Sample Essay on The Rana Plaza Disaster: Implications for Sustainable Supply Chain Management

The Rana Plaza Disaster: Implications for Sustainable Supply Chain Management

Introduction

            The Rana Plaza disaster is one of the worst tragedies in the history of garment industries in the world today. This disaster occurred in Bangladesh claiming the lives of approximately 1,100 workers and leaving more than 2,500 others injured (ABC NEWS, 2014). It is believed that the main cause of this tragedy was the addition of more floors to the already existing substandard building that housed several industries and offices. The investigation from the tragedy reveals that the building had only been built to accommodate shops, apartments, and offices, but not factories. The first four floors of the plaza, which from the outside appeared to be strong housed several shops, bank and apartments. The upper floors, which were illegally added, housed garment factories that had heavy machinery.

            Rana Plaza, an eight-storey building that was meant for commercial purposes was located in Savar. Savar is one of the sub-districts in the Bangladeshi capital. It was situated in the Greater Dhaka area and was owned by Sahel Rana, renowned politician (Jacob, 2012). Rana Plaza housed several garment industries that employed approximately 5000 people. Several warnings had been given prior to the disaster including an expose on a national television network in Bangladesh. During the tragedy, the occupants of the first four floors had vacated the building leaving the garment industries operational due to an order from the factory owner not to close business.   

Disaster and Its Physical Causes

            The Rana Plaza tragedy occurred on Wednesday, 24 April 2013 at about 8:57 a.m. when nearly all the garment factory workers were in the building (Jacob, 2012). On the fateful day, the garment factories experienced a power cut forcing the management to start the diesel generators, which were stationed at the top floor. Minutes later, the vibrations became unbearable for the building causing it to collapse leaving the ground floor without any damages. It was confirmed that 3,122 workers had reported to work that morning and were in the building during the collapse.

            From the investigation reports by the Bangladesh Fire Service and Civil Defense head, Ali Khan, the top four floors were illegally built since they did not have a permit. Masood Reza, who was the architect of the building made a confirmation that the building was meant to house offices and shops only, but not any kind of industries that required heavy machinery. The building was not strong enough to house the factories since it had not been designed for heavy vibrations or carry much weight. A day before the collapse, a local television channel had shown an expose that showed cracks in the building leading to the evacuation from the building (Olaru, 2009). The bank, apartments and shops that were on the lower floors were closed with immediate effect leaving the garment factories only. Sohel Rana, the owner of the building, however, treated the information offered by the media casually claiming that the building was safe and that all the garment factory workers should report to work without fail on the following day. In addition, some of the managers threatened the workers in these industries that they would not release their pay for the month if they refused to report to work the following day.

Physical Causes of the Rana Plaza Disaster

First, according to the permit, the building was to remain with its four floors. However, the owner of the building, Sohel Rana overlooked these conditions and added three extra floors to the already existing weak building. Secondly, Rana Plaza had been originally designed for commercial use only and not for industrial use. However, in the end, several garment industries were started on the top floors making it weaker. The building was designed to house apartments, shops, and a bank only. Introducing garment factories eventually weakened the building due to the heavy machinery used by the industries. From the investigation reports, it is evident that the building was constructed using substandard material. This led to a strain on the building structure, which was made worse by the vibrations of the machinery and the generators that were used on the morning of the collapse. Such practices indicated the unlawful acts by Sohel Rana as well as failure in the administrative team that he had employed (Gifford and Ansett, 2014). Fourthly, the Rana Plaza had been built on a pond without any authorization from the building and construction department in the country. Corruption in Bangladesh led to unlawful acts in the construction industry, thereby leading to loss of many lives (Stewart, 2014).

The Underlying Failures of the Organization

            The garment industries housed in Rana Plaza and owned by Sahel Rana had huge underlying failures that eventually ended up in a tragedy (Jacob, 2012). First, Rana Plaza was obviously overcrowded, having to house thousands of workers whom a majority were involved in the production of garments for the international brands. Overcrowding was a failure to the organization since it was not impossible to find another building to spread the workers over to prevent an overload on the building. It is unfortunate that the organization did not have a limit to the number of workers that could be housed in the building all at once. Evidently, this is a failure in the safety systems that had not even been put in place for the industries.

            In addition, the organization fell victim of the use of low cost laborers with less restrictive labor laws. As a result, this industry remained an attractive outsourcing area for the western countries. The western shoppers went on to enjoy very affordable prices for their products as well as the latest fashions in the industry at the expense of the safety of workers in the organization (Olaru, 2009). The workers in Bangladesh have been subjected to underpayment to maintain low cost in manufacturing of items in the organizations.

            The garment industries in Rana Plaza failed due to engagement in corruption during the construction of the three extra floors that housed the factories. From the investigation, it is evident that Sohel involved himself in corrupt deals and the use of political power to attain an illegal permit to erect the illegal upper floors. It is unfortunate that this action did not in any way raise any considerable concern to the management of the organization. The management focused more on profitability and less on the safety of workers (Olaru, 2009). As much as there was a highlight of a looming tragedy in one of the television channels, little or no concern was given in relation to the safety of workers in the organization. The demand for organization profitability superseded the right for good working conditions in the industries. The forceful demand by the management for workers to resume after the realization of the cracks was a huge concern and unethical altogether.

