Mei-li stared at the code of ethics she received when she first began to consult with Business Equipment Corporation

(BEC). Right there, under the heading “Competition,” it stated, “BEC strongly believes in the competitive process.

While we are dedicated to selling the best products, we have a strong commitment toward competing fairly and honestly.” Mei-li wondered if there was any way to do her assignment without going against this core value.

Mei-li’s first consulting assignment after graduating from UCLA was to work with Kyle, an engineer at BEC. Their assignment was to help develop and produce a new copy machine. Last year BEC discovered a new technology that would enable them to manufacture a copy machine with a copy quality far superior to anything else on the market.

Mei-li and Kyle are both sure they have a winning product.

“I am especially excited about this. My kids are going to be so proud,” said Kyle. “I’ve been promised a promotion and a doubling of my salary if the new product launch is successful.”

Several months went by, and one morning Kyle came in, panic stricken. “Have you read the news?” Kyle asked Mei-li. “The industry reporter says that our competitor Hiyota plans to launch a new high-quality copier machine within the next month! If the Hiyota machine is as good as this article says, I’m dead,” said Kyle.

“What do we do?” asked Mei-li. Kyle thought for a while and then replied, “Mei-li, we have to do this quickly before they roll out their machine. We need to make sure ours is better. I want you to pretend to be a potential customer and call Hiyota. Tell him you’ll meet at the Hilton in one of the conference rooms. When the salesperson starts up, make sure you ask about copy quality, get samples, and learn as much as possible about novel product features, pricing, advertising strategy, etc. If we can get this information this week, we can help the plant people modify our machine so that it kills Hiyota.”

Mei-li replied, “Kyle, I’m not comfortable with pretending to be a buyer. What if Hiyota finds out? What about me wasting the time of this salesperson? I don’t want the firm to get a reputation for this sort of thing.”

Kyle replied, “This isn’t a big deal. It’s not illegal because we’re not stealing trade secrets. If the salesperson is telling clients about the product, then it can’t be illegal. Getting competitive product information takes place all the time, and it’s Hiyota’s responsibility to develop security procedures to prevent information from slipping out before the product hits the market. As far as the sales representative’s time, you know that many of them have nonproductive sales calls. We can’t afford to wait, Mei-li!”

As Mei-li left the office, she decided to ask Bob, their boss, about Kyle’s proposal. As she discussed the information with Bob, he replied, “Unofficially, I’d say unless you can come up with some valid reasons to reject Kyle’s plan, you should call Hiyota. Officially, I would say that BEC does not condone such practices and considers them unethical according to our code of ethics. Finally, unofficially, you need to know, Mei-li, that if Kyle doesn’t pull this one out of the fire, he won’t be here for very long.”

“Have you ever done something like this, Bob?” asked Mei-li.

“I know this type of thing happens frequently, and know some of the justifications for it. For example, it’s common to state that the person had no choice or try to deny responsibility. Or they have a family to support, or everyone else does it. Those are the justifications I hear the most. However you want to justify it, it happens. Sometimes people get caught and sometimes they don’t.”

“You didn’t answer my question, Bob. Have you ever done something like this?”

“Mei-li, I just answered your question.” With those words, Bob excused himself and left.

That was Tuesday. Now Mei-li was sitting at her desk two days later staring at the code of conduct. She did not know what to do. It seemed like Kyle’s job was on the line.

She heard footsteps and looked up as Kyle approached her.

“Have you set up the appointment?” Kyle asked.

Questions:-

1. Discuss whether Kyle’s proposal would violate BEC’s code of ethics.
2. Identify the organizational pressures that Mei-li is facing to call Hiyota.
3. How should Mei-li handle the situation?