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In: Accounting

Dash Riprock is a cost analyst with Safe Insurance Company. Safe is applying standards to its...

Dash Riprock is a cost analyst with Safe Insurance Company. Safe is applying standards to its claims payment operations. Claims payment is a repetitive operation that could be evaluated with standards. Dash used time and motion studies to identify an ideal standard of 36 claims processed per hour. The Claims Processing Department manager, Henry Tudor, has rejected this standard and has argued that the standard should be 30 claims processed per hour. Henry and Dash were unable to agree, so they decided to discuss this matter openly at a joint meeting with the Vice President of Operations, who would arbitrate a final decision. Prior to the meeting, Dash wrote the following memo to the Vice President:

To:   Anne Boleyn, Vice President of Operations
From:   Dash Riprock
Re:   Standards in the Claims Processing Department
As you know, Henry and I are scheduled to meet with you to discuss our disagreement about the appropriate standards for the Claims Processing Department. I have conducted time and motion studies and have determined that the ideal standard is 36 claims processed per hour. Henry argues that 30 claims processed per hour would be more appropriate. I believe he is trying to “pad” the budget with some slack. I'm not sure what he is trying to get away with, but I believe a tight standard will drive efficiency up in his area. I hope you will agree when we meet with you next week.
  1. Discuss the ethical and professional issues in this situation.

Solutions

Expert Solution

It is fine way for make a discussion with vice president of operations regarding the difficulties in operation department or variations in standard figure. Dash have done a complete a scientific study and has figure in support. In contrast, henry has enormous practical involvement and can be more attuned to reality and on the job possibilities, taking both man and machines into consideration. The two of them deliberated and unsuccessful to reach a settlement over the standard number of claims per hour.

Having producing a likelihood, to resolve the issue with the higher authority or appropriate managers, it is certainly unprofessional, to attempt to voice personal views, in the absence of henry. This should be elevated in the occurrence of henry, so that he can give elucidations, as he considers fit. Leave alone the number- this in itself, is a breach of agreement as a part of dash.

Scientific study or methodology studies is the solely purpose of executing into practice to avoid variations in work. It certainly follows that a thorough investigation of what is already in practice, is very important for knowing what can be insisted and implemented. So. It goes, deprived of saying that a cost specialist and a claims processing manager has to work in unison with one another, to establish an expressive and realizable standard.

Business ethics of enlargement of prosperity by optimum consumption of possessions inclusive of men and machines. Trusting or giving on prominence to only calculated figures too rigidly, without philanthropic deliberations, means lack of ethics.


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