Question

Week 1 Discussion -- Ethical Dilemma

What They Don’t Know Won’t Hurt Them!

Revolutionary Electronic Technologies (RET) recently released a new advanced electronic micro system to be used by financial institutions, large corporations, and governments to process and store financial data, such as taxes and automatic payroll payments. Even though RET developed the technology used in the creation of the product, RET’s competitors are expected to possess similar technology soon. To beat the competition to the market, RET introduced its new micro system a little earlier than originally planned. In fact, laboratory testing had not been fully completed before the product reached the market. The tests are complete now, and the final results suggest the micro system might be flawed with respect to how some data are retrieved and processed. The tests are not conclusive, though, and even if additional testing proves that a flaw does exist, according to RET, it is of minuscule importance because the problem seems to occur for only one out of 100 million retrieval and processing attempts. The financial ramifications associated with the flaw are unknown at this time.

Assume that you are one of RET’s senior executives whose annual salary is based on the performance of the firm’s common stock. You realize that if RET recalls the affected micro system, the stock price will suffer; thus, your salary for the year will be less than you expected. To complicate matters, you just purchased an expensive house based on your salary expectations for the next few years—expectations that will not be realized unless the new microsystem is a success for RET.

As one of the senior executives, you will help determine what course of action RET will follow with respect to the micro system. What should you do? Should you encourage RET to recall the micro system until further testing is completed? What other courses of action do you suggest?

Below is the answer to one of my classmate. I need to responses something.

Quality of responses to at least two classmates. Say something deep & intuitive, don't just rephrase something you read or another student's posting.

Ethics is expressed through a set of rules that have become more or less explicit following a set of values displayed by the company. And then there is the behavioral ethics, specific to the individual, which is governed by his values, his beliefs, his convictions, and who must conform to the professional practices expected in his professional environment. Every day, we question ourselves consciously or not about our behaviors but we are also confronted with situations that do not seem to us necessarily ethical ... The human slips so easily under the pressure and the unconscious fears.

As an executive at RET, the ethical thing to do would be to enforce the recall because it will not only keep our integrity to the eye of the public but also add to our credibility. Money is always tempting but being a professional requires to make the right decision at the right moment. A mistake was made at the beginning but we need to save the face of the company. It may seem like a loss now but in the long run it will benefit us. As an executive i always have to prioritize the customer, therefor not selling them a faulty product. In conclusion, personal gratification does not surpass the company's long term objectives.

Answer 1

This is a perfect scenario of conflict of interest i.e. conflict of personal interest and organisational interest. It is a situation where in a person of power is able to derive personal benefit from actions or decisions made in their official capacity.

The fact the incidence of failure is only one in 100 million is no reason to ignore since the financial ramification of the same has not been quantified. A failed product will not only affect the organization financiafin it would also affect the integrity and Goodwill of the organization.

Once the entire situation is laid down before the client they will appreciate the honesty and attempt of the organization.

As far as the personal interest of the senior executive is concerned, organisational interest takes precedence over personal interest if the personal interest comes in way of the organization''s mission, vision and objective.

This the correct course of action would be to recall the product and explain in full the prevailing scenario to the cuatcust.