Ethics Class 4 and 5 and 6_Nicaragua_individual Level

7/27/2019 Ethics Class 4 and 5 and 6_Nicaragua_individual Level

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Social and Ethical

Responsibility of BusinessLeaders

Class 4-6

Ethics at the Level of the

Individual


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Why do people do bad

things?


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What do people do bad things?

They dont know it is bad when they are

doing it

It benefits them they are getting

something from it

They feel they have no option they are

afraid not to do it


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doing it


something from it


afraid not to do it


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What is BAD?How do you know the difference

between right and wrong?


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Please answer the following 3 questions

1. How ethical are you?

1 2 3 4 5Not at all ethical Extremely Ethical

2. How ethical was what Christopher Fort

Knox did to make the sale?

1 2 3 4 5Not at all ethical Extremely ethical


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Take away?

What are these data telling us?


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Take away?

Most of you believe you are ethical YET

there is wide variation in how you define

what ethical is


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World Class BullIs what Chris did to land his big

fish client OK?And, if not, at what point was it

not?


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What is the synopsis of

this discussion?


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We dont all agree on what it means to

behave ethically because

Ethics is relative?

We can agree to disagree?

Some people here are unethical

psychopaths?

Some people here are touchy-feely wimps

with no place in business?

There are not alway clear answers?


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Real World Ethical Situations are

Highly Complex Often There Will

Be NO Clear Answer

You may not even know you facedthem until it is way too late


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Are there some moral

senses we ALL share?


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Which is worse? To stick a pin in your hand

To stick a pin in the hand of a child you dont know?

Accept a wide screen TV from a friend who received it free of charge because ofa computer error

Accept a wide screen TV from a friend who received it from a thief who hadstolen it from someone else

Say something bad about your countr on a talk show in your country Say something bad about your country on a talk show in a foreign country

Slap a friend in the face, with his permission, as part of a comedy skit

Slap your priest in the face, with his permission, as part of a comedy skit

Watch some people drunk acting like idiots weaving and falling down

Watch some people drunk acting like idiots vomiting and peeing on the floor


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Accept a wide screen TV from a friend who received it from a their who hadstolen it from someone else

Say something bad about your nation on a talk show in your nation Say something bad about your nation on a talk show in a foreign nation

Slap a friend in the face, with his permission as part of a comedy skit

Slap your priest in the face, with his permission as part of a comedy skit


Watch some people drunk acting like idiots vomiting and peeing on thefloor


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Cross Cultural Moral Concerns:

The Primary Colors or Periodic

Table of the Moral Sense

The Big Five


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The five spheres of morality

are not only ubiquitous,they appear to have deep

evolutionary rootsImplemented in the brain as a

suite of moral emotions


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The Periodic Table of the Moral Sense

Harm That it is bad to harm others (And good to help others)

Fairness that one should reciprocate favors, reward benefactors and

punish cheaters Community/Group loyalty

That we value loyalty to the group, sharing solidarity among itsmembers and conformity to group norms

Authority That it is right to defer to and respect legitimate authorities

Purity That we admire/exalt purity, cleanliness and sanctity, while

loathing defilement, contamination and carnality


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So if these 5 moral sensesare universal, why do we all

react so differently?


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Because

Although the five moral senses are

universal and uncomplicated, the moral

situations you will face are unique and

very complicated

These five moral senses will come into

conflict with EACH OTHER (which one

wins)?


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Take away so far?

Sad Truth of Leadership is There will not always be right answers to

the situations you face

So if you think you can rely on gut instincts

or easy platitudes (do whats right), you aregravely mistaken


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Sad truth of leadership?

There will always be consequences to the

decisions you make


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If Chris were to think carefully about

the consequences of his actions

What might they be?


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Thinking about consequences

requires analysis of:

Who is involved?

