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Transcript of Chapter 4 Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved...
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethical and Unethical Workplace Behavior
1
Ethics
The set of moral principles or values that defines right and wrong for a person or group.
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics and the Nature of Management Jobs
2
Unethical Managerial BehaviorUnethical Managerial Behavior
Authority and PowerAuthority and Power
Handling InformationHandling Information
Influencing the Behavior of OthersInfluencing the Behavior of Others
Setting GoalsSetting Goals
11
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics and the Nature of Management Jobs
Managers can encourage ethical behaviors by…
– using resources for company business only– handling information confidentially– not influencing others to engage in
unethical behavior– not creating policies that reward employees
for unethical behavior– setting reasonable goals
3
11
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Workplace Deviance
4
22
Workplace Deviance
Unethical behavior that violates organizational norms about right and wrong
Two dimensions Degree of deviance Target of deviant behavior
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Types of Workplace Deviance
5
22Adapted from Exhibit 4.1
Production Deviance
Production Deviance
Property DevianceProperty Deviance
Political DeviancePolitical Deviance
Personal AggressionPersonal
Aggression
Minor Serious
Organizational
Interpersonal
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Production Deviance
• Leaving early• Taking excessive breaks• Intentionally working slow• Wasting resources
6
22
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Property Deviance
• Sabotaging equipment
• Accepting kickbacks• Lying about hours
worked• Stealing from
company
7
22
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Political Deviance
• Showing favoritism• Gossiping about coworkers• Blaming coworkers• Competing nonbeneficially
8
22
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Personal Aggression
• Sexual harassment• Verbal abuse• Stealing from coworkers• Endangering coworkers
9
22
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U.S. Sentencing Commission Guidelines
Companies can be prosecuted and punished even if management didn’t know about
the unethical behavior.
10
33
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Who, What, and Why?
• Nearly all businesses are covered
• Punishes a number of offenses
• Encourages businesses to be proactive
11
3.13.1
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Partial List of Offenses
Invasion of privacyPrice fixingFraudCustoms violationsAntitrust violationsCivil rights violationsTheft
12
3.13.1
Money laundering
Conflicts of interest
Embezzlement
Dealing in stolen goods
Copyright infringements
Extortion
…and more
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Compliance Program Steps
Smaller fines for companies that are
proactive
13
Steps in determining fine size
1. determine the base fine
2. compute a culpability score
3. multiply the base fine by the culpability score
Steps in determining fine size
1. determine the base fine
2. compute a culpability score
3. multiply the base fine by the culpability score
3.23.2
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Compliance Program Steps
14Adapted from Exhibit 4.3
1. Establish standards and procedures.
7. Improve program after violations.
6. Enforce standards consistently and fairly.
5. Train employees on standards and procedures.
3. Delegate decision-making authority only to ethical employees.
4. Encourage employees to report violations.
2. Assign upper-level managers to be in charge.
3.23.2
Revise if required
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Influences on Ethical Decision Making
15
EthicalAnswersDepend
on…
EthicalAnswersDepend
on…
Ethical Intensity of DecisionEthical Intensity of Decision
Moral Development of ManagerMoral Development of Manager
Ethical Principles UsedEthical Principles Used
44
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethical Intensity Depends on…
16
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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Moral Development
17
4.24.2Adapted from Exhibit 4.4
Societal Expectations
SelfishInternalizedPrinciples
PreconventionalPreconventional ConventionalConventional PostconventionalPostconventional
Kohlberg’s Stages of Moral Development
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Stages of Moral Development
18
PreconventionalPreconventional
1. Punishment andObedience
2. InstrumentalExchange
1. Punishment andObedience
2. InstrumentalExchange
ConventionalConventional
3. Good boy, nice girl
4. Law and order
3. Good boy, nice girl
4. Law and order
PostconventionalPostconventional
5. Social contract
6. Universalprinciple
5. Social contract
6. Universalprinciple
4.24.2
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
19
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
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
20
Principle of long-term self-interestPrinciple of long-term self-interest
Never take any action not in your organization’s long-term self-interest.
Never take any action not in your organization’s long-term self-interest.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
21
Principle of Personal VirtuePrinciple of Personal Virtue
Never do anything that is not honest, open, and truthful and that you would not beglad to see reported in the newspapers
or on TV.
Never do anything that is not honest, open, and truthful and that you would not beglad to see reported in the newspapers
or on TV.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
22
Principle of Religious InjunctionsPrinciple of Religious Injunctions
Never take any action that is not kindand that does not build a
sense of community.
Never take any action that is not kindand that does not build a
sense of community.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
23
Principle of Government RequirementsPrinciple of Government Requirements
Never take any action that violates the law,for the law represents the minimal
moral standard.
