Case Study: Sunshine Company

Sunshine company faces the nonexistence loyalty from their own employees. Although the company needs to change their recruitment process, even then they might still have dishonest employees running their stores. This limitation is crucial because Sunshine is losing revenue every year. In addition, if their customers find out the branch managers have been pocketing their extra money they could be saving they will lose loyal customers. Sunshine can control who they hire however they may still be hiring individuals who may seem loyal but are really thefts. You cannot change who someone is.
Sunshine’s main conflict is their recruiting process of having un-loyal branch managers, who should be a professional, inspiring role model to the staff below

By 2010, it had three industrial facilities (situated in Shenzhen, Shanghai, and Taiyuan in Shanxi region), 220 sales counters in retail chains all through the nation, and a workforce of more than 1,000 representatives.
Sunshine created somewhere in the range of 300,000 pieces for every year for local sales, a portion that appreciated an impressively higher overall revenue than its fare business. With a turnover of Rmb 150 million, domestic sales made up more than 66% of Sunshine 's business. Sunshine was situated as a top of the line style brand in the local business sector, with configuration being the main component in deciding the offers of its products. At Rmb 3,0001 each, Sunshine 's cashmere sweaters were viewed as an extravagance thing in China.
Since the clients of Sunshine were fashion cognizant, the estimation of an out-of-season item could tumble to as low as 33% its unique cost. Sunshine 's vertically coordinated association gave it an aggressive edge over its rivals. It could finish the item cycle from outline to circulation inside of 20 days, while its real rival Edor took three

They began experiencing serious fraud and misbehavior among their employees. The company estimated losing from a range of Rmb 9.3 million and Rmb 10.5 million, which equals out to be more than 5% of Sunshine’s total domestic sales. Since Sunshine is using the RFID/ERP system, managers are able to cheat the system. Every four hours the head office receives updates on the point-of-sale, these managers took advantage of the incapability of top management to control aspects at the local level. Although the head office was responsible for setting timeframes for promotions to go out, branch managers were not trustworthy. By doing this branch managers were able to sell sweater at original prices and pocket the difference. Another thing branch managers would do is report a higher discount rate to the head office and pocket that