ethics.

ppt (bus1301)
ethics.ppt (bus1301)
4Essence of Ethics
4Morally Questionable Acts
4Dynamic Relationships that Affect
Ethical Decision Making
4Factors Affecting Ethical Decisions
4Norms and Counter-norms
4Managing Ethics
ethics.ppt (bus1301)
TEXACO - racial discrimination $176 M
MERCURY FINANCE - overstating profit $ 2.2 B
ADM - price fixing $100 M
GENETECH - tying personal loan
to business deal CEO loses job
BANKER‟S TRUST - deliberately misled or
deceived customers Damaged image
W.R. GRACE - sexual harassment CEO loses job
BAUSCH & LOMB - manipulation of
accounting data earnings fell 54%
ethics.ppt (bus1301)
1. Responsibility to address corporate
issues (58% Execs)

2. Corp. leaders‟ responsibility is to
the greatest good (52% Execs;
35% MBAs)

3. Switch brands (76% consumers)

4. Skepticism about „cause‟ related
marketing (58% consumers; 21%
today)

5. Do not buy (75% consumers)

58% execs

52% execs
35% MBAs

76% consumers

58% consumers
21% today

75% consumers
ethics.ppt (bus1301)
1. Social responsibility is important
(26% investors)
2. Company image (84% employees)

3. Innovative workplace practices
associated with productivity
4. Employee ownership leads to
productivity (60% companies)
5. Business has too much power (71 %)

6. Corporate role is more than to make
a profit (95%)

1. 26% investors

2. 84% employees



4. 60% companies

5. 71%

6. 95%
ethics.ppt (bus1301)
- Corporate layoffs - theft
- Wall Street sins - selling products that do not meet
specs.
- Pentagon fraud
- age discrimination - retaliation against employees
who exposed unsafe/illegal
practices
- price fixing
- use of banned chemicals
- power in the market place
* Who is responsible? “Captain of the ship?”
* Does profitability excuse questionable behavior?
Profit at Any Cost
ethics.ppt (bus1301)
4Codes do not produce ethical
behavior.

4Our ethics tend to flow from our
core values.

4People have intrinsic worth.
ethics.ppt (bus1301)
Conflicts of interest lead to ethical problems

Individual behavior is strongly influenced by
incentive

Self-regulation and standard setting
organizations fall short
ethics.ppt (bus1301)
4Get support by CEO for support of key
stakeholders
4Get stakeholders participation
4Expand words/ phrases into expectations
4Establish feedback mechanism
4Assure implementation/ monitoring of
results
4Reward employees who perform and
deliver on values
ethics.ppt (bus1301)
4Non-job failures:
– Cheating on your expense accounts
– Stealing supplies
– Sandbagging

4Job failures:
– Superficial performance appraisal
– Not confronting expense account
– Cheaters
– Falsely praising poor performers
– Denial of training opportunities
– Undermine management
ethics.ppt (bus1301)
4Job distortions:
– Bribery
– Manipulation of suppliers/buyers
– Differential pricing
– Falsifying information

4Job “creation”:
– Bending policies for certain customers
– Bending policies for salespeople
– Caught violating rules
– Arranging for promotions
ethics.ppt (bus1301)
FACTORS AFFECTING
ETHICAL DECISIONS
UNCERTAINTY
OF
INPUTS
CENTRALITY
OF
WORKFLOW
SUBSTITUTABILITY
OF
ACTIVITIES
PREVENTIVE
ROUTINIZATION
COPING
ROUTINIZATION
POWER
CONTROL OF
ETHICAL
CONTINGENCIES
BEHAVIOR
ethics.ppt (bus1301)
A General Framework of the
Ethical Decision-Making Process
ETHICAL
SITUATION
CHARACTERISTICS OF
THE DECISION MAKER
SIGNIFICANT
INFLUENCES

OUTCOMES

DECISION
ethics.ppt (bus1301)
Individual Characteristics of the
Decision Maker that Influence the
Ethical Decision-Making Process
ETHICAL
SITUATION
CHARACTERISTICS OF
THE DECISION MAKER
SIGNIFICANT INFLUENCES

OUTCOMES

DECISION

* Achievement motivation * Knowledge
* Need for affiliation * Experience
* Ego strength * Risk taking
* Locus of control * Machiavellianism
ethics.ppt (bus1301)
Outcomes that Result from the
Ethical Decision-Making Process
ETHICAL
SITUATION
CHARACTERISTICS OF
THE DECISION MAKER
SIGNIFICANT INFLUENCES

OUTCOMES

DECISION

* Performance * Feedback
* Rewards * Promotions
* Satisfaction * Learning

ethics.ppt (bus1301)
Significant Influences on the Ethical
Decision-Making Process
ETHICAL
SITUATION
CHARACTERISTICS OF
THE DECISION MAKER
SIGNIFICANT INFLUENCES

