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 ‫تجدید‬
‫ا‬#‫ کرن‬the company. They recommended Jim Stone as the new manager
because he had an impeccable reputation ‫ بے عیب‬for achieving results,
and top managers in the industry liked him because of his west Texas
demeanor ‫اؤ‬#‫برت‬. After eighteen months passed, 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
make snide , ‫اگ‬#‫ ا ورن‬comments 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 underperforming. 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
‫وجہ‬#‫ا ت‬#‫ز ک‬#‫مرک‬. 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.
QUESTIONS | EXERCISES

1. Describe the organizational culture at CrudeOil. How does it

contribute to the current situation?

2. How is CrudeOil violating its core value of treating others with

respect? What are some ways it could reincorporate this core value
into its organizational culture?

3. If Madison cannot report her problems to her immediate

supervisor, what are some other ways she can handle the situation?
Reference
BUSINESS ETHICS
Ethical Decision Making and Cases
TENTH EDITION

O. C. Ferrell
University of New Mexico
John Fraedrich
Southern Illinois University—Carbondale
Linda Ferrell
University of New Mexico
 • Thank You
• Best of Luck for the Learning Process