Reference no: EM131874796

Question: Frank Hoffman is the CEO of Triple Plus, Inc., a group of four successful restaurants in the Southwest. One member of the Triple Plus board of directors, Sam Wasson, has a daughter, Chelsea Wasson, who has just started Chelsea's Cloths, a business that supplies restaurant linens. Wasson has approached Hoffman to explain Chelsea's business. Chelsea's Cloths has adopted an environmental emphasis in its operations as a way of countering the industry trend toward the use of paper products in restaurants. Sam Wasson initially recruited Hoffman as CEO, was instrumental in having the board select Hoffman, and is one of Hoffman's strong backers. Wasson supported Hoffman when other board members were impatient with his new procedures, policies, and changes.

Ordinarily, when someone approaches Frank Hoffman with information on a new supplier, he takes the information and refers it to the purchasing/supply area or refers the person directly to the manager of purchasing. In this case, Frank personally presented the information to Triple's purchasing manager, Deidre Hall. Frank offered Deidre the Chelsea's Cloths brochure and card and explained, "She is Sam Wasson's daughter. She just graduated in marketing from State University last June and now has her own firm. See what you can do. Our contract with Lila's Linens is up for renewal. Maybe we can do something."

Deidre evaluated Chelsea's and Lila's proposals as well as that of an additional firm in making the purchasing decision. Although the pricing between Chelsea's and Lila's is equivalent, Chelsea's is too young a firm to have a track record, and Deidre is not convinced that Chelsea's can handle Triple's large account. Given Mr. Hoffman's interest, however, Deidre is confused about what recommendation to make.

Required: a. Should Deidre recommend Chelsea's firm or offer her true recommendation?

b. Would it be ethical for Hoffman to change Deidre's decision?