Resolving ethical business challenges case study solution

Resolving Ethical Business Challenges

First, please read Chapter Five. Then, read the "Resolving Ethical Business Challenges" activity. Now, analyze the CrudeOil case utilizing the Cover Model. A complete analysis will include a clear analysis of each of the model's nine component parts (FIAS COVER) and a conclusion.

Resolving Ethical Business Challenges

CrudeOil, a subsidiary of a major energy multinational that manufactures oil drilling parts around the world, experienced a lag in sales. The board of directors brought in a new manager to revamp the company. They recommended Jim Stone as the new manager because he had an impeccable reputation for achieving results, and top managers in the industry liked him because of his west Texas demeanor. After 18 months, Jim was successful in increasing the company’s sales and profits. He began his tenure as manager by laying off several salespeople who had not performed according to his high standards. This made those who stayed with the company uneasy, and they responded in different ways. Some tried to get on Jim’s good side, while others focused on achieving their sales goals and avoiding any type of interaction with him.

The problem was Jim’s managing style was harsh and unpredictable. For example, when a mistake was made, he blamed salespeople he disliked even if it was not their fault. On one occasion, Marjorie, one of the newest salespeople, brought in an unusually big sale. Rather than giving her positive feedback, Jim acted like it was a normal occurrence. What was ironic was the company’s most important value was to treat everyone with respect. It was considered so significant it was printed on a banner and hung at the front of the office for all to see. When Jim lost his temper, it often happened while he stood in front of all the employees underneath the banner.

His personality really came out when he got angry. At several meetings he would randomly pick out salespeople and engage in intimidating behaviors such as staring at them for long periods of time, discounting their ideas, or simply ignoring them. Jim treated all of the employees with intimidating behavior, even the ones he claimed to like. Every so often Jim picked out an employee and made snide comments over the course of several days. He made no excuses about it.

One day, when one of the employees finally broached Jim about the matter, Jim announced to the entire office, “I pick out the employees who are under-performing. I am the boss, and I need to make sure you people make as many sales as possible.” He paused and looked at the expressions on the employees’ faces. He then continued, “Actually, you should make more sales than that!” Jim turned toward his office, laughing as he shut the door. The employee who spoke up was given the subsidiary’s lesser sales accounts.

Madison, who hired in as a salesperson a few months before Jim took control of the company, was continuously in Jim’s crosshairs. He told her even though she made her sales quota, it was not satisfactory. Furthermore, he took credit for her performance at meetings. When her numbers exceeded the quota, he spread rumors suggesting she wasn’t meeting her goals because of problems in her personal life.

One day Peter, another salesperson, approached Madison and asked her how she was doing. Madison looked at him confusedly and responded, “I’m as fine as anyone else here. Why?”

Peter answered, “Jim told me you had been in the hospital lately and you might be suffering from a serious illness.” Madison was taken aback. “Peter, Jim is just saying that because my sales numbers were low this last quarter. Believe me, I am fine.” Madison sat there infuriated that Jim would be spreading rumors about her.

Madison knew initiating a conversation with Jim would not be the way to resolve this issue. She felt she would be fired if she confronted him about his behavior or demoted like the other employee. She tried talking to others Jim had bullied, but many feared for their jobs and preferred to remain silent. She also considered speaking with the board of directors, but she did not know any one of them well and she knew they had a good relationship with Jim. Some kind of action had to take place because Madison could not work in an environment like that much longer. Besides, other employees’ tolerance would wear out soon and the company as a whole could suffer lasting consequences. As Madison walked toward the front door at the end of the day, she avoided looking at the banner featuring CrudeOil’s most important value.