Relevance, Benefits, and Limitations of Different Ways Western Retailers Can Influence Upstream Members of Their Supply Chains

Benefits

            Western retailers often have a huge influence on the upstream members of the supply chain. Their positive influence has been felt in the Bangladesh garment industry since its conception (Olaru, 2009). To begin with, Western retailers are the biggest beneficiaries of the outsourcing plan in the garment industry. One of the main benefits to the industry is that they offer ready market for products. Since Western shoppers are careful about fashion, the garment industry down their supply chain, in this case the Bangladesh industries offer new fashion in the clothing industry on a regular basis. With this step, none of the industries lacks market for its products hence giving a boost to the economy of the country upstream.

Limitations

            The main reason as to why Western countries get their apparel from countries such as Bangladesh is due to the fact that they are able to manipulate the costs of the products. Such manipulation and influence push the garment industry to their limits forcing them to make use of cheap labor; leading to the underpayment of workers in the countries upstream. In addition, due to the pressure of high amounts of production from Western countries, countries such as Bangladesh force their workers to work hard without prior consideration of their safety (Mendes, 2014). The main aim of the organizational managers is to maintain profitability and consistent flow of goods into the Western countries. This places the workers at a risk of encountering tragedies.

            Overworking is also a major occurrence in the upstream countries in the supply chain. For instance, the workers in Bangladesh at the Rana Plaza were subjected to at least 12 hours of nonstop work per day every single weekday.  In every hour, workers were given a huge target to meet, which was placed under strict supervision just to ensure that none of the westerners lacked the product fashion they desired. Placing much emphasis on the retailer rather than balancing the retailer and the industry worker is a limitation within the supply chain system. The Westerners comfort is more highly esteemed than the comfort of the industry workers. The Western retailers are relevant to this case since they are the main retailers for the garments from Bangladesh. In addition, they are at the top position of the supply chain and have an immense level of influence on the garment industry production decisions (Koontz, 2010).

How a Company Can Be More Sustainable Than Its Supply Chain

            It is important for a company to be more sustainable than its supply chain to maintain its profitability levels. There are various ways in which is made possible. First, a company can come up with business decisions that ensure the environment is fully protected. Such decisions are such as taking part in the Green Movement, which ensures that the environment is sustained through the avoidance of pollution especially from industries within a country (Sanders & Wood, 2014). The Green Movement ensures that the environment around a company, organization or industry remains bearable for the people living around. In addition, such steps ensure that there is a consistent production of raw materials for a company hence guaranteeing its continuity throughout the years.

            A company can also be more sustainable than its supply chain by undertaking business sustainability strategies, which make sound economic sense. Adopting such sustainability strategies ensure there is a reduction on the energy costs within a company and the brand reputation is enhanced. The adoption of sustainability strategies also ensures that companies increase staff and customer loyalty as well as external and internal relationships (Sanders & Wood, 2014).

How a Company Can Fail To Be More Sustainable Than Its Supply Chain

            There are several ways in which a company may cease to be sustainable than its supply chain. First, a company may involve itself in the production of environmentally destructive products that expose the environment to dangerous substance. Thus, there is a rise in poor availability of raw materials; hence a huge reduction in the production of goods and services. A company can also be no more sustainable than its supply chain by failing to cultivate its relationship with its workers and customers (Koontz, 2010). Presently, there are many ways in which companies maintain close relationships with its customers and workers. Such ways include the use of social media to ease interaction between customers, organizational workers, and customers.

Why a Company Should Be Concerned With the Sustainability of Its Supply Chain

            Every company must be concerned with the sustainability of its supply chain. First, it is important to note that a sustainable supply chain is no longer an option for business today, but a necessity. It is critical and determines the success of an organization or business in the world of competition. The sustainability of a supply chain is important in the reduction of operational risks in an organization (Centinkaya et al. 2011). Operational risks are such as system failure within an organization or the challenges that arise with the legality of the business.

            The sustainability of a supply chain should be a huge concern for an organization since it ensures that the integrity of company brands is promoted and maintained. A company that faces the risk a soiled brand reputation is likely to encounter the loss of customers, which eventually leads to huge losses (Caroll, A. & Buchooltz, 2014).The sustainability of a supply chain ensures that there is an increase in the opportunities for a company and its employers. In addition, such a supply chain offers diverse opportunities for innovation and cost savings for a company.

