By- Pravendra Kumar

 DCA to shutdown 72 Sears Auto Centers

and there were similar charges against
Six local Sears Auto Centers and several
other states including Florida, Illinois, and
New York

 Charges were that Sears Auto

Recommending unnecessary repairs and
services.
 Critics of Sears that there were not
enough safeguards to protect Customers
 Company claiming that no part replaced
unless it was necessary and were
legitimate.
 Sales goals turned into Conditions of
Employment and that the managers were
busy with charts and graphs
 Edward announcement of eliminating
incentive compensation system he also
ensured that no overcharging would occur.

 Edward paid $8 millions to settle claims in

California and gave auto center customers
$50 coupons that cost around $ 3 millions.
 The total cost including legal bills & LOST
sales is estimated to be $ 60 Million
 Sears Planned to spinoff its three
nonretail divisions All state, coldwell
Banker and Dean Witter.

 New CEO Arthur C. Martinez began to

bring a turnaround in the company.

 Martinez said. “I want to revisit and

intensify the theme of our customers
being the center of our universe”.
 What are the unethical ways and means
used by the employees of the sears auto
centers to increase their business of
repairs and services of automobiles?
 Do you agree with the argument put
forward by sears auto services that many
repairs carried out by the company were
legitimate preventive maintenance
 Why did California DCA Authorities
charge that problems at the sears Auto
Centers were not not confined to a few
isolated events, but constituted
Systematic Consumer Fraud?
 The changes in the compensation System
at Sears Auto Centers after 1990 and the
overall thrust to make every employee
from the sales force to the chairman's
Suite focus on profit are the major
reasons for the unethical ways and
means adopted by the employees, do
you agree with the statement ? Explain
your answer.
 What are the your comments on the
vision of the new CEO Arthur C Martinez?
Is he moving in the right direction?
 Clean business ethics because
 Lose in business
 Decrease in the value of the company
 Spot on the image of the company
 Long term vision
 Do good and get good or vice-versa.
Do you feel that small and large Auto garages in India
/Mumbai follow similar Unethical Ways and means
of making money or are they more honest than their
counter parts in USA?
Problems ???
Minor problems and more repairs
Charged for parts that were not installed
Replacing original part by duplicate ones