UNIVERSITY CANADA WEST

Bhumika Gandhi
(Group Member – Mamta Minhas)
Student ID – 2101003
Mid-Term Exam
BUSI 601: Ethics, CSR, and Business
Environment
BON-SUMMER 23
Dr. Aigerim Shilibekova
 FIRST DRAFT

Case Study Overview

The electronic industry is comprised of multiple sectors and organizations that manufacture, design, and
assemble electrical and electronic products. There are companies which produce, design, manufacture,
assemble and test the electronic components for the original equipment manufacturers (OEM).

This case study analysis evaluates the behaviour of an employee (Sanjay) who is working in an electronic
manufacturing service company (EMS) towards the high-stake customer (OEM). Sanjay works for a
company that manufactures high-end batteries for the electronic manufacturing company (OEM).

The client placed a large order with Sanjay for these batteries and he has promised them the four-week
delivery. Due to the shortages in the supply chain, there is a possibility that the delivery might be delayed.
However, Sanjay is thinking to not to disclose this information to the customer until he has more specific
details about the shipment. Also, he still believes that the deadline would be met.

Given this situation, a very important question has risen –

1. Is that the right thing to do? If not, what should he do?

In this report, ethical aspects of Sanjay’s decision, importance of the customer as a stakeholder will be
discussed.

Stakeholder Analysis

The internal and external environment of the business includes the internal and external stakeholders of
the organization respectively. A stakeholder is an individual, group of people or an organization that has
stakes in an organization and can positively or negatively affect or be affected by its actions. Stakeholder
Analysis is a technique or a tool to identify, understand and prioritize the needs and expectations of all
the stakeholders who may influence or get influenced by the organizational activities (Grégoire, 2019).

Customers are considered as the external stakeholders of the company. In line with the case study, this
client can be mapped on the Stakeholder Matrix (also known as Importance/Influence matrix) as of high
importance and high influence.

The revenue of the company is generated by the customers. They expect a quality experience and good
value for money. Therefore, customers play a crucial role in the growth of the organization.

Corporate Disclosure

As mentioned in the case study, the client called Sanjay to confirm if the delivery would be timely or not
as they would need to shut down the assembly line if it gets late. As an employee, considering the
customer’s interest, Sanjay is in a dilemma if he should inform the customer about the delivery timeline
or wait until he has more shipment information. Sanjay’s decision would highlight his attitude towards
the customer and loyalty towards the reputation of the company.
According to Newman (2016), “Employee attitude would ‘touch’ and reflect in every transaction and
interaction between customers and your company. Positive employees would know that providing great
customer service is not just about being courteous and polite but extends to cover many different realms”.

Irrespective of the result, companies must disclose both the good and bad information.

Madhani (2008) defines corporate disclosure as "to communicate information about firm's performance
and value to public, outside investors and other stakeholders". Effective and full disclosure indicates how
transparent the organization is with its stakeholders. It is the responsibility of all the organizations to
provide and disclose all the relevant information that can affect their decision-making.

Business Ethics

Business Ethics can be defined as the moral principles based on which any business operates. Horton
(2020) explains that “The system of moral and ethical beliefs that guides the values, behaviors, and
decisions of a business organization and the individuals within that organization is known as business
ethics”.

Customer loyalty and trust is of utmost importance for all types of businesses. An organization who has a
well-defined business ethic system, faces less legal troubles. Sanjay should be open and transparent with
the client about all the information. If the delivery gets late, it will highly impact the client, and that will
not be good for the company’s public reputation.

Approaches to Ethical Decision Making

Ethical decision making is the process of evaluating the consequences and choosing the best alternative
considering the ethical and moral aspects. The approaches that apply to this case are –

The Rights Approach

This approach signify that humans have the rights to make their choices freely and they have moral right
to have these choices respected. After analyzing the case as per this approach, if Sanjay does not share
the delivery update with the client, it would violate client’s individual rights. These are –

• The right to the truth – It would be a misleading promise for the client, if Sanjay is not truthful
about the delivery information from the manufacturing department.

