Thursday, November 26, 2015

Oracle: A Controversial New CEO (2014)

Oracle Corporation logo
This case involves a long time reputable employee resigning from the company. The man replacing him, Marc Hurd, is known for past behavior that is not reputable. Mark Hurd was allegedly involved in multiple scandals as CEO of HP and damaged the reputation of the company. Stock for HP plummeted after Mark Hurd’s departure and it took several months for the company to get back on its feet. Shortly after this incident he was then taken in by Oracle as co-president and has since been a strong asset of Oracle’s success. Despite Marc Hurd’s past actions, Oracle was willing to give him another opportunity to restore his career. Marc Hurd was then named co-CEO of Oracle several year later. This lead to criticism from the press, as he has not been CEO since his stint at HP. It also lead to stockholders losing trust in the company and withdrawing their support for the company. There is speculation that this is a scheme for Mark Hurd to restore his reputation and look to redeem his position of being a CEO of one of the biggest companies in the world. It is now up to Mark Hurd, to regain the trust of the public or to waste his opportunity with another mistake. Mark Hurd is looking to change his status with the public and to lead Oracle to be a prosperous company in the industry.

The stakeholders are the CEOs who make key decisions. These decisions directly impact the other stakeholders such as executives, employees and stockholders of the company. Mark Hurd and Safra Catz are co- CEOs and will make decisions that will affect the direction of the company. This will be responsible for the success or the failure of the company. Larry Ellison has stepped down to be the Chief Technology Officer of the company. He makes decisions on what type of technology should be distributed and what innovations to made to better the products. Jeffery Henley is the Vice Chairman of the Board. He supports the CEOS on their duties and may replace a chairperson in place of their absence. Reggie Bradford is the Senior Vice president of product development. He runs the steps to efficiently produce the product to maximize the profits of the company.


Mark Hurd, CEO of Oracle Corp, known for his scandals
while working with HP

Individualism states that the only objective of a business is to maximize profits and to increase the value for the stockholders. A business must be responsible in their actions to gain a profit for their investors. Individualism is important in my case as it deals with the decision makers of the company. The CEOs of Oracle make decisions that directly affect the stakeholders of the company. This is why it is crucial to make the right decisions in order to keep the company in good standing. The controversy surrounds Mark Hurd as he was involved in a previous scandal which negatively affected the stakeholders. He is looking to restore his name and lead the company to success under Oracle.

Utilitarianism states that happiness is the only thing that is important. It encourage to spread happened toward others, this makes the individual happier about themselves. It is important for Mark Hurd to implement utilitarianism as it creates an environment of happiness throughout the company. This makes it more likely for stakeholders to make decisions that will grow the company to success. If a wrong decision is produced, the state of happiness may not be present in the company As positive results come through, there will be a reinforcement of happiness in the company. This creates a sense of sustainability throughout the company to keep spreading the happiness of other by taking the right course of actions.
One should practice acting in a moral fashion by respecting others, their autonomy, and their different outlooks. An individual must be motivated to do what is right and to promote good will within a business. Kantianism has a lot do with the controversy as Mark Hurd is criticized of being immoral. His past behavior shows clear signs of immoral and irresponsible behavior. This harmed the company he was in and led him to be fired from his position due to the multiple scandals he was involved in. Kantianism is the key for Mark Hurd to reestablish himself as one of the top CEO’s in the technology sector. It is more difficult to have practice Kantianism when one has already broke the laws of being immoral. This is why it will take time for Mark Hurd to regain the trust of the investors and will have to show that he has now changed for the better and will have to make decisions that positively impact the company.

Virtue Theory 
Oracle Corp. headquarters in Redwood City, CA

The Virtue theory states that one must be willing to take risks in order to grow in business. There must be courage within to stand behind these decisions when the outcome is revealed. One must also be honest in their actions. Mark Hurd must implement these traits into his business regimen in order to be successful. The virtue theory gives the company the right traits to perform in an honest and moral fashion. Investors may see the behavior of company as virtuous and may gravitated by this new way of business. Mark Hurd will gain respect for establishing a moral attitude throughout the company. He needs to channel the pressure from the media and do his job based on the virtue theory. Mark Hurd may have to work harder in order to sustain a virtue in his decisions, but it will be rewarded in the long run with success and praise from the stakeholders.

