Texaco Case Study

Highly qualified African-American employees filed a class action suit against Texaco in 1994, stating that the company failed to promote African-American employees to a higher position and it failed to compensate them in relation to Caucasian employees in similar positions.

Throughout the investigation of Texaco if was found that documents would potentially damage Texaco were being withheld. When secret tape recordings from Texaco executives revealed not only vilely insensitive racial attitudes but it also demonstrated the eagerness of the executives to withhold any and all sensitive internal documents pertaining to the discrimination court case.

Discrimination throughout Texaco was a big problem. Texaco’s problems were not just with the lower-level employees, but also with the other levels of management. Comments from Caucasian managers were “I never thought I’d see the day when a black woman had an office at Texaco” (Trevino, 2004). Being called uppity and a “smart-mouthed little colored girl” (Roberts, 1996) were only some of the comments made by the Caucasian employees.

The company’s problems got worse when a former senior financial analyst wrote a book speaking about the humiliating experiences that minorities faced while at Texaco, this would also include him. These problems continued because the minorities at Texaco were scared to speak up for themselves at the time. When minority employees would file a grievance they would not be addressed and no one would follow through.

Management and other employees were scared that their jobs would be given to the minorities and that minorities would have more control than they did. (RW Online, 2004. Texaco: Case Study of Corporate Racism para5). The persons responsible for investigating and reprimanding those who were discriminating never took action against those committing these actions leaving those that were discriminated against feeling powerless in their fight to correct this behavior.

Many of the minority employees felt that issues were not being addressed. This made them feels insecure at their job and helpless. It had become apparent to many that going to management were not going to help alleviatethe problem. The total number of people who were discriminated against may never be known, but through the bravery of the few, the prejudice of that behavior has been stopped and has been corrected.

Texaco later implemented a solution for its problems but many thought it was not enough. Rev. Jesse Jackson, in 1996 “urged patrons to carry on with an economic boycott of the oil company” he suggested the boycott would add pressure to Texaco and that they would be pressed in implementing better employment policies for minorities and that these policies would be enforced. (CNN News, 1996). Roles of Key Players

The employees of Texaco at the time obviously were the ones affected by this discrimination. Peter Bijur, the CEO of Texaco and the key person for the changes that took place in the company, was a key player in this case in the months leading up to the settlement. Other key players for the changes at Texaco were Bari-Ellen Roberts, a former senior financial analyst and Angela Vallot, the Director of the corporate diversity initiatives, who was responsible for the restructuring of the organization’s diversity plan.

Richard Lundwell, senior coordinator of personnel services in Texaco’s finance department who gave the tapes to the plaintiff’s lawyers in the discrimination suit, lost his job in August as part of job cuts by Texaco. Ulrich retired in March 1995. Identification of Root Problems and Unresolved Issues

The executives of Texaco had to admit and take responsibility for the faults and behavior of the organization. The most obvious thing for Texaco was to induce and commit to an overwhelming change. Mr. Bijur had to make it clear that he would simply not tolerate disrespect and that those who didn’t go along with the culture change would be dismissed. The inclusion of women and minorities in the human resources committee would be a major step in enforcing new corporate diversity plans.

Changing the culture through various programs must have been shocking yet necessary for all of the minority employees. Establishing formal mentoring and leadership development programs to ensure that the company was preparing minorities for leadership positions displayed managerial competence. (Trevino & Nelson, 2004) After settling, the CEO was having a conscience about diversity and its importance to a successful organization. To progress the old culture with changes would take many years.

The company had to pay attention to how individuals think, then how will discrimination views or diversity training make a difference. Texaco had to embrace the changes that were necessary and implement a complete culture change, and put in place new employee policies in their manuals. Texaco could implement changes that alleviated the immediate concerns, which were the discrimination and prejudice, lack of follow through on the reported discrimination, the lack of equal wages and equal opportunities for advancement, and finally the white male majority in leadership roles.

The changes needed to complete a metamorphosis like the one Texaco has gone through will take realistic short-term and long-term goals. The cultural change needed in Texaco should start at upper levels of management and ethical values have to be re-examined for today’s society. While Texaco has since merged with Chevron, the organizations committed to uphold the high standards and practices it set for itself. Only time will tell if the organization will maintain the changes for long-term and cultural change.

ReferencesChevron Corporation. (2006). 2005 Corporate Responsibilities Report. Retrieved September 30, 2006 fromwww.chevron.com/cr_report/2005/priorities_progress_plans/integration/business_ethics

CNN News 1996 Cable News Network, Inc. Jackson: Keep pressure on Texaco until culture changes 1-4. Retrieved September 30, 2006 form www.cnn.com/US/9611/17/texaco

Texaco: Case Study of Corporate Racism. (1996). Revolutionary Worker #883. Retrieved September 30, 2006 from www.rwor.org/a/firstvol/883/texaco.htm