OUTCOMES

DECISION

* The organization * Technology
* Work * Significant others; customers,
* The law peers, immediate supervisor,
* Economics top managers, family, friends,
* Professionalism other “opinion leaders”
ethics.ppt (bus1301)
Elements of the Ethical Situation
ETHICAL
SITUATION
CHARACTERISTICS OF
THE DECISION MAKER
SIGNIFICANT INFLUENCES

OUTCOMES

DECISION

* Opportunity
* Ethical decision history
* Moral intensity of the situation
Elements of the Ethical
Decision-Making Process
Characteristics of
Decision Makers
Significant
Influences
Outcomes

PERCEIVED ETHICAL
PROBLEM

PERCEIVED
ALTERNATIVES,
PRODUCT, PRICE,
PROMOTION,
DISTRIBUTION INFO

PERCEIVED
CONSQUENCES

ELEMENTS OF THE DECISION

Information acquired
Information processed


Ethical decision history
Expectations
Sent and received roles
Ethics norms (personal &
those of others)

Information acquired
Information processed


Probability of consequences
Desirability of consequences


JUDGMENT

DECISION
Ethical
Situation
ethics.ppt (bus1301)
ORGANIZATION A
ORGANIZATION B
ethics.ppt (bus1301)
NORMS
4 LT relationships with
customers
4 Objectivity
4 Openness
4 Candor
4 Honesty
4 Flexibility/Adaptability
4 Cost-effectiveness
4 Taking responsibility
4 Customer Service
4 Develop younger salespeople
4 Team effort
4 Consensus
4 Loyalty
COUNTERNORMS
4 Sandbagging

4 Emotional Involvement
4 Secrecy
4 Stonewalling
4 Lying
4 Dogmatism
4 Padding expenses
4 Passing the buck
4 Sales force
4 Look out for “Number 1”
4 Individual goals first
4 Taking unfair credit
4 Criticize the company
ethics.ppt (bus1301)
4The OLD Ethic Favors
Work
Savings
Responsibility
Competition
Sex roles
Sacrifice
Equality - Inequality
Wealth accumulation
Absolution
Risk assumption
Efficiency/Productivity
Thrift/Investment
4The NEW Ethic Favors
Leisure
Debt
Rights
Protection
Unisexism
Self-interest
Equality
Wealth redistribution
Situationalism
Risk aversion
Quality of life
Consumerism
ethics.ppt (bus1301)
4Diagnose the reward system
4Analyze rules and procedures
4Training and education
4Develop investigative structures
ethics.ppt (bus1301)
4Leaders exhibit moral courage by being
willing to make personal sacrifices

4Leaders should not become to
preoccupied with pleasing constituents

4Leaders focus on needs of others - they
have a commitment to serve

4Business as usual may be evidence of a
leadership failure
ethics.ppt (bus1301)
4Determination and a winning personality
equal success
4Employees rarely complain
4Employees take their cues from
management
4Top management actions are more
important than codes of ethics
4Employees wrestle with the short-run
vs. long-run
CEO‟S Set the Tone for How to Handle
Questions of Ethics
(Hymowitz)
ethics.ppt (bus1301)
THE ESSENCE OF ETHICS I
(Article by Williams)
4Codes of ethics do not necessarily lead
to ethical behavior.
4The core values we profess are not
necessarily those by which we live.
4There is a place for compassion in
leadership.
4Bureaucracy can come in conflict with
ethics.
4Managers who vent their frustration on
subordinates (who can do little about it)
are not acting ethically.
ethics.ppt (bus1301)
THE ESSENCE OF ETHICS II
(Article by Williams)
4Study the ethics of organizations which
have reputations for being ethical.

4Build ethics into organization policies
and practices.

4Make sure quality and service and
integrity permeate the entire
organization.

4Develop high expectations of all
members of your organization.
ethics.ppt (bus1301)
THE ESSENCE OF ETHICS II
(Article by Williams)
4Create an organizational culture that


6encourages...…
6open and honest communication
6continual learning
6personal development
6respect for people
ethics.ppt (bus1301)
Background
Slides
You will be Responsible for this Material!
ethics.ppt (bus1301)
Company Threats to Ethical Behavior
4A firm that…
routinely ignores or violates internal codes of
ethics
always looks for simple solutions to ethical
problems and is satisfied with “quick fixes”
unwilling to take an ethical stand when there is
financial cost to the decision
creates an internal environment that either
encourages unethical behavior or discourages
ethical behavior
usually sends its ethical problems to the legal
department
looks at ethics solely as a public relations tool to
enhance its image
ethics.ppt (bus1301)
Company Threats to Ethical Behavior
4A firm that…
treats its employees differently from its customers
is unfair or arbitrary in its performance appraisal
standards
has no procedures or policies for handling ethical
problems
provides no mechanisms for internal whistle-
blowing
lacks clear lines of communication within the
organization
is sensitive only to the needs of shareholders
encourages its employees to leave their personal
ethical values at the door
ethics.ppt (bus1301)
FIVE WARNING SIGNS OF ETHICAL COLLAPSE
(Jennings article)
4surround yourself with subordinates who are
young, inexperienced, enthralled with power
and deep in debt
4send a clear message that you expect results
at any cost
4be certain the CEO is tyrannical and prone to
anger
4when an employee‟s public statements bring
criticism to the company, cut the employee
loose
4when an ethical lapse is discovered, never
admit anything. Conceal, spin and gloss.
ethics.ppt (bus1301)
Do College Honor Codes Make Moral Sense on
Today’s Campus?
(Brownfield)
Information on College Students
[ 70% have cheated on a test at least once
[ 87% have cheated on some type of written work
[ 49% have collaborated with others on an assignment
[ 52% have copied from someone
[ 87% business majors have cheated at least once