Justification Ethics Evaluation
This situation with Mark Hurd would all be avoided if he were to be motivated to making the right decisions in the business world. He should have thought about the outcome of his actions before getting involved in a troubling scandal that hurt the reputation of his company and his career. There will always be criticism of his actions throughout his career because of his past. It is now up his new position as co- CEO of Oracle to turn his reputation around. Mark Hurd must focus on being motivated to make the right decisions as they will directly affect the stakeholders of the company. Oracle will be monitored closely by investors and stockholders, so it is Mark Hurd’s job to lead the charge in continuing Oracle’s success in the technology of relational databases.

Oracle is a company that put it's trust into Marc Hurd. He needs to see that he has an opportunity by having a second chance in life and to learn from his mistakes. Marc Hurd must take advantage of this chance and be the best CEO he can be for Oracle. Marc Hurd must implement utilitarianism, individualism, Kantainism, and virtue theory to be successful. These attributes will create a culture of sustainability for the company and will ensure the growth of the company.

The Walt Disney Company Layoff of Technicians (2015)

Walt Disney Company photo advertisement
The Walt Disney Company has been in the news lately but not as one would expect. Disney has been accused of acting ethically wrong in regards to the layoff that occurred in January of 2015. Disney decided to lay off two hundred and fifty data technicians who worked at The Walt Disney Company location in Florida due to reorganization of the company. But in actuality they decided to terminate the employees so they can save money in the long run. Not only were these employees let go without proper justification, they were also told in order to receive their severance pay they were required to train their replacements, which were visa workers from India that are part of the H-1B program.
The H-1B program was created in 1990 to allow U.S. employers to hire temporary foreign workers with a bachelor's degree in advanced science, engineering, or computer skills to fill positions when American workers with those skills cannot be found. Disney is required to pay the visa program workers the local wage and also provide benefits. There are however loopholes that many companies know of to get away with paying these workers less. One of these loopholes is hiring outsourcing firms to hire H-1B visa workers so technically the employer is not breaking any rules by paying these agencies less money for the visa workers. Disney decided to let go of their current hard working employees just to save money.

The stakeholders in The Walt Disney company case are as follows: the CEO of The Walt Disney Company, for approving the layoffs to cut labor costs. This move will save the company money so it affects the company directly. Next will be the executives/office managers. They are being affected by having all this changes take place that directly change the dynamics of the office. The main stakeholders that are affected by this case controversy are the data technicians that were laid off and their families.They no longer have their job, income, security, and are now having to struggle to find a job. Lastly, the H-1B visa workers, they are also being affected by this since they now have an opportunity to provide income for their families and this also can open doors for a lot of them to apply for permanent visas. 

Entertainment Technician at Walt Disney World,
one of many jobs being laid off
Disney’s sole purpose is to make a profit for the company and did just that by cutting two hundred and fifty data technician’s positions and replacing them with H-1B workers. This shift in employees will save them money in the long run by paying H-1B workers less than the American worker. Even though Disney paid the employees severance pay, they will control their spending by hiring new temporary workers that can be paid less, which will ultimately save them money. Per the Labor Department, Disney cannot pay the H-1B workers less money, but there are loopholes that many companies know of and take advantage of. Many employers hire an outsourcing firm to hire H-1B workers so technically the employer is not breaking any rules since the H-1B workers are not hired directly through them. This is how many companies get away with displacing their current employees and replacing them with H-1B workers. Technically, viewing this ethical controversy through an individualist point of view, Disney did the right thing in order to increase their profit. 

Disney did not apply utilitarianism to their business decision by not considering their employee's maximum happiness long-term. The employees were laid off without a single thought to their well-being and their families. The employees no longer had a means of income to provide for their family so Disney failed to make sure their decision did not affect any employees financially. Many are still unemployed and many were forced into early retirement which caused a shift in their lives that was not expected.

Cinderella's Castle at Walt Disney World
Disney's approach of the layoff and hiring of H-1B workers does not agree with Kantian business ethics.Disney was not thinking rationally when they decided to lay off the data technicians that worked in their Florida office. They were not respectful towards the employees, especially when Disney made them train their own replacements. As mentioned early under the Ethics Case section, the Labor Department requires all employers to provide a notice to all current employees regarding the new hires: ‘On or within 30 days before the date the LCA is filed with ETA, provide notice of the employer's intent to hire H-1B, H-1B1, or E-3 workers. The employer must provide this notice to the bargaining representative of workers in the occupation in which the H-1B, H-1B1, or E-3 worker will be employed. If there is no bargaining representative, the employer must post such notices in conspicuous locations at the intended place(s) of employment, or provide them electronically.’
Disney failed to provide this announcement with at least a 30 day notice so employees were not allowed to make sure their positions will not be jeopardized. The employees were not allowed to fight for their careers and were basically cheated out of their jobs. Disney only acted on what was a benefit to them and in turn made a bad decision that cost two hundred and fifty employees their jobs and livelihood. 

