UNIT-1

Business Ethics: An overview, Concept, Nature

Ethics is a branch of social science. It deals with moral principles and social values. It helps us to
classifying, what is good and what is bad? It tells us to do good things and avoid doing bad things.

So, ethics separate, good and bad, right and wrong, fair and unfair, moral and immoral and proper and
improper human action. In short, ethics means a code of conduct. It is like the 10 commandments of holy
Bible. It tells a person how to behave with another person.

In short, business ethics means to conduct business with a human touch in order to give welfare to the
society.

So, the businessmen must give a regular supply of good quality goods and services at reasonable prices to
their consumers. They must avoid indulging in unfair trade practices like adulteration, promoting
misleading advertisements, cheating in weights and measures, black marketing, etc. They must give fair
wages and provide good working conditions to their workers. They must not exploit the workers. They
must encourage competition in the market. They must protect the interest of small businessmen. They
must avoid unfair competition. They must avoid monopolies. They must pay all their taxes regularly to
the government.

Definition of Business Ethics

According to Andrew Crane,

“Business ethics is the study of business situations, activities, and decisions where issues of right and
wrong are addressed.”

According to Raymond C. Baumhart,

“The ethics of business is the ethics of responsibility. The business man must promise that he will not
harm knowinfly.”

According to Wikipedia,

“Business ethics (also corporate ethics) is a form of applied ethics or professional ethics that examines
ethical principles and moral or ethical problems that arise in a business environment. It applies to all
aspects of business conduct and is relevant to the conduct of individuals and entire organizations.”

Nature of Business Ethics

The characteristics or features of business ethics are:

 Code of conduct: Business ethics is a code of conduct. It tells what to do and what not to do for
the welfare of the society. All businessmen must follow this code of conduct.

 Based on moral and social values: Business ethics is based on moral and social values. It
contains moral and social principles (rules) for doing business. This includes self-control,
 consumer protection and welfare, service to society, fair treatment to social groups, not to exploit
others, etc.

 Gives protection to social groups: Business ethics give protection to different social groups such
as consumers, employees, small businessmen, government, shareholders, creditors, etc.

 Provides basic framework: Business ethics provide a basic framework for doing business. It
gives the social cultural, economic, legal and other limits of business. Business must be
conducted within these limits.

 Voluntary: Business ethics must be voluntary. The businessmen must accept business ethics on
their own. Business ethics must be like self-discipline. It must not be enforced by law.

 Requires education and guidance: Businessmen must be given proper education and guidance
before introducing business ethics. The businessmen must be motivated to use business ethics.
They must be informed about the advantages of using business ethics. Trade Associations and
Chambers of Commerce must also play an active role in this matter.

 Relative Term: Business ethics is a relative term. That is, it changes from one business to
another. It also changes from one country to another. What is considered as good in one country
may be taboo in another country.

 New concept: Business ethics is a newer concept. It is strictly followed only in developed

countries. It is not followed properly in poor and developing countries.

Advantages of Business Ethics

More and more companies recognize the link between business ethics and financial performance.
Companies displaying a “clear commitment to ethical conduct” consistently outperform companies that
do not display ethical conduct.

1. Attracting and retaining talent

People aspire to join organizations that have high ethical values. Companies are able to attract the best
talent and an ethical company that is dedicated to taking care of its employees will be rewarded with
employees being equally dedicated in taking care of the organization. The ethical climate matter to the
employees. 

Organizations create an environment that is trustworthy, making employees willing to rely, take decisions
and act on the decisions and actions of the co-employees. In such a work environment, employees can
expect to be treated with respect and consideration for their colleagues and superiors. It cultivates strong
teamwork and Productivity and support employee growth.

2. Investor Loyalty

Investors are concerned about ethics, social responsibility and reputation of the company in which they
invest. Investors are becoming more and more aware that an ethical climate provides a foundation for
efficiency, productivity and profits. Relationship with any stakeholder, including investors, based on
dependability, trust and commitment results in sustained loyalty.

3. Customer satisfaction

Customer satisfaction is a vital factor in successful business strategy. Repeat purchases/orders and
enduring relationship of mutual respect is essential for the success of the company. The name of a
company should evoke trust and respect among customers for enduring success. This is achieved by a
company that adopts ethical practices. When a company because of its belief in high ethics is perceived as
such, any crisis or mishaps along the way is tolerated by the customers as a minor aberration. Such
companies are also guided by their ethics to survive a critical situation. Preferred values are identified
ensuring that organizational behaviours are aligned with those values. An organization with a strong
ethical environment places its customers’ interests as foremost. Ethical conduct towards customers builds
a strong competitive position. It promotes a strong public image.

4. Regulators

Regulators eye companies functioning ethically as responsible citizens. The regulator need not always
monitor the functioning of the ethically sound company. The company earns profits and reputational
gains if it acts within the confines of business ethics. To summaries, companies that are responsive to
employees’ needs have lower turnover in staff.

 Shareholders invest their money into a company and expect a certain level of return from that
money in the form of dividends and/or capital growth.

 Customers pay for goods, give their loyalty and enhance a company’s reputation in return for
goods or services that meet their needs.

 Employees provide their time, skills and energy in return for salary, bonus, career progression,
and learning.

Scope of Business Ethics

Ethical problems and phenomena arise across all the functional areas of companies and at all levels within
the company.

1. Ethics in Compliance

Compliance is about obeying and adhering to rules and authority. The motivation for being compliant
could be to do the right thing out of the fear of being caught rather than a desire to be abiding by the law.
An ethical climate in an organization ensures that compliance with law is fuelled by a desire to abide by
the laws. Organizations that value high ethics comply with the laws not only in letter but go beyond what
is stipulated or expected of them.

2. Ethics in Finance

The ethical issues in finance that companies and employees are confronted with include:

 In accounting – window dressing, misleading financial analysis.

  Related party transactions not at arm’s length

 Insider trading, securities fraud leading to manipulation of the financial markets.

 Executive compensation.

 Bribery, kickbacks, over billing of expenses, facilitation payments.

 Fake reimbursements

3. Ethics in Human Resources

Human resource management (HRM) plays a decisive role in introducing and implementing ethics. Ethics
should be a pivotal issue for HR specialists. The ethics of human resource management (HRM) covers
those ethical issues arising around the employer-employee relationship, such as the rights and duties owed
between employer and employee.

The issues of ethics faced by HRM include:

 Discrimination issues i.e. discrimination on the bases of age, gender, race, religion, disabilities,
weight etc.

 Sexual harassment.

