Metacognition – thinking about how you see the situation?? what was my process? anything I would do different next time all becomes part of how you are and how you percieve situations next time
Week 3 ethical decision making
1. How do we make good ethical decisions?2. Where do we go wrong when we make an ethical decision improperly?3. Who are managers and businesses responsible to?
Step 1: Determine the facts Step 5: Compare and weight the alternatives Step 2: Identify the ethical issue(s) involved You should be able to explain, defend, and justify your decision to the entire range of stakeholders involved as Step 3: Identify and consider all something that reflects on who you are of the people affected by a and that you are willing to stand behind decision (“stakeholders”) Step 6: Make a decision Step 4: Consider the available alternatives Step 7: Monitor and learn from the outcomes
1. Ignorance (though one can be negligent or reckless in one’s 5. The path of least resistance ignorance, and one can also may make it easier to do the choose to be ignorant) wrong thing2. Failure to consider non-obvious 6. A lack of courage to do what’s alternatives right and deal with the consequences3. Using oversimplified decision rules that are inappropriate in 7. Peer pressure / organizational more complex circumstances culture distorts our moral perception or reasoning4. Settling for an option people can live with, even if it’s not the best option.
Sales Expense:The purchasing manager for alarge company agrees to give youan order (their first), expectingyou agree to make a $200donation to his favorite charity, alocal youth sports team.How do you respond? - Jim Balassone (208)
Certain contextual factors tend to bias our moral intuitions1. social consensus – the degree of 4. probability of effect – a joint of social agreement that about the function of the probability that the moral value (e.g. evil) of a act in question will actually take place and that it will actually cause proposed act. the harms/benefits predicted2. magnitude of consequences – 5. temporal immediacy – the length of the sum of the benefits/harms time between the present and the done to victims/beneficiaries of onset of consequences of the moral the moral act in question. act in question. 6. proximity – the feeling of nearness3. concentration of effect – how (social, cultural, psychological, or spread out or concentrated are physical) that the moral agent has the harms/benefits of the for the victims/beneficiaries of the proposed action. evil/good act in question. - Jones, 1991
Law Organizational policies and norms Professional duties Culture situation context person AWARENESS BALANCE COURAGE • issues • Ideals • intention to act• stakeholders • Obligations • skillful action • stakes • Utilities • options
Issue intensity LawObedience to authority OrganizationalPeer pressure policies and normsSlippery slopes Professional dutiesSunk costs Culture situation context metacognition Character Affective state person learning AWARENESS BALANCE COURAGE • issues • Ideals • intention to act • stakeholders • Obligations • skillful action • stakes • Utilities • options
Once in a lifetime trip to the Himalayas. Travel a well used trail Found a half naked holy man in the snow Do you take him back to a village? Do you care for him? (Both options would cause you to loose the opportunity to make your once in a life time climb.) by Bowen H. McCoy
The Parable of the Sadhu QUESTIONS RAISED AUTHOR’S OBSERVATIONS Is no single person responsible Organizations without a history of when there is a group? mutually accepted shared values tend to come apart during stress. Do we make decisions based on ethnic considerations? People in touch with core values can deal with change, ambiguity, Can a superordinate goal allow for stress, and tough times. moral slippage? People tend avoid the ambiguous Is their an institutional or group yet that is what tends to be the ethic strong than an individual most rewarding ethic? Individuals need organizational How much effort is enough to support to act morally. satisfy your moral obligation? - Jerry Estenson
What is a business? What are its aims andobligations?
Shareholder view A shareholder mission statement: Capitalism is primarily a Coca-Cola: system of competition We exist to create value for our Businesses should be share owners on a long term basis by building a business that managed solely for the enhances the Coca-Cola benefit of shareholders company’s trademark. This is also our ultimate commitment. Executive benefit often tied to shareholder benefit
1. Not practical in today’s world1. Legally out of date1. Unethical
“Business is a set of relationships among groups whichhave a stake in the activities that make up thebusiness. Business is about how customers, suppliersemployees, financiers, communities and managersinteract and create value. To understand a business isto know how these relationships work. And theexecutive’s or entrepreneur’s job is to manage andshape these relationships…” - Edward Freeman
Stakeholder view Zappos’ Core Values statement: Capitalism is primarily a 1. Deliver WOW Through Service system of social cooperation 2. Embrace and Drive Change and collaboration 3. Create Fun and A Little Weirdness 4. Be Adventurous, Creative, and Open-Minded Primary responsibility of 5. Pursue Growth and Learning executive – create as uch 6. Build Open and Honest value for stakeholders as Relationships With possible Communication 7. Build a Positive Team and Family No stakeholder interest is Spirit viable in isolation of the other 8. Do More With Less stakeholders. 9. Be Passionate and Determined 10. Be Humble
Their stake: stocks, bonds, equity, etc. Expectations: • Return On Investment (ROI) • Other expectations?
Their stake: • jobs, livelihood, career, human capital investments Their expectation: • decent wages, security, benefits and meaningful work
Their stake: • need products and services Their expectation: • quality products, fair pricing, and honest dealings.
Their stake: • need income from their goods and services Their expectation: • Expect to be treated fairly and honestly in a mutually prosperous relationship
Their stake: • the environment, taxes, payroll, infrastructure improvements Their expectation: • Provides company with local resources and in return expects the firm to be a good citizen
Shareholder view • Do whatever will maximize shareholder interest The stakeholder view • Treat all stakeholders equally? • If not how do you decide which stakeholder interest gets priority when stakeholder interests conflict? Milton Friedman
“Where stakeholder interestsconflict, the executive must find away to rethink he problems so thatthese interests can go together, sohave to be made, as often happensin the real world, then the executivemust figure out how to make thetradeoffs, and immediately begin Can you serve the long termimproving the tradeoffs for all sides” interests of the shareholders without paying attention to the others?
Utilitarian - It will lead to the best consequences Deontological - It respects the rights of stakeholders and the duty of the firm to them Virtue Ethics - It reflects well on the character and nature of the executive and firmBusiness is about collaboration: “The spirit of capitalism is the spirit ofindividual achievement together with the spirit of accomplishing great tasksin collaboration with others.” (Freeman)