Virtue Theory
When looking at courage, Disney did not meet this trait due to the fact that they did not act ethically when deciding to lay off their data technicians in order to save money. Instead of Disney taking the necessary steps to insure their current employees were working to their standards and training those that needed a bit of help, they decided to terminate them to save more money. Disney was also not honest in this whole process. They did not give the employees sufficient warning in terms of posting or sending emails to inform everyone that H-1B visa workers would be hired. Disney was not honest when asked by the media as to their reasons to make the decision to let go of their employees. No issues were reported so they really didn’t have a justified reason to make this decision, other than to save more money. When it comes to self-control/temperance, Disney’s executives and office managers did not have the will power to take a stand against this unethical way of doing business. They allowed Disney to continue with the plan to lay off their employees in order to replace them with workers that will make less money. Disney might have thought they were doing right by making sure their financials were in good standing but forgot to consider how this would affect everyone else. Lastly, we look at justice/fairness. Disney was not fair to the data technicians and did not care as to how this would be affecting them and their families financially. Yes, severance pays were given, but there were requirements that needed to be met before those were given, such as training their replacements.

Justified Ethics Evaluation 
Rober A. Iger, CEO of Walt Disney Company
After studying the theories presented, it is clear to see that Disney did not act ethically correct when handling the layoffs of their two hundred and fifty data technicians under Utilitarianism, Kantianism, and Virtue. However, according to Individualism, they acted ethically correct since their only goal should be to make a profit, which they did by cutting labor costs.
In my opinion, there is no justification as to why Disney had to let go of their employees, especially when things have been going so well for all involved. Disney should have never laid off their employees to replace them with visa workers from the H-1B program. If they wanted to take advantage of the program they could have used their services elsewhere, where they were needed, instead of cutting American jobs to then give it to someone else. Disney has not made any comments to justify their actions so one can only assume it was to save money for that department, which is clearly a breach of their agreement with the Department of Labor, as discussed under the Ethical Case section.

Works Cited
American Immigration Council (2015). The H-1B Visa Program: A Primer on the Program and its Impact on Jobs, Wages, and the EconomyRetrieved from 
The Walt Disney Company. Retrieved from 
Thibodeau, Patrick (2015). Fury rises at Disney over use of foreign workers. Retrieved from  
United States Department of Labor (2015). H-1B Program. Retrieved from  
Zarronandia, Jeff (2015). Senator Calls for DHS Investigation of Visa Program After Disney Layoffs. Retrieved from 

Wednesday, November 25, 2015

Johnson & Johnson-Risperdal: Manipulation and Deceit for Profits(2015)

Case Study
Johnson & Johnson(J&J) has been one of the most trusted brands in the world for a very long time and its name has come to be synonymous with quality. Going back over 100 years families have trusted J&J products in their households to do everything from washing their hair to relieving their pain. Since its inception in 1886 Johnson & Johnson has created a great number of products and services, and has even branched out to the pharmaceutical industry. The pharmaceutical company they own is called Janssen Pharmaceutica, and much of this controversy will result from their practices within the Janssen branch of the company, which is a subsidiary company within the J&J corporate structure(Pollack1)

Risperdal 2mg tablets
Ethics Case Controversy
In 1986 J&J's biggest money making drug Haldol was coming off of patent, which meant that it would soon be undercut by generic versions and they would be losing the enormous profit the drug had brought them. So the company set out to find a new blockbuster drug which could be under patent for years to come and came up with a drug they named Risperdal. This new drug was extremely powerful, physically addictive, and had a litany of side effects, however it was very effective in treating severe psychotic episodes in patients with bad mental conditions. Risperdal would gain limited FDA approval in 1993, but only for severe psychotic disorders. This approval meant that for J&J the drug was legally only marketable to about .05% of the population, which greatly limited its ability to make money. The corporate executives at the company had visions of selling the drug to 5-10% of the population, and through their actions they made it clear they were going to do whatever they could to make this vision a reality. 
Effects Risperdal had on children in early trials