 Affirmative Action.

 Issues surrounding the representation of employees and the democratization of the workplace,
trade.

 Issues affecting the privacy of the employee: workplace surveillance, drug testing.

 Issues affecting the privacy of the employer: whistle-blowing.

 Issues relating to the fairness of the employment contract and the balance of power between
employer and employee.

 Occupational safety and health.

Companies tend to shift economic risks onto the shoulders of their employees. The boom of performance-
related pay systems and flexible employment contracts are indicators of these newly established forms of
shifting risk.

4. Ethics in Marketing

Marketing ethics is the area of applied ethics which deals with the moral principles behind the operation
and regulation of marketing. The ethical issues confronted in this area include:

 Pricing: price fixing, price discrimination, price skimming.

 Anti-competitive practices like manipulation of supply, exclusive dealing arrangements, tying

arrangements etc.
  Misleading advertisements

 Content of advertisements.

 Children and marketing.

 Black markets, grey markets.

5. Ethics of Production

This area of business ethics deals with the duties of a company to ensure that products and production
processes do not cause harm. Some of the more acute dilemmas in this area arise out of the fact that there
is usually a degree of danger in any product or production process and it is difficult to define a degree of
permissibility, or the degree of permissibility may depend on the changing state of preventative
technologies or changing social perceptions of acceptable risk.

 Defective, addictive and inherently dangerous products and

 Ethical relations between the company and the environment include pollution, environmental
ethics, and carbon emissions trading.

 Ethical problems arising out of new technologies for eg. Genetically modified food

 Product testing ethics.

Evolving ethical values

Dated back to Code of Hammurabi some 4,000 years ago, business ethics is a social science, whose
main aim is to define and examine the responsibilities of businesses and their agents as a part of the
general moral environment of a given society.

Business ethics refers to how ethical principles guide a business’s operations. Common issues that fall
under the umbrella of business ethics include employer-employee relations, discrimination,
environmental issues, bribery and insider trading, and social responsibility. While many laws exist to set
basic ethical standards within the business community, it is largely dependent upon a business’s
leadership to develop a code of ethics. Practicing strong ethics keeps a business within the parameters of
the law; as well as building goodwill and brand equity. Popular social issues largely drive business ethics;
as different issues come to the forefront, organizations respond by bringing their ethical tenets in line with
the new social norms.

Business Ethics in the ’60s

The 1960s brought the first major wave of changes in business ethics. Cultural values were shifting, with
individualism and fierce dedication to social issues such as environmentalism and world peace coming
into vogue. While young workers were idealistic and wanted to make the world a better place, employers
found their work ethic, compared to that of previous generations, to be lacking. Drug use was rampant,
and the new focus on individualism caused many workers to look upon their employers with disdain.

Companies responded by beefing up human resources departments and establishing mission statements
and codes of conduct. In response to the changing desires of their employees, however, businesses also
began embracing social responsibility at a level not previously seen; the 1960s saw companies trumpet
environmental friendliness for the first time and find new ways to give back to their communities.

Major Events in the ’70s and ’80s

During the 1970s and 1980s, two events shaped changes in business ethics: defense contractor scandals
that became highly publicized during the Vietnam War and a heightened sense of tension between
employers and employees. In response, the government implemented stricter policies governing defense
contractors, and companies revamped contracts with employees to focus less on rigid compliance and
more on values; popular management philosophy shifted from pure authoritarianism to more
collaboration and working on equal footing.

The ’90s and Environmentalism

The 1990s saw a rebirth of environmentalism, social responsibility reaching new heights and graver legal
ramifications for ethical missteps. Tobacco companies and junk food manufacturers faced heightened
scrutiny, along with several highly publicized lawsuits, over the public health ramifications of their
products. Oil companies and chemical companies had to contend with increasing public pressure to
answer for environmental damage. Class action lawsuits rapidly gained in popularity; in response,
businesses were forced to spend more on their legal departments.

The Online Realm in 2000+

From the year 2000 forward, business ethics have expanded to the online realm. The big ethical dilemmas
of the 21st century have mostly centered on cybercrimes and privacy issues. Crimes such as identity theft,
almost unheard of 20 years before, remain a huge threat to anyone doing business online—a majority of
the population. As a result, businesses face social and legal pressure to take every measure possible to
protect customers’ sensitive information. The rise in popularity of data mining and target marketing has
forced businesses to walk a fine line between respecting customers’ privacy and using their online
activities to glean valuable marketing data.

Arguments against Business Ethics

Businesses are not real: They are conceptual, abstractions. The big change that moved us towards the
huge multinational businesses we see today was the legal decision to allow businesses to be treated as
their own entities and we should honour that separation.

The same is true of government when people talk about government morality.

The sole purpose of any business is to make money.

The sole purpose of a government is to retain stability, order and retain power.

Ethics are personal. This is not to say they aren’t important, they are. They should be venerated to the
degree that wealth and youth are in western society, even if they aren’t.

Businesses and democratic governments are abstractions we created to fulfil human needs and desires.
We want to have lots of money and not have a dangerous, chaotic environment.
 Politics and business leverage evolution. We have created artificial environments with artificial
rewards. Organisms that can’t get enough food, keep themselves safe and attract a mate die. This works
remarkably well and has for a very very long time. It is the only successful way to create an efficient
economy that can improve quality of life, alternatives like communism fail in the large scale because they
can’t provide this evolutionary simulation.

Business has a clear metric – money. If you make a profit you survive, if you don’t you ‘die’
(bankruptcy). Businesses can breed (merge), they can grow. A characteristic of any living organism has to
be passed on through breeding but business ideas that work spread regardless. Think agile programming,
or the idea of specialisation at work even at a more basic level. Businesses that implemented them had a
greater chance of success, more of them survived. Now most surviving businesses implement them.

So where does ethics come in? Two places. Businesses should be ethical if it makes them money. There
are defined markets for ethical goods. People are attracted by fair trade labels, they will (sometimes) pay
more to know the workers who made their clothes live acceptable lives.

The second is people in the business. They have the responsibility to ethical because they are people, real
people, not abstract concepts.

Which has two implications:

1. People should not be overly celebrated for being rich. This is not a virtue.
2. People should be celebrated for their ethics.

The reverse obviously being true for companies.

The problem is a western culture that overvalues entrepreneurs, apologies entrepreneurs. There are many
dangerous side effects of this.

