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organisational ethical climate's relationships

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Research proposal

  1. 1. N a t i o n a l U n i v e r s i t y o fM o d e r n L a n g u a g e sM B A - 7 ( E v e n i n g )4 / 2 4 / 2 0 1 3Mamoona SarwarSubmitted to: Mam BenishMadem,I am very much obliged that you give me opportunityto conduct research and thankful to you for yourguideline. I have chosen my topic which is ―ethicalclimate‘s relationship to job satisfaction,organizational commitment, and turnover‘‘ Detailedinformation about my research is within the researchproposal for your assistance. I am looking forward foryour acceptance so that I can continue my research.Ethical climate‘s relationship with jobsatisfaction, organizational commitment,and turnover
  2. 2. Abstract:This study will examine ethical climate‘s relationship to job satisfaction, organizationalcommitment, and turnover intention among salespeople. however salespeople are believed tobe physically, psychologically, and socially separated from the organization, but this studywill found out that is there any connection of job satisfaction, commitment and turnoverintention with ethical climate. A cross-sectional sample of business-to-business salespeoplein twin cities will be used. 20 Sales and Marketing companies in that area that employedsalespeople will be chosen as the sampling frame. Correlation will check the ethical climate‘srelationship to job satisfaction, organizational commitment, and turnover intention, to checkthe relationship intensity of studied variables regression will be used. The research can bevery useful to the management to understand the effect of ethical climate on salespeople andwhich variable is highly affected by ethical climate. This research will tries to determinepatterns while comparing organizations involved in ethical climate against those which arenot.
  3. 3. Introduction:Climate refers to the ways organizations operationalize routine behaviors and the actions that areexpected, supported and satisfied (Schneider and Rentsch, 1988). Ethical climate has beendefined as ‗‗the existing perceptions of typical organizational practices and procedures that haveethical content (Victor and Cullen, 1988, p.101).‘‘ in addition, an organization, subunit and workgroup may consist of many different types of climates—including an ethical climate (Schneider,1975). . The ethical components of environment are comprised of the behavioral norms andvalues that provide insight into the organizations point of view on various ethical situations(Hunt et al., 1989; Sims, 1991; Trevino et al., 1998; Valentine and Barnett, 2002). Many of thesecharacteristics stem from top managements ethical beliefs and become institutionalized withinthe organization so that employees are positively affected both attitudinally and behaviorally bythese perspectives (Hunt et al., 1989; James, 2000; Sims, 1991; Trevino et al., 1998;Viswesvaran et al., 1998; Vitell and Davis, 1990). Nowadays organizations hold climates thatrun everywhere from very ethical to very unethical. An international survey of 4000 businessemployees found that 25% of those responding believed that their companies ignore ethicalconduct to meet business objectives, and nearly 17% stated that their company openlyencourages misconduct to meet business objectives. (Goodell,1994).Significance:Organizational commitment and job satisfaction have received significant attention in studies ofthe work place. This is due to the general identification that these variables can be the majordeterminants of organisational performance and effectiveness (Angle, 1981; Riketta, 2002).Some studies have reported strong correlations of organizational commitment and jobsatisfaction with turnover (Benkhoff, 1997). Employees are less committed & look for otheropportunities when they are dissatisfied at work, If opportunities are not available, they mayemotionally or mentally ―withdraw‖ from the organization. A closer look at these studies,however, finds that while the relationships between organizational ethical values and roleconflict, satisfaction, and performance have been investigated in a sales setting (i.e., Weeks andNantel, 1992; Schwepker et al., 1997), the relationships between Organizational ethical values,and organizational commitment, and turnover have not. Moreover, the one study that examinedthe relationship between ethics and satisfaction in the sales force examined only one company inone industry (i.e., Weeks and Nantel, 1992).Scope:The present study will examine the relationship between the organization‘s ethical climates (anexpression of its ethical values), job satisfaction, organizational commitment, and turnoverintention among salespeople. If ethical climate have positive relationship with job satisfaction,organizational commitment, and turnover intention among salespeople then an ethical climate,organizations may be able to reduce undesirable turnover via greater organizational commitment,and remove undesirable salespeopleLimitation:This study is not without limitations this study assessed salespeople‘s perceptions oftheir firm‘s environment, not their individual ethics.
