1. Ethical Decision Making
Chapter 3
Ethical Decision Making

2. Chapter Objectives
To provide a comprehensive framework for ethical decision making in business.
To examine the strength of ethical issues as an important element influencing the ethical decision making process.
To introduce individual factors that may influence ethical decision making in business .
To introduce organizational factors that may influence ethical decision making in business.

3. Making Ethical Decisions
Making good ethical decisions to solve Ethical Dilemma requires a trained sensitivity to ethical issues and a practiced method for exploring the ethical aspects of a decision.
Having a method for ethical decision making is absolutely essential.
Ethical decision should be based on ethical principles and codes rather than on emotions, thoughts, fixed policies.

4. Habits of Strong Ethical Leaders
Ethical Leaders Have Strong Personal Character.
Ethical Leaders Have a Passion to Do Right.
Ethical Leaders Are Proactive .
Ethical Leaders Consider Stakeholders’ Interests.
Ethical Leaders Are Role Models for the Organization’s Values.
Ethical Leaders Are Transparent and Actively Involved in Organizational Decision Making.

5. Ethical Dilemma
Ethical dilemma: is a situation with uncertainty about what is right to do from a moral or ethical perspective.
For example, the manager of a company may be put in a position in which he must choose between the interests of his employees and his investors. Give more profits or increase the salary?

6. Ethical Decision Making Framework
The Framework Overview:
Step One: Describe the problem.
Step Two: Determine whether there is an ethical dilemma.
Step Three: Identify and rank the key values and principles.
Step Four: Gather your information.
Step Five: Review any applicable Code of Ethics.
Step Six: Determine the options.
Step Seven: Select a course of action.
Step Eight: Put your plan into action.
Step Nine: Evaluate the results.

7. Step One: Describe the problem.
You must first describe the problem and ensure that it’s actually a moral dilemma that needs to follow an ethical model.
Consider the nature of the problem and any signs of the problem and ensure that you’re attempting to solve the issue and not just it’s signs.
Circumstances affect the problem definition (for whom does the problem exist ? What is the surroundings?)

8. Step Two: Determine whether there is an ethical dilemma.
Terms of an ethical dilemma must be ethical in nature, not legal.
If something is a law, you then have the ethical choice to follow the law or not.

9. Step Three: Identify and rank the key values and principles.
What reasons can you provide for prioritizing one competing value over another?
Understand that a decision to a dilemma which goes against an individual’s personal set of values has very little chance of success.

10. Step Four: Gather Your Information
Do you have all the known facts?
Do you understand the applicable laws or legalities?
Do you have all relevant policies available to review?
Are you clear about the individual’s views and personal values?
* Don’t hesitate to seek out consultation.

11. Step Five: Review Any Applicable Code of Ethics
Look for the following:
-- Mission statement
-- Values base of the organization
-- Ethical principles to guide practice
-- Ethical standards
Codes can be revised or updated as needed.

12. Step Six: Determine the Options
List all possible actionable options.
Consider the cost/benefits of each option.
Seek out additional points of view.

13. Step Seven: Select a Course of Action
Remove the least desirable option.
Remove any which you can not put into action.
Remove any options which break the values systems of those affected.
Recognize that your final choice will be impacted by your personal values.

14. Step Eight: Put your plan into action.
Think about the outcomes with a sense that you have truly approached this ethical dilemma with the best of intentions and to the best of your ability.

15. Step Nine: Evaluate the Results
Evaluate the results for the future situations and ethical dilemma.
Consider submitting your most difficult cases to an ethics review board for feedback.

16. Ethical Dilemma Example 2 : (Assignment 1)
A new technology is being launched which is good for the company as well as the customers. But, if this is brought into use, a less employees is required for the organization.
The company is now in an ethical dilemma whether wants to satisfy the customers with good services or be loyal to the employees who have helped the company grow.
The unpleasantness of the situation arises when neither the customers nor the employees deserve to suffer and it is the comany’s call to take.

17. How Can Managers Encourage Ethical Decision Making?
Question: How can managers ensure that ethical issues are considered in business decisions?
To Encourage Ethical Decision Making, Firms Should:
Hire and promote people with a well grounded sense of personal ethics.
Refrain from promoting individuals who have acted unethically.
Potential employees should find out as much as they can about the ethical climate in an organization prior to taking a position

18. How Can Managers Make Ethical decisions?
2. Build an organizational culture that places a high value on ethical behavior.
highlight importance of code of ethics.
implement a system of incentives and rewards that recognize people who engage in ethical behavior and sanction those engage in unethical behavior.

19. How Can Managers Make Ethical decisions?
Develop a moral courage:
Enables managers to walk away from a decision that is profitable, but unethical .
Gives the employees the strength to say no to the manager who orders them to pursue actions that are unethical.

20. How Can Managers Make Ethical decisions?
4. Ethics Officers:
Ethics officers ensure that:
Employees are trained to be ethically aware.
Ethical considerations enter decision-making.
The company’s code of ethics is followed .