Implications of Unethical Behavior-Apple Inc. Battery Crisis

Implications of Unethical Behavior-Apple Inc. Battery Crisis

Hello, welcome to this presentation on business ethics. In it, I’ll discuss the implications of unethical behavior by reviewing a case study of Apple’s Inc. Battery Crisis.

Introduction to Business Ethics

According to Koslowski (2011), ethics refers to the standards of behavior to which people hold themselves in their professional and personal lives. On the other hand, business ethics is the conduct by which organizations or businesses and their agents adhere to the laws and respect stakeholder rights(Herring, 2017). Conducting business professionally requires choosing to be a professional of integrity, which implies using sound ethical practices that meet a company’s mission, culture, or policies beyond and above legal responsibilities. Business ethics also emphasizes the importance of professional integrity, demonstrated by adopting a single ethical code. Ethics is also connected to profitability because it dictates the business strategies an organization uses to increase profits.

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Historical Summary of the Organization

Apple company was founded by Steve Wozniak and Steve Jobs on April 1 1976. However, Steve Wozniak left the company in 1983 because of diminishing interest in the daily running of the company’s computers. After this, Steve Jobs hired the company’s first president, John Sculley. The company is doing well and recorded its highest profits in 1990, but there was a decline in market share after this. The situation, however, improved after the company partnered with Microsoft and introduced Mac, which gained recognition as one of the best versions of its office software.

Unethical Business Practice Examined

In 2017, iPhone users began complaining that their phone’s software update slowed down the performance of other phones (Ben DiPietroWall Street Journal,2018). The company knew that this would happen because it was focusing on eliminating old phones in the market but failed to inform its clients. The software was intentionally programmed to reduce the performance of the phones so that clients could purchase upgraded phones that cost more than what they were using (Spence,2018). At first, the company did not comment on the issue but later acknowledged that the update reduced power demands, and researchers uncovered slowdowns. It, however, denied that the high discharge rates were for financial gain.

Unethical Behavior Facts

Customers who experienced the issue before 2018 were eligible for a settlement from the company. Customers with an iPhone 6, 6 Plus, 6S, 6S Plus, or SE that ran iOS 10.2.1 or later before December 21, 2017, who experienced decreased performance, were eligible for a $25 payout (Hartmans, 2020). iPhone 7 or 7 Plus users may also be eligible for the settlement if the device was running iOS 11.2 or later and they experienced diminished performance before December 21, 2017. Customers had until October 6, 2020, to submit a claim.

Ethical Standards in Business

The application of ethical standards in business requires the business to ensure that the business operates responsibly without harming the people around it, that there is trust between the business and its customers, the business respects the clients and community around by adhering to its values and beliefs, expresses care by meeting the interests of clients and operates in affair manner without engaging in activities that meet business interests at the expense of the community and clients. Ethical standards in business also focus on applying a framework that monitors governance, customer relations, labor standards, supplier management, health and safety, environmental impact, and community relations.

Why This Practice Was a Violation of Ethical Behavior

The practice violated responsibility because the company did not inform its customers about the effects of installing the updated software. The company was also not responsible because it took a lot of time to respond to the issue. The company also violated fairness by putting its interests first based on the fact that it intentionally slowed down the devices to force customers to purchase others, hence increasing sales and profitability. The company also failed to apologize to affected customers, violating their care and respect. The company additionally violated trustworthiness by providing a false justification of why the devices were discharging at a high rate after updating the software because the main reason behind the high battery drainage was financial gain because customers would purchase other phones.

Influence of Leadership Regarding this Behavior

Apple company’s leaders influenced the unethical behavior by promoting it. To begin with, they failed to cultivate ethical behavior in the company by introducing changes that would have a negative impact on customers without informing them. They also insisted on putting the interest of the company first by providing a false justification for their actions and intentionally increasing the battery drainage down old phones to eliminate them from the market. The leaders at Apple company also insisted on saving the company’s reputation by failing to admit that the high battery drainage move was for financial gain. After the issue dominated the public domain, the leaders were not apologetic and instead offered to pay affected customers. They also only confirmed that they were aware of the issue after too much pressure from customers.

