Business Skills and Environment Part 1

what do we know about employee attitudes?

"Happy" employees ≠ Satisfied customers "Loyal" employees ≠ Satisfied customers

lynne pain describes it as:

"Moral science", or the "science of values" Evolving into "a much broader interest in organizational culture" - "values" as a "critical success factor in today's business world"

High performance organizations, and high performance leaders tend to define value creation more broadly to include:

- Customers - Shareholders - Employees - Community

Peter Drucker's definition of a "Customer":

-"Customers" buy (d'uh!) -"Stakeholders" care

Ethical Decision Making: The Baird 4+1 Model (adapted)

1. Gather all of the relevant data. Identify the decision maker - Be attentive (Facts - Stop and Think) 2. Organize and contextualize the data. Identify key values in tension - Be intelligent (Ethical Issues) 3. Analyze the data using the criteria of the four ethical lenses - Be Reasonable (Explore stakeholder views) Choose to act with courage as you seek the highest good - 4. Be Responsible (Courage, consult, commit) (Act transparently - beware self-interest) + Reflect on the decision process and your own core values - Return to awareness

"big three" questions to ask customers

1. Overall satisfaction 2. Repurchase intention/behavior ("loyalty") 3. Willingness to recommend**

what fraction of US workers have walked off the job on the basis of ethics issues?

1/3

what percent willing to trade off lower pay for working for firm with Ethical business practices?

82%

what percent of workers consider firm's Ethics as critical to employment choice?

94%

gentile's 7 pillars to voicing our values

Acknowledge shared values in others Choose to act (No choice is a decision) "Normalize" the value conflict Define a (professional) purpose Understand who we are - Exit or Loyalty? Use our Voice (persuasion) Prepare response (anticipate resistance)

Business Ethics - Laura Hartman (DePaul) and Joseph DesJardins (St. Johns):

Application of values within a business context Process of responsible decision making

three questions to recognizing inappropriate self-interest:

Are any options likely to be especially attractive or unattractive, particularly given the short- term interests of the decision makers? Are these interests likely to conflict with the interests of the main stakeholders? Are any conflicting interests likely to be strong enough to significantly distort the decision?

blind spot R&R

Belief that the motivejustifies method

Law does serve as a barrier or deterrent to unethical conduct, and presents one standard of accountability for corruption BUUUUT....

But remember, You choose to disregard law at your risk

the best leaders create commitment by:

Create a vision and involve others Reinforce values and hold people accountable Treat people with dignity and build their confidence Achieve results against a broader definition value creation

creative ethical alternatives:

Creative, ethical problem solving Not breaking, but bending the rigidity of rules for rules sake or existing processes ("Bend the Rules") CSR and Sustainability empower us to explore creative, potentially more efficient, more effective outcomes and consequences for stakeholders, particularly over the long-term If we begin with notions of the best ethical solutions or design for products or services, we may avoid many of the ethical challenges we otherwise would face and which incur significant accountability costs Safety, environment, community, culture

Law often responds to past events:

Difficult time anticipating future misconduct Difficult time being applied to unique circumstances

west point, three rules of thumb:

Does the action attempt to deceive anyone or allow anyone to be deceived? Does the action gain or allow the gain of privilege or advantage to which I or someone else would not otherwise be entitled? Would I be dissatisfied by the outcome if I were on the receiving end of the action?

evolutionary notions of self interest:

Easier to argue our position if we genuinely believe our own argument - Unaware of the influence of our own self-interest Truly believe we are right when we are wrong Convince ourselves that we are being fair or even altruistic Characterize the opposing view as self- interested or irrational

view of this issue: Financial, legal, competiveness, market issues and challenges

Explicit and routine process Subject to analyses Often critical discussion

payne's basic ethics framework:

Facts Ethical Issues Stakeholders assessment (Lenses) Identifying Standards (Respect the Rules) Principles and Law Objectivity Decision - Transparency, Fairness

operational definition of employee commitment:

Gaining the discretionary energy, effort, and ideas from people who voluntarily choose to follow your vision.

committed employees=

HAPPY CUSTOMERS

ethical values/principles

Honesty, Integrity, Courage, Trust, Fairness(Justice), Excellence, Self-Control (Temperance)

gentile's starting assumptions

I want to do this. (Act ethically) Repeated studies suggest most people want to be ethical I have done this before. I can do this more, and better. It is easier in some contexts than others. I am more likely to do this if I have practiced (have a script) how to respond. Mastering and delivering responses to frequently heard rationalizations can empower others who share my views to act But I cannot assume I know who those folks are.

