SITUATION
Software piracy is a serious problem in Ukraine. While the latest version of Microsoft's Windows normally sells for more than $100 when purchased through a legitimate vendor, the same package can be picked up on the black market in Kiev for around $2, and it is usually bundled with additional software as a bonus! Brad, a project manager working in the Ukrainian office of an American consulting services fi rm, ponders the question of whether or not to buy 325 copies of pirated software through a local source for $1.85 per copy, versus purchasing these through an authorized vendor. The cost saving from this one decision would be nearly $32,000, and Brad knows that annual bonuses are tied to any cost savings.

To complicate matters further, Brad's office is up against strong rivals in the same market, and they usually purchase pirated software to control costs. The competition is so fierce and margins are so thin that Brad's company is thinking about pulling out of the market. Having to pay full price for legitimate software might be "the straw that breaks the camel's back"-that is, it might be all it takes to convince management in the United States to close the office down. The move to Ukraine was hard on Brad's wife and their twin daughters. After 14 months of settling in, they are finally getting comfortable with their new life in Kiev. Brad really doesn't want to move them again, at least not now. And furthermore, it is well known that social standards in Ukraine do not emphasize proprietary property rights anyway. Microsoft is so big that one lost order would hardly be noticed, and Microsoft won't even get the order if the company decides to close the Kiev office down.

Question 1 Is the project manager acting with integrity if he purchases unauthorized copies of the software on the black market?

Question 2 What might be the long-term effects of deciding to buy the pirated software? Of insisting on buying only legitimate copies of the software?

Question 3 What are the important questions to ask in a situation like this? Follow the ethical decision-making process outlined in the chapter. Does it work in this scenario?

Question 4 What course of action do you recommend? Why?