ETHICAL DECISION MAKING ORGANIZATIONS

The issue of ethical decision making in organizations has received much attention in recent years for a variety of reasons: the post-Watergate atmosphere, mounting public scorn regarding business behavior, and manager’s cynicism and internal personal-work values conflicts (Brenner & Molander, 1977; Crittenden, 1984; Ingersoll & Pound, 1984, Lincoln, Pressley, & Little, 1982; Rickless, 1983).

Interactionist model of ethical decision making in organizations

Retrieved from March 2011:

http://worldroom.tamu.edu/Workshops/CommOfRespect07/MoralDilemmas/Ethical%20Decision%20Making%20in%20Organizations.pdf 

Ethics in an organization refers to rules (standards, principles & values) governing the conduct of organizational members and the consequences of organizational decisions.

The organizational ethics can be classified as:

- Defining appropriate behavior.

- Establishing organizational values.

- Nurturing individual responsibility.

- Providing leadership & oversight.

- Relating decisions to stakeholder interests.

- Developing accountability.

- Relating consequences.

- Auditing & improvement.

 The ethical decision making can support the organization in aspects as:

- Culture, values and programs.

- Compliance and leadership.

- Recognition of the role of co-workers and managers.

- Balancing stakeholder interests.

- Management of situational pressures.

- Rewards beyond short-term performance.

Qualities Required for Ethical Decision Making:

- The competence to identify ethical issues and evaluate the consequences of alternative courses of action.

- The self-confidence to seek out different opinions about the issue and decide what is right in terms of a situation.

- Tough mindedness: the willingness to make decisions when all that needs to be known cannot be known and when the ethical issue has no established, unambiguous solution.

Ethical Behavior

* Individual Influences

* Value systems

* Locus of control

* Machiavellianism

* Cognitive moral developmen

Organizational Influences

* Codes of conduct

* Norms

* Modeling

* Rewards and punishments

People judge themselves based on their intentions, but others are judged based on their behavior, so an individual accountability in an organizational setting is necessary.

"A personality characteristic indicating one’s willingness to do whatever it takes to get one’s own way" 

(Niccolò Machiavelli)

What are the impacts of culture in terms of mixed-motive decision making?

Decision making is a contemporary problem facing many businesses. The culture influence on the industrial procurement manager's perception of the different characteristics of potential global sourcing locations, with a view to integrating the influence of culture operating at different levels into a global sourcing location decision framework; thereby enhancing managerial insights to the role played by culture in making decisions.

For example, the procurement managers select regions for low-cost sourcing based on both specific measures and individual and/or group perceptions of the region, whether these perceptions are correct or not. The cultural orientation impacts geographical perceptions which in turn impact criteria ratings of locations.

The culture is viewed as a fundamental decision-making construct.

Sources

Klebe Trevino, Linda. The Academy of Management Review, Vol. 11, No. 3. (Jul. 1986), pp. 601-607.

JOURNAL OF BUSINESS ETHICS. Volume 13, Number 3, 205-221, DOI: 10.1007/BF02074820

Robert C. Ford and Woodrow D. Richardson. Ethical decision making: A review of the empirical literature.

THE CORPORATION

The Corporation. Retrieved from March 2011: https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjruM7P3eEcu0GQCckRB_ZKZprONd9rahAGKrcQJ0-AGOzJHft0lgXoVbUcIMMVrZ16kpymRimsnSwVt1o_4qw7pQmM8W5ON8w1Ot7MAuAKP3_pQmGOZ3JuHCTFftGF-jPVz31rJ_nYNe3d/s1600/41980_the_corporation.jpg

Capitalism

Economic system in which property is privately owned and goods are privately produced. It is sometimes referred to as the private enterprise system.

Capitalism is a social system based on the principle of individual rights.

Retrieved from March 2011: http://dailycensored.com/2010/05/31/the-death-of-capitalism/

Psychopath

First described systematically by Medical College of Georgia psychiatrist Hervey M. Cleckley in 1941, psychopathy consists of a specific set of personality traits and behaviors. Superficially charming, psychopaths tend to make a good first impression on others and often strike observers as remarkably normal. Yet they are self-centered, dishonest and undependable, and at times they engage in irresponsible behavior for no apparent reason other than the sheer fun of it. Largely devoid of guilt, empathy and love, they have casual and callous interpersonal and romantic relationships. Psychopaths routinely offer excuses for their reckless and often outrageous actions, placing blame on others instead. They rarely learn from their mistakes or benefit from negative feedback, and they have difficulty inhibiting their impulses.

Legal institution

Systems of legal rules which allow to change the regulative and 

constitutive rules of an organization.

“Systems of [regulative and constitutive] rules that provide frameworks for social action within larger rule-governed settings” (Ruiter, 1997) (1)

Externalities

Externality is a situation that occurs when the benefits or private costs entitled to the producers and consumers of a product are different from the consuming the product . These situations occur when the outcomes of an individuals actions affects another individuals well being . The affected person according to the existing property rights in the society is not entitled to any payment .

