Question

Case:

Carl Kelly is an American transpatriate assigned to Motorola’s facility in a former USSR satellite nation in Eastern Europe, called Ruritania. Carl has found that Ruritanian culture strange and experienced a bit of culture shock, which explains why he arranged to have his wife Kathleen join him as soon as possible. Kathleen arrived in Ruritania 10 months ago, eagerly looking forward to spending more time with Carl than was possible back in Florida. She was rudely surprised. In those 10 months she was able to spend “quality” time with him on exactly 7 weekends!

Then came some good news. Last month Carl was told that for the next four weeks you would be assigned to Surabaya, Indonesia. Kathleen, who had a long-standing interest in Javanese arts, wanted to go along. That way, on weekdays she could enjoy local music, dance, drama, painting and sculpture, and on weekends she and Carl could finally snatch some quality time together in nearby Bali.

But there was a problem. All three of the Kelly children were in college, and their combined tuition payments were huge financial burden, making it difficult to afford Kathleen’s airfare to Indonesia.

Yaroslav, a Ruritanian colleague of Carl’s, offered to help them out. Yaroslav got in touch with Easy Virtue Travel, a most obliging local company. That evening Easy Virtue delivered to round-trip coach tickets to Surabaya for Carl and Kathleen, along with a bill for just one round trip “business-class” passage for Carl. This way, Carl would bill Motorola for business-class reimbursement, while he and Kathleen would fly coach. Carl would be personally out-of-pocket only an extra $27.94 for Kathleen’s seat. “Not bad,” exclaimed Carl. “That will make up for all of those lonely weekends,” added an eager Kathleen.

That night, though, Carl had trouble sleeping. “Deserve it or not, this is probably against some corporate regulation. I better check with Sam.”

Sam Smoothover was Motorola’s HR manager for Ruritania. Sam had long experience in the former satellite countries and suspected that local Ruritania travel agencies often did things that were technically frowned upon by foreigners, yet actually humane in their consequences. Sam also enjoyed an enviable reputation for putting the well-being of Motorolans high on his list of value priorities – certainly higher than formal compliance with the details of regulations set by headquarters 4,000 miles away.

Sam’s reaction was, “Okay, Carl, you and Kathleen make the trip this time. I just don’t go around talking to people about it.”

However, a few days later Sam had his own second thoughts and decided to check with corporate officials in Schaumburg, just to make sure it really was okay.

Additional information for the case:

Motorola allows for business travel for any trip over five hundred miles so Carl could travel with a business class ticket. The home office also recognizes that the Ruritania assignment is difficult given the primitive living conditions there and that unlike several of his predecessors Carl has done an exceptional job meeting the requirements of the company.

Answer the following questions.

1.         What is the issue?

2.         Do you think that the travel plan for Carl and his wife appropriate? Why?

3.         What are your thoughts regarding Sam Smoothover's response to Carl? What would you have done?

Answer 1

1. The issue is about an executive working for a US multinational organisation on an assignment in a developing country, who deviates from the guidelines and policies formed by the company to accommodate personal issues. Karl, the person in case is able to secure a round trip ticket to Indonesia in coach class for him and his wife from a local travel company, which actually provides him with a bill of business class travel for Karl only, for which he is actually entitled as per company guidelines. In this way, he is able to take along his wife to the trip, a luxury he could not have afforded if he produced the bills of his actual travel for reimbursement to the company, the reason being significant difference between the fares of the two classes.

2.Though, by his conduct, Karl is not harming the company in any way, as he is entitled for what he is claiming. Still, he is ethically wrong, by furnishing false information to his company, even if it is benign in nature, and promoting corruption, which is a part of many developing countries. The travel plan was made out of necessity, but it can't be justified, given the ethical issues of incorrect reporting and abating corrupt practices. It brings the integrity of the person in question, even if he has taken care, not to harm company's interests.

3. Sam has been wrong in his approach by allowing Karl to travel this way. He should have taken the ownership of the issue. Karl was ethical in his approach by informing him before taking this action, but Sam should have asked his authorities back home, before allowing Karl to do so. If he committed not to talk to anyone in that regard, he should have kept it that way, as the issue was no means harming the interests of the company.