You are a Supply Chain Manager for Primo Caf, reporting to Marco, who is the Chief Operating Officer. Maureen is the Engineering Supervisor for Primo Caf. She recently completed testing the Caffissimo at the UL Laboratories to obtain UL certification for the product line. UL certification is an annual requirement for sales of all electrical devices in the U.S. The tests passed UL requirements, but she found that the amount of water dispensed into a cup was not consistent. For a standard 12-ounce cup setting, the specification is 12 ounces plus/minus 0.10 ounces. However, sometimes, it dispensed up to 12.35 ounces. In the Caffissimos design, a pressure gauge is responsible to maintain volume of water consistency. TSK is the strategic supplier for this pressure gauge, and TSK has a very good supplier scorecard.

Maureen was quite concerned about this issue. There have been no customer complaints to Primo Caf. However, there have been lawsuits in the industry based on customer burns due to overfilled cups and, sometimes, customers mishandling scalding water in full cups. Also, last year, after Caffissimo won an annual industry award for Best Coffee Maker in North America, an article referenced how Primo Cafs Caffissimo always dispenses a precise amount of water which provides a consistently high level of quality in its coffee.

When Maureen returned to Primo Caf, she immediately tested 100 gauges. Of the 100 tested, 23 failed testing with more than 12.10 ounces of water dispensed. Maureen was livid! She notified her management team of the issue. Ryan, Primos Vice President of Engineering, called TSKs President, Thomas Kelley, and told him that TSK has lost Primo Cafs confidence and soon, will no longer be a supplier to Primo Caf!

Ryan then called Marco, while you happened to be in his office, and told him of the situation. He demanded that Primo Caf find a new supplier for this gauge and cease all business with a company as unreliable as TSK.

The next morning, Thomas Kelley was with you at Primo Caf to better understand the situation. He took the 100 gauges tested back to TSK so that they could further analyze the gauges.

At 8:00 AM the next morning, Thomas called you. His team ran many tests on the gauges during the past 18 hours and found that all of the gauges met Primo Cafs specifications (300 350 PSI). However, the error (dispensing too much water) will only happen when the gauge is between 325 350 PSI. You asked if there were any errors when gauges are between 300-324 PSI Thomas stated that all gauges between 300-324 PSI dispensed the correct amount of water. You responded, Great! Can you just manufacture future gauges between 300-324 PSI? Thomas response was Yes, but our manufacturing process will need to change for a specification that tight. There may be a small price increase due to these changes.

You talk with Marco about your conversation with Thomas. Marco points out, correctly, that Primo Cafs specification is really at fault which was designed by Primo Caf Engineering. Primo Caf management and engineering want to know the plan moving forward and, in their minds, moving forward quickly without TSK. Marco asks you for a recommendation on how to proceed.

Applying the ethical framework presented in class, complete the following. Be sure to thoroughly answer each question/bullet point below.

Step 1: Recognize an Ethical Issue

• Could this decision or situation be damaging to someone or to some group? Explain.
• Is this an ethical or legal issue, or both?

Step 2: Get the Facts

• What are the relevant facts of the case?
• What facts are not known?
• What individuals/groups have an important stake in the outcome?
• Do you know enough to make a decision at this point? Why or why not?

Step 3: Develop Potential Alternatives

• Develop three creative options for acting.
• Have all the relevant individuals/groups been considered in your options? Explain.

Step 4: Take Action & Measure Impact

• Develop a detailed plan for implementing one of your alternatives. What would you do first, second, third, etc.
• What is the right metric(s) for measuring the success of this action?
• Does your metric align with your ethical goals? Explain.

Step 5: Reflect on Outcomes

• How might you adjust/improve your course of action if things do not go according to plan?