IIM Nagpur

Personal and
Professional Ethics
An Ethical Dilemma

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An Ethical Dilemma

I was brought up in a small town down south of India. I did my engineering from the same place. I
was brought up in a relatively very orthodox family. I believe that I have liberal values compared to
the people that I grew up with. I had stayed in Pune and Bangalore for almost one year each while I
was working.

I experienced an ethical dilemma at the workplace during my stint as an Area Manager for an
automobile manufacturing company. The organization followed a cross auditing system in which
managers would go to locations outside their territory and perform an audit for dealerships there,
once every two quarters. It involves the verification of service reports, ratifying the processes and
allotting scores to these units on the basis of their performance. Based on these scores, eligible
dealers can be promoted to ‘Diamond’ category which is the highest for a dealer.

As a requirement of this system, I was required to visit dealerships in a semi-urban location in

Maharashtra, a year into my appointment. Accompanied by the territory manager for this region –
who was also a good friend of mine – I visited my fifth dealership at the end of an exhausting 5 day
travel. The two of us visited the dealer, only to find that service stations managed by him lacked all
the equipment that the company stipulated such units to have. There were no processes in place,
the performance of these stations was not being tracked and documented, and no activity had been
taking place at all. It was clear that service reports issued by this dealership had been fudged to
present a more favourable picture than was actually the case. My investigation revealed that this
dealer was functioning as a broker of sorts, which was selling without any service for vehicles. The
situation came as quite a shock to me, as up until that point, all the dealerships that I audited had
relatively good systems and passed the audit. This one would end up being my first rejection. Since
this was my first time I had to confirm with by boss.

I called my superior, the zonal manager and explained the situation to him. He offered me two
alternatives in response. The first option was to stay in that town for some days, rectify the situation
with the dealer, bring the processes at the service stations in accordance with company standards
and present a favourable report. The second alternative was to ignore the deviation and enable the
dealership to be promoted to Diamond category. The manner in which my boss communicated this,
made it clear that he would not take too kindly to a transgression being reported from his zone. He
also mentioned that it would be alright if the dealer was asked to submit the report after completing
the basic requirements.

At this juncture, pure logic and professional ethics dictated that I give this dealer a very poor score in
my evaluation, and convey the same to headquarters. It would be the ‘right’ thing to do, and I would
complete the audit with the satisfaction of having performed my duties honestly and efficiently. To
agree to him means putting myself at risk if anyone else would ever audit them later reported
otherwise. But the chance of that happening seemed significantly low then. And since it was ‘better’
for me to be on the good books of the guy too made this option attractive. After all, having a low
tolerance for outliers such as this dealer could not be good for the performance of the organization
as a whole, I believed.

However, presenting a bluntly honest report would have put me at loggerheads with my close
friend, the territory manager for this area, as well as the zonal manager. I was also concerned that
flagging this dealer, thereby jeopardizing the performance metrics for this area (and consequently
the entire zone) would reflect very poorly on my ability of being a team player.

After much deliberation, I decided to choose the second alternative. I gave the dealer a score that
was just sufficient for him to pass the audit. The idea of putting the team ahead, and maintaining an
amicable relationship with my boss gained prominence over my personal values. While the decision
weighed heavily on my conscience, I took the call to let this incident pass, much to the disapproval of
some colleagues who came to know about it.

I used to feel bad during that period thinking that I had done something wrong. I believe that my
decision, in hindsight, while misaligned with my personal values, allowed me to cross a bottleneck
for my team. The market was in a way not that big. It was mostly a competitor strong broker-market.
We brought this broker and it was alright with not providing a service there. The entire team knew
about it and was ignored. Have I had reported the digression, the broker could have left and started
selling competitor vehicle.

Fortunately for me, the audit reports did not reflect any misrepresentation of on-field conditions on
my part. The truant dealer, however, was forced to upgrade his dealership facilities. The fact that I
did not flag this dealership averted unwarranted scrutiny of our team which otherwise fared well,
and enabled us to streamline our efforts and in the long run ended up being a win-win for both
sides.

In light of my learnings in this course, I think that if faced with such a dilemma again, my response
would remain the same. But the way I would have felt about it would have changed. I have been
raised to value integrity and honesty in times of conflicts. However, my professional experience has
shown me that managers need to strike a middle ground between personal ethics and the interests
of the firm. While not every decision we take might sit very well with our conscience, it is
nevertheless necessary to choose a path that takes the interests of all the stakeholders into account.
When I look back, I feel that my actions were right even when I haven’t thought the situation then.
The reading on the four commandments resonated with me when I read through it. I understood
that some situations could be equally right and wrong at the same time.

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