Edwin Black presents a book accusing IBM of having knowingly involved in business with the Third Reich. As a result of this co-operation the Nazis were able to identify Jews across Europe and speed up their extermination. IBM’s Hollerith technology was used to register and sort people.
After a description of their history, Black shows in detail how IBM was able to accumulate millions of dollars in profit even though the two countries were at war with each other.
The aim herein is to discuss IBM’s business ethics and CSR approach during the beginning of the century as well as their role in the community today. Different models and theories will be used in order to explore IBM’s reasoning for the continued business with the enemy and their new role in our time. As a first step, one needs to map the different influences any company is exposed to, placing IBM in a broader context.
Companies are communities of different people, separated into staff and management. It is the responsibility of management to lead the company and to ensure the wellbeing of the employees . Another responsibility is to generate profitable Return on Investments. Without such profits the company would not be able to exist for a longer period of time .
Table of Contents
Introduction
Part I – IBM during the time of the Third Reich
IBM – Who is it?
IBM – The Leader Thomas J. Watson
IBM – The Staff
IBM and other companies
IBM, the government and the public
Whistle blowing – was it possible in the 1930´s?
Part II – IBM today
Organisational learning and the connection between moral and law
IBM and Al Qaeda
From Ethics to CSR
Conclusion
Objectives and Topics
This paper explores the historical and contemporary ethical implications of IBM's corporate practices, specifically investigating the company's involvement with the Third Reich during World War II and its evolution toward modern Corporate Social Responsibility (CSR).
- IBM's business practices and management strategies during the 1930s and 1940s.
- The ethical egoism and decision-making processes of Thomas J. Watson.
- The feasibility and constraints of whistle-blowing during the Great Depression.
- The transformation of business ethics into modern CSR frameworks and corporate citizenship.
- The challenges of taking corporate responsibility for products in a globalized, multi-purpose technology market.
Excerpt from the Book
IBM – The Leader Thomas J. Watson
As stated above, the management has a huge impact on the behaviour of staff. Today there has been a separation between ownership and management of a company and managers are being controlled by e.g. supervisory boards. In former times managers were also the owners of the company and did not report to any outsider about their decisions. The main features of capitalism, opposed to public ownership, are private ownership, competition and profit.
Watson was a natural born sales person, selling was his calling. Truly addicted to the thrill of selling, IBM was his vehicle to gain satisfaction. He shaped IBM in a way that would support his goals. Even if rules needed to be bend or broken, Watson would do it in order to increase profits. Wars between nations were seen as business opportunities by him. Watson’s actions and attitudes can be classified as ethical egoism. Following his calling he acted in a way that maximised his own long term interests. His interest in others was surely just to pursue his own interests. In the midst of the war he made sure that his staff was receiving their salary, even if that meant that he had to break laws. Watson’s organisation can be understood as a regime where he ruled, however it would be based on mutually understood rules, both formal and informal. This mutual agreement made Watson one of the most respected managers of his time.
Summary of Chapters
Introduction: Outlines the accusations made by Edwin Black regarding IBM’s involvement with the Third Reich and sets the stage for discussing the company's historical and modern ethical conduct.
Part I – IBM during the time of the Third Reich: Analyzes the leadership of Thomas J. Watson, the economic context of the Great Depression, and the challenges of whistle-blowing during an era where corporate survival and legal compliance were paramount.
Part II – IBM today: Examines how IBM has transitioned towards CSR, the difficulty of monitoring technology misuse in the modern era, and the lessons learned from both historical failures and contemporary corporate scandals.
Conclusion: Summarizes that while IBM’s past actions under the Third Reich are unacceptable by modern standards, the company functioned within the prevailing legal and societal norms of its time, highlighting the necessity for external monitoring of corporate ethics.
Keywords
IBM, Corporate Social Responsibility, Business Ethics, Thomas J. Watson, Third Reich, Hollerith, Whistle Blowing, Great Depression, Ethical Egoism, Corporate Citizenship, Organizational Learning, Nazi Germany, Stakeholder Management.
Frequently Asked Questions
What is the core focus of this paper?
The paper examines the ethical history of IBM, particularly its business relations with Nazi Germany during World War II, and compares these findings with its modern approach to Corporate Social Responsibility.
What are the primary themes discussed?
The themes include the influence of leadership on corporate culture, the ethics of profit-maximization in conflict zones, the history of CSR, and the responsibility of companies regarding the misuse of their technology.
What is the main research objective?
The objective is to evaluate whether IBM can be classified as an ethical company by analyzing its historical actions in context and its transition toward current ethical standards.
Which methodology is employed?
The study utilizes theoretical models of business ethics and organizational learning, contrasting historical business practices with contemporary legal and societal expectations.
What does the main body cover?
It covers the specific business structures under Thomas J. Watson, the impact of the Great Depression on labor, the role of IBM technology in Holocaust-related activities, and modern case studies like Enron and Al Qaeda.
Which keywords characterize this work?
Key terms include IBM, CSR, Business Ethics, Thomas J. Watson, Nazi Germany, Hollerith, and Whistle-blowing.
How does the author justify IBM's actions during the war?
The author argues that IBM acted within the prevailing legal and economic structures of the time and emphasizes that other companies and government entities were also involved, suggesting a complex interplay of systemic issues.
Why is the comparison to Enron included?
Enron is cited to demonstrate that even in modern times, actions that are technically lawful can still be highly unethical, serving as a reminder that institutional monitoring is required regardless of an organization's reputation.
- Quote paper
- BA (Hons) International Management Stefan Pertz (Author), 2005, IBM - An ethical company?, Munich, GRIN Verlag, https://www.grin.com/document/36337
