For seven years the Ford Motor Company sold cars in which it k.docx

For seven years the Ford Motor Company sold cars in which it
knew hundreds of people would needlessly burn to death.
By Mark Dowie | September/October 1977 Issue
One evening in the mid-1960s, Arjay Miller was driving home
from his office in Dearborn, Michigan [1], in the four-door
Lincoln
Continental that went with his job as president of the Ford
Motor Company [2]. On a crowded highway, another car struck
his from the
rear. The Continental spun around and burst into flames.
Because he was wearing a shoulder-strap seat belt, Miller was
unharmed by the
crash, and because his doors didn't jam he escaped the gasoline-
drenched, flaming wreck. But the accident made a vivid
impression on
him. Several months later, on July 15, 1965, he recounted it to a
U.S. Senate subcommittee that was hearing testimony on auto
safety
legislation. "I still have burning in my mind the image of that
gas tank on fire," Miller said. He went on to express an almost
passionate
interest in controlling fuel-fed fires in cars that crash or roll
over. He spoke with excitement about the fabric gas tank Ford
was testing at

that very moment. "If it proves out," he promised the senators,
it will be a feature you will see in our standard cars."
Almost seven years after Miller's testimony, a woman, whom
for legal reasons we will call Sandra Gillespie, pulled onto a
Minneapolis
highway in her new Ford Pinto. Riding with her was a young
boy, whom we'll call Robbie Carlton. As she entered a merge
lane, Sandra
Gillespie's car stalled. Another car rear-ended hers at an impact
speed of 28 miles per hour. The Pinto's gas tank ruptured.
Vapors from it
mixed quickly with the air in the passenger compartment. A
spark ignited the mixture and the car exploded in a ball of fire.
Sandra died
in agony a few hours later in an emergency hospital. Her
passenger, 13-year-old Robbie Carlton, is still alive; he has just
come home
from another futile operation aimed at grafting a new ear and
nose from skin on the few unscarred portions of his badly
burned body.
(This accident is real; the details are from police reports.)
Why did Sandra Gillespie's Ford Pinto catch fire so easily,
seven years after Ford's Arjay Miller made his apparently
sincere
pronouncements—the same seven years that brought more safety
improvements to cars than any other period in automotive

history? An
extensive investigation by Mother Jones over the past six
months has found these answers:
Fighting strong competition from Volkswagen [3] for the
lucrative small-car market, the Ford Motor Company rushed the
Pinto
into production in much less than the usual time.
Ford engineers discovered in pre-production crash tests that
rear-end collisions would rupture the Pinto's fuel system
extremely
easily.
Because assembly-line machinery was already tooled when
engineers found this defect, top Ford officials decided to
manufacture
the car anyway—exploding gas tank and all—even though Ford
owned the patent on a much safer gas tank.
For more than eight years afterwards, Ford successfully lobbied,
with extraordinary vigor and some blatant lies, against a key
government safety standard that would have forced the company
to change the Pinto's fire-prone gas tank.
By conservative estimates Pinto crashes have caused 500 burn
deaths to people who would not have been seriously injured if
the
car had not burst into flames. The figure could be as high as
900. Burning Pintos have become such an embarrassment to

Ford that
its advertising agency, J. Walter Thompson, dropped a line from
the end of a radio spot that read "Pinto leaves you with that
warm
feeling."
Ford knows the Pinto is a firetrap, yet it has paid out millions to
settle damage suits out of court, and it is prepared to spend
millions more lobbying against safety standards. With a half
million cars rolling off the assembly lines each year, Pinto is
the
Pinto Madness http://www.motherjones.com/print/15405
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biggest-selling subcompact in America, and the company's
operating profit on the car is fantastic. Finally, in 1977, new
Pinto
models have incorporated a few minor alterations necessary to
meet that federal standard Ford managed to hold off for eight
years.
Why did the company delay so long in making these minimal,
inexpensive improvements?
Ford waited eight years because its internal "cost-benefit
analysis," which places a dollar value on human life, said it
wasn't

profitable to make the changes sooner.
Before we get to the question of how much Ford thinks your life
is worth, let's trace the history of the death trap itself. Although
this particular story is about the Pinto, the way in which Ford
made its decision is typical of the U.S. auto industry generally.
There
are plenty of similar stories about other cars made by other
companies. But this case is the worst of them all.
The next time you drive behind a Pinto (with over two million
of them on the road, you shouldn't have much trouble finding
one),
take a look at the rear end. That long silvery object hanging
down under the bumper is the gas tank. The tank begins about
six
inches forward of the bumper. In late models the bumper is
designed to withstand a collision of only about five miles per
hour.
Earlier bumpers may as well not have been on the car for all the
protection they offered the gas tank.
Mother Jones has studied hundreds of reports and documents on
rear-end collisions involving Pintos. These reports conclusively
reveal that if you ran into that Pinto you were following at over
30 miles per hour, the rear end of the car would buckle like an
accordion, right up to the back seat. The tube leading to the gas-
tank cap would be ripped away from the tank itself, and gas
would

immediately begin sloshing onto the road around the car. The
buckled gas tank would be jammed up against the differential
housing (that big bulge in the middle of your rear axle), which
contains four sharp, protruding bolts likely to gash holes in the
tank
and spill still more gas. Now all you need is a spark from a
cigarette, ignition, or scraping metal, and both cars would be
engulfed
in flames. If you gave that Pinto a really good whack—say, at
40 mph—chances are excellent that its doors would jam and you
would have to stand by and watch its trapped passengers burn to
death.
[4]
This scenario is no news to Ford. Internal company documents
in our possession show that Ford has crash-tested the Pinto at a
top-secret site more than 40 times and that every test made at
over 25 mph without special structural alteration of the car has
resulted in a ruptured fuel tank. Despite this, Ford officials
denied under oath having crash-tested the Pinto.
Eleven of these tests, averaging a 31-mph impact speed, came
before Pintos started rolling out of the factories. Only three cars
passed the test with unbroken fuel tanks. In one of them an
inexpensive light-weight plastic baffle was placed between the
front of

the gas tank and the differential housing, so those four bolts
would not perforate the tank. (Don't forget about that little
piece of
plastic, which costs one dollar and weighs one pound. It plays
an important role in our story later on.) In another successful
test, a
piece of steel was placed between the tank and the bumper. In
the third test car the gas tank was lined with a rubber bladder.
But
none of these protective alterations was used in the mass-
produced Pinto.
In pre-production planning, engineers seriously considered
using in the Pinto the same kind of gas tank Ford uses in the
Capri. The
Capri tank rides over the rear axle and differential housing. It
has been so successful in over 50 crash tests that Ford used it in
its
Experimental Safety Vehicle, which withstood rear-end impacts
of 60 mph. So why wasn't the Capri tank used in the Pinto? Or,
why wasn't that plastic baffle placed between the tank and the
axle—something that would have saved the life of Sandra
Gillespie
and hundreds like her? Why was a car known to be a serious fire
hazard deliberately released to production in August of 1970?

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Whether Ford should manufacture subcompacts at all was the
subject of a bitter two-year debate at the company's Dearborn
headquarters. The principals in this corporate struggle were the
then-president Semon "Bunky" Knudsen, whom Henry Ford II
had
hired away from General Motors [5], and Lee Iacocca, a spunky
Young Turk who had risen fast within the company on the
enormous success of the Mustang. Iacocca argued forcefully
that Volkswagen and the Japanese were going to capture the
entire
American subcompact market unless Ford put out its own
alternative to the VW Beetle. Bunky Knudsen said, in effect: let
them
have the small-car market; Ford makes good money on medium
and large models. But he lost the battle and later resigned.
Iacocca
became president and almost immediately began a rush program
to produce the Pinto.
Like the Mustang, the Pinto became known in the company as
"Lee's car." Lee Iococca wanted that little car in the showrooms
of
America with the 1971 models. So he ordered his engineering
vice president, Bob Alexander, to oversee what was probably
the

shortest production planning period in modern automotive
history. The normal time span from conception to production of
a new
car model is about 43 months. The Pinto schedule was set at just
under 25.
A quick glance at the bar chart below will show you what that
speed-up meant. Design, styling, product planning,advance
engineering and quality assurance all have flexible time frames,
and engineers can pretty much carry these on simultaneously.
Tooling, on the other hand, has a fixed time frame of about 18
months. Normally, an auto company doesn't begin tooling until
the
other processes are almost over: you don't want to make the
machines that stamp and press and grind metal into the shape of
car
parts until you know all those parts will work well together. But
Iacocca's speed-up meant Pinto tooling went on at the same time
as product development. So when crash tests revealed a serious
defect in the gas tank, it was too late. The tooling was well
under
way.
When it was discovered the gas tank was unsafe, did anyone go
to Iacocca and tell him? "Hell no," replied an engineer who
worked
on the Pinto, a high company official for many years, who,

unlike several others at Ford, maintains a necessarily
clandestine
concern for safety. "That person would have been fired. Safety
wasn't a popular subject around Ford in those days. With Lee it
was
taboo. Whenever a problem was raised that meant a delay on the
Pinto, Lee would chomp on his cigar, look out the window and
say 'Read the product objectives and get back to work.'"
The product objectives are clearly stated in the Pinto "green
book." This is a thick, top-secret manual in green covers
containing a
step-by-step production plan for the model, detailing the
metallurgy, weight, strength and quality of every part in the car.
The
product objectives for the Pinto are repeated in an article by
Ford executive F.G. Olsen published by the Society of
Automotive
Engineers. He lists these product objectives as follows:
1. TRUE SUBCOMPACT
Size
Weight
2. LOW COST OF OWNERSHIP
Initial price