• The right to what is agreed – When the client placed the huge order, Sanjay promised them four-
week delivery. Therefore, it becomes necessary for him to share all the information with the
customer as to keep them updated regardless of the consequences.

• The right to choose – The client has the right to make their own choice and take decision after the
interaction with Sanjay. Sanjay should give the liberty to the customer to decide what they want
to do if the delivery do get late.

• The right to be informed – When the client called Sanjay about the delivery timeline, the
mentioned that they would need to put the assembly line on hold if the delivery is going to be
delayed. Sanjay should consider the impact while making his decision to not disclose the
information.
Constructive Feedback from Mamta Minhas (2026844)
I would say you have written an excellent report. You have very well explained the key functions
in the electronics industry. I like the way you have mentioned about the importance of
employee’s attitude for the effective functioning of the organization. Certainly, employee/owner
attitude does affect the way they treat customers. Organizations having good attitude employees
would ensure a happy and loyal customer/client base which would result in more business and
higher expenditures from customers for their services or products. Employee or business owner
should always be truthful to their clients because they reflect the values of their organization in
everything that they do. Here in this case study, instead of hiding the truth from his client, Sanjay
should discuss the issues of shortages in supply chain(logistics) with his client because as a
stakeholder client has a legal right to know about the status of delivery for the order and it is
ethical to do so.

According to Right approach, people are not merely object, they have inherent dignity based on
their ability to choose freely and have fundamental right to have these choices respected. Thus,
by not sharing the actual status of delivery of the consignment, Sanjay will be violating client’s
moral rights. Here Sanjay’s action would not treat the client with dignity and respect.

According to me, Virtue approach could also have been applied in this case. This approach can
help Sanjay to act according to the highest potential of his character and would let him strive
towards virtues such as honesty, integrity, and courage. Also, I would suggest you add structured
recommendation as an ethical officer in the end of your report.

Overall, you have written an impressive report. You have clearly and concisely explained the
importance of stakeholder analysis and corporate disclosure which is extremely important for
organization to do so. I hope you find my suggestions helpful. Please feel free to contact me
through teams or email if you have queries related to my feedback.
 FINAL DRAFT

Case Study Overview

As per the case study, one of the high value customers (an electronic manufacturer) placed a large order
with Sanjay for the high-end batteries and he has promised them four-week delivery. Due to the shortages
in the supply chain, there is a possibility that the delivery might be delayed. However, Sanjay thinks that
he should not tell the customer about the delay until he has more specific information about the
shipment, as he still believes that the deadline will be met.

Given this situation, a very important question has risen –

1. Is that the right thing to do? If not, what should he do?

In this report, ethical aspects of Sanjay’s decision, and my recommendations as an ethics officer will be
discussed.

Importance of Business Ethics

Horton (2020) explains that “The system of moral and ethical beliefs that guides the values, behaviors,
and decisions of a business organization and the individuals within that organization is known as business
ethics”. Amidst growing economy and new challenges, it’s crucial for every organization to act ethically.
The employees must understand the importance of business ethics as their decisions impact the
organizational performance and growth.

Customer loyalty and trust is of utmost importance for all types of businesses. An organization that has a
well-defined business ethic system, faces less legal troubles. Sanjay should be open and transparent with
the client about all the information. If the delivery gets late, it will highly impact the client, and that will
not be good for the company’s public reputation.

Approaches to Ethical Decision Making

Ethics play important role in any decision-making process. Ethical decision making is the process of
evaluating the consequences and choosing the best alternative considering the ethical and moral aspects.
The approaches that apply to this case are –

The Rights Approach

The above-mentioned approach signify that humans have moral rights to make their choices freely and
have those choices respected. If we analyze the consequences of Sanjay’s decision as per this approach,
Sanjay should share the delivery update with the client. Else, it would lead to the violation of client’s
individual rights as follows –
 • The right to the truth – It’s a misleading promise to the client, if Sanjay does not disclose the
delivery update from the manufacturing department even though he believes that the deadline
would be met.
• The right to what is agreed – When the client placed the huge order, Sanjay promised them four-
week delivery. Therefore, it becomes necessary for him to share all the information with the
customer as to keep them updated regardless of the consequences.

