Ethical Issues: The Tenure of Al Dunlap at Sunbeam Corporation

Dunlap's management fee for accomplishing this kind of result would run to $100 million or so. The Sunbeam project ran additional or a smaller amount genuine to form in between July 1996 and March 1998:

1. Sales rose dramatically, owing partly to promotions funded by a 2500% increase in advertising spending.

2. The stock cost of Sunbeam (SOC) rose from $12.50 per share to $53 per share (Lim, 1998).

3. Eighteen of 26 factories had been closed, as had been 43 out of 61 warehouses. A decentralized regional five-headquarters procedure was consolidated into one headquarters location, in Delray Beach, Florida (Marchetti, 1998).

4. Out of 12,000 employees, 6,000 had been laid off, such as most of Sunbeam's senior managers, who have been replaced by "a team of indefatigable Dunlap disciples" motivated by stock options, not bonuses or raises (Sellers, 1998).

5. Some new products have been introduced, and other merchandise have been discontinued. In September 1997, Sunbeam reported $150 million in sales. That was also as soon as Dunlap's book, Mean Business: How I Save Adverse Firms and Make Excellent Corporations Very good was published by Simon & Schuster and was getting promoted by Dunlap.

By March 1998, Dunlap's performance at Sunbeam was becoming lauded. Against expectations that he might be recruited for the following turnaround, he signed a new three-year contract as CEO and announced that he would build Sunbeam into a consumer-durables giant grossing $2 billion a year.

 

Vidueira, J. (1998, October 23). What is next for Sunbeam following restated earnings? South Florida Company Journal, 19, 10A.

The stakeholders inside Sunbeam downsizing-and-turnaround case have been around all Sunbeam's directors, managers, and employees. Additional stakeholders included the securities market as well as the community of investors, each person and institutional. The sharp decline in shareholder importance since 1998 (Sunbeam's stock traded at much less than $1 per share for most of 2000) items to capacity harm for the integrity of the securities market and to true harm suffered by investors, including modern-day and former employees who may possibly have relied at least in component on a value of Sunbeam's stock for their retirement planning needs. A single could say that Dunlap and his team were also stakeholders , but the impact with the Dunlap tenure at the company set rather differently on that group than on the others.

Still a smaller amount does Dunlap seem to get entertained the idea that corporate restructuring occurs in a bigger moral-ethical context. In Deuteronomy, Moses warns the Israelites against the dangers of prosperity, cautioning them against the view that "it is my own power as well as the strength of my unique hand that has obtained for me this wealth." Forgetting the Lord's hand from the procedure may mean the experience of cosmic justice, this kind of that the wealthy will "perish utterly" (Deut. 8:17, 19). Similar sentiments are found in Proverbs:

Marchetti, M. (1998, January). Dog consume dog world. Sales & Advertising Management, 150, 46-50.

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