1. STS have seven broad components: hardware, software, physical surroundings, people/groups/roles, procedures, laws, and data/data structures.
2. Socio-technical systems embody values
- These include moral values like safety, privacy, property, free speech, equity and access, and security. Non-moral values can also be realized in and through Socio Technical Systems such as efficiency, cost-effectiveness, control, sustainability, reliability, and stability.
- Moral values present in Socio Technical Systems can conflict with other embedded moral values; for example, privacy often conflicts with free speech. Non-moral values can conflict with moral values; developing a safe system requires time and money. And, non-moral values can conflict; reliability undermines efficiency and cost effectiveness. This leads to three problems that come from different value conflicts within Socio Technical Systems and between these systems and the technologies that are being integrated into them.
- Mismatches often arise between the values embedded in technologies and the Socio Technical Systems into which they are being integrated. As UNIX was integrated into the University of California Academic Computing STS (see Machado case at Computing Cases), the values of openness and transparency designed into UNIX clashed with the needs of students in the Academic Computing STS at UCI for privacy.
- Technologies being integrated into Socio Technical Systems can magnify, exaggerate, or exacerbate existing value mismatches in the STS. The use of P2P software combined with the ease of digital copying has magnified existing conflicts concerning music and picture copyrights.
- Integrating technologies into STSs produces both immediate and remote consequences and impacts.
Socio-technical systems change
- These changes are bought about, in part, by the value mismatches described above. At other times, they result from competing needs and interests brought forth by different stakeholders. For example, bicycle designs, the configuration of typewriter keys, and the design and uses of cellular phones have changed as different users have adapted these technologies to their special requirements.
- These changes also exhibit what sociologists call a "trajectory", that is, a path of development. Trajectories themselves are subject to normative analysis. For example, some STSs and the technologies integrated into them display a line of development where the STS and the integrated technology are changed and redesigned to support certain social interests. The informating capacities of computing systems, for example, provide information which can be used to improve a manufacturing processes can or to monitor workers for enhancing management power. (See Shoshanna Zubof, The Age of the Smart Machine
- Trajectories, thus, outline the development of STSs and technologies as these are influenced by internal and external social forces.
In this section, you will learn about this module's exercises. The required links above provide information on the frameworks used in each section. For example, the Socio-Technical System module provides background information on socio-technical analysis. The "Three Frameworks" module provides a further description of the ethics tests, their pitfalls, and the feasibility test. These exercises will provide step by step instructions on how to work through the decision points presented above.
For more information see Huff and Jawer below.
Decision Point One:
You are David Lord, a former employee of Holt Educational Outlet, a manufacturer of educational toys located in Waltham, Mass. Recently, you have joined with Stan Fung of Zero Stage Capital, a venture capital firm to buy out Holt Educational Outline. After changing its name to Toysmart, you and Fung plan to transform this brick and mortar manufacturer of educational toys into an online firm that will link customers to a vast catalogue of educational, high quality toys. Designing a website to draw in toy customers, linking to information on available toys, setting up a toy distribution and shipping system, and implementing features that allow for safe and secure online toy purchases will require considerable financing. But, riding the crest of the dot-com boom, you have two promising options. First, a venture capital firm has offered you $20,000,000 for website development, publicity, and other services. Second, Disney has offered the same amount for financing, but has added to it an additional $25,000,000 in advertising support. Disney has a formidable reputation in this market, a reputation which you can use to trampoline Toysmart into prominence in the growing market in educational toys. However, Disney also has a reputation of micro-managing its partners. Develop a plan for financing your new dot-com.
Things to consider in your decision-making:
- What are Toysmart values? What are Disney values? Would Disney respect Toysmart's values?
- What synergies could result from working with Disney? For example, could you share information on customers? You could feed your customer profiles to Disney in exchange for their customer profiles. What kind of data managing technology would be required for this? What ethical problems could arise from transferring customer identifying information to third parties?
- What kind of commitment would you be willing to make to Disney in terms of product and sales? How should Disney reciprocate? For example, how long should they stick with you through sales that fall short of projections?
Decision Point Two:
You work for Blackstone, "an 18-person software business." You have been asked by Toysmart to provide software the following functions: (1) designing a webpage that would attract customers and communicate Toysmart Values, (2) advise Toysmart on its privacy and data security policy including whether to register with an online trust, security measures to protect customer data during online transactions, and measures to prevent unauthorized access to customer data while stored, and (3) a comprehensive online catalogue that would provide customers with access to educational toys from a variety of small business manufacturers. An example of small toy manufacturers to which Toysmart should be linked is Brio Corporation which manufactures wooden toys such as blocks, trains, and trucks. Develop general recommendations for Toysmart around these three areas.