Fuel consumption
Reliability
Serviceability
3. CLEAR PRODUCT SUPERIORITY
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Appearance
Comfort
Features
Ride and Handling
Performance
Safety, you will notice, is not there. It is not mentioned in the
entire article. As Lee Iacocca was fond of saying, "Safety
doesn't
sell."
Heightening the anti-safety pressure on Pinto engineers was an
important goal set by Iacocca known as "the limits of 2,000."
The Pinto
was not to weigh an ounce over 2,000 pounds and not to cost a
cent over $2,000. "Iacocca enforced these limits with an iron

hand,"
recalls the engineer quoted earlier. So, even when a crash test
showed that that one-pound, one-dollar piece of plastic stopped
the
puncture of the gas tank, it was thrown out as extra cost and
extra weight.
People shopping for subcompacts are watching every dollar.
"You have to keep in mind," the engineer explained, "that the
price elasticity
on these subcompacts is extremely tight. You can price yourself
right out of the market by adding $25 to the production cost of
the model.
And nobody understands that better than Iacocca."
Dr. Leslie Ball, the retired safety chief for the NASA [6]
manned space program and a founder of the International
Society of Reliability
Engineers, recently made a careful study of the Pinto. "The
release to production of the Pinto was the most reprehensible
decision in the
history of American engineering," he said. Ball can name more
than 40 European and Japanese models in the Pinto price and
weight
range wit h safer gas-tank positioning. Ironically, many of
them, like the Ford Capri, contain a "saddle-type" gas tank
riding over the back
axle. The patent on the saddle-type tank is owned by the Ford

Motor Co.
Los Angeles auto safety expert Byron Bloch has made an in-
depth study of the Pinto fuel system. "It's a catastrophic
blunder," he says.
"Ford made an extremely irresponsible decision when they
placed such a weak tank in such a ridiculous location in such a
soft rear end.
It's almost designed to blow up—premeditated."
A Ford engineer, who doesn't want his name used, comments:
"This company is run by salesmen, not engineers; so the priority
is styling,
not safety." He goes on to tell a story about gas-tank safety at
Ford:
Lou Tubben is one of the most popular engineers at Ford. He's a
friendly, outgoing guy with a genuine concern for safety. By
1971 he had
grown so concerned about gas-tank integrity that he asked his
boss if he could prepare a presentation on safer tank design.
Tubben and his
boss had both worked on the Pinto and shared a concern for its
safety. His boss gave him the go-ahead, scheduled a date for the
presentation and invited all company engineers and key
production planning personnel. When time came for the
meeting, a grand total of
two people showed up—Lou Tubben and his boss.

"So you see," continued the anonymous Ford engineer
ironically, "there are a few of us here at Ford who are
concerned about fire safety."
He adds: "They are mostly engineers who have to study a lot of
accident reports and look at pictures of burned people. But we
don't talk
about it much. It isn't a popular subject. I've never seen safety
on the agenda of a product meeting and, except for a brief
period in 1956, I
can't remember seeing the word safety in an advertisement. I
really don't think the company wants American consumers to
start thinking
too much about safety—for fear they might demand it, I
suppose."
Asked about the Pinto gas tank, another Ford engineer admitted:
"That's all true. But you miss the point entirely. You see, safety
isn't the
issue, trunk space is. You have no idea how stiff the
competition is over trunk space. Do you realize that if we put a
Capri-type tank in the
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Pinto you could only get one set of golf clubs in the trunk?"

Blame for Sandra Gillespie's death, Robbie Carlton's
unrecognizable face and all the other injuries and deaths in
Pintos since 1970 does
not rest on the shoulders of Lee Iacocca alone. For, while he
and his associates fought their battle against a safer Pinto in
Dearborn, a
larger war against safer cars raged in Washington. One skirmish
in that war involved Ford's successful eight-year lobbying effort
against
Federal Motor Vehicle Safety Standard 301, the rear-end
provisions of which would have forced Ford to redesign the
Pinto.
But first some background:
During the early '60s, auto safety legislation became the bête-
noire of American big business. The auto industry was the last
great
unregulated business, and if it couldn't reverse the tide of
government regulation, the reasoning went, no one could.
People who know him cannot remember Henry Ford II taking a
stronger stand than the one he took against the regulation of
safety [7]
design. He spent weeks in Washington calling on members of
Congress, holding press conferences and recruiting business
cronies like
W.B. Murphy of Campbell's Soup to join the anti-regulation
battle. Displaying the sophistication for which today's American
corporate

leaders will be remembered, Murphy publicly called auto safety
"a hula hoop, a fad that will pass." He was speaking to a special
luncheon of the Business Council, an organization of 100 chief
executives who gather periodically in Washington to provide
"advice" and
"counsel" to government. The target of their wrath in this
instance was the Motor Vehicle Safety Bills introduced in both
houses of
Congress, largely in response to Ralph Nader's Unsafe at Any
Speed.
By 1965, most pundits and lobbyists saw the handwriting on the
wall and prepared to accept government "meddling" in the last
bastion of
free enterprise. Not Henry. With bulldog tenacity, he held out
for defeat of the legislation to the very end, loyal to his
grandfather's
invention and to the company that makes it. But the Safety Act
passed the House and Senate unanimously, and was signed into
law by
Lyndon Johnson in 1966.
While lobbying for and against legislation is pretty much a
process of high-level back-slapping, press-conferencing and
speech-making,
fighting a regulatory agency is a much subtler matter. Henry
headed home to lick his wounds in Grosse Pointe, Michigan,
and a planeload

of the Ford Motor Company's best brains flew to Washington to
start the "education" of the new federal auto safety bureaucrats.
Their job was to implant the official industry ideology in the
minds of the new officials regulating auto safety. Briefly
summarized, that
ideology states that auto accidents are caused not by cars, but
by 1) people and 2) highway conditions.
This philosophy is rather like blaming a robbery on the victim.
Well, what did you expect? You were carrying money, weren't
you? It is
an extraordinary experience to hear automotive "safety
engineers" talk for hours without ever mentioning cars. They
will advocate
spending billions educating youngsters, punishing drunks and
redesigning street signs. Listening to them, you can
momentarily begin to
think that it is easier to control 100 million drivers than a
handful of manufacturers. They show movies about guardrail
design and
advocate the clear-cutting of trees 100 feet back from every
highway in the nation. If a car is unsafe, they argue, it is
because its owner
doesn't properly drive it. Or, perhaps, maintain it.
In light of an annual death rate approaching 50,000, they are
forced to admit that driving is hazardous. But the car is, in the
words of

Arjay Miller, "the safest link in the safety chain."
Before the Ford experts left Washington to return to drafting
tables in Dearborn they did one other thing. They managed to
informally
reach an agreement with the major public servants who would
be making auto safety decisions. This agreement was that "cost-
benefit"
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would be an acceptable mode of analysis by Detroit and its new
regulators. And, as we shall see, cost-benefit analysis quickly
became the
basis of Ford's argument against safer car design.
Cost-benefit analysis was used only occasionally in government
until President Kennedy appointed Ford Motor Company
president
Robert McNamara to be Secretary of Defense. McNamara,
originally an accountant, preached cost-benefit with all the
force of a Biblical
zealot. Stated in its simplest terms, cost-benefit analysis says
that if the cost is greater than the benefit, the project is not
worth it—no
matter what the benefit. Examine the cost of every action,

decision, contract part or change, the doctrine says, then
carefully evaluate the
benefits (in dollars) to be certain that they exceed the cost
before you begin a program or—and this is the crucial part for
our story—pass
a regulation.
As a management tool in a business in which profits matter over
everything else, cost-benefit analysis makes a certain amount of
sense.
Serious problems come, however, when public officials who
ought to have more than corporate profits at heart apply cost-
benefit analysis
to every conceivable decision. The inevitable result is that they
must place a dollar value on human life.
Ever wonder what your life is worth [8] in dollars? Perhaps $10
million? Ford has a better idea: $200,000.
Remember, Ford had gotten the federal regulators to agree to
talk auto safety in terms of cost-benefit analysis. But in order to
be able to
argue that various safety costs were greater than their benefits,
Ford needed to have a dollar value figure for the "benefit."
Rather than be
so uncouth as to come up with such a price tag itself, the auto
industry pressured the National Highway Traffic Safety
Administration to
do so. And in a 1972 report the agency decided a human life

