Al Dunlap and Sunbeam Corporation

This research examines ethical issues raised by the tenure of Al Dunlap at Sunbeam Corporation. The plan of the research will be to set forth the circumstances under which Dunlap came to be the chief executive officer of Sunbeam and then to discuss the biblically based ethical implications of his accounting practices and his treatment of employees.

In July of 1996, Mr. Al Dunlap was successfully recruited to the position of CEO of Sunbeam Corporation, a publicly traded manufacturer and distributor of household consumer goods. At the time, Sunbeam "was a bloated, barely profitable shell of a company that had suffered through bankruptcy . . . and a parade of ineffective CEOs" (Sellers, 1998, p. 118). Thus the company seemed an ideal management target for Dunlap, who brought to the position a reputation for putting other ailing public companies into profitable turnaround, including Lily-Tulip, Crown-Zellerbach, and Scott Paper. Dunlap was to describe himself as one whose "specialty has been saving companies on the verge of collapse, but I don't just pull them away from the brink. I give them strength and systems for surviving the long days and nights ahead" (Dunlap & Andelman, 1997).

The methods Dunlap used to save companies from collapse were controversial because of the human costs associated with them. In a typical turnaround project, Dunlap would restructure companies by means of staff reductions and cost cutting. The intended result for the company would be cost savings o

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, moods and corporate directions change. The longer it takes, the greater the opportunity for the old corporate culture to corrupt it (Dunlap, 1997, p. 18). Now it could be said that Dunlap's view of trimming losses and cutting costs is consistent with Proverbs 10.4-5: "The slack hand impoverishes, but the hand of the diligent enriches. A son who fills the granaries in summer is a credit; a son who slumbers during harvest, a disgrace." By the way, Dunlap (1997) reports firing a lawyer at Scott Paper who had fallen asleep during an executive meeting. Inefficiencies may have abounded at Sunbeam and Scott paper, but that does not mean that loss of jobs and family dislocation represented the principal locus of harm for employees subject to Dunlap's free hand. The choice of ethical priorities lay between the harm visited on company employees or on shareholders and the very structure of the company. Retaining bad managers and employees would harm those very employees since a free-fall of shareholder value could have forced the company into bankruptcy, thus destroying pensions and jobs in any case. In other words, Dunlap's method of dispensing with deadwood could be defended as the least harmful action, to the degree it could save rema

Category: Business - A