Rachel Gambol is assistant controller at Recycled Packaging, a manufacturer of cardboard boxes and other packaging materials. Gambol has just returned from a packaging industry conference on ABC. She realizes that ABC may help Recycled Packaging meet its goal of reducing costs by 5% over each of the next three years.
The company's Order Department is a likely candidate for ABC. While orders are entered into a computer that updates the accounting records, clerks manually check customers' credit history and hand-deliver orders to shipping. This process occurs whether the sales order is for a dozen specialty boxes worth $80 or 10,000 basic boxes worth $8,000.
Gambol believes that identifying the cost of processing a sales order would justify (1) further computerizing the order process and (2) changing the way the company processes small orders. However, the significant cost savings would arise from elimination of two positions in the Order Department. The company's sales order clerks have been with the company many years. Gambol is uncomfortable with the prospect of proposing a change that will likely result in terminating these employees.
Requirement
Use the IMA Statement of Ethical Professional Practice (from Chapter 1 ) to consider Gambol's responsibility when cost savings come at the expense of employees' jobs.