What could happen? And then weighting the probabilities


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Stakeholder Analysis

The stake holder analysis is a practical,

realistic and powerful tool for thinking

through personal and professional

challenges It forces you to hold multiple perspectives; to

think deeply and carefully about the broader

social, political and economic contexts underwhich the situation you are facing might rest

Requires systematic critical thought (and data!)


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How to apply it?

Stake holder analysis:

Who are all the stakeholders holders

involved in the decision you are about to

make?

What are the consequences of your

proposed actions for each

Short term and long term, positive and

negative


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World Class Bull (B)What happened to

Christopher Fort Knox?


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In organizations, legal,

financial, competitiveanalyses are common,

clear and routineEthical decision get left up to

individualsYou must be prepared


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You are the leaders of the future

Your societies will depend onyou to make decisions that

benefit all stakeholders involvedTake this responsibility seriously

To whom much is given, much

is expected


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John F. Kennedy, 1963

A great society is one in which men and

women of business think greatly about

their functions, their responsibilities and

the consequences of their actions.


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Everyday you are going to bedoing things that impact the

lives of millionsIt is your responsibility as leaders

to think through them the best youcan


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For TomorrowClass 5 and 6


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doing it


something from it


afraid not to do it


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For Tomorrow:

Scandal in the First Year MBA

Why did the twins do what they did?

What should the MBA class do?

What could INCAE do to prevent such situations

for happening in the future?

A Brush with AIDS

What is the situation facing the protagonist? What should she do?

What could firms do to prevent such situations

happening in future?


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EthicsClass 5


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To sum up so far:

You all agree that you are ethical, yet

you disagree about what being

ethical is


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World Class Bull

As one short case illuminated, often:

There is no clear answer to what is right

We all differ in our opinions as to when and why a

decision/behavior is wrong You might not even be aware you faced a

moral challenge until it is far too late


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Lesson Learned?

Going forward in your leadership careers, you

can not blindly rely on your ethical

feelings/instincts/principles and/or vague

platitudes real life is too complicated You need to develop your ethical sensibility

You desire/ ability to sense the ethical dimensions to the

situations you face and the decisions/actions you take

You need tools and strategies to help you thinkcritically about the ethical situations you face


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Stakeholder Analysis

To the best of your ability, list all parties

who will be impacted by your decision

What are the consequences (negative and

postive, short and long term) of your

actions/decision on these

parties/stakeholders


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Maintaining Objectivitytests

Rule of Thumb Tests to avoid

decisions you may later regret


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Some good ones

Visibility/Transparency/Publicity

Generality

Legacy/Obituary Trusted Friend


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Youre WrongThere ARE right answersIt DOES all come down to principles/values

There are fundamental moral rights/wrongs

You should be teaching them


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Are there some primarymoral beliefs we ALL

can agree upon?


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Accept a wide screen TV from a friend who received it from a thief who hadstolen it from someone else

Say something bad about your country on a talk show in your country Say something bad about your country on a talk show in a foreign country

Slap a friend in the face, with his permission, as part of a comedy skit

Slap your priest in the face, with his permission, as part of a comedy skit


Watch some people drunk acting like idiots vomiting and peeing on the floor


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Accept a wide screen TV from a friend who received it from a their who hadstolen it from someone else

Say something bad about your nation on a talk show in your nation Say something bad about your nation on a talk show in a foreign nation

Slap a friend in the face, with his permission as part of a comedy skit

Slap your priest in the face, with his permission as part of a comedy skit


Watch some people drunk acting like idiots vomiting and peeing on thefloor


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Cross Cultural Moral Concerns:The Primary Colors or Periodic

Table of the Moral Sense

The Big Five


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The five spheres of morality

are not only ubiquitous,they appear to have deep

evolutionary rootsImplemented in the brain as a

suite of moral emotions


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The Periodic Table of the Moral Sense

Harm That it is bad to harm others (And good to help others)

Fairness that one should reciprocate favors, reward benefactors and

punish cheaters Community/Group loyalty

That we value loyalty to the group, sharing solidarity among itsmembers and conformity to group norms

Authority That it is right to defer to and respect legitimate authorities

Purity That we admire/exalt purity, cleanliness and sanctity, while

loathing defilement, contamination and carnality


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So if we all share these moralconcerns why is behaving

ethically so complicated?

