Running head: UNIT 5 – INDIVIDUAL ASSIGNMENT - ETHICS AND CULTURE

Unit 5 – Individual Assignment - Ethics and Culture

Michael Deimen

University of Wisconsin – Platteville

Project Management 7040 – Managing Virtual and Co-located Project Teams

02 May 2015

Assignment

Take one of the following scenarios and evaluate the possible approaches. Also, consider whether they would be handled differently on a collocated team or on a virtual team. For your chosen scenario, assess what cultural factors may be involved and how you would determine what actions to take, and what additional information or learning you may need before taking action. As a guideline your paper should be three to five pages.

Scenario 2: You are part of a project team working on a project that requires certain licenses or permits to be obtained in a non-U.S. country in order for the project to proceed. A member of the project team based in that country advises the team that in order to assure the permits are obtained in a timely manner, a small unofficial "fee" should be given to the administrator who is in charge of issuing the needed permits or licenses.

UNIT 5 – INDIVIDUAL ASSIGNMENT- ETHICS AND CULTURE ii

ContentsIntroduction.................................................................................................................................................1

Approach to Determining Appropriate Actions...........................................................................................2

Cultural Implications....................................................................................................................................4

Virtual vs. Collocated Teams.......................................................................................................................5

Conclusion...................................................................................................................................................5

References...................................................................................................................................................6

UNIT5– INDIVIDUAL PROJECT - ETHICS AND CULTURE 1

Introduction

The scenario proposed has the potential to expose questions involving cultural custom,

regional norms, local laws related to graft and bribery, and international trade laws. It may also

reveal inherent beliefs held by the project manager, the team, and the organization concerning

personal ethics, philosophies of business and fair conduct of day-to-day operations.

Of particular concern in this scenario is its relationship to the Foreign Corrupt Practices

Act (FCPA) that essentially makes it illegal for any United States citizen to pay a foreign official

for purposes of facilitating business activities on behalf of either him or herself, an employer, or

an intended foreign business partner. The act recognizes a difference between 'bribery' and

'grease payments' (payments made to an official or functionary to accelerate the initiation and

completion of tasks he or she is required to perform in the course of his or her job) and allows

that such payments may be considered legal if they comply with the laws of the host country

(Lorandos Joshi, n.d.).

It appears as well that the use of 'grease payments' has precedent within our own borders.

As Jones, (2007) recounts, "In the United States, for example, paying to have a routine

governmental service expedited is a perfectly legal transaction. But in Russia, the same payment

is considered an illegal bribe."

This paper will recommend a process for gathering sufficient information to make

appropriate recommendations for actions, discuss the issues involved, and compare the potential

implications suggested by use of both virtual and collocated teams.

UNIT 5 – INDIVIDUAL ASSIGNMENT- ETHICS AND CULTURE 2

Approach to Determining Appropriate Actions

While the team member advising payment of a "fee" may be well informed and

trustworthy, the Project Manager's first responsibility is to protect the interests of the employer

and ensure that it is acting in legal compliance with all applicable laws in both the host country

and the U.S. This will serve to protect both the company's immediate financial interests and its

reputation abroad. This is particularly important because reputation is a valuable asset, which

once lost, is difficult to recover. It is incumbent on the Project Manager to know and understand

all the facts concerning relevant legal requirements. It may serve both the team and the company

well to retain the services of a 'due diligence company' (DDC). DDCs have emerged in the wake

of the laws like the FCPA as a means of outsourcing the challenging process of researching the

legal statutes applicable in foreign countries as well as the status and background of the parties

involved. This ensures that all relevant laws and regulations are known, understood and attended

to, that proper documentation is filed where and when it needs to be, and that the intermediaries,

officials, or 'administrators' dealt with are just and only who and what they claim to be so no

unintended violations occur. It also serves as a defensive bulwark in the event that some surprise

does occur and it becomes necessary to prove in court that the company made appropriate good

faith efforts to ensure they were acting in a legally compliant manner with people who they had

every reason to believe had no history of unethical behavior.

Once a firm understanding of the relevant laws has been established and the identities and

status of the parties involved confirmed it becomes necessary to educate the team, in particular

the team member(s) responsible for managing foreign activities, around what is both legally

permissible and in keeping with the corporate code of ethics. It will be necessary as well to as

attorney Igor Abramov, counsel at Canadian law firm Heenan Blaikie suggests,

UNIT 5 – INDIVIDUAL ASSIGNMENT- ETHICS AND CULTURE 3

"...communicate (the) standards to... contractors and supply chain partners. Then, they

must verify that those standards have been understood. If suppliers feel pride that they're

part of a great company, they start acting that way. That process begins by obtaining

written statements from subcontractors outlining their commitment to principles such as

specific labor standards, policies and expectations—and ensuring they receive a

commitment from their subcontractors as well" (As cited in Jones, 2008).

