Chapter 10

Making it Stick: Doing What’s

Right in a Competitive

Market

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10-2

Key Components of an Ethics Policy

• Characteristics of a market• Demanding customers • Impatient stockholders• Aggressive vendors• Demanding federal, state, and local officials

demanding creditors• Aggressive competitors

10-3

Sustainable Ethics

• Ethical behavior that persists long after the latest public scandal or the latest management buzzword

• Stages in making ethical behavior sustainable • Establish a code of ethics• Support the code of ethics with extensive

training for every member of the organization

10-4

Sustainable Ethics

• Hire an ethics officer• Celebrate and reward the ethical behavior

demonstrated by your employees• Promote your organization’s commitment to

ethical behavior• Continue to monitor the behavior as you grow

10-5

Establish a Code of Ethics

• Well-written code of ethics can: • Capture what the organization understands

ethical behavior to mean• Establish a detailed guide to acceptable

behavior• State policies for behavior in specific situations• Document punishments for violations of those

policies

10-6

Establish a Code of Ethics

• Recommendations of the Institute of Business Ethics to create an ethics code• Find a champion• Get endorsement from the chairman and the

board• Find out what bothers people• Pick a well-tested model

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Establish a Code of Ethics

• Produce a company code of conduct• Try it out first• Issue the code and make it known• Make it work

10-8

Support the Code With Extensive Training

• Each department of the organization should apply the code to examples that could arise in their area where employees can work on:• Recognizing the ethical issue• Discussing options for an appropriate response• Selecting the best option for the organization

10-9

Hiring an Ethics Officer

• Ethics officer: Senior executive responsible for monitoring the ethical performance of the organization both internally and externally• Enforce the code of ethics and provide support

to any employees who witness unethical behavior• Sends a clear message to your stakeholders• Provides an appropriate person for employees and

their managers to turn to when they need additional guidance and support

10-10

Encouraging Ethical Behavior

• Celebrate examples of good ethical behavior in the company newsletter

• Award prizes for ethical behavior• Award prizes for new and creative ideas • Recognize employees who represent the

standard of behavior to which you are committing

• Declare an Ethics Day and allow every department to share their successes stories

10-11

Promote the Organizations’ Commitment to Ethical Behavior• Offer a no-questions-asked refund• Offer a 110% price-match guarantee • If the client is overcharged accidently, give them

a refund plus interest before their accounting department figures out the error and asks for the money

10-12

Promote the Organizations’ Commitment to Ethical Behavior• Get clients involved in the development of the

ethics policies• Let employees visit client sites to talk about the

code of ethics in person• Share success stories with all stakeholders• Invite stakeholders to the Ethics Day celebration

10-13

Continuous Monitoring

• Any organization’s commitment to ethical performance must be watched constantly

• Continued growth of technology will present new situations for ethical dilemmas so the code may need to be re-written on a regular basis

10-14

Becoming a Transparent Organization

• Result when organizations are driven by events and/or a fear of future events

Reactive ethical policies

• Result when the company develops a clear sense of what they stand for as an ethical organization

Proactive ethical policies

• Organization maintains open and honest communications with all stakeholders• Leads to the conclusion of the loss of market advantage through

corporate surveillance

Transparency

10-15

Organizational Integrity

• Characteristic of publicly committing to the highest professional standards and sticking to that commitment

• It is vital to earn the trust and confidence of the stakeholders for the long-term survival of the organization