Radioshack Case Study

Topics: Ethics, Stock, Stock market Pages: 2 (682 words) Published: December 24, 2011
1. Being on top of the corporate ladder places a huge responsibility on a person to provide ethical leadership, being a good role model, and David Edmondson failed to do that. Firstly by claiming two false graduation degrees (theology and psychology) deceiving everyone that he was qualified for the job. Secondly, being charged of DWI is another failure of ethical leadership qualities especially if you’re the CEO of a company because it puts you directly into the limelight. But I also believe Mr. Edmondson’s apology to the board for the bad performance of the company can be considered as an ethical behavior because he did not try to cover up his fault. What RadioShack could have done to prevent this kind of incident is to apply stricter rules on hiring new employees, conduct background investigations about the applicants, had they done that they would’ve known David Edmondson did not have his two degrees and was not an appropriate person for the job according to the company’s code of ethics. They also could have prevented themselves from losing more money by immediately firing him without paying him anything as compensation because he had deceived the company.

2. This situation impacted a lot of people because RadioShack was a big company with many stakeholders, mainly:

i. The investors.
The investors might not have been satisfied of this situation because they are the people who are generally interested in the good functioning of the company and due to this situation the company started losing money, customers, reputation and most of all share price, which went down to a 3 year low.

ii. Employees.
A big number of employees lost their jobs when RadioShack closed around 500 shops in early to mid 2006. Secondly, the employees did not want to be managed by an uneducated person but their concern was that they were unable to do anything about the situation.

iii. Customers.
The customers might have had concerns over buying products from a company whose...
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