Script processing ethics

Pinto Fires and Personal Ethics: A Script Analysis of Missed Opportunities Dennis A. Cioia

ABSTRACT. This article details the personal involvement of the author in the early stages of the infamous Pinto fire case. The paper first presents an insider account of the context and decision environment within which he failed to initiate an early recall of defective vehicles. A cognitive script analysis of the personal experience is then offered as an explanation of factors that led to a decision that now is commonly seen as a definitive study in unethical corporate behavior. IThe main analytical thesis is that script schemas that were guiding cognition and action at the time pre.- cluded consideration of issues in ethical terms because the scripts did not include ethical dimensions.

In the summer of 1972 I made one of those impor- tant tran.sitions in life, the significance of vifhich becomes obvious only in retrospect. I left academe with a BS in Engineering Science and an MBA to enter the world of big business. I joined Ford Motor Company at World Headquarters in Dearborn Michigan, fulfilling a long-standing dream to work in the heart of the auto industry. I felt confident that I was in the right place at the right time to make a

Dennis A. Gioia is Associate Professor of Organizational Behavior

in the Department of Management and Organization, The

Smeal College ofBusiness Administration, Pennsylvania State

University. Professor Cioia's primary research and writing focus

of the nature and uses of complex cognitive processes by organiza-

tion members and the ways that these processes affect sensemak-

ing, communication, influence and organizational change. His

most recent research interests have to do with the less rational,

more intuitive, emotional, and political aspects of organizational

life — those fascinating arenas where people in organizations tend

to subvert management scholars' heartfelt attempts to have them

behave more rationally. Prior to this ivory tower career, he worked

in the real world as an engineering aide for Boeing Aerospace at

Kennedy Space Center and as vehicle recall coordinator for Ford

Motor Company in Dearbom, Michigan.

difference. My initial job title was "Problem Analyst" — a catchall label that superficially described what I would be thinking about and doing in the coming years. On some deeper level, however, the ride paradoxically came to connote the many crirical things that I would not be thinking about and acring upon.

By that summer of 1972 I was very full of myself. I had met my hfe's goals to that point with some notable success. I had virtually everything I wanted, including a strongly-held value system that had led me to question many of the perspectives and prac- rices I observed in the world around me. Not the least of these was a profound distaste for the Vietnam war, a distaste that had found me parrici- paring in various demonstrarions against its conduct and speaking as a part of a collecrive voice on the moral and ethical failure of a democraric govern- ment that would attempt to jusdfy it. I also found myself in MBA classes railing against the conducr of businesses of the era, whose acrions struck me as ranging from inconsiderate to indifferent to simply unethical. To me the typical stance of business seemed to be one of disdain for, rather than respon- sibility toward, the society of which they were prominent members. I wanted something to change. Accordingly, I culrivated my social awareness; I held my principles high; I espoused my intenrion to help a troubled world; and I wore my hair long. By any measure I was a prototypical "Child of the '60s."

Therefore, it struck quire a few of my friends in the MBA program as rather strange that I was in the program at all. ("If you are so disappointed in business, why study business?"). Subsequently, they were practically dumbstruck when I accepted the job offer from Ford, apparendy one of the great pur- veyors of the very acrions I reviled. I countered that it was an ideal strategy, arguing that I would have a

Journal ofBusiness Ethia 11: 379-389, 1992. © 1992 Kluwer Academic Publishers. Printed in the Netherlands.

380 Dennis A. Gioia

greater chance of influencing social change in busi- ness if I worked behind the scenes on the inside, rather than as a strident voice on the outside. It was clear to me that somebody needed to prod these staid companies into socially responsible acrion. I certainly aimed to do my part. Besides, I liked cars.