was worth $200,725. Inflationary forces have recently pushed
the figure up
to $278,000.
Furnished with this useful tool, Ford immediately went to work
using it to prove why various safety improvements were too
expensive to
make.
Nowhere did the company argue harder that it should make no
changes than in the area of rupture-prone fuel tanks. Not long
after the
government arrived at the $200,725-per-life figure, it surfaced,
rounded off to a cleaner $200,000, in an internal Ford
memorandum [9].
This cost-benefit analysis argued that Ford should not make an
$11-per-car improvement that would prevent 180 fiery deaths a
year. (This
minor change would have prevented gas tanks from breaking so
easily both in rear-end collisions, like Sandra Gillespie's, and in
rollover
accidents, where the same thing tends to happen.)
Ford's cost-benefit table is buried in a seven-page company
memorandum entitled "Fatalities Associated with Crash-Induced
Fuel
Leakage and Fires." The memo argues that there is no financial
benefit in complying with proposed safety standards that would

admittedly result in fewer auto fires, fewer burn deaths and
fewer burn injuries. Naturally, memoranda that speak so
casually of "burn
deaths" and "burn injuries" are not released to the public. They
are very effective, however, with Department of Transportation
officials
indoctrinated in McNamarian cost-benefit analysis.
All Ford had to do was convince men like John Volpe, Claude
Brinegar and William Coleman (successive Secretaries of
Transportation
during the Nixon-Ford years) that certain safety standards
would add so much to the price of cars that fewer people would
buy them. This
could damage the auto industry, which was still believed to be
the bulwark of the American economy. "Compliance to these
standards,"
Henry Ford II prophesied at more than one press conference,
"will shut down the industry."
The Nixon Transportation Secretaries were the kind of
regulatory officials big business dreams of. They understood
and loved capitalism
and thought like businessmen. Yet, best of all, they came into
office uninformed on technical automotive matters. And you
could talk
"burn injuries" and "burn deaths" with these guys, and they
didn't seem to envision children crying at funerals and people
hiding in their

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homes with melted faces. Their minds appeared to have leapt
right to the bottom line—more safety meant higher prices,
higher prices
meant lower sales and lower sales meant lower profits.
So when J. C. Echold, Director of Automotive Safety (which
means chief anti-safety lobbyist) for Ford, wrote to the
Department of
Transportation—which he still does frequently, at great
length—he felt secure attaching a memorandum that in effect
says it is acceptable
to kill 180 people and burn another 180 every year, even though
we have the technology that could save their lives for $11 a car.
Furthermore, Echold attached this memo, confident, evidently,
that the Secretary would question neither his low death/injury
statistics nor
his high cost estimates. But it turns out, on closer examination,
that both these findings were misleading.
First, note that Ford's table shows an equal number of burn
deaths and burn injuries. This is false. All independent experts
estimate that
for each person who dies by an auto fire, many more are left

with charred hands, faces and limbs. Andrew McGuire of the
Northern
California Burn Center estimates the ratio of burn injuries to
deaths at ten to one instead of the one to one Ford shows here.
Even though
Ford values a burn at only a piddling $67,000 instead of the
$200,000 price of a life, the true ratio obviously throws the
company's
calculations way off.
The other side of the equation, the alleged $11 cost of a fire-
prevention device, is also a misleading estimation. One
document that was
not sent to Washington by Ford was a "Confidential" cost
analysis Mother Jones has managed to obtain, showing that
crash fires could be
largely prevented for considerably less than $11 a car. The
cheapest method involves placing a heavy rubber bladder inside
the gas tank to
keep the fuel from spilling if the tank ruptures. Goodyear had
developed the bladder and had demonstrated it to the
automotive industry.
We have in our possession crash-test reports showing that the
Goodyear bladder worked well. On December 2, 1970 (two
years before
Echold sent his cost-benefit memo to Washington), Ford Motor
Company ran a rear-end crash test on a car with the rubber
bladder in the

gas tank. The tank ruptured, but no fuel leaked. On January 15,
1971, Ford again tested the bladder and again it worked. The
total
purchase and installation cost of the bladder would have been
$5.08 per car. That $5.08 could have saved the lives of Sandra
Gillespie
and several hundred others.
When a federal regulatory agency like the National Highway
Traffic Safety Administration (NHTSA) decides to issue a new
standard, the
law usually requires it to invite all interested parties to respond
before the standard is enforced—a reasonable enough custom on
the
surface. However, the auto industry has taken advantage of this
process and has used it to delay lifesaving emission and safety
standards
for years. In the case of the standard that would have corrected
that fragile Pinto fuel tank, the delay was for an incredible eight
years.
The particular regulation involved here was Federal Motor
Vehicle Safety Standard 301. Ford picked portions of Standard
301 for strong
opposition way back in 1968 when the Pinto was still in the
blueprint stage. The intent of 301, and the 300 series that
followed it, was to

protect drivers and passengers after a crash occurs. Without
question the worst post-crash hazard is fire. So Standard 301
originally
proposed that all cars should be able to withstand a fixed barrier
impact of 20 mph (that is, running into a wall at that speed)
without
losing fuel.
When the standard was proposed, Ford engineers pulled their
crash-test results out of their files. The front ends of most cars
were no
problem—with minor alterations they could stand the impact
without losing fuel. "We were already working on the front
end," Ford
engineer Dick Kimble admitted. "We knew we could meet the
test on the front end." But with the Pinto particularly, a 20-mph
rear-end
standard meant redesigning the entire rear end of the car. With
the Pinto scheduled for production in August of 1970, and with
$200
million worth of tools in place, adoption of this standard would
have created a minor financial disaster. So Standard 301 was
targeted for
delay, and, with some assistance from its industry associates,
Ford succeeded beyond its wildest expectations: the standard
was not

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adopted until the 1977 model year. Here is how it happened:
There are several main techniques in the art of combating a
government safety standard: a) make your arguments in
succession, so the
feds can be working on disproving only one at a time; b) claim
that the real problem is not X but Y (we already saw one
instance of this
in "the problem is not cars but people"); c) no matter how
ridiculous each argument is, accompany it with thousands of
pages of highly
technical assertions it will take the government months or,
preferably, years to test. Ford's large and active Washington
office brought
these techniques to new heights and became the envy of the
lobbyists' trade.
The Ford people started arguing against Standard 301 way back
in 1968 with a strong attack of technique b). Fire, they said,
was not the
real problem. Sure, cars catch fire and people burn occasionally.
But statistically auto fires are such a minor problem that
NHTSA should
really concern itself with other matters.
Strange as it may seem, the Department of Transportation

(NHTSA's parent agency) didn't know whether or not this was
true. So it
contracted with several independent research groups to study
auto fires. The studies took months, which was just what Ford
wanted.
The completed studies, however, showed auto fires to be more
of a problem than Transportation officials ever dreamed of.
Robert Nathan
and Associates, a Washington research firm, found that 400,000
cars were burning up every year, burning more than 3,000
people to
death. Furthermore, auto fires were increasing five times as fast
as building fires. Another study showed that 35 per cent of all
fire deaths
in the U.S. occurred in automobiles. Forty per cent of all fire
department calls in the 1960s were to vehicle fires—a public
cost of $350
million a year, a figure that, incidentally, never shows up in
cost-benefit analyses.
Another study was done by the Highway Traffic Research
Institute in Ann Arbor, Michigan, a safety think-tank funded
primarily by the
auto industry (the giveaway there is the words "highway traffic"
rather than "automobile" in the group's name). It concluded that
40 per
cent of the lives lost in fuel-fed fires could be saved if the
manufacturers complied with proposed Standard 301. Finally, a

third report
was prepared for NHTSA by consultant Eugene Trisko entitled
"A National Survey of Motor Vehicle Fires." His report
indicates that the
Ford Motor Company makes 24 per cent of the cars on the
American road, yet these cars account for 42 per cent of the
collision-ruptured
fuel tanks.
Ford lobbyists then used technique a)—bringing up a new
argument. Their line then became: yes, perhaps burn accidents
do happen, but
rear-end collisions are relatively rare (note the echo of
technique b) here as well). Thus Standard 301 was not needed.
This set the
NHTSA off on a new round of analyzing accident reports. The
government's findings finally were that rear-end collisions were
seven and
a half times more likely to result in fuel spills than were front-
end collisions. So much for that argument. By now it was 1972;
NHTSA
had been researching and analyzing for four years to answer
Ford's objections. During that time, nearly 9,000 people burned
to death in
flaming wrecks. Tens of thousands more were badly burned and
scarred for life. And the four-year delay meant that well over 10
million

new unsafe vehicles went on the road, vehicles that will be
crashing, leaking fuel and incinerating people well into the
1980s.
Ford now had to enter its third round of battling the new
regulations. On the "the problem is not X but Y" principle, the
company had to
look around for something new to get itself off the hook. One
might have thought that, faced with all the latest statistics on
the horrifying
number of deaths in flaming accidents, Ford would find the task
difficult. But the company's rhetoric was brilliant. The problem
was not
burns, but...impact! Most of the people killed in these fiery
accidents, claimed Ford, would have died whether the car
burned or not. They
were killed by the kinetic force of the impact, not the fire.
And so once again, as in some giant underwater tennis game,
the ball bounced into the government's court and the absurdly
pro-industry
NHTSA began another slow-motion response. Once again it
began a time-consuming round of test crashes and embarked on
a study of
accidents. The latter, however, revealed that a large and
growing number of corpses taken from burned cars involved in
rear-end crashes

