Ferrell7e Student Ch07
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Ferrell7e Student Ch07






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Ferrell7e Student Ch07 Ferrell7e Student Ch07 Presentation Transcript

    • O.C. Ferrell
      • University of New Mexico
    • John Fraedrich
      • University of Wyoming
    • Linda Ferrell
      • University of New Mexico
    Business Ethics Ethical Decision Making and Cases, Seventh Edition For in-class note taking, choose Handouts or Notes Pages from the print options, with three slides per page.
  • Chapter 7 Organizational Factors: The Role of Ethical Culture and Relationships
  • Corporate Culture
    • Values
    • Beliefs
    • Goals
    • Norms
    • Groups
    • Corporate history
    • Founder
  • Corporate Culture
    • A set of values, beliefs, goals, norms, and rituals that members or employees of an organization share.
    • A company’s history and unwritten rules are a part of its culture.
    • An organization’s failure to monitor or manage its culture may result in unethical behavior.
  • Two Basic Dimensions Determine an Organization’s Culture
    • Concern for people—the organization’s efforts to care for its employees’ well-being
    • Concern for performance—the organization’s efforts to focus on output and employee productivity
  • Ethical Framework and Audit
    • Caring
    • Apathetic
    • Exacting
    • Integrative
  • Organizational Culture Ethics Audit
    • Does the culture reward unethical behavior?
    • Does the organization hire people with values perceived as unethical?
    • Is the company’s objective to make as much profit as possible?
  • Role of Leadership
    • To guide and direct others toward the achievement of a goal
    • To motivate others and enforce organizational rules and policies
    • To influence the corporate culture and ethical posture of the organization (rewards and punishment)
  • Interpersonal Relationships
    • One of the biggest challenges in business is getting diverse people to work together efficiently and ethically while coordinating their skills.
    • Relationships among individuals and within groups are an important part of the proper functioning of a business organization.
  • Interpersonal Relationships in Organizations
    • Corporation as a moral agent
    • Variation in employee conduct
    • Role relationships
    • Significant others
    • Differential association
    • Whistle-blowing
  • Interpersonal Relationships in Organizations
    • Organizational pressures
      • Opportunity and conflict
      • Conflict resolution
    • How to improve ethical decision making
  • Corporation as a Moral Agent
    • Organizations can be held accountable for the conduct of their employees and for all business decisions and outcomes.
    • The organization is responsible to society for its collective decisions and actions.
    • Organizations must be responsible for the correctness of all policies.
  • Variation of Employee Conduct
    • 10% of employees follow their own values and beliefs
    • 40% try to follow company rules and policies
    • 40% go along with the work group
    • 10% take advantage of the situation if the penalty is low and risk of being caught is low
  • Role Relationships
    • Total of all relationships in which a person is involved because of his or her position in the organization (role)
    • Peers and top managers are the most influential factors in organizational ethical decision making
  • Differential Association
    • The idea that people learn ethical or unethical behavior while interacting with others who are part of their role-set or other intimate personal groups
    • Association with those who are unethical, combined with the opportunity to act unethically, is a major influence on ethical decision making
  • Whistle-Blowing
    • Exposing an employer’s wrongdoing to outsiders, such as the media or government regulatory agencies
    • Whistle-blowers often receive negative performance appraisals, become organizational ‘outcasts,’ and lose their jobs
    • Companies often establish internal whistle-blower reporting mechanisms
  • Organizational Pressures
    • Time
    • Middle managers
    • Pressure to perform
    • Pressure to increase profits
    • Top managers
    • Low level managers
  • Opportunity and Conflict Create Ethical Dilemmas
    • Opportunity is the set of conditions that limits unfavorable behavior or rewards favorable behavior
    • A person who behaves unethically and is rewarded (or not punished) is likely to continue to act unethically
  • Conflict Resolution
    • Personal-organizational
    • Personal-societal
    • Organizational-societal
  • Role of Motivation
    • To focus employees’ behavior toward goal achievement within the organization
    • To understand an individual’s hierarchy of needs and how they influence motivation and ethical behavior
  • Centralized Organizations
    • Decision making is concentrated at the upper management levels
    • Works well in high-risk industries with fewer skilled lower-level employees
    • Ethical issues: very little upward communication, less understanding of the interrelatedness of functions, and transferring blame to those who are not responsible
  • Decentralized Organizations
    • Decision making is delegated as far down the chain of command as possible.
    • Control and coordination are relatively informal and personal, and the organization is adaptable and sensitive to external changes.
    • Employees are empowered to make decisions; therefore decentralized organizations tend to have fewer formalized ethics programs and policies.
  • Group Influence on Organizational Culture
    • Formal groups
      • Committees
      • Work groups, teams, quality circles
    • Informal groups