MGT 408 Exam 2

What are the four steps in the deliberative ethical decision-making model proposed by Rest (1986)?

- moral awareness: where people initially become aware of the moral or ethical implications of their decision - moral judgment: where people apply rules or principles to determine the ethicality of options - moral intention: where people weigh moral concerns against issues like feasibility and self-interest - moral behavior: where people implement the ethical option

explain abusive behaviors

- most common ethical issue faced by employees today - can mean anything from physical threats, false accusations, annoying a coworker, profanity, insults, yelling, harshness, and ignoring someone to the point of being unreasonable - can stem from either supervisors (abusive supervision) or coworkers (workplace deviance)

what are the benefits of ethical leadership

1) higher employee satisfaction and commitment 2) workplace productivity 3) strong connections with external stakeholders 4) financial performance (revenues, profitability, growth, stock price)

How are codes of ethics transmitted across all levels of an organization?

They are usually developed through involvement of board members, top management teams, legal and compliance departments, and ethics departments, over a long time, addressing many areas of risk within the company.

Define sexual harassment. How is quid pro quo sexual harassment different from hostile work environment harassment?

Sexual harassment is a special form of workplace harassment that is based on sex. It covers unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature which, when submitted to or rejected, affects an individual's employment, unreasonably interferes with an individual's work performance, or creates an intimidating, hostile, or offensive work environment. There are two general categories of sexual harassment: quid pro quo sexual harassment, which is a type of sexual extortion where there is a proposed or explicit exchange of job benefits for sexual favors; and hostile work environment sexual harassment which involves epithets, slurs, negative stereotyping, intimidating acts, graphic materials, etc. that show hostility toward an individual or group, and other types of sexual conduct that might affect the employment situation.

What are the key differences between transactional leadership and transformational leadership in the types of power employed?

Transactional leadership is primarily based on processes and control, and requires a strict management structure. Transformational leadership, on the other hand, focuses on inspiring others to follow, and it requires a high degree of coordination, communication and cooperation.

If a discount store in the United States knowingly or unknowingly sold horsemeat burger patties labelled as "USDA-certified organic beef burger patties," what law would the store be in violation of? - Name the agency entrusted with upholding this law in the United States.

except for meat, poultry and eggs, which is addressed by the US Department of Agriculture or USDA

Newcomers to organizations often rely on interactions with supervisors, peers and subordinates to get a 'lay of the land,' and for help in decision-making. What are some pros and cons of these interactions in relation to ethical decision-making in organizations?

follow others behavior, so this is dependent on the companies ethical beliefs

explain discrimination

o Discrimination is not only a legal issue but also an ethical one, since it violates the principle of equal opportunity for entering and advancing in the workplace § Discrimination can be based on many different characteristics - age, gender, weight, race, ethnicity, religion, or even politics. Different labels may be applied to discrimination based on different characteristics o It is illegal to discriminate against someone on the basis of race, color, religion, sex (including gender identity, sexual orientation, and pregnancy), national origin, age (40 or older), disability or genetic information § illegal to retaliate against someone because they complained about discrimination, filed a charge of discrimination, or participated in an investigation or a lawsuit

explain sexual harassment

o illegal when it is so frequent or severe that it creates a hostile or offensive work environment or when it results in an adverse employment decision (such as the victim being fired or demoted) o Any unwanted behavior of a sexual nature perpetrated upon one individual by another (verbal, visual, written, or physical) can constitute sexual harassment o Two basic forms of sexual harassment: quid pro quo and hostile work environment

Over the last hundred years, there has been a dramatic shift in the "contract" and mutual understanding that exists between employees and employers. Trace the evolution of the employee-employer relationship since the late 19th century all the way to the 21st century.

