Texas Gulf Sulphur: The Timmins Ontario Mine Harvard Case Solution & Analysis

EVALUATION:

The first problem underlying the expansion of ore was about the spreading of rumor along with untimely and inaccurately flowing of information that the company tried to keep confidential. Actually, the problem initiated when rumors about “a major strike is in the making” started to arise in the Canada, firstly through press releases as in the “The New York herald tribune” and “The New York Times” from the unauthenticated source about the process of drilling. These issues were later taken into consideration by President Stephen and then he ordered his Executive Vice President Fogarty and his Attorney Huntington to keep this information of drilling process confidential and it should not be known even to the employees, officers and directors of Texas Gulf Sulphur other than those who were a part of the exploration. Moreover, Texas Gulf Sulphur arranged a press release to clarify the things in which Fogarty clearly stated that the rumors about the expansion of Texas Gulf Sulphur were not authenticated as they were flowing just by words of mouth and it was also stated that the process up till then was not sufficient enough to make statements about it and if any such drilling process would be successful then Texas Gulf Sulphur would inform all of its stakeholders and the general public in an official manner.

Secondly, the problem arose when one of the Canadian Journalist visited the site of drilling and then reported that information in the press release about the wrong quantity of the extraction. Later on, this information was reported to the Ontario Minister of mines for further release to the Media of Canada. Again this issue was taken into consideration by the President of Texas Gulf Sulphur, Stephen. Further, to maintain the reputation of the company, Stephen officially informed the extraction of at least 25 million tons of ore through a detailed statement, which later reached to the representatives of American financial media and to the others as well.

Thirdly, the main and uncontrollable issue that caused the company to lose the confidentiality about its extraction and drilling process was the behavior of its employees, officers and directors that was so optimistic towards the company. However, as they all were linked to the company and they knew well about the future aspects of the company; therefore, their behavior towards more acquisition of shares and options of Texas Gulf Sulphur was again an assessing indicator for others about the company’s expansion of ore grading as even those employees who had only small holdings of company’s shares of stock and no holdings of stock options were also increasing their holdings and were acquiring stock options. Again to simplify this issue, President Stephen decided to announce the inside information publicly with an untimely release of information by a Canadian Journalist.

RECOMMENDATIONS:

After analysis of the complete case of the Texas Gulf Sulphur some recommendations that might be useful for the company include the following:

  1. The Texas Gulf Sulphur should take a legal permission from the state and should make an official announcement that a company would be in the process of expanding its ore grading soon, before starting the drilling process. This should be done so that it could prevent its company from being the hunt of public rumors as well as press releases and could continue its process without any interruption of media and fear of any state actions and could solely focus on its core operations.
  2. The company should continue to be in contact with public announcements, press meetings and press releases so as to make the public aware about the accurate information related to the status of extraction process at the right intervals of time so that any wrong predictions related to the quantity of extraction can be prevented.
  3. The company should also inform all the other employees, officers and directors whether they would be a member of the extraction group or not, so that they feel that they are an important asset of the company and could commit themselves to control such rumors and flow of wrong information from their own side.
  4. The company should also be in connection with any legal body so that in case any misleading blame is used to worsen the company’s reputation, then the state could itself take a legal action and could prevent the Texas Gulf Sulphur company from being attacked by wrong acts of competitors.
  5. These continuous announcements of the company about the extraction of its ore grading might not only help in preventing rumors and wrong press releases but it may be considered as an offensive act for the company and show its strong position to inform its competitors and prevent them from committing any wrong deed towards the company......................................

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