When evaluating the success of a company you might say how wonderful apple is for example. They hit
the $1 trillion valuation today. You remark about how great their profit margins are. How wonderful they
are at marketing their products. How good they are at turning relatively cheap hardware into a product
that feels and seems to react in a premium way. How good they are at trapping people in their ecosystem.

But there is no point judging apple by its ethics because it isn’t designed to be ethical.

But this DOESN’T transfer to the person in charge, or the people in charge. It is strange. Why judge those
peoples success on their ability to generate wealth, which is their profession and not judge an engineer by
his ability to write code or build bridges? It doesn’t make any sense. Someone making lots of money is
neither good nor bad. Whether they make that responsibly is entirely different.

People whinge all the time about businesses not being ethical, when it isn’t their purpose to be ethical. It
is, purely, people shirking their responsibility to exercise ethics. You can’t defer the problem by blaming
these other entities. That leads to the weak thinking that there is no point trying to be ethical because
these huge entities are evil and have all the power.
 The key for people is to remember you have no control businesses or anyone else, all you can do is
attempt to exercise self control and act ethically, as well as encourage everyone else to do the same. This
applies at work and at home

The key for business ethics is for the workers to exercise ethics and to remember that the business is the
abstract concept, made of people making decisions. It is NOT the case that you are just ‘a cog of the
system’ and thus your role is purely profit driven, because it isn’t the case.

Whether or not the company is considered “ethical” with the positive connotation we normally give this
word is another matter that involves judgments based on morality. Such a label is subjective, but the
business community, as a whole, looks at key factors to decide whether or not a business is practicing
good business ethics:

 Business structuring
 Moral decision making
 Ethical business principles

One of the foundations of business ethics is the theory of utilitarianism. Utilitarianism states that, when
weighing all options, the option that produces the greatest net benefits for the least net cost, is the most
ethical option. Which factors are considered in this cost/benefit analysis, however, could greatly skew the
results one direction or another. Successful companies recognize the need for fair and responsible ethical
behavior, not just from a moral standpoint, but from a business standpoint, as well.
 Unit-2

Indian ethos for work life

The silent ideas and thoughts of Indian Ethos in Management revealed by Indian’s ancient scriptures are:

1. Atmano Mokshartham Jagat Hitaya Cha: All work is an opportunity for doing well to the
world and thus gaining materially and spiritually in our lives.

2. Archet Dana Manabhyam: Worship people not only with material things but also by showing
respect to their enterprising divinity within.

3. Atmana Vindyate Viryam: Strength and inspiration for excelling in work comes from the
Divine, God within, through prayer, spiritual reading and unselfish work.

4. Yogah Karmashu Kaushalam, Samatvam Yoga Uchyate: He who works with calm and even
mind achieves the most.

5. Yadishi Bhavana Yasya Siddhi Bhavati Tadrishi: As we think, so we succeed, so we become.

Attention to means, ensure the end.

6. Parasparam Bhavatantah Shreyah Param Bhavapsyathah: By mutual cooperation, respect

and fellow felling, all of us enjoy the highest good both material and spiritual.

7. Tesham Sukhm Tesham Shanti Shaswati: Infinite happiness and infinite peace come to them
who see the Divine in all beings.

8. Paraspar Devo Bhava: Regard the other person as a divine being.

All of us have the same consciousness though our packages and containers are different.

Indian ethos is needed due to the following reasons:

1. Maintain Holistic Universe: Modern science has accepted that in this holistic universe, all
minds and matters are interconnected at a deeper level. The basic unity of life cannot be broken.
Love, sacrifice therefore emerges as the only means for a meaningful living. On the basis of this
holistic vision, Indians have developed work ethos of life. This helps in living life to the fullest.

2. Elucidate Motivation: Concept of motivation can be explained holistically by Indian ethos.

Considering motivations as internal, every human being has the same divine atman with immense
potentialities within. Vedanta brings infinite expansions of the mind, breaks down all the barriers
and brings out the God in man. Motivation is to be internal and not external. Such motivation
involves the inner beauty and does not promote any greed in an individual to have more and more
in return for his work.

3. Welfare: Indian ethos teaches welfare of all (yagna spirit). “Atmano Mokharth Jagat Hitay Cha”
(serves your personal interest but do not forget others). This philosophy is needed in modern
times.
 4. Unique Work Culture: Indian ethos helps in development of unique work culture. Work is
considered as duty or Sadhana and there is no difference between Karma(work) and
Dharma(religion). The term Dharma does not indicate any particular religion. Dharma is a duty to
be performed in a given situation. Thus, Dharma is possible through Karma only.

5. Evenness of Mind: Indian ethos helps in evenness of mind. Means are equally important as the
ends. Thus, society acceptable values are to be followed in determining the objectives as well as
in the process of achieving these objectives.

6. Self-development: Integrated human personality of self-developed manager can assure best and

competent management of any enterprise, involving collective works and efforts. The refined or
higher consciousness will adopt holistic attitude. It will bring out the divine in man. It will
achieve perfection or excellence in whatsoever sector of work. One shall achieve peace, harmony
and prosperity within and without, i.e., in the internal world and in the external world
simultaneously.

7. Provides Concentration: Vedanta provides the ways and means of controlling the mind. It helps
to concentrate, increase efficiency, productivity and prosperity. It is not religion of resignation
and retirement. One cannot renounce their action. As the Gita says “You have to be a man of
action, do not run away from your action or Karma but the same should be according to your
Dharma”. The second aspect, is while doing the Karma; do not be tempted by worldly pleasures,
materialism and the results. One has to be man of action, working in a spirit of renunciation.
Renunciation does not mean living a life of isolation or living in a forest. One has to face the
world and should not run away from your action. Do not get attached to anything.

8. Establishes Value System: Many of the present ills are the results of decline in our value system
and loss of character. Forces of fierce competition in the technology driven era of globalisation
have taken a heavy toll of traditional values. People need to re-imbibe the sanatan values of
honesty, integrity, compassion, care and cooperation.

There is again a need to establish conduct, based on truth and non-violence, peace, and harmony. One
needs to promote a secular ethos that entails ‘sarva-dharm-sambhav’. That alone will promote enshrined
in our ancient maxim of ‘Vasudhaiv Kutumbakam’. That will be India’s unique contribution towards
enrichment of content of globalisation which today has its focus only on trade and commerce.

Indian values for the work place

CCSUTHEINTACTONE19 SEP 20191 COMMENT

The most highly engaged employees tend to hail from emerging economies and the least engaged come
from countries in well-established markets. Analysis of the data identified a pattern that the country
where employees live, its culture and the resulting expectations have an impact on how engaged and
satisfied they are with their workplace.

