1. Chapter 5 Ethical Issues in Services Marketing

2. FACTORS CONTRIBUTING TO CONSUMER VULNERABILITY
Few search attributes
Technical and specialized services
Time lapse between performance and evaluation
Sold without guarantees and warranties

3. FACTORS CONTRIBUTING TO CONSUMER VULNERABILITY
Performed by boundary-spanning personnel
Accepted variability in performance
Outcome-based reward systems
Consumer participation in production

4. METHODS FOR ETHICAL DECISION MAKING
Teleology
Act is morally acceptable if it produces some desired result.
Form of consequentialism--morality of decisions are based on their consequences.

5. METHODS FOR ETHICAL DECISION MAKING
Types of Teleology
Egoism--acts that benefit the individual’s self-interest.
Utilitarianism--acts that maximize total utility--the greatest good for the greatest number of people.

6. METHODS FOR ETHICAL DECISION MAKGING
Deontology
The inherent rightness or wrongness of an act guides behavior, regardless of the outcome.
Believes that there are some things people should never do.
Relativism
The correctness of decisions is thought to change over time.
Uses others to judge the ethicality of decisions.

7. ISSUES THAT CREATE ETHICAL CONFLICT
Conflict of Interest
Organizational Relationships
Honesty
Fairness
Communication

8. FACTORS THAT INFLUENCE ETHICAL DECISION MAKING
Cognitive Moral Development
Personal Values
Corporate Culture
Cultural Differences
Organizational Structure

9. FACTORS THAT INFLUENCE ETHICAL DECISION MAKING (continued)
Opportunity
Reward Systems
Significant Others
Competitive Environment
Changes in Technology

10. COGNITIVE MORAL DEVELOPMET STAGES
“Right” is based on rules and authority.
Stage 2:
“Right” is based on one’s own needs or another’s in terms of what is fair.
Stage 3:
The individual focuses more on others as opposed to personal gains.

11. COGNITIVE MORAL DEVELOPMENT STAGES
“Right” is based on the individual’s duty to society.
Stage 5:
“Right” is based on basic rights, values, and legal contracts.
Stage 6:
“Right” is a set of universal ethical principles that everyone should adhere to.

12. THE EFFECTS OF ETHICAL MISCONDUCT
Personal Effects
Job-related tension
Frustration
Anxiety
Ineffective performance
Turnover intentions
Lower job satisfaction

13. THE EFFECTS OF ETHICAL MISCONDUCT
Organizational Effects
Customer dissatisfaction
Unfavorable word-of-mouth publicity
Negative image for firm and industry

14. STRATEGIES FOR CONTROLLING ETHICAL DECISION MAKING
Employee socialization
Standards of conduct
Corrective control
Leadership training
Service/product knowledge
Observing employee performance
Stress long-term customer relationships