Business And Ethics Essay

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Business and Ethics

UNIVERSITY OF LA VERNE

VAFB, CALIFORNIA

ECBU 346

BUSINESS COMMUNICATION

FEBURARY 12, 1997

BY DOUG RONING

From a business perspective, working under government contracts can be

very lucrative. In general, a steady stream of orders keep coming in, revenue

increases and the company continues to grow. There are a few obvious downfalls

to working with government contracts; a higher quality is to be expected as well

as extensive research accompanied by accurate and complete documentation are

usually required. If one part of the process fails to perform correctly it can

cause minor flaws as well a problems that can carry some serious repercussions;

For example the case of the failed computer chip at Company X. When both the

employee and company are found at fault, the question arises of how extensive

should the repercussions be? Is the company as a whole liable or do you look

into individual employees within that company? From an ethical perspective one

would have to look at the available information of both the employees and their

superiors along with the role of others in the situation. Next you would have

to analyze the final outcome from a corporate perspective and then examine the

corporate responsibility as a whole in order to find a resolution for cases such

as this.

The first mitigating factor involved in the Company X case is the

uncertainty, on the part of the employees, on their duties that they were

assigned. It is possible that during the testing procedure, an employee

couldn't distinguish between the parts they were to test under government

standards and commercial standards. In some cases they might have even been

misinformed on the final product that they tested. In fact, ignorance on the

part of the employees would fully excuse them from any moral responsibility for

any damage that may result from their work. Whether it is decided that an

employee is fully excused, or is given some moral responsibility, would have to

be looked at on an individual basis.

The second mitigating factor is one of threats that an employee might

suffer if they do not follow through with their assignment. After the bogus

testing was completed in the Company X labs, the documentation department also

had to falsify documents stating that the parts had more than met the

governments testing standards. From a legal and ethical standpoint, both the

testers and the writers of the reports were merely acting as agents on direct

orders from upper management. The writers of the reports were well aware of the

situation yet they acted in this manner on the instruction of a supervisor.

Acting in an ethical manner becomes a secondary priority in this type of

environment. As stated by Alan Reder, “if they [the employees] feel they will

suffer retribution, if they report a problem, they aren't too likely to open

their mouths.” (113). The workers knew that if the reports were not falsified

they would come under questioning and perhaps their job would be in jeopardy.

Although working under these conditions does not fully excuse an employee from

moral fault, it does give a starting point to help narrow down the person or

department that issued the original request for the unethical acts.

The third mitigating factor is one that perhaps encompasses the majority

of the employees in the Company X case. We have to balance the direct

involvement that each employee had with the defective parts. Thus, it has to be

made clear that many of the employees did not have direct involvement with the

testing departments or with the parts that eventually failed. Even employees,

or sub-contractors that were directly involved with the production were not

aware of the ignorance on the part of the testing department. For example, the

electrical engineer that designed the defective computer chip could have stated

that it was tested and it did indeed meet the required government tests. Also,

for the employees that handled the part after the testing process, they were

dealing with what they believed to be a piece of equipment that met government

standards. If the part was not tested properly, and did eventually fail, isn't

the testing department more morally responsible than the designer or the

assembly line worker that was in charge of installing the chip? In large

corporations there may be several testing departments and in some cases one may

be held more responsible than another depending on their involvement. A process

like this can serve as a dual purpose for finding irresponsible employees as

well as those that are morally excused.

The fourth mitigating factor in cases of this nature is the measure of

the seriousness of the fault or error caused by the product. Since Company X

was repeatedly being added to the list of approved government contractors, one

can safely assume that the level of seriousness, in the opinion of the

contractor approval committees, is not of monumental importance. Yet a person

has to wonder how this case would have been different if it caused the loss of

life in a military setting. Perhaps the repercussions would have taken effect

much faster and been more stringent. The fact that Company X did not cause a

death does not make them a safe company. They are still to be held responsible

for any errors for which their products cause, no matter the extent.

As for the opposition to the delegating of moral responsibility,

mitigating factors and excusing factors, most would argue that the corporation

as a whole should be held responsible. The executives within a corporation

should not be forced to bring out all of the employees responsible. A company

should be reprimanded and be left alone to carry out its own internal

investigation and repercussions. From a business law perspective this is the

ideal case since a corporation is defined as being a separate legal entity.

Furthermore, opposition would argue that this resolution would benefit both the

company and the government since it would not inconvenience either party. The

original resolution in the Company X case was along these lines. The government

permanently removed Company X from its approved contractors list and then

Company X set out to untangle the web of wrongdoing from within. This allowed

for a relatively quick resolution as well as an ideal scenario for Company X.

In response, one could argue that the whole...

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