Business Ethics

Business Ethics

From a business perspective, working under government contracts can be a very good proposition. In general, a stream of orders keep coming in, revenue increases and the company grows quickly. The obvious downfalls when working in this manner are higher quality expected as well as the extensive research and documentation required for government contracts. If a part fails to perform correctly it can cause minor glitches as well as problems that can carry serious repercussions, such as in the National Semiconductor case. When both the culpable component and company are found, the question arises of how extensive these repercussions should be. From an ethical perspective one would have to look at the mitigating factors of both the employees and their superiors along with the role of others in the failure of these components. Next analyze the final ruling from a corporate perspective and examine the macro issue of corporate responsibility in order to attempt to find a resolution for cases like these.

The first mitigating factor involved in the National Semiconductor case is the uncertainty, on the part of the employees, on the duties that they were assigned. It is plausible that during the testing procedure, an employee could not distinguish which parts they were to test under government standards and commercial standards. In some cases they might have even been misinformed on the final consumers of the products that they tested. In fact, ignorance on the part of the employees would fully excuse them from any moral responsibility for any damage that may result from their work. Whether it is decided that an employees is fully excused, or is given some moral responsibility, would have to be looked at on an individual basis. The second mitigating factor is the duress or threats that an employee might suffer if they do not follow through with their assignment. After the bogus testing was completed in the National Semiconductor labs, the documentation department also had to falsify documents stating that the parts had surpassed the governmental testing standards. From a legal and ethical standpoint, both the testers and the writers of the reports were merely acting as agents on direct orders from a superior. This was also the case when the plant in Singapore refused to give up the documents and were later recovered by employees at the California plant before being submitted to the approval committees (Velazquez, 53). The writers of the reports were well aware of the situation yet they acted in this manner on the instruction of a supervisor. Acting in an ethical manner becomes a secondary priority in this type of environment. As stated by Alan Reder, if they [the employees] feel they will suffer retribution, if they report a problem, they are not too likely to open their mouths (113). The workers knew that if the reports were not falsified they would come under questioning and perhaps their employment would go into jeopardy. Although working under these conditions does not fully excuse an employee from moral fault, it does start the process for determining the order of the chain of command of superiors and it helps to narrow down the person or department that issued the original request for the unethical acts. The third mitigating factor is one that perhaps encompasses the majority of the employees in the National Semiconductor case. There was a balance of the direct involvement that each employee had with the defective parts. Thus, it had to be made clear that many of the employees did not have a direct duty with the testing departments or with the parts that eventually failed. Even employees, or sub-contractors, that were directly involved with the production were not aware of the incompetence on the part of the testing department. For example, the electrical engineer that designed the defective computer chip could have acted in good faith and test the chip to ensure that it did indeed meet the required government endurance tests, instead of assuming. Also, for the employees that handled the part after the testing process, they were dealing with what they believed to be a component that met every governmental standard. If it was not tested properly, and did eventually fail, is the testing department more morally responsible than the designer or the assembly line worker that was in charge of installing the chip? Plus, in large corporations there may be several testing departments and in some cases one may be held more responsible than another depending on their involvement. A process like this can serve the dual purpose of finding irresponsible employees as well as those that are morally excused. The fourth mitigating factor in cases of this nature is the gauging of the seriousness of the fault or error caused by this product. Since National Semiconductor was repeatedly being reinstated to the listed of approved government contractors, one can safely assume that the level of seriousness, the opinion of the contractor approval committees, is not of monumental importance. But how could the case have been different, if the lack of testing caused the loss of life in either a domestic or foreign military setting? Perhaps the repercussions would have came faster much more harsh. The fact that National Semiconductor did not cause a death does not make them a safe company. They still needed to be held responsible for any errors that their products cause, no matter the magnitude. As for the opposition to the delegating of moral responsibility, mitigating factors and excusing factors, they would