In a Harvard Business Review case study, CEO Siddhant Kapoor faced a complex ethical dilemma. He discovered that Uday Madhav, one of his top sales employees at Novacib Labs, falsified activity reports, claiming he met clients on days he did not. While the company prides itself on maintaining a zero-tolerance policy for dishonesty, Uday’s actions presented a challenge: should he be fired, or given a second chance due to his overall contributions?

Although Uday lied about specific client meetings, he did not act for financial gain and ultimately completed the work on other days. Terminating him would risk losing $250,000 in revenue and damaging relationships he had built with clients and coworkers. Instead, Siddhant could implement a solution that balances accountability with compassion:

• Issue a written warning and place Uday on probation.
• Require participation in ethical training sessions.
• Provide a clear path for Uday to demonstrate understanding and corrective action.

This approach reinforces the company’s values, protects performance, and cultivates a culture of accountability and growth. While some may argue that retaining Uday could undermine the zero-tolerance policy, zero tolerance does not mean zero compassion. By holding Uday accountable while supporting his development, the company strengthens both its ethical standards and team cohesion. A single mistake does not define an individual. By addressing errors constructively, organizations can transform challenges into opportunities for growth, fostering stronger leaders and a resilient workplace culture.

References:

Puri, S. (2019). Your star salesperson lied. Should he get a second chance?

Harvard Business Review, 97(5), 156–160.