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Bad Arguments and Rationalization in Business
The following note attempts to catalog and analyze a set of flawed but common arguments made in business and organizational settings to drive strategic and operational decision making. The arguments are deconstructed into syllogistic form-a set of premises leading to a conclusion-and analyzed for validity and soundness. The final part of this note pays attention to ways decision makers can avoid such bad arguments and the rationalization that often goes hand in hand with them. -
Using a Framework to Create Better Choices
Intuition can be a good guide for decision making when the current situation generally matches the situations in which the intuition was formed. But for novel or ambiguous situations, relying only on intuition can blind us to possible negative consequences by focusing our attention only on data that support our intuition. To reduce the likelihood of these errors and to better imagine and prepare for the outcomes of our choices, we use a decision-making framework. This note outlines the process of how to apply a framework. -
To Stop Bad Behavior, Display a Virtuous Quote
New studies reveal that symbols and sayings that broadcast your morality may shield you from being asked to do something unethical. -
Religion in the Workplace: A Managerial Outline for Navigating the Law at the Intersection of Business and Religion
This technical note provides an overview of religious discrimination law in the United States and provides managers with a meaningful understanding of their rights and obligations when an employee's religious beliefs or practices conflict with his or her work responsibilities. The analysis will touch on intentional discrimination and harassment ("I'm firing you because you're Christian/Jewish/other"), types of religious discrimination that are readily identifiable and resolvable. Less obviously, U.S. law requires that employers provide "reasonable accommodation" whenever a religiously neutral business practice interferes with an employee's religious practice; this reasonable accommodation doctrine is more complex and nuanced. Providing reasonable accommodation presents obstacles for managers that are as legalistically dense as they are financially treacherous. This note aims to help managers identify blatantly illegal practices but it also aims to assist management in navigating the gray areas where the law is underdeveloped or inconsistently applied. The law often provides vignettes of what managers legally can or cannot do, but neither laws nor cases interpreting them provide clear answers for managers attempting to handle challenging religious issues that arise in their firms. Finally, while digesting the information provided in this note, managers must remember that this analysis describes legal solutions, not managerial ones. -
Ethics Beneath the Surface
Whereas there is much focus on improving the cognitive aspects of ethical decision making, many of the drivers of managerial action are nondeliberative. The explosion of academic work in behavioral science has highlighted a number of decision traps, blind spots, and behavioral biases that can substantially influence ethical decision making and action. This note focuses on a number of specific behavioral influences and how they relate to ethics. In addition to highlighting how these behavioral influences can impair decision making, we discuss ways they can be harnessed to potentially improve ethical decisions and actions. -
Moral Voice: Talking About Ethics at Work
This note identifies the importance of employee/moral voice in organizational functioning. Yet despite the many benefits of employee/moral voice for effective organizational functioning, the process of speaking up about ethical matters can be difficult for both employees and their managers. -
Flying Beavers: An Innovative Approach to Wildlife Conservation
Based on actual historical events, this case presents the narrative of when the Idaho Fish and Game Department decided to transplant beavers from a rapidly growing area of human habitation by catching them in live traps, flying the beavers to a more hospitable environment via airplane, and parachuting the caged beavers to the ground. Students are asked to evaluate the wisdom of this plan from ecological, economic, and ethical perspectives. This case is intended for an advanced undergraduate or graduate course in sustainable business practices, environmental management, business ethics, and/or wildlife conservation. -
An Intern's Dilemma (A)
An HBS student is asked to misrepresent himself during the course of his summer internship by his employer in order to obtain data from industry competitors. -
An Intern's Dilemma (B)
An HBS student is asked to misrepresent himself during the course of his student internship by his employer in order to obtain data from a competitor. This case describes how the student handled the situation and what he learned about himself from it. -
HalaMaterials (A): Negotiating Equity between Partners - Confidential instructions for John Ambtchious
A multi-issue one-on-one negotiation between a young entrepreneur (John Ambitchious) and a close-to-retirement CEO of a large corporation (George Gried). John and George are considering becoming partners on a venture John is setting up. Besides negotiating the partnerhship details, George currently works for a potential competitor, thus raising ethical tensions that should be negotiated before committing to a final deal. -
