Ethical Dilemmas in Business

Paper Summary:

This paper discusses the potential ethical dilemma of a company that is distributing a product that it has subsequently discovered to be flawed. The paper specifically discusses FET, which has been distributing its micro system product. The paper concludes that to continue distribution would be detrimental to the company, its shareholders, and the customer upon whom the company relies.

From the Paper:

"Ethical Dilemma 1. Is there an ethical problem? If so, what is it? On the surface there is not yet an ethical dilemma. While the executive compensation is tied to the success of FET's micro system in the open marketplace, the simple fact of the matter is that the system is flawed. If an organization is ethically sound as well as operationally sound it would never consider distributing a product with known and pre-existing flaws. Such an act, while perhaps bolstering its short-term finances and padding the salary of the executives whose salaries are dependent upon the product's success, would have a long-term devastating effect on the reputation and brand of the company. Additionally, once the flaw became widely recognized the company would be faced with warranty obligations which would quickly mitigate any financial gains to the company."

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