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Ethics In Management And Planning

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U.S. corporations have had lofty ethical codes for many years. Framed documents describing ethical conduct were hand-scripted and hung on the office for all to see. The truth is, the only person who probably read this ethical code was the cleaning person charged with periodically dusting the frame.

Times have changed. Ethical issues have brought corporate giants to their knees and Sorbanes-Oxley has brought many corporate boards to the alter of ethical conduct. Some would consider ethics to be the code by which value systems are prioritized. Business ethics, then, is, "The branch of ethics that examines ethical rules and principles within a commercial context; the various moral or ethical problems that can arise in a business setting, and any special duties or obligations that apply to persons who are engaged in commerce." (, 2005).

Corporations have begun incorporating ethics into many business activities, including management planning. Various ethical systems can be used to define the question "Is our conduct ethical?" However, even with the current dialogue regarding ethical behavior the question for many continues to be "Is our conduct legal?" The difference between ethical and legal behavior lies partially in the underlying ethical system used to determine ethical values. This interface between different ethical systems is one of the areas in which the current conflict in business ethics is taking place.

Managers working in the medical device industry, like managers in most areas of business, are faced with ethical decisions on a daily basis. The fact that people's lives may be involved, as opposed to their financial resources, makes the results of these decisions critical. This is easy to remember for a middle manager who has daily conversations with patients and practitioners, but removed from the daily activity of an executive. Bateman and Snell describe various ethical systems that are used to analyze ethical questions and determine appropriate actions (Bateman and Snell, 2005). Ethical conflicts can arise when different ethical systems are used to address ethical questions.

A recent incident brought this ethical conflict to the forefront as I was forced to adjudicate the "correctness" of applying two ethical systems to address an urgent ethical issue. I was approached by members of the mid-level production and quality groups with an urgent matter. A problem on a production line caused one of the production line components to degrade. As the degradation occurred, material from the degrading component was found in the final product. The component was originally qualified to be inert and non-toxic, but, none the less, was not suppose to be in the final product. Production was brought to a halt while the problem was investigated. I was not informed of the problem until day three of the investigation. The final product has a high-margin and a fast turnover. The product rarely stays in the warehouse for longer than one week. As the investigation continued, the safety stock of product in the warehouse began to approach the critical "panic" level.

One lot of product was put on hold and a 100% visual inspection was conducted. A small number of containers of product were found to contain pieces of the degraded component, but the vast majority of the lot appeared to be acceptable. As the warehouse stock dwindled action had to be taken or customers would be backordered. The production and mid-level quality team lobbied heavily to release the product since it passed visual inspection and met the release criteria. When I approached the general manager with the situation, it was obvious that both he and the mid-level quality group were using the same ethical system; relativism. The foundation of relativism is the opinion of experts. Persons using this system distance themselves from the actual ethical decision. The response of the general manager was, "The quality group is responsible for decisions such as this. They have the expertise and the resources. If the quality group says that the product is safe to use then it should be released."

The quality group lobbied heavily to release the product but would not do so without the approval of the clinical group. Both the general manager and the mid-level quality group clearly approached the ethical decision as relative; it is ethical to use the product if the quality group says that it is safe, and it is ethical to use the product if the clinical group says that it is safe.

As head of the clinical group, I approached the question using a different ethical system. I considered that even if the product complied with the current release requirements, there were unknown



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