- From the early days of industrialization all the way until the early 1900s, most companies took employees for granted. The big employers at that time (agricultural plantations, mines, railroads, construction, shipping, etc.) treated their employees poorly. Employment was viewed as a privilege and employees were expected to sacrifice their personal and family well-being (and sometimes even their health and lives) for the benefit of their employers. During these early days of industrialization, the relationship between an employer and an employee can be best described as a 'master-servant' relationship, where employees had few rights and tremendous obligations in their employment. - Collective Bargaining in the 1920s to 1930s employees banded together in the form of employee unions to assert their rights. - Corporate Responsibility in the 1950s to 1970s - Globalization, Competition and the Breakdown of the Family Analogy in the 1970s and 1980s

what are the types of misconduct commonly found in the workplace

- abusive behaviors - bribery - discrimination - sexual harassment

examples of abusive supervision

- assigning tasks that are beyond a person's skill level - establishing unrealistic timelines, or frequently changing dealings - denying access to information, consultation, or resources necessary to do one's job - excessively monitoring an employee's work - repeatedly reminding someone of past errors or mistakes - inconsistently following or enforcing rules, to the detriment of an employee - ignoring an employee, or isolating them form others - denying equal access to earned time off

define psychological contract breach

A psychological contract breach is defined as an employee's perception that his or her organization has failed to fulfill one or more obligations associated with perceived mutual promises

Some people believe in making decisions that maximize their own self-interest. Which moral philosophy do these people subscribe to?

Chapter 5

Some organizations go above and beyond the minimum legal standards to ensure employee well- being. Briefly describe a few programs undertaken by exemplary organizations. (Conduct a little research!) - Do these organizations benefit from going beyond mere legal compliance?

Apart from doing the legal minimum, companies have a moral obligation to look out for the welfare of their employees. Remember that law and regulation are constantly evolving based on the evolving standards of society. The only way a company can predict and proactively adapt to evolving law and regulation is by developing a real and enduring concern for the well-being of its employees. Happier employees tend to stay with their employer and better serve coworkers, customers, and other constituents, all of which have direct bearings on the financial prospects of a firm. Because of this, firms have been diligently investing in programs to empower their employees, improve their knowledge, help them grow professionally and achieve work-life balance. - General Motors started the 'General Motors Institute,' which stressed engineering studies and a co-op model where students combined traditional learning with lots of practical experience. Similarly, for more than 50 years, McDonald's Hamburger University (see video below!) has offered management training to thousands of mid-level-and-above managers, not offering official degrees but certifications that the trained individuals are knowledgeable about how McDonald's runs its operations. Even Amazon is entering the fray, not offering college degrees, but rather practical training for over 100,000 employees. The technology used by Amazon is constantly evolving, so it needs to continuously train workers in ways to improve productivity. Once an employee is trained (sometimes over a few weeks, months or even years), the employee then signs a long-term contract giving them some job security, while Amazon is assured at least some return on its human capital investment.

What is a code of ethics (or a code of conduct)? What are a few characteristics of an effective code of ethics?

Codes of conduct (or codes of ethics) are formal statements that describe what an organization expects of its employees - For business organizations, codes of conduct may address a variety of situations, from internal operations, sales practices, financial disclosure practices, etc., and try to communicate acceptable ways of doing things in a variety of contexts. They are usually developed through involvement of board members, top management teams, legal and compliance departments, and ethics departments, over a long time, addressing many areas of risk within the company.

Define organizational culture. How is culture transmitted across the organization?

Culture is transmitted to employees through the instillment of particular values in the mindset and processes employees are involved in on a daily basis. This can be through regular team meetings, as well as programs used to encourage employees to work in teams and contribute to the discussion.

What are some of the characteristics of an ethical leader?

Ethical leaders usually develop their skills through years of training, experience, and learning. To be an ethical organization leader, individuals should model corporate values; place the firm's interests above their own; empathize with their employees; develop tools for monitoring and reporting unethical conduct; recognize the limitations of rules and values; and last but not the least, never ignore issues of misconduct. - believe in the companies values - mechanisms of dissent - create conversation about ethics

What are the two broad types of ethics training programs in use today?

