A case study is a comprehensive and in-depth examination of a particular subject, often within its real-life context. It serves as a methodological tool to explore, analyze, and understand complex issues or phenomena, ranging from individual experiences to organizational challenges. Typically employed in various academic disciplines, business settings, and scientific research, a case study involves an extensive investigation that aims to provide a detailed account of the subject under scrutiny. By delving into the intricate details of a specific case, researchers can uncover valuable insights, draw conclusions, and offer practical solutions. This method offers a holistic approach, allowing for a nuanced understanding of the multifaceted factors influencing the subject, making it an invaluable tool for gaining knowledge and informing decision-making processes.
Q7. Prabhat was working as Vice President (Marketing) at Sterling Electric Ltd., a reputed multinational company. But presently the company was passing through the difficult times as the sales were continuously showing a downward trend in the last two quarters. His division, which hitherto had been a major revenue contributor to the company’s financial health, was now desperately trying to procure some big government order for them. But their best efforts did not yield any positive success or breakthrough.
His was a professional company and his local bosses were under pressure from their London-based HO to show some positive results. In the last performance review meeting taken by the Executive Director (India Head), he was reprimanded for his poor performance. He assured them that his division is working on a special contract from the Ministry of Defence for a secret installation near Gwalior and tender is being submitted shortly.
He was under extreme pressure and he was deeply perturbed. What aggravated the situation further was a warning from the top that if the deal is not clinched in favour of the company, his division might have to be closed and he may have to quit his lucrative job.
There was another dimension which was causing him deep mental torture and agony. This pertained to his personal precarious financial health. He was a single earner in the family with two school-college going children and his old ailing mother. The heavy expenditure on education and medical was causing a big strain to his monthly pay packet. Regular EMI for housing loan taken from bank unavoidable and any default would render him liable for severe legal action.
In the above backdrop, he was hoping for some miracle to happen. There was sudden turn of events. His Secretary informed that a gentleman Subhas Verma wanted to see him as he was interested in the position of Manager which was to be filled by him in the company. He further brought to his notice that his CV has been received through the office of the Minister of Defence.
During interview of the candidate-Subhash Verma, he found him technically sound, resourceful and experienced marketeer. He seemed to be well-conversant with tendering procedures and having knack of follow-up and liaising in this regard Prabhat felt that he was better choice than the rest of the candidates who were recently interviewed by him in the last few days.
Subhash Verma also indicated that he was in possession of the copies of the bid documents that the Unique Electronics Ltd. would be submitting the next day to the Defence Ministry for their tender. He offered to hand over those documents subject to his employment in the company on suitable terms and conditions. He made it clear that in the process, the Sterling Electric Ltd. could outbid their rival company and get the bid and hefty Defence Ministry order. He indicated that it will be win-win situation for both-him and the company.
Prabhat was absolutely stunned. It was a mixed feeling of shock and thrill. He was uncomfortable and perspiring. If accepted, all his problems would vanish instantly and he may be rewarded for securing the much awaited tender and thereby boosting company’s sales and financial health. He was in a fix as to the future course of action. He was wonder-struck at the guts of Subhash Verma in having surreptitiously removing his own company papers and offering to the rival company for a job. Being an experienced person, he was examining the pros and cons of the proposal/situation and he asked him to come the next day.
(a) Discuss the ethical issues involved in the case.
(b) Critically examine the options available to Prabhat in the above situation.
(c) Which of the above would be the most appropriate for Prabhat and why? (Answer in 250 words) 20
ANSWER
Ethical issues involved in the case are:
- Misuse of confidential information: Subhash Verma has obtained copies of bid documents that Unique Electronics Ltd. would be submitting to the Defence Ministry. He has offered to hand over those documents to Sterling Electric Ltd. if he is given a job in the company. This is a clear case of misuse of confidential information, which is unethical.
- Conflict of interest: Prabhat is in a position of power as Vice President (Marketing) of Sterling Electric Ltd. He has a duty to act in the best interest of the company. However, his personal financial problems and pressure from his bosses are clouding his judgment. This conflict of interest is unethical.
- Bribery: Subhash Verma has offered to hand over the bid documents subject to his employment in the company on suitable terms and conditions. This is a form of bribery, which is unethical.
- Unfair competition: If Sterling Electric Ltd. accepts the bid documents and uses them to outbid Unique Electronics Ltd., it would be unfair competition. This would harm the reputation of Sterling Electric Ltd. and damage its relationship with Unique Electronics Ltd.
Prabhat has the following options:
- Accept the offer: Prabhat can accept Subhash Verma’s offer and use the bid documents to outbid Unique Electronics Ltd. This would solve his financial problems and help Sterling Electric Ltd. win a big government order. However, this option is unethical as it involves misuse of confidential information, conflict of interest, bribery, and unfair competition.
- Reject the offer: Prabhat can reject Subhash Verma’s offer and report him to the authorities. This would protect the interests of Sterling Electric Ltd. and maintain its reputation. However, this option may not solve Prabhat’s personal financial problems and may lead to the closure of his division.
- Negotiate with Subhash Verma: Prabhat can negotiate with Subhash Verma to obtain the bid documents without offering him a job in the company. This would solve his financial problems and help Sterling Electric Ltd. win the government order. However, this option may still be unethical as it involves misuse of confidential information and unfair competition.
- Resign from the job: Prabhat can resign from his job at Sterling Electric Ltd. and find another job that does not involve unethical practices. This would protect his personal integrity and avoid any legal or ethical consequences. However, this option may not solve his financial problems and may affect his career prospects.
The most appropriate option for Prabhat would be to reject the offer made by Subhash Verma and report him to the authorities. This would protect the interests of Sterling Electric Ltd. and maintain its reputation. Prabhat should also disclose the conflict of interest and personal financial problems to his bosses and seek their support. He should explore other ways to solve his financial problems without compromising his personal and professional integrity. This option may not be easy, but it is the right thing to do from an ethical perspective.
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