charles benson

8/12/2019 Charles Benson

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THE CHARLES BENSON PROBLEM

Charles Benson is a superior engineer who hasbeen employed as a design engineer with your companyfor the last seven years. Benson,who is now 35 years old,is a reliable employee as well as a skillful and inventive

engineer. Seeking to earn additional money, he decided tostart his own business, at which he would on eveningsand weekends. The products to be made and sold as partof this business are similar to those made and sold byyour company. Bensons immediate supervisor found out

about Bensons business but took no action for severalmonths, believing that the business probably would notamount to much and that eventually Benson would loseinterest in the project and drop it on his own.


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However , one afternoon the supervisor foundBenson on company time using a company telephone toorder materials for his business. The supervisorreprimanded Benson on the spot and warned him thatsuch practices would not be tolerated. He further statedthat the incident would be reported to you, the chiefengineer. A few days later, Benson received written notice

from you that he must divest himself of his businesswithin a month or resign from your company.

A month later, Bensons supervisor asked himdirectly for his decision. Benson indicated that he hadthough it over a and talked with friends as well asofficials of the engineers union of which he was amember.


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He stated that he would not give up the business norwould he resign. Bensons arguments were that he was a

good employee and that his outside company did notinterfere with his work for your firm. The small amount ofbusiness that he did could not hurt your company, and hewas neither using the companys resources nor soliciting itsaccounts. Therefore, what he did with his own time was ofno concern to your firm. Benson's supervisor then reportedthe conversation to you.

AS CHIEF ENGINEER, WHAT ACTION SHOULD YOU TAKE?


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Background

Facts :

Charles Benson has been a superior engineer and was areliable employee prior to the problem.

Benson has been with the company for seven years.

The products that Benson firm makes are similar to the

products made by your company.

Bensons supervisor knew about the outside but took noaction for several months.


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Benson states that he will neither give up the business

nor resign form the company.

Benson was ordered by you as chief engineer, in writingto drop the business or resign form the company.

Benson was caught by his supervisor doing business for

his own firm on company time and using a companytelephone.


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Assumptions:

1. Benson has stated that he has contacted union officialsand that they support his position. This is presumed to betrue.

2. Benson states that he is not soliciting companyaccounts. This is presumed to be true.

3. Bensons current level of business will probably not hurtyour company in the sense of his being a competitor. Norwill hiss present product line compete with yourcompanys product line.


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5. Current company policies do not specifically forbid anoutside business, although conflict-of-interest laws as wellas secrecy clauses and the companys ownership of ides

resulting from company work impact on the legal aspectsof the problem.

4. It is assumed that Bensons business activities are no

longer done on company time and his outside work doesnot currently interfere with his work that is done at yourfirm.


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The Charles Benson Problem-Solution

CENTRAL PROBLEM

1.) Should Charles Benson be retained as an employee orfired?

(Limits the solution to two courses of actionretaining orfiring.)

2.) What should be done about Charles Benson?

Lacks specifics about the problem that are important ifthe analysis is to be presented to someone else.)


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( An alternative course of action is assumed as

the solution before the analysis.)

5.) How can Charles Benson be kept with yourcompany?


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ALTERNATIVE SOLUTIONS

1. Discharge Benson

Advantages:

Will enforce discipline, since Benson warned

that he must give up the business or resign.

Will discourage employees in the future fromstarting outside businesses.

Will solve any problem of conflict of interestdue to the nature of Bensons business.


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Disadvantages:

May lead to union problems due to theunions current support of Bensons position

May lead to a morale problem if it is believedby other employees that the company hasacted unfairly.

Will result in the loss of a superior engineerand an otherwise reliable employee.


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Advantages:

Will avoid any problem with the union.

Will result in the companys keeping asuperior engineer and an otherwise reliableemployee.

Will avoid any feeling among otheremployees that Benson is being treatedunfairly.

2. Retain Benson


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Disadvantages:

May result in a discipline problem, sinceBenson was ordered to give up the businessor resign.

May eventually result in a direct conflict of

interest due to the nature of the products andthe customers.

Will effectively establish a company policy

on this matter that may not be desired.

May encourage other employees to startoutside businesses.


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Advantages:

May avoid any problem with the union.

Will reward Benson for past performance asa superior engineer and an otherwise reliableemployee.

Will maintain discipline, since Benson waswarned that he must give up the business orresign.

3. Discharge* Benson as an employee but retainhim as a consultant.

*The mechanism of this discharge should be Bensons resignation.


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Will avoid setting policy or precedentregarding employee businesses.

Will solve any problem of conflict of interestdue to the nature of Bensons business


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Disadvantages:

May encourage other employees to becomeconsultants rather than employees with the

company.

May set policy of a different kind: that

employees who start their own businesseswill be retained as consultant


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DISCUSSION - ANALYSIS

1. Several important issues bear on this problem:

A. The disciplinary issue and the fact that Benson wassold told to resign or to divest himself of his business.

B. The importance of fair treatment and itspotential effect on other employees. Benson has

been a superior engineer and an other wisereliable employees. There is currently no conflictof interest, and may encourage other employees tosimilarly start businesses on their own.


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D. Potential union involvement and a legal suit.

C. The policy issue. If Benson is retained, this willtend to set policy and may encourage other

employees to similarly start businesses on theirown.

2. All of these issues are important and must be considered in thedecision. Therefore:

A. Discharging Benson should be avoided, since it has

considerable potential for affecting the morale of otheremployees (being unfair the first mistake of a superiorand otherwise reliable employee) and could lead toproblems with the union and a legal suit.


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B. Retaining Benson should also be avoided because of its

potential effect on discipline and on setting policy andencouraging other employees to start their ownbusinesses.

C. Discharging Benson as an employee butretaining him as a consultant is the only solutionthat is not negatively affected by the main issues.


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3. If Benson fails to accept the solution ofresigning to become a consultant, then he shouldbe discharged. Under these circumstances thereis less chance of his treatments being perceivedas unfair, and while the company still risks union

problems and a lawsuit, discipline will bemaintained, no policy on outside businesses willbe set, and other employees will not beencourage to follow in Bensons footsteps.


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CONCLUSION

1. Discharging Benson as an employee butretaining him as a consultant is the bestsolution considering the major issuesinvolved.

2. If Benson fails to resign to accept aconsultancy, he should be discharge.


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4. A policy on outside employee business

should be established and publicized assoon as possible.

3. The consultancy approach must be presentedto Benson as the only all-around fair solution, and

not as punishment, in order to maximize thechances of his accepting it; however, it must bepresented in such a fashion that other employeesrecognize the resigning or discharged employeeswill not automatically be hired as consultants.


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RECOMMENDATIONS OR DECISIONS

1. Discharge Benson as an employee and hire him s aconsultant.

3. Establish and publicize a policy on outside employeebusinesses soon as possible.

2. If Benson fails to accept this solution, discharge himimmediately.

charles benson

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