Related Cultural, Environmental, and Legal Implications Related to the Behavior

One of the main legal implications related to Apple’s unethical behavior is legal issues resulting in the payment of high legal fees, as customers could sue the company because it did not inform them about the impacts of the software update on the performance of their phones. The second legal implication is paying government fines. The company ended up paying $113 million to settle the lawsuit arising from its unethical behavior(Romm,2020). The third legal implication is losing the business operating license. This could have happened if the company had failed to respond to the issue on time. The main cultural and environmental implication is looking for goodwill from the community because people would lose trust in the quality of the company’s products. The company would also suffer a bad reputation because of putting its interests over the interests of its customers.

Impact of the behavior on individuals, the organization, and society

One of the main impacts of the behavior on the company was reduced market share because customers were not willing to purchase iPhones to avoid being disappointed and not getting value for their money. The company also experienced a reduction in sales because customers were reluctant to purchase iPhones until the issue was addressed. This, in turn, reduced the company’s profitability. The company also experienced a reduction in competitive advantage because competitors were offering high-quality products, and the company had already compromised the quality of its products. The company also developed a poor reputation because of inconveniencing customers who were using the affected iPhones.

The Outcome of the Event and Comparison of Consequences

The main outcome of the event was a lawsuit that ended with the company paying $113 million to settle the case (Romm,2020). The customers affected by the issue were eligible for a $25 settlement from the company if their iPhones experienced issues as a result of the batterygate issue. The company was also required to issue transparency documents about how it reduces performance. Even after the event, the company continued to face attacks from the press due to how it responded to the issue because many press members were convinced that the issue was motivated by the need to gain financially.

The consequences of the event are similar to what could occur if a company is accused of interfering with the quality of its products to force customers to upgrade to a better version without informing them about the disruption in the normal functioning of their devices.

Fairness of Punishment

In my opinion, the punishment given to Apple Inc. after the event was fair because it met the company’s interests and the interests of the clients. Affected clients would receive monetary compensation and could use this money to purchase new phones, and the company would continue operating normally. The punishment was also fair because the offender, who was, in this case, the company, faced the unpleasant consequence of paying $113 million. The offense against the customers was also considered, and the company could only maintain normal operations after paying the fine hence enhancing the fairness of the punishment.

Organizational Policies and Procedures to Deter Future Occurrence

Organizations can create an ethical code of conduct outlining required ethical practices in the organization, especially those concerning governance and customer relations. Organizations can also prevent unethical behavior by implementing internal controls for behavior regulation that set boundaries that employees should not cross. Organizations can additionally create straightforward guidelines on what employees are required to do to avoid unethical behavior arising from a lack of clear directions. It is also important to test the software before introducing updates to determine any negative impacts and eliminate them. Employees and leaders should also be held accountable for unethical behavior to deter them from activities that could be considered unethical.

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Now is the time to compile all the concepts you have learned in this course into a comprehensive case study analysis. Assume you are an instructor presenting an unethical case study to your graduate students. Develop a PowerPoint presentation on a business of your choice, highlighting unethical business actions that occurred from 2015 to the present. Be sure you include clear examples to support your findings. Address the following key components for your student audience:

* Provide a brief histor

ical summary of the organization.
* Identify and explain the unethical business practice examined.
* Reflect on ethical standards and why this practice violated ethical behavior.
* Determine the influence of leadership regarding this behavior.
* Explain any related cultural, environmental, and legal implications of the behavior.
* Interpret the impact of the behavior on individuals, the organization, and society as a whole.
* Explain the outcome of the event or events, along with a comparison of the consequences (mention legal implications for the action).
* Determine the fairness of punishment. Explain your rationale using ethical theory, as found in the literature, to justify your rationale for the punishment’s fairness.
* Explain how organizational policies and procedures could be implemented to deter future occurrences like this from happening.

Incorporate appropriate animations, transitions, and graphics,

as well as speaker notes for each slide. The speaker notes may comprise brief paragraphs or bulleted lists and should cite material appropriately. Your speaker notes serve as the video’s transcript.

Also, prepare a brief handout that your audience could take with them. Include recommendations for responsible and ethical strategies based on organizational consequences of unethical behaviors. You may include these in the form of a table or chart.

Support your presentation with at least eight scholarly and professional resources. In addition to these specified resources, other appropriate scholarly resources may be included.