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ISS

ISS is a Danish-based company, being one of the largest suppliers of cleaning, catering and security services in the world. In an industry where low pay and high labour turnover are the norm ISS tries to offer its employees the best possible terms and conditions of employment. It encourages trade union membership, invests heavily in training and encourages staff to take an interest in the business to which they are contracted. Probably as a result, labour turnover is low and productivity is high. In an industry where price competition based on low wages is the norm, ISS has a policy of competing on quality.

ISS won a high value, high prestige, contract to provide cleaning services at Heathrow Airport, Terminal One in 1993. There had been a history at the Terminal of poor quality service from previous contractors but, once ISS had worked into the contract there was a significant increase in customer satisfaction over cleanliness. ISS trained its staff also to provide passenger directions and generally to be helpful and constructive.

The manager responsible for awarding the contract appeared on television extolling the virtues of ISS and indicating that the policy of awarding contracts to the lowest bidder was now at an end. In future, he claimed, quality would be the determining factor.

Very shortly afterwards the contract came up for renewal and ISS lost it to a lower bid involving wage levels some 30% below that which ISS were paying.

Is ISS's policy good ethics or bad business? Would staff be better off with lower pay but in

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