When we talk about Indian workers, there are certain aspects in a workplace that rejuvenate and inspire
them. For instance, given the infrastructure and real estate constraints in growing markets, Indian
organizations need to create a voluminous environment within a smaller space. In much of India, public
transportation can be a nightmare. Thus, a company that wants positive, engaged employees has to worry
about their experience not from the moment they enter the workplace, but from the moment they leave
their homes.

In-house Work-Cafe: 

Every 9 to 5 employee needs a third place to rejuvenate away from work. Unlike many western countries,
we may not have the luxury to choose where we work. While in some parts of the world employees can
go down the street to a coffee shop for a meeting or just to think, the reality in growth markets these
places might be difficult to reach or not an option for a quick break. Organizations are increasingly trying
to provide their employees with access to environments that offer some of the relaxing amenities of
home. 

Migrating desks:

In a majority of Indian organizations, most people have their own assigned workstation, but a good
number of workers spend two to four hours every day working someplace else. What kinds of spaces are
they looking for? Is it as simple as adding some sofas and a barista bar to give people the kind of
workplace they want?

Whether younger or older generations, everyone likes informal spaces and uses them regularly- but for
different reasons. Millennials are more likely to use dining spaces to do focus work while older
generations use these spaces for collaboration and socialization. Organizations are increasingly allowing
workers more control and choice so that they can migrate around their office space. 

9 to 5 Wellbeing:

The most important thing employers in India can do is send a very clear message to their employees that
they care about each person’s overall well-being. Due to the unique histories, traditions and memories,
the newest generation of workers have their own sets of aspirations, expectations, and needs. Whether its
access to natural light, treadmill desks, or an in-house gym, the current and future generation of workers
demand spaces that make them feel rejuvenated.  

Understanding diverse Indian workers and their impact on the workplace is important for any
organization that seeks to succeed in the hugely hot centers of business opportunity. Although there’s
efficiency gained with global real estate standards, it’s also true that workplaces that support distinct
worker needs ensure better productivity and increase the ability to attract and retain the best talent out
there. 

1. Management Attitude: Top management having firm belief in value-oriented holistic

management. Profit is earned through service and satisfaction of all stakeholders – employees,
customers, shareholders and citizens. Fulfillment of social responsibility must be ensured.

2. Humanising the Organisation: Looking at the three aspects of humane organisations, i.e., inter
personal relations, man-machine equation where man is the prime concern and inner management
through mental and spiritual growth of individuals.
 3. Interiorising Management: self management or management by consciousness. When the soul
manages the other four members of the human being, namely, the body, mind, intellect and the
heart, the conflict these four have amongst themselves can be resolved. This is called
management by consciousness. The objective of self-management is to first know and manage
oneself and then manage others.

4. Self-Introspection: Embark upon self-study, self-analysis and self-criticism to locate areas of

friction and disharmony, a self examination of one’s own feelings, thoughts, emotions, sensations
and passions and a desire to reduce and subdue the ego.

5. Brain-Stilling: For rational and enduring decisions, silent mind is a necessity. A perfect

Mounum(calm mind enjoying tranquillity) is necessary. Brain-stilling or meditative silence is the
most reliable method to discover solutions to problems which seem to be difficult to tackle by
reason and intellect, because through this, one can come into contact with the inner mind or
higher consciousness, called Chetana.

6. Stepping-back (for a While): Never decide anything, never speak a word and never throw
yourself into action without stepping-back. The stepping-back from a situation for a while
enables one to control and master a situation.

7. Self-Dynamising Meditation: A dynamic meditation helps in transformation of lower

consciousness into higher consciousness and hence is called transforming meditation. Through
meditation, one reaches a higher level of consciousness with a silent and calm mind, which offers
guidance in the form of intuitions to tackle a multitude of problems. This is called consciousness
approach to management.

Work life balance

CCSUTHEINTACTONE19 SEP 20191 COMMENT

Following are the few basic principles of Indian ethos management:

1. Immense potential, energy and talents for perfection, as a human being has the spirit within his
heart.

2. Holistic approach indicating unity between the Divine (the Divine means perfection in

knowledge, wisdom and power), individual self and the universe.

3. Subtle, intangible subject and gross tangible objects are equally important. One must develop
one’s third eye, Jnana Chakshu, the eye of wisdom, visions, insight and foresight.

4. Inner resources are much more powerful than outer resources. Divine virtues are inner
resources. Capital, materials and plant and machinery are outer resources.

5. Karma yoga (selfless work) offers double benefits, private benefit in the form of self-
purification and public benefit.
 6. Yogah karmasu kaushalam, which means excellence at work through self motivation and self
development with devotion and without attachment.

7. Cooperation is a powerful instrument for team work and success in any enterprise involving
collective work.

Three elements of Indian ethos are as follows:

1. Focus on the permanent: In real life fashions change, concepts change, situations change,
environments change, however, certain things do not change. These are the values of the good,
truth and beautiful. The recent experience in the 90s and the early part of this century shows, that
the world is re-discovering the principle of ‘honesty is the best policy’. After all, honesty is
linked to truth and that is the first principle which perhaps underlines human existence.

In these days, the operational word for integrity is corporate governance. Corporate governance has two
elements. Transparency, which helps to fix accountability, which in turn highlights that accountability, is
for the shareholders and stakeholders. Transparency and accountability are nothing but exercises in
integrity and ensuring that clever financial engineering or window dressing do not mislead the investing
public. If there is a crisis today, whether in the Indian capital market or the U.S. market, it is the crisis of
confidence of the investors in the business enterprises. It is therefore found that one of the central
elements of Indian ethos, namely, the focus on truth and integrity is also eminently relevant in the
business context.

2. Quest for Perfection: It has been immortalised in the shloka:

“Om poornamada poornamidam poornathpurana mudachyate

poornasya poornamadaya poornameva vashistate”

Out of perfection comes perfection. This quest for perfection ultimately, is the quest for quality. When it
comes to quality, the concepts like total quality management, etc., have only once again underlined this
principle of the fact that quality products and services cannot come out of an organisation unless the
principle of quality pervades every function of that organisation. This all pervasive quality is also
reflected in the shloka of Vallabhacharya, who found that every aspect of Lord Krishna was beautiful:

“Adharam madhuram vadhanam madhuram

Nayanam madhuram hasitam madhuram

Hridayam madhuram gamanam madhuram

Madhurathipathe akhilam madhuram”

All pervasive sense of sweetness and elegance is not only the reflection of quality but also of excellence.
In any management today, this ultimate focus on excellence can never be lost. Thus, it is found that this
aspect of Indian ethos is also not only relevant to India but globally.