Ethics training can be conducted using a variety of formats, from lectures and other theoretical training methods on one hand to real-life case studies and other tailor-made practical methods on the other. Normally, scenario-based practical training methods where participants make simulated decisions in real-life situations are much more effective than theory-based lectures. But that said, it is important for top management and HR leadership to motivate employees to engage in these training exercises - without employee buy-in, no ethics training program can be effective in the medium to long-term.

How does ethical training help improve one's decision-making?

Ethics training is a useful tool for bringing about ethical behavior and preventing ethical lapses at all levels in an organization. It helps employees recognize situations where organizational values may be in peril, apply organizational principles to make moral judgments, and draw on organizational resources to help resolve ethical dilemmas.

The Me-Too movement has gained a lot of traction in the last few years, with hundreds of cases of sexual harassment being disclosed across the country. Based on your team's research of the Me- Too movement, answer the following: - How might organizations even begin to address some of these root causes of sexual harassment?

I think encouraging business and employers to have more routine sexual harassment trainings for every employee, having multiple ways for employees to report acts of sexual harassment (including anonymous submissions), and work to hire back the victims that were previous fired after reporting an instance of sexual harassment will work to fight against this misconduct and encourage employment rights for all.

define quid pro quo

Latin for 'this for that,' where sexual favors are exchanged for some kind of employment benefit

What exactly does the consumers' "right to safety" entail?

The Right to Safety implies that it is upon companies to create safe products - that products should be safe for their intended use, include instructions for proper and safe use, and be tested to ensure safety and reliability. When products pose safety risks, these risks need to be communicated to consumers effectively in ways that they can easily understand (like that big tag on your hairdryer chord). Companies that fail to provide for this right to safety can not only face lawsuits from the FTC and CPSC (Consumer Products Safety Commission), but also product liability lawsuits from affected consumers. - Pure Food and Drug Act created the Food and Drug Administration (FDA) - Consumer Product Safety Commission (CPSC) >> the CPSC works to reduce the risk of injuries by issuing and enforcing mandatory safety standards; coordinating the recall of consumer products and arranging for their repair, replacement or refund; conducting research on potential product hazards; and informing and educating consumers about safety issues

What exactly does the consumers' "right to be informed" entail?

The Right to be Informed says that consumers have a basic right to be protected against fraudulent, deceitful, or grossly misleading information, advertising, labeling, or other practices, and to be given the facts needed to make informed purchase decisions. Companies that provide inadequate, inaccurate or deceptive information about the features of their product or service offerings often violate this basic consumer right. - he Fair Packaging and Labeling Act (FPLA), enacted in 1967, for instance, directs the FTC and the Food and Drug Administration (FDA) to issue regulations requiring that all "consumer commodities" be labeled to disclose net contents, identity of commodity, and name and place of business of the product's manufacturer, packer, or distributor. - The Truth in Lending Act (TILA) similarly protects consumers against inaccurate and unfair credit billing and credit card practices. It requires lenders to provide consumers with loan cost information so that they can comparison-shop.

What are the two broad types of codes of ethics? Among the two types, which is more effective?

Usually, simpler codes that communicate a small set of organizational values (and motivate people to internalize and apply these values over a broad range of workplace situations) are more effective than extensive codes that try to mandate ad-hoc solutions to a long list of organizational situations

Describe three different moral philosophies and how each would impact an employee's decision in a business situation.

chapter 5

Some people focus on the means rather than the ends. They assess the ethicality of actions in and of themselves, removed from the potential outcomes of the actions. Which moral philosophy do these people subscribe to?

chapter 5

The moral judgment stage of the EDM process is affected by a variety of individual-level factors. Briefly list and describe any two individual-level factors that affect moral judgment.

chapter 5

When the CEO of Wells Fargo blamed a few bad employees in his organization for opening fraudulent customer accounts for personal gain, which of the two paradigms did he embrace?

chapter 5

Elizabeth Warren (US Senator from Massachusetts - remember the video shown in class?) made the case that Wells Fargo's fraudulent activities stemmed from a cut-throat culture of cross-selling. Which of the two paradigms did she subscribe to?

