Utility, the Common Good, and the Sole Remaining Supplier

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The Case of the Sole Remaining Supplier presents a complicated ethical dilemma; its complexity is due to the many variables that it involves. These include the transistor company and the pacemaker company, their board members, investors and employees, the surgeons who install the pacemakers, and the patients. The board member’s decision will have resounding effects on these groups, and because of the company’s position in the manufacturing and technology sectors, it will also have an impact on aspects of the social structure. This being the case, the utility test and the common good test should play large roles in the board’s deliberation, and both of them will recommend that the transistor company stop doing business with the pacemaker company on the current terms of their agreement.

With respect to utilitarian ethics, this case must be decided by determining which course of action will serve to maximize good outcomes and minimize negative ones for every party. The correct utilitarian decision will be informed by calculating how much the groups stand to gain or lose from a given decision. Since, under utilitarianism, “an action is right if it creates the best overall outcome,” if a course of action that benefits each of these groups and minimizes or altogether avoids detriments can be found, then that is what ought to be done.

The transistor company must choose between two alternatives: persist in their arrangement with the pacemaker company on the same terms that they have been while considering a non-compete agreement, or decline to keep doing so.  If they continue to do business with the pacemaker company, it is likely that some of the pacemakers would lead to the death of more patients. Also, the transistor and pacemaker companies would be the danger of being sued. The doctors who install the devices would likely face a similar risk. On the other hand, the transistor and pacemaker companies would continue to profit, and many patients would benefit from correctly functioning pacemakers.

Conversely, if the transistor company declines to supply the pacemaker company with its product, the pacemaker company could go out of business, and patients would no longer have access to a life-sustaining technology. Further, the transistor company would lose business, and its revenue will decrease. However, by pursuing this option, the transistor company would preserve its reputation and resources and protect its investors from incurring a loss. This choice would also decrease malfunction-related deaths, and doctors would no longer be entrusting their patient’s lives to an unreliable product.

It seems clear that the correct utilitarian decision would be refusing to continue doing business with the pacemaker company under the present conditions. While this decision poses some significant problems for the parties involved, they all stand to gain in several ways. First, though the pacemaker company claims that if they are not supplied with transistors they will go out of business, one would expect the same if they were sued for creating a faulty product; their company would go bankrupt and people would not have access to their product. The same can be said for the transistor company. If they can be held liable for the faulty product, as one board member claims, then they will also go out of business and, thus, be unable to supply the pacemaker company and others with transistors. In other words, if the board decides to maintain business as usual with the pacemaker company, it is likely that one or both of the companies will be sued, resulting in a net loss for all parties involved. 

On the other hand, by refusing to keep their current arrangement with the pacemaker company, the board would protect itself, its employees, and its investors, thus enabling the company to continue supplying other businesses with its transistors. Furthermore, the board’s refusal to keep the same terms of their previous arrangement would encourage the pacemaker company to employ more rigorous testing for quality and safety; in the long run, this would benefit the pacemaker company, the surgeons, and the patients. At worst, this decision would result in protecting the transistor company and patients from faulty products and, at best, result in a net gain for each concerned party. Additionally, since this decision results in the maximization of utility and minimization of negative outcomes for everyone involved, it would provide a good example for businesses facing similar dilemmas in the future.  

While utilitarianism requires that one take the benefits and detriments of all parties involved into consideration when making an ethical decision, the common good test is much broader in its focus as it demands that one make a decision by considering the common welfare of humanity in general. This means that the right choice is that which preserves or promotes the common good, which includes “social systems, institutions, natural and technological environments, and ways of understanding that we all depend on to pursue our individual goods.” 

Clearly, the common good test is very relevant to the case at hand. Under this test, the board members would face the same dilemma: they can opt either to continue doing business with the pacemaker company on the same terms or not. However, they must now base their decision on the degree to which it will promote the common good. 

There are several ways that the decision to continue to supply the pacemaker company under the present terms would be detrimental to the common good. First of all, the faulty pacemakers could cause the general public to lose faith in the medical industry and the professionals to whom they trust their health and lives; this would foster anxiety and suspicion and cause patients to wonder whether or not their physicians really have their interest in mind. Furthermore, if the transistor or pacemaker companies are sued, this could tarnish the reputation of the manufacturing industry; if a product of life-saving importance is known to be faulty and nevertheless manufactured, sold, bought and installed, consumers will understandably assume that less attention is paid to products upon which nobody’s life depends. Finally, if the transistor and pacemaker companies are sued, then production and research of a beneficial new technology will be halted. This will result in a significant hindrance to the advancement of knowledge and technology - institutions that are essential to human progress and the common good.

However, these adverse effects may not follow if the board declines to continue doing business with the pacemaker company; on the contrary, this decision could benefit the common good in several ways. First, consumers and patients will maintain trust in the medial and manufacturing industries as there would be a decrease in the number of faulty pacemakers. Also, while advancement in knowledge and technology might come to a halt should the board withhold its product from the pacemaker company, this would also be expected if the pacemaker or transistor companies were sued into bankruptcy. This refusal would, however, raise the standards to which medical technology is held in the future.

Both the utility test and the common good test prescribe the same decision for the members of the board: they ought to refuse to do business with the pacemaker company on the present terms. While the common good test is more informative in that it provides one with more effects to consider than those having to do to with the parties directly involved in the decision, the idea of a “common good” is abstract and it is difficult to predict the effects that a given choice or action might have upon the social structures that constitute it. There are fewer variables to take into account under the utility test, and it seems easier to reliably predict how concrete entities, like a board of directors or a company, might be helped or harmed by an ethical choice than an ideal concept, like peace or functional government. 

As the Case of the Sole Remaining Supplier involves several different groups that will be influenced by the board’s decision, the utility test will provide the board with a valuable perspective on which decision will result in the greatest good for the greatest number of people. Similarly, as the decision will have an impact on the marketing, manufacturing, and technological structure of society, the common good test must also be applied. While both tests recommend that the transistor company decline to do business with the pacemaker company, the recommendation of the utility test is more informative and ought to be given more weight because the variables that it takes into consideration are more obvious and concrete, and this means that it is easier to predict what effects the board’s decision will have upon on them.