Hematal

Problem: Dr. Rini's main and immediate problem is whether to decide on further giving credit to the boy's family or not. It is influenced by the following critical factors:

1. Hematal's cash flow problem limits Hematal's decision on giving further credit to the boy's family or not. It has been proved in the case that the family is very poor and won't be able to pay right away and most probably won't be able to pay anymore considering also the increasing hospitalization bills. This fact is important because Hematal will already have to consider writing off of the family's debt, which further affects the company's cash position in the future when she gives additional credit. The boy needs at least 20 more vials yet, Hematal has less than 20 vials left on stock. With this fact, I have assumed that Dr. Rini's decision should be an "all or nothing" kind of decision because anything less will not make any difference in the boy's condition considering also the fact that he needed more than 40 vials during his initial surgery, thus I conclude that the boy will die if less than 20 vials were provided. Therefore, Hematal will have to order more vials from Gamma Corp. to fill the 20 vial requirement.

2. Media exposure and NGO support/protest can both be helpful and detrimental to Hemetal's reputation as a pharmaceutical company. Pharmaceutical companies need to gain the trust of the public for the end consumers to patronize its products. Getting bad publicity, especially being "young" in the industry, will greatly affect the company's sales and its life.

3. Hematal will need to maintain a certain stocking level for the regular paying customers brought in by their Hemophiliac Society as they may need their supply of Factor-A Concentrate. This fact will mean that Hematal will have to order more than the required number of vials for stocking. If Hematal does not order to keep stocking levels and decides to deplete its stocks for the boy, regular paying customers may create an issue with the Hemophiliac Society and not get their support anymore. Hemophiliac Society may also cause bad publicity to Hematal by voicing out their concerns and protests. Moreover, the Society can influence Gamma into changing its exclusive distributor in the country.

4. Dr. Rini's conscience and peace of mind will be greatly affected with her commitment as a doctor based on the Hippocratic Oath if she decides not to help. Furthermore, she also personally assured the boy of Hematal's help. Her statement as Managing Director of Hematal can be used upon her if she decides not to help the boy anymore.

Option 1: Dr. Rini can be firm about not giving further credit by supplying 20 vials to the family and start thinking like a manager by concentrating on ways to keep Hematal's head above water with its cash flow problems. Hematal will not have to worry about having the Hemophiliac Society creating a ruckus and cause the company to have a bad reputation. This alternative will most likely cause media to make an even bigger impact to Hematal's reputation especially when the boy dies, with the NGO monitoring the boy's condition. There is a possibility that the bad reputation move up to affect Gamma Corp. because its name will be connected to Hematal being the exclusive distributor. Moreover, there is no guarantee that Dr. Rini will ever have the peace of mind knowing that she did not help the boy.

Option 2: Dr. Rini provides the 20 vials as requested by the boy's family while ordering only the required number plus a minimal number for stocking level as far as their available cash allows them without sacrificing cash for wages and other critical expenses. This alternative will immediately solve Dr. Rini's promise to help the boy, but this doesn't give much flexibility as she'll be taking the risk that Hematal's regular clients will need more than what it has on stock and will require them to order in rush. Also, it doesn't give Dr. Rini much room to move and plan for her next action when the family asks for more vials, which is highly probable to happen. And once this happens, media and NGO action may still act negatively when Hematal is unable to give in to further requests and the boy dies. This alternative also puts Hematal into more dangerous condition by adding to the cash flow problem because the additional credit for the supplied 20 vials still has the high probability that it won't be collected.

Option 3, chosen decision and action plan: Dr. Rini should lead all involved stakeholders and influential parties into working together to raise funds and provide all the help every element can get for the boy. Dr. Rini should see and illustrate the situation as an opportunity to bring not only Hematal, but all stakeholders, in the lime light and reach individual objectives. The following action items should be done by Dr. Rini:

1. Convince the parents of the boy to agree on allowing and participating to raise funds with media exposure. Dr. Rini should set a personal meeting with the caller. She should personally propose and explain to the parents her plan to show her sincerity. By not doing this through the telephone in her office, she exposes to the parents she, herself is powerless. During the meeting, she will admit to the parents that Hematal has less than 20 vials left on stock, thus, they will need to order from the Netherlands. She can then suggest to the parents about her idea of a fund raising campaign that will involve media exposure. She has to explain that the campaign may raise enough funds to cover the family's debt and probably future medical bills; with warning that at worst, but at the very least the funds that can be generated will be a big help in covering a part of their debt. This has a high probability of the parents agreeing because of desperation and because besides the NGO who previously gave assistance to pay for 2 vials, Hematal is the only one who had been of great help to the family. Hematal will lead this campaign