Chapter 3 The Manager's Changing Work Environment & Ethical Responsibilities
Who should the company be responsible to?
1. Internal stakeholders 2. External stakeholder
Employees, owners, board of directors etc these people have a direct effect on the overall success in the businessss
1. The general environment 2. The task environment
The people who interests are affected by an organization's activities.
Consists of 1.customers 2. Competitors 3. Suppliers 4.distributors 5. Strategic allies 6. Employee organizations 7.local communities 8. Financial institutions 9. Government regulators 10. Special-interest groups 11. Mass media
Those who pay to use an organization's goods and services. A lot of times they value
People or organizations that compete for customers and resources
A person or an organization that provides suppliers- that is raw materials , services, equipment, labor, or energy to other organizations.
A person or an organization that helps another organization sell its goods and services to customers; the internet has helped some manufacturers sell directly to the public.
Describes the relationship of two organizations that join forces ( include competition) to achieve advantages neither can perform as well.
Employee Organizations: Unions & Associations
Unions: that represent hourly workers (Auto workers); steadily declined in recent years.
Professional organizations: Represent salaried workers (Newspaper guild)
Important stakeholders especially their reaction to the company moving in (or out); local governments use this a tax base, families & merchants for their businesses.
When a local government rescinds ( takes back) the tax break when firms don't deliver promised jobs.
Banks, savings & loans, and credit unions fund businesses with loans, but with the economic times even people with good credit couldn't secure a loan ( to tide them over when revenues or down or to fund new projects).
Regulatory agencies that establish ground rules under which organizations may operate.
ex local & state regulators, WTO, foreign governments, FAA
Special- Interest groups
Groups whose members try to influence specific issues.
ex MAD, NOM, NRA etc.
Print, Radio, Tv & the internet influences; many companies have a special department to deal with this force.
Consist of the general economic traditions and trends (that the organization has no control over) that may affect an organization's performance. a) Unemployment: more applicants, but less potential for growth b) Inflation: Less discretionary income for all c) Interest Rates :Borrowing gets more expensive d) Economic Growth : More opportunities
ex The Great Recession of 2007-2009; economy becoming more polarized
New developments in methods for transforming resources into goods or services; making things obsolete quickly; creates a high-tech society
ex the Internet & biotechnology
Influences and trends originating in a country's, a society's, or a culture's human relationships and values that may affect an organization.
ex less cigarettes, whiskey , red meat & eggs. Increase in athletic shoes, spandex,diets.
The influences on an organization arising from changes in the characteristics of a population, such as age, gender, or ethnic origin. ex marriage rate down, intermixing of races, etc.
Political- Legal Factors
Changes in the way politics shape laws and laws shape the opportunities for and threats to an organization. ex whatever party is in power will effect how a law is brought about. Also suing your competition
Changes in the economic, political, legal, and technological global system that may affect an organization.
ie a flatter, smaller, interconnected world
A situation in which you have to decide whether to pursue a course of action that may benefit you or your organization but that is unethical or even illegal.
The standards of right and wrong that influence behavior; very subjective, varies between countries & cultures.
The patterns of values within an organization
The relatively permanent and deeply held underlying beliefs and attitudes that help determine a person's behavior.
Sometimes the values of an individual and the organization differ, leading to conflict.
The Greatest good for the greatest number of people.
ex efficiency, profit, firing lots of employees to improve bottom line and the stakeholders.
Achieving the individual's best long-term interests, which are ultimately in everyone's self-interest. This is not always the case however
ex Short term ethics leads to long-term success, pollution from farm affects fishing industry.
Guided by respect for the fundamental rights of human beings
ex U.S.'s bill of rights.
Guided by respect for impartial standards of fairness and equity.
ex laws are carried out fairly. Ceo pay hot button issue.
The illegal tradition of a company's stock by people using confidential company information.
Using cash from newer investors to pay off older ones.
Sarbanes- Oxley Act of 2002 (SarbOx or SOX)
Established requirements for proper financial record keeping for public companies and penalties of as much as 25 years in prison for noncompliance.
Ie makes the CEO personally certify the company's financial statments
Laurence Kohlberg's 3 levels of moral development
Level 1 Preconventional- follows rules Level 2 conventional- follows expectations of others Level 3 Post-conventional- guided by internal value
1. Creating a strong ethical climate 2. Screening ethics codes & training programs 3. Instituting Ethics codes & training programs 4. Rewarding Ethical Behavior (Protecting Whistle Blowers) ; a lot of companies now haze a chief ethics officer.
Represents employer's perceptions about the extent to which work environments support ethical behavior. ( policies, procedures, and practices)
Code of ethics
Consists of a formal written set of ethical standards guiding an organization's actions. Ie how to treat stakeholders
Am employee who reports organizational misconduct to the public. (health, safety, corruption etc); may sometimes receive an award
Being a good 'corporate citizen' ; it is also the manager's duty to take actions that will benefit the interests of society as well as the organization
Corporate social responsibility
The notion that corporations are expected to go above and beyond following the law and making a profit. Ex going green, sustainability etc.
1. Classical view 2. socio-economic View
Making charitable donations to benefit humankind
ex Zuckerberg's 100 mil to NJ school system Bill Gates stepping down as CEO to work on his foundation
Maximize profits are the only responsibility of the corporation
Goals that go beyond profits and needs to focus, protect, and improve society.
a) Sustainability b) philanthrophy
Meeting the needs of the present without sacrificing the needs of the future.
Archie B carroll's corporate social responsibility pyramid
1. Customers more apt to purchase from them 2. Workers are more efficient, loyal & creative 3. Effects the quality & retention of best employees 4. Improves overall sales growth 5. Affects company efficiency 6. Can lead to legal fines 7. Affects stock price 8. Effect on profits
The system of governing a company so that the interests of corporate owners and other stakeholders are protected.
This represents how people are similar & different 1. Personality 2. Internal Dimensions 3. External Dimensions 4. Organizational Dimensions
Stable & mental characteristics responsible for your identity
Things you carry with you that are part of you ex gender, race, physical abilities, age, ethnicity, sexual orientation
Things that you acquire in your life experience ex education, marriage, geographic location, economics, stereotypes
Where you are in the career ladder ex seniority, division
Trends in Diversity
1. Age 2. Gender 3. Race 4. Sexual Orientation 5. Physical & Mental Disabilities 6. Education Levels
As a whole America is getting older, people are living longer, and a crappy economy (which makes people work longer)
The majority of women in big cities actually make $6000 more than their male counterparts. Due to the information age, jobs nowadays are based on brain power not physical attributes like strength.
By 2020, there will be no majorities in the United States
6.4% of the population; follow the money, fight for rights at the tipping point
Physical & Mental Disabilities
No longer stigmatized & considered normal
College today is the equivalent to a high school degree To move up the corporate ladder, graduate school is almost a requirement. ex underemployment 26.7%; 1 in 4 Americans are underemployed
Alvon Tofler's "waves"
1. Agricultural Wave 2. Industrialization 3. Information Wave
200 years ago, every society in the world was in this age.
1820's in Europe 1870's in America (Because of the civil war)
1970's- now The age of the employee, the best people can not be replaced ie Knowledge is power