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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethical and UnethicalWorkplace Behavior
Ethics
The set of moral principles or valuesthat defines right and wrong for aperson or group.
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics and theNature of Management Jobs
Unethical Managerial Behavior
Unethical Managerial Behavior
Authority and Power
Authority and Power
Handling Information
Handling Information
Influencing the Behavior of Others
Influencing the Behavior of Others
Setting Goals
Setting Goals1
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics and theNature of Management Jobs
Managers can encourage ethical behaviors by
using resources for company business only
handling information confidentiallynot influencing others to engage inunethical behavior
not creating policies that reward employees
for unethical behavior setting reasonable goals
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Workplace Deviance
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Workplace Deviance
Unethical behavior that violatesorganizational norms aboutright and wrong
Two dimensions
Degree of devianceTarget of deviant behavior
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Types of Workplace Deviance
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2Adapted from Exhibit 4.1
ProductionDeviance
ProductionDeviance
PropertyDeviance
PropertyDeviance
Political
Deviance
Political
Deviance
Personal
Aggression
Personal
Aggression
Minor Serious
Organizational
Interpersonal
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Production Deviance
Leaving earlyTaking excessive breaksIntentionally working slow
Wasting resources
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Property Deviance
SabotagingequipmentAcceptingkickbacksLying abouthours workedStealing fromcompany
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Political Deviance
Showing favoritismGossiping aboutcoworkers
Blaming coworkersCompeting nonbeneficially
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Personal Aggression
Sexual harassmentVerbal abuseStealing from coworkers
Endangering coworkers
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
U.S. SentencingCommission Guidelines
Companies can be prosecuted and punishedeven if management didnt know about
the unethical behavior.
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Who, What, and Why?
Nearly all businesses are covered
Punishes a number of offenses
Encourages businesses to be proactive
3.13.1
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Partial List of Offenses
3.13.1
Invasion of privacyPrice fixingFraudCustoms violationsAntitrust violationsCivil rights violationsTheft
Money launderingConflicts of interestEmbezzlementDealing in stolen goodsCopyright infringementsExtortionand more
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Steps in determining fine size
1. determine the base fine
2. compute a culpability score
3. multiply the base fine by theculpability score
Steps in determining fine size
1. determine the base fine
2. compute a culpability score3. multiply the base fine by the
culpability score
Compliance Program Steps
Smaller fines for companiesthat are proactive
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Compliance Program Steps
Adapted from Exhibit 4.3
1. Establish standards and procedures.
7. Improve program a fter violations .
6. Enforce standards consistently and fairly.
5. Train employees on standards and procedures.
3. Delegate decision-making authority onlyto ethical employees.
4. Encourage employees to report violations.
2. Assign upper-level managers to be in charge.
3.23.2
Reviseifrequired
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Influences on Ethical Decision Making
EthicalEthicalAnswersAnswersDependDepend
onon
Ethical Intensity of DecisionEthical Intensity of Decision
Moral Development of Manager Moral Development of Manager
Ethical Principles UsedEthical Principles Used
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethical Intensity Depends on
Concentration of effectConcentration of effect
Magnitude of consequencesMagnitude of consequences
Social consensusSocial consensus
Probability of effectProbability of effect
Proximity of effectProximity of effect
Temporal immediacyTemporal immediacy
4.14.1
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Moral Development
4.24.2Adapted from Exhibit 4.4
SocietalSocietalExpectationsExpectationsSelfish
Selfish InternalizedInternalizedPrinciplesPrinciples
PreconventionalPreconventional ConventionalConventional PostconventionalPostconventional
Kohlbergs Stages of Moral Development
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Stages of Moral Development
PreconventionalPreconventional
1. Punishment andObedience
2. InstrumentalExchange
ConventionalConventional
3. Good boy,nice girl
4. Law and order
PostconventionalPostconventional
5. Social contract
6. Universalprinciple
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
Long-term self-interestLong-term self-interest
Personal virtuePersonal virtue
Religious injunctionsReligious injunctions
Government requirementsGovernment requirements
Utilitarian benefitsUtilitarian benefits
Individual rightsIndividual rights
Distributive justiceDistributive justice4.34.3
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Principle of long-term self-interest
Never take any action not in your organizations long-term self-interest.
4.34.3
Principles of Ethical Decision Making
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P i i l f
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
Principle of Government Requirements
Never take any action that violates the law,
for the law represents the minimalmoral standard.
