Principles and Practices for Tomorrow’s Leaders
Gary Dessler
CHAPTER
2
Managing in a Cultural and
Ethical Environment
The Environment of Managing
PowerPoint Presentation by Charlie Cook
Copyright © 2004 Prentice Hall, Inc. All rights reserved.
Chapter Objectives
After studying this chapter and the case exercises at
the end, you should be able to:
1. Correctly identify both ethical and unethical
decisions.
2. Rate your own ethics level.
3. Assess and quantify the ethical culture of an
organization.
4. Design a specific plan for improving ethical
behavior in a company.
5. Specify the steps a manager should take to
change a company’s ethical culture.
6. Design a specific diversity management plan.
Copyright © 2004 Prentice Hall. All rights reserved.
2–2
The Wall Street Journal Workplace-Ethics Quiz
Source: Wall Street Journal, 21 October 1999, pp. 81–84. Ethics Officer Association, Belmont, Mass.; Ethics
Leadership Group, Wilmette, Ill.; surveys sampled a cross-section of workers at large companies and nationwide.
Copyright © 2004 Prentice Hall. All rights reserved.
FIGURE 2–1
2–3
The Meaning of Ethics
• Ethics
 The study of standards of conduct and moral
judgment; also, the standards of right conduct.
• Normative Judgment
 A comparative evaluation stating or implying that
something is good or bad, right or wrong, or better or
worse.
• Morality
 A society’s accepted norms of behavior.
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2–4
Good and Evil
• Teleologist
 A person who evaluates good or evil and right or
wrong based on the consequences or results of the
proposed actions.
• Deontologist
 A person who evaluates whether actions are good or
bad, right or wrong, based on their conformity to
certain principles that he or she feels must be
adhered to regardless of the consequences or results
of the proposed actions.
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2–5
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2–6
Ethics and the Law
• Important Points:
 Something may be legal but not right (ethical)
 Something may be right (ethical) but not legal.
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2–7
The Ethical Continuum
Low
Source: Source: Michael Boylan, Business Ethics
(Upper Saddle River, NJ: Prentice Hall, 2001), p. 119.
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High
FIGURE 2–2
2–8
What Influences Ethical Behavior At
Work?
Individual
Factors
Organizational
Factors
Ethical Work
Behaviors
Top
Management
Ethics Policies
and Codes
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2–9
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2–10
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2–11
Checklist 2.1
How to Foster Ethics at Work
 Emphasize top management’s
commitment.
 Publish an ethics code.
 Establish compliance mechanisms.
Involve personnel at all levels.
 Train employees.
 Measure results.
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2–12
Raytheon Company’s Quick Ethics Test
• Is the action legal?
• Is it right?
• Who will be affected?
• Does it fit company values?
• How will it “feel” afterwards?
• How will it look in the newspaper?
• Will it reflect poorly on the company?
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2–13
Company ethics officials say they convey
ethics codes and programs to employees
using these training programs:
The Role of Training
in Ethics
Company ethics officials use these
actual training tools to convey ethics
training to employees:
FIGURE 2–4
Source: Susan Wells, “Turn Employees into Saints,”
HRMagazine, December 1999, p. 52.
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2–14
What Is Organizational Culture?
• Organizational Culture
 The characteristic set of values and ways of behaving
that employees in an organization share.
• Patterns of Behavior
 Ceremonial events, written and spoken comments,
and actual behaviors of an organization’s members
that create the organizational culture.
• Values and Beliefs
 Guiding standards of an organization that affirm what
should be practiced, as distinct from what is
practiced.
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2–15
Ethics and Corporate Culture
Management
Ethics
Corporate
Culture
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2–16
Checklist 2.2
How to Create the Corporate Culture





Clarify expectations.
Use signs and symbols.
Provide physical support.
Use stories.
Organize rites and ceremonies.
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2–17
Components of Corporate Culture
• Signs and Symbols
 Practices and actions that create and sustain a
company’s culture.
• Stories
 The repeated tales and anecdotes that contribute
to a company’s culture by illustrating and
reinforcing important company values.
• Rites and Ceremonies
 Traditional culture-building events or activities that
symbolize the firm’s values and help convert
employees to these values.
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2–18
Managers And Social Responsibility
• Social Responsibility
 The extent to which companies should and do
channel resources toward improving the quality of life
of one or more segments of society other than the
firm’s own stockholders.
• Managerial Capitalism
 The classic view is that a corporation’s main purpose
is to maximize profits for stockholders.
• Stakeholder Theory
 Business has a social responsibility to serve all the
corporate stakeholders affected by its decisions.
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2–19
A Corporation’s Major Stakeholders
FIGURE 2–5
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2–20
Managers And Social Responsibility
(cont’d)
• Moral Minimum
 The idea that corporations should be free to strive for
profits so long as they commit no harm.
• Stockholders versus Stakeholders?
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2–21
Top-Rated Companies for
Social Responsibility
1.
2.
3.
4.
5.
6.
7.
8.
Johnson & Johnson
Coca-Cola
Wal-Mart
Anheuser-Busch
Hewlett-Packard
Walt Disney
Microsoft
IBM
Source: Ronald Alsop, “Perils of Corporate Philanthropy,” Wall Street Journal, 16
January 2002, pp. B1. 2001 Harris Interactive/ Reputation Institute Survey.
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9.
10.
11.
12.
13.
14.
15.
McDonald’s
3M
UPS
FedEx
Target
Home Depot
General Electric
FIGURE 2–6
2–22
How to Improve the Company’s Social
Responsiveness
• Corporate Social Audit
 A rating system used to evaluate a corporation’s
performance in meeting its social obligations.
• Whistle-blowing
 The activities of employees who try to report
organizational wrongdoing.
• Social Responsibility Networks
 Organizations that promote socially responsible
business practices and help managers to establish
socially responsible programs.
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2–23
Managing Diversity
• Managing Diversity
 Planning and implementing organizational systems
and practices to manage people in a way that
maximizes the potential advantages of diversity while
minimizing its potential disadvantages.
 Cultural diversity contributes to improved productivity,
return on equity, and market performance.
• Diverse
 Describes a workforce comprised of two or more
groups, each of which can be identified by
demographic or other characteristics.
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2–24
Bases for Diversity
• Racial and Ethnic
• Gender
• Older workers
• People with disabilities
• Sexual/affectional orientation
• Religion
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2–25
Barriers in Dealing with Diversity
• Stereotyping
 Attributing specific behavioral traits to individuals
on the basis of their apparent membership in a
group.
• Prejudice
 A bias that results from prejudging someone on the
basis of the latter’s particular trait or traits.
• Ethnocentrism
 A tendency to view members of one’s own group
as the center of the universe and to view other
social groups less favorably than one’s own.
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2–26
Barriers in Dealing with Diversity
(cont’d)
• Discrimination
 A behavioral bias toward or against a person based
on the group to which the person belongs.
• Tokenism
 Appointing a small number of minority-group
members to high-profile positions instead of more
aggressively achieving full group representation.
• Gender-Role Stereotyping
 Usually, the association of women with certain
behaviors and possibly (often lower-level) jobs.
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2–27
Checklist 2.3
How to Manage Diversity




Provide strong leadership.
Assess your situation regularly.
Provide diversity training and education.
Change the culture and management
systems.
 Evaluate the diversity program.
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2–28
Activities Required to Better Manage Diversity
FIGURE 2–7
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2–29