Employee Theft and Organizational Objectives at Capstone Turbine

Introduction

Capstone Turbine Corporation, incorporated in 1988, is an organization that designs and manufactures turbines using the latest technology. These turbines are in demand for hybrid electric vehicles and a range of stationary power applications.

Capstone Turbine Corporation develops, manufactures, and markets microturbine technology, which is used in stationary distributed power generation applications. These include combined heat and power, resource recovery, and power quality and reliability.

Capstone's microturbines are capable of supplying power at consumption sites as well as in hybrid electric vehicles. These sites and vehicles function on the basis of a combination of a primary source battery with an auxiliary power source. The auxiliary power source used here is Capstone's microturbines, which are used to enhance performance.

Capstone is committed to providing customers with top-quality service. Indeed, it is highly capable of doing so, having already established for itself the image of an organization that can significantly reduce companies' expenditure on energy.

Industry Environment

Capstone's energy-saving technology is among the most advanced in the industry. The devices they have designed are capable of running on many types of fuel, such as kerosene and natural gas. This is one reason why organizations such as UTC Power Division and Southern Union Company have been willing to merge with them — firms that are fully aware of Capstone's capabilities and have a great deal of confidence in the way the organization maximizes profits through its internal practices.

Since these organizations hold stakes within Capstone, they must be satisfied with the way profits are maximized and guaranteed through internal practices. Maintaining proper internal practices is essential for an organization to reach its maximum profit potential.

At present, there are no rivals capable of causing Capstone significant harm. This is largely because Capstone holds a kind of technological monopoly in the types of products it produces. No other organization has produced energy-saving goods of equivalent advancement, and this is why several organizations are willing to merge with them. Features such as remote control monitoring are not characteristics of competing products. In addition, Capstone's products significantly reduce the amount organizations spend on energy. Energy-supplying organizations are therefore more than willing to merge with Capstone so that the alliance allows them to sell their products while also profiting from Capstone's sales (Gelsi, 2002).

The alliances formed between Capstone and energy-supplying companies are ones that please customers — particularly those already receiving energy from firms that have merged with Capstone.

Major consumers of clean energy include vehicle companies, hotels, hospitals, and similar large-scale users. Because these consumers use large quantities of energy, they are among the most likely to be significant environmental polluters. However, this problem is greatly reduced when they adopt Capstone's microturbines, which reduce the emission of environmentally harmful substances.

Customers recognize the value of the microturbine for several reasons beyond reducing air contamination. The latest models produced by Capstone are approximately the size of a large refrigerator, making them convenient to move and reposition — unlike older turbine models that cannot be relocated easily. This compact size also makes it possible to integrate the device into large vehicles such as refrigerated trucks used to transport frozen goods, saving companies a considerable amount of money.

Because Capstone serves a large number of customers across different energy types, it must continuously maintain its standards to hold its market position. It is ultimately the customers who have made Capstone what it is, and it is also the customers who are capable of reducing the organization's profits if their needs are not being met.

Energy companies acting as suppliers are also of significant importance. Their mergers with Capstone reflect confidence in the organization, and if those mergers were to dissolve, it would signal serious internal problems. It therefore appears that suppliers are of equal importance to Capstone as customers are. Beyond these two stakeholder groups, there are no other major external threats, since Capstone remains well ahead of other microturbine producers.

Maintaining this position requires maintaining a sound internal environment. Capstone has encouraged employee retention by allowing employees to share in profits, which serves as a meaningful incentive. As one management resource notes, "Employee retention is the key to customer retention, and customer retention can quickly offset higher salaries and other incentives designed to keep employees from leaving" (Winning Strategies for Recruiting and Retaining Quality Employees, 2002).

Issues of employee theft must also be considered. In Capstone's case, the physical theft of turbines the size of large refrigerators is highly unlikely. However, the protection of the technology used in manufacturing their products is a genuine concern. Employees must be informed in advance that they are not to disclose organizational information to competitors, as this would represent a significant loss for Capstone. Employees who handle sensitive information must also be thoroughly screened, since any prior misconduct is likely to recur in any subsequent organization. By reducing the chances of such theft, Capstone can maintain its commanding position in the market through the protection of vital proprietary information.

With information properly retained within the organization, there are no credible threats of other organizations displacing what Capstone has built for itself.

The external environment also favors Capstone's continued success. There are no regulatory restrictions on merging their products with those of energy suppliers, which reduces the risk of antitrust concerns of the kind seen with other organizations, such as Microsoft.

Macro Environment

The widespread need for energy-efficient products such as Capstone's likely gives governments little reason to interfere with Capstone's operations. The fact that energy suppliers are merging with Capstone voluntarily confirms that the company is technologically ahead of its rivals in this space. Since Capstone maintains its technological advantage through secrecy, it is well positioned to continue earning profits.

This product also allows Capstone to transcend social and cultural differences. Because it generates strong profits and operates smoothly, it is evident that the organization is functioning well internally.

Depending on an organization's location and the composition of its workforce, it develops a culture of its own. The type of management involved also influences that culture significantly. These two factors are broadly analogous to sociological perspectives on society and its governing bodies.

Internal Environment

In a multi-ethnic society, the chances of conflict are reduced when governing bodies are unbiased. Within organizations, management similarly has a responsibility to be fair — and this is the first prerequisite for smooth organizational functioning.

In a diverse working group, issues such as racism can create an uncomfortable atmosphere and reduce overall output. Rather than addressing such problems reactively, Capstone implements frameworks that set clear expectations before employees join the organization. One such framework is the structural frame (Capstone Introduces Mutual Fund, 2002).

The structural frame exists to achieve organizational goals through a social context, recognizing that goal attainment depends on all members of staff, not management alone. Six basic principles implemented within this frame are as follows:

1) Organizations exist to achieve established goals and objectives.
2) Organizations work best when rationality prevails over personal preferences and external pressures.
3) Structures must be designed to fit organizational circumstances.
4) Organizations increase efficiency and enhance performance through specialization and division of labor.
5) Appropriate forms of coordination and control are essential to ensuring that individuals and units work together in the service of organizational goals.
6) Problems and performance gaps arise from structural deficiencies and can be remedied through restructuring (Bolman & Deal, 1997).

These principles make it easier to understand how management maintains control over discrimination through clearly communicated organizational expectations. The productivity observed at Capstone suggests that employees have been well managed, and this reflects positively on the organization's leadership. It is through such management that Capstone also has great potential to expand internationally, offering a product that can substantially cut energy spending in any market.

Conclusion

Given the above discussion, it can be concluded that Capstone has a great task ahead of itself. There is great potential for the company to expand, but first it must implement an ethical framework that complements its internal and external business environment. For the past several years, Capstone has continued operating despite its losses and its inability to fully capitalize on the slow-moving microturbine market. One contributing reason is that the company has not been able to align its mission statement with its operational objectives. This has created a gap between management and employees, such that management must now implement a screening process to help the organization achieve maximum standards in business development and quality delivery.