Product Defects, “Moral Mazes”, and the Banality of Systemic Evil

Peter Ludlow wrote an opinion piece in the New York Times recently on The Banality of Systemic Evil.  The subject of the piece was recent “leaking, whistle-blowing and hacktivism that has vexed the United States military and the private government intelligence communities.”  Ludlow questioned the reason why mainstream and corporate commentators condemned such action but “independent” players were more supportive.

Now, the answers to those broad questions I will leave to Ludlow and others.

But in his piece, Ludlow discussed both “the banality of evil” and a book called “Moral Mazes” by Robert Jackall.  [Full disclosure: I haven’t read the book, just the descriptions in the article.]  The takeaway from both of these sources is that, while the individuals involved may not be “evil” or even have a personal “evil motive”, that such “evil” results when those same individuals play their given roles “inside the system”.

The mid-level managers that [Jackall] spoke with were not “evil” people in their everyday lives, but in the context of their jobs, they had a separate moral code altogether, what Jackall calls the “fundamental rules of corporate life”:

(1) You never go around your boss.  (2) You tell your boss what he wants to hear, even when your boss claims that he wants dissenting views.  (3) If your boss wants something dropped, you drop it.  (4) You are sensitive to your boss’s wishes so that you anticipate what he wants; you don’t force him, in other words, to act as a boss.  (5) Your job is not to report something that your boss does not want reported, but rather to cover it up.  You do your job and you keep your mouth shut.

Jackall went through case after case in which managers violated this code and were drummed out of a business (for example, for reporting wrongdoing in the cleanup at the Three Mile Island nuclear power plant).

– Peter Ludlow, The Banality of Systemic Evil

So how does this relate to legal issues and safety?  Simple really, this is precisely how product defects make their way into even thoroughly designed and vetted projects.  Systemic “group-think” and disregard of problems in favor of expedience, profit, or some other gain.

Take, for example, Johnson & Johnson’s recall (and expected litigation settlement) involving its DePuy ASR artificial hip systems.  There were problems with this medical product from the very beginning.  The problems were so bad, in fact, that the FDA refused to approve the ASR because of “significant” numbers of premature failures.  The company pressed forward regardless.  It sold the products in other countries until it found a regulatory loophole that allowed it to sell a companion version in the US.  Then it was forced to recall 93,000 devices the next year.  This year, the company will pay approximately $4 billion in settlements to victims who had their defective implant removed and replaced.

Or consider Ford Motor Company.  On March 5, 1991, Ford’s Chairman and CEO, Harold Poling, stressed to Ford’s high level Product Planning Committee that “it [was] unacceptable to plan for deteriorating car profit margins and accordingly it [was] critical to find ways to improve margins across the board.”  To do so, Ford would cut costs.  Chairman/CEO Poling indicated “it would be desirable to reduce cost related to items designed to achieve or exceed compliance with regulatory requirements to as low as possible.”  It doesn’t take much reading between the lines to see that Ford’s Chairman instructed his designers to cut costs on safety and to do only the minimum required.

Almost two decades earlier, Ford’s engineers had done a value analysis – The Grush-Saunby Report – to determine whether it was more cost effective to increase safety or to simply let people die.  GM performed a similar analysis -the Ed Ivey Memo – at about the same time.  Ivey prepared this two-page memo so managers could “…figure out how much Olds could spend on fuel-systems”. In it, he determined that it would cost approximately $8.59 per vehicle to protect the fuel system, but it would cost only $2.40 per vehicle to settle wrongful death lawsuits arising from fuel-system related deaths. General Motors could save $6.19 per vehicle by accepting the deaths rather than fixing the fuel system. Stated another way, General Motors could spend up to $2.40 to make the fuel system safer; anything more would not be cost effective because it was economically cheaper to let passengers burn to death in post collision fires.

The concept of a value analysis was explained succinctly – though graphically – in the movie Fight Club.

These are just a few examples.  Similar decisions are made in board rooms across the country each and every day.  CEOs, executives, managers – people – who would never place their family in danger at home are blinded by group-think and support by “yes men” who cast aside their personal moral code in favor of the “fundamentals of corporate life”… and put you and your family in danger.

© 2013 Brett A. Emison

Follow @BrettEmison on Twitter.