Effects on children in early trials:
J&J conducted a great deal of studies to learn about the effects of the drug and to figure out just how bad the side effects were; the results of this research would be horrifying. The research concluded that Risperdal caused Gynecomastia (growth of female breasts on boys) in over 5% of cases. It also found that the drug causes early death in a great deal of elderly patients. Instead of releasing this information to the public J&J kept it secret and ignored the results. This is an enormous violation of the ethical honor system that existed between pharmaceutical companies and the FDA(Brill). They would apply to the FDA in 1995 and 1996 asking for the label approval to be expanded to include adolescent and elderly patients, and the FDA would subsequently deny their applications multiple times. 

J&J still held on to the belief that they could turn Risperdal into a blockbuster drug, despite the warnings of researchers. They had a problem though and the FDA wasn't budging on the label expansion requests. So they set out to create a massive marketing program to advertise to doctors for off-label use of the drug. Off-label use is when a drug is used for a condition other than what the FDA approved it for, and this use is completely at the discretion of each individual patients doctor. The advertising rules for off label use are much stricter and advertising directly to patients is against the law(Bioworld). In 1998 J&J set up an "ElderCare Center" staffed by 83 people to cater towards marketing the drug to the elderly care centers for off label use. J&J wanted to make Risperdal a household name used by people all over the country, for conditions as simple as ADHD or aggressive behavior in the elderly. They marketed the drug as a treatment for young children that wouldn't behave and set up marketing teams to convince pediatricians the drug was a good option for their patients. One of the advertising sets they gave to nursing homes read "Hostile on the outside, fragile on the inside"(Pollack). At one point the FDA even steps in a rejects promotional material that J&J had intended to distribute. They do all of this knowing full well the high likelihood of negative effects that the drug has, especially on the most vulnerable patient demographics: adolescents and elderly.

By the time that 2007 rolled around Risperdal sales had reached over $3 Billion a year and they had successfully expanded their market to include millions of adolescents and elderly patients(Brill). The drug was a Blockbuster just like the company had imagined. Only problem was that their were tons of cases all over the country where people had experienced severe side effects from the drug and their were long lasting damages they had sustained from the drug. From extreme breast growth in boys, endocrine system damage, and kidney and liver damage, to Elderly patients dying of heart and liver problems, the drug had caused a great deal of damage. Johnson and Johnson had succeed in their aggressive marketing strategy, but they had violated many laws and ethical codes in the process. In 2012 after hundreds of lawsuits across the country Johnson & Johnson would settle with the government for $2.2 Billion dollars. "As part of the settlement, Johnson & Johnson has agreed to plead guilty to a criminal misdemeanor, acknowledging that it improperly marketed Risperdal to older adults for unapproved uses"(Reuters). The drug had made the company a great deal of money, but they had irreversibly damaged the lives of thousands of people, and we will never know the true extent of the damage they caused.

Eric H. Holder Jr., the United States attorney general,
 said the company put at risk the
 health of vulnerable members of society(Reuters)
One of the biggest stakeholders in this controversy is the Johnson & Johnson and the J&J brand. This is a company that had a stelar reputation for over a hundred years and has responded very effectively to past controversies. So much of what makes the J&J brand so attractive to consumers is that they feel like they can trust it and feel safe using those products for their family. This breaches that trust and can really hurt the public perception of the company and they will be feeling the effects of this controversy for years to come. Another huge stakeholder is the American people. J&J is a publicly traded company, meaning that anybody is able to buy stock in the company. Due to its past success J&J stock is considered a "Blue Chip" stock and is part of just about every Americans retirement portfolio; so when the fines and settlements came down a great deal of americans were left paying part of the price through their stock in the company. Lastly, and most sadly, are the patients who took Risperdal at the encouragement of their doctors who were being aggressively marketed to by J&J. These patients often ended up suffering from Diabetes, Gynecomastia, weight gain, and even seizures (Brill2) due to taking the medication.

Individualism is moral stance that emphasizes the worth of the individual. It places an emphasis on the person over that of the establishment or the broad overall well being of the total population. From this perspective a person should do what is best for them and what maximizes their potential and what gets them the best result. This concept disregards the needs of others or what is best for them
Analyzing this case from the individualism approach is somewhat difficult due to the great differences between the stakeholders in the case. If we start by taking the perspective of the executives at the company they actually took a very individualistic outlook throughout the situation. They did what was best for their profits and for their career progress, they disregarded the negative effects that their action would have on many other people and the overall effects on society. However from the perspective of a patient taking the medication, they had their worth disregarded, and had a net negative effect on their health from this situation. Many of them will be suffering for a very long time to come and they can certainly say they were wronged ethically.