chapter 5 ---

As described during the Ford Pinto discussion, the competitive context has several deleterious effects on ethical decision-making. How exactly does a competitive context affect the ethicality of decisions made in that context?

competitive context: apart from unethical leaders, cultures and social narratives, even something as simple as the presence of strong competition can encourage moral exclusion and unethical behavior. Often times, people develop a mentality of "beating the other at any cost" when exposed to a strong competitive context

If a salesperson truthfully discussed the benefits of a product but avoided talking about the risks because he or she wanted the consumer to purchase it, what law would he or she be violating?

concealing facts

What is meant by the term 'ethical climate'?

ethical climate may be defined as a set of shared perceptions of procedures and policies, both codified and informal, which shape expectations for ethical behavior within an organization or a company

The Me-Too movement has gained a lot of traction in the last few years, with hundreds of cases of sexual harassment being disclosed across the country. Based on your team's research of the Me- Too movement, answer the following: - What are some of the main causes of sexual harassment at work?

power

define abusive supervision

sustained display of hostile verbal and nonverbal behaviors, excluding physical contact

define workplace deviance

when your peers engage in abusive behaviors

define hostile work environment

where repeated, unwelcome and offensive conduct create a work environment that a reasonable person would consider to be intimidating, hostile, or abusive

example of workplace deviance

· Unnecessarily interrupting or disrupting your work · Repeatedly discounting your statements in group meetings · Blaming you for problems you did not cause · Taking credit for your contributions · Spreading misinformation or malicious rumors about you · Purposefully inappropriately excluding, isolating, or marginalizing you from normal work activities

Employees are provided a variety of legal protections in the United States that can be traced back to basic societal expectations about how employees should be treated. What other laws were enacted to prevent discrimination based on other categories like age, pregnancy, disability and genetic information?

- The Americans with Disabilities Act (ADA) prohibits companies from discriminating based on physical or mental disability and requires companies to make workplaces accessible. For example, in my former workplace a hearing-impaired employee was hired. As a result, his office phone had to be switched to blink (rather than ring), and to automatically connect to an interpreter to accommodate his needs. Had we hired someone else for no other reason but to avoid making these accommodations, we would have been in violation of the ADA. - The Pregnancy Discrimination Act helps protect the rights of mothers and mothers-to-be in the workplace. Apart from these federal laws, others have been enacted to prevent discrimination based on age (i.e., over 40 years of age), and genetic information, among others. Take a look at the TedxTalk below by Renee E. Coover, an employment lawyer, about pregnancy discrimination. Did you know that it's illegal for potential employers to ask if you're planning to have kids? This gets asked all the time, but is a subtle form of discrimination.

explain bribery

- The practice of offering something, such as money, gifts, entertainment, and travel, in order to gain an illicit advantage from someone in authority - While attempts to bribe governmental officials aren't common in the US commercial bribery is a rather common practice in the business world - Cut and dry issue in most of the developed world, it is a rather complex issue for multinational firms that operate in emerging economies >> what's accepted in one societal context may be completely unacceptable in another

Describe the bad barrels argument in business ethics. How is it different from the bad apples argument?

- unethical leaders: abusive supervision, supervisor undermining, toxic leadership, leaders can also encourage corrupt and unethical acts within org, and foster unethical behaviors among followers by using rewards and ignoring unethical acts - unethical culture: when people enter unethical workplaces, they may look to others around them to learn the ropes and become acquainted with the norms and values of the organization. They may also mimic others' behaviors to become accepted within the company - social moral disengagement: people may create social narratives to justify their unethical actions (moral justification, euphemistic language, advantageous comparison, distortion of consequences, diffusion of responsibility) - competitive context: apart from unethical leaders, cultures and social narratives, even something as simple as the presence of strong competition can encourage moral exclusion and unethical behavior. Often times, people develop a mentality of "beating the other at any cost" when exposed to a strong competitive context

Describe the five types of leader power. Why are they important?

