Business Ethics Case Study Examining The Issues Related To The Confidential Data
Question
Task: Michael Vasquez was proud of his job as a new product managerfor a technology start-up, and he loved the challenges, risks andtough decisions that went along with the job. But as he sat in hisoffice after a long day, he was troubled, struggling over what hadhappened earlier that day and the information he now knows.Just before lunch, Michael’s boss had handed him a pile of privatestrategic documents from their closest competitor. It was acompetitive intelligence gold mine – product plans, pricingstrategies, partnership agreements and other documents, mostclearly marked ‘private and confidential’. When Michael askedwhere the documents came from, his boss told him with a touchof pride that he had taken them right off the competing firm’sserver. ‘I got into a private section of their intranet anddownloaded everything that looked interesting,’ he said. Later,realising Michael was suspicious, the boss would say only that hehad obtained ‘electronic access’ via a colleague and had notpersonally broken any passwords. Maybe not, Michael thought tohimself, but this situation wouldn’t pass the 60 Minutes test. Ifword of this acquisition of a competitor’s confidential data evergot out to the press, the company’s reputation would be ruined.Michael didn’t feel good about using these materials. He spent theafternoon searching for answers to his dilemma, but found noclear company policies or regulations that offered any guidance.His sense of fair play told him that to use the information wasunethical, if not downright illegal. What bothered him even morewas the knowledge that this kind of thing might happen again.Using this confidential information would certainly give him andhis company a competitive advantage, but Michael wasn’t sure hewanted to work for a firm that would stoop to such tactics.Sources: Adapted from Weber, Kent (January−February 2001).Gold Mine or Fool’s Gold? Business Ethics, 18.
Questions
1. What is the ethical issue in this scenario?
2. What should Michael do? Justify your answer using at
least two ethical theories.
3. Do you perceive Michael’s boss to be ethical or unethical?
Explain your answer in detail
4. Should Michael blow the whistle? Define ‘whistleblowing’.
Explain what motivates whistle-blowers and under what
circumstances whistleblowing is justified?
5. Based on the case study, provide four reasons why ethics
is relevant to business?
Answer
Introduction
The term business ethics explored in the present business ethics case study is an applicable business practice associated with the controversial subjects like corporate governance, discrimination, bribery, discrimination and corporate social responsibility (CSR). This assignment is focused on the Business ethics case study about Michael Vasquez, the new product manager of a technology company, who suffers from an ethical issue relating to the use of confidential data of the competitor for the purpose of attaining competitive advantage. Furthermore, it provides justification to the answers with the help of ethical theories and discusses about the conduct of Michael’s boss. At the end of this report, the concept of whistleblowing has also been discussed along with the reasons behind the relevancy of ethics to business.
1. What is the ethical issue identified in the business ethics case study?
The occurrence of ethical issue takes place when a given scenario, decision or activity results in the creation of conflict with the moral principles of the society. In simple words, ethical issue is the situation of dilemma or the confusion between right and wrong towards making a choice between alternatives. Here, in this case, the ethical issue is being faced by Michael Vasquez in the given scenario as he has been given the private strategic documents and other confidential data of the closest competitor of the company by his immediate boss. Moreover, he has been told that the data is obtained with the help of the electronic access with the help of coworker and no password has been personally cracked by the boss. Michael suffered from the dilemma regarding whether he should make the use of such confidential information of the competitors for the benefit of the company or not.
Here, ethical issue arises because there is an absence of guidance for right poicies of the company. Michael is also aware of the fact that the use of such information is unethical and is therefore, not feeling good about it. Since he is working for the company he is under obligation to act in accordance with the instructions of his superiors or boss. Therefore, he cannot put the reputation of the company at stake by publicizing that the confidential data of the competitor has been acquired by the company. Moreover, if he agrees to act as he has been told to act then in such a case these activities will be continued in the future as well. Even when he knows that the performance of such activities will offer competitive advantage to him and the company, he does not want to work for an organization that makes the use of such kind of tactics for attaining success in the marketplace (Trevino and Nelson, 2016).
2. Suggestions to Michael using ethical theories
As per the readings obtained in the given business ethics case study, Michael should make the use of such information as guided by his boss for the benefit of the organization. As he is the employee of the organization, he is under obligation to act as per the instructions of their superiors. This ethical issue being faced by Michael can be resolved with the help of ethical theories namely deontology and utilitarianism. The deontological ethical theory provides that people are required to comply with their duties and obligations in cases when they are needed to make decision based on ethics. This means that the obligations to another individual should be followed by a person because upholding the duty is regarded as ethically correct (Chen, 2019).
Utilitarianism is another ethical theory used to support the case scenario of business ethics case study which is grounded on the capability of an individual to forecast the outcomes of an action. The choice that results in the utmost advantage to majority of the individuals can be regarded as the one which is ethically correct. Act utilitarianism is the type of utilitarianism which provides that those acts should be performed by the person that offers benefit to most of the individuals, irrespective of the societal constraints like regulations or personal feelings. A number of employees in the company will be benefitted with the attainment of competitive advantage by the organization; therefore, Michael should choose to utilize the private information of the competitor for the advantage of the business (Barry, 2016).
3. Perception to ethical or unethical situation.
Michael’s boss is perceived to be unethical as the manner adopted for attaining competitive advantage in the market is not ethically correct. Ethics in business facilitates healthy competition and does not encourage the companies to engage into malpractices for gaining competitive edge. The basic focus of healthy competition is on the delivery of quality products to the customers along with constantly looking for ways which can be adopted for the purpose of improving it so as to make it superior than that of the competitors. Also, it makes the companies conceptually strong and encourages them to make the use of their limited resources for maintaining quality. On the other hand, unhealthy competition is a negative process and deviates the companies from the path of success (De Cremer and Vandekerckhove, 2017).
