Read the case study Protect Your Company or Your Cousin? Drawing on material from our reading in the book Justice and in Business Ethics, indicate which expert opinion (Stacey Peck or Mita Mallik) is closest to your own, and why. By Friday evening, 4-8-22, 11:59 p.m. Initial post: Summarize your reflection paper (about 150 words.) By Sunday evening, 4-10-22,11:59 p.m. Respond to two classmates' initial posts. Your responses should be about 75 words each. Marguerite Customer experience manager at Spring Fire On her family's weekly Zoom call, Marguerite notices that her cousin Linda seems upset. if Our biggest customer just canceled its contract with us. If your company doesn't renew, I don't think we'll make it. Linda Marguerite's cousin and a Colter employee Angela Marguerite's mother 83537 - - Marguerite's colleagues 18.00 You OK? You look sad. It's just work stuff. I'm sorry. LMK if I can help. Despite their agreement to not talk about work, Linda confides that her company, a supplier to Marguerite's, has laid off 30% of its employees. CASE STUDY Protect Your Company or Your Cousin? by Joseph L. Badaracco HBR's fictionalized case studies present problems faced by leaders in real companies and offer solutions from experts. This one is based on the HBS case study "The Analyst's Dilemma" (case no 394066-PDF-ENGI by Joseph L. Badaracco and Jerry Useem, which is available at HBR.org AFTER A LONG WEEK, all Marguerite Espinoza wanted to do was shut down her computer. It was 5:30 on Friday afternoon, and she'd just finished her workday as a customer experience manager at Spring Fire, a manufacturer of outdoor smokeless firepits. But she was supposed to log in to her extended family's weekly Zoom call, a tradition they'd started at the beginning of the pandemic. It'll be fun-it always is, she told herself as she searched for the link in her calendar. Most weeks she looked forward to the virtual gathering. It was chaotic, with up to eight households logging on, but it was a nice way to catch up with everyone and transition away from work into the weekend. As soon as the faces of her par- ents, grandparents, sister, aunts, uncles, and cousins popped up, she was glad she'd joined. But about 20 minutes into the call, she noticed that one cousin, Linda Garbes, seemed distracted, maybe even upset. She and Linda considered each other friends more than family. They had hung out at family gath- erings since they were little and had kept in touch through college. Now they were both 26, and even though Marguerite was still in Houston and Linda had moved to Tulsa, they texted regularly. With fewer employees, will you be able to hit our delivery dates? I'm more worried about my job. Marguerite pinged Linda now: You OK? You look sad. Linda replied right away: It's just work stuff. Marguerite knew Linda's employer well; in fact, she'd helped her cousin get the job at Colter Metals, a custom manufac- turer of parts for fans, blowers, and compressors. Colter supplied Marguerite's company with two key parts used in the fans on Spring Fire's firepits. A year earlier, when Marguerite realized that Colter was based in Tulsa and saw on its Linkedin page that the company was hiring, she had encouraged Linda, an accounting major, to apply for work in the finance department. Colter was a long-standing and critical sup- plier, and Spring Fire was about to renew its contract. Marguerite and Linda had agreed early on not to talk to each other about work. They wanted to keep family--and their friendship-separate from their employers' business. And they'd managed to stay true to that commitment. So when Linda mentioned work, Marguerite didn't probe. Instead she wrote, I'm sorry. LMK if I can help. An hour later, after she'd logged off Zoom, her phone buzzed with a text from Linda: Actually, can u talk? Marguerite called her right away. "OK," Linda said as soon as she'd answered. "If I tell you something, will you promise not to tell anyone?" Marguerite agreed. Linda explained that Colter had laid off 30% of its staff earlier that day- mostly on the production side- leaving her completely shocked. "You had no idea that was coming?" Marguerite asked. "No," Linda said, sounding teary. "I thought the company was doing fine, but apparently our biggest customer just canceled its contract with us." "I thought Spring Fire was your biggest customer." "Y'all are second." Marguerite felt queasy. Her mind went immediately to what this could mean for her employer. Spring Fire was already six weeks behind on orders, and winter was just beginning. As a customer experience manager, she had to script language explaining the back orders. Earlier that day she'd drafted copy promising that any order placed before the end of November would be delivered by February 1. Would the situation with Colter jeopardize that promise? "I'm serious about not telling anyone, Rita," Linda said, using Marguerite's family nickname. "If Spring Fire gets cold feet and doesn't sign that renewal, I don't think Colter will make it." Experience "But will you all be able to meet the delivery dates in the con- tract with 30% fewer people?" "I don't know," Linda said. "But I'm more worried about my job right now." Marguerite felt guilty that she'd been so focused on Spring Fire. Of course she was worried about her cousin, too. But Linda had to know that Marguerite would consider the implications for her company and her own job. DELAYS The following Monday, Mar- guerite was relieved to be in the office. Spring Fire employees were allowed to go in on a rotating schedule, and she'd signed up for Mondays. Just a few employees were on-site each day, but she liked to see them, even if just their eyes above their masks. She unpacked her laptop and waved hello to two colleagues from the finance department, who were chatting in cubicles a couple of rows away from her. Because they were maintaining distance from each other, Marguerite could overhear their conversation, which happened to be about the Colter contract renewal. Case Study Classroom Notes 1. "Smokeless firepits still produce smoke but they reduce it through design and engineering that manages airflow Some like Spring Fire's use