8 of 11
contained no cuts, bruises or broken bones. They clearly would
have survived the accident unharmed if the cars had not caught
fire. This
pattern was confirmed in careful rear-end crash tests performed
by the Insurance Institute for Highway Safety. A University of
Miami
study found an inordinate number of Pintos burning on rear-end
impact and concluded that this demonstrated "a clear and
present hazard
to all Pinto owners."
Pressure on NHTSA from Ralph Nader and consumer groups
began mounting. The industry-agency collusion was so obvious
that
Senator Joseph Montoya (D-N.M.) introduced legislation about
Standard 301. NHTSA waffled some more and again announced
its
intentions to promulgate a rear-end collision standard.
Waiting, as it normally does, until the last day allowed for
response, Ford filed with NHTSA a gargantuan batch of letters,
studies and
charts now arguing that the federal testing criteria were unfair.
Ford also argued that design changes required to meet the
standard would

take 43 months, which seemed like a rather long time in light of
the fact that the entire Pinto was designed in about two years.
Specifically, new complaints about the standard involved the
weight of the test vehicle, whether or not the brakes should be
engaged at
the moment of impact and the claim that the standard should
only apply to cars, not trucks or buses. Perhaps the most
amusing argument
was that the engine should not be idling during crash tests, the
rationale being that an idling engine meant that the gas tank had
to contain
gasoline and that the hot lights needed to film the crash might
ignite the gasoline and cause a fire.
Some of these complaints were accepted, others rejected. But
they all required examination and testing by a weak-kneed
NHTSA,
meaning more of those 18-month studies the industry loves so
much. So the complaints served their real purpose—delay; all
told, an
eight-year delay, while Ford manufactured more than three
million profitable, dangerously incendiary Pintos. To justify
this delay, Henry
Ford II called more press conferences to predict the demise of
American civilization. "If we can't meet the standards when
they are
published," he warned, "we will have to close down. And if we
have to close down some production because we don't meet

standards
we're in for real trouble in this country."
While government bureaucrats dragged their feet on lifesaving
Standard 301, a different kind of expert was taking a close look
at the
Pinto—the "recon man." "Recon" stands for reconstruction;
recon men reconstruct accidents for police departments,
insurance companies
and lawyers who want to know exactly who or what caused an
accident. It didn't take many rear-end Pinto accidents to
demonstrate the
weakness of the car. Recon men began encouraging lawyers to
look beyond one driver or another to the manufacturer in their
search for
fault, particularly in the growing number of accidents where
passengers were uninjured by collision but were badly burned
by fire.
Pinto lawsuits began mounting fast against Ford. Says John
Versace, executive safety engineer at Ford's Safety Research
Center, "Ulcers
are running pretty high among the engineers who worked on the
Pinto. Every lawyer in the country seems to want to take their
depositions." (The Safety Research Center is an impressive
glass and concrete building standing by itself about a mile from
Ford World

Headquarters in Dearborn. Looking at it, one imagines its large
staff protects consumers from burned and broken limbs. Not so.
The
Center is the technical support arm of Jack Echold's 14-person
anti-regulatory lobbying team in World Headquarters.)
When the Pinto liability suits began, Ford strategy was to go to
a jury. Confident it could hide the Pinto crash tests, Ford
thought that
juries of solid American registered voters would buy the
industry doctrine that drivers, not cars, cause accidents. It didn't
work. It seems
that juries are much quicker to see the truth than bureaucracies,
a fact that gives one confidence in democracy. Juries began
ruling against
the company, granting million-dollar awards to plaintiffs.
"We'll never go to a jury again," says Al Stechter in Ford's
Washington office. "Not in a fire case. Juries are just too
sentimental. They see
those charred remains and forget the evidence. No sir, we'll
settle."
9 of 11
Settlement involves less cash, smaller legal fees and less
publicity, but it is an indication of the weakness of their case.

Nevertheless, Ford
has been settling when it is clear that the company can't pin the
blame on the driver of the other car. But, since the company
carries $2
million deductible product-liability insurance, these settlements
have a direct impact on the bottom line. They must therefore be
considered a factor in determining the net operating profit on
the Pinto. It's impossible to get a straight answer from Ford on
the
profitability of the Pinto and the impact of lawsuit settlements
on it—even when you have a curious and mildly irate
shareholder call to
inquire, as we did. However, financial officer Charles Matthews
did admit that the company establishes a reserve for large dollar
settlements. He would not divulge the amount of the reserve and
had no explanation for its absence from the annual report.
Until recently, it was clear that, whatever the cost of these
settlements, it was not enough to seriously cut into the Pinto's
enormous
profits. The cost of retooling Pinto assembly lines and of
equipping each car with a safety gadget like that $5.08
Goodyear bladder was,
company accountants calculated, greater than that of paying out
millions to survivors like Robbie Carlton or to widows and
widowers of
victims like Sandra Gillespie. The bottom line ruled, and

inflammable Pintos kept rolling out of the factories.
In 1977, however, an incredibly sluggish government has at last
instituted Standard 301. Now Pintos will have to have rupture-
proof gas
tanks. Or will they?
To everyone's surprise, the 1977 Pinto recently passed a rear-
end crash test in Phoenix, Arizona, for NHTSA. The agency was
so
convinced the Pinto would fail that it was the first car tested.
Amazingly, it did not burst into flame.
"We have had so many Ford failures in the past," explained
agency engineer Tom Grubbs, "I felt sure the Pinto would fail."
How did it pass?
Remember that one-dollar, one-pound plastic baffle that was on
one of the three modified Pintos that passed the pre-production
crash
tests nearly ten years ago? Well, it is a standard feature on the
1977 Pinto. In the Phoenix test it protected the gas tank from
being
perforated by those four bolts on the differential housing.
We asked Grubbs if he noticed any other substantial alterations
in the rear-end structure of the car. "No," he replied, "the
[plastic baffle]
seems to be the only noticeable change over the 1976 model."

But was it? What Tom Grubbs and the Department of
Transportation didn't know when they tested the car was that it
was manufactured
in St. Thomas, Ontario. Ontario? The significance of that
becomes clear when you learn that Canada has for years had
extremely strict
rear-end collision standards.
Tom Irwin is the business manager of Charlie Rossi Ford, the
Scottsdale, Arizona, dealership that sold the Pinto to Tom
Grubbs. He
refused to explain why he was selling Fords made in Canada
when there is a huge Pinto assembly plant much closer by in
California. "I
know why you're asking that question, and I'm not going to
answer it," he blurted out. "You'll have to ask the company."
But Ford's regional office in Phoenix has "no explanation" for
the presence of Canadian cars in their local dealerships. Farther
up the line
in Dearborn, Ford people claim there is absolutely no difference
between American and Canadian Pintos. They say cars are
shipped back
and forth across the border as a matter of course. But they were
hard pressed to explain why some Canadian Pintos were shipped
all the
way to Scottsdale, Arizona. Significantly, one engineer at the
St. Thomas plant did admit that the existence of strict rear-end

collision
standards in Canada "might encourage us to pay a little more
attention to quality control on that part of the car."
The Department of Transportation is considering buying an
American Pinto and running the test again. For now, it will only
say that the
10 of 11
situation is under investigation.
Whether the new American Pinto fails or passes the test,
Standard 301 will never force the company to test or recall the
more than two
million pre-1977 Pintos still on the highway. Seventy or more
people will burn to death in those cars every year for many
years to come.
If the past is any indication, Ford will continue to accept the
deaths.
According to safety expert Byron Bloch, the older cars could
quite easily be retrofitted with gas tanks containing fuel cells.
"These
improved tanks would add at least 10 mph improved safety
performance to the rear end," he estimated, "but it would cost
Ford $20 to $30

a car, so they won't do it unless they are forced to." Dr. Kenneth
Saczalski, safety engineer with the Office of Naval Research in
Washington, agrees. "The Defense Department has developed
virtually fail-safe fuel systems and retrofitted them into existing
vehicles.
We have shown them to the auto industry and they have ignored
them."
Unfortunately, the Pinto is not an isolated case of corporate
malpractice in the auto industry. Neither is Ford a lone sinner.
There probably
isn't a car on the road without a safety hazard known to its
manufacturer. And though Ford may have the best auto
lobbyists in
Washington, it is not alone. The anti-emission control lobby and
the anti-safety lobby usually work in chorus form, presenting a
well-harmonized message from the country's richest industry,
spoken through the voices of individual companies—the Motor
Vehicle
Manufacturers Association, the Business Council and the U.S.
Chamber of Commerce.
Furthermore, cost-valuing human life is not used by Ford alone.
Ford was just the only company careless enough to let such an
embarrassing calculation slip into public records. The process
of willfully trading lives for profits is built into corporate
capitalism.

