In December 1999, IBM-GSA was one of three tenderers for the IT outsourcing cont
ID: 420203 • Letter: I
Question
In December 1999, IBM-GSA was one of three tenderers for the IT outsourcing contract for the Departments of Health, Aged Care and the Health Insurance Commission (the Health Group), along with CSC and EDS. During the tender process, IBM-GSA was supplied with computer disks containing critical information relating to final pricing of their rival tenderers. IBM-GSA subsequently revised its tender after the due deadline and the minister announced they were the successful bidder. At the time, the Office of Asset Sales and Information Technology Outsourcing (OASITO) described giving IBM-GSA details of their rival’s bids as an ‘inadvertent error’. The minister dismissed the Opposition's call for an immediate halt to the tender process. Three years later, the minister, now retired, admitted that the $350 million tender should have been cancelled. He told the Audit Office in September 2002: “When the disc containing all three bids was delivered to IBM GSA in error my reaction on being informed directly by OASITO was to cancel the tender. I could not see that a tender process with integrity could continue. At the conclusion of the tender I was both disappointed and annoyed at the limited role of the Probity Auditor and the absence of a separate report on the issue.” Not only did the tender continue, with IBM-GSA being awarded the contract, but the minister's claim that the Probity Auditor’s role was limited was contradicted by evidence provided by OASITO to a Senate Estimates hearing on 8 February 2000. OASITO representatives told Senate Estimates that the management of the tender: “…was conducted in accordance with the advice from both the probity auditor and our legal advisers engaged for the initiative. All parties concurred at the time that the process could continue unchanged [OASITO] briefed the probity auditor in person [who] immediately came back to us with a proposed course of action…We engaged the probity auditor to participate in all of our discussions to make sure that he fully witnessed the nature of the discussions…and he was happy that we had delivered the messages in accordance with his proposed course of action.”
Your answer should include Q1. What's going on? Q2. What are the facts? Q3. What are the issues (non-ethical)? Q4. Who is affected? Q5. What are the ethical issues and implications? Q6. What can be done about it? Q7. What are the options? Q8. Which option is best - and why?
Clear explanation about how each of the four ethical theories can be applied to the scenario . When marking these questions students would be expected be able to utilise the four ethical theories to justify the moral action that will be taken. For each ethical theory, the student must A clear explanation as to how each of the four ethical theories can be applied to the scenario.
Explanation / Answer
1. The tender that was awarded to IBM GSA was awarded despite the fact that IBM recieved the quotes from the competition bidders as well. The OASITO had denied the role of the probity officer in examininga nd acting on the issue; and also the tender continued instead of being cancelled.
2. The facts are : IBM GSA, CSC and EDS are the three competitive bidder. IBM GSA recieved the competitions pricing and modified the quote to win the bid. The probity officer audited and the result was to cancel the tender process however the tender was awarded to IBM.
3. The sharing of the competitive pricing with IBM GSA.
Continuing with the tender process and allowing IBM to use the adjusted/ modified pricing.
4. IBM, CSC and EDS all were impacted positively and negatively respectively. The stakeholder, the health group was impcated and the ministery which involved probity officer etc were all impcated.