Cultural-Norm Ethical Dilemma Analysis

Organizational Cultural-Norm Case Scenarios

(Choose one of the following two case studies below)

1. Billing of Cranes (Collins, 2012)

Five months into the construction of your new building, you stop by the jobs site and count two

cranes, one of which is not being used. When you get back to the office, you review the general

contractor’s construction contract and notice that the original agreement was for one crane. You

review the most recent bills and realize that for the previous two months, you were billed for two

cranes. The cost per crane is $9,600 per month, which amounts to $19,200 for the second crane.

You mention the crane billing to a business associate familiar with the construction industry.

“Oh that’s typical,” she tells you. “A major revenue sources for general contractors in rental

income from their equipment. I heard that this particular general contractor owns more than $50

million worth of equipment. In order to make the payments and generate a return on investment,

the general contractor needs to bill that equipment to as many projects as possible for as long as

possible”.

At the next jobsite meeting, you ask the project manager why there are two cranes instead of the

agreed upon one crane. He says two cranes are required to improve productivity and keep on

schedule for your grand opening. You point out that only one crane is being used; the other crane

just seems to be parked there. “Oh we use both cranes,” he responds, “but sometimes not at the

same time.”

The next day you drive by the jobsite and see that, once again, only one crane is being used. You

mention this to your business associate again. “They’re scamming you” she insists. “The only

way these guys respect you is if you play hardball. On your next bill, only pay for one crane, not

two and if they make a big deal of it, tell them you want be reimbursed $19,200 for the previous

months when you were charge for two cranes even though the contract clearly state only one

crane would be used. I can find you a low-cost construction consultant who will put in writing

that only one crane is needed.”

You realize that if you refuse to pay for the additional crane the general contractor could issue a

work slowdown to prove that two cranes really were needed. The building is scheduled to open

in seven months, and the use of a crane is projected for another three months, which would cost $

28,800 for the extra crane. (p. 216)

2. Exception or Donation?

According to the Institute for Global Ethics (2012) Highland Electricity is well-known for

supporting community projects, and in recent years has increased its corporate giving. The

company has also recently defined its giving strategy, particularly in how it relates to their

business objectives. As part of this overall effort, Highland clarifies its giving guidelines. There

are four broad funding areas (Job training and economic development, Education, Emergency

preparedness, and Environmental stewardship), and grants are ideally awarded to organizations

within the company's service area.

Arts and cultural organizations, which are not included in the four funding areas, have received

few grants in recent years. Numerous arts organizations have been turned down with the

explanation that the company is focusing its resources in its strategic funding areas. Requests

from other organizations are turned down because they are outside the utility's defined service

territory.

Contributions manager Clarissa Watt has recently received two funding requests from high-level

managers within the company. The first is to provide a large (up to $25,000) grant to an arts

center in a small town in the service territory. A chief regulatory official's wife serves on the art

center's board. The second request is for a grant to a nonprofit organization outside the service

territory, but within the district of a very influential state legislator.

Both organizations are deserving of funding, and the activities to be funded are reasonable.

Though no linkage of any kind is asked for, offered, or implied by the regulator or the legislator,

the internal promoters of the grants feel these contributions will provide opportunities for

contact, relationship building, and good will that would serve the company well.

However, both grants are clearly outside the company's guidelines. And making an exception in

either case could prove awkward and raise expectations among other organizations that do not

meet the guidelines. On the other hand, granting funds for these two commendable projects could

help their respective communities and create positive fallout for the company. (Exception or

Donation, paragraph 1-5).

References

Collins, D. (2012). Business Ethics: How to design and manage ethical organizations. Hoboken,

NJ: John Wiley & Sons Inc.

Institute for Global Ethics (2012). Exception or Donation. Retrieved from

http://www.globalethics.org/dilemmas/Exception-or-Donation/21/