Reference no: EM131725099

Case Scenario: Ethics Drives Barrett-Jackson Auto Auction Company to Success

Monitoring the ethical behavior of auction companies can be tricky. Consumers might not know the value of the product until after they purchase it. and not all items purchased at auction companies cane with sufficient documentation to prove the product's authenticity. It has not been unheard of for sellers to falsify documentation to secure better deals. To avoid these ethical issues, classic and vintage car auction company Barrett-Jackson LLC has created an ethical culture that considers the needs of buyers, sellers, and the community. The company has been recognized as one of the world's most ethical companies by Whisper magazine. Barrett-Jackson was founded in 1971 in Scottsdale. Arizona. by classic car lovers Russ Jackson and Tom Barrett. The two men had met a decade earlier when Jackson was con-side ring buying a 1933 Cadillac V16 Town Car from Barrett. The two became lifelong friends and began organizing their own auctions. From the beginning the men recognized the special nature of the products they were auctioning. Buyers place great value on the cars they purchase. with some having searched for years to locate their classic "dream" car. The company would have to exert great delicacy to ensure a fair auction process and authentic products. After Rims Jackson passed away, his son Craig Jackson began running the company. Like his predecessors. Craig recognized the importance of adopting values to ensure an ethical auction process. "We will separate ourselves and do things in an ethical manna to make sure we set the right standards for our customers. These are the things that have been entrenched in our corporate curer since the beginning."

Craig stated. The company has instituted a number of programs to make certain that the auction process between buyer and seller remains fair. These programs recognize the inherent rights of the stakeholders involved in the transaction. For instance Barrett-Jackson protects buyers rights to choose by working to prevent false bids meant to raise the price of the cam. Sometimes car owners will try to bid on their own cars to boost the price. Barrett-Jackson acts to make certain that prices remain fair so that consumers can chance their dream car at a competitive price. Barrett-Jackson also protects the right to safety of both buyers and sellers by using security cameras to monitor stakeholders during the auction and mak-ing sure that buyers have the ability to pay. The company also offers access to Barrett-Jackson-endorsed insurance coverage, which reduces the risk of purchase by assuring buyers that their can can be restored in case of an accident Barrett-Jackson protects consumers' rights to be informed by making sure to the best of their ability that documentation is truthful and rejects sellers who do not meet their stringent requirements. Barrett-Jackson also tries to ensure that their stakeholders are provided with a forum to make their voices heard. This includes thoroughly investigating stakeholder concerns even if it might interfere with the sale of a product. For instance. one of the collector vehicles sold by Barrett-Jackson was allegedly the ambulance that carried President John F. Kennedy to the hospital after he was shot.

Shortly after the auction of the ambulance was announced, questions concerning the authenticity of these claims arose. Barrett-Jackson responded by undertaking a thorough investigation of the documentation provided on the ambulance. The company responded that it could not offer a 100 percent guarantee that the ambulance was authentic but that the claims were true to the best of its knowledge. By acting to investigate the available documentation and releasing a disclaimer. Barrett-Jackson not only took these claims seriously but told potential buyers about the possible risks involved so they could make an informed decision. Additionally. Barrett-Jackson practices social responsibility by giving back to the communities in which it does business. Barrett-Jackson has helped raise millions for charities nation-wide. The company also engages in strategic philanthropy and created the Barrett-Jackson Cancer Research Fund at the Translational Genomics Research Institute (Men) in 2010. In honor of Russ Jackson and his son Brian. both victims of cancer. the company raises money to fund research efforts to light colon and prostate cancer and scant for a cure. For example. in 2012 the company raised $125.000 for Wien by auctioning a 1993 Chevrolet Corvette 40th Anniversary coupe. Barrett-Jackson's emphasis on community relations and customer satisfaction has helped secure its reputation as an ethical tympany. Buyers and sellers alike can feel confident that they will be treated fairly when doing business with the firm. Barrett-Jackson is a good example of how ethical con-duct can increase company success."

Questions for Discussion

1. Why is ethical behavior so important for an auction company such as Barrett-Jackson?

2. In what ways does Barrett-Jackson protect the rights of its buyers and sellers?

3. How do solid community relations help Barrett-Jackson succeed?