The implication of ethics in project management

Created by Vinay Kumar Meena

Abstract

Project management is an important discipline that plays a crucial role in the success of organizations. However, ethical considerations are often overlooked in the pursuit of achieving project objectives. This abstract explores the concept of ethics in project management and provides an overview of the ethical practices that are currently going on in the industry. The Project Management Institute (PMI) emphasizes the importance of ethical conduct in project management and provides guidelines for ethical behavior. The PMI Code of Ethics and Professional Conduct outlines four key values that should be upheld by project managers: responsibility, respect, fairness, and honesty. The code also provides specific guidance on issues such as conflicts of interest, confidentiality, and stakeholder engagement. Despite these guidelines, ethical dilemmas are common in project management. For example, project managers may face pressure to cut corners or meet unrealistic deadlines, which can lead to ethical compromises. Other ethical dilemmas may arise when dealing with stakeholders who have conflicting interests or when making decisions that have potential negative impacts on the environment or society. To address these challenges, project managers must be equipped with the necessary knowledge and skills to identify and address ethical issues. This may involve creating a culture of ethics within the project team, engaging in ongoing ethical training, and seeking out guidance from relevant experts. This article will provide a holistic view of ethics in Project management, common ethical dilemmas in project management (proposed by PMI), and a decision-making framework to overcome these dilemmas.

Introduction

Ethics is not a newly developed concept, it has evolved over time. Ethics guides us in the way of “how to do it best.” (PMI Code of Ethics).

What is ethics

Some definitions of ethics to understand the essence of the word 'Ethics'.

“Ethics refers to a systematic study of the norms and values that guide how humans should live their lives.”- by Joseph Desjardins(1)

“Ethics is the activity of understanding moral values, resolving moral issues, and justifying moral judgments. It is also the discipline or area of study resulting from the activity.”- by Roland Schinzinger and Mike W. Martin (2)

“Ethics is a branch of philosophy dealing with values that related to the nature of human conduct and values associated with that conduct.”-by David P. Twoney and Marianne M. Jennings (3)

Ethical Values

Ethical values (Fig 1) are sets of standards that could ensure that decisions have taken with high standards. Project management involves decisions, some are small and seldom noticed, and others stand out. These decisions involve people, resources, and the environment. Additionally, there are times when these elements can create conflicts, posing difficulties and even potential risks in the project. Ethical values are vital to learning professionalism and facilitating the process of management and development in project management.

Ethics in project management

Ethics in project management refers to the moral principles and standards that guide the behavior and decision-making of project managers and their teams. Ethics plays an important role in project management because it ensures that the project is executed in an honest, transparent, and responsible manner that upholds the values of society, customers, and stakeholders.

Key factors affecting any project

The project's notion of ethics can be impacted by a variety of factors. Humans are impacted by circumstances that cross over into the work and non-work environments, which may alter how ethics are perceived and defined. In his book Ethics and Project Management, Ralph L. Kliem, categorized these factors into nine categories. (4)

a) Peers: Peer pressure often comes either from the formal group or informal group of people, who has any relationship with the ongoing project.

b) Culture: project managers and team members must understand the cultural differences within their teams and organizations, communicate effectively, create an environment that values ethical behavior, and help to deal with ethical dilemmas.

c) Power: Lord Action “Absolute power corrupts absolutely.” This factor has a strong influence on the means and outcomes of the project.

d) Competition: When competition is improperly handled, projects may experience dysfunctional decision-making and behavior.

e) Reward: Decision-making and ethical behavior are significantly influenced by positive and negative rewards. The team's propensity to adhere to excellent ethical behaviors will grow if the project manager rewards good ethical behavior.

f) Experience: Experience performing an ethical transgression can be quite valuable, especially if it went undetected or was encouraged and involved no punishment.

g) Role expectations: Everyone has a role in a project. Each role is accompanied by expectations that may be set by other stakeholders or organizations. . Despite their origins, expectations can have a significant impact on what a person should or should not do.

h) Structure: Since hierarchy will always exist in organizational management, it is crucial to include ethics in these structures by allowing for the evaluation of actions.

i) Management style:

Key ethical values in project management

ethical values are essential to the success of any project. By upholding ethical values, project managers can build trust, maintain positive relationships with stakeholders, and achieve project goals in a responsible and sustainable way. Here are some of the key ethical values in project management:

a) Honesty and transparency: Project managers should be truthful and open about project status, risks, and challenges. They should not deceive or mislead stakeholders in any way.

b) Respect for stakeholders: Project managers should respect the needs and interests of stakeholders, including customers, employees, vendors, and the community. They should avoid conflicts of interest and ensure that all stakeholders are treated fairly.

c) Confidentiality: Project managers should protect sensitive information and not disclose it to unauthorized parties. They should also ensure that all team members understand the importance of confidentiality.

d) Compliance with laws and regulations: Project managers should ensure that the project complies with all applicable laws, regulations, and industry standards. They should also avoid engaging in any illegal or unethical activities.

e) Responsibility and accountability: Project managers should take responsibility for the project's outcomes and be accountable for their actions. They should also ensure that team members are accountable for their work and behavior.

f) Social responsibility: Project managers should be aware of the impact that the project may have on the environment and society. They should take steps to minimize negative impacts and maximize positive ones.

g) Professionalism: Project managers should always behave in a professional manner. They should demonstrate competence, respect, and integrity in their interactions with team members and stakeholders.

