CASE STUDY
An official inquiry into a British doctor convicted of 15 murders is likely to conclude he may have killed up to 300 in total, the Daily Telegraph reported on Monday. If so, it would make him arguably the world’s best serial killer.
The tribunal investigating the macabre career of Harold Shipman, nicknamed Doctor Death, is due to publish its findings this month, a spokesman said. Headed by Judge Janet Smith, it started off looking into around 800 suspect deaths before later narrowing the field down to just over 500. According to the paper, Smith’s inquiry will conclude that he killed about 300 patients during a medical career that began in early 1970s. The daily express said she would fix the final murder toll at precisely 297 deaths. He pleaded not guilty and his motives remains a mystery, although the Daily Telegraph said he had been diagnosed as a classic necrophiliac, murdering his victims simply for the pleasure he got from watching people die.
Answer the following question.
Q1. What do you find unethical in this case? Elucidate.
Q2. Explain an ordinary citizen’s role in the prevention of such crimes.
CASE STUDY
By way of introduction, let me state my (a freelance writer) most fundamental belief about organizational ethics: Ethics is not about answers. Instead, ethics is about asking questions. It’s about asking lots of questions and, maybe, if you’re lucky, even asking the right questions every now and then. In my experience, ethical organizations don’t shy away from asking potentially embarrassing questions, ones that might disturb the status quo. The need and value of doing so was brought home clearly in the Enron/Arthur Andersen scandals. Those were two organizations where, apparently, no one dared ask the tough questions that might actually have saved the companies. Now, thanks to those and related scandals, the good news is that corporations are routinely asking tough questions about financial reporting. Today, we’re all terribly conscious of the risks to the organization if we fail to question the numbers. Almost all of you are in the firing line in that regard, so there’s very little that I can tell you about the importance of assessing financial risk. I don’t have the level of knowledge that you have about financial accounting, but I do have some related experience that I’m going to draw on in my remarks today. As you know, I’m a professor of management, but today I am drawing on my experience as a member of the board of a NASDAQ company for some ten years. I served as a chairman for the Audit Committee until they actually required that you know something about auditing. Now I am on the Compensation and Governance Committee. I am proud of the record of our little company: We have been squeaky clean from day one. As a matter fact, when we went public 10 years ago, we had little buttons that we all wore that said, “We be clean.” This is because we had a member of the board named Robert Townsend, the man who created the Avis Corp., and he was not only one of the great management thinkers but also one of the most ethical business leaders this country has known. He insisted upon spotless ethics in everything we did, and it became part of the culture of the company. If there was a nickel on the books that was in question, we have always interpreted accounting rules in the most conservative way. We have never had anyone question our numbers and I hope to God we never will.
But the story doesn’t stop there. Recently our board undertook a thorough audit of the human resources function of our organization. The recent negative exposure that companies like Nike and LeviStrauss have experienced concerning working conditions in their plants in Asia convinced us that consumer products companies run considerable risk in this arena. There was a bit of resistance to undertaking this audit. In fact, as at most companies, the eyes of our HR people glazed over whenever we used the word ethics. We are a small company, so we don’t have somebody who was an ethics officer per se, so it fell to the board to raise these questions. Questions for the Compensation and Governance Committee Once we started to do so we quickly came to realize that there was an entire raft of HR associated issues that we had to monitor if we were to assure our shareholders we had done adequate risk assessment in the organization. Our board members are not experts in this arena, but we realized that we had to be able to assess risks in all the corporation’s major human capital management systems: selection and recruitment processes, training policies and programs, performance appraisal systems, executive compensation, sales and other forms of incentive compensation, base pay and benefit determination, talent management systems (including manpower and succession planning), labor relations, and so forth. We had to ask if there were appropriate methods and analytical programs in place that monitor for age, sex, and gender discrimination; employee attitudes and morale; talent procurement and retention? We wondered to what extent potential employees saw our company as a great place to work. We started having to pay attention to health and safety, termination and downsizing policies, demographics about who gets promoted, raises, bonuses, and turnover. As we went on, we increasingly sought to discover the extent to which the company was on top of liabilities in those areas from a measurement and analytical perspective. With regard to all major HR systems, our board began to ask the following kinds of questions: Is there a formal system or process in place? Has the system been validated? Is it clearly understood and communicated? Has the system had unintended effects? Has it been analyzed for adverse effects, for example, possible discriminatory impact on legally protected groups? Each time we asked questions, we had to go back to learn more, we had to ask more sophisticated questions. Some questions we asked with regard to leadership development and talent management were things we thought the board would never get involved in. We started asking if there was a formal assessment of the key capabilities/talents needed in the company. We asked if retention rates were monitored? Did the monitoring include an analysis of criticality? Did it include competitive practices, capabilities, and performance? To what degree was the expertise of key people captured by the organization? Were there non compete agreements with key technical people? Does our reward system lock key contributors into the organization? We didn’t have a clue what answers we were looking for. This was a matter of constantly asking every possible question that we could think of. For example, when we looked at the succession planning system, we asked if the system was formal, who was involved, and how it was related to business strategy. We asked what metrics were used and were they related to assessment of needed capabilities? How do we monitor for derailment? Is there a system of mentoring and coaching? Is it seeing as effective and fair? That led us into questions about training policy: Who participates? What are the purposes of the programs? How are they evaluated? How are they related to business strategy? How do these programs deal with ethical and legal issues? Are there unintended gender, race, or age biases in who attends? Then, we started looking at selection procedures: Did we use validated instruments for identifying the “right” people? How were these related to business strategy? What methods were used? To what extent is an effort made at branding our company as a great place to work? Finally, we looked at retention policies: the retention packages for key personnel, how we are monitoring satisfaction, whether the packages are tied to system performance appraisal, and what metrics are used to identify key personnel, and so on.