Because many dilemmas you face

are ones in which these primary

moral senses conflict with one

another


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Right Versus Right

Challenges


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Lessons Learned, Revisited?

Going forward in your leadership careers, you

can not blindly rely on your ethical

feelings/instincts/principles and/or vague

platitudes real life is too complicated You need to develop your ethical sensibility

You ability to sense the ethical dimensions to the situations

you face and the decisions/actions you take

You need tools and strategies to help you think

critically about the ethical situations you face

You need support and guidance from the institutions

you work for


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Objective oftodays class?

To complicate things even further

Lets say you learned something. You agree.

The real world of ethics is more complicated

that you thought. You are prepared to try and

develop your moral sensibility, think critically

about the moral challenges you are going toface and make decisions that will balance

profit with values.


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What is going to stand

in your way?

YOU

Please Answer Following 2


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Please Answer Following 2

QuestionsWhat achievement in your life are you

most proud of?

Why did you decide to come to INCAE?


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What are you most proud of?

First girl with college education in my family

Making xxx my hobbyeven though I dont know

anything about it Overcome a difficult past to be a better person

Getting a job without help

Getting a big promotion at job

Being top student at my university

Graduating with honors

Getting into INCAE

Getting divorced from my husband

Graduating from college and working outside my

country

Becoming a father

Getting promoted at work

Getting into INCAE

Becoming financially independent

Being first woman boos

To be able to buy the first xxxx all my myself andalso the xxx of my dreams

Getting over fear of speaking in public

First person in family to get college degree

First person in class

Getting a great job

Why did you come to INCAE?

Change in career path

To grow professionally

To better myself To grow as an individual

Became INCAE is recognized by a lot of people and

it will help me in my future to go there

To get skills to have a better life style

To learn to be an entrepreneur

To get a good education and have LA point of view

I want to get a MA degree before I am 24

To make lives of my family better to repay them forall the effort they have made for me

Ill make more money

To move fast in my career

To build a strong network for myself

To make a lot of money so I can be a factor of

change

To improve my skills and make more money

To keep training myself to be a better leader

Will lend prestige to my career

For status and making money

To be able to move professionally and make more

money

Get more money


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What are you most proud of?

1. First girl with college education in my family

2. Making xxx my hobbyeven though I dont know

anything about it3. Overcome a difficult past to be a better person

4. Getting a job without help

5. Getting a big promotion at job

6. Being top student at my university

7. Graduating with honors

8. Getting into INCAE

9. Getting divorced from my husband

10. Graduating from college and working outside my

country

11. Becoming a father

12. Getting promoted at work

13. Getting into INCAE

14. Becoming financially independent

15. Being first woman boos

16. To be able to buy the first xxxx all my myself andalso the xxx of my dreams

17. Getting over fear of speaking in public

18. First person in family to get college degree

19. First person in class

20. Getting a great job

Why did you come to INCAE?

1. Change in career path

2. To grow professionally

3. To better myself4. To grow as an individual

5. Became INCAE is recognized by a lot of people and

it will help me in my future to go there

6. To get skills to have a better life style

7. To learn to be an entrepreneur

8. To get a good education and have LA point of view

9. I want to get a MA degree before I am 24

10. To make lives of my family better to repay them forall the effort they have made for me

11. Ill make more money

12. To move fast in my career

13. To build a strong network for myself

14. To make a lot of money so I can be a factor of

change

15. To improve my skills and make more money

16. To keep training myself to be a better leader

17. Will lend prestige to my career

18. For status and making money

19. To be able to move professionally and make more

money

20. Get more money


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What lessons to belearned from these

data?Why are these lessons relevant

to this ethics class?