Conclusion: grade > learning short-run > long-run
chaos > standards negligence > integrity
laziness > diligence
ethics.ppt (bus1301)
Is an Honor Code a reasonable ideal for
Today‟s students???
Today, we have a…
[Questionable moral climate,
[Lack of strong, value-based up-bringing, and
[Celebration of negative role models
Do College Honor Codes Make Moral Sense on
Today’s Campus?
(Brownfield)
ethics.ppt (bus1301)
Can we arrive at consistency in global
ethics standards?
– Companies are identified by their corruption
– Who will want to partner with such
companies?
ethics.ppt (bus1301)
PR vs. Performance

Real transformations require a change in core
values, attitudes, relationships, leadership with
experience for change

Sound organizations provide freedom to act, but
also have some controls

A culture built around “star players” cannot foster
teamwork
ethics.ppt (bus1301)
Chapter #5 - Conducting Business
Ethically and Responsible
4Companies must be
committed to ethics
¬Codes
¬Ethics Programs
¬Ethics Orientation

4Social
Responsibility
¬Not the same as
ethics
¬Related to ethics
4Company
Responsibilities
¬Customers
¬Employees
¬Investors
¬Others
ethics.ppt (bus1301)
Chapter #5 - Conducting Business
Ethically and Responsible
4Can businesses that conduct
themselves in an ethical way be
profitable?

4How can ethical behavior be
encouraged?

4What do short-term and long-
term thinking have to do with
ethics?
ethics.ppt (bus1301)
You Will be Responsible for
this Material on the TEST
ethics.ppt (bus1301)
ACTIONS ADVANTAGES DISADVANTAGES

Alternative Courses of Action
Available in Ethical Situations
4NOT THINK
ABOUT IT


4GO ALONG &
GET ALONG



4PROTEST
Avoids the danger of
getting into a zero-sum
game with colleagues


Same as “not think
about it”




Individual feels good
about making effort to
stop unethical
behavior



The risk of going in the
wrong direction

Same as “not to think
about it”
Individuals slowly
conform… maybe to the
wrong direction

Organization disregards
protest & punishes
protester
ethics.ppt (bus1301)
ACTIONS ADVANTAGES DISADVANTAGES

Alternative Courses of Action
Available in Ethical Situations
4CONSCIENTIOUSLY
OBJECT




4 LEAVE
Makes clear statement
that one person feels
that action is unethical

Person feels good
about self for making
effort to stop unethical
behavior

Signals that
organization will lose
good people if unethical
behavior continues

Person who leaves may
join a competitor, feels
better because he/she
did not cooperate with
unethical behavior

Few organizations
recognize individual
rights to object
May hurt chances for
rewards and
advancement

Most people are
replaceable and if
replacement
cooperates with
unethical behavior,
what is gained?
ethics.ppt (bus1301)
ACTIONS ADVANTAGES DISADVANTAGES
Alternative Courses of Action
Available in Ethical Situations

4SECRETLY BLOW
THE WHISTLE



4PUBLICLY BLOW
THE WHISTLE

4SECRETLY
THREATEN TO
BLOW THE
WHISTLE
Can be very effective

If whistle-blower
remains secret,
retaliation cannot
occur

Can be effective

Whistle-blower may
be treated as a hero
by many


Can be very effective

When it works,
organization is not
hurt by bad publicity

- Feelings of cowardice
- Creation of atmosphere of
mistrust
- What will whistle-blower do
if confronted by firm - tell the
truth or lie?

- Organization may attack the
whistle-blower
- It is difficult to interact with
those one is criticizing
- It may be difficult to work
with those who hold a
grudge

- Does not permit dialogue
between upper&lower
managers
- Might prevent injured
consumers or clients from
receiving remedies

ethics.ppt (bus1301)
ACTIONS ADVANTAGES DISADVANTAGES

Alternative Courses of Action
Available in Ethical Situations
4SABOTAGE





4NEGOTIATE




Can be effective

Identity of saboteur
might be protected






Individual action may
lead to small-group
consensus that will be
more effective than
individual action

Win-win solutions are
possible
Sabotage is not dialogue
Retaliation might occur
against the saboteur or
against others
Innocent people may be
fired

Does not work well in
situations that are zero-
sum, lose-win, in nature
Individual who perceives
ethical problem may not
know how to negotiate, my
lose “cool”
SELECTED PRINCIPLES OF
ETHICAL CONDUCT
4 KANT‟S CATEGORICAL IMPERATIVE: Act in a
way that you believe is right and just for any other
person in a similar situation.

