Question

Case Study: Engineering Ethics in a Technology Startup

Introduction

A business’s reputation and brand name depend upon the behavior and values of that
business. Businesses should be socially responsive, fair and just, with a positive
reputation for business conduct. Engineering entrepreneurs must confront ethical
challenges such as engineering design reliability and salespeople’s ethical standards.
Ethical decisions in sales include: intentionally misrepresenting a faulty product,
economic tradeoffs, short-term v. long-term gain. In general, a company’s beliefs and
values matter, along with business conduct and the representation of facts to customers
and investors.
This case study attempts to identify the specific ethical issues and obligations of an
entrepreneur and his employees in making decisions for his startup company.
The Case
Tina is a new hire at a startup company that produces very expensive security cameras
primarily for large organizations. Tina is hired to engineer and troubleshoot
malfunctioning cameras.
One day, one of its Fortune 500 customers reported to Tina that a number of the cameras
out of its last big shipment were not functioning properly. The customer also informed
Tina that the serial and revision numbers on these units were different from the rest of the
units.
Tina’s technicians inspected the cameras. Based on the results of their inspection, Tina
realized that her company sold units that were from a bad batch. Tina wanted to tell the
customer why the units failed but recognized that if she disclosed this information, the
customer would be eligible to receive replacement units at no additional cost. On the
other hand, if she blamed the failing units on something else, such as improper care, her
company would be able to charge the customer for replacement units.

As a recent hire, Tina decided to discuss the case with David, the owner of the startup.
David told her that she should minimize his company’s losses. Tina is concerned with her
job security. But she also wanted to be honest with this major customer.

Questions:
1. What are the ethical issues in this case?
2. Who are the actors and what is their obligation in this case?
3. Would the issue in the case have occurred if the actors followed the IEEE code of
ethics (https://www.ieee.org/about/corporate/governance/p7-8.html)?
4. What sections of the IEEE code of ethics would have been relevant in this case?
5. Should Tina’s personal beliefs play a role in this case? What about the personal beliefs
of David?
6. What should Tina do? Does she have a moral obligation to obey or disobey the owner?
Why?

Answer 1

1) An ethical issue in this case is selling faulty machines to the customer presenting them as good ones. Quality of Product is the ethical issue involved here.

2) Actors in this case include the faulty product, Tina, Tina’s Technicians and the owner of the startup David. Their obligation is to sell a product with good quality.

3)  No, If the actors followed the IEEE code of ethics have been followed this would not have occurred as the point 9 in IEEE code says to avoid injuring others, their property, reputation, or employment by false or malicious action. But here Tina’s company sold faulty products to the customer.

4) a) Point 3 of the IEEE code

To be honest and realistic in stating claims or estimates based on available data

b) Point 9 in IEEE code

To avoid injuring others, their property, reputation, or employment by false or malicious action

5) Tina’s personal belief can play a role in this case if she assumes the non- functioning of camera due to improper care by the customer in order to charge the customer for replacement units.

David’s personal belief also comes to play a role if he believes Tina’s personal belief that the non- functioning of camera is due to improper care by the customer.

6) Tina has done the correct thing by talking to the owner and also she should accept the responsibility of replacing the faulty products with the customer without charging them.

There is a moral obligation to disobey the owner as per Point 9 and 3 in IEEE code which state as follows:

a) To avoid injuring others, their property, reputation, or employment by false or malicious action there is a moral

b) To be honest and realistic in stating claims or estimates based on available data.