Ethical Decision-Making in Management: Case Studies on Responsibility

This case study delves into two significant ethical dilemmas faced by managers. The first case explores the termination of a colleague, analyzing the ethical implications of informing or not informing the employee, and applying Kantian ethical theory to determine the best course of action. The second case examines the Ford Pinto situation, where a design flaw led to safety concerns, and analyzes the ethical dilemma of whether to redesign the fuel tank, using Utilitarianism to evaluate the consequences of each decision. The analysis considers the stakeholders involved, the potential outcomes, and provides recommendations based on ethical frameworks to guide responsible decision-making in challenging managerial situations. The study references relevant academic sources to support the analysis.

Manager social
Responsibility

Table of Contents
CASE 1 : Termination of a Colleague and Friend...........................................................................1
Ethical issues – Who is the decision maker and what are competing pressure they are facing. 1
Ethical Dilemma .........................................................................................................................1
Kantianism..................................................................................................................................1
Consequences of informing Lee about his termination ..............................................................2
Consequences of not informing Lee about his termination .......................................................2
Kantianism calculation ...............................................................................................................2
Recommendation.........................................................................................................................2
CASE 2 : The FORD Pinto – An Amazing True Story!..................................................................3
Ethical issues (Who is the decision maker, and what competing pressures they are
experiencing)...............................................................................................................................3
Ethical Dilemma .........................................................................................................................3
Utilitarianism : ...........................................................................................................................3
Consequences of investing or redesigning the new fuel tank ....................................................3
Consequence of not recalling and redesigning the car ...............................................................4
Utilitarian calculation .................................................................................................................4
Recommendation.........................................................................................................................4
REFERENCES................................................................................................................................5

CASE 1 : Termination of a Colleague and Friend.
Ethical issues – Who is the decision maker and what are competing pressure they are facing.
As a Human resource manager for information Systems (IS) Department at BMI Industries, I am
responsible for coordinating employee termination. This job responsibility has developed an
ethical dilemma for the termination of Lee. According the situation I need to choose among the
two alternatives which is very difficult and undesirable. The two choices I have to face are as
mentioned below -
1. Inform Lee about his termination, but it can risk my job as the information regarding
termination is very confidential(Abrams and et.al, 2014).
2. Not informing Lee about his termination, and It will affect our friendship.
Ethical Dilemma
The Ethical Dilemma which is faced by me is -
“To inform Lee about his termination” OR “Not to inform Lee about his termination”
I am facing two critical situations due to the ethical dilemma, one will lead to a
punishment which can affect my job or career in the company. Another situation of choice can
affect Lee and my relationship which is also a major loss. Lee is my close friend I do not want
him to suffer and break relation with me, on the other I also don't want to lose my job.
Kantianism
The Kantian ethical theory is otherwise called Deontological Ethics which for the most part
converts into Dury Ethics, a basic component which should be considered is that as per this
hypothesis every single individual ought to be dealt with as a closures and never as a
means(Bjelica and et.al, 2016).The Kent theory of moral commitments expresses a man ought to
make the best choice which is appropriate for his obligation yet it is correct just in the event that
he or she isn't getting reward for doing that specific thing or act. As indicated by the Kentianism
parties engaged with the moral quandary are as following -
 Myself
 Lee
 BMI industry
Consequences of informing Lee about his termination
The major consequence of informing Lee about his termination is that it is against
regulations of the company and I may face strict punishment for this. It is not at all acceptable by
1

the company that I share termination information with employees. I may also get terminated
from the company for sharing confidential information with an employee. They can also take
legal action against me.
Consequences of not informing Lee about his termination
In a case I do not inform Lee about the termination, he will sell his house and buy the
new one which is very costly. Lee thinks that his job is secure and due to this he planned to buy a
new house. If in case I do not tell him that he is going to be terminated he will not be able to save
his house and without job it will be difficult for him to buy the new house. It will affect our
friendship and he may break all the relations with me. I will be treated as a selfish person
because I got the job with Lee's support(Gibson and et.al, 2017).
Kantianism calculation
After conducting Kentianism analysis it is concluded that the ethical dilemma option that
is providing maximum good for is to inform Lee about his termination. If I inform Lee that the
company is terminating him, he will appropriately take decision about selling and buying house.
The Kantianism theory states that an individual should do his duty, Lee is my close friend and
it's my duty to make him aware of problem he might face due to the termination. In order to keep
Lee and his family away from a great loss it is necessary to inform him about the termination. It
is very important for Lee to get prepare for the termination, find a new job and postponed selling
his house and buying the new one.
Recommendation
According to the above analysis it is easy to understand that I should choose to inform
Lee about his termination as planned by the company. In order to save myself from punishment I
will rather inform his wife who is also my friend. It is important to stop him from selling his
house as it is a big decision that Lee made just because of his job. It is not sure that I wont get
punished by my employer or the company, but as analysed by Kentianism it is my duty to inform
him. The company is not getting any harm from this so it should be taken as a breach of
regulation as well as help my friend to overcome this problem.
2