3. Joy in Performing One’s Function: It was Deming who said that ’quality’ is the pride, which an
artisan takes in his craft. It is the pride which an artist takes in his art. If one is enjoying what one
 is doing, automatically, he is bound to do extremely well; and while excellence becomes a by-
product or a spin of the benefit of happiness, it also leads to success. After all, every excellent
organisation has excellent morale.

Excellence, in terms of enjoyment through doing is the third aspect of Indian ethos. It is found that this
aspect is not only restricted to India, but is universally applicable.

Unit-3

Relationship between Ethics & Corporate Excellence

Life has become one gigantic game. To succeed in this game, we have to struggle. This struggle
is consuming our life silently.

Do not discard success because of the simple reason that the creative process which is installed
in your DNA, has to be allowed to express itself. Creativity has to be encouraged. But in this
process, if you are not alert, your inner joy will be destroyed. Hence, make sure that your
commitment to corporate excellence is based on the foundation of work ethics.

Ethics is not some set of rules based on laws. Ethics is based on goodness. Goodness is not
bound by one’s definition; it is like intelligence; it is free-flowing, but has its intrinsic wisdom.
Ethics is order and action born out of goodness. Goodness in action mode is ethics. It is an
indicator of health to be ethical in an unethical society.

An ethical process is order in motion and hence immensely crucial in the corporate world. An
important aspect of being altruistic is a high degree of integrity. From a spiritual dimension, it is
integrating the physical, emotional, intellectual and spiritual aspects. Abusing the body is
unethical.

Corporate Excellence is defined as the ability of the company to outsmart Competitors

consistently over a long period of time.  In this context, successful organizations are different
from excellent organizations.  Success may be of one dimensions but excellence is of multiple
dimensional in the company. In the ever-changing business environment, the following are the
critical areas that facilitate the company to achieve excellence

(1) BUSINESS PROCESS REENGINERING:

As the business scenario is fast changing day by day, to meet the ever-changing demands of the
market the organizations need to restructure & redesign their Business processes. The BPR
facilities sweeping changes in all the functional areas of the organization.  It reinvents the way
the business is carried out, and ultimately helps the company to engender corporate excellence.
As, striving to become excellent is a continuous process, corporate excellence can’t be a
Destination, it is a journey.

(2) GROWTH – SUSTAINABLE DEVELOPMENT:

The corporate objective of mere growth may just lead to maximization of sales Revenue or
profits, which don’t help the organization to be excellent.  Many organizations are growing at a
rapid speed, but they failed to develop consistently.  Hence the companies need to redefine their
objectives towards sustainable development.

(3) CORE – COMPETENCE:

A unique strength either in technology or in the processing of functional areas, that an

organization enjoys exclusively and which can’t be copied by the competitors is called – Core
Competence. This unique strength helps the company to get competitive advantage over a long
period of time, which in turn facilitates the company to excel.

Core competencies contribute significantly to customer benefits and satisfaction, which is a

primary aim of any business.  Core competencies help the firm in a multifaceted manner.  A
company can achieve competence superiority only by means of core competence, and it will lead
to corporate excellence.

E.g.: Honda has got its core competence in the design and manufacturing of automobile engines.

(4) RESOURCE UTILIZATION:

Excellence in organization can be achieved through proper utilization of the basic Human,
Physical & financial, resources. New and advanced technologies have to be adopted in all the
functional areas like – production, marketing, finance, HRD, of the organization.  Organizations
need to strengthen their Research and Development departments in order to embrace latest
technologies.

(5) E-COMMERCE:

As the competition in business area is growing rapidly the business organizations started
redefining their business activities. According to Fortune Magazine – “Electronic Commerce is
the new industrial order.  It will change the relationship between consumers & Producers.

As Electronic Commerce involves the exchange of products, Services, and information of

payment through the electronic medium of computers & networks, it facilitates the continuum
relation between the company and the customer, which is a pre requisite for a company to excel.

(6) CRM  (CUSTOMER RELATIONSHIP MANAGEMENT):

In the process of achieving corporate excellence in the present day highly competitive market,
the organizations ability to compete depends on its relationship with its target customers.  The
basis for continuity of relation between the company and the customer, over a period & time is
value maximization to customers, which will lead to customer loyalty.  In an attempt to achieve
corporate excellence the organizations should try to develop strong Customer Relationship
Management.
(7) SOCIAL CONSCIOUSNESS:

Organizations can achieve corporate excellence by means of contributing to the well being of the
society.  As the customers are becoming aware of the cause and effect of polluted environment,
all the business firms should have a concern for society, by introducing ecologically friendly
products or services.

Many companies in India are redesigning their business activities, giving importance to society
and are launching Non-Government Organizations.

Example: - Satyam Computers of Hyderabad started Byrraju Foundation, which is    specialized
in the field of rural development. Emergency ambulance services by the name 108 has been a
mega hit in various districts of Andhra Pradesh. 

Dr. Reddy’s Laboratories of Hyderabad floated Dr. Reddy’s Foundation in field of youth welfare
and development.

(8) BUSINESS ETHICS:

In order to achieve excellence, the companies should have basics positive values and attitudes.
Ethics deals with what is wrong and what is right in various disciplines of the organization.
Unethical practices may yield short term gains but organization can’t be successful in the long
run. The organization should develop and formulate the right approaches and strategies to excel.
Because it is to be noted that being right in ethical behavior always pays off.

Besides the above said elements, there are certain areas by which corporate excellence is
facilitated in the modern business world. Young entrepreneurs and business mangers must pay
attention to all these areas in order to see their organization excel

(a) EXCELLENCE THROUGH MANUFACTURING:

In the manufacturing area, a new concept called – World Class Manufacturing ( WCM ) has
emerged recently. The companies adopting WCM are able to introduce the products and services
very much closer to the needs and wants of the costumer. This helps the company to be
successful because WCM has the following characteristics

I) Products of high quality 

II)  Products with enhanced features
III) Products at the right price. 

(b) EXCELLENCE THROUGH MARKETING MIX:

In the ever changing, highly competitive business field new directions have to be shown in order
to strive & ultimately to achieve corporate excellence.
All organizations, irrespective of the product they offer and the service they provide are always
in search of achieving excellence.  The basic area of concern to accomplish corporate excellence
is effective management of Marketing Mix of the company. Innovation in product attributes,
reasoning in prices, wide spread & easy reaches in placing, the right distribution networks,
objective in promotion, are the fields that a firm seeking excellence should concentrate on.

