Senior Security Co. offers a range of security services for senior citizens. Eac

Question

Senior Security Co. offers a range of security services for senior citizens. Each type of service is considered within a separate department and most of the cost except for corporate allocations are within each department's control. Mary Pincus, the overall manager, is compensated partly on the basis of departmental performance by staying within the quarterly cost budget. She often revises/reduces the operation's services to make sure departments stay within the budget. Says Pincus, "I will not go over budget even if it means slightly compromising the level and quality of service. These are minor compromises that don't significantly affect my clients, at least in the short term"

1) Is there an ethical concern in this situation?
2) If so, which parties are affected?

Explanation / Answer

1)

Yes there is an ethical concern regarding the decision of the manager to compromise quality of the service (though slightly) to stay within the budget. So far as the information is concerned, the prime objective of the manager for revising the budget and for putting an effort to stay within the budget is not for saving the cost of the company, but because of earning a better compensation which she receives if she can keep the cost within the budget.

However, even if the prime objective of the manager is to stay within the budget, by compromising quality of service, is for the company, then also a serious ethical issue is raised regarding the strategy of the manager. Slight compromising of quality, for a short run, may even be extremely detrimental for an industry which is engaged in providing the security service. Like many other products (for example medicines), the quality of the security services can never be compromised even for a short term and even slightly. Because a slight deterioration in quality of such service could be proved to be detrimental for the clients of the company and they could be exposed to severe financial loss as well as loss of human lives. Thus compromising quality even slightly and even for a very short term is ethically wrong on the part of the manager as well as the company.

2) The effected parties are:

a) The clients of the company as they could be exposed to severe damages financially

b) The company itself. As it will be utterly detrimental for the reputation for the company, even if nothing serious happens to the clients during the short run.

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