Case 2 – 3 Starnes-Brenner Machine Tool Company of Iowa City, Iowa, has A small oce Of integrated sales by a single person, ran! "othe, in #atin, an important co$ntry of #atin America% &ran! has been in #atin for '( years and is retiring this year) *is replacement will be Bill *$nsa!er, one of the best sellers of Starnes-Brenner% Both will li+e in #atin for abo$t eight months, d$ring which time &ran! will $pdate Bill, pre-sit his main clients and, in general, prepare him hi m to ta ta! !e o+ o+er er th the e b$ b$si sine ness ss%% &ra ran! n! wa was s +e +ery ry s$ s$cc cces essf sf$l $l as a sa sale les s rep eprres esen enta tati ti+e +e ab abro road ad de desp spit ite e hi his s pa part rtic ic$l $lar ar st styl yle e an and d so some meti time mes s hi his s complete rel$ctance to abide by company policies when they did not s$it him% hi m% Th The e co comp mpan any y di did d not do m$ m$ch ch in fr fron ontt of it its s wa way y of pr proc ocee eedi ding ng,, altho$gh from time to time it got to get mad some directors of the company% As resident ac! McCa$ghey, retired two years ago, pointed o$t to a +ice president who complained abo$t &ran!. /If yo$ are ma!ing money, and it is 0more than any other oce from abroad1, Then do not bother him% / 2he hen n McC cCa$ a$gh ghey ey ret etiired ed,, the ne new w bo boss ss immed ediiat atel ely y int ntrrod od$c $ce ed organi3ational changes that placed more emphasis on o+erseas operations, ma!ing the company a tr$ly global operation, to which it was +ery li!ely that a loner li!e &ran! wo$ld not adapt % In fact, one of the !ey reasons Bill was chos ch osen en as a s$ s$bs bsti tit$ t$te te fo forr &ra ran! n!,, as we well ll as hi his s op opti tim$ m$m m sa sale les s ag agen entt performance, is his ability to adapt to the organi3ation%
Starnes-Brenner Machine Tool Company: To bribe or not bribe? Case analyze Differences between Fran an! Bill Fran
pays
“mordid didas”
Bill
•
Frank
to
get
•
equipm equipment ent passed passed by govern governmen mentt officials. State business will fail without the
•
“mordidas” •
payment of “mordidas”. “mordidas”. •
Believ Believes es they they are not encour encouragi aging ng bribery to spread but rather just accepting the atinos ways of doing business.
Bill absolutely opposes the idea of
Stat Statee busi busine ness ss will will be succ succes essf sful ul without paying “mordidas”
•
!o bribe is unethical.
Answers "# $s what Fran !i! ethical? By whose ethics those of %atino or the &S? Bribing is not ethical. "n this case it#s ethical for Frank$ because atino bribery is seen as normal. %hat did Frank not justified$ since no matter the part of the world in which they do$ bribery is totally unethical. 2# 're Fran(s two !ifferent payments le)al *n!er the Forei)n Corr*pt +ractices 'ct as amen!e! by the ,mnib*s Tra!e an! Competitieness 'ct of ".//? !he first payment of Frank is legal$ because as a payment to the chief of the border workers to e&pedite the transfer$ the statutes concerning the payment of these have softened. !he second payment to government officials$ to repair the machines is illegal. 3# $!entify the types of payments ma!e in this case0 that is1 are they l*brication1 etortion or s*bornation? "n both case$ the types of payments are identified subordination because subordination is defined as someone with corrupt money$ gifts or some kind of favor$ in order to get something for that person. # Fran seeme! to imply that there is a similarity between what he was !oin) an! what happens in the &S# $s there any !ifferent? 4plain# Frank says that when you have big dinner parties where different treatment or close businesses and stakeholders pay the bill$ is a tipe of bribery. !he different is that in the 'S these are normal business dinners and atino bribes are large amounts of money being paid directly. 5# 're there any le)al !ifferences between the money pai! to the !ocworers an! the money pai! the 6efe 7)oernment official8? 'ny ethical !ifferences? (es$ there are legal differences. First$ the payment to a government official is illegal$ while bribery dock workers are considered legal under Foreign aw on )orrupt *ractices. "f we analy+e the ethical part$ there aren#t differences$ because it evades honestly and in both cases there is bribery. 9# Frans attit*!e seems to imply that a forei)ner m*st comply with all local c*stoms1 b*t some wo*l! say that one of the contrib*tions ma!e by &#S# firms is to chan)e local ways of !oin) b*siness# ;ho is ri)ht?
