Software-procurement decision, ethics. Jorge Michaels is the Chicago-based controller of Fiesta Foods, a rapidly growing manufacturer and marketer of Mexican food products. Michaels is currently considering the purchase of a new cost-management package for use by each of the company’s six manufacturing plants and its many marketing personnel. Four major, competing products are being considered by Michaels.

Horizon 1-2-3 is an aggressive software developer. It views Fiesta as a target of opportunity. Every six months, Horizon has a three-day users’ conference in a Caribbean location. Each conference has substantial time allowed for “rest and recreation.” Horizon offers Michaels an all-expenses-paid visit to the upcoming conference in Cancun, Mexico. Michaels accepts the offer, believing it will be very useful to talk to other users of Horizon software. He is especially looking forward to the visit because he has close relatives in the Cancun area.

Prior to leaving, Michaels receives a visit from the president of Fiesta. She shows him an anonymous letter sent to her. It argues that Horizon is receiving unfair favorable treatment in Fiesta’s software decision- making process. The letter specifically mentions Michaels’ upcoming “all-expenses-paid package to Cancun during Chicago’s cold winter.” Michaels is deeply offended. He says he has made no decision, and he believes he is very capable of making a software choice on the merits of each product. Fiesta currently does not have a formal, written code of ethics.

1. Do you think Michaels faces an ethical problem in regard to his forthcoming visit to the Horizon users’ group meeting? Refer to Exhibit 1-7. Explain.

2. Should Fiesta allow executives to attend user meetings while negotiating with other vendors about a purchase decision? Explain. If yes, what conditions on attending should apply?

3. Would you recommend that Fiesta develop its own code of ethics to handle situations such as this? What are the pros and cons of having such a written code?