Into the fray: setting the personal stage

Predictably enough, I found myself on the fast track at Ford, parriciparing in a "tournament" type of socializarion (Van Maanen, 1978), engaged in a competirion for recognirion with other MBA's who had recently joined the company. And I quickly became caught up in the game. The company itself was dynamic; the environment of business, especially the auto industry, was intriguing; the job was challenging and the pay was great. The psychic rewards of working and succeeding in a major corporarion proved unexpectedly seducrive. I really became involved in the job.

Market forces (internarional comperirion) and government regularion (vehicle safety and emissions) were affecring the auto industry in disruprive ways that only later would be common to the wider business and social arena. They also produced an industry and a company that felt buffeted, belea- guered, and threatened by the changes. The threats were mostly external, of course, and led to a strong feeling of we-vs-them, where we (Ford members) needed to defend ourselves against them (all the outside parries and voices demanding that we change our ways). Even at this rime, an intriguing quesrion for me was whether I was a "we" or a "them." It was becoming apparent to me that my perspecrive was changing. I had long since cut my hair.

By the summer of 1973 I was pitched into the thick of the battle. I became Ford's Field Recall Coordinator — not a posirion that was parricularly high in the hierarchy, but one that wielded influence for beyond its level. I was in charge of the opera- rional coordinarion of all of the recall campaigns currently underway and also in charge of tracking incoming informarion to idenrify developing prob- lems. Therefore, I was in a posirion to make inirial recommendarions about possible future recalls. The most crirical type of recalls were labeled "safety campaigns" — those that dealt vwth the possibility of

customer injury or death. These ranged from straight-forward occurrences such as brake failure and wheels falling off vehicles, to more exoric and faintly humorous failure modes such as detaching axles that announced their presence by spinning forward and slamming into the starded driver's door and speed control units that locked on, and refused to disengage, as the care accelerated wildly while the spooked driver furilely tried to shut it off. Safety recall campaigns, however, also encompassed the more sobering possibility of on-board gasoline fires and explosions....

The Pinto case: setting the corporate stage

In 1970 Ford introduced the Pinto, a small car that was intended to compete with the then current challenge from European cars and the ominous presence on the horizon of Japanese manufacturers. The Pinto was brought from inceprion to produc- rion in the record rime of approximately 25 months (compared to the industry average of 43 months), a rime frame that suggested the necessity for doing things expediently. In addirion to the time pressure, the engineering and development teams were re- quired to adhere to the producrion "limits of 2 000" for the diminurive car: it was not to exceed either $2 000 in cost or 2000 pounds in weight. Any decisions that threatened these targets or the riming of the car's introducrion were discouraged. Under normal condirions design, styling, product plarming, engineering, etc., were completed prior to produc- rion tooling. Because of the foreshortened rime frame, however, some of these usually sequenrial processes were executed in parallel.

As a consequence, tooling was already well under way (thus "freezing" the basic design) when rourine crash tesring revealed that the Pinto's fuel tank often ruptured when struck from the rear at a relarively low speed (31 mph in crash tests). Reports (revealed much later) showed that the fuel tank failures were the result of some rather marginal design features. The tank was posirioned between the rear bumper and the rear axle ( a standard industry pracrice for the rime). During impact, however, several studs protruding from the rear of the axle housing would puncture holes in the tank; the fuel filler neck also was likely to rip away. Spilled gasoline then could be

Pinto Fires and Personal Ethics 381

ignited by sparks. Ford had in fact crash-tested 11 vehicles; 8 of these cars suffered potenrially cata- strophic gas tank ruptures. The only 3 cars that survived intact had each been modified in some way to protect the tank.

