Weeks 4-5 – Ethics Vignette – Individual Team Member Vote

Week 4:  In capsim.com: Complete the Ethics Vignette during Competition Round 3 (CR3). Follow the instruction provided on your Dashboard to complete this assigment. 

Each Team Member will submit one vote regarding the ethical dilemma. Teams can earn up to 25 points for this assignment based on votes (depends on number of team members per team).  

NOTE: If you do not vote, you do not earn points for your team. 

Week 5: In Canvas: Prepare a report using the following information. Only one team member from each Team needs to submit the file (Word document). 

Ethical Vignette – Material Costs – 

The company wants to lower material costs roughly 5% – 10% by switching to a new material in its production process. However, sensors made with this material overheat and malfunction, passing the Three Sigma performance test, but failing the company’s renowned Four Sigma testing standard. Key customers in the health care industry depend on sensors with a high level of performance. They demand products that meet the Four Sigma seal of 99.38% reliability whereas the Three Sigma standard only signifies an error-free rate of 93.3%. So, while sensors made from the less expensive material can be sold at a more competitive price point, the risk of defects is much higher, 6.7% vs. 0.62%. Additionally, the legal department recommends changing the company’s standard warranty for all its products to reduce overall liability and lesson the number of overall warranty claims.

Teams are presented with four options:

1. Do nothing
2. Seek Board approval for the warranty change, put the new alloy into full production across all product lines and ask marketing to update the warranty materials without publicly announcing the revisions.
3. Seek Board approval for the warranty change, put the new alloy into full production across all product lines and ask marketing to update the warranty materials as well as have the sales reps quietly communicate the warranty changes to existing customers.
4. Continue to produce Four-Sigma-Rated products with the traditional alloy. You do not seek Board approval for the warranty change, electing to keep the current warranty language. Ask production to continue to seek ways to improve the reliability of the newer alloy with the goal of achieving lower material costs.

Prepare a Brief Report that addresses the following questions regarding the Vignette:

1. Summarize the key issues in this case study.
2. After reading this issue, you are asked to make a decision. Who will benefit from your actions, and who won’t?
3. As managers of your company, what is your stake here?
4. Assume there is a right decision and a wrong decision, what would you consider to be a wrong decision? Why?
5. Are these decisions fair? Are they legal?
6. Which decision did the Team choose? Why?
7. Provide any final thoughts on this case study.

Elements of the brief should comply with APA Style 7th ed. student version formatting guidelines:

1. Add a title page
2. Body of report should be around 800 words (2-3 pages) – include citations to identify the source(s) you used
3. Separate reference page – use at least one peer-reviewed article (can be from the course) to support your discussion

NOTE: The ethics decision vote will be made during CR3 of Week 4 by each team member. The team-based report will be due at the end of Week 5 of the course.