Using this approach to judge the actions of Johnson & Johnson and its executives/decision makers, we can clearly see that what they did was extremely unethical and subtracted from the greater good. The numerous health effects that resulted from the off label use of Risperdal will have effects on people for years to come, and many elderly have already lost their lives to this drug. The actions of Johnson & Johnson broke the inherent trust that had been built up for over 100 years between the company and the people. In the future potentially lifesaving medication will be less likely to be approved by the FDA because of the abuse of the system J&J committed. Doctors will be less likely to believe a company when they tell them a certain drug can greatly improve a person’s quality of life. From the utilitarian perspective everyone involved from the decision maker side acted extremely unethically and showed a complete disregard for the overall greater good of the people, and showed that they were completely willing to put profits ahead of ethics.

Virtue Theory
Looking at this situation under this ethical theory is interesting because of the stakeholders involved, and because we don’t know for sure what their motivations always were. There seems to be a time where the intention of the decision makers was to help people, and for a long time the company fostered the virtues of caring and self-control in the face of profits. It seems like the corporate culture at J&J took a turn for the worse around the time they introduced Risperdal, and from there they continued to reward executives for finding new ways to sell more the drug in the face of damaging study results. Through their actions they showed that they had changed to value character vices such as Selfishness, Greed, Callousness, and over the top competitiveness.

Kantian ethics places great emphasis on a persons intentions- and the morality of an act is determined by the intentions that were behind it. The intentions of many of the stakeholders in this case were not ethically sound, in fact they were very morally reprehensible to say the least. For many of the employees of Johnson & Johnson and the subsidiary Jansenn Pharmaceuticals they made the conscious decision to value making money and meeting sales goals over trying to help people with their drug. Their intentions were unethical, and therefore there acts were unethical.

Justified Ethics Evaluation
In my opinion the actions of the decision makers at Johnson & Johnson are despicable, they show an unrivaled amount of callousness and selfishness and truly represent the worst that corporate America has to offer. Out of all the ethical theories presented it is very hard to find any logic where the actions of these people were ethical or acceptable. The truth is that these people made a conscious decision to put profits and their own individual success over the health and well being of millions of people all around the world. It should also be mentioned that this is completely contrary to their own moral “Credo” code of conduct(Our Company1). Not only did they not tell the truth about Risperdal, they purposefully concealed the truth knowing full well what the consequences would be. They knew from the dozens of studies they had commissioned that Risperdal was not safe for the Elderly; that it caused heart attacks and stroke and had a high rate of early death. They also knew from these studies that Risperdal was not safe for Adolescents; that it caused boys to grow female breasts (One 13 year old developed 46DD breasts)(Brill3) they knew that it caused Diabetes and endocrine problems, and a litany of other issues. Yet none of them took any steps to slow down their aggressive doctor marketing schemes or their misleading advertising in which they were spending millions of dollars to distribute across the country. 
The "Credo" located at the entrance of J&J main offices

I believe that what should have happened is that after the first study was presented to them that showed the 5% chance of Gynecomastia and high risk for diabetes they should have completely halted sales to adolescents and stopped marketing to pediatricians until further studies could be completed. If they had done what they were supposed to do according to their own ethics "Credo" code, and put the patient first, then they would have never tried to get elderly or young children to take the drug in first place. The warnings from the FDA should have been the first warning sign and the company should have listened when they were told not to market to adolescents and to elderly.

Works Cited
Brill, Steven. "The Credo Company." The Huffington Post. Web. 22 Oct. 2015.
DesJardins, Joseph R. An Introduction to Business Ethics. 3rd ed. New York, NY: McGraw-Hill                                    .         Higher Education, 2009. Print.
"Johnson & Johnson to Pay $2.2 Billion to End U.S. Drug Probes." Reuters. Thomson Reuters,                     .         4 Nov. 2013.Web. 20 Oct. 2015.
"Our Company." Our Credo Values. Johnson & Johnson. Web. 20 Oct. 2015.
"Off-label Use: The Fine Line Between Illegal Promotion and Useful Information." BioWorld.    .         Web. 26 Nov. 2015.