BE Final Project - Group 4
BE Final Project - Group 4
BE Final Project - Group 4
Batch
PGPM 2023-25
Business Ethics
Term: II
Section: E
Submitted By – Group 4
MD Najam Sayeed – 2301349
Neeraj – 2301352
Shreeram RP – 2301372
Spoorthi V – 2301375
Tanmayee Khobragade - 2301384
December 2023
INTRODUCTION
Byju's, established in 2011 by Byju Raveendran, has achieved unmatched success in India's
fast-paced education technology sector, with a valuation of more than $18 billion. Known for
being the first to offer individualised online instruction for kindergarten through grade 12
students, Byju's has accomplished a lot. Still, it has also become mired in a series of moral
conundrums that threaten to overshadow its remarkable record.
The Online learning company's reputation has been damaged by claims of unethical
behaviour, which has prompted an analysis of the company's effects on workers, students,
and society's values. The business is charged with using pushy sales techniques to persuade
parents to enrol their kids in expensive courses by making false claims. There are concerns
about the human cost of Byju's success as reports of a toxic workplace surface, revealing
lengthy working hours, unattainable goals, and staff burnout.
In addition, there have been accusations of opacity, revenue overstatement, and dubious
acquisitions that have brought financial practices under investigation. Byju's is charged with
intensifying the digital gap by using a digital-only strategy and taking advantage of
vulnerable populations by focusing on low-income households. Discussions over the
appropriate use of sensitive information have been sparked by the massive gathering of
student data, which has also raised data privacy issues.
Byju's finds itself uncertain as calls for ethical reform gain traction. It must bridge gaps in
educational access, embrace transparent sales procedures, foster a positive work atmosphere,
guarantee ethical financial practices, and protect student data from misuse. These moral
issues must be resolved immediately, and immediate action must also be taken to spark a
good revolution that strengthens communities, gives students more authority, and makes
society more just overall. Byju's has the chance to become a leader of change in the field of
education by adopting ethical values.
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1. AGGRESSIVE SALES TACTICS
An initial call is made before the actual sales pitch starts, offering a "scholarship" for a multi-
year subscription to Byju's. Parents are given a chance to voice their concerns about the
Indian school system in a monologue that can span anywhere from two to three hours during
the counselling session. The BDAs uncover conceptual gaps in children by using a series of
deliberately tricky questions and discussions on subjects like fractions and chlorophyll, which
opens the door for multi-year memberships.
The Sales Tricks Arsenal: Personalisation, Assistance, and Rebates
Salespeople use a variety of strategies to persuade parents of the advantages of Byju's
subscription. A customised learning path, help from subject matter experts, committed
mentors, daily lesson plans, phone coaching, and an Android tablet filled with course
materials are just a few of the promises made. Furthermore, subscriptions that span multiple
years are packaged with alluring savings to persuade parents to commit a substantial sum of
money.
Sealing the Deal at Any Cost is the Sales Imperative.
Securing an immediate sale is the main objective of the sales process. Motivated by the
challenging sales goals established by Byju's, former BDAs stress that there is no other
choice. Salespeople are taught to evaluate potential clients' purchasing power based on a
variety of criteria and adjust their pitch accordingly.
Byju's introduced consumer loans, enabling parents to pay monthly instalments over multiple
years without incurring interest, facilitating multi-year subscriptions. Investigations, however,
show that parents who enrolled in these services frequently had no idea that they were doing
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it on credit. To preserve their good reputation, the BDAs refer to payments as EMIs or
equivalent monthly instalments instead of using phrases like "loan" or "outstanding
payments."
The Unsettling Truth: Parental Awareness and Grievances
54 out of 110 parents said they were unaware that they were taking out a loan to pay for their
membership, according to a thorough study of 110 complaints. With down payments ranging
from Rs 1,000 ($15) to Rs 60,000 ($864), the loans had an average ticket size of Rs 66,000
($952). The difficulties parents have when they discover they are legally obligated to a loan
agreement without their express approval are revealed by the complainants' interviews.
