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In addition to technical competence, work ethic, and communication skills, employers consistently indicate that they need people who are able to think critically. Critical thinking involves three primary aspects: identifying the problem and possible solutions, analyzing the problem using relevant information and models to develop and evaluate possible solution(s), and communicating the proposed solution clearly and in a way that addresses the pros and cons of the conclusion reached.

Many decisions in business organizations are complex and involve multiple options. While financial matters are important, business decisions involve more than simply following the option that creates the greatest profit in the short term. Longer term outcomes are important, and the impact of decisions for multiple stakeholders with whom the organization works matter greatly. As such, it is important for decision makers to understand the multiple facets of the problems that they face, to evaluate outcomes across different options, and to propose solutions that address the various facets of the problem from the perspective of organizational stakeholders. Once that has been developed, clear communication of the different aspects of the problem along with the proposed solution(s) is required.

You will put yourself in the position of a member of the leadership team to formulate your analysis and response. This problem is based on the problem above but must be completed with the information below.

North American Products Corporation is a large company that produces computer equipment. The company does the final assembly in the U.S. using component parts manufactured in company-operated factories across the world. Profitability is very important to the company, but the company also intends to operate ethically with respect to its customers, employees, and the environment. The companys approach to managing its locations is to appoint a senior management person to be responsible for all aspects of the operations of the location to which she/he is assigned. The senior managers are given authority for all decision making related to their location, and they are evaluated based on their results. If a manager achieves her/his targets and goals, they are given a bonus equal to three times their annual salary, but if they do not achieve their targets and goals, they are demoted or terminated.

The company has based their operating targets and goals on the managers ability to keep costs under budget and avoid fines or lawsuits related to product, employee, or environmental issues. However, North American has been the target of consumer complaints concerning labor and human rights violations and environmental pollution at some of their locations. While North American has not been sued or fined, the corporate leadership team is concerned that managers at some of its locations have not followed the companys code of conduct related to ethical workplace practices. North American conducted several employee focus group sessions at multiple locations and found out that the managers at the company locations are very aggressive and will do almost anything to make their numbers and avoid litigation so that they can earn their bonus. The focus group participants revealed instances where employees were forced to clock out but keep working to keep labor costs down, the use of harassment by factory managers to get more production out of factories, payment of bribes to local officials to overlook labor and environmental violations, and the use of substandard materials to reduce the cost of products manufactured.

As part of the corporate leadership team, you will join a task force to address this situation and provide recommendations for ways to correct the problems that the company is facing. Again, profitability and cost control are critical, but North American also wants to operate ethically with respect to its customers, employees, and the environment. The companys leadership understands that it is an important part of the community and that outcomes should contribute to the Common Good. They also understand that they have an opportunity and a responsibility to create meaningful work/jobs for their workers as well as to pay a living wage.

1. Identify the problem that the leadership team is trying to solve and the stakeholders who are affected by the approach to solve this problem. Be sure to address the challenges of controlling operations in a decentralized company structure and how a company can use metrics or KPIs to manage a large decentralized organization. The specific metrics that are chosen will affect managers decisions and guide their performance. Keep this concept in mind when setting performance expectations and metrics. Remember that stakeholders are not the same as stockholders stockholders are the owners of the company and represent one stakeholder group

2. . Identify and analyze the options that the company has to solve their problem. There are always multiple options, and the practice that the company is following at the present time may be the best option. Address the pros and cons of the options that you have identified. When you are identifying options, be sure to consider the material in chapter 23 about decentralized operations, the material in chapter 24 about the Balanced Scorecard, and the material that was covered in class and Discussions related to corporate responsibility reporting.

3. Write a conclusion to communicate your findings and recommendations. You will be recommending one solution in your conclusion. Explain your proposed solution and support your recommendation by explaining why it is the best approach.

CT23.5 American Products Corporation participates in a highly competitive industry. In order to meet this competition and achieve profit goals, the company has chosen the decentralized form of organization. Each manager of a decentralized investment center is measured on the basis of profit contribution, market penetration, and return on investment. Failure to meet the objectives established by corporate management for these measures has not been acceptable and usually has resulted in demotion or dismissal of an investment center manager. An anonymous survey of managers in the company revealed that the managers feel the pressure to compromise their personal ethical standards to achieve the corporate objectives. For example, at certain factory locations there was pressure to reduce quality control to a level which could not assure that all unsafe products would be rejected. Also, sales personnel were encouraged to use questionable sales tactics to obtain orders, including gifts and other incentives to purchasing agents. The chief executive officer is disturbed by the survey findings. In his opinion, such behavior cannot be condoned by the company. He concludes that the company should do something about this problem. CT23.5 American Products Corporation participates in a highly competitive industry. In order to meet this competition and achieve profit goals, the company has chosen the decentralized form of organization. Each manager of a decentralized investment center is measured on the basis of profit contribution, market penetration, and return on investment. Failure to meet the objectives established by corporate management for these measures has not been acceptable and usually has resulted in demotion or dismissal of an investment center manager. An anonymous survey of managers in the company revealed that the managers feel the pressure to compromise their personal ethical standards to achieve the corporate objectives. For example, at certain factory locations there was pressure to reduce quality control to a level which could not assure that all unsafe products would be rejected. Also, sales personnel were encouraged to use questionable sales tactics to obtain orders, including gifts and other incentives to purchasing agents. The chief executive officer is disturbed by the survey findings. In his opinion, such behavior cannot be condoned by the company. He concludes that the company should do something about this

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