Commodore Vanderbilt publicly scorned George Westinghouse
and his "foolish" air brakes while people died by the hundreds
in
accidents on Vanderbilt's railroads.
The original draft of the Motor Vehicle Safety Act provided for
criminal sanction against a manufacturer who willfully placed
an unsafe
car on the market. Early in the proceedings the auto industry
lobbied the provision out of the bill. Since then, there have been
those
damage settlements, of course, but the only government
punishment meted out to auto companies for noncompliance to
standards has
been a minuscule fine, usually $5,000 to $10,000. One wonders
how long the Ford Motor Company would continue to market
lethal cars
were Henry Ford II and Lee Iacocca serving 20-year terms in
Leavenworth for consumer homicide.
Source URL:
http://www.motherjones.com/politics/1977/09/pinto-madness
Links:
[1] https://www.motherjones.com/politics/2009/06/collapse-
americas-imperial-car-industry
[2] http://www.motherjones.com/environment/2008/11/how-
ford-lost-focus
[3] http://www.motherjones.com/blue-marble/2008/07/whats-
most-polluting-car
[4]

http://www.motherjones.com/news/feature/1977/09/compress.m
ov
[5] https://www.motherjones.com/mojo/2009/04/bailout-
breakfast-gm-rolls-out-new-plan
[6] http://www.motherjones.com/politics/2008/09/how-fix-it-
get-nasa-back-mission
[7] http://www.motherjones.com/fix_sidebar.html
[8] http://www.motherjones.com/worth.html
[9] http://www.motherjones.com/death.html
11 of 11
Character is forged at those defining moments when a
manager must choose between right and right.
THE DISCIPLINE
OF BUILDING
CHARACTER
BY JOSEPH L. BADARACCO. JR.
W E HAVE ALL E X P E R I E N C E D , a tone time or
another, situations in
which our professional responsibilities
unexpectedly come into conflict with
our deepest values. A budget crisis

forces us to dismiss a loyal, hardwork-
ing employee. Our daughter has a piano
recital on the same afternoon that our
biggest client is scheduled to visit our
office. At these times, we are caught in a
conflict between right and right. And no
matter which option we choose, we feel
like we've come up short.
ARTWORK BY CRAIG FRAZIER 115
THE DISCIPLINE OF BUILDING CHARACTER
Managers respond to these situations in a variety
of ways; some impulsively "go with their gut";
others talk it over with their friends, colleagues, or
families; still others think hack to what a mentor
would do in similar circumstances. In every case,
regardless of what path is chosen, these decisions
taken cumulatively over many years form the very
basis of an individual's character. For that reason,
I call them defining moments.
What is the difference between a tough ethical
decision and a defining moment? An ethical deci-

To become leaders, managers need
to translate their personal values
into calculated action.
sion typically involves choosing hetween two op-
tions: one we know to be right and another we
know to he wrong. A defining moment, however,
challenges us in a deeper way by asking us to
choose between two or more ideals in which we
deeply helieve. Sueh challenges rarely have a "cor-
rect" response. Rather, they are situations created
hy circumstance that ask us to step forward and,
in the words of the American philosopher John
Dewey, "form, reveal, and test" ourselves. We form
our character in defining moments hecause we
commit to irreversihle courses of action that shape
our personal and professional identities. We reveal
something new ahout us to ourselves and others be-
cause defining moments uncover something that
had been hidden or crystallize something that had
been only partially known. And we test ourselves
because we discover whether we will live up to our
personal ideals or only pay them lip service.
As I have interviewed and studied business lead-
ers, I have found that the ones who are most satis-
fied with the way they resolve their defining mo-
ments possess skills that are left off most job
descriptions. Specifically, they are able to take time
out from the chain of managerial tasks that con-
sumes their time and undertake a process of proh-
ing self-inquiry-a process that is more often carried
out on the run rather than in quiet seclusion. They
Joseph I . Badaracco, Jr., is the fohn Shad Professor of
Business Ethics at the Harvard Business School in

Boston, Massachusetts. This article is based on his most
recent book. Defining Moments: When Managers Must
Choose Between Right and Right, published by the Har-
vard Business School Press in i991-
are able to dig below the busy surface of their daily
lives and refocus on their core values and princi-
ples. Once uncovered, those values and principles
renew their sense of purpose at work and act as a
springboard for shrewd, pragmatic, politically as-
tute action. By repeating this process again and
again throughout their work Uves, these executives
are able to craft an authentic and strong identity
based on their own, rather tban on someone else's,
understanding of what is right. And in this way,
they begin to make the transition from being a
manager to becoming a leader.
But how can an executive trained
in the practical, extroverted art of
management learn to engage in sucb
an intuitive, personal process of
introspection? In tbis article, I will
describe a series of down-to-earth
questions that will help managers
take time out from the hustle and
bustle of the workplace. Tbese practical, tbougbt-
provoking questions are designed to transform
values and beliefs into calculated action. Tbey have
been drawn from well-known classic and contem-
porary philosophers but remain profound and flex-
ible enough to embrace a wide range of contempo-
rary right-versus-right decisions. By taking time
out to engage in this process of self-inquiry, man-

agers will by no means be conducting a fruitless
exercise in escapism; ratber, they will be getting
a better handle on their most elusive, cballenging,
and essential business problems.
In today's workplace, three kinds of defining
moments are particularly eommon. Tbe first type
is largely an issue of personal identity. It raises the
question. Who am I? Tbe second type is organiza-
tional as well as personal: botb tbe character of
groups within an organization and the character
of an individual manager are at stake. It raises the
question. Who are we? The third type of defining
moment is the most complex and involves defining
a company's role in society. It raises the question.
Who is the eompany? By learning to identify each of
these three defining moments, managers will learn
to navigate rigbt-versus-right decisions with grace
and strengtb.
Who am I?
Defining Moments for Individuals
The most basie type of defining moment demands
that managers resolve an urgent issue of personal
identity that has serious implications for their ca-
reers. Two "rights" present themselves, each one
representing a plausible and usually attractive life
116 HARVARD BUSINESS REVIEW March-April 1998
choice. And therein lies the problem: there is no
one right answer; rigbt is set against right.

Conflicting Feelings. When caught in tbis bind,
managers can begin by taking a step back and look-
ing at the conflict not as a problem but as a natural
tension between two valid perspectives. To fiesh
out this tension, we can ask. What feelings and in-
tuitions are coming into conflict in this situation^
As Aristotle discussed in his classic
work Ethics, people's feelings ean actu-
ally help them make sense of an issue,
understand its hasie dimensions, and
indicate what the stakes really are. In
other words, our feelings and intuitions
are both a form of intelligence and a
source of insight.
Consider, for example, the case of a
young analyst-we will call him Steve
Lewis-who worked for a well-known
investment bank in Manhattan.' Early
one morning, Lewis, an African-Ameri-
can, found a message on his desk asking
if he could fly to St. Louis in two days to
help with a presentation to an impor-
tant prospeetive client. The message
came as a surprise to him. Lewis's eom-
pany had a clear policy against including
analysts in presentations or client meet-
ings. Lewis, in fact, knew little about
the subject of the St. Louis meeting,
which concerned a specialized area of
municipal finance. He was especially
surprised to learn that he had been se-
lected over more senior people in tbe
public finance group.