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You are BIASED

A cognitive bias is a pattern of deviation in judgment that occurs inparticular situations, which may sometimes lead to perceptual

distortion, inaccurate judgment, illogical interpretation, or what is

broadly called irrationality.[1][2][3] Implicit in the concept of a "pattern

of deviation" is a standard of comparison with what is normatively

expected; this may be the judgment of people outside thoseparticular situations, or may be a set of independently verifiable

facts. A continually evolving list of cognitive biases has been

identified over the last six decades of research on human judgment

and decision-making in cognitive science, social psychology, and

behavioral economics.
http://en.wikipedia.org/wiki/Biashttp://en.wikipedia.org/wiki/Irrationalityhttp://en.wikipedia.org/wiki/Facthttp://en.wikipedia.org/wiki/List_of_biases_in_judgement_and_decision_makinghttp://en.wikipedia.org/wiki/Cognitive_sciencehttp://en.wikipedia.org/wiki/Social_psychologyhttp://en.wikipedia.org/wiki/Behavioral_economicshttp://en.wikipedia.org/wiki/Behavioral_economicshttp://en.wikipedia.org/wiki/Social_psychologyhttp://en.wikipedia.org/wiki/Cognitive_sciencehttp://en.wikipedia.org/wiki/List_of_biases_in_judgement_and_decision_makinghttp://en.wikipedia.org/wiki/Facthttp://en.wikipedia.org/wiki/Irrationalityhttp://en.wikipedia.org/wiki/Bias


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How (Un)Ethical are you?

Illusion of objectivity

Implicit prejudice bias that emerges fromunconscious beliefs men are better leaders

In-group favoritism biases that favors yourgroup special attention to those that you know

Bias that favors you


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Such biases are:

Widely prevalent

Robust even when you try and control

them

Contrary to conscious intention

Costly/dangerous

Amplified by the external pressures/normsthat you will face in the real world


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You expect to see a

beautiful white vase


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You expect to see two

blue faces staring at

each other


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You expect to see a

beautiful young womanShe is looking over her shoulder


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You expect to see an

ugly old hagWith a big nose

And thin lipsAnd a long pointy chin


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You want to buy arectangular table for

your newrectangular dining room

Which one will you buy?


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You are really good at

paying close attention to

peoples behaviorsIn the video that follows, how

many times did the players in

WHITE pass the basketball

(most count incorrectly)


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http://www.youtube.com/watch?v=IGQmdoK_ZfY

Thembusinessillusion
http://www.youtube.com/watch?v=IGQmdoK_ZfYhttp://www.youtube.com/watch?v=IGQmdoK_ZfYhttp://www.youtube.com/watch?v=IGQmdoK_ZfY


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Take away?

We all have biases that can blind us from

seeing the real world (and ourselves)

correctly


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All of you smart, competitive, driven

want to succeed

System encourages it, your families

encourage it, INCAE encourages it, thecompanies you will work for do as well

Your own unconscious biases encourage it!

To accomplish your goals, what might you be

capable of?


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Scandal in the MBA

Accused Parties

What did the Jones twins do?

Why did they they do it?

What kind of rationalizations did they

make to themselves while they were

doing it?


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Lessons learned?

S


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Scandal in the MBA

Enablers

Why did witnesses choose to report it

anonymously?

What should the class do?

What could INCAE (and other

organizations) do to prevent such things

from happening in future?


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Lessons learned?


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You want desperately to get ahead

Is there a way to turn being

ethical into a competitive

advantage?


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A Brush With AIDS (A)Courage as a Skill

What is situation facing protagonist?

Whos fault is this situation? Should she take the product off the market

and re-tool?

Pros and Cons

Is there a way for her to balance economic

pressures/realities with ethical concerns and

responsibilities?


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What is a Sharps

container?

What does the market for a

Sharps container look like at the

time of the case?


