Bayani Case

Dela Rea, Kimmi F.

Navales, Reihnier J.

Jose Bonifacio, the majority stockholder and chairman of the board of

directors of Bayani Company, was dissatisfied with the top executive of the
company, a manufacturer of LED screens. The stockholders had invested
P50 million and the return on their investment had been poor for the past 3
years. In the last meeting of the Board at the start of the year, Bonifacio
fired the chief executive officer and (with Board approval) appointed
himself as the new CEO. At the first management meeting, he asked two of
the managers to stand up and then fired them on the spot. At the budget
review meeting that followed, he ripped up the departmental budgets that
had been submitted for his review and yelled at the managers for
submitting weak targets. He then ordered everyone to submit new budgets
calling for at least 13% increase in sales and announced that he would not
accept excuses for results that fell below target.
Andres Mabini, an ECE engineer working for the production manager,
discovered toward the end of the year that his boss, Manuel Rizal, had not
been scrapping defective LED screens that had been returned by
customers. Instead he had been shipping them (repaired) as new
customers in order to avoid booking losses and increase production output.
Quality control had detoriorated during the year as a result of the higher
production rate and returns of defective screens were running as high as
17% (previously 3%) of the new screens shipped. Mabini even managed to
derive an equation showing linear relationship between production volume
and returns. When he confronted his boss with his discovery, Manuel told
him to mind his own business. And then, in the way of a rationalization for

-majority
stockholder and
chairman of the
Board of Directors
of Bayani Company.

Jose
Bonifacio
-ECE engineer
working for the
production
manager

Andres

-ECE
engineer,
boss of
Andres
Mabini

Manuel Rizal

Major Problems
The stockholders had invested P50 million and the return
on their investment had been poor for the past 3 years
the main struggle is that the financial capability of the company
is low and as a result it cannot compensate to the return of
investment that the investors should received.

Large increase in sales is demanded. As the new CEO of

the company Jose Bonifacio demanded an immediate budget
calling which requires at least 13% increase in sales. This problem
results to a struggle between the managers, in fear of being fired.
Quality Control had deteriorated this is due to the higher
production rate and return of defective screen were running as
high from 3% to 17%.

Problem
What will Jose Bonifacio, Andres
Mabini, and Manuel Rizal do to return
the investment for the company and
stockholders without affecting the
service to their customers?

Point of view and personal analysis of main

characters

Jose Bonifacio- As the new CEO, he is obliged to produce a better strategy in

order for the company to compensate with the loss and satisfy the rate of return
of investment among the investors. Since he is successful in dethroning the
present CEO he used his power in order to raise the awareness of his members
that he is the one in charge and he have a power to do what he think is right for
the company. He acknowledges his own strength and he doesnt acknowledge
others weaknesses.

Andres Mabini an ideal engineer which as the case describe brings glory to
the company by giving what is due to the customer. He is the one who
confronted Manuel Rizal which happen to be his boss, about its wrong doing of
not scrapping defected material that was return by customer but instead
repairing it and eventually ship it to the customer.
Manuel Rizal- In order for him as a manager to reach the target sales
conducted by the CEO he does what it takes to increase the sale and conceal the
loss. By this doing he is depriving the customer to get what is due to them.

Ethics
III. Professional Obligations
Engineers shall be guided in all their relations by the highest standards of honesty and
integrity.

33. He shall uphold the honor and dignity of his profession and avoid association in
responsibility for work with engineers who do not conform to ethical practices.

35. He shall cooperate in extending the effectiveness of the engineering profession and
endeavor to be well-informed of the latest development in the profession by sharing or
exchanging information and experience with other engineers, other professionals and
students; and by contributing to engineering publications and schools and by participating
in the activities of engineering societies.

Relation with Client, Employer and laborer.

He shall inform his client or employer of any financial interest on inventions, devices,
equipment or any other thing, before undertaking any engagement in which he may be
called upon to decide on the use thereof.

Jose Bonifacio
Option 1: Continues to pressure his employees especially managers to have
at least 13% increase in sales.

Pros: his company will return the investments coming from the stockholders
within a short period of time.
Cons: his managers will copy Manuel Rizals wrong doings just to reach the
13% sales of LED screens and some will resign from the company for the
pressure their CEO was given to them

Option 2: talk to his employees that there is an alternative way to return the
investment to the stockholder like house to house sell of LEDs and avoid
scrapping defective LED screens.

Pros: the company will have the trust of their customers again.

Cons: the return of investment from the LED screen will take long period of
time.
Solution: In every company, the customers are their number 1 priority. We

Andres Mabini

Option 1: if confrontation is not enough, a report to the higher personnel within the
company should be considered.

Pros: proper service and equipment were being given to the customers and he can
achieve a reward for being honest.

Cons: If the higher personnel consider the way of Manuel Rizal in solving problems. There
is a possibility that Andres Mabini will lose his job.
Option 2: ignore the problem and support what his boss are doing about the problem.

Pros: He will maintain his job

Cons: the Quality control will continue to deteriorate.

Solution: Even though there is a possibility that he will lose his job we will go for Option
1. Andres mabini is an engineer he is fully aware that Engineers shall be guided in all their
relations by the highest standards of honesty and integrity. Customers should be the main
priority of their company if more customers will be unsatisfied it can ruin the reputation of
the company and as the present situation of the company they will never be compensate
with the return of investment. The worst is the company will fall.

Manuel Rizal
Option 1: Continue to implement his strategy and fire Andres Mabini.
Pros: he will maintain his job and achieve the target goal. He will get rid of Andres
Mabini being hindrance with his plan.
Cons: the company will lose one honest engineer.
Option 2: He will make up his mind and do what is just.
Pros: the customers will get what is due to them.
Cons: if he will not achieve the given target sales. He will lose his job.
Solution: We will go for Option 2 it is good to start doing the right thing early.
Manuel should instead think of a better strategy that will not harm the right of the
customer maybe he can ask help to his colleague. There is always another way.
And also if he continue to do his strategy more problem will occur with the
customers and eventually he will also lose his job so he better take the risk.