Business Ethics: Bath in Works - Case Study Example

Business Ethics: Bath in Works Case Study Introduction Within a business setting, ethics are reflective of the rights and wrongs defined by an organization as it pursues its strategic objectives. The study of ethics, in general, entails being able to identify, assess and select the appropriate values to be used as standards of judgment. These values are then applied in order to arrive at acceptable judgments. Business ethics sets out to encourage managers to fit in an ethical imperative in the corporate strategic process as well as providing guidance so that this can be achieved. Due to the fact that businesses are going global and as such interacting with varying cultural along with economic differences, this process of fitting in an ethical imperative into the corporate strategic process is largely relevant (Flynn 13). Ethical strategies inculcated at a global level call for having informed values that are applicable to changing economic conditions, thus; flexibility is mandated. Ethical strategies are planned courses of action and tactical decision making that do not violate the preset values set out as blueprints for arriving at certain standards of judgment. As organizations expand to operate across and between nations of the world, the definition of globalization, the definition of ethics takes a broader perspective and widespread application (Beer 1-2). Ethical Dilemma faced by Bath In Works’ CEO The CEO of Bath in Works was handed a document that feature a comparison of costs between BIW’s and Ingalls’s building of the Aegis destroyer. Both companies are major shipbuilders in fierce competition where they both get contracts from the government. Owing to their capability, BIW had been approached to build two naval Aegis destroyers at 250 million dollars each and this contract was also given to Ingalls. Mr. Haggett, being a CEO, was probably faced with the temptation of finding out how the comparison of costs would be beneficial to his company and possibly get pointers from their competitor on how to cut back on their costs. This was why he probably asked the two vice presidents to make copies and went on to analyze the documents for a few hours and make a computer model based on the same. This interfered with the strict moral code of the bidding process and such he was in contravention of business ethics. Instead, being the CEO of a company that acts as a signatory to the Defense Industry Initiative on Business Ethics and Conduct, Mr. Haggett should have referred to the document as a guideline on his next course of action once the document was handed to him. There is a principle within the Initiative that expressly states that companies have to self-govern by observing compliance to federal procurement laws and to adopt procedures for volitional disclosure of violations of federal procurement laws along with remedial actions taken. The President Duane Fitzgerald was able to refer to this and this made him decide to have the documents shredded and all data be erased from the computer. Mr. Haggett at this point admitted he was in the wrong and agreed to deliver personally the original document to Ingalls. However, he failed to mention that copies of it had been made. Once again, he failed to comply with the Initiative where he should have voluntarily disclosed the violation of making copies of the original document as a contravention to the federal procurement laws. His choice of action may have either been because he did not know he had an obligation to disclose that copies were made or he knew but did not think it would be as important. Practical Options in the face of the Ethical Dilemma Mr. Haggett should not have rushed to a decision once the document was handed to him, especially since he was heading out to give a luncheon speech. His mind was not clear as he was preoccupied with delivery of the luncheon speech and thus only spared 15 minutes to go through the document. The practical action would have been to pass it on to the President, Mr. Fitzgerald for advice since he was leaving the office and arriving at an ethical decision in that moment would have been tricky. Further, he should not have included the two vice presidents in any decision he arrived at in that moment as the document contained sensitive information. His alternate course of action could have been to leave the document locked in his office and make a decision after returning from the luncheon speech. This would have allowed him to be objective and clear, and arrive at a decision that had been carefully thought through. Further, of importance as well in business ethics, is understanding that having a second opinion on an ethical issue helps and the second opinion should be sought from a senior person. This is because making ethical choices will more often than not be complicated as ethical issues tend to be ‘gray’ areas. Above all, one should always look to the code of conduct and ethical principles set by the organization for reference. This acts as a guideline for making appropriate judgments and ensures that one has considered all the necessary elements of a particular course of action. In Mr. Haggett’s case, he probably considered only what was best for his company and neglected to consider the integrity of government processes of contracting. Related conceptual problems and issues The main conceptual issue