Lewis immediately walked down tbe
hall into the office of his friend and
mentor, also an African-American, and
asked him if he knew about the situa-
tion. His friend, a partner at the eom-
pany, replied, "Let me tell you what's
happening, Steve. Look at you and me.
What do we have in eommon? Did you
know that the new state treasurer of
Missouri is also black? I hate for you to be intro-
duced to tbis side of the business so soon, hut the
state treasurer wants to see at least one black pro-
fessional at the meeting or else the company has no
ehance of being named a manager for this deal."
What if at this point Lewis were to step back and
reframe tbe situation in terms of his feelings and
intuitions? On the one hand, Lewis believed firmly
that in order to maintain his self-respect, he had to
earn his advancement at the company - and else-
where in life. He was not satisfied to move up the
ladder of success based on affirmative action pro-
grams or being a "token" member of the company.
For that reason, he had always wanted to demon-
strate through his work that he deserved his posi-
tion. On the other hand, as a former athlete, Lewis
had always prided himself on being a team player
and did not believe in letting bis teammates down.
By examining his feelings and intuitions about the
To resolve their toughest business challenges, executives
need to refocus on their core values.
situation, Lewis learned that the issue at band was
more complex than whether or not to go to the pre-

sentation. It involved a conflict between two of his
most deeply held beliefs.
Deeply Rooted Values. By framing defining mo-
ments in terms of our feelings and intuitions, we
can remove the conflict from its business context
and bring it to a more personal, and manageable,
level. Then we can consider a second question to
help resolve the conflict: Which of the responsibili-
ties and values that are in conflict are most deeply
HARVARD BUSINESS REVIEW March-April 1998 117
rooted in my life and in the communities 1 care
aboutl Tracing the roots of our values means under-
standing their origins and evolution over time. It
involves an effort to understand which values and
commitments really mean the most to us.
Let's apply that approach to the ease of Steve
Lewis. On the one hand, he bad no doubt that he
wanted to hecome a partner at a major investment
bank and that he wanted to earn that position based
on merit. Since his sophomore year of college,
Lewis had been drawn to the idea of a career on Wall
Street, and he had worked hard and purposefully to
make that idea a reality. When be accepted his cur-
rent job, he had finally set foot on the path he had
dreamed of, and neither the long hours nor the
detailed "grunt" work that was the lot of first-year
analysts gave him misgivings about his choice. He
believed be was pursuing his own values by seeking

a successful career at a Wall Street investment
bank. It was the kind of life he wanted to live and
the kind of work he enjoyed doing.
On the other hand, when Lewis considered his
African-American background, be thought about
what his parents had taught him. One episode from
the early 1960s stood out in particular. His parents
made a reservation at a restaurant that reputedly
did not serve blacks. Wben they arrived, the hostess
told them there had been a mistake. Tbe reserva-
tion was lost, and they could not be seated. The
restaurant was half empty. Lewis's parents turned
around and left. When they got home, his mother
made a new reservation under her maiden name.
(His father had been a popular local athlete, whose
Self-inquiry must lead to shrewd,
persuasive, and self-coiilident
action if it is to be an effective tool.
name was widely recognized.) The restaurant sus-
pected nothing. When they returned an hour later,
the hostess, though hardly overjoyed, proceeded to
seat them.
Lewis was still moved by tbe memory of what his
parents had done, even as be sat in his office on
Wall Street many years later. Witb his parents' ex-
ample in mind, Lewis could begin to sense what
seemed to be tbe best answer to his present dilem-
ma. He would look at tbe situation as his parents'
son. He would view it as an African-American, not
as just another young investment hanker. Lewis
decided that he could not go to the meeting as the

"token black." To do so would repudiate his par-
ents' example. He decided, in effect, that his race
was a vital part of his moral identity, one with a
deeper and stronger relation to his core self than the
professional role he had recently assumed.
Shrewdness and Expediency. Introspection of
the kind Steve Lewis engaged in can easily beeome
divorced from real-world demands. We have all seen
managers who unthinkingly throw themselves into
a deeply felt personal cause and suffer serious per-
sonal and career setbacks. As the Renaissance
philosopher Niccolo Maehiavelli and other ethical
pragmatists remind us, idealism untempered by re-
alism often does little to improve the world. Hence,
the next critical question becomes. What combina-
tion of shrev/dness and expediency, coupled with
imagination and boldness, will help me implement
my personal understanding of what is rights This is,
of course, a different question altogether from What
should I do? It acknowledges that tbe business
world is a bottom-line, rough-and-tumble arena
wbere introspection alone won't get the job done.
Tbe process of looking inward must culminate in
concrete action characterized by tenacity, persua-
siveness, shrewdness, and self-confidence.
How did Lewis combine idealism witb realism?
He decided tbat be would join tbe presentation
team, but be also gambled that he could do so on
terms that were at least acceptable to him. He told
tbe partner in charge, Bruce Anderson, that he felt
honored to be asked to participate but added tbat be
wanted to play a role in the presentation. He said he
was willing to spend every minute of the next 30

hours in preparation. When Ander-
son asked why, Lewis said only that
be wanted to earn his place on the
team. Anderson reluctantly agreed.
There was, it turned out, a minor ele-
ment of the presentation that re-
quired the application of some basic
analytical teehniques with which
Lewis was familiar. Lewis worked
hard on the presentation, but when he stood up dur-
ing tbe meeting for the 12 minutes allotted him, he
had a terrible headache and wished he had refused
Anderson's offer. His single day of cramming was
no substitute for tbe weeks his colleagues had in-
vested in the project. Nevertheless, his portion of
the presentation went well, and he received praise
from his colleagues for the work he had done.
On balance, Lewis had soundly defined the
dilemma he faced and bad taken an active role in
solving it-he did not attend the meeting as a show-
piece. At the same time, be may have strengthened
his career prospects. He felt he had passed a minor
A GUIDE TO DEFINING MOMENTS
FOR INDIVIDUALS
Who am I?

LWhat feelings and intuitions
are coming into conflict in
this situation?
2. Which of the values that are
in conflict are most deeply
rooted in my life?
3. What combination of expedi-
ency and shrewdness, coupled
with imagination and bold-
ness, will help me implement
my personal understanding of
what is right?
FOR MANAGERS OF
WORK GROUPS
Who are we?
1. What are the other strong, per-
suasive interpretations of the
ethics of this situation?
2. What point of view is most
likely to win a contest of in-
terpretations inside my orga-
nization and influence the
thinking of other people?
3. Have I orchestrated a process
that can make manifest the
values I care about in my orga-
nization?

FOR COMPANY
EXECUTIVES
Who is the company?
1. Have I done all I can to secure
my position and the strength
of my organization?
2. Have I thought creatively and
boldly about my organiza-
tion's role in society and its re-
lationship to stockholders?
3. What combination of shrewd-
ness, creativity, and tenacity
will help me transform my
vision into a reality?
test, a rite of passage at his company, and had
demonstrated not only that he was willing to do
what it took to get the job done hut also that he
would not he treated as a token memher of the
group. The white analysts and associates who were
passed over prohably grumbled a hit; but Lewis sus-
pected that, if they had been dealt his hand, they
would have played their cards as he did.
Who Are We?
Defining Moments for Work Groups
As managers move up in an organization, defining
moments beeome more difficult to resolve. In addi-
tion to looking at the situation as a conflict be-
tween two personal beliefs, managers must add
another dimension; the values of their work group

and their responsibilities to the people they man-
age. How, for example, should a manager respond to
an employee who repeatedly shows up for work
with the smell of alcohol on his breath? How
should a manager respond to one employee who has
made sexually suggestive remarks to another? In
this type of defining moment, the problem and its
resolution unfold not only as a personal drama
within one's self but also as a drama among a group
of people who work together. The issue becomes
public and is important enough to define a group's
future and shape its values.
Points of View. Many managers suffer from a
kind of ethical myopia, believing that their entire
group views a situation through the same lens
that they do. This way of thinking rarely succeeds
in bringing people together to accomplish eom-
mon goals. Differences in upbringing, religion,
ethnicity, and education make it difficult for any
two people to view a situation similarly-let alone
an entire group of people. The ethieal challenge
for a manager is not to impose his or her under-
standing of what is right on the group hut to un-
derstand how other members view the dilemma.
The manager must ask. What are the other
strong, persuasive interpretations of the ethics of
this situation^
A classic example of this kind of prohlem in-
volved a 3 5-year-old manager, Peter Adario. Adario
headed the marketing department of Sayer Micro-
world, a distributor of computer products. He was
married and had three children. He had spent most
of his career as a successful salesman and branch
manager, and he eagerly accepted his present posi-

tion beeause of its varied challenges. Three senior
managers reporting to Adario supervised the other
50 employees in the marketing department, and
Adario in turn reported to one of four vice presi-
dents at corporate headquarters.
Adario had recently hired an account manager,
Kathryn McNeil, who was a single mother. Al-
though she was highly qualified and competent,
McNeil was having a hard time keeping up with her
work because of the time she needed to spend with
her son. The pace at work was demanding: the com-
pany was in the middle of finishing a merger, and
6o-hoiir work weeks had become the norm. McNeil
was also having difficulty getting along with her su-
pervisor. Lisa Walters, a midlevel manager in the
department who reported to Adario. Walters was an
ambitious, hard-driving woman who was excelling
in Sayer Microworld's fast-paced environment. She
Managers need to determine if
their ethical vision will be
supported by their coworkers
and employees.
was irritated by McNeil's chronic lateness and
unpredictable work schedule. Adario had not paid
much attention to Walters' concerns until the
morning he found a handwritten note from her on

