CREDIBILITY   CASE

E-kin has been live on the Internet for just over a month. To date, the sales growth has been just above what they anticipated, but E-kin has had no problem meeting customer’s demands. In fact, E-kin’s production facility has only been at 30% of capacity since they have invested in their new state of the art manufacturing equipment. E-kin is still a very young company. Tensions are running high among the management staff, with increased pressure from the CEO to boost performance at all levels of the organization.

8:00 AM Management Meeting -- E-kin conference room

Attendees: CEO -- Slim Pickens
                CFO – Won Dour Trump
                CIO -- Cam Crawford
                Sales/Marketing -- Ken E. Sellit
                Customer Service – Maria Whinnor
                Production – Jennifer Valley

CEO: "I was reminded late yesterday by Won Dour (CFO) that our production facility is not being utilized very well. We are not even producing enough products to make our lease payment each month. Won Dour could you explain to everyone the original forecasting and the sales volume needed to break even."

CFO: "As I explained to everyone in the original forecasting, we need to have our production facility running around 45% capacity to break even. With anything above that capacity, E-kin will begin to recognize a profit for that period."

Production: "You aren’t trying to emphasize that my facility isn’t efficient, are you?"

CEO: "Won Dour isn’t saying that at all!" " What he is saying is that we need to generate some sales in order to make our payments. After we reach a breakeven level, we can begin to focus on the future and hopefully some profit."

Production: "I know our facility has the capacity to perform much more efficiently than we have shown everyone so far. Once we have some steady volumes we can improve our process efficiencies. Why doesn’t Ken (Sales/Marketing) start doing what ever it takes to generate some additional sales?"

Sales/Marketing: "I know we haven’t experienced the sales volume that we would like to have seen through the Internet. We are currently working on some new campaigns." "Our consultant felt that one of our areas needing improvement was our focus on credibility as an e-business."

CEO: "Jennifer (Production), I know you would never suggest that Ken perform unethically to generate sales! I have stressed the importance of ethics within E-kin from day one and we aren’t about to lose focus on what E-kin stands for."

     Lets take a moment to review some ethical questions that relate to E-kin’s situation.

  1. How much focus should there be, morally speaking, on developing credibility at E-kin?
  2. What are some things that E-kin could do to improve their credibility with existing and prospective customers?
  3. What impact does the type of security on their web site have on E-kin’s credibility?
  4. Should E-kin disclose to customers their privacy policy concerning customer information that is collected? Will this affect their credibility? Why or why not?
  5. In what ways could the active management of E-kin’s credibility create moral dilemmas for the company? For example, dilemmas related to sales volume?
  6. What is the relationship between credibility and ethics in e-commerce?

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E-Kin1: A Case Study
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