A key characteristic of ethical leaders is their use of power over others to enable the achievement of organizational goals. An ethical leader may use many different forms of power to motivate and direct the activities of others. - Reward power: stems from a leader's ability to bring about desired employee behavior by influencing monetary incentives (e.g., salary, performance bonuses, raises, etc.) and other valued job outcomes (e.g., vacation days, favorable job assignments, etc.). - Coercive power, on the other hand, stems from the leader's use of threats (e.g., threats of demotion, job loss, etc.) and actual punishments (e.g., loss of favorable job assignments, actual demotion, and termination of employment) to deter unethical conduct. This form of power mostly relies on fear to change human behavior. - Legitimate power (sometimes called titular or formal power) stems from the leader's position in the company. Because leaders occupies high levels in the organizational hierarchy, they are thought to have a 'right' to direct the activities of those below them. Followers may also perceive an obligation to abide by these directions from upper levels of their organizations. - Expert power stems from the leader's knowledge, experience and expertise. Bill Gates, for instance, was the founder of Microsoft and the creator of the first MS-DOS operating system, the precursor to the most widely-used operating system in the world today, Windows. Because of his deep expertise, people at Microsoft may defer to his judgment on technical matters, giving him a tremendous amount of power at the company. - Referent power comes from the followers' perception that leaders and followers have the same goals, and that any direction from the leader is in pursuit of these shared goals.

The Me-Too movement has gained a lot of traction in the last few years, with hundreds of cases of sexual harassment being disclosed across the country. Based on your team's research of the Me- Too movement, answer the following: - Why were sexual harassment issues so underreported in the past?

After watching Gretchen Carlson's TED talk on sexual harassment in the workplace, it is apparent that many incidents of workplace sexual harassment are rarely reported because of the retaliation victims my face. When a victim of workplace sexual harassment reports an incident that occurred, these individuals are often labeled as troublemakers and their reputation is trashed. These individuals are most likely to be demoted or fired after causing 'trouble' often leading to the end of someone's career.

Employees are provided a variety of legal protections in the United States that can be traced back to basic societal expectations about how employees should be treated. Briefly describe the key tenets of Title VII of the Civil Rights Act. What basic societal expectation does it uphold?

Apart from decent wages and a safe working environment, we all expect to be treated with dignity in the workplace and not be discriminated against in matters of employment. As we saw in our earlier discussion of ethics, Title VII of the Civil Rights Act of 1964 prohibits employment discrimination on the basis of race, national origin, color, religion, and sex. The short video below gives an overview of the law.

Workforce reductions are often undertaken due to poor financial performance. There are two distinct approaches to workforce reduction: downsizing and downscoping. Compare the two approaches. Which of the two is a strategic activity, and which is tactical in nature?

Companies have two major options when it comes to workforce reductions - downsizing and downscoping. Some firms may respond to financial issues by reducing the number of employees across different organizational functions. This tactical process of eliminating employment positions without changing the firm's overall business portfolio is called downsizing (also sometimes called rightsizing). On the other hand, some other firms may respond to poor overall performance by identifying specific areas of concern. They may then strategically spin off those specific areas, either by cutting the entire division or even selling off that division to another company that may be better at creating value. This strategic process of eliminating employment positions in specific business units to retain focus on the firm's core business is called downscoping.

Among the two types of ethical training programs in use, which is most effective at preventing wrongdoing?

Ethics training can be conducted using a variety of formats, from lectures and other theoretical training methods on one hand to real-life case studies and other tailor-made practical methods on the other. Normally, scenario-based practical training methods where participants make simulated decisions in real-life situations are much more effective than theory-based lectures. But that said, it is important for top management and HR leadership to motivate employees to engage in these training exercises - without employee buy-in, no ethics training program can be effective in the medium to long-term.

Describe the ways in which consumers may communicate their concerns regarding products or services to federal legislative bodies.