These crash tests, however, were conducted under the guidelines of Federal Motor Vehicle Safety Standard 301 which had been proposed in 1968 and strenuously opposed by the auto industry. FMVSS 301 was not actually adopted until 1976; thus, at the rime of tlie tests. Ford was not in violarion of the law. There were several possibiliries for fixing the problem, including the oprion of redesigning the tank and its locarion, which would have produced tank integrity in a high-speed crash. That solurion, however, was not only rime consuming and expen- sive, but also usurped trunk space, which was seen as a crirical comperirive sales factor. One of the pro- ducrion modificarions to the tank, however, would have cost only $11 to install, but given the right margins and restricrions of the "limits of 2 000," there was reluctance to make even this relarively minor change. There were other reasons for not approving the change, as well, including a wide- spread industry belief that all small cars were inherently unsafe solely because of their size and weight. Another more prominent reason was a corporate belief that "safety doesn't sell." This obser- varion was attributed to Lee Iacocca and stemmed from Ford's earlier attempt to make safety a sales theme, an attempt that failed rather dismally in the marketplace.

Perhaps the most controversial reason for reject- ing the producrion change to the gas tank, however, was Ford's use of cost-benefit analysis to jusrify the decision. The Narional Highway Traffic Safety Asso- ciarion (NHTSA, a federal agency) had approved the use of cost-benefit analysis as an appropriate means for establishing automorive safety design standards. The controversial aspect in making such calcularions v̂ ras that they required the assignment of some specific value for a human life. In 1970, that value was deemed to be approximately $200 000 as a "cost to society" for each fatality. Ford used NHTSA's figures in esrimaring the costs and benefits of altering the tank producrion design. An internal memo, later revealed in court, indicates the follow- ing tabularions concerning potenrial fires (Dowie, 1977):

Costs: $137000000 (Estimated as the costs of a production fix to all similarly designed cars and trucks with the gas tank aft of the axle (12 500 000 vehicles X $11/vehicle))

Benefits: $49530000 (Estimated as the savings from preventing (180 projected deaths x $200 000/ death) + (180 projected burn injuries X $67 000/injury) + (2 100 burned cars X $700/car))

The cost-benefit decision was then construed as

straightforward: No producrion fix would be under- taken. The philosophical and ethical implicarions of assigning a financial value for human life or dis- figurement do not seem to have been a major considerarion in reaching this decision.

Pintos and personal experience

When I took over the Recall Coordinator's job in 1973 I inherited the oversight of about 100 acrive recall campaigns, more than half of which were safety-related. These ranged from minimal in size (replacing front wheels that were likely to break on 12 heavy trucks) to maximal (repairing the power steering pump on millions of cars). In addition, there were quite a number of safety problems that were under considerarion as candidates for addirion to the recall list. (Actually, "problem" was a word whose public use was forbidden by the legal office at the rime, even in service bullerins, because it suggested corporate admission of culpability. "Condirion" was the sancrioned catchword.) In addirion to these potenrial recall candidates, there were many files containing field reports of alleged component failure (another forbidden word) that had led to accidents, and in some cases, passenger injury. Beyond these exisring files, I began to construct my own files of incoming safety problems.

One of these new files concerned reports of Pintos "lighring up" (in the words of a field representarive) in rear-end accidents. There were actually very few reports, perhaps because component failure was not inirially assumed. These cars simply were consumed by fire after apparently very low speed accidents. Was there a problem? Not as far as I was concerned. My cue for labelir^ a case as a problem either required high frequencies of occurrence or directly- traceable causes. I had litde rime for specularive

382 Dennis A. Gioia

contemplarion on potenrial problems that did not fit a pattern that suggested known courses of acrion leading to possible recall. I do, however, remember being disquieted by a field report accompanied by graphic, detailed photos of the remains of a burned- out Pinto in which several people had died. Al- though that report became part of my file, I did not flag it as any special case.

It is difficult to convey the overwhelming com- plexity and pace of the job of keeping track of so many acrive or potenrial recall campaigns. It remains the busiest, most informarion-filled job I have ever held or would want to hold. Each case required a myriad of informarion-gathering and execurion stages. I disrinctly remember that the informarion- processing demands led me to confuse the facts of one problem case with another on several occasions because the tell-tale signs of recall candidate cases were so similar. I thought of myself as a fireman — a fireman who perfectly fit the descriprion by one of my colleagues: "In this office everything is a crisis. You only have rime to put out the big fires and spit on the little ones." By those standards the Pinto problem was disrinctly a little one.