This is the unethical practice that is being asked by Michael’s boss to be performed for ensuring the success of the company. It is ethically incorrect to obtain the private and confidential data of the rival through unfair means. Instead of doing this, the boss should have formulated innovative strategies that are competent enough to beat the strategies of the rival company thereby gaining the confidence of the customers in the corporation. Moreover, it has also been noted in the business ethics case study that this decision of using the confidential information of the closest competitor will slowly lead the company to lose its reputation when the customers will get to know about it. Moreover, the employees who want to stay on the ethical path will also leave the organization leading to a significant fall in the employee retention ratio of the company (McMurrian and Matulich, 2016).
4. Define ‘whistleblowing’. Explain motivators for whistleblowing.
The business ethics case study used to develop this report mentions that Michael is suggested to blow the whistle against the boss of the organizations he is engaged into unfair practices and also asking Michael to make the use of such information for the benefit of the company. Whistle blowing by him is justified as he have the documented evidence in the form of private documents of its rival that involves the pricing strategies, product plans, partnership contracts and additional related documents that have been marked private and confidential.
The term whistleblowing examined in the context of this business ethics case study can be described as the raising of voice by the employee of an organization against the unethical conducts that are being carried out within the business. The person who raises the voice is referred to as the whistle blower. The whistle blowers are basically motivated as a result of moral reasons which are far above the monetary reasons. In simple words, it is the drive for justice which motivates the whistle blowers to blow the whistle. The reason behind why the employees prefer speaking out is that they genuinely believe that it is their ethical obligation to blow the whistle if something is going wrong in the business. The given case provides that Michael was aware of the fact that the use of the confidential information of competitors will lead him to new heights in the organization, still he was in dilemma whether he want to continue his working with the organization.
There are a number of circumstances in which whistle blowing is considered to be justifiable. Firstly, when an employee is able to identify any sort of severerisk of harm to other workers, consumers, investors or their moral concern, whistle blowing is justifiable. Secondly, it is also justified when no action is being taken by the supervisors even after the best efforts on the part of employees for remedying the situation of unethical actions. Thirdly, when there is documented evidence available with the employee that can prove the facts to the test of law or to the outside public, and then in such a case whistle blowing is correct (Zakaria, 2015).
5. Are ethics relevant or not?
Business ethics, often referred to as corporate ethics, perform the function of guiding the officials to satisfy the needs of the company along with that of the community from which they obtain the resources required by them for performing the day to day activities. On the basis of the given Business ethics case study, following reasons have been provided that highlights why ethics is significant or relevant for the business:
Ethics allows making strategic decisions- The employees and superiors of the companies that portray ethical behavior are capable of making those decisions which are considered to be socially acceptable. Furthermore, it assists in the participation of all the investors in the process of decision making of the organization. It will help the case study company in making decisions that are strategically and ethically correct.
Ethics Increases employee retention- The term employee retention can be described as the capability of a company to retain its employees in the organization for a longer duration of time. As far as the perception of the employees is concerned, they want to work in those organizations or companies in which their opinions and rights are valued. This can also be linked with the given Business ethics case study where Michael does not want to work with the company that uses unethical tactics for gaining competitive advantage in the market.
Ethical practices play an important role in building and maintaining reputation- The ethics of the business play an important role for the customers in scrutinizing whether they want to engage with the business or not. Business success is ensured only when it is capable of maintaining a good reputation among the customers. The given Business ethics case study also provides that the reputation of the company will be ruined in case the acts of the company will go out to the press.
Business ethics allows healthy competition- Ethical behavior does not lead the companies to get into malpractices, instead they allow the customers to make the choice as per their liking. In the provided Business ethics case study, the company is found to be engaged in using unfair means for attaining competitive advantage in the market (Crane, Matten, Glozer and Spence, 2019).
Conclusion
Therefore, it can be concluded after analysing the above Business ethics case study that Michael is suffering from the ethical issue relating to the use of confidential information of the competitor for the advantage of the company. Michael should therefore, fulfil his obligation towards the organization and should do as instructed. However, the practices being adopted by Michael’s boss are completely wrong and he should stick to healthy competition for gaining competitive edge in the market. Michal is suggested to blow the whistle against the boss for the purpose of informing the higher authorities and stakeholders regarding these practices being undertaken in business. Therefore, considering the overall findings obtained in the Business ethics case study, it can be stated that ethics is relevant for the business as it allows making strategic decisions, increases employee retention, building reputation and practicing healthy competition.
References
Barry, N., 2016. Business ethics case study Business ethics. Springer.
Chen, Y., 2019. Deontology to Judge the Ethical Business Actions: The Case of Takata. Open Journal of Business and Management, 7(2), pp.783-787.
Crane, A., Matten, D., Glozer, S. and Spence, L., 2019. Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford University Press.
De Cremer, D. and Vandekerckhove, W., 2017. Managing unethical behavior in organizations: The need for a behavioral business ethics approach. Journal of Management & Organization, 23(3), pp.437-455.
McMurrian, R.C. and Matulich, E., 2016. Building customer value and profitability with business ethics. Journal of Business & Economics Research (JBER), 14(3), pp.83-90.
Trevino, L.K. and Nelson, K.A., 2016. Managing business ethics: Straight talk about how to do it right. John Wiley & Sons.
Zakaria, M., 2015. Antecedent factors of whistleblowing in organizations. Business ethics case study Procedia Economics and Finance, 28, pp.230-234.