top of his pile of unfinished paperwork. It was her
seeond note to him in as many weeks. Both notes
complained about McNeil's hours and requested
that she be fired.
For Adario, who was himself a father and sympa-
thetic to McNeil's plight, the situation was clearly
a defining moment, pitting his belief that his em-
ployees needed time with their families against
his duty to the department's bottom line. Adario
decided to set up a meeting. He was confident that
if he sat down with the two women the issue could
somehow be resolved. Shortly before the meeting
was to begin, however, Adario was stunned to learn
that Walters had gone over his head and discussed
the issue with one of the company's senior execu-
tives. The two then had gone to McNeil's office and
had fired her. A colleague later told him that Mc-
Neil had been given four hours to pack her things
and leave the premises.
Where Adario saw right versus right, Walters saw
right versus wrong. She believed that the hasic ethi-
cal issue was McNeil's irresponsibility in not
pulling her weight and Adario's lack of action on
the issue. McNeil's customer account was crucial,
and it was falling behind schedule during a period
of near-crisis at the company. Walters also believed
that it was unfair for one member of the badly over-
burdened team to receive special treatment. In
retrospect, Adario could see that he and Walters
looked at the same facts about McNeil and reached
very different conclusions. Had he recognized ear-
lier that his view was just one interpretation among
many, he might have realized that he was engaged

in a diffieult contest of interpretations.
Influencing Behavior. Identifying competing in-
terpretations, of course, is only part of the battle.
Managers also need to take a hard look at the orga-
nization in whieh they work and make a realistic
assessment of whose interpretation will win out in
the end. A number of factors can determine which
interpretation will prevail: company
culture, group norms, corporate
goals and company policy, and the
inevitable political jockeying and
battling inside organizations. In the
words of the American philosopher
William James, "The final victorious
way of looking at things will be the
most completely impressive to the
normal run of minds." Therefore,
managers need to ask themselves.
What point of view is most likely to win the con-
test of interpretations and influence the thinking
and behavior of other people^
Peter Adario would have benefited from mulling
over this question. If he had done so, he might have
seen the issue in terms of a larger work-family issue
within the company. For Adario and McNeil, the
demands of work and family meant constant fa-
tigue, a sense of being pulled in a thousand direc-
tions, and the frustration of never catching up on all
they had to do. To the other employees at Sayer
Microworld, most of whom were young and not yet
parents, the work-family conflict meant that they
sometimes had to work longer hours because other

employees had families to attend to. Given the
heavy workloads they were carrying, these single
employees had little sympathy for Adario's family-
oriented values.
Truth as Process. Planning ahead Is at the heart of
managerial work. One needs to learn to spot prob-
lems before they blow up into crises. The same is
true for defining moments in groups. They should
be seen as part of a larger process that, like any oth-
er, needs to he managed. Effective managers put
into place the eonditions for the successful resolu-
tion of defining moments long before those mo-
ments actually present themselves. For in the
words of William James, "The truth of an idea is not
a stagnant property inherent in it. Truth happens to
an idea. It becomes true, is made true by events. Its
verity is in fact an event, a process." Managers can
start creating the conditions for a particular inter-
pretation to prevail by asking. Have 1 orchestrated
' I;
a process that can make my interpretation vidn in
my groups
Adario missed subtle signals that a process op-
posed to his own had been under way for some
time. Recall that Walters had sent Adario two
notes, each suggesting that McNeil be replaced.

What were those notes actually ahout? Were they
tentative announcements of Walters's plans or tests
of Adario's authority? And what did
Walters make of Adario's failure to re-
spond? She apparently interpreted his
reaction-or lack thereof-as an indica-
tion that he would not stand in the way
of firing McNeil. Walters may even have
thought that Adario wanted McNeil
fired but was unwilling to do it himself.
In short, Adario's defining moment had
gone badly because Walters presented a
compelling story to the company's top
management; she thereby preempted
Adario and filled the vacuum that he
had created through his inaction.
Instead of waiting for the issue of
work versus family to arise and take the
group by surprise, Adario could have an-
ticipated the problem and taken a proac-
tive approaeh to defining a work culture
that valued both family and work.
Adario had ample opportunity to pre-
vent the final turn of events from occur-
ring. He could have promoted McNeil to
others inside the company. In particu-
lar, he needed to emphasize the skills
and experienee, espeeially in account
management, that she brought to the
company. He also could have created
opportunities for people to get to know
McNeil personally, even to meet her
son, so that they would understand and
appreciate what she was accomplishing.

Playing to Win. One of the hallmarks
of a defining moment is that there is
a lot at stake for all the players in the
drama. More often than not, the players
will put their own interests first. In this type of
business setting, neither the most well-meaning
intentions nor the best-designed process will get
the job done. Managers must be ready to roll up
their sleeves and dive into the organizational fray,
putting to use appropriate and effective tactics that
will make their vision a reality. They need to reflect
on the question. Am 1 just playing along or am I
playing to win ̂
At Sayer Microworld, the contest of interpreta-
tions between Walters and Adario was clearly part
of a larger power struggle. If Walters didn't have her
eye on Adario's job before McNeil was fired, she
probably did afterward: top management seemed to
like her take-charge style. Whereas Adario was loh-
bing underhand softball pitches, Walters was play-
ing hardball. At Sayer Microworld, do-the-right-
thing idealism without organizational savvy was
the sure path to obscurity. Adario's heart was in the
Some of the most challenging defining moments faced by
managers ask them to balance work and family.
right place wben he hired McNeil. He believed she
eould do the job, he admired her courage, and he
wanted to create a workplace in which she eould
fiourish. But his praiseworthy intentions needed to
be backed by a knack for maneuvering, shrewdness,
and political savvy. Instead, Walters seized the mo-
ment. She timed her moves carefully and found a

powerful ally in the senior manager who helped her
carry out her plan.
Although Adario stumbled, it is worth noting
that this defining moment taught him a great deal.
HARVARD BUSINESS REVIEW March-April 1998 IZl
In following up on McNeil's firing, Adario learned
through the grapevine that many other employees
shared his view of the work-family dilemma, and
he began acting with more confidence than he had
before. He told his hoss that he disagreed with the
decision to fire McNeil and objected strongly to the
way the decision had heen made. He then told Wal-
ters that her behavior would be noted in the next
performance review he put in her file. Neither Wal-
ters nor the viee president said very much in re-
sponse, and the issue never came up again. Adario
had staked his claim, alheit belatedly. He had
learned, in the words of Maehiavelli, that "a man
who has no position in soeiety cannot even get a
dog to bark at him."
Who Is the Company?
Defining Moments for Executives
Redefining the direction of one's own life and the
direction of one's work group requires a thoughtful
blend of personal introspection and calculated ac-
tion. But the men and women charged with running
entire companies sometimes face an even more

complex type of defining moment. They are asked
to make manifest their understanding of what is
right on a large stage - one that can include labor
unions, the media, shareholders, and many other
company stakeholders. Consider the complexity of
the dilemma faced by a CEO who has just received a
report of package tampering in one of the compa-
ny's over-the-eounter medications. Or consider the
position of an executive who needs to formulate a
response to reports in the media that women and
children are heing treated unfairly in the company's
To succeed, top-level executives
must negotiate their ethical vision
with shareholders, customers,
and employees.
foreign plant. These types of decisions force top-
level managers to commit not just themselves or
their work groups but their entire company to an
irreversible course of action.
Personal and Organizational Strength. In the face
of such overwhelming decisions, executives typi-
cally call meetings, start negotiations, and hire con-
sultants and lawyers. Although these steps can be
helpful, they can prove disappointing unless execu-
tives have taken the time, and the necessary steps,
to carve out a powerful position for themselves in
the dehate. From a position of strength, leaders can
bring forth their vision of what is right in a situa-
tion; from a position of weakness, leaders' actions
are hollow and desperate. Also, before CEOs can
step forth onto society's broad stage with a personal
vision, they must make sure that their actions will