HalaMaterials (B): Negotiating Equity between Partners - Confidential instructions for Dr Gried
A multi-issue one-on-one negotiation between a young entrepreneur (John Ambitchious) and a close-to-retirement CEO of a large corporation (George Gried). John and George are considering becoming partners on a venture John is setting up. Besides negotiating the partnerhship details, George currently works for a potential competitor, thus raising ethical tensions that should be negotiated before committing to a final deal. -
Aarong: Social Enterprise for Bangladesh's Rural Poor
Aarong, the retail arm of BRAC, a non-profit development organization based in Bangladesh, was created in 1978 to provide employment, income generation and social development opportunities for underprivileged women through the revival and promotion of Bangladeshi handicrafts. Profits from Aarong were used to extend such opportunities to more low-income producers and to cross-subsidize BRAC programmes for the poor. In 30 years, from a single shop, Aarong had grown into one of Bangladesh's biggest retail chains. Its products ranged from clothing, household items, gifts and fashion accessories to children's toys. The competition, however, was intensifying, both from local retailers in individual categories as well as foreign players, such as from India. How could Aarong compete in a global market? How could it leverage the brand, improve quality to match machine-made consistency, and keep prices competitive, while maintaining its social mission? -
Stephen Richards: Addressing FAQ
Stephen Richards, former global head of sales at Computer Associates, addresses frequently asked questions from "A Letter from Prison." -
Himachal Fertilizer Corporation (A): An Ethical Conundrum
This case series provides a platform to discuss a broad range of interconnected issues relating to corporate governance, ethical reasoning and giving voice to values in a real-world decision-making context. An independent director (Neil Shah) on the board of directors of National Petroleum Corporation (NPC) is approached by a bidder, Western India Ports Limited (WIPL). Through an unwarranted last minute change in the bidding process, WIPL's bid for handling of Naphtha for NPC's upcoming refinery has been rejected. Neil learns from WIPL that its competitor, Bharat Ports Limited (BPL), may have bribed an NPC official to create a situation that would disqualify WIPL's bid. As a result, only one bidder (BPL) is left in the fray. Neil questions the process followed by NPC, without disclosing that an executive from WIPL had met him about the change in the process. Neil's questioning corrects the situation. WIPL is not only able to participate in the bid, but even wins the NPC contract. However, Neil's joy of righting the wrong is short-lived. A few months after the episode, and after stepping down from the board, Neil learns that the NPC official who had attempted to disqualify WIPL had been recruited by WIPL after his retirement from NPC. Soon after discovering this, Neil himself is approached by WIPL with a proposal to transfer 5000 shares from their holding to Neil, without any payment, as a mark of their gratitude to him. Should Neil accept the gift? Would that be akin to accepting bribe? Should Neil be disturbed by the knowledge that the concerned NPC executive had joined WIPL after retirement from NPC? -
Himachal Fertilizer Corporation (B): An Ethical Conundrum
Supplement to case NA0409. This case series provides a platform to discuss a broad range of interconnected issues relating to corporate governance, ethical reasoning and giving voice to values in a real-world decision-making context. An independent director (Neil Shah) on the board of directors of National Petroleum Corporation (NPC) is approached by a bidder, Western India Ports Limited (WIPL). Through an unwarranted last minute change in the bidding process, WIPL's bid for handling of Naphtha for NPC's upcoming refinery has been rejected. Neil learns from WIPL that its competitor, Bharat Ports Limited (BPL), may have bribed an NPC official to create a situation that would disqualify WIPL's bid. As a result, only one bidder (BPL) is left in the fray. Neil questions the process followed by NPC, without disclosing that an executive from WIPL had met him about the change in the process. Neil's questioning corrects the situation. WIPL is not only able to participate in the bid, but even wins the NPC contract. However, Neil's joy of righting the wrong is short-lived. A few months after the episode, and after stepping down from the board, Neil learns that the NPC official who had attempted to disqualify WIPL had been recruited by WIPL after his retirement from NPC. Soon after discovering this, Neil himself is approached by WIPL with a proposal to transfer 5000 shares from their holding to Neil, without any payment, as a mark of their gratitude to him. Should Neil accept the gift? Would that be akin to accepting bribe? Should Neil be disturbed by the knowledge that the concerned NPC executive had joined WIPL after retirement from NPC? -
Himachal Fertilizer Corporation (C): An Ethical Conundrum