CASE 2 : The FORD Pinto – An Amazing True Story!
Ethical issues (Who is the decision maker, and what competing pressures they are experiencing).
Ford motors are facing a great issue or problem regarding their newly launched a car
named Pinto which is catching fire and people are getting injured. The major reason of this issue
was found out to be the fuel tank of the cars, In order to resolve this issue company identified
that they can redesign the fuel think of the cars. The customers are getting harmed and even
losing their lives due to the low quality of the fuel tank. Due to this, an ethical dilemma is
developed with this situation. This dilemma provides two choices for the company which are as
mentioned below -
 Ford should invest in redesigning the fuel tank
 For should not invest in redesigning the fuel tank
Ethical Dilemma
The Ethical Dilemma faced by Ford motors is
“To redesign the fuel tank or
“Not to redesign the fuel tank”
Ford motors are facing two kinds of situations in this ethical dilemma, if they recall the Pinto and
redesign its fuel tank it will increase their cost of production. On the other side if they do not
recall or redesign Pinto it can harm many people or customers using the car (Mistry and et.al,
2015).
Utilitarianism:
To conduct a Utilitarian analysis, the first step needs to be performed is the identification of
various parties involved or getting affected by the decision maker directly or indirectly. The
various parties involved in this case are -
 Ford motors
 Customers
 Stakeholders
 Competitors
 Capital partners or investors
3

Consequences of investing or redesigning the new fuel tank
The major consequence for Ford motors is that redesigning car's fuel tank will affect cost
efficiency of the company. The major consequence of redesigning Pinto is increment in the cost
of the company and it will directly affect the price of cars. It will consume a lot of time and
resources for redesigning the cars. The other consequence of redesigning cars is to clearly
represent that Pinto's design was not up to the mark which will greatly affect the company's
reputation and brand image (Little and et.al, 2018).
Consequence of not recalling and redesigning the car
The Pinto car by Ford is not properly designed, the fuel tank of the car is highly flammable. Due
to this many incident have happened already harming and killing few people. Therefore, it is an
ethical issue or problem faced by the company which is to harm their customers (Sims and et.al,
2016). Another major consequence Ford can face is the bad market image and reputation, people
already started developing negative brand image for Ford due to Pinto which resulted in decline
in profitability of the company.
Utilitarian calculation:
The Utilitarian analysis concluded that Ford motors should select option of recalling and
redesigning Pinto, it can help the company to gain trust and loyalty of the existing customers as
well as support them to attract new customers in the market. The theory of Utilitarian can help
Ford to increase their sales as well as profitability of the company (Wachs and et.al, 2018). A
Utilitarian may look at this case of Ford motors from different perspectives, depending upon
individual thinking on what would develop “the good or greatest happiness for the highest
number of individuals”. From the perspective of the company the greatest good can be produced
by maximizing profit and reducing cost as it will help in manufacturing cars at lower price as
compared to producing cars with safety concerns or redesigning the existing ones. On the other
hand it is observed by customers as well as Ford themselves that avoiding safety concerns can
harm a lot of people and even be the reason of their death. Hence, the good can be the greatest if
company redesign Pinto, if they will offer high quality products to the customers their sales will
increase and it will directly enhance their profit.
4

Recommendation:
According to the Utilitarian analysis, it can be concluded that Ford motors should focus on
redesigning the fuel tanks of Pinto cars. Redesigning the cars wont cost too much to the
company, whereas if they avoid this issue many customers can get harm. In order to develop a
positive image and brand value in the market Ford can effectively change their car designs. The
company needs to invest $5.08 (including purchase and installation cost of the bladder) on each
car to change the fuel tank design and reduce the harm of catching fire. According to the
Utilitarian theory maximize the greatest good for the greatest number affected by given
decision/action. Taking care of the customers can assist the company to increase their sales by
attracting new customers.
5

REFERENCES
Books and Journals
Wachs, M., 2018. Ethical dilemmas in forecasting for public policy. In Classics Of
Administrative Ethics (pp. 102-114). Routledge.
Little, D., 2018. The paradox of wealth and poverty: Mapping the ethical dilemmas of global
development. Routledge.
Bjelica, D., Gardašević, J., Vasiljević, I. and Popović, S., 2016. Ethical dilemmas of sport
advertising. Sport Mont, 14(3), pp.41-43.
Abrams, D.C., Prager, K., Blinderman, C.D., Burkart, K.M. and Brodie, D., 2014. Ethical
dilemmas encountered with the use of extracorporeal membrane oxygenation in
adults. Chest,145(4), pp.876-882.
Gibson, A.M., 2017. Ethical Dilemmas and Challenges.
Mistry, J., Berardi, A., Bignante, E. and Tschirhart, C., 2015. Between a rock and a hard place:
ethical dilemmas of local community facilitators doing participatory research
projects.Geoforum, 61, pp.27-35.
Sims, R.R. and Quatro, S.A. eds., 2016. Executive Ethics II: Ethical Dilemmas and Challenges
for the C Suite. IAP.
6