Positive outcomes of ethics:

Increases occupational reputation Avoids economic impact of unethical activity Increases organizational stability Trust, Loyalty, Commitment of employees and managers Grows corporate longevity and increases value Provides higher long-term earnings Enhances market (and customer) trust Even increases marketing opportunities

Some connections between Ethics and the "hallmarks" of leadership and Emotional Intelligence, so called (EQ)

Integrity Self-assessment (honesty with ourselves and others) Self-regulation (trustworthiness; anticipating that ethical decision making often occurs in ambiguous factual circumstances)

lynne payne's fourth ethical questions:

Is the action consistent with the actor's basic duties? Does it respect the rights and other legitimate claims of the affected parties? Does it reflect best practice? Is it compatible with the actor's own deeply held commitments (might interchange "values" here

Pain's View of Ethics in business

Less about why or should Ethics be a part of business Q is which values and principles should guide business decisions How should Ethics be integrated w/i businesses? Changed environment and discussions with international business exec's on integrity in recent years

core principles and values

Often begin with our role models, our family, our culture, our roots, the society in which we live and work They are often foundational, but, as Burke suggests, we continue to develop and adapt them as we move through life

value of this issue: ethics challenge

Often left to instinct "Gut" response Ad hoc to the challenge

Andrew Wicks (Darden Sch.) describes Ethics as:

Originating from the Greek; "Theory of living" Thinking about right and wrong

ethical touchstones

Our Religious Secular (including family), and Work Legacies

Blind spot relationships

Overconfidence in process

morality

Personal compass of values and motives

leadership is not only about

Personal style Learned, developed competencies, but also: Values, 'character,' integrity, and ethical reasoning

actions

Persuade, Motivate, Lead, Stand Up, Speak Out, Said No, Listened

what are best practices?

Principles or standards of excellence (ethics codes, voluntary standards) Ideals, values, aspirations

rights and responsibilities

Prioritize autonomy over equality (what is my motive?)

results lens

Prioritize autonomy over equality (based on what will make them happy

reputation lens

Prioritize equality over autonomy (fair, balanced, different roles within the community)

relationships lens

Prioritize equality over autonomy (focus on finding fair and just result)

purpose of ethical appreciation

Raise ethical awareness Make better decisions Change unethical behavior Notice the positive impact

what is a right?

Requirement in others to behave in a certain fashion toward you - also often in law or codes Converse of duty

what is a duty?

Requirement to act or not to act toward others Basic moral duties in law or codes

commonly described as:

Rules or system governing conduct Our guiding principles/values

blind spot results

Satisfied with too little good

what are commitments?

Self-chosen or subjective moral convictions (principles, core values, standards of integrity

professional ethics

Shared and mutually enforced professional norm

ethics

Shared community values How we live our lives

rationalizations and hurdles to ethical decision making:

Slippery slope Victim mentality Everybody does it Cultural context - organizational and demographic "practice" or "the way things are done" Conflicting Interests - self-interest "Inappropriate self-interest" - evolutionary influence Don't challenge 'authority', obedience mentality "Moral disengagement" "Moral muteness"

we can speak up if we think through options:

Stop, and think strategically about the challenge or issue: Anticipate what standing up actually takes; handling discomfort, potential threats and isolation Communicate our values openly and clearly: Don't focus solely on the accuracy of how you express your values - the need is to communicate them Doesn't have to be confrontational or shouting out; can be other forms of persuading others to an ethical course When we do, we better appreciate ourselves than when we don't, and we avoid rationalization about future actions If we think about the Q, we make better considered decisions

overview and purpose-

Strong, very personal experiences in voicing values Each of us likely has likely had personal experience doing so

Bowen McCoy - Author of The Parable of the Sadhu

The authenticity and integrity of the enterprise Taking a tough line or decisional stand in a muddle of ambiguity

sustainability:

The integrated, systemic, lasting effect of attention to the natural environment

blind spot reputation

Unrealistic role expectation

personal core values

What are my core commitments? What behaviors count as living those values

community core values

What are the commitments of my community? What behaviors count?

being included

What behaviors are unacceptable? When do I go against the crowd

being respected by others

What behaviors does community expect? Aspirational - what kind of person should I become?

respecting ourselves

What values and behaviors do I expect of myself? What is my personal code of ethics?

what are similarities and differences between the communities values and my own??

Which values should take priority? What are the company's values and compliance duties? How do I resolve those differences?

leaders must know...

Who they are and what their values are How to process (frame) significant ethical issues Similar to other strategic processes of budget, HR, etc.

to express values, answer these questions:

Who we are. What perspective (outlook) do we use when we approach problems? Is there merit to us to listen to the perspectives of others? - in other words, might others have a better ethical solution?

traits

Wise, Open, Authentic, Steadfast, Accountable, Respectful, Caring, Credible, Inspirational, Encouraging, Self-Deprecating, Fun?

criminal law is designed to....

deter/sanction the worst of conduct (Not intended to ensure the best of expectation)

Intangibles' can be a long list, but are mostly about:

intellectual capital (patents, skills, etc.) - customer equity (brand and service reputation)

Bandura's moral disengagement:

moral self regulation system, cognitive disengagement processes, behavior

mary gentile: how we express our values in ethical situations

over view and purpose two alternative situations to raise question can be uncomfortable

best leaders; actions guided by:

passion, performance, principle

law is...

public policy, but a baseline of societal expectation Law is a floor limiting action, not the ceiling of integrity

sensibility over rationality:

results /reputation lens

rationality over sensibility:

rights and responsibilities/ relationships lens

being successful:

what you know, vs how you do things