Arvind Pandey Caught in Business Web

1 January 2017

Pandey is a project manager at AI Saba Construction Company in Muscat. It is a flourishing company with several construction projects in Muscat and a broad. It is known for completing projects on time and with high quantity construction. The company’s Chairman is a rich and highly educated Omani. A German engineer is Arvind’s Vice-President for urban and foreign construction projects. Three months ago, AI Saba had submitted a tender for a major construction project in Kuwait. Its quotation was for $25 million. In Kuwait the project was sponsored and announced by a USbased construction company called Fuma.

According to AI Saba, their bid of $25 million was modest but had included a high margin of profit. On 25 April, Arvind was asked to go to Kuwait to find out the Fuma project manager the status of their construction proposal. Arvind was delighted to know that Fuma had decided to give his company (AI Saba) the construction project work.

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The project meant a lot for AI Saba as they Is this essay helpful? Join OPPapers to read more and access more than 650,000 just like it! get better grades had already put in a lot of effort and money in planning the proposed construction in Kuwait.

But before Arvind could thank the Fuma project manager, he was told that bid should be raised to $28 million. Arvind was surprised. He tried to convince the Fuma project manager that his (Arvind) company had the best reputation for doing construction work in a cost effective way. However, he could always raise the bid by $3 million. But he wanted to know why he was required to do so. The Fuma manager’s reply was, “That’s the way we do our business in this part of the world. $1 million will go to our Managing Director in the US, I shall get $1 million, you, Mr.

Pandey, will get $1 million in a specified account in Swiss Bank. ” Arvind asked, “But why me? ” “So that you never talk about it to any one. ” The Fuma Project Manager said. Arvind promised never to leak it out to any one else. And he tried to bargain to raise the bid by $2 million. For, Arvind was familiar with… the practice of pay-off involved in any such things. Question:- 1. Analyse the reasons for Arvind Pandey’s dilemma. 2. Does Arvind Pandey really face a dilemma ? 3. In your view what should Arvind Pandey do ? Should he disclose it to his German vice president ?

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