Limitations to the Understanding of the Facts of the Case

The Rana case has various limitations that make it difficult for one to fully understand what truly transpired before and after the tragedy. Such limitations also place a barrier to the understanding of the main causes of the accident apart from carelessness and corruption. From the research, it is evident that all building and construction laws had not been clearly put into serious consideration. The soil on which the building was erected was poor; the land had been rejected before since it was a swampy area. It is clear that there were engineers who had been involved in the construction process. For instance, Masood Reza, an architect is known to have verified that the building was only meant for shops, offices, and not factories. It is therefore difficult to understand why, firstly, the engineer on site oversaw the construction of a complex building on a pond. It is hard to know why they allowed use of substandard materials since they were already working on unstable grounds. Furthermore, it is not clear whether the architect was consulted before the addition of the three floors as well as the main person who was behind the authorization of floor additions. There is evidence that the building was declared unsafe by engineer Abdur Razak Khan who further advised the government to do its investigation. Later an officer from Upazila went to meet Sohel before declaring the building safe. It is challenging to understand if there was any connection to this declaration and if the top officials were involved. Lastly, there is limited understanding on why Sohel Rana was involved in convincing the managers of the apparel industry to use a weak building (Gifford & Ansett, 2014).

Limits of Conceptual Analysis of the Case

As late as the year when the building collapsed, most countries in the world had enacted laws on construction of buildings and enforced them. Most governments had also formed laws on safety and the rights of workers and even created ministries of labour to deal with issues of workers. Many countries worldwide have workers trade unions and the workers are quite informed on their rights. Entrenched corruption in the system makes it difficult to understand why people believe in corruption and substandard lifestyle other than standards and quality life. The government did not put in place measures to ensure business establishments met the acceptable standards and met the human rights expectations. The Rana Plaza tragedy reveals the inability of the government to make prudent and precise decisions meant to safeguard its people from individual exploitations (Mendes, 2014). There were a number of reports of lack of industrial safety before and after the Rana Plaza tragedy. The process of industrial change towards acceptable standards lacks support from the very government responsible for this work. There is either no political will supporting change because the politicians are involved in dubious business activities.

Limits of the Capability of the Collective Process

There are various limitations to the capability of the collective process. Evidently, workers had no trade unions that would protect their interest as garment industry employees. This is evident in the Rana plaza tragedy; no one championed the fears of the workers concerning their safety. The management stood strong against the many workers wishes on their safety. The management was not bold to stand up against the convictions of their landlord that it was safe to occupy the building. There was enough evidence, the cracks were all visible and dangerous but police failed to enforce the law to force people out of the premises awaiting logical conclusion on safety of the building (Carroll & Buchooltz, 2014). The companies on the other hand did not mind to assess the situation and lacked the ability to make sound judgment on the safety of the operation ground. There is astounding revelation that some officials in the authorities found it better to take bribes and allow illegal activities to go on. They did not understand the consequences of corruption. It is difficult understand why Mr. Rana would opt to build a complex worth a lot of money in a pond while ignoring construction procedures. Additionally he would rather spend in corruption than to use the money to build quality structure. It is astounding Sohel did not show interest talking to the banks and other shop owners when they closed down business, however, when the garment industries wanted to close business Rana convinced them to continue operating thereby forcing workers into the building. It is also fascinating that Rana consistently ignored all alarms of danger from the start of construction of the complex building to collapsing point. Most officials in authority protected the interests of the few to gain dishonestly.

Limitations of the Capacity of Retrospective Case Study

The study was done after the incident occurred. Data collected was from amongst other sources and materials that would have been written for purposes other than research. There are possibilities that information may miss the accuracy needed and that several changes would have been made to the information (Gifford & Ansett, 2014). Some persons with valuable information may miss therefore affecting the research.

References

ABC NEWS (2014). Rana Plaza factory collapse: Australian clothing retailers yet to sign Bangladesh safety accord. 24 April 2014. Retrieved from www.abc.net.au/news/2014-04-24/australian-clothing-retailers-yet-to-sign-factory-safety-accord/5408028

Caroll, A. & Buchooltz, A. (2014). Business and Society: Ethics, Sustainability, and Stakeholder Management. NY: Cengage Learning.

Centinkaya et al. (2011). Sustainable Supply Chain Management: Practical Ideas for Moving Towards Best Practice. NY: Springer Science & Business Media.

Gifford J. & Ansett, S. (2014). 10 things that have changed since the Bangladesh factory collapse. 2 April 2014. Retrieved from http://www.theguardian.com/sustainable-business/bangladesh-factory-collapse-10-things-changed

http://www.ft.com/cms/s/0/b49c0616-3e3e-11e2-91cb-00144feabdc0.html#axzz2nT4zoYSc

Jacob, R. (2012). Buyers pay lip service to factory welfare. Financial Times.

Koontz, H. (2010). Essentials of Management 8E. NY: McGraw-Hill Education.

Mendes, E. (2014).  Global Governance, Human Rights and International Law: Combating the Tragic Flaw. Massachusetts: Routledge. 

Olaru, S. (2009). Ethics and Integrity In Multinational Companies. Review of International Comparative Management, Volume 10, Issue 1: pp 113-120.

Sanders, N. & Wood, J. (2014). Foundations of Sustainable Business: Theory, Function, and Strategy. NY: John Wiley & Sons.

Stewart, K. (2014). An ethical analysis of the high cost of low- priced clothing. Journal of Academic and Business Ethics.