Marriott School students and NAC members discuss an ethical dilemma as part of the school’s second annual Business Ethics Case, held in conjunction with the NAC Fall Conference.
The Case:
Today you have to make a difficult decision concerning a new hire to your IT team.
In desperation you recently offered a security expert position to Rajeev, a marginally qualified person outside the company. This morning you learned that because of an acquisition, Brian, a fellow employee and the person you really want and need, has just become available. Now you’re worried that if you don’t bring Brian onto your project, he’ll be laid off.
You work for large IT vendor Fleet Technologies and are the technical team leader on a multimillion dollar enterprise resource project for a new client. The client, a major medical device company, offers Fleet an opportunity to finally penetrate a cash-rich industry sector.
This project is also critical to the client as the implementation of Fleet’s system will bring significant cost savings. Plus, you need a technology solution that conforms to the many regulations of the medical device industry. Thus, VPs from both companies are closely monitoring the effort.
Because of the high-profile nature of the project, you’ve handpicked each member of your team. Having learned to trust Brian’s expertise from past collaborations, you brought him onto the project early to scope out the security-related issues. Unfortunately, you were able to work with him only on a part-time basis because he was tied up with a project for another client.
As much as you wanted Brian, you were able to find a suitable replacement in Nandu, another security expert from outside Fleet. But after only a few months, Nandu gave his two weeks’ notice, citing family demands. Your plan was to replace Nandu immediately so the new hire could huddle with him before he left.
Finding a replacement proved more difficult than planned. Rajeev was the only real candidate, and though he wasn’t on par with Nandu or Brian, you figured he could probably manage the first phase of the project. You hoped that a combination of your guidance and some consulting help from Brian would enable Rajeev to handle the second phase as well. With the pressure of a project still barely on schedule, you called Rajeev on Thursday with an offer. He accepted, and you asked him to contact Nandu to start the transition before reporting on Tuesday.
On Monday the office was buzzing with news of an acquisition of one of Fleet’s biggest competitors. That afternoon Brian called to tell you his project had been canceled because of the acquisition and that he was now available and anxious to join your team. (He’d been working on a product designed to compete with a product from the newly acquired firm.)
Brian is everything you were looking for and need. In addition, Brian was just working on the hardware platform your client currently uses, thus providing even greater value to your client. Brian also has a good understanding of the project, having initially helped you scope the proposal.
What do you do? Your project is already slightly over budget, and because of the acquisition, many IT professionals in your company are now considered redundant. Layoffs are inevitable. Fleet is expected to further squeeze budgets as the company looks for ways to integrate the acquired firm.
If Brian is laid off, you don’t know how Rajeev could possibly succeed during the second phase. However, you have given your word to Rajeev.
Which employee has a greater right to the job? The one who is highly qualified and has worked for the company several years, or the one who is marginally qualified and only recently accepted an offer? Rajeev is scheduled to come in tomorrow. You have a few hours to decide what to do.
Is It Ever OK to Break a Promise?
For two hours during November’s National Advisory Council Conference, this ethical dilemma was the subject of much discussion among 270 eager BYU business students and 140 NAC members and spouses.
This annual exercise is part of the Marriott School’s continued emphasis on ethics in business and gives both undergraduates and graduates the chance to learn from the sage business veterans on the NAC.
“It’s about taking what is most important about BYU, its sacred mission, and integrating it with an important, intellectual, secular mission in a way that provides students with an understanding of what we expect of them going forward,” says Brad Agle, George W. Romney Endowed Professor.
“We’re a business school unlike most business schools,” Agle continues. “Our mission isn’t just about how you do business to make money but how to do business while making positive contributions to society. That is the most important focus—how to do it the right way.”
NAC members first gathered in the Tanner Building’s new west wing assembly room for a quick case briefing by Agle, one of the country’s business ethics experts. They were also supplied with an ethics toolbox and some LDS perspectives to contemplate. Minutes later, NAC members scooted off to study rooms and conference rooms to meet with discussion groups of anywhere from four to twelve students.
Dave Holland found himself with fellow NAC members Alvin Jackson and Deanie Martino in a first-floor room sitting across the table from MBA students Ammon Chase, Kellen Moulton, and Tim Bishop.
As Chase, a former commercial litigator, and his MBA counterparts weighed in with logical solutions—“Economically, it seems like a pretty easy decision”—Holland explained how this very scenario plays out every day in the business world.
In 2000 Holland’s company was hiring 4,000 people a quarter when all of the sudden the dot-com bubble burst, and they didn’t need the people they had hired. Some of them hadn’t worked even a day.
His company ended up offering six-month severance packages to those terminated, including those who had never even clocked in.
“You can make this a company problem, instead of your own problem,” Holland told the students. “I try to maintain that personal commitment. In this case, stay committed to Rajeev, to finding him something, even if it is outside of the company.”
One undergraduate breakout group seesawed over whom to hire or fire while taking counsel from International Executive of the Year honoree Donald Soderquist, retired senior vice chairman of Walmart.
