Case Study: Alcoa’s Core Values in Practice
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The Aluminum Company of America (Alcoa) began its company in 1888 under the name of the Pittsburg Reduction Company. In 1907, they changed their name to Alcoa and from its inception they had a very strong value based culture. In the very beginning of their work all employers learned everything they made and did had to be aligned with the company’s values. “In 1985 Fred Fetterolf then President decided the company needed to document the values that all employees must live by: Integrity; Environment; Health and Safety; Customer; Accountability; Excellence; People; and Profitability” (Lawrence & Weber, 2011; pg.119). In the 1990’s Alcoa’s CEO Paul O’Neill, communicated his unswerving belief in the importance of health and safety, which was one of the company’s core values (Lawrence & Weber, pg. 119). Alcoa had an understanding in their code of practice that made sure safety was a primary concern and focus. The overall work climate would be classified as benevolence and principle. Alcoa also had core standards for all workers and their management believed that “no employee should be forced to work in an environment where their safety or the safety of other employee’s might be jeopardized” (Lawrence & Weber, pg. 120). The emphasis of safety had a deep and important meaning to Alcoa’s management team as they cared deeply about their employees.
Most individuals already have beliefs or perceptions about what type of environment they will work in as well as what type of relationship they may form with their company or employer. “An organizations ethical work climate is an important factor to determine as it affects the nature of the relational contract between the individual and their employer (Barnett & Schubert, 2002; pg. 279). Alcoa had very strong core values for all its employees and each employee knew precisely that all decisions being made would have to meet Alcoa’s Core Standards. This shows values of benevolence and principles, because Alcoa had a huge concern for their workers. The employees also had a strong professional relationship with Alcoa because they acted with integrity and followed rules and procedures according to Alcoa’s standards. That is why Alcoa’s top management team treats all employees with integrity, honesty and fairness. They also play a huge role in developing the ethical work climate and organizational performance seen at Alcoa. Overall the company emphasized that the programs role and continuous ethics, must be continually reinforced by management (Lawrence & Weber, 2011; pg.120). “Mr. O’ Neill took the interest of the company’s values and safety into hand and required continuous improvement as everyone strove toward an ideal goal of perfection” (Lawrence & Weber, 2011; pg.120).
As in life, it is perfectly fine to want to strive to become better to have overall quality and satisfaction out of life and in your business. Alcoa has a made a commitment to improving the quality of life among its employees and community as well. Overall, Alcoa’s ethical work climate is diverse and encourages open communication between workers, has ethical high principles and a very good work environment. Alcoa’s core values are held to a high standard and by setting these standards Alcoa has made a commitment to improve the moral of their company, their employees, and their consumers.
Barnett & Schubert (2002) Perceptions of Ethical Work Climate & Covenantal Relationships. Journal of Business & Ethics. Volume 36. Number 3, page 279.
Lawrence, A. T. & Weber, J. (2011). Business and society: Stakeholders, ethics, public policy (13th ed.). New York: McGraw-Hill/Irwin. ISBN: 978-0-07-813715-0