978-1285197159 Chapter 10 Define contingent work as a job situation in which an individual does not

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Chapter 10

Ethics of IT Organizations

At a Glance

Instructor’s Manual Table of Contents

Overview

Objectives

Teaching Tips

Quick Quizzes

Discussion Questions

Additional Projects

Additional Resources

Key Terms

Lecture Notes

Overview

Chapter 10 presents an overview of contingent workers and outsourcing. It describes the H-1B

visa application process and addresses the legal and ethical issues of the H-1B visa program and

offshore outsourcing. The second half of the chapter discusses whistle-blowers, including an

overview of laws that have provisions to protect whistle-blowers. The chapter concludes with a

discussion of green computing, its associated ethical issues and the ICT code of ethics.

Objectives

As student’s read this chapter, they should consider the following questions:

What are contingent workers, and how are they employed in the information technology

industry?

What key ethical issues are associated with the use of contingent workers, including H-1B

visa holders and offshore outsourcing companies?

What is whistle-blowing, and what ethical issues are associated with it?

What is an effective whistle-blowing process?

What measures are members of the electronics manufacturing industry taking to ensure the

Teaching Tips

Vignette—HP Finds Autonomy a Tough Pill to Swallow

1. Discuss the ways in which HP could have avoided this issue as well as increase

transparency in the system.

2. Note that due diligence is the investigation of all areas of an organization prior to agreeing

to a merger or other important transaction.

I. Key Ethical Issues for Organizations

1. Present the four ethical topics pertinent to organizations in the IT industry, and

organizations that make use of IT that include the use of nontraditional workers,

whistle-blowing, green computing, and electronics and information and communications

technology (ICT) code of ethics.

A. The Need for Nontraditional Workers

1. Point out that according to the Computing Research Association, the number of

undergraduate degrees awarded in computer science, computer engineering, and

information technology at doctoral-granting computer science departments in the United

States and Canada decreased dramatically from a peak of around 21,000 in 2004 to less

than 10,000 in 2009. Use Figure 10-1 to aid the discussion.

II. Contingent Workers

1. Define contingent work as a job situation in which an individual does not have an explicit

or implicit contract for long-term employment.

2. Explain that a firm is likely to use contingent IT workers if it experiences pronounced

A. Advantages of Using Contingent Workers

1. Point out that when a firm employs a contingent worker, it does not usually have to

provide benefits such as insurance, paid time off, and contributions to a retirement plan.

A company can easily adjust the number of contingent workers it uses to meet its

business needs, and can release contingent workers when they are no longer needed.

B. Disadvantages of Using Contingent Workers

C. Deciding When to Use Contingent Workers

1. Explain that when an organization decides to use contingent workers for a project, it

should recognize the trade-off it is making between completing a single project quickly

and cheaply versus developing people within its own organization.

2. Note that organizations should carefully consider whether or not to use contingent

workers when those workers are likely to learn corporate processes and strategies that

are key to the company’s success.

3. Although using contingent workers is often the most flexible and cost-effective way to

get a job done, their use can raise ethical and legal issues about the relationships among

Quick Quiz 1

1. _____ is a term applied to a variety of efforts directed toward the efficient design,

manufacture, operation, and disposal of IT-related products, including personal computers,

laptops, servers, printers, and printer supplies.

2. In _____, a business (called the subscribing firm) transfers all or part of its workforce to

another firm (called the leasing firm), which handles all human resource-related activities

and costs, such as payroll, training, and the administration of employee benefits.

3. _____ is an effort to attract public attention to a negligent, illegal, unethical, abusive, or

dangerous act by a company or some other organization.

4. (True or False) Employee leasing firms are subject to special regulations regarding workers’

compensation and unemployment insurance.

III. H-1B Workers

1. An H-1B visa is a temporary work visa granted by the U.S. Citizenship and Immigration

Services (USCIS) for people who work in specialty occupations—jobs that require at least

2. Point out that each year the U.S. Congress sets an annual cap on the number of H-1B visas

to be granted—although the number of visas issued often varies greatly from this cap.

Since 2004, the cap has been set at 65,000, with an additional 20,000 visas available for

foreign graduates of U.S. universities with advanced degrees.

Teaching

Tip

A frequent criticism of the H-1B worker program is that it takes technical jobs

from U.S. employees. Do you agree with this? What are the advantages and

disadvantages of the program to H-1B workers and to U.S. workers?

A. H-1B Application Process

1. Explain that most companies make ethical hiring decisions based on how well an

applicant fulfills the job qualifications. Such companies consider the need to obtain an

B. Using H-1B Workers Instead of U.S. Workers

1. Point out that heavy reliance on the use of H-1B workers can lessen the incentive for

U.S. companies to educate and develop their own workforces.

C. Potential Exploitation of H-1B Workers

1. Explain that even though companies applying for H-1B visas must offer a wage that is

at least 95 percent of the average salary for the occupation, some companies use H-1B

visas as a way to lower salaries.

IV. Outsourcing

1. Define outsourcing as a long-term business arrangement in which a company contracts for

services with an outside organization that has expertise in providing a specific function.

2. Note that in the 1970s, IT executives started the trend toward outsourcing as they began to

supplement their IT staff with contractors and consultants.

A. Offshore Outsourcing

1. Define offshore outsourcing as a form of outsourcing in which the services are

provided by an organization whose employees are in a foreign country.

2. Explain that as more businesses move their key processes offshore, U.S. IT service

providers are forced to lower prices. Many U.S. software firms set up development

centers in low-cost foreign countries where they have access to a large pool of

well-trained candidates.

B. Pros and Cons of Offshore Outsourcing

1. Note that the wages that an American worker might consider low represent an excellent

salary in many other parts of the world.

2. Explain that, for example, offshore demand is driving up salaries in India by roughly 15

percent per year. The cost advantage is shrinking, and once it reaches about 1.5:1, the

cost savings will no longer be much of an incentive for U.S. offshore outsourcing to

India.

C. Strategies for Successful Offshore Outsourcing

1. Walk through the five prerequisites for evaluating an outsourcing firm presented in the

list on page 384 and note that successful projects require day-to-day interaction between