Santa Clara University


Cases in Business Ethics

Back to Blog

Quality Management: Signing Off on a Substandard Product

Lauren's first job after graduation from Santa Clara University was working as a quality engineer with a highly respected technology company. She had to monitor the manufacturing process and make sure that all products met customer specifications. Just three months into her position, the company booked a very large deal with a strategic customer, helping establish the company's dominance in the industry.

Specifically, Lauren's company was designing a device that would be integrated into another company's product. The customer contracted out this work because they were experiencing rapid growth and cannot meet demand otherwise. They picked Lauren's company because of its good reputation and fast turnaround time. Lauren's role was to test the new device and make sure it met technical and environmental specifications, particularly functionality under extreme conditions, such as high humidity.

The test results showed that the products did not meet the quality standards agreed upon, but only by a very small margin. Her general manager instructed her to push it through anyway, stating that the risk of failure was not great enough to delay mass production. Moreover, the likelihood of the product ever being placed in such extreme situations was so small that the manager did not feel jeopardizing the contract was worth it.

Lauren spoke to her immediate boss, who worked under her general manager, and he also advocated pushing the product through to production. She was faced with the choice of ignoring company protocols or going against management. Sweeping the problem under the rug would require Lauren to sign off on a report that she knew to be fraudulent. She also knew that if she went to upper management her working relationships with her immediate bosses would be strained, maybe even preventing her success in the company. Not to mention, the company would have to delay production and possibly lose the contract.

What should Lauren Do?

Comments Comments

achandrakar said on Sep 12, 2014
If the risk of failure is considered as not great enough to delay mass production and her supervisor's are willing to in include this exception, then Lauren can sign off the report, however few important steps before doing that: 1. Document the critical analysis of the potential issue and the corresponding argument of low risk/less frequency. 2. Work with the general manager to add a note of exception in the contract or an alternate means of informing the customers about this corner case and the product?s capability of handling such exceptions. Also Project Management has an interesting concept of Change Control Board to cater to such tweaks and tits. In this method a small committee of involved stakeholders (say Quality manager, development manager and production manager) take charge of due diligence, cause and effect analysis, releasing a go or no go decision and recording the exceptions for future reference. I think it is equally applicable to manufacturing and production.
Patrick said on Sep 15, 2014
I appreciated your thoughts on documenting the decision making process. As far as the probability of failure, what benchmark should Lauren use to draw the line between acceptable and unacceptable risk?
JAMAL TAHA said on Feb 20, 2015
Since signing the report lead to fraudulent activity it is clear that it is ethical issue, so Lauren should inform her immediate supervisor in writing and keep a copy of that communication for herself and pass a copy to her general manager.
Jamal Taha said on Feb 20, 2015
I forgot to say that Lauren should not sign the report.
Sandra Pryor said on Feb 27, 2015
Lauren should follower the company protocols. Because of the company good reputation Lauren should not sign off on fraudulent information. Send an email to her immediate boss and general manager concerning the products did not meet the quality standards agreed upon, but only by a very small margin. She should think long term and the good of the company reputation.
Post a Comment

Tags: Just out of SCU, Product Issues