Never take any action that violates the law,for the law represents the minimal
moral standard.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
24
Principle of Utilitarian BenefitPrinciple of Utilitarian Benefit
Never take any action that does not result ingreater good for society.
Never take any action that does not result ingreater good for society.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
25
Principle of Individual RightsPrinciple of Individual Rights
Never take any action that infringes on others’ agreed-upon rights.
Never take any action that infringes on others’ agreed-upon rights.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Principles of Ethical Decision Making
26
Principle of Distributive JusticePrinciple of Distributive Justice
Never take any action that harms the least among us:
the poor, the uneducated,the unemployed.
Never take any action that harms the least among us:
the poor, the uneducated,the unemployed.
4.34.3
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Practical Steps to Ethical Decision Making
27
Select and hire ethical employeesSelect and hire ethical employees
Establish a Code of EthicsEstablish a Code of Ethics
Train employees to make ethical decisionsTrain employees to make ethical decisions
Create an ethical climateCreate an ethical climate
55
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Practical Steps to Ethical Decision Making
• Overt Integrity Tests• Personality-Based Integrity Tests
28
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
29
If You Cheat in College, Will You Cheat in the Workplace?
College students who cheat are likely to cheat again.
70 percent of students don’t see cheating as a problem.
People who cheat and cheat again see their behavior as normal.
60 percent of people who cheat their employers don’t 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 don’t see cheating as a problem.
People who cheat and cheat again see their behavior as normal.
60 percent of people who cheat their employers don’t feel guilty for doing so.
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
What Really Works
30
Studies show that Integrity Tests…
Help reduce workplace deviance Help hire workers who are better performers
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.
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 organization’s ethics?
• What are the ethics of your industry?
• What are society’s ethics?
• What are global ethics?
31
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics Question
• What ought to be?
• How ought we treat our aging employees?• How safe ought we make this product?• How clean an environment should we aim for?• How should we treat long-term employees
when downsizing?
32
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 ought to be?
• What is our Motivation?
33
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Practical Steps to Ethical Decision Making
• Communicate code of ethics to both inside and outside the company
• Develop ethical standards and proceduresspecific to business
34
Establish a Code of EthicsEstablish a Code of Ethics
5.25.2 http://www.nortelnetworks.comWeb Link
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Ethics Training
• Develops employee awareness of ethics
• Achieves credibility with employees
• Teaches a practical model of ethical decision making
35
Ethics TrainingEthics Training
5.35.3http://ethics.bellsouth.com“Ethics Scenarios Game”
Web Link
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
A Basic Model of Ethical Decision Making
36
1. Identify the problem1. Identify the problem
2. Identify the constituents2. Identify the constituents
3. Diagnose the situation3. Diagnose the situation
4. Analyze your options 4. Analyze your options
5. Make your choice5. Make your choice
6. Act6. Act
Adapted from Exhibit 4.6
5.35.3
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
37
Establishing an Ethical ClimateEstablishing an Ethical Climate
5.45.4 http://www.whistleblowers.orgWeb Link
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
What Is Social Responsibility?
38
Social Responsibility
A business’s obligation to… pursue policies make decisions take actions that benefit society
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
To Whom Are Organizations Socially Responsible?
39
StakeholderModel
StakeholderModel
Satisfy Interests of Multiple Stakeholders
Satisfy Interests of Multiple Stakeholders
ShareholderModel
ShareholderModel Maximize ProfitsMaximize Profits
66
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Shareholder Model
• Firm maximizes shareholder wealth and satisfaction
• The company stock increases in value
40
ProsPros
66
ConsCons
Organizations cannot act effectively as moral agents for shareholders
Time, money, and attention diverted to social causes undermine market efficiency
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Stakeholder Model
41
Primary Stakeholders:
ShareholdersEmployeesCustomersSuppliers
GovernmentsLocal Communities
Primary Stakeholders:
ShareholdersEmployeesCustomersSuppliers
GovernmentsLocal Communities
Secondary Stakeholders:
MediaSpecial Interest Groups
Trade Associations
Secondary Stakeholders:
MediaSpecial Interest Groups
Trade Associations
66
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Organization’s Social Responsibilities
42
Abide by principlesof right and wrong
Obey laws andregulations
Ethical
Legal
Economic
Discretionary
Be profitable
Serve a social role
77
$
?
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Responses to Demands for Social Responsibility
43
88
ReactiveReactive DefensiveDefensive Accommo-dative
Accommo-dative ProactiveProactive
Fight all the way
DO NOTHING
DO MUCH
Withdrawal
Do only what is required
Legal Approach
BargainingProblemSolving
PublicRelationsApproach
Beprogressive
Lead theindustry
Chapter 4Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Social Responsibility and Economic Performance
44
Realities ofSocial
Responsibility
Can cost a companyCan cost a company
Sometimes it does paySometimes it does pay
Does not guarantee profitability
Does not guarantee profitability
99