Memorandum

To:Mgmt 2304 Student Consultant

From:Martha McCaskey

2015/1/27

Re:&nbsp&nbsp&nbsp&nbsp What to Do?

  1. Problem

Thecase study elucidates information about the ethical challenges thatMartha McCaskey’s organization is facing ethical dilemmas. TheSelerisAssociates is based in San Francisco and it consults for Siliconbased experts and companies for a profit (VanDiesel &amp Margolis, 2002).The reputation of the company is at risk because of engaging inunethical business transactions that include bribing their sources ofinformation to provide sensitive information to Selerisclients. Martha McCaskey is tasked with the project of collectinginformation about the best processes and cost measures to produce anew type of computer chip. McCaskey pays an ex-employee of the targetcompany to interview him to gain more information about the chip (VanDiesel &amp Margolis, 2002).The main challenges the company is facing is revealing their sourceof its information to its clients. Therefore, Seleris is conducting aform of espionage from companies to help competitors provide similarproducts at a lower cost to capitalize on the market demand forcheaper computer chips.

  1. Recommendation

Thefirst recommendation requires McCaskey to stop bribing Devon toreveal more information fro the competitor company to share withIAD’s clients, who are direct competitors. The secondrecommendation is that McCaskey should start developing an ethicalcorporate culture that would consolidate the IAD’s reputation andincrease their market share in the consultancy sector. The scenariois expected to change the wrong doing as a normal phenomenon from theculture of the company (Palmer, 2012). The third recommendationasserts that McCaskey should not steal information from Devon fortheir client, since it is ethically wrong to pass for someonedifferent to extract propriety. If IAD’s routine bribery practiceis exposed, McCaskey’s action would damage the company’sreputation. Besides, the consulting company could lose its businesscontacts and remain blacklisted in California for breachingproprietary guidelines. The last recommendation is that IAD mightface prosecution for illegal collecting and distributing copyrightedprocesses’ information from one competitor to another.

Evenif the McCaskey walks away from Silicon 6 as suggested in the casestudy, she still remains a worker in the company and she must startto control its processes of acquiring propriety information throughbribes. The routine of using enticement tactics to gain informationfrom ex-employees of the target competitor company is unethical.Instead, IAD should approve the McCaskey’s way of travelling toseminars, attending conferences, and interviewing different peopleto find the latest information on any project.

  1. Factors

  • Organizational Profit: IAD’s consultancy is based on paying off ex-employees to extract valuable information that is traded to competitor companies to gain a profit. Essentially, they are paid to gain propriety information so that a competitor company can produce a similar chip as the proprietor organization without incurring the heavy cost of research and development. Thus, the cost saved by the IAD’s intervention by providing process and cost analysis information is what passed to them as their payment for consultancy. Furthermore, IAD make more profit from engaging in shady deals that break the law (Palmer, 2012). However, they cleverly pay for the information to seal the loophole from the public. On the other hand, the consulting company would lose more money by providing estimates that would require their client to conduct further research and development to clarify the IAD’s estimates. Therefore, they are paid for their efficiency in providing sensitive information that cannot be found elsewhere.

  • Corporate Reputation: IAD’s reputation in California and particularly in the Silicon Valley depends on how they treat their clients. Team behavior influences the individual in making decision that affect corporate reputation (Fernando, 2010). In the McCaskey’s case, she is confronted with a situation that undermines her managerial credibility in dealing with unethical issues. IAD could lose its corporate reputation for engaging illegal business activities of collecting proprietary information.

  • Ethics: The contemporary world appreciates companies that approach business transaction in a transparent manner (Fernando, 2010). Ethical ways of collecting classified information requires full disclosure of the intended application. Contrastingly, McCaskey hid her business intention of selling the information collected from Devon. The behavior of falsifying identity to gain propriety information is unethical and unfit for a corporation operating in the international business circles.

  1. Alternative Solutions

  • Compromise: McCaskey can continue with the project, but interview Devon on a wide range of cost structure and processes to create an innovative chip better than what the competitor is working on. In this case, McCaskey would avoid asking directly for the competitor’s data structures that breaches the proprietary information.

  • Yield: McCaskey could yield to the suggestion by Malone to pay the highest consultancy fee of $7000 to Devon to collect all the valuable information from the ex-employee (Van Diesel &amp Margolis, 2002).

  • Force: McCaskey has the right to decide on the best way forward as the manager of the company. Therefore, she can withdraw from project Silicon 6 and ask the management to appoint the another employee to take over citing serious ethical concerns.

  1. Comparison of Solution

Acompromise is the best alternative solution for collectinginformation on a wide set of structured costs and processes. The endresult of the solution is that the client is expected to spend moremoney to test all the provided data sets before discovering the bestproduction technology. On the other hand, the option would guaranteethe client a comprehensive set of information to refer from whiledoing research and development of the chip. The solution is ethicallycorrect, profitable, and gives IAD credibility as a corporate as seenin exhibition 1.

IAD’stop management expects McCaskey to stick to the plan of paying Devon$7000 which is the highest consultancy fees to an expert sharingproprietary information (Van Diesel &amp Margolis, 2002). Thesolution is timely and would save the company a lot of costsassociated with collecting and surrendering the information to theclient. Moreover, the question about the source would be easilydisclosed without affecting the reputation of the affected persons.However, in case the proprietary information leaks out, then theyield would make IAD lose their corporate reputation and clients.

Similarly,McCaskey can enforce her right as the manager of the company’sculture and ask both Malone and Richardson to appoint anotheremployee like Hackert or Rendall to handle the Devon interview.However, the solutions would compromise the McCaskey’s managementreputation in the company and she might never become a manager fordisobeying Richardson and Malone’s idea of getting informationfaster and timely for clients.

  1. Implementation Plan

  • First, McCaskey should approach Richardson and Malone and explain the compromise situation and assess if they like the new interview approach.

  • Second, if the management rejects the appeal then McCaskey will yield and interview Devon as per company specifications.

  • Third, should McCaskey doubt the unethical approach enforced on her by the management, the she will use force to reassign the project to another worker since it includes engagement in illegal business activities.

  • Lastly, if IAD accepts the force option, then McCaskey should consider changing the ethical mission of the company to help consolidate its name and reputation.

Exhibition

Options

Profit

Corporate Reputation

Ethics

Compromise

Good

Good

Good

Yield

Good

Bad

Bad

Force

Bad

Fair

Good

Problem Solution

Good

Fair

Good

References

Fernando,A. C. (2010). BusinessEthics And Corporate Governance.New Delhi, India: Pearson Education India.

Palmer,D. (2012). Normalorganizational wrongdoing: a critical analysis of theories ofmisconduct in and by organizations.London, England: Oxford University Press.

VanDiesel, B. J., &amp Margolis, D. J. (2002). Martha McCaskey.&nbspHarvardBusiness School, 9-403-114.