MGMT 3400 Exam 2 Study Terms (Ch. 5, 6, 7, 11)

Internal locus of control

-They control the events in their lives by their own effort and skill. Master of your own destiny You are able to influence your environment

Categories of Ethical Communication

1)Interpersonal Communication 2)Listening 3)Small Group Communication 4)Nonverbal communication Transparency: Develops a culture where ethics is frequently discussed. Reporting: Two-way process—both employee and leader feel a responsibility to report to one's subordinates.

caring culture

High concern for people but minimal concern for performance issues. It is difficult to find nationally recognizable companies that maintain little or no concern for performance

RADAR Model

Recognize Avoid Discover Answer Recover

corporate culture

a set of values, norms, and artifacts, including ways of solving problems that members (employees) of an organization share.

John Rawls

•Believed justice principles were beliefs that everyone could accept.

whistle blowers

•Exposing an employer's wrongdoing to outsiders such as the media or government regulatory agencies. •Sometimes used to refer to internal reporting of misconduct to management, especially through anonymous reporting mechanisms often called hotlines. Legal Protection •Sarbanes-Oxley Act •The Federal Sentencing Guidelines for Organizations (FSGO) •The U.S. Department of Labor (DOL) •The Corporate and Criminal Fraud Accountability Act (CCFA) •Securities and Exchange Commission •The Dodd-Frank Act

teleology

(from the Greek word for "end" or "purpose") refers to moral philosophies in which an act is considered morally right or acceptable if it produces some desired result, such as pleasure, knowledge, career growth, the realization of self-interest, utility, wealth, or even fame.

Deontology

(from the Greek word for "ethics") refers to moral philosophies that focus on the rights of individuals and the intentions associated with a particular behavior rather than its consequences. Fundamental to deontological theory is the idea that equal respect must be given to all persons.

Gender and Ethical Decisions

- In many aspects there are no differences between men and women with regard to ethical decision making.

normative approach

-how organizational decision-makers should approach an issue -revolves around the standards of behavior within the firm as well as within the industry -examines what ought to occur in business ethical decision making. The word "normative" is equivalent to an ideal standard.

Age and Ethical Decisions

-older employees with more experience have greater knowledge to deal with complex industry-specific ethical issues. Younger managers are far more influenced by organizational culture than older managers.

Institutional Theory

-organizations operate according to taken-for-granted institutional norms and rules. -For instance, government, religion, and education are institutions that influence the creation of values, norms, and conventions that both organizations and individuals should adhere.

values

-subjective and related to choice -used to develop norms -provides guidance to organizations -differs across cultures and firms

principles

-widely accepted -used to develop values and standards -establishes pervasive boundaries for behavior -valued across cultures

Kohlberg's 6 stages of cognitive development

1) The stage of punishment and obedience (An individual defines right as literal obedience to rules and authority) 2) The stage of individual instrumental purpose and exchange (defines right as what serves his or her own needs) 3) The stage of mutual interpersonal expectations, relationships, and conformity (emphasize the interests of others rather than simply those of themselves, although ethical motivation is still derived from obedience to rules) 4) The stage of social system and conscience maintenance (determine what is right by considering their duty to society, not just to certain other people) 5) The stage of prior rights, social contract, or utility (concerned with upholding the basic rights, values, and legal contracts of society) 6) The stage of universal ethical principles (believes right is determined by universal ethical principles everyone should follow.)

Common Justifications for White-Collar Crime

1. Denial of responsibility. (Everyone can, with varying degrees of plausibility, point the finger at someone else.) 2. Denial of injury. (White-collar criminals often never meet or interact with those who are harmed by their actions.) 3. Denial of the victim. (The offender is playing tit-for-tat and claims to be responding to a prior offense inflicted by the supposed victim.) 4. Condemnation of the condemners. (Executives dispute the legitimacy of the laws under which they are charged, or impugn the motives of the prosecutors who enforce them.) 5. Appeal to a higher authority. ("I did it for my family" remains a popular excuse.) 6. Everyone else is doing it. (Because of the highly competitive marketplace, certain pressures exist to perform that may drive people to break the law.) 7. Entitlement. (Criminals simply deny the authority of the laws they have broken.)

Ethical Corporate Culture

1.Requirement that management assess the effectiveness of the organization's internal controls and commission audits of these controls by an external auditor in conjunction with the audit of its financial statements. 2.Requires firms to adopt a set of values that forms a portion of the company's culture. 3.Mandates an evaluation of corporate culture to provide insight into the character of an organization, its ethics, and transparency. 4.The intent is to expose mismanagement, fraud, theft, abuse, and to sustain a corporate culture that does not allow these conditions and actions to exist.

economic values orientation

Associated with values quantified by monetary means. If an act produces more economic value for its effort, then it should be accepted as ethical.