  4. 4. Literature Review:Ethical climate has been defined as ‗‗the prevailing perceptions of typical organizationalpractices and procedures that have ethical content (Victor and Cullen, 1988, p. 101).‘‘ Topmanagement appears to play a critical role in the formation and perpetuation of a firm‘s ethicalclimate (Deal and Kennedy, 1982; Schein, 1985). The literature suggests that the climate forunethical conduct is present when a firm does not enact and enforce codes of ethics, policies, anddirectives that specify, discourage, monitor, and correct unethical behavior (Ferrell and Gresham,1985). Higher levels of ethical behavior have been found in firms where codes of ethics are inplace and enforced (Ferrell and Skinner, 1988). When codes become an active part of anemployee‘s working knowledge, they are more likely to affect the individual‘s ethical decisionmaking (Hegarty and Sims, 1979). Additionally, codes that are effectively communicated(i.e.,understood) are likely to result in greater ethical behavior (Weeks and Nantel, 1992).Organizational culture can influence how people set personal and professional goals, performtasks and manage resources to accomplish them. Organizational culture affects the way in whichpeople knowingly and unknowingly think, make decisions and in the end the way in which theyperceive, feel and act (Hansen and Wernerfelt, 1989; Schein, 1990). Deal and Kennedy (1982)and Peters and Waterman (1982) have suggested that organizational culture can exert greatinfluence in organizations particularly in areas such as performance and commitment.Lastly, reward and punishment are used to create an ethical climate. Supervisors can influencebehavior through their administration of rewards and punishment (Trevino, 1986; Posner andSchmidt, 1987). For instance, Podsakoff (1982) found that appropriately distributed disciplinecan result in a correction of behavior. Actual discipline, or even the threat of punishment, mayindirectly influence the decision to behave ethically via its effects on one‘s perceptions of likelyconsequences for unethical behavior and the desirability of those consequences. However, theabsence of punishment may provide an opportunity for unethical behavior Locke (1969, p. 316)defines job satisfaction as ‗‗the pleasurable emotional state resulting from the appraisal of one‘sjob as achieving or facilitating the achievement of one‘s job values.‘ Several studies from avariety of occupations indicate that individuals‘ job satisfaction is related to their perceptions ofaspects of the firm‘s organizational climate (Kaczka and Kirk, 1968; Friedlander andMargulies,1969; Schneider, 1972; Schneider and Snyder, 1975;Pritchard and Karasick, 1973;Downey et al., 1974;Churchill et al., 1976; Ostroff, 1993; Pierce et al.,1996; Johnson andMcIntye 1998).Recent evidence suggests that elements of an organization‘s climate are significantly related toorganizational commitment. Examining the relationship between 12 climate dimensions andvarious job-related outcomes, Ostroff (1993) found the strongest associations between climatedimensions and organizational commitment. Intention to leave appears to be the immediateprecursor to actually quitting. It is consistent with Fishbein‘s (1967) model of attitudes,intentions, and behavior and its use is commonly endorsed in the literature as a predictor ofturnover (Mobley, 1982). A literature review by Bluedorn (1982) cited 23 studies which reportedfinding significant positive relationships between leaving intentions and actual leaving behavior.Given that ethical climate has been found to influence ethical behavior, it can be used to providedirection for ethical selling (i.e., provides sales force with ethical codes and policies to followand consequences for not doing so). At the same time, this ethical climate may conflict withattitudes and behaviors of unethical salespeople. Person–organization fit theory suggests thatindividuals who do not perceive a fit between themselves and the organization are more likely toquit (e.g., Downey et al., 1975; Apasu, 1986; Caldwell and O‘Reilly, 1990; De- George, 1990).
  5. 5. Consequently, unethical salespeople operating in an ethical organization should experience a‗‗misfit‘‘ and be more willing to leave the organization. The unethical salesperson provides nobenefits to the customer- oriented organization and their departure is desirable. In essence, anethical climate may encourage desirable (ethical) salespeople to stay and undesirable (unethical)salespeople to leave.
  6. 6. Theoretical framework:H1 (+) H4 (+)H2 (+)H3 (-)H5 (-)OrganizationalEthical climateJob satisfactionOrganizationalcommitmentTurnover Intention
  7. 7. HYPOTHESIS:H1:There is a positive relationship between organization‘s ethical climate and their job satisfaction.H2:There is a positive relationship between organization‘s ethical climate and their organizationalcommitmentH3:There is a negative relationship between organization‘s ethical climate and their turnoverintention.H4:The greater the salespeople‘s job satisfaction, the greater their organizational commitmentH5:The greater the salespeople‘s organizational commitment, the less their expected turnoverintention.
