Central Georgia Technical College Zenefits and Theranos Ethical Issue Analysis

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Central Georgia Technical College

Description

Purpose: In this project, you will assess how two start up companies have come under scrutiny for their actions in operating in today's business environment. How these companies are operating are pushing the limits or have exceeded the limits of what is considered ethical and legal. In completing this project you will have the opportunity to research the two companies, identify stakeholders influenced by the organization's decisions and develop and evaluate alternatives, recommend solutions to ensure appropriate business practices and accountability occur

Outcomes met by completing this project:

1. identify ethical issues that arise in domestic and global business environments using an understanding of ethical concepts and of legal and business principles

2. develop and evaluate alternatives to, and recommend solutions for, ethical dilemmas, taking into account ethical and legal requirements and the essential mission of the business enterprise

3. effectively communicate to internal and external business stakeholders the complexities of ethical issues, suggesting and analyzing various solutions in order to ensure appropriate business practices and accountability

Instructions

Use the following steps to complete the project. You will demonstrate an understanding of ethical concepts and of legal business principles and are required to use the course material to support the ideas and conclusions presented.

Step 1: Course Material and Research

You are required to research the two companies to provide a company overview, to identify identify the issues and to identify stakeholders. You will be using the course to address the questions and support the ideas, reasoning and conclusions made. Course material use goes beyond defining terms but is used to explain the 'why and how' of a situation. Using one or two in-text citations from the course material and then relying on Internet source material will not earn many points on the project. A variety of source material is expected and what is presented must be relevant and applicable to the topic being discussed. Avoid merely making statements but close the loop of the discussion by explaining how something happens or why something happens, which focuses on importance and impact. In closing the loop, you will demonstrate the ability to think clearly and rationally showing an understanding of the logical connections between the ideas presented in a case scenario, the course material and the question(s) being asked.

Step 2: Silicon Valley Startup Companies

Read the following articles about Silicon Valley startup companies (Focus on Theranos and Zenefits ). Each company discussed in the articles listed below eventually came under scrutiny for ethical and/or legal issues.

Griffith, E. (2017, December 16). The other tech bubble. Wired. Retrieved from https://www.wired.com/story/the-other-tech-bubble/

Griffith, E. (2017, December 28). The ugly unethical underside of Silicon Valley. Fortune. Retrieved from http://fortune.com/silicon-valley-startups-fraud-venture-capital/

Hartmans, A. (2018, September 5). The rise and fall of Elizabeth Holmes, who started Theranos when she was 19 and became the world's youngest female billionaire before it all came crashing down. Business Insider Retrieved from https://www.businessinsider.com/theranos-founder-ceo-elizabeth-holmes-life-story-bio-2018-4

Suddath, C. and Newcomer, E. (2016, May 9). Zenefits was the perfect startup. Then it self-disrupted. Bloomberg. Retrieved from https://www.bloomberg.com/features/2016-zenefits/

Step 3: Overview of Companies

Provide a company overview for Zenefits and Theranos. Describe the purpose(s) for the founding of the company; i.e., what problems was it formed to solve and/or opportunities it was formed to exploit, who are the founders, home country or state, management, etc.

Step 4: Ethical or Legal Issues

You will research each company to establish the facts of each situation. Once you have established the facts surrounding the decisions made by Theranos and Zenefits:

  • Identify and discuss the ethical issues associated with each company.
  • Identify and discuss the legal issues associated with each company.

Step 5: Stakeholders

  • Identify the stakeholders associated with each company and explain the impact of the company’s decisions on the specific stakeholders.
  • Discuss how the stakeholders reacted to the decision(s) made by each company.

Step 6: Generate Alternatives

From what you have read, the startup culture poses a host of temptations creating a never-ending series of ethical choices and dilemmas. Companies are faced with the challenges of venture investors who expect hyper-growth and quick results. For privately-held companies, self-reporting, unaudited financials is an option as is not reporting, and the media serves to promote an attractive opportunity. Lastly, it is easy to rationalize behavior when the expectation is that entrepreneurs set the world on fire with innovative, disruptive technologies that promote overlooking rules and one’s moral compass.

Like many business people, some Silicon Valley decision makers need help in recognizing the ethical dilemmas they face when doing business and understanding the need for following rules and setting ethical standards. You will:

  • Generate and discuss at least three viable alternatives to help Silicon Valley startup companies operate and behave ethically. In doing so, it is necessary to consider the ethical and legal requirements.

Step 7: Evaluate Each Alternative

  • Examine the benefits and drawbacks of each proposed alternative. Provide careful consideration to the factors that influence the outcome of each alternative.

Step 8: Recommend the Best Alternative

  • Once you have evaluated each alternative, recommend the best alternative that ensure appropriate business practices and accountability.
  • Explain how Silicon Valley startup companies will effectively communicate this change to internal and external business stakeholders.