Distributive Justice

Based on the evaluation of outcomes or results of the business relationship. -emphasizes benefits derived and equity in rewards

procedural justice

Based on the processes and activities that produce the outcome or results -emphasizes Decision making process & Level of access, openness, and participation

integrative culture

Combines a high concern for people and performance. An organization becomes integrative when superiors recognize employees are more than interchangeable parts—employees have an ineffable quality that helps the firm meet its performance criteria

Utilitarianism

Defines right or acceptable actions as those that maximize total utility or the greatest good for the greatest number of people

expert power

Derived from a person's knowledge (or a perception that a person possesses knowledge). Usually stems from a superior's credibility with subordinates. Credibility (expert power), is positively correlated to the number of years a person worked in a firm or industry, education, and honors he/she has received for performance.

Difference Principle

Economic and social equalities (or inequalities) should be arranged to provide the most benefit to the least-advantaged members of society.

Veil of Ignorance (Rawls)

Examined how individuals would formulate principles if they were uncertain about their future position in society.

referent power

Exists when one person perceives that his/her goals or objectives are similar to another's with an attempt to influence the first to take actions that allows both to achieve their objectives. Identification with others helps boost the decision maker's confidence, thus increasing the referent power.

Obedience to authority

Explains why many employees resolve business ethics issues by simply following the directives of a superior

Guilt or uneasiness

First sign that an unethical decision was made

Nationality and Ethical Decisions

Impossible to state that ethical decision making in an organizational context will differ significantly among individuals of different nationalities.

Ethical Decision Making Process

Involves: -Ethical issue intensity -Individual factors -Organizational Factors

exacting culture

Little concern for people but a high concern for performance. Focuses on the interests of the organization.

Organizational Factors

Organizational culture has a stronger influence on employees than individual values Ie corporate culture, loved ones, obedience to authority

coercive power

Penalizes actions or behavior and relies on fear to change behavior. More effective in changing behavior in short versus long run. Often employed where there is an extreme imbalance of power. People continually subjected to coercion may seek a counterbalance and align themselves with other, more powerful persons or leave the organization.

Individual factors

People base their ethical decisions on their own values and principles of right or wrong -Values are learned through socialization -Values are subjective, vary across cultures

Define Power (textbook). Identify ethical and unethical uses of power by Lance Armstrong.

Power refers to the influence leaders and managers have over the behavior and decisions of subordinates. Unethical Power: Lance Armstrong used reward power by bringing people who doped on the team and to stay on the team. He used coercive power to punish riders who would not dope by ultimately removing them from the team. Ethical Power: Many years late, Lance Armstrong used legitimate power to influence all sorts of athletes that doping is wrong. Armstrong traveled the world trying to rectify what he can. That he has apologized to every person that the public might think deserves one.

Moral intensity

Relates to a person's perception of social pressure and the harm his/her decision will have on others

Opportunity

The conditions in an organization that limit/permit unethical/ethical behavior

Ethical Issue Intensity

The perceived relevance or importance of an ethical issue to the individual, workgroup, and/or organization •Personal and temporal in character to accommodate values, beliefs, needs, perceptions, the special characteristics of the situation, and the personal pressures prevailing at a particular place and time.

significant others

Those who have influence in a work group, including peers, managers, coworkers, and subordinates. -Numerous studies conducted over the years confirm that significant others within an organization may have more impact on a worker's decisions on a daily basis than any other factor

Transactional and transformational leadership (textbook definition, name specific leader, provide leadership examples

Transactional= leader that attempts to create employee satisfaction through negotiating, or "bartering," for desired behaviors or levels of performance Transformational= leader that strives to raise employees' level of commitment and foster trust and motivation Nick Saban, the football coach of Alabama, is an example of transactional leadership. He motivates his players by promoting the reward of winning the game. Saban has instiled such a high level of commitment that his players are willing to risk pain and injury to obtain the results that he is asking for. Reed Hastings, the co-founder, and CEO of Netflix is an example of a transformational leader. He demonstrated transformational leadership by influencing and motivating his employees. For instance, he allows his employees to be very involved and gives them independence, ownership, and empowerment.

work groups

Used to subdivide duties within specific functional areas of a company •Enables specialization. •Ethical conflicts may arise because team members come from different functional areas. •Conflicts when members of different organizational groups interact

Virtue Ethics

What is moral in a given situation is not only what conventional morality requires but what a person with a "good" moral character deems appropriate. 1.Good corporate ethics programs encourage individual virtue and integrity. 2.By the employee's role in the community (organization), these virtues form a good person. 3.An individual's ultimate purpose is to serve society's demands and the public good and be rewarded in his or her career. 4.The well-being of the community goes hand in hand with individual excellence.

Immediate job context of opportunity

Where employees work, who they work with, and the nature of the work. -Opportunities for misconduct can be reduced by establishing and enforcing formal codes, policies, and rules -Knowledge can sometimes lead to unethical behavior

4 organizational cultures

apathetic caring exacting integrative

transactional leader

attempt to create employee satisfaction through negotiating, or "bartering," for desired behaviors or levels of performance

Conflict Management Styles

avoiding accommodating competing compromising collaborating

Coaching leader

builds a positive climate by developing skills to foster long-term success, delegating responsibility, and skillfully issuing challenging assignments.

pacesetting leader

can create a negative climate because of the high standards that he or she sets. This style works best for attaining quick results from highly motivated individuals who value achievement and take the initiative.