fans 2. Is this a fair question to ask someone who doesn't know what you're about to say? 3. Do back orders signal to consumers that a product lain high demand and therefore more desirable, or do they frustrate shoppers who might take their business elsewhere? Marguerite overhears two colleagues from the finance department discussing Spring Fire's sales and its relationship with Colter. Colter wants to extend the contract. and the CEO wants to preserve that relationship. We don't have many alternatives. Marguerite asks her mother for advice. Do you feel like you owe the company your loyalty? We're well positioned anyway. Did you see last week's numbers? If Colter can't deliver, there certainly will be further delays. If things go south with Colter and Spring Fire, it's not like my manager will wonder if I knew. Now, if we can just ship those orders before 20221 4. In the wake of Could-19, experts have urged companies to make their supply chains more resilient by identifying vulnerabilities and diversifying their supplier bases 5. Is it smart for the CEO to focus her team on the order increases while downplaying the potential fulfillment risks? "They came back with another ask this morning," one said. "They want to extend the contract by a year." "Do you think Martha will go for it?" the other asked, referring to Martha Springer, the firm's founder and CEO. "I know she wants to preserve that relationship. The list of alter- native suppliers is short." Marguerite thought about the risk dashboard that Martha always shared at their weekly all- hands meeting. Although most of the boxes were green or yellow, the supply-chain box had been red for the past few weeks. Many of the company's key inputs were sourced externally, and everyone knew that presented its greatest risk. Previous attempts to source the same parts that Colter made from China and Bangladesh had failed: Those products barely met industry standards and definitely didn't meet Spring Fire's quality criteria. After a lot of searching and false starts, the head of product had found a viable sup- plier in Mexico. But many at the company were hesitant to use that option, because Spring Fire had made a point of market- ing its products as fully made in the U.S.A. During the all-hands meet- ings, the head of procurement typically explained everything that was being done to mitigate any potential halt in production. Martha would reframe the issue and reassure her employees. "An abundance of orders is a good problem to have," she'd say, point- ing out the steep and encouraging climb in sales.5 Luckily, Marguerite's col- leagues now changed the subject quickly. One of them shrugged and said, "I'm not sure that it matters anyway. We're so well positioned. Did you see last week's numbers?" "Amazing, right? Now, if we can just ship those orders before 2022!" They both laughed and then smiled at Marguerite, who managed a small chuckle. If Colter was struggling, could Spring Fire meet the demand? Delivery times would certainly push back-again-despite all their hard work, and the compa- ny's reputation would suffer. It wasn't the only manufacturer in this space, and although it did offer a unique patented fan to fur- ther reduce smoke, it was unclear whether consumers appreciated that differentiator. Just then Patrick Cullen, the chief marketing officer and Marguerite's boss, walked into his cubicle a few rows over and spoke loudly from behind his mask: "Good weekend, Marguerite?" She gave him a thumbs-up. "Anything I should know before I dive in?" She hesitated and then shook her head. He knows your cousin works there, right? Go ahead and say it. Family comes first. Marguerite contemplates sending an email to her manager and the CEO. To: Springer, Martha Cullen, Patrick Subject: important information a Colter Metals But family doesn't come before yourself. I don't think it was fair of Linda to tell you. If keeping this secret means you risk your reputation, you know where I stand. Because of a family connection I learned that Colter had to lay portion of its staff and may not follow through on its commitm But she changes her mind and deletes it. FAMILY FIRST? That night Marguerite texted her mom, Angela: Free to talk? Her mom FaceTimed her right away and said, "What's wrong? You never want to talk on the phone." It was true. Marguerite's mom always kept her on the phone much longer than she would like. But she really needed advice. She recounted the Friday night call with Linda and explained that she'd spent most of the weekend agonizing about what to do. She described how guilty she'd felt at the office earlier. "Do you feel like you owe Patrick and the company your loyalty?" her mother asked. Pat- rick had taken a chance by hiring her three years earlier when she had close to zero experience in customer service or marketing. Since then he'd been her tireless advocate. "I guess so. Though if things go south with Colter and Spring Fire, it's not like he or anyone else will wonder if I knew." "You don't think he will?" Angela asked. "He knows your cousin works there, right?" Indeed, Marguerite had been excited when Linda got the job and had shared the news with Patrick. She remembered now that he'd actually made a throwaway joke about how nice it was to have a spy at one of their suppliers. She'd laughed but then assured Patrick that she and her cousin had agreed not to talk shop. "I know, Mom. And I know what you're going to say. You don't even have to say it." "What am I going to say, smarty-pants?" "Family comes first." When her mother shook her head, Marguerite was surprised. "C'mon, that's always been our motto," she said. "But I didn't mean that family comes before yourself," Angela said. "It could be you out of a job if you all can't deliver on those orders. Or if Spring Fire finds out you knew about this problem and didn't say anything. I don't think it was fair of Linda to tell you. You'd agreed to not talk about work." Marguerite was shocked. She'd been sure that her mother would tell her to keep her promise. If Colter didn't meet its obligations, Spring Fire could rightly cancel the contract and go with the supplier in Mexico. It would be a huge headache, of course, but the company would be OK. And assuming that Patrick and Martha weren't furious with her, Margue- rite would still be employed. "So all bets are off?" she asked Angela. "I can betray Linda?" "No, not necessarily. I'm just saying it's more complicated than deciding between Linda and your company. If keeping this secret 6. To what extent should we feel a duty to our employers? And can we expect that loyalty to be returned? 