  8. 8. Methodology:1. PopulationAs far as population is concerned I have selected Sales & marketing pharmaceuticals companiesof Islamabad and Rawalpindi as sector, Industry will be private as title shows too nature is Salespersons, For Segmentation both Male and female will be considered. Age factor is also includedhere, from 20-35 years old.2. SampleA cross-sectional sample of business-to-business salespeople in twin cities will be used. 20 Salesand Marketing companies in that area that employed salespeople will be chosen as the samplingframe.3. InstrumentsInstrument which I am going to use for survey of my research will questionnaire type, for ratingliker Scale will be used.4. Statistical toolsCorrelation will be use to check the ethical climate‘s relationship to job satisfaction,organizational commitment, and turnover intention, to check the relationship intensity of studiedvariable I will regression.
  9. 9. References:1. Schneider B, Rentsch J. Managing climates and cultures: a future perspective,in futures oforganizations. In: Hage J, editor. Lexington, MA:Lexington Books, 1988. pp. 181– 200.2. Schneider B. Organizational climate: an essay. Pers Psychol 1975;28(Winter):447–79.3. Goodell R. National business ethics survey findings. Ethics J (Fall/Winter) 1994;1, 3, 5.4. Weeks W, Nantel J. Corporate codes of ethics and sales force behavior: a case study. J BusEthics 1992;11(October):753– 60.5. Schwepker CH, Ferrell OC, Ingram TN. The influence of ethical climate and ethical conflicton role stress in the sales force. J Acad Mark Sci 1997;25(Spring):99–108.6. Victor B, Cullen JB. The organizational bases of ethical work climates. Adm Sci Q1988;33(March):101– 25.7. Deal T, Kennedy A. Corporate cultures: the rites and rituals of corporate life. Reading, MA:Addison-Wesley Publishing, 1982.8. Schein E. Organizational culture and leaders: a dynamic view. San Francisco: Jossey-Bass,19859. Ferrell OC, Gresham LG. A contingency framework for understanding ethical decisionmaking. J Mark 1985;49(Summer):87–96.10. Ferrell OC, Skinner SJ. Ethical behavior and bureaucratic structure in marketing researchorganizations. J Mark Res 1988;25(February):103– 9.11. Hegarty HW, Sims HP. Organizational philosophy, policies, and objectives related tounethical decision behavior: a laboratory experiment. J Appl Psychol 1979;64(June):331– 8.12. Podsakoff PM. Determinants of a supervisor‘s use of rewards and punishments: a literaturereview and suggestions for further research. Organ Behav Hum Perform 1982;29(February):58 –83.13. Ostroff C. The effects of climate and personal influences on individual behavior and attitudesin organizations. Organ Behav Hum Perform 1993;56(October):56–90.14. Fishbein M. Attitude and the prediction of behavior. In: Fishbein M, editor. Readings inattitude theory and measurement. New York, NY: Wiley,1967. pp. 477– 92.15. Bluedorn AC. A unified model of turnover from organizations. HumRelat1982;35(February):135–53.16. Apasu Y. Identifying the antecedents of salespersons‘ intention to leave. Akron Bus EconRev 1986;17(Winter):85– 97.17. Ostroff C. The effects of climate and personal influences on individual behavior and attitudesin organizations. Organ Behav Hum Perform1993;56(October):56–90.18. Hunt, S. D., V. Wood and L. Chonko: 1989, Corporate Ethical Values and OrganizationalCommitment in Marketing, Journal of Marketing 53, 79-90.19. Sims, R. R.: 1991, The Institutionalization of Organizational Ethics, Journal of BusinessEthics 10, 493 506.20. James, H. S. Jr.: 2000, Reinforcing Ethical Decision Making Through OrganizationalStructure, Journal of Business Ethics 28, 43-58.21. Trevino, L. K., K. Butterfield and D. McCabe: 1998, The Ethical Context in Organizations:Influences on Employee Attitudes and Behaviors, Business Ethics Quarterly 8, 447-476.