Williams 4e Chapter 04

8/8/2019 Williams 4e Chapter 04

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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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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

1


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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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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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Types of Workplace Deviance

2

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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Production Deviance

Leaving earlyTaking excessive breaksIntentionally working slow

Wasting resources

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2


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Property Deviance

SabotagingequipmentAcceptingkickbacksLying abouthours workedStealing fromcompany

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Political Deviance

Showing favoritismGossiping aboutcoworkers

Blaming coworkersCompeting nonbeneficially

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Personal Aggression

Sexual harassmentVerbal abuseStealing from coworkers

Endangering coworkers

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U.S. SentencingCommission Guidelines

Companies can be prosecuted and punishedeven if management didnt know about

the unethical behavior.

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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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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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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

3.23.2


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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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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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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

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Moral Development

4.24.2Adapted from Exhibit 4.4

SocietalSocietalExpectationsExpectationsSelfish

Selfish InternalizedInternalizedPrinciplesPrinciples

PreconventionalPreconventional ConventionalConventional PostconventionalPostconventional

Kohlbergs Stages of Moral Development


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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

4.24.2

l f


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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

l f


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Principle of long-term self-interest

Never take any action not in your organizations long-term self-interest.

4.34.3



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P i i l f


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Principle of Government Requirements

Never take any action that violates the law,

for the law represents the minimalmoral standard.

4.34.3

P i i l f


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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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Principle of Individual Rights

Never take any action that infringes onothers agreed-upon rights.

4.34.3

P i i l f


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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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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?

5.15.1


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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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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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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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Ethics Question

How do we get from What is to What oughtto be?

What is our Motivation?

Practical Steps to


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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
http://www.nortelnetworks.com/http://www.nortelnetworks.com/


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A Basic Model of


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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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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
http://www.whistleblowers.org/http://www.whistleblowers.org/


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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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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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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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Stakeholder Model

Primary Stakeholders:

ShareholdersEmployeesCustomersSuppliers

GovernmentsLocal Communities

Secondary Stakeholders:

MediaSpecial Interest Groups

Trade Associations

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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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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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Williams 4e Chapter 04

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