Authoritative Leadership

considered to be one of the most effective styles—inspires employees to follow a vision, facilitates change, and creates a strongly positive performance climate.

centralized organization

decision making authority is concentrated in the hands of top-level managers, and little authority is delegated to lower levels. Responsibility, both internal and external, rests with top-level managers. This structure is especially suited to organizations that make high-risk decisions and have lower-level managers not highly skilled in decision making.

egoism

defines right or acceptable behavior in terms of its consequences for the individual. Egoists believe they should make decisions that maximize their own self-interest, which is defined differently by each individual

relativist

definitions of ethical behavior are derived subjectively from the experiences of individuals and groups. Relativists use themselves or the people around them as their basis for defining ethical standards, and the various forms of relativism include descriptive, meta-ethical, and normative.

coercive leader

demands instantaneous obedience and focuses on achievement, initiative, and self-control. Although this style can be very effective during times of crisis or during a turnaround, it otherwise creates a negative climate for organizational performance.

Justice

fair treatment and due reward in accordance with ethical or legal standards, including the disposition to deal with perceived injustices of others. The justice of a situation is based on the perceived rights of individuals and on the intentions of the people involved in a business interaction.

Social institutions (examples)

include religion, education, and individuals such as the family unit.

Leader-follower congruence

occurs when leaders and followers share the same vision, ethical expectations, and objectives for the company

authentic leadership

passionate about the company, live out corporate values daily in their behavior in the workplace, and form long-term relationships with employees and other stakeholders

core values

provide a blueprint into the firm's purpose as well as how it views ethical decision making and prioritizes stakeholders.

Moral Philosophy

refers to the specific principles or values people use to decide what is right and wrong

Ethical Culture

reflects the integrity of decisions made and is a function of many factors including: -corporate policies -top management's leadership on ethical issues -the influence of coworkers -the opportunity for unethical behavior

democratic leader

relies on participation and teamwork to reach collaborative decisions. This style focuses on communication and creates a positive climate for achieving results.

Transformational leader

strive to raise employees' level of commitment and foster trust and motivation

emotional intelligence

the ability to manage themselves and their relationships with others effectively -Emotionally intelligent leaders are skilled in self-awareness, self-control, and relationship building

ethical awareness

the ability to perceive whether a situation or decision has an ethical dimension

Ethical Leadership

the demonstration of normatively appropriate conduct through personal actions and interpersonal relationships, and the promotion of such conduct to followers through two-way communication, reinforcement, and decision making

differential association

the idea that people learn ethical or unethical behavior while interacting with others who are part of their role-sets or belong to other intimate personal groups

Organizational culture dimension: concern for people

the organization's efforts to care for its employees' well-being.

Organizational culture dimension: concern for performance

the organization's efforts to focus on output and employee productivity.

affiliative leadership style

values people, their emotions, and their needs and relies on friendship and trust to promote flexibility, innovation, and risk taking.

employee empowerment

when employees are provided with the ability to take on responsibilities and make decisions about their jobs -empowered by integrity-based approach

5 power bases

· reward power · coercive leader · expert power · legitimate power · referent power

Reward power

•Ability to influence the behavior of others by offering them something desirable (money, status, or promotion).

white collar crime

•Does more damage in monetary and emotional loss in one year than violent crimes do over several years combined. •Tend to be highly educated, in positions of power, trust, respectability, and responsibility. •The corporate culture can transcend the individuals beliefs. •With time, patterns become institutionalized sometimes encouraging unethical behaviors.

Liberty Principle (equality principle)

•Each person has basic rights that are compatible to the basic liberties of others.

External locus of control

•Going with the flow. Life events are due to uncontrollable forces. External factors affect you (no control over the situation)

group norms

•Help define acceptable and unacceptable behavior within a group. •Define the limit allowed on deviations from group expectations. •Provide explicit ethical directions. •Can relate directly to managerial decisions. •Have the power to enforce a strong degree of conformity among group members. •Can define the different roles for various positions within the organization.

Locus of Control

•How people view themselves in relation to power. -relates to individual differences in relation to a generalized belief about how one is affected by internal versus external events or reinforcements

Ethical Leadership and Corporate Culture: Integrity-Based Approach

•Leaders take responsibility for the firm's ethical culture and hold employees accountable. •Usually have chief officers, human resource managers, and board member committees involved with ethics and compliance. •Approach empowers employees. •Can help the firm understand where questionable practices are occurring and where possible new ethical issues are arising. •Business is not static; it is dynamic. •Ethical leaders use an integrity/compliance combination.

informal groups

•May generate disagreement and conflict, or enhance morale and job satisfaction. -Can help develop informal channels of communication, sometimes called the grapevine

apathetic culture

•Minimal concern for either people or performance. Individuals focus on their own self-interest.

legitimate power

•Stems from the belief that a certain person has the right to exert influence and certain others have an obligation to accept it (titles and positions of authority).

Education and Ethical Decisions

•Those more familiarized with the ethical decision making process due to education or experience are likely to spend more time examining and selecting different alternatives to an ethics issue.