4 CARR‟S CONVENTIONALIST ETHIC: Bluff and
take advantage of all legal opportunities and
widespread practices and customs

4 THE DISCLOSURE RULE: Ask how it would feel to
see the thinking and details of the decision
disclosed to a wide audience

4 THE GOLDEN RULE: Look at the problem from
the position of another party affected by the
decision and try to determine what response the
other person would expect as the most virtuous
SELECTED PRINCIPLES OF
ETHICAL CONDUCT
4 THE HEDONISTIC ETHIC: Do whatever you find to be
in your own self-interest

4 MOORE‟S INTUITION ETHIC: Go with your “gut”
feeling or what you understand to be right in a given
situation

4 SMITH‟S MARKET ETHIC: Take selfish actions and be
motivated by personal gains in business dealings

4 MACHIAVELLI‟S MEANS-END ETHIC: Ask whether
some overall good justifies any moral transgression

4 NIETZSCHE/MARX MIGHT-EQUALS-RIGHT ETHIC:
Seize what advantage you are strong enough to use
without respect to ordinary social conventions and
laws
SELECTED PRINCIPLES OF
ETHICAL CONDUCT
4 THE ORGANIZATION ETHIC: Ask whether actions
are consistent with organizational goals and do what
is good for the organization

4 GARRETT‟S PRINCIPLE OF PROPORTIONALITY: Do
whatever you will if there is a proportional reason for
doing so

4 THE PROTESTANT ETHIC: Do only that which can
be explained before a committee of your peers

4 THE REVELATION ETHIC: Pray, mediate, or
otherwise commune with a superior force or being

4 BENTHAM / MILL‟S UTILITARIAN ETHIC: Determine
whether the harm in an action is outweighed by the
good
MORAL TYPES DESCRIPTORS
´ Hedontist


Profit-
maximizer


Socialite

1. Make physical pleasures the supreme goal in
their lives.
4 KEY QUESTION: Which course of action will
yield the greatest pleasure?

2. Goal of making as much money as possible
4 KEY QUESTION: which course of action will
make the most money?
4 All their feelings and associations can be
melted down to dollars

3. A social butterfly, a party animal
4 KEY QUESTION: Which course of action will
help me best get along with the group?
4 If you want to know what this person thinks,
find out who spoke to him or her most
recently
MORAL TYPES DESCRIPTORS
4. Life centers around power and glory.
4 KEY QUESTION: Which course of action will
increase my power and glory?
4 These people have enormous egos, boundless
ambitions, and undertake reckless actions.

5. Spiritual values predominate
4 KEY QUESTION: which course of action will
help me become a better person?
4 These people have new insights, reform old
ways, initiate new ways of thinking, strike out
on new paths

6. A technician
4 POSITIVES: Creative, knowledgeable,
independent, self-reliant, hardworking
4 NEGATIVES: Sadistic, forceful, manipulative,
non-trustworthy
Politician



Self-
actualizer


Craftsman
MORAL TYPES DESCRIPTORS
7. Main goal in life to belong to an organization
4 POSITIVES: Service oriented, loyal,
responsible, humble, sensitive to the needs
of others, dependable, pleasant, trustworthy
4 NEGATIVES: Fear, worry, dependency,
lacking vision, risk aversive, low drive,
indecisive, change resistant

8. Dominant goal in life to gain prestige, glory,
fame
4 POSITIVES: Inventive, flexible, change
oriented, competitive, team player,
independent, risk taker, impartial, high
energy, idealistic
4 NEGATIVES: Lack of conviction, rebellious,
manipulative, lack of intimacy, lonely
Company
person



Gamesman

ethics.ppt (bus1301)
PERSONAL MORAL
DEVELOPMENT
1. Physical consequences
determine moral
behavior. Avoidance of
punishment and
deference to power are
typical of this stage

2. Individual pleasure
needs are the primary
concern and dictate
attitudes toward
behavior

ORGANIZATIONAL MORAL
DEVELOPMENT
1. Social Darwinism - Fear of
extinction and the urgency
of financial survival dictate
moral conduct. The direct
use of force is the
acceptable norm.

2. Machiavellianism -
Organizational gain guides
actions. Successfully
attaining goals justifies the
use of any effective means,
including individual
manipulation
Models of Personal and
Organizational Moral Development

PERSONAL MORAL ORGANIZATIONAL MORAL
DEVELOPMENT DEVELOPMENT

ethics.ppt (bus1301)
PERSONAL MORAL
DEVELOPMENT
3. The approval of others
determines behavior.
The good person is one
who satisfies family,
friends, associates.


