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Curriculum Center Browse Bibliography Build EPacket Pricing Structure Distribution Process Management Control in Nonprofit Organizations
 
The Expiring Software License
Author(s):
Merchant, Kenneth A.
Porter, Leslie R.
Functional Area(s):
   Management Control Systems
   Organizational Behavior
Setting(s):
   For Profit
Difficulty Level: Beginner
Pages: 1
Teaching Note: Available. 
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First Page and the Assignment Questions:
On September 30, Jianxin (Jimmy) Wu, manager of the Information Systems Department for Southwest Industries (SWI), was in panic mode. SWI was a medium-size manufacturer of portable shelters, tents, and awnings. Jimmy was panicking because the company's Citrix software had just died. Because of his oversight, an invoice had not been paid, and SWI's license to use the software had expired. This was the second time in a month that he had failed to complete an important task.

Jimmy knew that something had to be done very quickly. Many of the company's information systems users, who were situated at three different locations, relied heavily on the Citrix software. All of SWI's applications ran under Citrix. The Citrix software gave all employees access to the SWI applications they needed no matter where they were, as long as they had access to the Internet. The Citrix license renewal would cost $3,600, but going through the purchasing department to get a requisition issued would take at least several days. The users could not be without the Citrix capability for that long.

Jimmy first thought about asking Citrix for an extension while the purchasing department processed the payment, but he doubted that it would be granted. SWI was a notoriously slow payer. The last time SWI asked Citrix for a similar extension, it actually took the SWI purchasing department several weeks to pay the invoice. Citrix personnel were quite annoyed at this delay.

Then Jimmy thought about using his purchasing card. The card, which worked like a credit card, was intended for small purchases, not including travel, hotels, or food. SWI issued the card to some of its key personnel to avoid the costs of processing the paperwork required for many small, incidental purchases. The company only had to make one single payment to the credit card company, and the credit card company did all the processing

The maximums placed on Jimmy's card were $2,000 for any single purchase, and $5,000 per month. Jimmy knew that these limits were strictly enforced. Personnel in the accounting department scanned the bills monthly looking for violations. But Jimmy thought that he could get Citrix to split the bill in two, and then the accounting department personnel would not raise any objections.

With no other apparent options at hand, Jimmy decided to try to use his card to renew the license. The Citrix salesman agreed to charge the card in two transactions of $1,800 each. The license was renewed quickly, and few of SWI's Citrix users were ever aware that there had been a problem.
 
Assignment

1.    Did Jimmy Wu act in an ethical manner in using his purchasing card to renew the Citrix software license?