underlying business ethics is morality or moral philosophy, this is what helps one act accordingly and be aware of what is right and their obligations in terms of the position held. Therefore, it is crucial that organizations lay a foundation of the underlying concepts of business ethics so as to enhance understanding of the practical application of business ethics. This ensures that blurred distinctions, misconceptions and misunderstandings are eliminated and courses of action are clear to employees and managers. Furthermore, it should be noted that business ethics does not outwardly pinpoint what is right and wrong or what one should do in a certain situation, rather it provides a framework for which right and wrong can be defined. Generally, the decision that one arrives at or the judgments that one makes are not expressly stated in a code of ethics and conduct instead they are guided by it (Morris 348). Mr. Haggett suffered an error of judgment owing to his selfish actions where he failed to destroy the document as soon as it was handed to him or take more time to arrive at a sober decision; his course of action was centered on what would benefit his company alone. These selfish actions are as a result of lack of morality functions that should be inculcated in a code of conduct and ethics highlighted by organizations. Further, he failed to acknowledge his mistake of making copies of the document either because he did not want to get into trouble or he simply felt it was unnecessary to mention it. This indicates a lack of moral philosophy where one must be willing to take responsibility for their actions to prevent a bad situation from getting worse as his actions could have sabotaged the company’s ability to get future government contracts (Robin 140). Relevant ethical principles and systems useful in developing alternate responses One ethical principle applicable in an organization like BIW is having an integrity scale for leaders where this should be administered upon their appointment and intermittently to ensure integrity is sustained. An integrity scale for leadership in an organization is essential as this reflects the organizational culture and this allows managers to set an example for their employees. Ethical leadership has been seen to beneficial in that it attracts high quality recruits and helps in retaining employees longer. Ethics for leadership is largely dependent on their level of integrity and as such having an integrity scale ensures that managers uphold integrity. The scale is used to measure the extent to which employees believe their managers uphold integrity. This allows an organization to be aware of any gaps in ethical training and plan for the same. The scale features three levels- high, moderate and low where employees rate their employees in each of the levels (McCann &Holt 211-212). Upholding integrity would have made Mr. Haggett adhere to a strict moral code and arrive at an ethical course of action. Another principle is application of the Buddhist view of the self where one should be selfless such that they put the needs of others before their own. This challenges the Western way of life that is founded on self-interest and acting according to that which satisfies personal interests and wishes. This calls for detachment from substantial material benefits, which is aided by moral living among other factors. By ascribing to this view, one becomes considerate and has in mind what is best for the community and environment secondary to individual wants. This principle is additionally beneficial to the individual as it allows them to experience true happiness (Zsolnai 3). Having such a principle enshrined in the code of conduct and ethics ensures that people within an organization learn to be objective and put their self interests secondary to those of the community and the environment. Mr. Haggett, having this principle would have made him to voluntarily disclose that he had made copies of the document as well as not risk the company being debarred from government contracts. Similarly, he would not have had to quit his job and sever all ties with the company which had sentimental value to him. All in all, ethical principles practiced by different organizations are based on socio-economic scopes and cultures ascribed to but since organizations are going global, it is important to adopt ethical principles that are comprehensive such that they consider other cultures and varying socio-economic backgrounds. In the same way, it should be understood that practice of business ethics is largely dependent on leadership where leaders must accept this responsibility and strive to set good examples. Works Cited Flynn, Gabriel. Leadership and Business Ethics. Dublin: Springer Publishers. 2008. Print. Beer, Lawrence. A Tactical and Strategic Approach to Global Business Ethics. New York: Business Expert Press,. 2010. Print. Morris, Donald. "Defining a Moral Problem in Business Ethics." Journal of Business Ethics 49.4 (2004): 347-57.  Robin, D. "Toward an Applied Meaning for Ethics in Business." Journal of Business Ethics 89.1 (2009): 139-50.  Mccann, Jack, and Roger A. Holt. "Perceived Leadership Integrity in the Manufacturing Industry." Journal of Business Ethics115.3 (2013): 635-44.  Zsolnai, Laszlo. Ethical Principles and Economic Transformation: A Buddhist Approach. Budapest: Springer Publishers. 2011. Print. Read More