4. Compliance with
authority, upholding of
the social order, and
“doing one‟s duty” are
primary concerns

ORGANIZATIONAL MORAL
DEVELOPMENT
3. Cultural conformity - A
tradition of standard
operating procedures and
caring groups. Peer
professional pressure to
adhere to social norms
dictates what is the right and
wrong behavior

Allegiance to authority-

Directions from legal authority
determine moral standards.
Right and wrong are based on
the decisions of those with
legitimate hierarchical power
Models of Personal and
Organizational Moral Development

PERSONAL MORAL ORGANIZATIONAL MORAL
DEVELOPMENT DEVELOPMENT

ethics.ppt (bus1301)
ORGANIZATIONAL MORAL
DEVELOPMENT
5. Democratic participation -
Participation in decision-making
reliance on majority rule become
organizational moral standards.
Participative management
becomes institutionalized


Organizational integrity-
Justice and individual rights
are the moral ideals. Balanced
judgment between competing
interests shapes organizational
character which, in turn,
determines the validity of the
behavior
PERSONAL MORAL
DEVELOPMENT
5. Tolerance for rational
dissent and acceptance
of majority rule become
primary ethical concerns

6. What is right and good is
a matter of individual
conscience and
responsibly chosen
commitment. Morality is
based on principled
personal convictions

Models of Personal and
Organizational Moral Development

PERSONAL MORAL ORGANIZATIONAL MORAL
DEVELOPMENT DEVELOPMENT

of Ethics  Morally Questionable Acts  Dynamic Relationships that Affect Ethical Decision Making  Factors Affecting Ethical Decisions  Norms and Counter-norms  Managing Ethics
ethics.ppt (bus1301)

 Essence

TEXACO racial discrimination $176 M MERCURY FINANCE - overstating profit $ 2.2 B ADM price fixing $100 M GENETECH tying personal loan to business deal CEO loses job BANKER‟S TRUST - deliberately misled or deceived customers Damaged image W.R. GRACE sexual harassment CEO loses job BAUSCH & LOMB manipulation of accounting data earnings fell 54%

ethics.ppt (bus1301)

1. Responsibility to address corporate issues (58% Execs) 2. Corp. leaders‟ responsibility is to the greatest good (52% Execs; 35% MBAs) 3. Switch brands (76% consumers) 4. Skepticism about „cause‟ related marketing (58% consumers; 21% today) 5. Do not buy (75% consumers)

58% execs 52% execs 35% MBAs 76% consumers 58% consumers 21% today

75% consumers

ethics.ppt (bus1301)

1. Social responsibility is important (26% investors) 2. Company image (84% employees) 3. Innovative workplace practices associated with productivity 4. Employee ownership leads to productivity (60% companies) 5. Business has too much power (71 %)

1. 26% investors 2. 84% employees

4. 60% companies 5. 71%

6. Corporate role is more than to make a profit (95%)

6. 95%

ethics.ppt (bus1301)

age discrimination .Wall Street sins .use of banned chemicals .Pentagon fraud .price fixing .power in the market place * Who is responsible? “Captain of the ship?” * Does profitability excuse questionable behavior? ethics. .Profit at Any Cost .Corporate layoffs .retaliation against employees who exposed unsafe/illegal practices .ppt (bus1301) .selling products that do not meet specs.theft .

Our People ethics. have intrinsic worth.Codes do not produce ethical behavior. ethics tend to flow from our core values.ppt (bus1301) .

ppt (bus1301) .Conflicts of interest lead to ethical problems Individual behavior is strongly influenced by incentive Self-regulation and standard setting organizations fall short ethics.

ppt (bus1301) . Get support by CEO for support of key stakeholders  Get stakeholders participation  Expand words/ phrases into expectations  Establish feedback mechanism  Assure implementation/ monitoring of results  Reward employees who perform and deliver on values ethics.

Non-job failures: – Cheating on your expense accounts – Stealing supplies – Sandbagging Job failures: – Superficial performance appraisal – Not confronting expense account – Cheaters – Falsely praising poor performers – Denial of training opportunities – Undermine management ethics.ppt (bus1301) .

Job distortions: – Bribery – Manipulation of suppliers/buyers – Differential pricing – Falsifying information Job “creation”: – Bending policies for certain customers – Bending policies for salespeople – Caught violating rules – Arranging for promotions ethics.ppt (bus1301) .

ppt (bus1301) .FACTORS AFFECTING ETHICAL DECISIONS UNCERTAINTY OF INPUTS CENTRALITY OF WORKFLOW POWER CONTROL OF ETHICAL CONTINGENCIES BEHAVIOR SUBSTITUTABILITY OF ACTIVITIES PREVENTIVE ROUTINIZATION COPING ROUTINIZATION ethics.

ppt (bus1301) .A General Framework of the Ethical Decision-Making Process CHARACTERISTICS OF THE DECISION MAKER ETHICAL SITUATION DECISION OUTCOMES SIGNIFICANT INFLUENCES ethics.

Individual Characteristics of the Decision Maker that Influence the Ethical Decision-Making Process CHARACTERISTICS OF THE DECISION MAKER ETHICAL SITUATION DECISION SIGNIFICANT INFLUENCES OUTCOMES * Achievement motivation * Need for affiliation * Ego strength * Locus of control ethics.ppt (bus1301) * Knowledge * Experience * Risk taking * Machiavellianism .