False Information and Concerns About Harassment
Several grievances point out Byju's lack of openness and communication breakdowns, which
irritate customers. Parents complain that, even after learning about the 15-day trial period,
they were not fully informed and were only told that cancellations could be made "anytime."
A further degree of confusion is added when the loan is not made clear during the sales pitch,
leading to an atmosphere where buyers feel misled.
According to some complainants, parents' pain is exacerbated when collection agencies
threaten them for not paying their dues. Incidents of harassment by lenders cast doubt on the
company's commitment to customer happiness and add to the bad customer experience.
Hasty Documentation and Behavioural Prods
After a three-hour sales pitch, the paperwork procedure at Byju's takes only five minutes,
which raises questions about how quickly signatures are obtained. Nudges and behavioural
economics are used to take advantage of people's diminished mental stamina following
extended interactions. This strategy could lead to clients forgetting important information,
especially when they sign electronic clearing service (ECS) documents with the name of the
third-party lender, which starts the EMI process.
Parents may not fully understand the consequences of the signatures they get during this
phase, as they rely on the sales agent's extensive pitch and expertise. These signatures are
frequently on ECS forms. The strategies employed in the sales process and the quick
documentation phase highlight a calculated effort to obtain commitments without giving
clients enough time for a critical assessment.
Restricted Access and Ignorant BDAs
When trying to cancel a subscription within the 15-day trial period, customers frequently run
into difficulties. Parents are reportedly unable to get a resolution since BDAs do not grant
cancellation requests. Customers find it nearly impossible to cancel because the trial period
has already passed by the time they get in touch.
The problem worsens when sales representatives cease answering calls or emails, putting
parents in danger. One worrying thing about Byju's customer service is that during the crucial
trial time, there was a lack of responsiveness and unfulfilled promises.
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In conclusion, Byju's pushy sales strategies and the concealment of important information
present moral questions about the exploitation of weaker families and the commodification of
education. The discussion of striking a balance between business interests and ethical
principles in the edtech sector is becoming more and more relevant as regulatory oversight
increases.
1.2 ANALYSIS OF THE ISSUE
Rights Perspective: Parents have the right to be fully informed and make decisions about
their children's education without manipulation. The lack of transparency, as well as the
potential exploitation of parents through undisclosed loans, violates their right to make
informed decisions.
Fairness Perspective: The sales strategy of targeting parents' concerns about their children's
academic performance and concealing the true nature of financial commitments is unfair. It
exploits the information disparity and emotional vulnerabilities of parents.
Integrity Perspective: Byju's employees, especially BDAs, may feel pressured to withhold
information, mislead parents, and ignore ethical concerns due to aggressive sales targets. This
compromise jeopardises the integrity of both the individuals involved and the organisation as
a whole.
Welfare Perspective: The sales practices may lead to financial stress for families who may
not have fully understood the financial commitments they were making. This poses a threat to
the welfare of families and potentially impacts children's education negatively.
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providing financial assistance programs or flexible payment options to ease the
financial burden on families.
By adopting these changes, Byju's can align its business practices with ethical principles,
rebuild trust with parents, and positively impact the welfare of families and children.
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alleged manipulative tactics extend beyond targeting low-income families. Former employees
claim that Byju's employs profiling techniques, collecting data on users' socioeconomic status
through its app. This data is then purportedly used to tailor sales pitches, with assumptions
made based on the type of mobile device a user owns – an iPhone, for instance, leading to the
assumption of belonging to a wealthier family.
The ethical concerns transcend sales tactics to encompass customer satisfaction and refund
policies. Numerous customer complaints highlight difficulties in obtaining refunds, with
claims of a complex process that disadvantages those less capable of navigating it.
Allegations of deliberate tactics to make it difficult for people to opt-out at the end of the 15-
day free trial taint Byju's reputation even further.
