Lessons from Industrial Espionage: The Costly Consequences of Employee Resentment
The Gillette Company – Mach 3 triple-blade razor case (1997)
In 1997, The Gillette Company faced a significant threat when top-secret design plans for its groundbreaking Mach 3 triple-blade razor were stolen. The company had invested a staggering $750 million in its development, and the success of this innovation was crucial for its survival.
The perpetrator behind this act was Steven L. Davis, a process controls engineer at Wright Industries Inc., a subcontractor for Gillette. Davis had been demoted to a lower role in the project, and he harboured deep resentment towards both Wright and Gillette. Fueled by this bitterness, he took unlawful measures to disclose extensive trade secrets related to the Mach 3 to Gillette’s main competitors, including American Safety Razor Co., Bic, and Warner-Lambert Co. (owner of Schick-Wilkinson Sword). This not only violated the Economic Espionage Act of 1996 but also jeopardized Gillette’s future. Davis sought revenge against the company that he believed had wronged him.
Pivotal action in resolving the situation
Fortunately, Schick-Wilkinson Sword promptly reported the illicit activities to Gillette, leading to the involvement of the local FBI office. Rick Deslauriers, then with the FBI’s Counterintelligence Division, became involved in the case. Through thorough investigation, the culprit was identified and apprehended. It’s important to note that Schick’s responsible action played a pivotal role in resolving the situation.
Ultimately, Davis was convicted and sentenced to 27 months in prison. Despite potentially facing a much longer sentence, his motive was taken into account. His actions were not driven by financial gain, and none of Gillette’s trade secrets were ultimately lost to its competitors.
Treating employees with respect and fairness
This case underscores the importance of treating employees with respect and fairness, as resentment and dissatisfaction can lead to detrimental consequences for both individuals and organizations. Demoting an employee without due consideration can have severe repercussions, as demonstrated by the drastic measures taken by Davis.
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