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Commentary on the Case of the Supplier

Thomas Shanks, S.J.

As the story of the Sole Remaining Supplier was told to me, the Board conversation went pretty much the way the case describes it. Legal was saying, "This is a time bomb waiting to happen. Why are we even talking about this?" Engineering was bemoaning the lack of standards for testing the electronics of pacemakers, and the majority of the Board understood that they had a problem with no easy solution.

One of the people on the Board told me later that the founders of Silicon Valley were the sons (and a few daughters) of blue-collar parents. Their fathers were plumbers, electricians, and carpenters, who had passed on a core set of values to their children. This was the Valley before greed and early retirement (at the age of 30) had swept through it. So they took seriously their responsibility and duty to protect the rights of people who needed pacemakers at the same time as they balanced their fiduciary responsibility to the current company. They understood that "doing the right thing" did not have to be stupid, and that they could both do the right thing and do well for the company ("DO RIGHT" AND "DO WELL," rather than having to choose one or the other.)

So, they continued to sell to the pacemaker company. But they also instructed their engineers to develop more rigorous testing and technical standards they could hold the other company to. They reserved the right to stop selling if the other company did not improve its technical standards. They took steps to be sure they did not have a legal liability down the line and then turned it over to the other company to improve the quality of its products.

In these ways they felt they were reducing harms and maximizing utility. They felt it fair to single out the industry because it was new and standards were developing, an equal way of treating start-up industries. They felt they were showing compassion without sacrificing business, and were living out their parents' other virtues. In this way they felt that they were serving the common good, protecting people's rights to a promising new medical technology, the pacemaker.

Oct 1, 1996

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