SOSC 111 - Science SOSC 111 - Science Technology and SocietyTechnology and Society

Today: Today: Lesson 17Lesson 17Ethics, Engineering and Business Ethics, Engineering and Business

October 30, 1998October 30, 1998

Dr. Vincent Duffy - IEEMDr. Vincent Duffy - IEEM

http://www-ieem.ust.hk/dfaculty/http://www-ieem.ust.hk/dfaculty/duffy/111 duffy/111

email: vduffy@ust.hkemail: vduffy@ust.hk 1

Overview for today

View videotape ‘Think before you leap’View videotape ‘Think before you leap’ segment 2: ‘Blowing the whistle’segment 2: ‘Blowing the whistle’ Discuss Rational TechniqueDiscuss Rational Technique Compare to the Ethics Plus ModelCompare to the Ethics Plus Model QOTDQOTD

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Questions of the Day Q1. What is the meaning of whistle blowing?Q1. What is the meaning of whistle blowing? Q.2. What is the difference between the ‘ETHICS-

PLUS model and the ‘Rational Technique’? Q.3. What is the significance of the sunshine test?

Why do we worry about company business being discussed openly since it is private?

Q.4. Who are the stakeholders in the Pepsi case? Who is at fault?

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rational technique

define the problemdefine the problem recognize the problem and collect informationrecognize the problem and collect information

consider the optionsconsider the options generate alternatives and comparegenerate alternatives and compare who benefits or suffers - how much?who benefits or suffers - how much?

make a decisionmake a decision select option based on conformity w/laws, code select option based on conformity w/laws, code

of ethics, etc.of ethics, etc. implement - think about what is missing?implement - think about what is missing?

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What would you do?

facts? Tang gave her promotion facts? Tang gave her promotion problem was brought to her attentionproblem was brought to her attention ethical issue? ethical issue?

‘‘whistle blowing’whistle blowing’

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What would you do?

alternatives?alternatives? conspire (to cheat) w/Alexconspire (to cheat) w/Alex pretend not to knowpretend not to know verify Alex claim about Tangverify Alex claim about Tang if false? consult w/Tang & senior managementif false? consult w/Tang & senior management if true? seek employment elsewhere &/or .…whistleif true? seek employment elsewhere &/or .…whistle

these actions by Alex/Tang can not survivethese actions by Alex/Tang can not survive ‘Sunshine test’‘Sunshine test’ if malpractices are discovered by public her career if malpractices are discovered by public her career

prospects will be poor both inside and outsideprospects will be poor both inside and outside companycompany

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What is the meaning of ‘whistle blowing’? whistle blowing is what someone might do to get the authority’s whistle blowing is what someone might do to get the authority’s

attentionattention to tell (in chinese)to tell (in chinese)

in the old days, policemen used to blow a loud whistle if they needed in the old days, policemen used to blow a loud whistle if they needed assistance from other policeassistance from other police

in the case of Sandra’s office, in the case of Sandra’s office, (Think before you leap-video)(Think before you leap-video)

money from a client account was used by her co-workers to trade securities for money from a client account was used by her co-workers to trade securities for their own benefittheir own benefit

Sandra was to decide whether or not to get the attention of ‘authorities’ Sandra was to decide whether or not to get the attention of ‘authorities’ either outside her company or in her company either outside her company or in her company

She was trying to decide whether or not to ‘blow the whistle’ to get the She was trying to decide whether or not to ‘blow the whistle’ to get the authorities attention authorities attention

What is missing from Rational Technique? Feedback- Feedback-

nothing built in to show that perception of the nothing built in to show that perception of the implementation by others will affect the implementation by others will affect the outcomeoutcome

remember sunshine test?remember sunshine test? can the decision stand the light of day?can the decision stand the light of day? can the issue be discussed openly and discussed can the issue be discussed openly and discussed

w/out problem?w/out problem?

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Recall: Ethics-Plus Model

ETHICS - Establish relevant factsETHICS - Establish relevant facts Take stock of ‘stakeholders’ involvedTake stock of ‘stakeholders’ involved Have assessment of positions & likely responsesHave assessment of positions & likely responses Identify viable alternativesIdentify viable alternatives Compare & evaluate consequences of alternativesCompare & evaluate consequences of alternatives Select appropriate course of actionSelect appropriate course of action PLUS - Professional conductPLUS - Professional conduct Legal requirementsLegal requirements Uncompromisable values eg. integrity, loyalty, honestyUncompromisable values eg. integrity, loyalty, honesty

Sunshine test - can the issue and decision be discussed openly?Sunshine test - can the issue and decision be discussed openly? 8

Q3. What is the significance of ‘sunshine test’?

