Reference no: EM132217251

Courtney was a manager of a large retail chain store in a major metropolitan area. Shoplifting and employee theft were a major threat to the profitability of the store. During a loss-reduction seminar for store managers, the loss prevention manager from corporate headquarters explained that while it was key to reduce theft losses, many chain stores had a policy of not pressing charges with the police unless a thief had stolen at least $100 worth of merchandise at one time or was a repeat offender. This chain also believed that was the most efficient policy to follow, since it lost money prosecuting smaller cases. Recently the department manager of women’s clothing, Chris, reported that she had seen one of her sales associates put a wrap worth $95 in her handbag and carry it out of the store when she left work for the day. The department manager was rumoured to have had other conflicts with this associate in the past, so Courtney could not be 100 per cent certain that the theft had really occurred. There was no evidence of the theft on the store’s surveillance video, but the video cameras did not cover 100 per cent of the floor area.

What should Courtney do about the reported theft? (Please choose your preferred solution and breifly explain from a leadership standpoint)

1. Tell Chris to let it go because she was enforcing a policy of no reporting of thefts under $100, but tell human resources that this associate had stolen a wrap and should have a note put in her employment file in case she did it again.

2. Ask Chris to meet with the associate and issue a warning that a theft had been observed, and if another one occurred or was suspected, the associate would be terminated and prosecuted in court.

3. Ask the associate to meet with Courtney and talk over the relationship between the associate and her supervisor, but not mention the theft unless the associate reported other false accusations.

4. Arrange for Chris and the associate to meet in Courtney‘s office and discuss the theft and possible consequences of the theft, including the associate losing her job.

5. Ask someone from the human resources department to investigate the accusation and defence of each party and resolve the issue as a possible false accusation, forgetting about the theft since it was under $100.