Instances of corporate fraud must be addressed immediately and effectively to prevent similar occurrences in the future and promote corporate values to employees across an organization. In the case under analysis, managing a problem of employee theft is required. Although the company admits that the total cost of the products stolen by their employee is rather small, the organization still views terminating its relationships with the staff member in question and dismissing him as necessary. However, the case in question might turn out to be not as easy to solve, as it might seem since it is not entirely ethically unambiguous.
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Approx is an IT company in Dubai that develops mobile applications. There are three major levels within its organizational structure, which include sales, R&D Department, and communication. Khaled, an employee who has been employed at Approxen for four years was caught stealing an IT company’s products that had a particular flaw in them. Even though the specified flaws were minor, such as problems in the design of the product or a quality issue that might lead to its relatively short shelf life, their presence indicated defectiveness of the goods. When conducting an audit of the company’s products, managers found out that Khaled had been stealing them. In his defense, the employee stated that he was not only appropriating the company’s goods but also preventing the instances in which customers would have returned for refunds or complaints.
Although it is apparent that the employee is trying to wiggle his way out of the punishment for his actions, the situation remains in a morally grey area. The employee has made a mistake and an administrative crime by stealing the products that belonged to the organization. However, a more detailed examination of the specified products has shown that they might have been deemed as defective and, thus, thrown away by the company anyway. Therefore, the situation remains complicated, and the actions of the staff member mentioned above cannot be seen as entirely wrong. To recover, the company will need to make the decision of forgiving the employee yet altering its entire philosophy and system of values to reduce the threat of similar occurrences in the future.
Because of the controversy surrounding the scenario described above, the IT company in question must be very careful when resolving the problem. Though accusing the staff member of theft will be relatively easy, he may state that the firm is also ethically flawed since it was selling defective items without checking them thoroughly. If reaching general audiences, the identified problem will give the company rather negative publicity and serve as the warning sign for several people who are currently seen as potential customers. On the other hand, turning a blind eye to the issue would mean that the organization condones corporate fraud, which must not be the case (Wells, 2017). Thus, a compromise may be required as the means of keeping corporate integrity and seek opportunities for improvements.
Particularly, the organization managers will have to start a dialogue with the staff member mentioned above. After opening a discussion and learning his motivation for stealing, the managers will have to figure out whether he feels remorse for what happened. In case the staff member genuinely regrets his actions and is willing to prove himself as worthwhile, it will be necessary to continue cooperation with him and give him a chance to change. At the same time, the company will have to seek opportunities for promoting quality improvement at all levels of its functioning to prevent similar situations from occurring (Comer, 2017). Particularly, it will be needed to ensure that appropriate corporate values are introduced to the corporate environment and instilled firmly.
The integration of strong corporate values is expected to have a positive impact on both the problem of corporate fraud and the emergence of defective products during the production process. Specifically, the company will focus on reinforcing the significance of corporate ethics and the necessity for staff members to improve their performance consistently. As a result, the technical aspects of production, including the identification of problems in product design and their management at the earliest stages, will be in focus. Furthermore, the active promotion of corporate values will become the platform for creating the setting in which the very idea of corporate fraud will become unacceptable.
Furthermore, the organization will have to revisit its approach toward meeting the needs of staff members. The act of stealing is a punishable offense, yet it is also necessary to recognize the factors that encourage staff members to steal (Orlitzky & Monga, 2017). For example, the company may seem as too greedy in its allocation of corporate resources, and employees may assume that, by taking some of its products secretly, they restore the balance of justice. In any case, the firm will need to provide its employees with benefits and required resources, as well as financial support and incentives (Cabric, 2015). As soon as the people working at the company realize that the organization values them as experts, they are unlikely to steal from it.
The problem of corporate fraud and, particularly, thefts is an admittedly unpleasant one, yet it can be addressed. Accusing the employee and fining him might seem the easiest way, yet it is unlikely to lead to any meaningful results. Instead, the organization may need to get to the core of the problem and understand what intentions the employee was guided when committing the theft. Thus, further cooperation and improvement on both the side of the employee and the one of the companies will be possible.
Cabric, M. (2015). Corporate security management: Challenges, risks, and strategies. Waltham, MA: Butterworth-Heinemann.
Comer, M. (2017). Corporate fraud (3rd ed.). New York, NY: Routledge.
Orlitzky, M., & Monga, M. (2017). Integrity in business and management: Cases and theory. New York, NY: Taylor & Francis.
Wells, J. T. (2017). Corporate fraud handbook: Prevention and detection (5th ed.). New York, NY: John Wiley & Sons.