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Who is she?

Why does she work at Halsey?


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What is Halseys

mission?

How are employees evaluated?

What is emphasized?


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At start of case, how is shedoing with her sales targets

for the year?

A B h ith Aid (A)


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A Brush with Aids (A)

What is a Sharps Container? What does the market for Sharps containers look like at the time of the

case? After 1987 incident CDC and OSHA required that sharps containers be placed in

every hospital room

Market opportunity for 109 million containers, up 810%

Halsey had 35% of market

Customers willing to pay any price profit margin 45% Lots of competition

Who is she?

What is the company mission? About customers (quality and commitment)

How are employees evaluated

Short term performance measures (they are committed to making profit plan) At start of case, how is she doing with her 1989 sales target?

Yearly bonus of 10,000 increases 1% for every 1% she surpasses her salestarget

She is about to surpass target by 8.2 million


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What is the problem she

is confronted with?

What is the problem she is


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p

confronted with?

Customers complaining sporadically aboutproduct failure

Plastic is shattering in cold temps and

needles could penetrate Plastic is not thick enough

How could the problem be solved?

H ld bl b l d?


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How could problem be solved?

Increase thickness of plastic


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If you were her, at that

moment in time when the

case ends, would you recallthe product and have it

retooled?

Reasons to do nothing?


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Reasons to do nothing?

Containers fail in only 1% of cases At what point does a product have to be good enough?

Even if it fails, what are odds of person getting AIDs?

Product meets OSHA and CDC requirements

No other companies (competitors) are doing anything

Huge profit losses for company Four months of inventory that could not be sold

(7,200,000 dollar right off)

Need to expand mold 16mold, each 25K to retool, 128K profit hit

Increase in raw materials

Huge profit losses for her

Profit losses for her boss Bonus is 25K to meet target (will lose 75% if he does not)

Reasons to do something?


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Reasons to do something?

Hearing Keep up good work is freakingher out

She feels she is not showing commitment

to customers or mission

Possible serious health ramifications

What is someone gets pricked and gets AIDs?

Risk of hurting company reputation

Hurting market share

Who are stakeholders involved? What are possible


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p

consequences of her decision for each one?

Her Phil

Corporate executives/senior management

Sales reps

Hospital buyers

Health care workers And their families

Shareholders

Health care products industry

Society at large

Media

Competitors


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What DID she do???

What did she do?


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What did she do?

Decided product needed to be retooled Asked sales reps: 50% of 325 sales reps said

product needed to be retooled

Went to bosses did not appeal to mission or

morality but by emphasizing economic picture Cost Benefit analysis

Negative short term losses

Positive could be first to introduce a high quality product toa cost insensitive market

Reactions from bosses?


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Reactions from bosses?

Phil said wait 6 months She said no, carefully raised companys

mission statement

Vice president agreed with her Senior management recognized that company

mission statement held no meaning for linemanagers who were compensated for

conflicting goals/objectives The following year quality measures (although

loose) became part of performance measures

Take away?


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Take-away?

She managed to balance the conflictingforces (economic versus ethical) to arrive

at a workable solution

One that benefited her, the company, theshareholders and the customers

Case illustrates:


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Case illustrates:

Young managers approach to handling anethical conflict

She managed to balance the conflicting

forces (economic versus ethical) to arrive at aworkable solution

It is through the process of addressing

such conflict and tension that greatleadership emerges and organizational

values are shaped over time

Review


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Review

The point of this ethics class is not to createvalues or change values it is to teach you tothink A great society is one in which men and women of

business think greatly about their functions,

responsibilities and the consequences of theiractions

To help develop and enhance your: Ethical sensibility

Moral reasoning skills Desire and will to act ethically in the face of moral

conflicts

Ethics Class 4 and 5 and 6_Nicaragua_individual Level

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Transcript of Ethics Class 4 and 5 and 6_Nicaragua_individual Level