(c) EXCELLENCE THROUGH HRM:

Among all the organizational resources, the human resources are the most vital and require
constant refinement.  Organizational objectives and strategies must match with HR strategies.
Since the change is the fundamental element in achieving corporate excellence, change
management is to be backed by human resources of the firm. The change can be facilitated by
means of HR activity- Training. Hence the training programmes in the new age business
organizations should focus on – Team work, leadership, initiation, interpersonal communication.

(d) EXCELLENCE THROUGH INFORMATION:

In this present networking era, information has become a major resource after physical, financial,
human resources of the organization. Proper management of information is the best way to get
competitive advantage. Computer based information systems help the organization to convert
raw data in to meaningful information, which helps the manger in taking effective decisions,
which in term improve business performance and ultimately lead to corporate excellence.
Information systems like TPS (Transaction Processing System), MIS (Management Information
Systems), DSS (Decision Support Systems), ESS (Executive Support Systems) if used
intelligently helps the organization to reach the pinnacle in the competition.

 Corporate Mission Statement

A good mission statement is useful tool for well-run business. It’s the “why” of business
strategy.

A mission statement defines a company’s goals in three important ways:

 It defines what the company does for its customers

 It defines what the company does for its employees

 It defines what the company does for its owners

Some of the best mission statements also extend themselves to include fourth and fifth
dimensions: what the company does for its community, and for the world.

Developing your company’s first mission statement, or writing a new or revised one, is your
opportunity to define the company’s goals, ethics, culture, and norms for decision-making. The
daily routine of business gets in the way sometimes, and a quick refresh with the mission
statement helps a person take a step back and remember what’s most important: the organization
has a purpose.

Don’t waste your time with a bad mission statement

That a traditional business plan often includes a mission statement isn’t a reason to do one. And
make it useful or don’t bother. The vast majority of the mission statements are just meaningless
hype that could be used to describe any business in the category.

1. Start with a market-defining story

You don’t have to actually write the story—it’s definitely not included in the mission
statement—but do think it through:

Imagine a real person making the actual decision to buy what you sell. Use your imagination to
see why she wants it, how she finds you, and what buying from you does for her. The more
concrete the story, the better. And keep that in mind for the actual mission statement
wording: “The more concrete, the better.”

This isn’t literally part of the mission statement. Rather, it’s an important thing to have in your
head while you write the mission statement. It’s in the background, between the words. If you’re
having trouble getting started, make a quick list of what your company does and doesn’t do.

2. Define what your business does for its customers

Start your mission statement with the good you do. Use your market-defining story to suss out
whatever it is that makes your business special for your target customer.

Don’t undervalue your business: You don’t have to cure cancer or stop global climate change to
be doing good. Offering trustworthy auto repair, for example, narrowed down to your specialty
in your neighborhood with your unique policies, is doing something good. So is offering
excellent slow food in your neighborhood, with emphasis on organic and local, at a price
premium.

This is a part of your mission statement, and a pretty crucial part at that—write it down.

If your business is good for the world, incorporate that here too. But claims about being good for
the world need to be meaningful, and distinguishable from all the other businesses. Add the
words “clean” or “green” if that’s really true and you keep to it rigorously. Don’t just say it,
especially if it isn’t important or always true.

3. Define what your business does for its employees

Good businesses are good for their employees too or they don’t last. Keeping employees is better
for the bottom line than turnover. Company culture matters. Rewarding and motivating people
matters. A mission statement can define what your business offers its employee.

Stating that you value fair compensation, room to grow, training, a healthy, creative work
environment, and respect for diversity is probably a good idea, even if that part of your mission
statement isn’t unique. That’s because the mission statement can serve as a reminder—for
owners, supervisors, and workers—and as a lever for self-enforcement.

While I consulted for Apple Computer, for example, that business differentiated its goals of
training and empowering employees by making a point of bringing in very high-quality
educators and presenters to help employees’ business expertise grow. That was part of the
culture and, to my mind, part of the mission; but it wasn’t part of the mission statement. It could
have been.

American Express, however, includes the team in its mission:

“We have a mission to be the world’s most respected service brand. To do this, we have
established a culture that supports our team members, so they can provide exceptional service
to our customers.”

4. Add what the business does for its owners

In business school they taught us that the mission of management is to enhance the value of the
stock. And shares of stock are ownership. Some would say that it goes without saying that a
business exists to enhance the financial position of its owners, and maybe it does. However, only
a small subset of all businesses are about the business buzzwords of “share value” and “return on
investment.”

However, this element too, as with the suggestion about including employees, is unusual. Few
mission statements do it. That’s understandable, since most mission statements are outward
facing only, aimed at customers and nobody else.

Still, some of the best mission statements incorporate a much broader sense of mission that
includes, or at least implies, the mission of ownership.

Warby Parker, an eyewear company, does a great job at voicing a higher mission that includes
customers, employees, and owners.

“Warby Parker was founded with a rebellious spirit and a lofty objective: to offer designer
eyewear at a revolutionary price, while leading the way for socially-conscious business.”

5. Discuss, digest, cut, polish, review, revise

Whatever you wrote for points two through four above, go back and cut down the wordiness.
Good mission statements serve multiple functions, define objectives, and live for a long time. So,
edit. This step is worth it.

Start by considering developing a full mission statement for internal use and using a customer-
facing subset for general publication. That’s common. Many companies have segmented mission
statements, with sections set aside and categorized by type or goal. Use bullet points or sections
if that works for you. Part of the reason people confuse mission with mantra and vision is that
many businesses use them together, and many others also redefine them to fit their context. So
what a company does for customers is often called vision, despite the formal definition.

Remember, form follows function, in mission statements, as in all business. Make it work for

your business. Or don’t do it at all. If you want to call it a vision, and that works for employees
and customers, then do that.

As you edit, keep a sharp eye out for the buzzwords and hype that everybody claims. Cut as
much as you can that doesn’t apply specifically to your business, except for the occasional
special elements that—unique or not—can serve as long-term rules and reminders. Unique itself,
the word, means literally, the only one in the world. Use it sparingly. Phrases such as “being the
best possible,” “world-class,” and “great customer service” mean little because everybody uses
them. Having great customer service is way harder than writing that into a mission statement.