In the Byju's world, let's delve into some real stories that unveil the ethical issues tied to the
company's aggressive sales moves. Take the genuine account of a sales associate who
encountered a driver in a tight spot. This driver, provided with a phone by his employer,
grappled with financial strain yet enrolled his child in a Byju's course. The employer,
covering the down payment by deducting from the driver's meagre monthly salary,
exemplifies the alleged practice of pressuring those from low-income backgrounds into
buying Byju's courses, raising ethical concerns.
Then there's Miss Khemka's tale, giving us a peek into what Byju's employees deal with.
Though we don't have all the details, her getting fired suggests a rocky workplace where
folks might get mistreated or pressured into going along with the company's pushy sales vibe.
Her story pushes us to take a closer look at how Byju's runs things inside and how it affects
its workers.
And let's not forget Pratik Makhija, who showed us the not-so-friendly work vibe at Byju's.
He talks about facing mental stress every day, from harsh words to crazy, long work hours.
Seeking professional help for anxiety and then losing his job due to the stressful environment
shows how tough it can be. These examples – the driver's real struggles, Miss Khemka's job
loss, and Pratik Makhija's hard times – highlight the need for Byju's and other edtech big
shots to think hard about right and wrong. These stories are like warning signs, telling us to
seriously check how workplaces treat their people and the communities they serve.
Byju's response to these allegations has emphasised a "zero-tolerance policy" for
unprofessional behaviour and a commitment to course correction when needed. The company
asserts its dedication to customer respect and satisfaction, with claims of social initiatives
aimed at making quality education accessible to underserved communities.
However, the stories of employees facing abuse, pressure, and manipulation paint a stark
contrast to the company's public image. The accusations of toxic work culture and unethical
sales practices raise crucial questions about the broader issue of business ethics within the
edtech industry.
In conclusion, Byju's saga exposes a disconcerting reality – a company that has ridden the
waves of educational technology success at the expense of its workforce's mental well-being
and ethical standards. The accounts of former employees serve as a poignant reminder that
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behind the glossy facade of success, the moral fabric of a company shapes its true legacy. As
the edtech industry continues to burgeon, Byju's case prompts a critical examination of
companies' ethical responsibilities toward their employees and the communities they serve.
2.2 ANALYSIS OF THE ISSUE
Welfare Perspective: From a welfare perspective, the alleged toxic work culture at Byju's is
detrimental to the well-being of its employees. Prolonged working hours, abusive language,
and the pressure to meet unattainable targets have reportedly led to mental health issues
among staff members. Additionally, the aggressive sales tactics, especially targeting
vulnerable demographics, raise concerns about the well-being of the customers, particularly
those from low-income families who may face financial strain due to coercive selling
practices.
Duty Perspective: Byju’s, as an educational technology company, has a duty not only to its
shareholders but also to its employees and the broader community. The alleged mistreatment
of employees and unethical sales practices suggest a failure to fulfil these duties. It must
provide a fair and respectful workplace environment for its employees. Allegations of verbal
abuse, deceptive practices, and pressuring low-income individuals into purchasing products
suggest a breach of this duty.
Rights Perspective: The rights perspective emphasises the protection and respect of
individual rights. Employees have the right to a safe and non-abusive workplace, and
customers have the right to fair treatment, accurate information, and the freedom to make
informed decisions without coercion. The alleged abuse, high-pressure tactics, and profiling
of users compromise these rights.
Integrity Perspective: The contrast between Byju's public image, which stresses a "zero-
tolerance policy" and dedication to customer satisfaction, and the accusations of a toxic work
culture suggests a potential lack of integrity.
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3. Fostering a Healthy Work Environment: Establishing policies that promote a
healthy work-life balance, mental well-being, and a culture of respect within the
workplace is essential. This includes addressing concerns related to prolonged
working hours and abusive language.
4. Ethics Training: Implement mandatory ethics training for all employees,
emphasising the importance of fair business practices, respectful communication, and
the well-being of both employees and customers.
5. Cultural Shift: Foster a cultural shift within Byju's that prioritises ethical conduct,
employee welfare, and community well-being over aggressive sales targets. This may
involve revisiting performance metrics to ensure they are aligned with ethical
standards.
