Muhammad Saad Rahman 19 March, 2012 Question 1 #1: Employees were abusing the policy of being allowed to eat

for free when working #2: Employee wages were low #3: Easy access to the unlocked storage room door #4: Inventory was poorly controlled #5: Weak supervision by the student managers #6: No written rules or strict guidelines #7: Inadequate training #8: Low wages as a justification for stealing #9: Inconsistent punishment mechanism Question 2 a. If Susan goes up and says something she has the possibility to get fired because after all it is the Student Managers who are running the show and very likely to take this for granted. On the other side she can continue to put up with unethical behavior and when she becomes the manager she can change things (but then she should have become the Manager by overlooking the very things she wants to have changed now) b. As per slide 4 in the class, ethical behaviour is driven by Family, Experiences and Peer Group. I believed that I had been brought up correctly and knew right from wrong [Ref: C-274]. This happened to be her strongest driver for her ethical behavior which was driven by her Family setup and upbringing. Question 3 Recommendation: Susan should approach the owners (not the managers) to present to them a case that by allowing such malpractices happen eventually the business would be impacted. She should further emphasize that they should pay more attention to the business and cut the bad practices which have become prevalent. Pros #1. She would have done her due diligence and would have a more satisfied conscience #2. She would have the recommendation to be Cons #1. Owners might just reference her that she has raised the issues and which might end up in isolating her from the rest of the team #2. She might have to let go of staff if promoted as

promoted as manager #3.

manager and have the additional challenge a whole new team #3.

Question 4 The assumptions I would make is that based on these malpractices the profit is going down. I would take the approach of what most retail stores do and that is to allow a certain percentage of Shrink. That being that for example 3% unaccounted for sales is acceptable. The bottom line is that the store should not be in loss. To go about executing it I will carry out the following steps: Step 1: Get the complete figures on the inventory Step 2: Cross check the inventory with the Sales Step 3: To control inventory issues I will assign one person on one shift to control inventory and hold that individual accountable for his/her actions Step 4: Proper training would be imparted to the Student Managers and staff and highlighting the implications involved (the company losing money and they losing jobs eventually) so that everyone is aware that the actions they do have far reaching impact. Step 5: After the training is completed and everyone is on the same page, I would on a daily basis have the inventory matched against Sales and failing the target of 3% will have repercussions for the Student Managers and Day Managers to be either replaced or even fired. Step 6: Hopefully this should solve the problem and we would not need to proceed further.