not jeopardize the well-being of their companies,
the jobs of employees, and the net income of share-
holders. That means asking. Have 1 done all I can
to secure my position and the strength and stabil-
ity of my organization I
In 1988, Eduoard Sakiz, CEO of Roussel Uclaf, a
French pharmaceutical company, faced a defining
moment of this magnitude. Sakiz had to decide
whether to market the new drug RU-486, which
later came to be known as the French ahortion pill.
Early tests had shown that the drug was 90% to
95% effective in inducing miscarriages during the
first five weeks of a woman's pregnancy. As he con-
sidered whether to introduce the drug, Sakiz found
himself embroiled in a major international contro-
versy. Antiabortion groups were outraged that the
drug was even under consideration. Pro-choice
groups believed the drug represented a major step
forward in the battle to secure a woman's right to an
abortion. Shareholders of Roussel Uclaf's parent
company, Hoechst, were for the most part opposed
to RU-486's introduction because there had heen
serious threats of a major boycott against Hoechst if
the drug were introduced. To the French govern-
ment, also a part owner of Roussel Uclaf, RU-486
meant a step forward in its attempts to cut hack on
back-alley ahortions.
There is little doubt that at one
level, the decision Sakiz faced was a
personal defining moment. He was
a physician with a long-standing
commitment to RU-486. Earlier in
his career while working as a med-
ical researcher, Sakiz had helped

develop the chemical compound
that the drug was based on. He be-
lieved strongly that the drug could
help thousands of women, particu-
larly those in poor countries, avoid injury or death
from botehed abortions. Because he douhted that
the drug would make it to market if he were not
running the company, Sakiz knew he would have to
secure his own position.
At another level, Sakiz had a responsibility to
proteet tbe jobs and security of his employees. He
understood this to mean taking whatever steps he
could to avoid painful boycotts and the risk of vio-
From Vision to Reality. To make their ethical
visions a reality, top-level executives must assess
their opponents and allies very carefully. What
allies do I have inside and outside my company?
Which parties will resist or fight my efforts? Have
I underestimated their power and tactical skill or
overestimated their ethical commitment? Whom
will I alienate with my decision? Which parties will
retaliate and how? These tactical concerns can be
Astute executives can use
defining moments as an
lence against the company. His decision was com-

plicated by the fact that some employees were pas-
sionately committed to RU-486, whereas others op-
posed the drug on ethical grounds or feared that the
protests and boycotts would harm Roussel Uclaf
and its other products.
How could Sakiz protect his own interests and
those of his employees and still introduce the drug?
Whatever path he chose, he could see that he would
have to assume a low puhlie profile.
It would be foolish to play the coura-
geous lion and charge forth pro-
nouncing the moral necessity of
RU-486. There were simply too many
opponents for that approach to work.
It could cost him his job and drag the o p D o r t u n i t v t o T e
d e f i n c t h e i r
company through a lengthy, painful ^ ^ ^ ^
process of dangerous turmoil companv s role ill sodetv.
The Role of the Organization in -"̂ ^ -̂
Society. What makes this third type
of defining moment so difficult is that executives
are asked to form, reveal, and test not only them-
selves and their work groups but also their entire
company and its role in society. That requires forg-
ing a plan of action that functions at three levels:
the individual, the work group, and society at large.
In whieh areas do we want to lead? In wbieh areas
do we want to follow? How should we interact with
the government? With shareholders? Leaders must
ask themselves. Have 1 thought creatively, boldly,
and imaginatively ahout my organization's role in
society and its relationship to its stakeholders}

What role did Sakiz want Roussel Uclaf to play?
He certainly did not want to take the easy way out.
Sakiz could have pleased his boss in Germany and
avoided years of controversy and boycotts by with-
drawing entirely from the market for contracep-
tives and other reproductive drugs. (Nearly all U.S.
drug companies have adopted that approach.) Sakiz
could have defined Roussel Uclaf's social role in
standard terms-as the property of its shareholders-
and argued that RU-486 had to be shelved because
boycotts against Roussel Uclaf and Hoechst were
likely to cost far more than the drug would earn.
Instead, Sakiz wanted to define Roussel Uclaf's
role in a daring way: women seeking nonsurgical
abortions and their physicians would be among the
company's core stakeholders, and the company
would support this constituency through astute
political activism. That approach resonated with
Sakiz's own core values and with what he thought
the majority of employees and other stakeholders
wanted. It was clear to him that he needed to find a
way to introduce the drug onto the market. The
only question was how.
summed up in the question. What combination of
shrewdness, creativity, and tenacity will make
my vision a reality^ Maehiavelli put it more suc-
cinctly: "Should I play the lion or the fox?"
Although we may never know exactly what went
through Sakiz's mind, we can infer from his aetions
that he had no interest in playing the lion. On Octo-
ber 21, 1988, a month after the French government
approved RU-486, Sakiz and the executive commit-

tee of Roussel Uclaf made their decision. The New
York Times described the events in this way: "At an
October 21 meeting, Sakiz surprised members of
the management committee by calling for a discus-
sion of RU-486. There, in Roussel Uclaf's ultra-
modern boardroom, the pill's long-standing oppo-
nents repeated their ohjections: RU-486 could
spark a painful boycott, it was hurting employee
morale, management was devoting too much of its
time to this controversy. Finally, it would never be
hugely profitable because much would be sold on
a cost basis to the Third World. After two hours,
Sakiz again stunned the committee by calling for a
vote. When he raised his own hand in favor of sus-
pending distribution of RU-486, it was clear that
the pill was doomed."
The company informed its employees of the deci-
sion on October 25- The next day, Roussel Uclaf
announced publicly that it was suspending distri-
bution of the drug because of pressure from anti-
abortion groups. A Roussel Uclaf official explained
the deeision: "The pressure groups in the United
States are very powerful, mayhe even more so than
in France."
The company's decision and Sakiz's role in it
sparked astonishment and anger. The eompany and
its leadership, critics charged, had doomed a

promising public-health tool and had set an ex-
ample of cowardice. Sakiz's colleague and friend,
Etiennc-Emile Baluieu, whose research had been
crucial to developing RU-486, called the decision
"morally scandalous" and accused Sakiz of caving
in to pressure. Women's groups, family-planning
advocates, and physicians in the United States and
Europe came down hard on Sakiz's decision. Other
critics suggested sarcastically that the company's
deeision was no surprise because Roussel Uclaf had
decided not to produce contraceptive pills in the
face of controversy during the r96os.
Three days after Roussel Uclaf announced that it
would suspend distrihution, the French minister of
health summoned the company's vice chairman to
his office and said that if the company did not re-
sume distribution, the government would transfer
the patent to another company that would. After
the meeting with the minister of health, Roussel
Uclaf again stunned the public: it announced the
reversal of its initial decision. The eompany would
distribute RU-486 after all.
Sakiz had achieved his goals but in a foxlike man-
ner. He had called out to his allies and rallied them
to his side, but had done so in an indirect and
shrewd way. He had used the predictable responses
Defining moments force us to
find a balance between our hearts
in aU their idealism and our jobs in
aU their messy reality.
of the many stakeholders to orchestrate a series of
events that helped achieve his ends, without look-

ing like he was leading the way. In fact, it appeared
as if he were giving in to outside pressure.
Sakiz had put into place the three principal com-
ponents of the third type of defining moment. First,
he had secured his own future at the company. The
French health ministry, which supported Sakiz,
might well have been aggravated if Hoechst had ap-
pointed another CEO in Sakiz's place; it could then
have retaliated against the German company in a
number of ways. In addition, by having the French
government participate in the decision, Sakiz was
able to deflect some of the controversy about intro-
ducing the drug away from the company, protecting
employees and the bottom line. Finally, Sakiz had
put Roussel Uclaf in a role of technological and so-
cial leadership within French, and even interna-
tional, circles.
A Bow with Great Tension
As we have moved from Steve Lewis to Peter
Adario to Eduoard Sakiz, we have progressed
through increasingly complex, but similar, chal-
lenges. These managers engaged in difficult acts of
self-inquiry that led them to take calculated action
hased on their personal understanding of what was
right in the given situation.
But the three met with varying degrees of suc-
cess. Steve Lewis was ahle to balance his personal
values and the realities of the business world. The
result was ethically informed action that advanced
his career. Peter Adario had a sound understanding
of his personal values hut failed to adapt them to

the realities he faced in the competitive work envi-
ronment at Sayer Microworld. As a result, he failed
to prevent McNeil's firing and put his own career in
peril. Eduoard Sakiz not only stayed closely con-
nected to his personal values and
those of bis organization but also
predicted what his opponents and
allies outside the company would
do. The result was the introduction
of a drug that shook the world.
The nineteenth-century German
philosopher Friedrich Nietzsche
once wrote, "I believe it is precisely
through the presence of opposites
and the feelings they occasion that
the great man-the bow with great tension-devel-
ops." Defining moments bring those "opposites"
and "feelings" together into vivid focus. They foree
us to find a balance between our hearts in all tbeir
idealism and our jobs in all their messy reality.
Defining moments then are not merely intelleetual
exercises; they are opportunities for inspired action
and personal growth.
1. The names in the accounts of Steve Lewis and Peter Adario
have heen
changed to protect the privacy of the principals involved.
Reprint 98201 To order reprints, see the last page of this issue.

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