Why do we worry about company business Why do we worry about company business being discussed openly, since it is private? being discussed openly, since it is private?

Though the matters are private (company), Though the matters are private (company), it should be considered how the public would react it should be considered how the public would react

if they find out the actions, because if they find out the actions, because it is possible that someone will find out it is possible that someone will find out maybe by chancemaybe by chance maybe from a ‘whistle blower’ or maybe from a ‘whistle blower’ or maybe just newspapers asking questionsmaybe just newspapers asking questions

New caseNew case

Today: discuss Pepsi Today: discuss Pepsi science technology and societyscience technology and society a ‘computer problem’ causes a situation where a ‘computer problem’ causes a situation where

a difficult decision has to be madea difficult decision has to be made

ex. Pepsi Cola-Philippines sales have been running a distant 2nd to Cokesales have been running a distant 2nd to Coke Pepsi launched ‘Number Fever’ campaign in Feb.92. Pepsi launched ‘Number Fever’ campaign in Feb.92.

Numbers printed on the underside of cap and winning Numbers printed on the underside of cap and winning numbers announced each daynumbers announced each day

Prizes up to $1M pesos, $300k HKDPrizes up to $1M pesos, $300k HKD Ads in newspapers, radio, TV, saying ‘today you could Ads in newspapers, radio, TV, saying ‘today you could

be a millionaire’ be a millionaire’ Promotion successful, extended 5 more weeksPromotion successful, extended 5 more weeks most won 100 pesos ($30HKD)most won 100 pesos ($30HKD)

Victoria Angelo, unemployed mother of 5, Victoria Angelo, unemployed mother of 5, lives w/family in tin-roofed shack in Manilalives w/family in tin-roofed shack in Manila

husband, Juanito, earns $30husband, Juanito, earns $30HKDHKD/ day/ day began drinking pepsi, every meal, snackbegan drinking pepsi, every meal, snack each day prayed to get winning numbereach day prayed to get winning number gather around small TV w/neighbors to seegather around small TV w/neighbors to see May25, #349 flashed winnerMay25, #349 flashed winner

‘‘we are a millionaire’ to children ‘you can finish we are a millionaire’ to children ‘you can finish school and go to college’ to husband ‘you can buy school and go to college’ to husband ‘you can buy passenger jeep’ to self ‘we can buy a real house’ passenger jeep’ to self ‘we can buy a real house’

a dream come truea dream come true unfortunately, Pepsi realized mistake, thousands of unfortunately, Pepsi realized mistake, thousands of

people were demanding paymentpeople were demanding payment realizing the mistake could cost Billions of $realizing the mistake could cost Billions of $ Pepsi refused to payPepsi refused to pay

Riots broke out, Pepsi delivery trucks were Riots broke out, Pepsi delivery trucks were stoned, torched, overturnedstoned, torched, overturned

homemade bombs were thrown at Pepsi homemade bombs were thrown at Pepsi plants and officesplants and offices

in one case, fragmentation grenade tossed at in one case, fragmentation grenade tossed at a parked Pepsi truck bounced off trucka parked Pepsi truck bounced off truck

killed 5 year old girl, schoolteacher and killed 5 year old girl, schoolteacher and wounded otherswounded others

The violence frightened the company officials and The violence frightened the company officials and they offered then $50 HKD to the winners they offered then $50 HKD to the winners

more than 480,000 winners claimed the prizemore than 480,000 winners claimed the prize if paid in full more than $50Billion HKDif paid in full more than $50Billion HKD Violence resulted in 30 burned trucks, 6000 people Violence resulted in 30 burned trucks, 6000 people

filed civil suit for damagesfiled civil suit for damages 5000 criminal suits charging fraud (false advertising)5000 criminal suits charging fraud (false advertising) Pepsi claimed it was started by a ‘computer error’Pepsi claimed it was started by a ‘computer error’

QOTD - Q4 - Pepsi a ‘computer problem’

In the Pepsi case, who are ‘stakeholders’? Were any ethical principles violated? Was Pepsi justified? What should they have done differently? When? Would the result have been similar or

different in Hong Kong?