Chapter 10 Ethical Leadership

Principles of ethical decision making _ Sales ethics form a code of moral conduct that guides sales managers and salespeople in their everyday activities . _ Ethical decision can be based on different moral Rules including the stakeholders and shareholders View , Idealism , relativism , self interest of Machiavellianism or conventional morality

Role Morality _ The moral Philosophy held by sales managers is important to maintain an ethical sale force because managers are the ethics teachers of their organizations as they select field salespeople , provide ethical training and enforce the moral codes of the firm

Role Morality _ We have two patterns of moral reasoning as : Relativism 2. Idealism

Role Morality _ Relativism : managers tend to reject universal rules and make decisions on the basis of personal values and the ramifications of each situation . _ Idealism : accept moral codes and believe that positive outcomes for all can be achieved by morally collect actions

Machiavellianism _ Focus on what’s rather than on what ought to be …. _Machiavelli denied the relevancy of morality in public life and regarded expediency _Machiavellianism defined as the principles and methods of craftiness Duplicity and Deceit

Conventional Morality _The Philosophy is reflected in Familiar phase “When in Rome , Do as Romans Do “. _This emphasis shift from the individual to what society thinks about the ethical issue _The standard of morality become what’s acceptable to others at a popular time and place .

Conventional Morality _ Problems with this approach : The majority may conflict with either the personal moral standards or with the company policy . 2. it’s difficult for managers to adapt to changing contexts or cultures

Making Decisions on ethical problems _ Ethics are concerned with the effect of actions on the individual , the firm , the business community and a society as a whole . _ Hierarchical diagram showing the order in which ethical decision evolve

Making Decisions on ethical problems _ we noticed that ethical values and standards of business Firms are derived from the general values and Norms of Society . Business Decisions Represent a synthesis of the moral and ethical principles embraced by various entities .

Making Decisions on ethical problems *Conflict is common because the value of the firm as interpreted by it’s executives mayn’t match the values held by the individual. * Job Description :Set of rules or practices that defines the role of an employee . It resembles a legal contract Because it specifies the number of hours of work , starting and stopping time and the goals that are to be accomplished

Ethical Checklist A comprehensive job description is a good 1st step , but managers often need practical Guidelines when making difficult moral Decision . _ we suggest a simple checklist when we confronted with an ethical Dilemma

Ethical Checklist Which contains : Recognize the Dilemma Get the facts List your opinion _ Are they legal ? _ Are they right? _Are they beneficial 4. Make your decision

Common Sales Ethics Issues Hiring and Firing :- _ Various Federal and state laws prohibit Discrimination in Hiring Practices . For example: In hiring candidates who are relative to officers of the firm , suppose a sale manager must choose between a man and a woman for a position although the man has more experience but as a woman is a daughter of a vice president of a company

Hiring and Firing So the woman will get the Job even though she has lower qualifications _ In this example the sale manager must make a moral choice between what’s the best for the firm and what might enhance his or her position in the firm

House Account _ A touchy problem for sales managers is how to handle large and important customers . _ These larger accounts require special attention that exceeds the time and the skills available from the salesperson assigned to the territory _Should these accounts be left with District salesperson or shifted to headquarters as House Account as these accounts Generate high commission income

Expense Account _ Most Ethical Abuse in a sales organization take place with expense account . Salespeople expected to spend money contacting customers and then reimbursed for their expenses . _ sales managers must decide how tight control on expense account should be.

Expense Account _ Tight control on expense account could result in salespeople not traveling to contact out of the way customer _ A good solution is to monitor the actual expense of some reliable salespeople for a month every year , as this approach reduce the cost of processing expense .

Gifts for Buyer _ Business has a tradition of giving small Gifts for buyers to express appreciation for past and future business . _ salespeople Give novelties and samples as well as seasonal Gifts _ Today purchasing manager appear to be willing to accept gifts of clothing , pen and calendars

Bribes _ A bribe was considered to be a personal Gifts to a buyer over 100$ One way to differentiate a Gift from a bribe is : When the item is unexpected (gift) rather than as a part of an agreed –upon payment for business (bribe)

Entertainment _ Providing Entertainment for customers is a standard practice in business , but it can lead to ethical problems . _ the issue is often (how much is too much ?) _ Most will agree that taking a customer to a lunch is fair few would argue against taking a client and Spouse to dinner and Night clubs

Sexual Harassment _ The equal employment opportunity commission define the sexual Harassment _ Unwelcome sexual advances , request for sexual factors and other verbal or physical conduct of sexual nature constitute sexual harassment .

Codes of Ethics _ Ethic policy statement : Indicates to sales force That the company believes in playing fair with customers and competitors . _Research has shown that salespeople employed in organization with codes of ethics perceived their work environment to have more positive ethical value than did other sales professionals

Ethics Training _ You should remember that simply publishing a sales ethics code does not Guarantee that field sales representatives will follow it _ company should offer classes to make sure that employees know what to do in morally situation

Ethics Training _ Research confirmed that younger sales managers are less idealism and more relativistic in their ethical decision making These findings suggest the importance of adjusting training programs content to meet the need of different age Groups

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