Wednesday, March 5, 2008

Magically moral models that makes malpractice most maliscous

While presenting about Monsato's Hyperion planning system, business ethics came into the discussion. So that got me thinking about how to incorporate morality into a business model.

First, the assumptions:
  1. The word "morality" is defined as: The quality of being in accord with standards of right or good conduct. - American Heritage.
  2. Businesses should place morality at a higher priority than profit, regardless of how much profit or loss is cause by morality
  3. Assumptions one and two are absolute and are not allowed to be argued.

That said, practical applications of factors could be included into decision support systems. Environmental factors such as emissions or bi-products are completely quantitative and therefore can be monitored. Employment benefit packages and rewards systems can also be measured and recorded. There are many different qualities that can be added to a DSS and have ethical basis.

The question purposed earlier this evening about the poor, third-world farmer who loses his life's savings because of one bad season becomes much more complicated. I am still trying to figure out morality's role in this situation. Perhaps it is my version of the made up story...
  • Monsanto markets globally, even to third world countries
  • Poor farmer in third world country, cashes out all assets in order to purchase enhanced seeds to plant.
  • Monsanto quotes sale of however many bags of seed.
  • Farmer agrees and purchases.
  • Drought occurs and farmland is wasted by an "act of God."
  • Farmer loses everything.
  • Monsanto markets farmer again on the next season.
  • Farmer dies of starvation

This is how the story played out in my head. Monsanto's decision to market globally does not seem to be any more ethically wrong than a billboard advertising Limo service in rural Montana. A waste of resources may be a more accurate description.

The immoral decision occurred when the farmer decided to put all his eggs in one basket! Is it Monsanto's obligation to insure against acts of God? Agriculture is an extremely risky business, which is why we have farmers insurance.

Let's assume that Monsanto is guilty, think of how that would affect sales. "I'm sorry I can't sell to you. Well, uh your land has a bad record. You see there was a flood back in 1993 that basically wiped out your entire estate. Yes sir, I understand you own some of the most nutrient soil in the world, but when you combine the risk of another flood with the fragility of the market, I just can't sign off on this sale."

Now that seems more immoral than the alternative. It also sounds as if someone outside of the market is deciding the demand within it. To be perfectly idealistic and humanistic about it (of which I have the right, being 21) that is the most dangerous thing you can do to a market. Demand must be decided by the consumer, not any other entity.

But of course we must have our big government because people are not smart enough to make there own decisions....

Oh boy I can't wait for a response.

forever yours,

James

1 comment:

Vicki said...

First, I agree that the Monsanto situation is very complicated. The place where I have a problem is in the change of how farming works. Yes, there have always been Acts of God, but generally you got at least a little bit of the crop. Then, while you might not be able to sell it, at least you got some seeds for next year's crop. However, with this new Monsanto seed, you are not allowed to plant that seed ... you must buy new seed from Monsanto. So, it is defacto creating a dependence on Monsanto. I am not sure I think that is appropriate. But, mostly I wonder if all of that was explained to the farmer -- who may not be wordly in the ways of genetically engineered products. I just don't know. It feels uncomfortable, but .....

But, let's go back to your assumptions and think about how they might be the basis of a DSS. Let me emphasize that I do not disagree with them, but rather am trying to get you to think about how they might be tested in a DSS. First, "the quality of the product ...." ... WOW, this is hard to decide unless there are laws. What is "right" or "good conduct?" Clearly there is a lot of variation. Matel which has long been known as a producer of good toys "said" there should be no lead paint, but didn't test for it. Is closing your eyes to the possibilities that your subcontractor will do business differently ethical? How might a DSS be used to help in that decision? You might think about probability distributions of their responsiveness. And, you can look at the costs of testing relative to an expected value of "getting caught." Oh, doesn't that sound much less ethical than just ignoring the possibility of a problem?

Second there is the "place morality at a higher priority ..." Again, I agree with you, but does the average company? You might use a DSS to help companies see the benefits of such a policy. Going back to the lead paint, you might highlight those costs to the business of recalls, losing consumer confidence, etc. And, you could use the DSS to help them evaluate the relatively small costs of testing (and the relatively high chances of getting caught) to encourage appropriate behavior.

What might be interesting is to think of a DSS for a regulatory agency -- when should there be what kind of sanctions to encourage companies to act ethically?

Ethical issues are quite hard to include in a DSS. But, it certainly is worth thinking about.