• The right to choose – The client has the right to make their own choice and take a decision after
the interaction with Sanjay. If the delivery gets late, customer should have the liberty to decide
the next step even if it is cancellation of the order.

• The right to be informed – The customer is on a call with Sanjay to confirm the delivery timeline
because they would need to put the assembly line on hold if the delivery is going to be delayed.
Sanjay should consider how his decision, to not disclose information, would impact the customer
and reputation of the company.

The Virtue Approach

In accordance with the Virtue Approach, ethical decisions and actions are the ones that align with the
virtue or moral character of an individual (virtue refers to human personality traits like integrity, loyalty,
dedication, patience, etc.). The ethical decision taken based on this approach indicate how the person is
or how they want to be.

Supposedly, Sanjay has an open communication with the customer about the delivery update, it would
not only reflect his honesty and perseverance but also, highest potential of his character. The virtue
approach is also referred as character-based approach.

According to Meera (1996), “A complete understanding of professional ethics includes a cognitive grasp
of principle and virtue ethics, which can be integrated into professional decision making, to result in better
ethical practice”.
Recommendations –

As an ethical officer, my recommendation for Sanjay is to build trust, be transparent and have an open
communication with the customer to avoid any conflict of interest and strengthen the relationship with
the customer.

Customers are considered as the most important stakeholders of the company. A stakeholder is an
individual, group of people or an organization that has stakes in an organization and can positively or
negatively affect or be affected by its actions. The importance of customer as a stakeholder is explained
below –

Stakeholder Analysis

Stakeholder Analysis is a technique or a tool to identify, understand and prioritize the needs and
expectations of all the stakeholders who may influence or get influenced by the organizational activities
(Grégoire, 2019).

Customers are considered as the external stakeholders of the company. In line with the case study, this
client can be mapped on the Stakeholder Matrix (also known as Importance/Influence matrix) as of high
importance and high influence.

The revenue of the company is generated by the customers. They expect a quality experience and good
value for money. Therefore, customers play a crucial role in the growth of the organization.

Corporate Disclosure

Madhani (2008) defines corporate disclosure as "to communicate information about firm's performance
and value to public, outside investors and other stakeholders". Effective and full disclosure indicates how
transparent the organization is with its stakeholders. It is the responsibility of all the organizations to
provide and disclose all the relevant information that can affect their decision-making.

Irrespective of the consequences, companies must disclose both the good and bad information.

According to Newman (2016), “Employee attitude would ‘touch’ and reflect in every transaction and
interaction between customers and the company. Positive employees would know that providing great
customer service is not just about being courteous and polite but extends to cover many different realms”.

Sanjay’s decision would highlight his attitude towards the customer and loyalty towards the reputation of
the company.
References –

Newman. E. (2016, January 10). Employee Attitude Affects Customer Behaviour. Yonyx.
https://corp.yonyx.com/customer-service/employee-attitude-affects-customer-behaviour/

Grégoire. P. (2019, September 11). Stakeholder Analysis: Definitions, Tools and Techniques. Borealis.
https://www.boreal-is.com/blog/what-is-stakeholder-analysis/

Madhani. M. P. (2008). Corporate Disclosure: Concepts And Practices. Research Gate.

https://www.researchgate.net/publication/45072531_Corporate_Disclosure_Concepts_And_Practices

Horton. M. (2020, July 1). The Importance of Business Ethics. Investopedia.

https://www.investopedia.com/ask/answers/040815/why-are-business-ethics-important.asp

Meara, N. M., Schmidt, L. D., & Day, J. D. (1996). Principles and virtues: A foundation for ethical decisions,
policies, and character. The Counseling Psychologist, 24(1), 4–77.
https://doi.org/10.1177/0011000096241002

CASE PREPARED BY KIRK O. HANSON, MARKKULA CENTER FOR APPLIED ETHICS, SANTA CLARA
UNIVERSITY, USA