Answer the following question.
Q1. How the writer defines the organizational ethics. Comment.
Q2. What are the benefits of routinely asking tough questions about the related issues? Discuss.
CASE STUDY
As per a judicial order, a minister was ordered to pay a fine of Rs. 15 lakhs for allotting 15 petrol pumps, while another minister was fined Rs. 60 lakhs for causing a loss to the exchequer by allotting 52 shops or kiosks to some favorites.
Answer the following question.
Q1. What exactly are the improper actions that you consider unethical?
Q2. Judicial orders in the interests of the nation are a must. Discuss this statement.
CASE STUDY
Since the story broke that VW deliberately buried emissions results in its software, plenty has been written about this case of corporate malfeasance, perhaps more than any since Enron. The Volkswagen brand crisis seems fairly straightforward to me. With no mission or values, I contend there is no hope for achieving VW’s goals ethically and in a way to sustain the company. Some confuse mission statements with other corporate communications that are really marketing taglines and slogans. Mission statements are not typically external documents, used to convince others of the value the company creates. Rather the most effective mission statements are largely internal documents, guiding people within an organization about its purpose and paired with a values statement so that organizations have clarity about both their purpose and how they are going to achieve it. Volkswagen doesn’t have a mission statement. There were values stated in the 2006 annual report, but they disappeared in future years. A vision statement dated June 2011 pronounced: “By working in cooperation with politicians and society, the world of business can play a key part when it comes to combating serious environmental issues and social inequality. Volkswagen’s main contribution to the project is related to sustainable mobility.” An analysis by Strategic Management Insight 2013 could find only this goal in lieu of a mission statement: “The Group’s goal is to offer attractive, safe, and environmentally sound vehicles which can compete in an increasingly tough market and set world standards in their respective class.” SMI found Volkswagen Group’s goal lacked any statement of values or philosophy, did not mention customers, employees, or technology. It achieved a score of 1.6 out of a possible 4.5 in SMI’s evaluation. By 2014, Volkswagen’s annual report talked about its strategy. Still no mission, no values: “Our Strategy 2018 focuses on positioning the Volkswagen Group as a global economic and environmental leader among automobile manufacturers. We have defined four goals that are intended to make Volkswagen the most successful, fascinating and sustainable automaker in the world by 2018.” These goals related to innovation, customer satisfaction, sales, profits and employee retention, but say nothing about core values. In 2010, Volkswagen joined 21 other German automakers in 2010 in agreeing to a “mission statement for responsible actions in business.” Yet it sill operated without a clear core set of defined beliefs or values to guide VW’s work, or a motivational or reward system aligned with a mission. While the six principles seem well intentioned ecologically, without a well designed system to support this goal, Volkswagen missed achieving it, and in fact, behaved in a way counter to its stated aspiration. Employees everywhere roll their eyes through discussions of mission, purpose, and values. For many, uninterested in the larger system they operate within professionally, they seem bored sitting in long meetings listening to what are for them buzzwords that get in the way of the real work to be done in any company. Volkswagen was the largest automaker in the world in 2011, offering 13 brands from Audi to Porsche. That was a few strategies and vision statements ago. Today Volkswagen’s share price is half what it was a year ago, following a precipitous stock price drop when news of the scandal broke. It’s recently appointed CEO has been reported to take the same misleading software design approach during his time at Porsche. No surprise, given that he was working in the same purposeless company, without an articulated set of values to guide his work. Much more will likely be written about VW and, as it not is its first corporate scandal; perhaps the company’s epitaph is in the works. Bottom line: no mission, no hope.
Answer the following question.
Q1. Discuss why the effective mission statements should be paired with a values statement.
Q2. Give your views on the case and sustainability.