It is also important to convey the muring of emorion involved in the Recall Coordinator's job. I remember contemplaring the fact that my job literally involved life-and-death matters. I was some- rimes responsible for finding and fixing cars NOW, because somebody's life might depend on it. I took it very seriously. Early in thejob, I somerimes woke up at night wondering whether I had covered all the bases. Had I left some unknown person at risk because I had not thought of something? That soon faded, however, and of necessity the considerarion of people's lives became a fairly removed, dispassionate process. To do the job "well" there was little room for emorion. Allowing it to surface was potenrially paralyzing and prevented rarional decisions about which cases to recommend for recall. On moral grounds I knew I could recommend most of the vehicles on my safety tracking list for recall (and risk earning the label of a "bleeding heart"). On pracrical grounds, I recognized that people implicitly accept risks in cars. We could not recall all cars with potential problems and stay in business. I learned to be responsive to those cases that suggested an immi- nent, dangerous problem.

I should also note, that the country was in the

midst of its first, and worst, oil crisis at this rime. The effects of the crisis had cast a pall over Ford and the rest of the automobile industry. Ford's product line, with the perhaps notable exceprion of the Pinto and Maverick small cars, was not well-suited to dealing with the crisis. Layoffs were imminent for many people. Recalling the Pinto in this context would have damaged one of the few trump cards the company had (although, quite frankly, I do not remember overtly thinking about that issue).

Pinto reports conrinued to trickle in, but at such a slow rate that they really did not capture parricular attenrion relarive to other, more pressing safety problems. However, I later saw a crumpled, burned car at a Ford depot where alleged problem com- ponents and vehicles were delivered for inspecrion and analysis (a place known as the "Chamber of Horrors" by some of the people who worked there). The revulsion on seeing this incinerated hulk was immediate and profound. Soon afterwards, and despite the fact that the file was very sparse, I recom- mended the Pinto case for preliminary department- level review concerning possible recall. After the usual round of discussion about criteria and jusrifi- carion for recall, everyone voted against recom- mending recall — including me. It did not fit the pattern of recallable standards; the evidence was not overwhelming that the car was defecrive in some way, so the case was actually fairly straightforward. It was a good business decision, even if people might be dying. (We did not then know about the pre- producrion crash test data that suggested a high rate of tank failures in "normal" accidents (cf, Perrow, 1984) or an abnormal failure mode.)

Later, the existence of the crash test data did become known within Ford, which suggested that the Pinto might actually have a recallable problem. This information led to a reconsiderarion of the case within our office. The data, however, prompted a comparison of the Pinto's survivability in a rear end accident with that of other comperitors' small cars. These comparisons revealed that although many cars in this subcompact class suffered appalling deforma- rion in relarively low speed collisions, the Pinto was merely the worst of a bad lot. Furthermore, the gap between the Pinto and the comperirion was not dramaric in terms of the speed at which fuel tank rupture was likely to occur. On that basis it would be difficult to jusrify the recall of cars that were

Pinto Fires and Personal Ethia 383

comparable with others on the market. In the face of even more compelling evidence that people were probably going to die in this car, I again included myself in a group of decision makers who voted not to recommend recall to the higher levels of the organizarion.

Coda to the corporate case

Subsequent to my departure from Ford in 1975, reports of Pinto fires escalated, attracring increasing media attenrion, almost all of it crirical of Ford. Anderson and Whitten (1976) revealed the internal memos concerning the gas tank problem and ques- rioned how the few dollars saved per car could be jusrified when human lives were at stake. Shordy thereafter, a scathing arricle by Dowie (1977) at- tacked not only the Pinto's design, but also accused Ford of gross negligence, stonewalling, and unethical corporate conduct by alleging that Ford knowingly sold "firetraps" after willfully calcularing the cost of lives against profits (see also Gatewood and Carroll, 1983). Dowie's provocarive quote specularing on "how long the Ford Motor Company would con- rinue to market lethal cars were Henry Ford II and Lee Iacocca serving 20 year terms in Leavenworth for consumer homicide" (1977, p. 32) was parricu- larly effecrive in focusing attenrion on the case. Public senriment edged toward labehng Ford as socially deviant because management was seen as knowing that the car was defecrive, choosing profit over lives, resisring demands to fix the car, and apparently showing no public remorse (Swigert and Farrell, 1980-81).

