A Manager's Ethical Dilemma - Essay Example

The rampant competition from these retail chains led to a whopping drop in revenue for the group, which resulted in a forty percent drop in revenues for the total group, whereas the retail and merchandising arm clocked around sixty percent fall in revenues (Swanton, 2005). This led to a lot of desperate steps by the Management, which included cutting costs at all points and also laying off employees. They also hinged on a plan to increase the profit at all levels. This would include cutting down on the redundancy at all the levels of management.

These were the major problems that were faced by the management. There were a lot of factors that were responsible for the unethical conduct on the part of the mechanics as well as the customer service officials. There was an immense pressure on them to fulfill the targets as well as increase the amount of revenue earned by each centre. The retail industry was taking a major hit and that effected the baseline of the company, The revenue loss from that particular division had to be compensated by earning extra revenue from other divisions there was large scale of cost cutting going on in the various sectors and the employees were being asked to leave.

; so, when a compensation policy that had the lure of incentive was set in, it resulted in the ensuing unethical behavior on the part of the employees (Gardiner, 2005). The backend mechanics were given steep targets and so were the front end customer representatives, who would monitor the situation. In addition to the extreme amount of work and target pressure, another factor that contributed to this kind of behavior was the tendency of the mechanics to go overboard and recommend more amount of repairs than usual.

The other problem would be the timing at which the particular vehicle would come. If it came during the part of the week that encountered slow sales, the mechanics and the front end people would oversell and try to maximize the output, which would ultimately create all the issues. This is a classic case of spillover effect, in which due to the fall in profitability of one arm, the other arm gets affected(Hursthouse,2001). Te other factor that can also be explained here is the cannibalization effect, where the loss from one arm would eat away into the profit from another arm.

The ethical approach used here was consequential. The reasons for this are manifold and are very clear. First of all, no proper study was done on the reasons as to why the fall in the retail segment was really happening despite the introduction of the non sears products. Secondly, the incentive plan was introduced without taking into the view the ground realities that existed. A situational analysis was necessary for the proper results and the outcomes to happen. They should have looked at the ground realities and introduced the changes.

Te current atmosphere was also not analyzed. The company was not doing well, the profits had plunged. It was all but natural for the people to resort to unfair tactics so as to boost the bottom-line. The employees were seeing other people around them being sacked and that would have increased the level of indulgence in the unfair urges to boost the profits and achieve targets by using unfair means. They only took the corrective steps after seeing the outcomes. Neither the duty aspects, nor the ethical aspects were studied