Outcomes that Result from the Ethical Decision-Making Process CHARACTERISTICS OF THE DECISION MAKER ETHICAL SITUATION DECISION SIGNIFICANT INFLUENCES OUTCOMES * Performance * Rewards * Satisfaction ethics.ppt (bus1301) * Feedback * Promotions * Learning .

customers. immediate supervisor. peers. family.Significant Influences on the Ethical Decision-Making Process CHARACTERISTICS OF THE DECISION MAKER ETHICAL SITUATION DECISION SIGNIFICANT INFLUENCES OUTCOMES * The organization * Work * The law * Economics * Professionalism ethics. friends.ppt (bus1301) * Technology * Significant others. top managers. other “opinion leaders” .

Elements of the Ethical Situation CHARACTERISTICS OF THE DECISION MAKER ETHICAL SITUATION DECISION SIGNIFICANT INFLUENCES OUTCOMES * Opportunity * Ethical decision history * Moral intensity of the situation ethics.ppt (bus1301) .

PRICE.Elements of the Ethical Decision-Making Process ELEMENTS OF THE DECISION Characteristics of Decision Makers Ethical Situation DECISION Significant Influences Outcomes PERCEIVED ETHICAL PROBLEM Information acquired Information processed Ethical decision history Expectations Sent and received roles Ethics norms (personal & those of others) PERCEIVED ALTERNATIVES. DISTRIBUTION INFO JUDGMENT Information acquired Information processed PERCEIVED CONSQUENCES Probability of consequences Desirability of consequences . PRODUCT. PROMOTION.

ORGANIZATION A ORGANIZATION B ethics.ppt (bus1301) .

NORMS      COUNTERNORMS                   LT relationships with customers Objectivity Openness Candor Honesty Flexibility/Adaptability Cost-effectiveness Taking responsibility Customer Service Develop younger salespeople Team effort Consensus Loyalty Sandbagging Emotional Involvement Secrecy Stonewalling Lying Dogmatism Padding expenses Passing the buck Sales force Look out for “Number 1” Individual goals first Taking unfair credit Criticize the company    ethics.ppt (bus1301) .

ppt (bus1301)  The NEW Ethic Favors Leisure Debt Rights Protection Unisexism Self-interest Equality Wealth redistribution Situationalism Risk aversion Quality of life Consumerism .Inequality Wealth accumulation Absolution Risk assumption Efficiency/Productivity Thrift/Investment ethics. The OLD Ethic Favors Work Savings Responsibility Competition Sex roles Sacrifice Equality .

ppt (bus1301) .Diagnose Analyze the reward system rules and procedures and education Training Develop investigative structures ethics.

ppt (bus1301) . Leaders exhibit moral courage by being willing to make personal sacrifices should not become to preoccupied with pleasing constituents focus on needs of others .they have a commitment to serve as usual may be evidence of a leadership failure  Leaders  Leaders  Business ethics.

CEO‟S Set the Tone for How to Handle Questions of Ethics (Hymowitz)  Determination and a winning personality equal success  Employees rarely complain  Employees take their cues from management  Top management actions are more important than codes of ethics  Employees wrestle with the short-run vs.ppt (bus1301) . long-run ethics.

ppt (bus1301) .  Managers who vent their frustration on subordinates (who can do little about it) are not acting ethically.  Bureaucracy can come in conflict with ethics. ethics.  There is a place for compassion in leadership.  The core values we profess are not necessarily those by which we live.THE ESSENCE OF ETHICS I (Article by Williams)  Codes of ethics do not necessarily lead to ethical behavior.

 Build  Make  Develop ethics.THE ESSENCE OF ETHICS II (Article by Williams)  Study the ethics of organizations which have reputations for being ethical. high expectations of all members of your organization. ethics into organization policies and practices.ppt (bus1301) . sure quality and service and integrity permeate the entire organization.

…  open and honest communication  continual learning  personal development for people  respect ethics.THE ESSENCE OF ETHICS II (Article by Williams) Create an organizational culture that  encourages.ppt (bus1301) ...

Background Slides You will be Responsible for this Material! ethics.ppt (bus1301) .

ppt (bus1301) .Company Threats to Ethical Behavior A firm that…  routinely ignores or violates internal codes of ethics  always looks for simple solutions to ethical problems and is satisfied with “quick fixes”  unwilling to take an ethical stand when there is financial cost to the decision  creates an internal environment that either encourages unethical behavior or discourages ethical behavior  usually sends its ethical problems to the legal department  looks at ethics solely as a public relations tool to enhance its image ethics.

ppt (bus1301) .Company Threats to Ethical Behavior A firm that…  treats its employees differently from its customers  is unfair or arbitrary in its performance appraisal standards  has no procedures or policies for handling ethical problems  provides no mechanisms for internal whistleblowing  lacks clear lines of communication within the organization  is sensitive only to the needs of shareholders  encourages its employees to leave their personal ethical values at the door ethics.

spin and gloss.ppt (bus1301) . ethics. Conceal. never admit anything. inexperienced. cut the employee loose  when an ethical lapse is discovered.FIVE WARNING SIGNS OF ETHICAL COLLAPSE (Jennings article)  surround yourself with subordinates who are young. enthralled with power and deep in debt  send a clear message that you expect results at any cost  be certain the CEO is tyrannical and prone to anger  when an employee‟s public statements bring criticism to the company.

