Sunday, April 5, 2015

Who was unethical - The customer or employee?

Below is a fictionalized case study that presents dilemma faced in real organizations. And written by me is the recommended solution to the problem. This has been published in Business Manager Magazine April 2015 edition.

Future Tense is a medium-sized electronic company located in a metropolis. It markets popular brands of home appliances like air conditioners, refrigerators, washing machines and microwave ovens, and undertakes post-sales maintenance. The policy of the company is to attend to the faults within 24 hours if the customer is within the city limits and within 36 hours if the customer is located outside the city limits. Obviously, the maintenance department is completely stretched and always works against stiff targets. Mr Anil Kumar is working as one of the executives in the post-sale maintenance department. He has twelve mechanics in his team. It is his responsibility to depute mechanics to attend to the complaints of the customers after they report for duty in the morning. 

The company has a  policy which indicates zero tolerance on unethical activities of the employees warranting dismissal from services. Company believes in doing business with transparency through ethical means.

The other day, Rahul, one of his most trusted and efficient employees, was assigned the duty to attend the complaint of one of the long-standing customers, Mr Suresh, whose air conditioner had developed a fault.  After attending and rectifying the complaint, rahul reported the complaint as satisfactorily closed and submitted the written report also. As a part of after service satisfaction check of customer, when  after service telemarketing employee called on suresh and verified about the airconditioner service, fault, time consumed, part replacement/repair, technician behavior etc, the customer told telemarketing employee that he was not all satisfied with the service, technician did not do much , taken money from him for replacement of one part, did not give him receipt . He also did not sign any satisfaction report. The A/c was still not functioning well. The customer also told that the technician requested him not to call office in case of  any trouble but instead call on his personal mobile number to do service and repairs. The technician gave his personal mobile no. to the customer.

At the end of the day, The after service telemarketing team employee opened the “concern form” of the customer and not all incident and submitted to Mr. Anil. On enquiry it was found the rahul was absent from duty.

When contacted on phone, Rahul informed Anil that the sudden illness and the subsequent hospitalization of his daughter was the reason for his inability  to take leave in advance and inform him about absence. He denied all allegations of the customer and said that satisfaction report was signed by him and it was he who requested him to purchase the part from open market and replace in AC  for which he gave money which he did. Rahul informed that Customer told him that earlier also other technicians did the same practice. Rahul pleaded that he did not do it with any wrong intention but only to earn the customer loyalty for company. He also explained that customer asked for his personal mobile no. in case of urgent call that’s why he gave his no.  . He also pleaded with Anil Kumar to help him out in this matter. However, the company has uncompromising policy that view dereliction of duty by employees for any reason as a major misconduct warranting immediate suspension. Adhering to the policy, Anil Kumar reported the matter to the higher authorities, who promptly suspended Rahul pending a full enquiry. The news of Rahul's suspension created widespread resentment among other technicians who sympathized with Rahul. But Anil Kumar justified his action by saying that any compromise on that ethical policy would have undermined not only the ability of his team to adhere to the after sales service policy and co. image set by the company but also the business profits itself.. He also felt that this kind of unethical behaviour would set a bad precedent, eventually bringing disrepute to the company. 

Questions for discussions and solutions:

1. How do you view the whole incident that resulted in the suspension of Rahul? 

Anil Kumar has strictly gone by the rules & policies of Future Tense Electronics Company. The Company believed in doing business with transparency through ethical means. Anil had applied the disciplinary measure when it needed to be applied. Once the customer’s complaint came on record and was brought to his notice by the after-sales representative and upon further internal inquiry by Anil, it was found that Rahul was absent from work, Anil had no choice but to suspend Rahul from duty pending a full inquiry.

Anil Lead by example. Research shows that Managers morality level determines the degree to which employees perceive the organization as ethical or unethical. For managers, the implication is clear: if you want your employees to act morally, start by acting morally yourself. This is particularly important for direct line managers which in this case was that of between Anil & Rahul.