And, for the rest of your business’s life, review and revise it as needed. As with everything in a
business plan, your mission statement should never get written in stone, and, much less, stashed
in a drawer. Use it or lose it. Review and revise as necessary, because change is constant

Code of ethics, Guidelines for developing code of ethics

Code of ethics

A code of ethics is a guide of principles designed to help professionals conduct business honestly
and with integrity. A code of ethics document may outline the mission and values of the business
or organization, how professionals are supposed to approach problems, the ethical principles
based on the organization’s core values and the standards to which the professional is held. A
code of ethics, also referred to as an “ethical code,” may encompass areas such as business
ethics, a code of professional practice and an employee code of conduct.

Regardless of size, businesses count on their management staff to set a standard of ethical
conduct for other employees to follow. When administrators adhere to the code of ethics, it sends
a message that universal compliance is expected of every employee.

Compliance-Based Code of Ethics

For all businesses, laws regulate issues such as hiring and safety standards. Compliance-based
codes of ethics not only set guidelines for conduct, but also determine penalties for violations.
In some industries, including banking, specific laws govern business conduct. These
industries formulate compliance-based codes of ethics to enforce laws and regulations.
Employees usually undergo formal training to learn the rules of conduct. Because
noncompliance can create legal issues for the company as a whole, individual workers within a
firm may face penalties for failing to follow guidelines.

Value-Based Code of Ethics

A value-based code of ethics addresses a company’s core value system. It may outline standards
of responsible conduct as they relate to the larger public good and the environment. Value-based
ethical codes may require a greater degree of self-regulation than compliance-based codes.

Some codes of conduct contain language that addresses both compliance and values. For
example, a grocery store chain might create a code of conduct that espouses the company’s
commitment to health and safety regulations above financial gain. That grocery chain might also
include a statement about refusing to contract with suppliers that feed hormones to livestock or
raise animals in inhumane living conditions.

Code of Ethics among Professionals

Financial advisers registered with the Securities and Exchange Commission or a state regulator is
bound by a code of ethics known as fiduciary duty. This is a legal requirement and also a code of
loyalty that requires them to act in the best interest of their clients.

Guidelines for developing code of ethics

Development Process

The first step in developing a code of conduct is to establish the purpose of the codes and why
they matter. In a KPMG survey of Fortune Global 200 companies, the three most common
reasons for adopting business codes were to comply with legal requirements, create a shared
company culture, and protect and improve the organization’s reputation. KPMG’s survey also
found that the most commonly cited core values of Fortune Global 200 companies are integrity,
teamwork, respect, innovation, and client focus. Schwartz also recommended that code
provisions should be consistent with “six universal moral values” (trustworthiness, respect,
responsibility, fairness, caring, and citizenship), which should prevail over financial objectives.

To achieve the organization’s risk management standards it is important to draft a code that
clearly states expectations and guidelines for acceptable behavior, and provides options for
seeking advice and for reporting concerns or suspected misconduct. In his research on the many
dimensions of code development, Schwartz found that employees, managers, and ethics officers
consider codes more effective when they are readable, relevant, and have a positive tone.
One of the things the authors found lacking was guidance for employees who are faced with
difficult decisions. The American Management Association proposes using the code of conduct
to guide employees who are conducting business and making decisions in business dealings and
relationships around the globe, by simply recommending that employees ask themselves two
questions:

1. Does this comply with the law, the Code of Conduct and the company’s policies?

2. How would customers, shareholders, general public and co-workers view it?

The best practices for drafting codes of conduct that emerge from these studies include:

 Obtain buy-in across the organization with input from a multidisciplinary team

 Include the organization’s mission statement, vision, and values that reflect its
commitment to ethics, integrity, and quality

 Clarify that the organization expects individuals to act with honesty and integrity in
addition to compliance with legal requirements

 Describe expected behaviors rather than stating prohibitions

 Cover relevant risks, employment practices, protecting corporate assets, and managing
third-party relationships

 Make it user-friendly and applicable to all individuals covered by the code

 Use simple, concise, and easily understood language (and provide translated versions as
needed)

 Describe enforcement and disciplinary procedures

 Solicit feedback on the code from all levels of the organization

 Update to improve content and address new issues or risk areas

But the mere existence of a code of ethics, without more, will not create a sense of shared values
and commitment to ethical behavior.

Implementation

Based on their analysis of the effect that Lehman Brothers’ code of ethics had on its corporate
culture, the authors concluded that “silence can be deadly,” “codes fail when poorly
communicated,” and “codes themselves cannot create ethical organizations.”

In fact, their research found that these two actions are key to code implementation:
  Communicate codes through the right channels and explain why they’re important

 Integrate codes into the organization’s practices and back it up with enforcement

Once drafted, an organization needs to embed the code into its culture. The KPMG report
recommends that the code become a “living” document to guide and create ethical behavior
throughout the organization through:

 Communication and training

 Personnel and other policy measures
 Monitoring, auditing, and reporting
At the companies KPMG surveyed, training courses were commonly used to:
 Explain the importance of the code
 Reinforce ethical behavior
 Strengthen the moral compass
 Identify and deal with dilemmas
 Provide guidance on how to implement the code more effectively
At Lehman Brothers, the ethical code contained the phrase “compete aggressively in furthering
the interests of the firm.” However, the authors raise the question of whether explaining to
employees the level of acceptable risk in “competing aggressively” would have avoided
leveraging the company “into a lethal situation.”
Effective implementation requires ethical leadership and support, training, and continuous
reinforcement and updates to keep the code current. Ongoing administration and reinforcement
of code standards embeds an organization’s values into its culture, which stimulates ethical
reflection and action, and encourages compliance so that employees speak up when they see
others engaging in unethical behavior. And for the skeptics who question whether an effective
code of ethics is worth all this effort, the bottom line is that good ethics are good for business.

 Organizational Culture
Organizational culture can be defined as the group norms, values, beliefs and assumptions
practiced in an organization. It brings stability and control within the firm. The organization is
more stable and its objective can be understood more clearly.

Organizational culture helps the group members to resolve their differences, overcome the
barriers and also helps them in tackling risks.

Elements of Organizational Culture

The two key elements seen in organizational culture are:

 Visible elements: These elements are seen by the outer world. Example, dress code,
activities, setup, etc.
  Invisible elements: These inner elements of the group cannot be seen by people outside
the group or firm. Example, values, norms, assumptions, etc. Now let us discuss some
other elements of organizational culture. They are:

 Stories: Stories regarding the history of the firm, or founder.

 Rituals: Precise practices an organization follows as a habit.

 Symbol: The logo or signature or the style statement of a company.

 Language: A common language that can be followed by all, like English.