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P i i l f
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
Principle of Utilitarian Benefit
Never take any action that does not result ingreater good for society.
4.34.3
P i i l f
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
Principle of Individual Rights
Never take any action that infringes onothers agreed-upon rights.
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P i i l f
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
Principle of Distributive Justice
Never take any action that harms theleast among us:
the poor, the uneducated,the unemployed.
4.34.3
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P ti l St t
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Practical Steps toEthical Decision Making
Overt Integrity TestsPersonality-Based Integrity Tests
Select and hire ethical employeesSelect and hire ethical employees
If you found a wallet containing $50,would you return it with the money?
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Doing the Right Thing
If You Cheat in College,Will You Cheat in the Workplace?
College students who cheat are likely to cheat again.
70 percent of students dont see cheating as a problem.
People who cheat and cheat again see their behavior as normal.
60 percent of people who cheat their employersdont feel guilty for doing so.
If You Cheat in College,Will You Cheat in the Workplace?
College students who cheat are likely to cheat again.
70 percent of students dont see cheating as a problem.
People who cheat and cheat again see their behavior as normal.
60 percent of people who cheat their employersdont feel guilty for doing so.
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
What Really Works
Studies show that Integrity Tests
Help reduce workplace deviance
Help hire workers who are better performers
However they have a smaller effect
on assessing theft.
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics Question
What is?
What are your personal ethics?
What are your organizations ethics?
What are the ethics of your industry?
What are societys ethics?
What are global ethics?
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics Question
How do we get from What is to What oughtto be?
What is our Motivation?
Practical Steps to
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Practical Steps toEthical Decision Making
Establish a Code of EthicsEstablish a Code of Ethics
Communicate code of ethics to both insideand outside the company
Develop ethical standards and proceduresspecific to business
5.25.2http://www.nortelnetworks.comWeb Link
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A Basic Model of
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
A Basic Model of Ethical Decision Making
1. Identify the problem1. Identify the problem
2. Identify the constituents2. Identify the constituents
3. Diagnose the situation3. Diagnose the situation
4. Analyze your options4. Analyze your options
5. Make your choice5. Make your choice
6. Act6. Act
Adapted from Exhibit 4.6
5.35.3
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethical Climate
Managers:
1. Act ethically2. Are active in company ethics programs3. Report potential ethics violations4. Punish those who violate the code of ethics
Establishing an Ethical ClimateEstablishing an Ethical Climate
5.45.4http://www.whistleblowers.orgWeb Link
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
What Is Social Responsibility?
Social Responsibility
A businesss obligation topursue policies
make decisionstake actions that benefit society
To Whom Are Organizations
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
To Whom Are OrganizationsSocially Responsible?
Stakeholder Model
Stakeholder Model
Satisfy Interestsof Multiple Stakeholders
Satisfy Interestsof Multiple Stakeholders
Shareholder Model
Shareholder Model Maximize ProfitsMaximize Profits
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
ProsPros
Shareholder Model
Firm maximizesshareholder wealth andsatisfaction
The company stockincreases in value
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ConsCons
Organizations cannot acteffectively as moral agentsfor shareholders
Time, money, and attentiondiverted to social causesundermine market efficiency
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Stakeholder Model
Primary Stakeholders:
ShareholdersEmployeesCustomersSuppliers
GovernmentsLocal Communities
Secondary Stakeholders:
MediaSpecial Interest Groups
Trade Associations
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Organizations Social Responsibilities
Abide by principlesAbide by principles
of right and wrongof right and wrong
Obey laws andObey laws andregulationsregulations
EthicalEthical
LegalLegal
EconomicEconomic
DiscretionaryDiscretionary
Be profitableBe profitable
Serve a social roleServe a social role
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$
?
Responses to Demands
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Chapter 4Copyright 2007 by South-Western, a division of Thomson Learning. All rights reserved
Responses to Demandsfor Social Responsibility
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ReactiveReactive DefensiveDefensive Accommo-dativeAccommo-
dative ProactiveProactive
Fight all
the way
DONOTHING
DOMUCH
Withdrawal
Do only what
is required
LegalApproach Bargaining
ProblemSolving
PublicRelationsApproach
Be
progressive
Lead the
industry
Social Responsibility and
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Social Responsibility andEconomic Performance
Realities of SocialResponsibility
Can cost a companyCan cost a company
Sometimes it does paySometimes it does pay
Does not guaranteeprofitability
Does not guaranteeprofitability
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