Information for this scenario comes from Laura Lorek, "When Toysmart Broke," http://www.zdnet.com/eweek/stories/general/0,1101,2612962,00.html. Accessed July 16, 2001.
Things to consider in your decision-making
- Toysmart is a fairly new dot-com. While it is supported by Disney, it is still a risky venture. Should you ask them for advance payment for whatever services you render? What kind of policies does your company have for identifying and assessing financial risk?
- What kind of privacy and data security policy should you recommend to Toysmart? What kind of values come into conflict when a company like Toysmart develops and implements privacy and data security measures? (Use your STS description to answer this question.)
- Should Toysmart become bankrupt, their data base would turn into a valuable asset. What recommendations should you make to help Toysmart plan around this possibility? What values come into conflict when planning to dispose of assets during bankruptcy proceedings? What kind of obligations does a company take on during its operation that continue even after it has become bankrupt?
- Using the link provided with this module, visit the TRUSTe website and find its white paper on developing a privacy policy. Evaluate this privacy policy for Toysmart. What benefits can a strong privacy policy bring to a dot-com? Should Toysmart work to qualify to display the TRUSTe seal on its website? Examine TRUSTe procedures for transferring confidential customer PII to third parties? What obligations will this create? Would this over-constrain Toysmart?
Decision Point Three:
You work for PAN Communications and have been providing advertising services for Toysmart. Now you find out that Toysmart has filed a Chapter 11 bankruptcy, and it has an outstanding debt to your company for $171,390. As a part of this fling procedure, Toysmart has reported its assets at $10,500,000 with debts of $29,000,000. Toysmart creditors, including PAN Communications, have petitioned the Office of the United States Trustee for a "Creditors' Committee Solicitation Form." This will allow for the formation of a committee composed of Toysmart creditors who decide on how the assets of the bankrupt firm will be distributed. You, because of your knowledge of bankruptcy and accounting procedures, have been asked to represent your company on this committee. This bleak situation is somewhat remedied by the customer data base that Toysmart compiled during its operation. It contains profiles of the PII (personal identifying information) of 260,000 individuals. Because selling educational toys is profitable, there is a good chance that this data base could be sold for up to $500 a profile to a third party. Should you recommend selling this data base? Should Toysmart customers be notified of the pending transfer of their PII and, if so, how should they be notified?
Here are some constraints that outline your decision
- As a member of the Creditors' Committee, you have a fiduciary duty to Toysmart creditors in work ing to distribute fairly the remaining Toysmart assets. This would, all things being equal, lead to recommending selling the Toysmart customer data base
- There are some provisions in the bankruptcy code that may require or allow overriding fiduciary duties given prior legal commitments made by Toysmart. These commitments, in the form of strong privacy guarantees made to customers by Toysmart on its webpage, may constitute an "executory contract." See the Legal Trail table in the Toysmart case narrative and also Larren M. Nashelsky, "On-Line Privacy Collides With Bankruptcy Creditors," New York Law Journal, New York Law Publishing Company, August 28, 2000.
- Finally, Nashelsky makes an interesting argument. While deontological considerations would require setting aside creditor interests and honoring Toysmart privacy promises, a justice-based argument would recommend a compromise. Bankruptcy proceedings start from the fact that harm (financial) has been done. Consequently, the important justice consideration is to distribute fairly the harms involved among the harmed parties. Harm distributions are correlated with benefit distributions. Because Toysmart customers benefited from Toysmart offerings, they should also bear a share of the harms produced when the company goes bankrupt. This requires that they allow the distribution of their PII under certain conditions.
Things to consider in your decision-making
- How do you balance your obligations to PAN with those to other Toysmart creditors as a member of the Creditors' Committee?
- How should you approach the conflict between honoring Toysmart promises and carrying out Creditor Committee fiduciary duties? Do you agree with Nashelsky's argument characterized above?
- Should the Bankruptcy Code be changed to reflect issues such as these? Should privacy promises be considered an "executory contract" that overrides the duty to fairly and exhaustively distribute a company's assets?
- Finally, what do you think about the FTC's recommendation? The Bankruptcy Court's response? The final accommodation between Toysmart and Buena Vista Toy Company?
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