Anil Kumar's actions are justified given the fact that any compromise on the ethical policy of the Company would have undermined not only the ability of his team to adhere to the after sales service policy and company image but also the business profits itself. Anil also felt that this kind of unethical behaviour would set a bad precedent eventually bringing disrepute to the company. Hence he had no option but to temporarily suspend Rahul from duty. 

2. If you were Anil Kumar, how would you deal with Rahul's lapse? 

Anil after coming to know of Rahul’s lapse should have looked at both the sides of the story, analyzed the same and then should have taken an well-informed decision. As Manager of Rahul, first thing is to trust him as a subordinate. Anil should have listened to Rahul’s side of story and determine whether he is telling the truth, is he being honest or are there any flaws in his version of the story? If Rahul claims that the customer has signed a satisfaction report, then Anil should have asked to see a copy of it and verified the claim of Rahul. 

Rahul claimed that his act was in best interests of the company and to retain a loyal customer. Hence this claim of Rahul should also be taken into consideration before taking any further action. If the act was indeed in company’s interests, then Rahul could be forgiven or let off but with a warning that the company will not tolerate such acts or report of incidences any more. This incidence should also act as a learning for other representatives as to what is to be done in such a scenario when dealing with such customers and what is the company’s stand vis a vis it.

Rahul was a trusted and efficient employee of the company as also was Mr. Suresh – a long standing customer of Future Tense Company. Anil could have had a dialogue with  Mr. Suresh also and cross-verified the claims of Rahul by counter-asking questions. It is not that the company does not trust it’s customers but this questioning was necessary since the act resulted in dereliction from duty of Rahul. It is also to be noted that as per the customer Mr. Suresh – it was a standard practice of all the mechanics to provide personal service to them in order to save on costs and earn some money for themselves. Mr. Suresh very well knew this and he encouraged this by saying that all earlier technicians also followed similar methods and so should Rahul.

This point is also to be investigated by Anil as to whether such malpractices really occur. Then the malaise runs deep, the problem lies in the system and the policies within the company and is just not with the case of Rahul who is just a cog in the wheel or rather the system. 

3. Do you see any lacuna in the ethical component of the rule that imposes suspension for dereliction of duty? 

A policy measure could have been in place that if an employee of the company is confronted with a situation that presents an ethical issue like in the case of Rahul dealing with the customer Mr. Suresh, he can seek guidance openly (open-door policy) from his superiors on how to handle it. 

Also it is not clear as to what is the policy of the company in terms of reporting breach of ethical behavior of others like how the customer Mr. Suresh that it is a standard practice that all earlier technicians also purchased parts from open market and gave their personal mobile number in case of further service requirements. Hence if this was happening quite regularly, why wasn’t it reported earlier or it did not come to notice. Did it come to notice only when the part supplied from the open market by Rahul turned out to be faulty and hence Mr. Suresh’s endeavor to save himself some money go waste and hence he turned in his frustration to Rahul and to the company. This aspect needs to be also looked into.

The company could provide to their mechanics company mobile phones and disallow usage of personal mobile phones during work or giving them to customers as a policy. Only company contact details including mobile numbers to be printed on visiting cards. By doing this, if an employee leaves the company, customer’s contact details remain with the company itself.

4. What is the policy measures required for the company to deal with such situations in the future?

Create a culture of caring: Create an altruistic culture. Although organizational culture cannot be created overnight, research has demonstrated that a caring culture prevents unethical work behaviors, whereas a culture of self-interest promotes them. What matters is persuading employees that the organization truly values generous, selfless behaviours.

Invest in business ethics training: Most companies can influence employees’ ethical choices via explicit educational programs. Businesses that implement formal programs to support ethical choices have reported decrease in counter productive behaviours and misconduct rates, as well as increase in employee satisfaction.

Reduce employee’s temptation: Managers can help employees who are less capable of exercising self-control by surveilling and controlling them a bit more.
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