 Practice: Discipline, daily routine or say the tight schedule everyone follows without any
failure.

 Values and Norms: The idea over which a company is based or the thought of the firm is
considered as its value and the condition to adopt them are called norms.

 Assumptions: It means we consider something to be true without any facts. Assumptions

can be used as the standard of working, means the employees prepare themselves to
remain above standard.

Different Types of Organizational Culture

The culture a firm follows can be further classified into different types. They are:
 Mechanistic and Organic culture
 Authoritarian and Participative culture
 Subculture and Dominant culture
 Strong and Weak culture
 Entrepreneurial and Market culture
Mechanistic and Organic Culture
Mechanistic culture is formed by formal rule and standard operating procedures. Everything
needs to be defined clearly to the employees like their task, responsibility and concerned
authorities. Communication process is carried according to the direction given by the
organization. Accountability is one of the key factors of mechanistic culture.

Organic culture is defined as the essence of social values in an organization. Thus there exists a
high degree of sociability with very few formal rules and regulations in the company. It has a
systematic hierarchy of authority that leads towards free flow of communication. Some key
elements of organic culture include authority, responsibility, accountability and direct flow
towards the employee.

Authoritarian and Participative Culture

Authoritarian culture means power of one. In this culture, power remains with the top level
management. All the decisions are made by the top management with no employee involvement
in the decision making as well as goal shaping process. The authority demands obedience from
the employee and warns them for punishment in case of mistake or irregularity. This type of
culture is followed by military organization.

Subculture and Dominant Culture

In subculture, some members of the organization make and follow a culture but not all members.
It is a part of organizational culture, thus we can see many subcultures in an organization. Every
department in a company have their own culture that gets converted to a subculture. So, the
strength and adaptability of an organizational culture is dependent on the success of subculture.

Strong and Weak Culture

In a strong culture, the employees are loyal and have a feeling of belongingness towards the
organization. They are proud of their company as well as of the work they do and they slave
towards their goal with proper coordination and control. Perception and commitment are two
aspects that are seen within the employees. In this culture, there is less employee turnover and
high productivity.

Entrepreneurial and Market Culture

Entrepreneurial culture is a flexible and risk-taking culture. Here the employees show their
innovativeness in thinking and are experimental in practice. Individual initiations make the goal
easy to achieve. Employees are given freedom in their activity. The organization rewards the
employees for better performance.

Market culture is based on achievement of goal. It is a highly target-oriented and completely

profit-oriented culture. Here the relationship between the employees and the organization is to
achieve the goal. The social relation among the workers is not motivating.

How to Create an Organizational Culture

An organizational culture is created with the combination of certain criteria that are mentioned
below:

 The founder of the organization may partly set a culture.

 The environment within which the organization standards may influence its activities to
set a culture.

 Sometimes interchange of culture in between different organizations create different new

cultures.
  The members of the organization may set a culture that is flexible to adapt.

 New cultures are also created in an organization due to demand of time and situation.

The culture of an organizational can change due to composition of workforce, merger and
acquisition, planned organizational change, and influence of other organizational culture.

Total Quality Management (TQM)

Total Quality Management (TQM) is the continual process of detecting and reducing or
eliminating errors in manufacturing, streamlining supply chain management, improving the
customer experience, and ensuring that employees are up to speed with their training. Total
quality management aims to hold all parties involved in the production process accountable for
the overall quality of the final product or service.

A total approach to quality is the current thinking of today; which is popularly called total quality
management (TQM).

TQM is a philosophy that believes in a company-wide responsibility toward quality via fostering
a quality culture throughout the organization; involving continuous improvement in the quality
of work of all employees with a view to best meeting the requirements of customers.
Advantages of TQM

(i) Sharpens Competitive Edge of the Enterprise

TQM helps an organization to reduce costs through elimination of waste, rework etc. It increases
profitability and competitiveness of the enterprise; and helps to sharpen the organization’s
competitive edge, in the globalized economy of today.

(ii) Excellent Customer Satisfaction

By focusing on customer requirements, TQM makes for excellent customer satisfaction. This
leads to more and more sales, and excellent relations with customers.

(iii) Improvement in Organizational Performance

Through promoting quality culture in the organization, TQM lead to improvements in

managerial and operative personnel’s performance.

(iv) Good Public Image of the Enterprise

TQM helps to build an image of the enterprise in the minds of people in society. This is due to
stress on total quality system and customers’ requirements, under the philosophy of TQM.

(v) Better Personnel Relations

TQM aims at promoting mutual trust and openness among employees, at all levels in the
organization. This leads to better personnel relations in the enterprise.

Limitations of TQM

The philosophy of TQM suffers from the following major limitations

(i) Waiting for a Long Time

TQM requires significant change in organization; consisting of:

1. Change in methods, processes etc. of organization.

2. Change in attitude, behavior etc. of people

Launching of TQM and acceptance of the philosophy of TQM requires a long waiting for the
organization. It is not possible to accept and implement TQM overnight.

(ii) Problem of Labour Management Relations

Success of TQM depends on the relationships between labour and management; because
participation of people at all levels is a pre-requisite for TQM programme implementation. In
many organizations, here and abroad, labour-management relations are quite tense. As such,
launching, acceptance and implementation of TQM programme is nothing more than a dream for
such organizations.

Basic Principles of TQM

In TQM, the processes and initiatives that produce products or services are thoroughly managed.
By this way of managing, process variations are minimized, so the end product or the service
will have a predictable quality level.

Following are the key principles used in TQM

(i) Top management – The upper management is the driving force behind TQM. The upper
management bears the responsibility of creating an environment to rollout TQM concepts and
practices.

(ii) Training needs – When a TQM rollout is due, all the employees of the company need to go
through a proper cycle of training. Once the TQM implementation starts, the employees should
go through regular trainings and certification process.
(iii) Customer orientation – The quality improvements should ultimately target improving the
customer satisfaction. For this, the company can conduct surveys and feedback forums for
gathering customer satisfaction and feedback information.

(iv) Involvement of employees – Pro-activeness of employees is the main contribution from the
staff. The TQM environment should make sure that the employees who are proactive are
rewarded appropriately.

(v) Techniques and tools – Use of techniques and tools suitable for the company is one of the
main factors of TQM.

(vi) Corporate culture – The corporate culture should be such that it facilitates the employees
with the tools and techniques where the employees can work towards achieving higher quality.

(vii) Continues improvements – TQM implementation is not one time exercise. As long as the
company practices TQM, the TQM process should be improved continuously.