It may also be useful for the Project Manager to secure access to on-line ethics training

for the team and make its attendance a requirement for each team member, or, in lieu of that,

"create a PowerPoint presentation that details legislation applicable to the project" (Curlee,

2009).

Project managers would do well to consider these issues early in the course of a project.

This will prevent delays and allow the team to prepare well in advance for the challenges of

working in other nations. The project plan, the schedule, and the risk analysis will all benefit

from this foresight. In consideration of this early analysis Wanda Curlee, Adjunct Faculty at

North Central University and Senior Manager at Deloitte suggested the project manager consider

the following questions:

Are legislative requirements built into the project management methodology that I am

using?

Do I need to create processes/procedures to enforce the legislation?

Do I need to provide training for the project team members on ethics as it pertains to this

project?

Which legislation is applicable to the project (e.g., is the project global or domestic)?

UNIT 5 – INDIVIDUAL ASSIGNMENT- ETHICS AND CULTURE 4

Will cultural norms be an issue in other countries (e.g., is bribery commonly used to

conduct business)?

Does the company I work for have a code of conduct/ethics that all employees must

adhere to? Are the vendors/subcontractors required to adhere to the company's code of

conduct?

Does the company have a culture that will help or impede ethical behavior on the project?

(Curlee, 2009)

If the project involves construction in a foreign land, "before choosing a site location,

companies should examine local licensing and regulatory requirements, tax-collection systems

and intellectual property laws to get a sense of how the government functions. The strength of

the court system can often provide a gauge of the country's ability to deal with business disputes.

(Jones, 2008)

Cultural Implications

Conduct of business in foreign lands frequently requires finding the balance between

what is legal and what is expected. As noted in the Introduction section of this document,

payment of fees to facilitate speedy execution of necessary legal filings is acceptable if the local

laws permit. Outright bribery to ensure an outcome in violation of local, regional, or national

laws is not. Recognizing regional tradition and norms can ensure both timely completion of

necessary activities and good will on the part of the local authorities. Hiring local residents to

fill necessary jobs can also help to build good will and invest the local population in the success

of the enterprise.

UNIT 5 – INDIVIDUAL ASSIGNMENT- ETHICS AND CULTURE 5

Virtual vs. Collocated Teams

The challenges described above and the steps required to navigate them may in fact be

more easily manage on a virtual team if the appropriate team functions and expertise are resident

within the host country. Having team members on-site with first-hand knowledge of local

customs and a firm command of the local language is a huge advantage.

Collocated teams will must, by necessity, send team members overseas to confront these

issues or retain the services of local professionals. Talented professionals on the team may

overcome these challenges, but either strategy may impose a significant increase in complexity,

cost, and risk to the enterprise. "Without extensive experience in a region, it can be difficult for

project leaders to differentiate a cultural nicety, such as an invitation to dinner, from a true

ethical dilemma, such as a bribe" (Jones, 2008).

Conclusion

Conducting business in a foreign land can be a challenging undertaking for any company

regardless of size or complexity. Foreign laws and cultural norms are often at odds with

domestic or corporate policies and even international standards. An innocent misunderstanding

can quickly metastasize into a costly legal entanglement or worse, a brand damaging public

embarrassment. Project teams distributed around the globe often function as the face of the

company in business-to-business activities and what they do reflects directly on both the brand

and its leadership. Ensuring their activities are informed by the values and ethics embodied in

the corporate code of conduct aligns their undertakings with leadership's intent.

Rarely do project teams have the expertise and experience to navigate all cultural and

legal issues alone. In the end, the better part of wisdom may be to retain reputable professionals.

UNIT 5 – INDIVIDUAL ASSIGNMENT- ETHICS AND CULTURE 6

References

Curlee, W. (2009). Proceedings of PMI global congress 2009:Ethics and the virtual project

manager. Orlando, FL. Retrieved May 1, 2015, from

http://www.pmi.org/learning/ethics-virtual-project-manager-6709

Jones, T. (2008). Code of conduct. PM Network. October, 2008. Retrieved May 1, 2015, from

http://www.pmi.org/learning/code-conduct-ethically-conflicting-project-2583

Lorandos Joshi (n.d.). Foreign Corrupt Practices. Retrieved May 10, 2015, from

http://www.lorandoslaw.com/FAQ/Foreign-Corrupt-Practices.shtml