Shordy after Dowie's (1977) expose, NHTSA iniriated its own invesrigarion. Then, early in 1978 a jury awarded a Pinto burn vicrim $125 million in punirive damages (later reduced to $6.6 million , a judgment upheld on an appeal that prompted the judge to assert that "Ford's insriturional mentality was shown to be one of callous indifference to public safety" (quoted in Cullen etal, 1987, p. 164)). A siege atmosphere emerged at Ford. Insiders characterized the mounring media campaign as "hysterical" and "a crusade against us" (personal communicarions). The crisis deepened. In the summer of 1978 NHTSA issued a formal determinarion that the Pinto was defecrive. Ford then launched a reluctant recall of all

1971—1976 cars (those built for the 1977 model year were equipped with a producrion fix prompted by the adoprion of the FMVSS 301 gas tank standard). Ford hoped that the issue would then recede, but worse was yet to come.

The culminarion of the case and the demise of the Pinto itself began in Indiana on August 10, 1978, when three teenage girls died in a fire triggered after their 1973 Pinto was hit from behind by a van. A grand jury took the unheard of step of indicring Ford on charges of reckless homicide (Cullen et al, 1987). Because of the precedent-setring possibiliries for all manufacturing industries. Ford assembled a formidable legal team headed by Watergate prose- cutor James Neal to defend itself at the trial. The trial was a media event; it was the first rime that a corporarion was tried for alleged criminal behavior. After a protracted, acrimonious courtroom battle that included vivid clashes among the opposing attorneys, surprise witnesses, etc., the jury ulrimately found in favor of Ford. Ford had dodged a bullet in the form of a consequenrial legal precedent, but because of the negarive publicity of the case and the charges of corporate crime and ethical deviance, the conduct of manufacturing businesses was altered, probably forever. As a relarively minor footnote to the case. Ford ceased producrion of the Pinto.

Coda to the personal case

In the intervening years since my early involvement with the Pinto fire case, I have given repeated considerarion to my role in it. Although most of the ethically quesrionable acrions that have been cited in the press are associated with Ford's intenrional stonewalling after it was clear that the Pinto was defecrive (see Cullen et al, 1986; Dowie, 1977; Gatewood and Carroll, 1983) — and thus postdate my involvement with the case and the company — I still nonetheless wonder about my own culpability. Why didn't I see the gravity of the problem and its ethical overtones? What happened to the value system I carried with me into Ford? Should I have acted differendy, given what I knew then? The experience with myself has somerimes not been pleasant. Somehow, it seems I should have done something different that might have made a differ-

ence.

384 Dennis A. Gioia

As a consequence of this line of thinking and feeling, some years ago I decided to construct a "living case" out of my experience vwth the Pinto fire problem for use in my MBA classes. The written case descriprion contains many of the facts detailed above; the analyrical task of the class is to ask appropriate quesrions of me as a figure in the case to reveal the central issues involved. It is somewhat of a trying experience to get through these classes. After getring to know me for most of the semester, and then finding out that I did not vote to recommend recall, students are often incredulous, even angry at me for apparently not having lived what I have been teaching. To be fair and even-handed here, many students understand my acrions in the context of the rimes and the atritudes prevalent then. Others, however, are very disappointed that I appear to have failed during a rime of trial. Consequendy, I am accused of being a charlatan and otherwise vilified by those who maintain that ethical and moral prin- ciples should have prevailed in this case no matter what the mirigating circumstances. Those are the ones that hurt.