Importance of ethics in project management

Ethics is an important aspect of project management as it lays down the foundation for good governance and helps to build trust among stakeholders. Also, it is crucial for ensuring that projects are conducted professionally, sustainably, and in the best interests of all stakeholders. Ethical practices help to build trust and confidence, mitigate risks, and uphold social responsibility. Below are some of the key reasons why ethics are important in project management:

a) Upholding Professional Standards: Project managers are expected to uphold the highest standards of professionalism while delivering a project. This means conducting oneself ethically and adhering to ethical codes of conduct set by professional bodies.

b) Stakeholder Confidence: Ethical practices help to build trust and confidence among stakeholders, including project sponsors, team members, customers, and end-users. A project manager who conducts themselves ethically is more likely to be trusted and respected, which can lead to greater project success.

c) Risk Management: Unethical behavior can expose a project to a range of risks, including legal action, financial loss, and reputational damage. By adhering to ethical principles, project managers can minimize the risk of these negative outcomes.

d) Sustainable Outcomes: Ethics also help to ensure that project outcomes are sustainable and that they benefit all stakeholders, including those who may be affected by the project but are not direct beneficiaries.

e) Corporate Social Responsibility: Ethical behavior in project management helps organizations to fulfill their social responsibility by ensuring that projects are undertaken with consideration for their impact on the environment and society.

Ethical dilemmas in project management

Ethical Dilemmas in project management can be complex and challenging. It can arise when project managers are faced with difficult choices that challenge their moral principles and values. Project managers must be aware of these dilemmas and make ethical decisions that prioritize the interests of stakeholders, maintain the integrity of the project, and uphold moral principles and values. Here are some major ethical dilemmas that project managers may encounter (7):

a) Conflicts of interest: Project managers may face situations where their personal interests or relationships conflict with the interests of the project or stakeholders. For example, a project manager may have a financial interest in a vendor or supplier that they select for the project, creating a conflict of interest.

b) Stakeholder interests: Project managers must balance the interests of various stakeholders, including customers, team members, and shareholders. This can be difficult when stakeholders have competing interests, making it challenging to satisfy everyone.

c) Resource allocation: Project managers may need to make decisions about how to allocate limited resources, such as time, money, and personnel. This can be challenging when resources are scarce or when stakeholders have conflicting demands.

d) Ethical sourcing: Project managers must ensure that all vendors and suppliers they work with are ethically and socially responsible. This can be challenging when suppliers are located in countries with weak labour laws or have a history of unethical practices.

e) Project scope: Project managers may face pressure to deliver projects on time and within budget, which can lead to scope creep or cutting corners. This can compromise the quality of the project and lead to ethical issues.

f) Communication: Project managers must communicate effectively with stakeholders, team members, and customers. This can be challenging when communication is ambiguous or when information is withheld, leading to mistrust and ethical concerns.

g) Confidentiality: Project managers must protect confidential information, such as trade secrets and personal data. This can be challenging when stakeholders request access to sensitive information or when team members share information without authorization.

Consequence of ethical Failure

a) Tarnished reputation b) Tarnished credibility c) Hindered careers d) Legal consequences

Case studies

The Volkswagen Emissions Scandal: In 2015, Volkswagen was caught cheating on emissions tests in their diesel vehicles. The scandal involved the use of illegal software that could detect when the car was being tested under laboratory condition and reduce emissions to meet legal standards but would produce higher emissions in normal driving conditions. This case highlights the importance of ethical behaviour in decision-making and the potential consequences of unethical practices. (8)

The Deepwater Horizon Oil Spill: In 2010, an explosion on the Deepwater Horizon oil rig in the Gulf of Mexico resulted in the largest oil spill in U.S. history. The disaster highlighted the importance of safety and environmental responsibility in project management, and the need for effective risk management and contingency planning. (9)

The Flint Water Crisis: In 2014, the city of Flint, Michigan switched its water supply to save money, resulting in lead contamination in the drinking water. The crisis highlights the importance of ethical decision-making in project management, particularly when dealing with public health and safety issues. (10)

The Rana Plaza Factory Collapse: In 2013, a garment factory in Bangladesh collapsed, killing over 1,100 people. The tragedy highlighted the need for ethical supply chain management and the responsibility of companies to ensure safe working conditions and fair labour practices. (11)

The Theranos Scandal: In 2018, the blood testing company Theranos was exposed as a fraud, with its technology and test results being found to be inaccurate and unreliable. The case highlights the importance of ethical behaviour in innovation and the potential consequences of cutting corners in research and development. (12)

Each of these case studies demonstrates the importance of ethical decision-making in project management and the potential consequences of unethical practices. They provide valuable lessons for project managers in various industries to ensure that they are making ethical decisions and taking responsibility for their actions.

Ethical decision-making famework

Common approach to deal with ethical dilemma

A project manager's sensitivity to ethical issues and a precise approach for examining the ethical aspects are necessary for making morally sound decisions. Having a method of making ethical decisions is crucial in the age of globalization, where cultures, values, and beliefs are perpetually clashing. The framework should direct our analysis of the issue, inspire us to seek new information and viewpoints, and assist us in reaching morally sound decisions. Regular use of the framework results in habit formation, which promotes moral behaviour and moral leadership. (6)

The framework for ethical decision-making should broadly follow the steps outlined below: a. Identify the Ethical Issue

b. Analyse the facts

c. Evaluate Alternative Options

d. Make a Decision

e. Implementation

f. Reflect on the Outcome

While making decisions, the decision-making hierarchy and the code of ethics (fig 3)(6) which can help guide individuals and organizations through the complex process of making ethical decisions by providing a step-by-step process that can be used to evaluate and weigh different ethical considerations. This hierarchy can help ensure that important ethical factors are considered and evaluated and that the decision-making process is transparent and consistent. (Hierarchy of moral leadership in ethical decision making)