Do College Honor Codes Make Moral Sense on Today’s Campus? (Brownfield) Information on College Students      70% have cheated on a test at least once 87% have cheated on some type of written work 49% have collaborated with others on an assignment 52% have copied from someone 87% business majors have cheated at least once Conclusion: grade > learning chaos > standards laziness > diligence ethics.ppt (bus1301) short-run > long-run negligence > integrity .

ppt (bus1301) . we have a…  Questionable moral climate.  Lack of strong. value-based up-bringing. and  Celebration of negative role models ethics.Do College Honor Codes Make Moral Sense on Today’s Campus? (Brownfield) Is an Honor Code a reasonable ideal for Today‟s students??? Today.

Can we arrive at consistency in global ethics standards? – Companies are identified by their corruption – Who will want to partner with such companies? ethics.ppt (bus1301) .

attitudes. relationships.ppt (bus1301) . but also have some controls A culture built around “star players” cannot foster teamwork ethics.PR vs. Performance Real transformations require a change in core values. leadership with experience for change Sound organizations provide freedom to act.

Chapter #5 .ppt (bus1301) .Conducting Business Ethically and Responsible Companies must be committed to ethics Codes Ethics Programs Ethics Orientation Company Responsibilities Customers Employees Investors Others Social Responsibility Not the same as ethics Related to ethics ethics.

ppt (bus1301) .Conducting Business Ethically and Responsible Can businesses that conduct themselves in an ethical way be profitable? can ethical behavior be encouraged? do short-term and longterm thinking have to do with ethics? How What ethics.Chapter #5 .

ppt (bus1301) .You Will be Responsible for this Material on the TEST ethics.

ppt (bus1301) .Alternative Courses of Action Available in Ethical Situations ACTIONS NOT THINK ADVANTAGES Avoids the danger of getting into a zero-sum game with colleagues Same as “not think about it” DISADVANTAGES The risk of going in the wrong direction Same as “not to think about it” Individuals slowly conform… maybe to the wrong direction Organization disregards protest & punishes protester ABOUT IT GO ALONG & GET ALONG PROTEST Individual feels good about making effort to stop unethical behavior ethics.

Alternative Courses of Action Available in Ethical Situations ACTIONS CONSCIENTIOUSLY ADVANTAGES Makes clear statement that one person feels that action is unethical Person feels good about self for making effort to stop unethical behavior Signals that organization will lose good people if unethical behavior continues Person who leaves may join a competitor. feels better because he/she did not cooperate with unethical behavior DISADVANTAGES Few organizations recognize individual rights to object May hurt chances for rewards and advancement Most people are replaceable and if replacement cooperates with unethical behavior. what is gained? OBJECT  LEAVE ethics.ppt (bus1301) .

ppt (bus1301) Can be very effective When it works.Creation of atmosphere of mistrust .Organization may attack the whistle-blower .What will whistle-blower do if confronted by firm .Might prevent injured consumers or clients from receiving remedies THE WHISTLE PUBLICLY BLOW THE WHISTLE SECRETLY THREATEN TO BLOW THE WHISTLE ethics. organization is not hurt by bad publicity .Alternative Courses of Action Available in Ethical Situations ACTIONS SECRETLY BLOW ADVANTAGES Can be very effective If whistle-blower remains secret.Does not permit dialogue between upper&lower managers .Feelings of cowardice . retaliation cannot occur Can be effective Whistle-blower may be treated as a hero by many DISADVANTAGES .It may be difficult to work with those who hold a grudge .It is difficult to interact with those one is criticizing .tell the truth or lie? .

Alternative Courses of Action Available in Ethical Situations ACTIONS SABOTAGE ADVANTAGES Can be effective Identity of saboteur might be protected DISADVANTAGES Sabotage is not dialogue Retaliation might occur against the saboteur or against others Innocent people may be fired NEGOTIATE Individual action may lead to small-group consensus that will be more effective than individual action Win-win solutions are possible Does not work well in situations that are zerosum.ppt (bus1301) . in nature Individual who perceives ethical problem may not know how to negotiate. lose-win. my lose “cool” ethics.

CARR‟S CONVENTIONALIST ETHIC: Bluff and take advantage of all legal opportunities and widespread practices and customs THE DISCLOSURE RULE: Ask how it would feel to see the thinking and details of the decision disclosed to a wide audience THE GOLDEN RULE: Look at the problem from the position of another party affected by the decision and try to determine what response the other person would expect as the most virtuous    .SELECTED PRINCIPLES OF ETHICAL CONDUCT  KANT‟S CATEGORICAL IMPERATIVE: Act in a way that you believe is right and just for any other person in a similar situation.