Supplement to case NA0409. This case series provides a platform to discuss a broad range of interconnected issues relating to corporate governance, ethical reasoning and giving voice to values in a real-world decision-making context. An independent director (Neil Shah) on the board of directors of National Petroleum Corporation (NPC) is approached by a bidder, Western India Ports Limited (WIPL). Through an unwarranted last minute change in the bidding process, WIPL's bid for handling of Naphtha for NPC's upcoming refinery has been rejected. Neil learns from WIPL that its competitor, Bharat Ports Limited (BPL), may have bribed an NPC official to create a situation that would disqualify WIPL's bid. As a result, only one bidder (BPL) is left in the fray. Neil questions the process followed by NPC, without disclosing that an executive from WIPL had met him about the change in the process. Neil's questioning corrects the situation. WIPL is not only able to participate in the bid, but even wins the NPC contract. However, Neil's joy of righting the wrong is short-lived. A few months after the episode, and after stepping down from the board, Neil learns that the NPC official who had attempted to disqualify WIPL had been recruited by WIPL after his retirement from NPC. Soon after discovering this, Neil himself is approached by WIPL with a proposal to transfer 5000 shares from their holding to Neil, without any payment, as a mark of their gratitude to him. Should Neil accept the gift? Would that be akin to accepting bribe? Should Neil be disturbed by the knowledge that the concerned NPC executive had joined WIPL after retirement from NPC? -
Unilever in Vietnam: The "Perfect Village" Initiative
Unilever Sustainable Living Plan (USLP) is a global initiative integrating Unilever's commercial and sustainability-related agenda. In this context, Unilever is reviewing the progress so far of its new "Perfect Village" initiative in Vietnam, which seeks to build a financially viable rural business that also makes a positive social impact. Please visit the dedicated case website http://cases.insead.edu/unilever-in-vietnam/ to access supplementary material. -
Someone to watch over me: The integration of privacy and corporate social responsibility
Firms' relationships with key stakeholders are increasingly threatened by privacy concerns. Given the role of firm corporate social responsibility (CSR) initiatives in strengthening and enhancing these relationships, this article examines the intersection between privacy issues and CSR activities, and creates a framework for assessing privacy-related activities as an element of broader CSR strategy. Specifically, the present research considers a firm versus customer focus in privacy-related activities, as well as privacy-related activities in the form of business practices versus goods and services. We identify four areas of overlap between CSR and privacy. We highlight the potential opportunities to better manage privacy-related issues of stakeholders, and integrate these concerns into the broader CSR agenda. -
The Rising Tide of Artificial Intelligence and Business Automation: Developing an Ethical Framework
Recent advancements in robotics, artificial intelligence, machine learning, and sensors now enable machines to automate activities that once seemed safe from disruption-including tasks that rely on higher-level thinking, learning, tacit judgment, emotion sensing, and even disease detection. Despite these advancements, the ethical issues of business automation and artificial intelligence-and who will be affected and how-are less understood. In this article, we clarify and assess the cultural and ethical implications of business automation for stakeholders ranging from laborers to nations. We define business automation and introduce a novel framework that integrates stakeholder theory and social contracts theory. By integrating these theoretical models, our framework identifies the ethical implications of business automation, highlights best practices, offers recommendations, and uncovers areas for future research. Our discussion invites firms, policy makers, and researchers to consider the ethical implications of business automation and artificial intelligence when approaching these burgeoning and potentially disruptive business practices. -
Full of Surprises: Dietary Supplements and the Gym, or, a Tale of Corporate Social Responsibility
Working out at the gym is a healthy endeavor, but many gyms endorse unhealthful practices. They may advertise or sell dietary supplements for weight loss or muscle building that not only fail to do what they promise, but contain potentially dangerous ingredients. Callie Guertin is a primary care physician in Hamilton, in the fictitious U.S. state of Columbia, and a daily gym-goer who is slowly awakening to the fact that her chosen new gym, MuscleTone, sells weight-loss supplements at its welcome desk. She wants them to stop; but what can she do on her own? With some guidance from a young activist, Stacie Lubin, and her sympathetic personal trainer, Rudi, Guertin learns skills of coalition building to pressure the MuscleTone chain to change its practices. Perhaps, using principles of corporate social responsibility, or CSR, MuscleTone can be made to realize that abandoning sales and advertising of supplements can produce a good result for everybody-healthier customers, of course, but also a new marketing campaign touting MuscleTone as the gym for "healthy living"? Guertin and her allies are working on MuscleTone to make just this case.