!he reality of the world tells us that when we enter or do business in other countries$ we must know their culture$ their traditions$ their profile negotiator$ among other things. !his doesn,t mean that we have to mold it entirely. !here is a difference between adapting to certain rules or customs and depend or be enslaved them.
'.S. companies are trying to establish a new business system$ without bribery and honest practices$ regardless of whether the country you,re working with is illegal working methods$ make use of bribes and this is seen as normal.
-thics must be above everything.
<# Sho*l! Frans behaior hae been any !ifferent ha! this not been a )oernment contract? Frank,s attitude would have been different$ as with any client$ ethical principles should be the same. Bribes not be admitted under any circumstances. /# $f Fran sho*l!n(t hae pai! the bribe1 what sho*l! he hae !one1 an! what mi)ht hae been the conse=*ences? Frank had to wait for merican mechanics or find another solution within the same country. "f " had done this$ you probably would have lost the client and their profits$ but had established a more clean and proper business conduct. .# ;hat are the company interests in this problem? %ithin the policies of the company there is no possibility of bribing$ but if this happens$ as in the case of Frank$ former president of the company preferred to skip this$ because he gave more importance to the profits it was generating Frank$ no matter how it was generated. "># 4plain how this may be a )oo! eample of the SC 7self-reference criterion8 at wor#
Frank has a reference about himself and his way of manage the business$ and he thinks that he is the best doing his job and that the others are wrong$ but he doesn/t know that he is making a mistake doing the things without ethics.
!his is a perfect e&le of the S0)$ because he closed his view to himself and nothing else$ and belittles the work of the other people.
""# Do yo* thin Bill will mae the )ra!e in %atino? ;hy? ;hat will it tae? Bill will succeed in atin as honest working methods establish and implement the strategy that worked well in the 'nited States. 1e will need strong strategies based on cost or differentiation to compete healthily without bribes. "2# @ow can oerseas mana)er be prepare! to face this problem? ny manager that aims to work abroad in the future$ you will need e&cellent training. !his training should address issues such as practices$ norms$ lifestyles$ culture$ etc..$ the country where you are going$ so that when e&ercising$ that person can know what will face problems and scenarios. (our skills and abilities will give you the tools to resolve conflicts that may arise.
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?b https233www.coursehero.com3file3@A@=AA93case8study8798im3 https233pre+i.com39+&>hpgknkb+3to8bribe8or8not8to8bribe3 Case St$dy 4%5 6 Starnes-Brenner Machine Tool Company '% Is what &ran! did ethical7 By whose ethics8those of #atino or the 9nited States7 Before yo$ decide whether or not it is ethical, yo$ ha+e to decide by whose ethics yo$ are :$dging $pon% In the 9nited States, what &ran! did was illegal and $nethical% *owe+er beca$se it was done in #atino, where pro+iding a little l$brication to get things mo+ing is a c$lt$ral norm, &ran!;s actions where perfectly
4% Are &ran!;s two di=erent payments legal $nder the &oreign Corr$pt ractices Act as amended by the Omnib$s Trade and Competiti+eness Act of '>??7 &ran!s
Inside Scoop of B$siness in #atino Speci
Ei+ing them gifts #obbying &ran! tells Bill his
'1 Bribing is not something that is accepted as ethical anywhere in the world and that is Bills +ision% &or &ran! if he sees it as ethical beca$se it accommodates the c$lt$re of the co$ntry and that for #atinos this is correct and normal, b$t gi+en that way of thin!ing can :$stify many atrocities committed in history as those in+ol+ed were con+inced they were right An etreme case wo$ld be *itler and his sla$ghter of ews%
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