SELECTED PRINCIPLES OF ETHICAL CONDUCT   THE HEDONISTIC ETHIC: Do whatever you find to be in your own self-interest MOORE‟S INTUITION ETHIC: Go with your “gut” feeling or what you understand to be right in a given situation SMITH‟S MARKET ETHIC: Take selfish actions and be motivated by personal gains in business dealings MACHIAVELLI‟S MEANS-END ETHIC: Ask whether some overall good justifies any moral transgression NIETZSCHE/MARX MIGHT-EQUALS-RIGHT ETHIC: Seize what advantage you are strong enough to use without respect to ordinary social conventions and laws    .

mediate. or otherwise commune with a superior force or being BENTHAM / MILL‟S UTILITARIAN ETHIC: Determine whether the harm in an action is outweighed by the good .SELECTED PRINCIPLES OF ETHICAL CONDUCT  THE ORGANIZATION ETHIC: Ask whether actions are consistent with organizational goals and do what is good for the organization GARRETT‟S PRINCIPLE OF PROPORTIONALITY: Do whatever you will if there is a proportional reason for doing so THE PROTESTANT ETHIC: Do only that which can be explained before a committee of your peers     THE REVELATION ETHIC: Pray.

Make physical pleasures the supreme goal in their lives. find out who spoke to him or her most recently .MORAL TYPES  Hedontist DESCRIPTORS 1. a party animal  KEY QUESTION: Which course of action will help me best get along with the group?  If you want to know what this person thinks.  KEY QUESTION: Which course of action will yield the greatest pleasure? 2. A social butterfly. Goal of making as much money as possible  KEY QUESTION: which course of action will make the most money?  All their feelings and associations can be melted down to dollars  Profit- maximizer  Socialite 3.

5. reform old ways. non-trustworthy  Self- actualizer  Craftsman .  KEY QUESTION: Which course of action will increase my power and glory?  These people have enormous egos.MORAL TYPES  Politician DESCRIPTORS 4. Spiritual values predominate  KEY QUESTION: which course of action will help me become a better person?  These people have new insights. strike out on new paths 6. forceful. initiate new ways of thinking. independent. self-reliant. boundless ambitions. Life centers around power and glory. knowledgeable. manipulative. and undertake reckless actions. hardworking  NEGATIVES: Sadistic. A technician  POSITIVES: Creative.

independent. team player. dependency. risk aversive. competitive. idealistic  NEGATIVES: Lack of conviction. Main goal in life to belong to an organization  POSITIVES: Service oriented. change resistant 8. humble. manipulative. lack of intimacy. responsible. high energy. rebellious. trustworthy  NEGATIVES: Fear. glory. fame  POSITIVES: Inventive. change oriented. risk taker. indecisive. sensitive to the needs of others. impartial. lonely person  Gamesman . flexible. lacking vision. Dominant goal in life to gain prestige. pleasant. loyal. worry. low drive.MORAL TYPES  Company DESCRIPTORS 7. dependable.

Avoidance of punishment and deference to power are typical of this stage 2. Individual pleasure needs are the primary concern and dictate attitudes toward behavior ORGANIZATIONAL MORAL ORGANIZATIONAL MORAL DEVELOPMENT DEVELOPMENT 1.ppt (bus1301) . Machiavellianism Organizational gain guides actions.Fear of extinction and the urgency of financial survival dictate moral conduct.Models of Personal and Organizational Moral Development PERSONAL MORAL PERSONAL MORAL DEVELOPMENT DEVELOPMENT 1. including individual manipulation ethics. Social Darwinism . 2. Physical consequences determine moral behavior. The direct use of force is the acceptable norm. Successfully attaining goals justifies the use of any effective means.

The approval of others 3. adhere to social norms dictates what is the right and wrong behavior 4. upholding of Directions from legal authority the social order. and determine moral standards. Right and wrong are based on “doing one‟s duty” are the decisions of those with primary concerns legitimate hierarchical power ethics. Peer who satisfies family. professional pressure to friends.ppt (bus1301) . Compliance with Allegiance to authorityauthority.Models of Personal and Organizational Moral Development PERSONAL MORAL PERSONAL MORAL DEVELOPMENT ORGANIZATIONAL MORAL DEVELOPMENT ORGANIZATIONAL MORAL DEVELOPMENT DEVELOPMENT 3.A tradition of standard determines behavior. operating procedures and The good person is one caring groups. Cultural conformity . associates.

Democratic participation Participation in decision-making dissent and acceptance reliance on majority rule become of majority rule become organizational moral standards. primary ethical concerns Participative management becomes institutionalized 6. Balanced judgment between competing interests shapes organizational character which. What is right and good is a matter of individual conscience and responsibly chosen commitment. determines the validity of the behavior . Tolerance for rational 5. in turn.Models of Personal and Organizational Moral Development PERSONAL MORAL ORGANIZATIONAL MORAL DEVELOPMENT DEVELOPMENT PERSONAL MORAL ORGANIZATIONAL MORAL DEVELOPMENT DEVELOPMENT 5. Morality is based on principled personal convictions ethics.ppt (bus1301) Organizational integrityJustice and individual rights are the moral ideals.

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