“Don’t compromise on hiring,” Soderquist advised. “If you’re hiring someone who is second best, then you’re making a bad decision. Many companies make that mistake at the point of hiring. When they hire the wrong person, they pay for it later on.”
As students and NAC members together debated what to do, the list of possible solutions piled up.
Some decided it would be best to pick up Brian and let Rajeev go. Others thought keeping Rajeev and giving him the tools to succeed was the right choice. Still others tried to find a way to keep everyone happy, opting to stay with Rajeev while justifying extra budget to hire Brian as a consultant.
Trevor Paulsen’s group decided to follow this route, with the possibility of hiring Brian full-time for the second, more complicated project phase.
“We felt that it was the manager’s responsibility to own up to his mistake,” said Paulsen, an MBA student. “Rather than immediately firing Rajeev, the manager needed to find a way to make it work with him on the team.”
Second-year MBA Marcelo Ribeiro agreed with this sentiment but added another caveat: “Maybe it’s better to keep our word to Rajeev, bring in Brian as well, and then take the risk of bringing the project in over budget and try to get it completed ahead of schedule. Hopefully, the client will be impressed that you brought in two people on the project.”
Finance major Paula Barrientos and her group decided the company’s top priority should be to produce the best results for shareholders.
“Putting myself in Rajeev’s position, if the company let me know what was going on and went out of its way to provide a compensation package while I looked for another job, I would be a lot more understanding,” she said.
Following the breakout discussions, six debrief sessions were team taught by twelve faculty members. Some students came away feeling pretty good about their ideas while others realized they hadn’t looked at the entire picture.
What Really Happened
In the final minutes of the debriefing sessions, discussion leaders divulged what actually happened in this real-life situation.
Fleet Technologies brought Rajeev in and put all the cards on the table. The hiring manager explained they didn’t believe he could handle the project’s second phase and that Brian was needed to make it work. The company gave Rajeev a severance package and paid for a lease he had signed on an apartment. Fortunately Rajeev had other options.
This is what the company did, but was it the right thing to do?
Weighing In - Here’s what a handful of participants had to say about the experience.
Fraser Bullock - Managing Director, Sorenson Capital
“I found the case experience very enlightening—it was a tough ethical dilemma in terms of deciding what is right and wrong. But the students were true to their values and what is important in life while also recognizing the business responsibility that is due.”
Donald Soderquist - Retired Senior Vice Chairman, Walmart
(Recipient, Marriott School’s 2010 International Executive of the Year Award)
“I was impressed with the students because they really wanted to do the right thing. They weren’t driven by financial reward. They wanted to be fair to both main players in the case. They tried to find ways to hire both of them. It’s important to remember that when you’re faced with tough decisions to find someone whom you can trust and rely on and get his or her point of view. It will help you think through the process.”
Jennifer Buzalewski - Senior Finance Major, South Carolina
“When I first read the case, I thought Rajeev would certainly be let go. I agreed with this decision because it seemed best for the company, but I did feel bad for Rajeev since he was likely excited to get the job, only to find out days later he was losing it. Still, I figured that was just business. Many of the NAC members expressed how they would work to help Rajeev any way they could. I respected their desire to help.”
Mark Russell - President, Worthington Steel, Worthington Industries
“The case fostered great discussions. One of the nice benefits for NAC members is seeing how students work through a dilemma. You pick out some of their strengths. We have students here with outstanding capability, and obviously it’s fun to interact with them. It gives me confidence in the future.”
Steven Thorley - H. Taylor Peery Professor of Finance
“One of the realizations I had while discussing the case is that with ethics, more than perhaps any other management topic, the key point is simply to talk through the hard decisions we have to make. Talking through the case emphasized that doing the right thing is important, and it hopefully increased our students’ willpower to do what they think is right under the pressure of the moment.”
Katie Fogle - Senior Accounting Major, Oregon
“The great thing was the ability to hear from professionals who have faced similar situations. They were able to provide feedback about different solutions I hadn’t originally thought of as well as bring more information about factors to consider, such as consequences to different stakeholders.”
Reed Maughan - Retired Partner, PricewaterhouseCoopers
“Most decisions that involve ethics are based on long-term issues: how they are going to impact the company’s business reputation and how they are going to affect your representation as a project manager. When you start to think long-term, the answers become pretty clear. The students tended to take an ivory tower point of view, and NAC members tended to take a business perspective; as we discussed the points everyone came to understand the issues.”
Lori Wadsworth - Assistant Professor of Public Management
“Our NAC members and alumni have often reminded us of the importance of teaching students not just the big headline ethics cases but, more important, discussing day-to-day ethics. This case is an example of something that students could very easily encounter in the workplace, but it also applies to students right now as they are in the process of job applications and interviews. They will need to decide how important their commitments, or promises, are to those they work with.”
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Article written by Todd Hollingshead
Photography by Jaren Wilkey
About the Author
Todd Hollingshead is a media relations manager for BYU’s University Communications. He graduated from BYU in 2004 with a BA in communications and worked as a journalist for the Salt Lake Tribune. He and his wife, Natalie, live in Orem with their two children.