Federal Trade Commission (FTC) is tasked with collecting information from consumers and passing on this information to other administrative bodies and policy makers. If you have a complaint about a product or a service, or if you'd like to report fraud, identity theft or an unfair business practice, you'd start by contacting the FTC with specifics: https://reportfraud.ftc.gov (Links to an external site.). While the FTC cannot resolve individual complaints, it aggregates this information and passes it on to relevant agencies so that other agencies and policy makers can formulate laws and regulations.

What exactly does the consumers' "right to be heard" entail?

Finally, the Right to be Heard says that consumers have a right to communicate their grievances and concerns to policy makers and that legislators have a responsibility to listen to consumers. More specifically, people are assured that consumer interests will receive full and sympathetic consideration in government policy formulation, both through the laws passed by legislatures and through regulations passed by administrative bodies. Furthermore, legislatures and administrative bodies have a responsibility to collect information from consumers and act on consumer issues. - Federal Trade Commission (FTC) is tasked with collecting information from consumers and passing on this information to other administrative bodies and policy makers. If you have a complaint about a product or a service, or if you'd like to report fraud, identity theft or an unfair business practice - If you had a consumer complaint about a financial product, for instance, you could contact the CFPB (Consumer Financial Protection Bureau) in addition to filing it with the FTC. Consider the case of William (surname redacted for privacy) who contacted the CFPB for identity theft and debt collection issues

What exactly does the consumers' "right to choose" entail?

The Right to Choose implies that consumers should have the opportunity to select from a wide variety of products and services at competitive prices. The basic idea here is that fair competition in product markets can lead to the proliferation of high-quality products at reasonable prices, benefiting consumers, firms and the broader society in the long run. Antitrust activities like colluding on prices or production levels can jeopardize this consumer right and affect the broader society. A number of laws and regulations have been enacted to preserve this consumer right and prevent the breakdown of fair competition. - the sherman antitrust act - clayton antitrust act - federal trade commission (FTC) act

Describe the bad apples vs bad barrels argument as it related to ethical behavior in organizations

The bad apples argument is convenient for organizations because it is very easy to get rid of a few "bad apples" in the aftermath of a crisis to restore stakeholder trust. However, this "bad apples" approach is only one side of the story... As we all know, an apple may rot because it was placed in a "bad barrel." In fact, research in behavioral ethics has shown again and again that fundamentally good people can be capable of making highly unethical decisions when they are put in organizational contexts or pressured by situational forces. Good people can go on to ignore their own sense of morality and undertake decisions contrary to their value systems.

In the late 20th and early 21st century, massive workforce reductions negatively affected the employee-employer relationship. What macroeconomic factors caused these workforce reductions?

The oil crisis of 1973 and the ensuing recession caused many firms to wind down or cease operations. To complicate matters even further, rapid globalization subjected American firms to competition from around the world.

define psychological contract

What is the psychological contract? The term 'psychological contract' refers to individuals' expectations, beliefs, ambitions and obligations, as perceived by the employer and the worker. The concept emerged in the early 1960s and is core to understanding the employment relationship.

Workforce reductions have severe negative effects on long-term firm performance. Describe the negative effects of workforce reductions at the organizational-level and the individual-level.

While workforce reduction has some benefits (for example, it may enable firms to survive an economic downturn), it is also very costly. From a firm's perspective, downsizing and downscoping can lead to loss of organizational knowledge (information, experience and expertise). Knowledge in critically important areas may be inadvertently lost, leading to competitive disadvantage in the long run. From the individual's perspective, workforce reduction can not only affect our finances, but also affect our psychological well-being. A core part of who we are stems from what we do for a living. That is, our work-related identities are rather central to our self-schemas. When these work-related identities are threatened or lost, it triggers a psychological response. You may consciously or subconsciously distance yourself from your job, your organization and your coworkers, leading to low engagement, commitment, work performance, etc. You may go on to suffer stress and grief from losing an important part of yourself. And your self-esteem may be impacted temporarily until you are back on your feet.