6. Transparent Communication: The company should communicate transparently
with both employees and customers, fostering a culture of honesty and integrity.
In summary, the recommended solution involves aligning Byju's practices with ethical
principles, prioritising the well-being of its stakeholders, and fulfilling its responsibilities to
the broader community. This approach not only addresses the issues highlighted by former
employees but also contributes to establishing a more ethical and sustainable business model
within the ed-tech industry.
3. FINANCIAL FRAUD
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amidst harsh foreign exchange guidelines. This incident raises serious ethical concerns about
capital allocation strategies and asks: Is Byju’s focused on long-term educational objectives
or short-term financial profits?
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Mounting Debt and Loan Defaults: There are huge debts that the company should bear while
it failed to make some of its loan repayments, which could lead to doubt about the
organisation's financial strength.
Erosion of Investor Confidence: These concerns have caused a dramatic decrease in the
valuation of Byju’s and its capacity to finance growth plans.
In addition to its woes, these other problems give an image of a firm reeling from
overwhelming financial challenges. What happens over time during this investigation will
decide Byju’s future.
3.2 ANALYSIS OF THE ISSUE
Welfare perspective: The welfare of investors, staff members, and students who depend on
Byju's services is jeopardised by faulty accounting, late financial reporting, and unreported
financial transactions. Byju's should put stakeholders' well-being first by taking urgent action
to address the delayed financial reporting, maintaining transparency, and supplying correct
and timely information to regain trust.
Duty Perspective: Byju's financial irregularities cast doubt on his fiduciary duties,
undermining confidence and maybe going against ethical norms. To fulfil its ethical
obligations, Byju's should rectify any wrongdoing, reveal financial information, and
restructure its governance procedures in order to honour its duty to shareholders, staff, and
students.
Rights Perspective: There has been a breach of stakeholders' rights to truthful financial
information, moral corporate governance, and reliable educational services. Byju's should
aggressively cooperate with investigations, fix governance issues, and ensure that all
stakeholders are informed and treated fairly to respect the rights of stakeholders.
Fairness Perspective: Potential financial fraud leads to unequal treatment that negatively
affects students, employees, and investors. To demonstrate its commitment to equity, Byju's
should resolve financial disparities as soon as possible, address governance concerns, and
ensure that stakeholders are fairly compensated for the investigation's findings.
3.3 ETHICALLY VIABLE SOLUTIONS
1. Quick Reaction to Postponed Financial Reporting: Byju's needs to take care of the
unfinished FY 2022 reports and deliver the audited financial reports for FY 2021 as
soon as possible. Rebuilding confidence requires openness. Thus, any delays should
be explained in detail, along with the reason(s) for the delay. This indicates a
dedication to transparency and responsibility.
2. Declare Fund Transfer Reasons and Verify Compliance: Byju's has to make sure
that the company's long-term educational goals are in line with the rationale for the
$533 million transfer to Xylo Capital. In compliance with foreign exchange
regulations, the business should also examine and validate the transaction's ethics and
legality. Clear information about this transfer will serve to allay fears and uphold
moral capital allocation procedures.
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3. Changes to Corporate Governance Procedures: Byju's needs to thoroughly
examine its corporate governance framework. This entails improving disclosure
procedures, selecting independent directors, and reevaluating board decisions. Byju's
should work with a respectable auditing company to resolve Deloitte's sudden
resignation, guaranteeing unbiased review and adherence to moral accounting
procedures.
4. Complete Participation in Government Investigations: Byju's needs to be
completely transparent and provide all required information to assist with the SFIO
and ED investigations fully. Addressing any possible infractions of the Foreign
Exchange Management Act is part of this (FEMA). A dedication to collaboration
indicates a readiness to address any misconduct, which helps to rebuild trust between
all parties involved.
In conclusion, Byju's is at a turning point where moral obligations necessitate prompt action.
For Byju's to regain credibility and maintain its beneficial influence on the education sector, it
must adhere to principles of transparency, accountability, and ethical business practices.
Byju's can only make their way through this moral minefield and ensure a viable and decent
future by adhering to these ideals.
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