Externalities of either the "positive" or the "negative" sort create a problem for the effective functioning of the market to maximize the total utility of the society. The "external" portions of the costs and benefits of producing a good will not be factored into its supply and demand functions because rational profit-maximizing buyers and sellers do not take into account costs and benefits they do not have to bear.

Limited liability

Limited liability refers to the terms of limited partnerships, which comprise at least one general partner, who takes on unlimited liability, and one or more limited partners, who would never lose more than their original initial investment in fulfilling the partnership's obligations. Limited liability protects a partner's personal assets from being liquidated should the company become insolvent. 

A Limited Liability Company (LLC) is a business structure allowed by state statute. LLCs are popular because, similar to a corporation, owners have limited personal liability for the debts and actions of the LLC. Other features of LLCs are more like a partnership, providing management flexibility and the benefit of pass-through taxation.

In this documentary, corporations are defined as “legal entities” and they meet the clinical definition of psychopathic behavior. Do you agree, why, or why not?

Corporations are legal entities, like people. They enjoy all the rights afforded under the bill of rights, by virtue of a court’s interpretation of the 14th amendment in the late 19th century (Santa Clara County vs. Southern Pacific Railroad Company). Unlike people, corporations are immortal and have only one consideration influencing their behavior, profit.

In psychiatry there is a diagnostic entity variously known as psychopath, sociopath and antisocial personality disorder. The central feature of this disorder is the failure to develop any ethical standards of social behavior, The concept of "do unto others as you would have them do unto you" is foreign to the psychopath. That remarkable advice is replaced by "do unto others as it pleases you regardless of consequences." We do not know for sure the cause of such behavior, whether it is genetic in origin, the result of early developmental trauma, or a combination of the two. The outstanding feature is that the psychopath has a natural talent for using and exploiting others and does so with such skill that true motives remain concealed by ingratiating ways and apparent normality. At some point the bubble bursts and the victim awakens to the reality that they have been taken.

A corporation has been endowed with personhood by the Supreme Court. It is not a person but it is run by persons. If the ethical standards of those at the top fail to maintain a certain level of social responsibility, the result is the insidious onset of corporate psychopathic behavior. A few get very rich and the others wake up one day to find themselves abandoned by the institution they trusted. We now have to take into account the corporation as a psychopathic entity outfitting all prior attempts on the part of governmental regulating agencies to control its behavior.

If you want to see the complety documentary, click here: 

http://www.youtube.com/view_play_list?p=FA50FBC214A6CE87

Sources:

1. D.W.P. Ruiter. A basic classification of legal institutions. Ratio Juris, 10(4):357–

371, 1997.

http://www.mcwdn.org/ECONOMICS/EcoGlossary.html

http://www.scientificamerican.com/article.cfm?id=what-psychopath-means

http://www.cs.unipr.it/CILC04/DownloadArea/BoellavdT-CILC04.pdf

http://www.mightystudents.com/essay/Externalities.Business.Organizations.158686

http://siivola.org/monte/papers_grouped/uncopyrighted/Misc/corporate_psychopathy.htm

ORGANIZATIONAL MOTIVATION

MOTIVATION

There are several studies and research carried out by scholars from different disciplines (e.g. sociology, psychology, economy and management) aiming to explain, predict and influence behavior. This set of studies is called Motivation Theories.

Retrieved from March 2011: http://www.procrastinationsolution.com/uploaded_images/MotivationTraining-719547.gif

There are two main approaches to motivation theories (Ramlall, 2004) (1):

Focus on Internal Needs: explaining behavior as the result of a person’s inner values, attitudes and conception of the world. For example, Max Weber explained the searching for profit in advanced capitalist countries as the result of widespread protestant ethicswhich encourages hard work and need for achievement as a means to gain redemption (Bell, 1996). (2)

Focus on External Incentives: explains behavior in terms of external stimuli to the people’s actions. For example, Adam Smith spoke about the invisible hand that guided the individuals’ actions toward making profit benefiting in that process the growth of the entire economy (Bishop, 1995). (3)

Another theories are:

- Maslow's need hierarchy

- McGregor's Theory X and Theory Y

- Herzberg's two-factor theory

- Alderfer's ERG theory

- McClelland's need theory

Need-based approaches to Motivation

Need-based approaches to motivation focus on what motivates employees to choose certain behaviors as shown on the following diagram.

Retrieved from March 2011: http://courses.washington.edu/inde495/lece.htm

In multicultural organizational contexts what could be a good strategy to keep people motivated towards a common task?

The most important and main strategy is the respect and recognition, because a multicultural organization represents a diversity of personalities and behaviors. The organization have to create an friendship enviroment.

Everybody have a different needs, and Individuals are motivated if their needs are met.

Sources:

1. R

amlall, S. (2004).A Review of Employee Motivation Theories and their Implications for Employee Retention within Organizations. Journal of American Academy of Business, Cambridge, 5(1/2), 52-63.

2. Bell, Daniel. (1996).The Protestant ethic. World Policy Journal, 13(3), 35-39.

3. Bishop, John D. (1995). Adam Smith's invisible hand argument. Journal of Business Ethics, 14(3), 165.

* 

http://courses.washington.edu/inde495/lece.htm

PERSONALITY, PERCEPTION & ATTRIBUTION; ATTITUDES & VALUES

Personality, Perception and Attribution

"Personality, perceptions and attributions are subjects of analysis of the so called Interactional Psychology, which is the study of the individuals’ patterns of interaction in a given structure and environment" (Terborg, 1981)(1).

