Ethics in Business

When completing your Case Study Memo, you must do the following:

1. Explain all significant facts relevant to stating the most important ethical issue(s) in the case. Explain In particular all significant facts for suggesting and evaluating resolutions relevant to the case.
2. State the most important ethical issue raised by the facts of the case study.
3. Suggest three (3) alternative resolutions of the ethical issue(s). Make sure you consider the effects of each alternative on all company stakeholders. Explain why you think one of the alternatives is the best. You must fully and persuasively justify your choice.
Note #1: Although ethical issues may be related to marketing, management, employment issues, they are more than that. They concern the effects of business decisions on the well-being and rights of those touched by the decisions, including society at large.
Note# 2: When writing the case study, do not reproduce the language in the case study. Doing so will reduce your grade. Paraphrase everything you use from the case study. If you use any outside sources, properly attribute words or ideas taken from those sources.
It is useful to refer to and use outside sources to add to what you write in your paper. If you use any outside sources, properly attribute words or ideas taken from those sources by using in-text citations.

Case

Ted was getting pressure from his boss, parents, and wife about the marketing campaign for Full Effect Video, Inc.'s new video game called "“Body Count”". He had been working for Full Effect for about two years, and the “Body Count” game was his first big project. After Ted and his wife, Amy, had graduated from the same college, they decided to go back to their hometown of El Paso, Texas, near the Mexican border. Ted's father knew the president of Full Effect Video, which enabled Ted to get a job in its marketing department. Full Effect is a medium-size company with about 500 employees, making it one of the largest employers in El Paso. Full Effect develops, manufactures, and markets video arcade games.
Within the video arcade industry, competition is fierce. Games typically have a life cycle of only 18-24 months. One of the key strategies in the industry is providing unique, visually stimulating games by using color graphics technology, fast action, and participant interaction. The target markets for Full Effect's video products are children aged 5 to 12 and teenagers aged 13 to 19. Males constitute 75 percent of the market. When Ted first started with Full Effect, his task was to conduct market research on the types of games that players desired. His research showed that the market wanted more action (violence), quicker graphics, multiple levels of difficulty, and sound. Further research showed that certain tones and types of sound were more pleasing than others. As part of his research, Ted also observed people in video arcades, where he found that many became hypnotized by a game and would quickly put in quarters when told to do so. Research suggested that many target consumers exhibited the same symptoms as compulsive gamblers. Ted's research results were very well received by the company, which developed several new games using his information. The new games were instant hits with the market. In his continuing research, Ted had found that the consumer's level of intensity increased as the game's intensity level increased. Several reports later, Ted suggested that target consumers might be willing, at strategic periods in a video game, to insert multiple coins. For example, a player who wanted to move to a higher level of difficulty would have to insert two coins; to play the final level, three coins would have to be inserted. When the idea was tested, Ted found it did increase game productivity.
Ted had also noticed that video games that gave positive reinforcements to the consumer, such as audio cues, were played much more frequently than others. He reported his findings to Brad, Full Effect's president, who asked Ted to apply the information to the development of new games. Ted suggested having the machines give candy to the game players when they attained specific goals. For the teen market, the company modified the idea: The machines would give back coins at certain levels during the game. Players could then use the coins at strategic levels to play a "slot-type" chance opening of the next level. By inserting an element of chance, these games generated more coin input than output, and game productivity increased dramatically. These innovations were quite successful, giving Full Effect a larger share of the market and Ted a promotion to product manager.

Ted's newest assignment was the “Body Count” project, a fast-action scenario game in which the goal was to destroy the enemy before being destroyed. Ted expanded on the slot-type game for the older market, with two additions. First, the game employed virtual reality technology, which gives the player the sensation of actually being in the game. Second, keeping in mind that most of the teenage consumers were male, Ted incorporated a female character who, at each level, removed a piece of her clothing and taunted the player. A win at the highest level left her nude. Test market results suggested that the two additions increased profitability per game dramatically.
Several weeks later, Brad asked about the “Body Count” project. "I think we've got a .real problem, Brad," Ted told him. "Maybe the nudity is a bad idea. Some people will be really upset about it." Brad was very displeased with Ted's response.
Word spread quickly that the “Body Count” project had stalled. During dinner with his parents, Ted mentioned the project, and his dad said something that affected Ted. "You know, son, the “Body Count” project will bring in a great deal of revenue for Full Effect, and jobs are at stake. Some of your co-workers are upset with your stand on this project. I'm not telling you what to do, but there's more at stake here than just a video game." The next day Ted had a meeting with Brad about Lucky. "Well," Brad asked, "what have you decided?"
Ted answered, "I don't think we should go with the nudity idea." Brad answered, "You know, Ted, you're right. The U.S. market just isn't ready to see full nudity as well as graphic violence in arcades in their local malls. That's why I've contacted an Internet provider who will take our game and put it on the Internet as an adult product. I've also checked out the foreign markets and found that we can sell the machines to the Mexican market if we tone down the violence. The Taiwanese joint venture group has okayed the version we have now, but they would like you to develop something that is more graphic in both areas. You see, they already have similar versions of this type of game now, and their market is ready to go to the next level. I see the Internet market as secondary because we can't get the virtual reality equipment and software into an Internet mode. Maybe when we get faster, we'll be able to tap into it at that level, but not now. So, Ted, do you understand what you need to be doing on “Body Count”?"