7. Does knowing that she won't be found out lesson her obligation to say something? 8. Does the fact that Linda violated their pact to not talk about work mean that Marguerite doesn't need to keep her promise of silence? Experience ortant that she 6 of 7 have all the facts mhip may well an. But Spring Fire should look into this before it renews the contract. Even if Patrick suspects that Marguerite got the information from MITA MALLICK hear of inclusion equity Linda, she doesn't have to implicate her Marguerite shouldn't say cousin outright. This case reminded me of a group of friends I made at work many years ago. There were eight of us, and although we've since transferred to other locations or changed companies, we've stayed very close. One of those friends is now on the legal team at my organization, which means she's privy to news and developments that she can't pass along. We have an unspoken agreement that we won't compromise either our careers or our friendship by sharing confidential information, and we've never broken it. Linda violated the arrangement she made with Mar- guerite and can't now expect her to hide information material to her company and her job. It may well be that Linda is making Colter's layoffs a bigger deal than they actually are. But to know whether that's true, Marguerite needs to take action. That includes telling Linds that she felt she had to share the news even as she took pains to avoid implicating her. It will be a tough conversation, but the needs to be up-front. She can explain that she never mentioned her cousin and acknowledge that many supply chains have been disrupted during the pandemic, so it's perfectly normal for customers to ask suppliers-even unprompted-whether anything might prevent them from delivering on their promises. I'm a relationship person, and I would never do anything knowingly to harm a bond with a friend or a family member. But in this case, I think Marguerite can do right both by Linda and by Spring Fire. Their interests are less at odds than she thinks. anything to Patrick, Martha, out, especially if you can't be sure the information is accurate. During the pandemic, situations are ad Leaders are planning and replanning, pivoting firing, and sometimes rehiring. It may be that Colter's leadership teams feels that it's advantageous to do layoffs now but plans to bring many people back later on. Linda isn't a senior leader and may not be privy to the full picture. It's also possible that fear of losing her job keeps or anyone else at Spring Fire. ber from seeing the situation dealy I understand the temptation to share the information Linda gave her, but doing so won't reflect well on her and may cause more trouble than it's worth. I've twice been in a similar situation. Early in my career I became friendly with a woman who worked in HR at the same company. She and I went out for drinks, and after getting a little tipsy, she told me that the company was restructuring and a good friend of mine was going to be laid off. Like Linda, my colleague asked me not to say anything. Estruggled with what to do but eventually decided to keep the information to myself, and Tm glad I did. The restructuring got pushed out by three months, and my friend ended up leaving the company before then. Had I told her what I knew-information that turned out to be inaccurate-it would have caused her a lot of unnecessary stress Later in my career, when I was at a consumer packaged goods company, someone in my network told me that one of the marketing agencies we worked closely with had been invited to pitch for our biggest competitor. (Conflict of interest norms prevented the agency from doing business with both of us.) I trusted the information but again, he itated to act on it. Eventually our agency reps told us that they'd had a chance to go through the RFP process with our com petitor and had talked to the company but declined to proceed. As before, had 1 shared the information internally, it would have caused a stir for no reason My experience has taught me that It's better to wait and let things play If Marguerite shares the informa tion and Spring Fire uses it to make a decision, such as going with the Mexican supplier, but Linda's facts were wrong or incomplete and the problems at Colle blow over, there could be serious down- stream consequences. Also, if I were Patrick and my employee shared intel from her cousin that she had promised to keep secret, it would give me pause. I'd wonder whether I could trust her to keep infor- mation about Spring Fise confidential What if the roles were reversed, and Spring Fire planned to discontinue the product that uses Colter Metal parts? Would Marguerite tell Linda? Patrick might get the impression that she's loyal only when it's convenient or beneficial to her. One thing Marguerite could do is encourage Linda to talk to Colter's man agement about bring forthright with Spring Fire. That's part of being a good partner and supplier: letting your cus tomers know when there's a problem, whether it's a part out of stock, a fein your warehouse, or financial stress due to a lost contract. I'd bet Martha would respond positively to that candor So Marguerite should sit tight for now. I'd remind her that jobs and employers come and go, so your time and energy are better spent focusing on the relationships you want to keep. Reprint Case only Reprint Commentary only Copyright 2021 Harvard Business Publishing. All Rights Reserved. Additional restrictions may apply including the use of this content as assigned course material. Please consult your institution's librarian about any restrictions that might apply under the license with your institution. 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