Retrieved from March 2011: http://careersdonewrite.com/blog/secrets-to-personal-branding-for-professionals.html

Many authors have defined personality in slightly different ways, but after collating from 50 different definitions, Allport (1937) offered his own definition of Personality: “Personality is the dynamic organization within the individual of those psychophysical systems that determine his unique adjustments to his environment” (2)

Retrieved from March 2011: http://books.google.com/books?hl=es&lr=&id=QD5S-uoERRoC&oi=fnd&pg=PA351&dq=Personality&ots=Q0fGzZbsWe&sig=b6UUp9PrAIyf9p7msbUIXqNnSXs#v=onepage&q&f=false

The personality is determinate by some factors, as: Cultural influences, Family and social groups and Situation and behavior.

In addition, there are a lot of traits, and the most important are the “Big Five” Personality traits:

-         Surgency and Extraversion.

-         Agreeableness

-         Conscientiousness

-          Neuroticism and Emotional stability

-          Openness to experience and Intellect

Each person understand, feel and see the world in a particular way. The Perception is reflected in the way that a person act and behave. Peter Lindsay and Donald A. Norman said “Perception is the process by which organisms interpret and organize sensation to produce a meaningful experience of the world… perception in humans describes the process whereby sensory stimulation is translated into organized experience.”

Retrieved from March 2011: http://darmano.typepad.com/logic_emotion/images/2008/10/16/perception.jpg

Attributions are assumptions about the nature of the environment, of oneself and of the people with whom one interacts. As they are personal assumptions, it is likely that any attribution falls into biases. Fundamental attribution error consists of assuming that the other’s errors are determined by the internal structure and characteristics of people. Self-serving bias is the tendency to define personal success in terms of internal causes, and failures in terms of external factors (Inamory, 2010). (3)

Attitudes and values

Morse and Young (1973) said: “The individual faces the autonomy dilemma when he (or she) realizes that he (or she) has the ability to submit to parental demands or withhold the behavior which will please his parents. If the individual derives pleasure from failure to submit to parental demands, the emerged tendency will be strong desire for autonomy and a need to defy authority figures and restrictions: this is a keystone in the development of the attitude toward authority".

The Attitudes are formed, the individuals are not born with the attitudes. Also means that attitudes are reflected in our actions and reactions.

The OB studies are related with work-related attitudes and behavior. The employee’s attitude for job can affect the satisfaction, and the commitment with the organization.

A Value is an enduring belief that a Specific mode of conduct or end-stated of existence is personally and socially preferable to an opposite or converse mode of conduct or end-state of existence. A value system is an enduring organization of beliefs concerning preferable modes of conduct or end states of existence along continuum of relative importance. (Rokeach, 1973)

Values provide the base for understanding an individual’s attitudes, perceptions and personality, that’s why, is an important issue that explains the behavior of a person.

To what do you attribute the success of JICA?

The JICA (Japan International Cooperation Agency), is a generous and free aid agency Japanese, that works to reduce poverty.

JICA offer help in Colombia, some countries of Africa and Mongolia.

The succes of JICA are based in its support of the weakest (socially) and its great contribution to built the World Peace.

JICA have 30 volunteers in Colombia, and have 4 in Medellin (change each 2 years), and is is funded by the Japanese government, that provides food, rent and transport for people with low incomes. But Japan doesn't have a lot resources, and need the help of other countries, "I give and I recieve, to survive" (Foreign policy).

Sources:

1. Terborg, J. (1981). Interactional Psychology and Research on Human Behavior in Organizations. Academy of Management Review, 589-576.

2. Allport, Gordon W. (1937). Personality: A psychological interpretation. Personality; Characters and characteristics, p. 48.

3.    Inamori, T., & Analoui, F. (2010). Beyond Pygmalion effect: the role of managerial perception. Journal of Management Development, 29(4), 306-321.

*  Peter Lindsay & Donald A. Norman: Human Information Processing: An Introduction to Psychology, 1977.

*  P. Chelladurai. Human resource management in sport and recreation. Human Kinetics, (217). [on line] http://books.google.com/books?id=THa2M91b938C&pg=PA66&lpg=PA66&dq=%E2%80%9CPersonality+is+the+dynamic+organization+within+the+individual+of+those+psychophysical+systems+that+determine+his+unique+adjustments+to+his+environment%E2%80%9D&source=bl&ots=itm_4quhEM&sig=14ZMTCkczyeJQ8OqHhS8Y-EtSjs&hl=es&ei=0ld5TdiCL-rj0gG6z7nvAw&sa=X&oi=book_result&ct=result&resnum=1&ved=0CBYQ6AEwAA#v=onepage&q=%E2%80%9CPersonality%20is%20the%20dynamic%20organization%20within%20the%20individual%20of%20those%20psychophysical%20systems%20that%20determine%20his%20unique%20adjustments%20to%20his%20environment%E2%80%9D&f=false