique of the response
I believe the response of the company by seeking a legal solution was the best type of response to this incident. Justice is always served to the right party if adequate evidence is provided. It is always wise to seek justice through the proper channels instead of taking action and trying to sabotage the product or the rivals or get into a conflict with them.
Outcome
After following the right legal procedures and providing the correct evidence in court, the case was judged in favour of our company. The court asked the other company to pay $24 million to the company, and it was ordered to stop using the formula in any of its products. The company was ordered by the court to take all the products produced using the trendy formula out of the shelves. The manager was imprisoned for committing industrial espionage, which served as a lesson to other people who thought of doing the same.
Suggestions
It is vital for organizations always to secure their formulations and keep the ingredients they use to produce their products a secret. This can be done by having restricted access to such sensitive information and ensuring that all employees are vetted before being given jobs to prevent hiring spies (Solberg Søilen, 2016). Also, companies should ensure that all their employees are well taken care of to prevent them from being poached or turned by rivals.
References
Borchers, A. (2018). Journal of Critical Incidents.
Glitz, A., & Meyersson, E. G. (2017). Industrial espionage and productivity.
Solberg Søilen, K. (2016). Economic and industrial espionage at the start of the 21st century–Status quaestionis. Journal of Intelligence Studies in Business, 6(3), 51-64.