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Toward an Ethical Understanding of the Controversial Technology of Online Reverse Auctions

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Abstract

B2B online reverse auctions technology (ORAs) emerged as a popular tool for large buying firms in the late 1990s. However, its growing use has been accompanied by a corresponding increase in unethical behaviors to a point that it has been described as the technology that has triggered more ethical concerns in the e-commerce arena than in any other segment of activity. Our findings first indicate that the establishment of formal ethical criteria based on the restrictive interpretation of ethics as honesty is not enough to resolve the ethical issues that surround the introduction of a technology because it ignores the ethical values shared by most actors in the sector in terms of fairness. We show the extent to which lobbying, rumor, technical problems, and public discourse can impact on the interpretations of the technology regarding ethics. Highlighting the importance of incorporating ORAs into the broader context of relationship management that integrates ethics as fairness and not only ethics as honesty serves to illustrate why the future of ORAs might not be as bright as predicted by a theoretical interpretation of the technology that is sometimes disconnected from the realities of the field.

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Abbreviations

EMP:

Electronic Market Place is a virtual intermediary which offers buyers and suppliers technological tools to enhance their buying and supplying processes

ORA:

Online Reverse Auction is an e procurement system used by large buying companies, such as retailers, to enables its suppliers to compete in real time by decreasing their bids

IOS:

Inter-Organizational Information Systems are shared systems that cross the organizational boundaries and are used by two firms or more

TTC:

Total Time to Contract refers to the entire time buyers spend to conclude the negotiation process

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Acknowledgments

The authors acknowledge the valuable feedback received from Ellen O’Connor and Paul W. L. Vlaar on previous versions of this manuscript. The authors would also like to thank the Senior Editor Loren Falkenberg and the two anonymous reviewers for their pertinent comments and thoughtful suggestions throughout the review process that have greatly improved the quality of this article. The wonderful editing of Susan Leclercq is also acknowledged. Special thanks go to our key informant for her trust and continuous support.

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Authors and Affiliations

  1. EDHEC Business School, Roubaix, France

    Mohamed Hédi Charki

  2. University of Geneva, Ecole de Management de Normandie, Geneva, Switzerland

    Emmanuel Josserand

  3. ESDES Business School, Catholic University of Lyon, Lyon, France

    Nabila Boukef Charki

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  1. Mohamed Hédi Charki
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  2. Emmanuel Josserand
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  3. Nabila Boukef Charki
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Correspondence to Mohamed Hédi Charki.

Appendix

Appendix

Introduction: Dear Sir or Madam, We are conducting empirical research which deals with the way three groups of stakeholders interpret and assess e-procurement technologies. In accordance with our scientific research agreement, we confirm that our interview is strictly confidential and assure you that no details will be communicated to a third party. We thank you for your time and trust.

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Charki, M.H., Josserand, E. & Charki, N.B. Toward an Ethical Understanding of the Controversial Technology of Online Reverse Auctions. J Bus Ethics 98, 17–37 (2011). https://doi.org/10.1007/s10551-010-0532-z

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