Question

In: Accounting

Arnie Armstrong has been with Pierce Auto Parts Manufacturing Company for 23 years. Recently, he was...

Arnie Armstrong has been with Pierce Auto Parts Manufacturing Company for 23 years. Recently, he was appointed Director of Manufacturing Computer Services. In just six weeks in this new position, [he] has moved to reduce the amount of information provided to manufacturing department managers by 60 percent. He argues that excess data is distracting, unused, and expensive to provide. Willy McClean has been department manager for 12 years. During a coffee break with some of his department production supervisors, Willy is quite vocal about the change. “Who’s this guy Armstrong to tell us what data we need? He needs to be out here for a few weeks to find out what it’s like. Keep it quiet, but I’ve got a contact in Computer Services who’ll get me all the data analyses I want for just a $20 bill each month. It’s a good deal, and Armstrong will never know. How does he expect us to make good decisions about those variances without enough data? This guy in CS can get any of you data if you need it.” Kathy Cleary, overhearing Willy, is shocked. “Is that ethical, Willy? Do you really need that extra data? Can’t you get the information without going around Armstrong? I sure don’t want to pay for anything Mr. Armstrong doesn’t want me to have.” “Kathy, you've only been a supervisor six months,” Willy replies. “It’s just how the firm operates. Try it, and you'll see it’s worth the $20. You can't make good decisions with the stuff Armstrong gives us now.” Kathy doesn't respond, and the coffee break ends with people returning to their jobs. Later that evening Kathy begins to think about what Willy said. She knows that he is a good manager, but she does not want to have to buy information to do her job correctly. Tomorrow she is scheduled for a staff meeting with Mr. Armstrong. She is uncertain about what to do or say, if anything.

1. Share your thoughts on the situation

a) From Kathy's perspective

b) From Willy's perspective

2. Are any ethical lines being crossed? Why or Why not?

3. What do you think are the Practical Constraints?

a) Can the practice of buying information be curtailed or stopped?

b) Does the lack of information impede the function of managers under Mr. Armstrong?

4. What do you suggest and Why? (Remember to consider the implications of any actions)

Solutions

Expert Solution

1.

a) In the given situation, from Kathy's perspective, doing such an act is wrongful in any company. As a superior, they will be knowing all the inputs that are to be provided to the lower level people in the company for their works. If Armstrong has not to give any data, it would be surely out of any reason and Kathy is totally aware about it.

b) Willy on the other hand, for providing the best results from her end, wants to get the extra information by paying money to the other person in the office. If we look at this from her perspective, it might hold right because she is using it for the betterment of her work results, which would eventually result in the better results of the business as a whole.

2.

There is surely an ethical line crossed in the given scenario. First one is from Willy and the next is from the guy in CS who provides the information. In a company, if the superior employee decided some way of working for the entire team or the department, the subordinates are expected to follow it. These measures introduced by Armstrong was not to provide all the data as it was given preciously. Here, Armstrong wanted his subordinates to think a bit more and work more efficiently to obtain the same results which they would have received with those data given. It is in this situation that Willy is resorting to other measures to get the same information though different routes.

The CS guy is also doing an unethical job by disclosing the information that is not to be shared with the employees. In case the employee who gets the information uses it for any negative results for the company, it would indeed harm the company in future. So we can even say that such an employee is a threat to the company as a whole.

3.

a). The act of buying the information within the company can be curtailed efficiently by keeping strict controls on flow of such data within the firm. There must be proper monitoring done for these kinds of acts that are done in the company. The company must keep keen watch on those employees who deal with these types of sensible information that shouldn't be shared with anyone in the office.

b). The situation can't be said as a lack of information. Since Armstrong is a manager in the same industry since last 23 years, he must be well aware of the information that is to be shared and not shared with the team members. If certain information is very necessary to be shared, the managers need ot communicate about the same with him and in such a case, he would be forced to share such information with the managers. In the present scenario, I don't believe it would impede the decision making capacity of the managers.

4.

In my opinion, Kathy must communicate about the same with Armstrong in the meeting that is scheduled for next day. She must be a responsible employee and take the intiative to curtain these kinds of unethical acts within the company. Once Armstrong becomes aware of the situaiton, he need to evaluate the situation and a proper study must be done by him to confirm whether such an information sharing is necessary in the company. If if falls true that the information is to be shared with the managers for proper decision making, Aemstrong should correct his mistake and should start providing all necessary information from now on.

    


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