Step 9: Review the Paper

Read the paper to ensure all required elements are present. Use the grading rubric to ensure that you gain the most points possible for this assignment.

Proofread the paper for spelling and grammatical issues, and third person writing.

  • Read the paper aloud as a first measure;
  • Use the spell and grammar check in Word as a second measure;
  • Have someone who has excellent English skills proofread the paper;
  • Consider submitting the paper to the Effective Writing Center (EWC). The EWC will provide 4-6 areas that may need improvement.

Step 10: Submit the paper in the Assignment Folder (The assignment submitted to the Assignment Folder will be considered the student's final product and therefore ready for grading by the instructor. It is incumbent upon the student to verify the assignment is the correct submission. No exceptions will be considered by the instructor).

How to Set Up the Paper

Create a Word or Rich Text Format (RTF) document that is double-spaced, 12-point font. The final product will be between 6-8 pages in length excluding the title page and reference page. Write clearly and concisely.

Completing the Paper

In order to complete this project, you will want to first read the module, Learn How to Support What You Write, as this assignment requires you to use the course material and research to support what you write. Also,

  • Read and use the grading rubric while completing the exercise to ensure all requirements are met that will lead to the highest possible grade.
  • Contractions are not used in business writing, so do not use them.
  • Paraphrase and do not use direct quotation marks. Paraphrase means you do not use more than four consecutive words from a source document. Instead put a passage from a source document into your own words and attribute the passage to the source document. Not using direct quotation marks means that there should be no passages with quotation marks and instead the source material is paraphrased as stated above. Note that a reference within a reference list cannot exist without an associated in-text citation and vice versa. You may not use more than four consecutive words from a source document, as doing so would require direct quotation marks. Changing words from a passage does not exclude the passage from having quotation marks. If more than four consecutive words are used from source documents, this material will not be included in the grade and could lead to allegations of academic dishonesty.
  • You are expected to use the case scenarios and weekly course material to develop the analysis and support the reasoning. There should be a robust use of the course material and case scenario facts. Material used from a source document must be cited and referenced. A reference within a reference list cannot exist without an associated in-text citation and vice versa. Changing words from a passage does not exclude the passage from having quotation marks. If more than four consecutive words are used from source documents, this material will not be included in the grade and could lead to allegations of academic dishonesty.
  • Use in-text citations and provide a reference list that contains the reference associated with each in-text citation.
  • The only book you may use is the course eBook. You may not use a dictionary or Wikipedia.
  • Provide the page or paragraph number in every in-text citation presented. If the eBook does not have pages, provide the chapter title and topic heading.

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Explanation & Answer

Attached.

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Running head: ETHICAL ISSUE ANALYSIS

Ethical Issue Analysis
Name
Institution

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ETHICAL ISSUE ANALYSIS
Draft
Overview of companies
Zenefits is an American firm that provides cloud based software as a service to
organizations for managing their human resources, with a specific aim in aiding them cover their
health insurances. Founded in 2013, Zenefits owns and operates a modern human resources
management platform for both small and medium firms. It gives time off, attendance, benefits,
payroll as well as compliance solutions. The company’s investments majorly include private equity
funds, venture capital companies, investment firms, and accredited individual investors. Designed
as the single source of truth for managing the modern workforce, the company delivers the most
complete, all-mobile Human Resource experience by incorporating its own powerful applications
tightly with several other breed providers on the platform of the firm (Griffith, 2017). Many
companies use Zenefits to empower their workers, manage change as well as stay compliant.
Theranos was a privately held consumer healthcare technology firm, based in California
that provides blood tests. The company was initially believed to be an innovative technology firm
but has been eventually infamous for its false claims to have innovated blood tests that only
required small blood amounts. Founded in 2003, by the then 19 year-old Elizabeth Holmes, the
company raised more than 700 million US Dollars from private investors and venture capitalists
leading to a $10billion valuation at its peak in 2013 and 2014. This made the founder of the
company, Elizabeth, the youngest woman self-made billionaire at the moment. Elizabeth wanted
to change the medical industry by creating a new method of testing blood for medical diagnosis.

3

ETHICAL ISSUE ANALYSIS
It is now argued to be the biggest biomedical fraud in America (Griffith, 2017). Theranos’
founder, Elizabeth, was convicted of investor fraud after several articles revealed that the tests that
the firm claimed to be doing were not actually carried out by the company.
Ethical or legal issues
The two companies are part of a growing collective of highly valued startups, who have
come under enhancing scrutiny concerning their allegations, culture and failure to adhere to
significant rules in the sectors they work. They constitute a series of cutting corners, open
misrepresentation and a lifestyle of ‘fake it before you make it’ that attempts to undermine public
view of the tech industry as a whole (Griffith, 2017. This becomes even worse, when the fact that
the two companies deal with the health of people is considered. This is an area where delivering
exactly as promised is very significant.
Between 2012 and 2015, Zenefits moved from 20 workers to almost 500 workers and its
value in...


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