1. 3Chapter PowerPoint Presentation by Charlie Cook © Copyright The McGraw-Hill Companies, Inc., 2003. All rights reserved. Attitudes, Values, Ethics, and Culture: The Manager as a Person

2. © Copyright McGraw-Hill. All rights reserved.3–23–2 Learning Objectives After studying the chapter, you should be able to:After studying the chapter, you should be able to:  Describe the various personality traits that affect how managers think, feel, and behave.  Explain what values, attitudes, and moods and emotions are and describe their impact on managerial action.  Illustrate how ethics hilp managers determine the right or proper way to behave when dealing with different stakeholder groups.  Define organizational culture and explain the role managers play in creating it.  Explain why managers should strive to create ethical organizational cultures.

3. © Copyright McGraw-Hill. All rights reserved.3–33–3 Chapter Outline Enduring Characteristics: Personality TraitsEnduring Characteristics: Personality Traits  The Big Five Personality Traits  Other Personality Traits that Affect Managerial Behavior Values, Attitudes, and Moods and EmotionsValues, Attitudes, and Moods and Emotions  Values: Terminal and Instrumental  Attitudes  Moods and Emotions  Emotional Intelligence

4. © Copyright McGraw-Hill. All rights reserved.3–43–4 Chapter Outline (cont’d) Ethics and StakeholdersEthics and Stakeholders  Which Behaviors Are Ethical  Why Would Managers Behave Unethically Toward Other Stakeholders?  Sources of an Organization’s Code of Ethics Organizational CultureOrganizational Culture  How Managers Influence Organization Culture  Ethical Organizational Cultures  Social Responsibility Summary and ReviewSummary and Review

5. © Copyright McGraw-Hill. All rights reserved.3–53–5 Personality Traits Personality TraitsPersonality Traits  Enduring tendencies to feel, think, and act in certain ways  Characteristics that influence how people think, feel and behave on and off the job  The personalities of managers account for the different approaches that managers adopt to management.  Traits are viewed as a continuum (from high to low) along which individuals fall.

6. © Copyright McGraw-Hill. All rights reserved.3–63–6 The Big Five Personality Traits Figure 3.1 Source:

7. © Copyright McGraw-Hill. All rights reserved.3–73–7 The Big Five Personality Traits (cont’d) ExtroversionExtroversion  The tendency to experience positive emotions and moods and to feel good about oneself and the rest of the world Managers high on this trait are sociable and friendly.Managers high on this trait are sociable and friendly. Negative AffectivityNegative Affectivity  The tendency to experience negative emotions and moods, to feel distressed, and to be critical of oneself and others Managers high on this trait are often critical and feel angry with others and themselves.Managers high on this trait are often critical and feel angry with others and themselves.

8. © Copyright McGraw-Hill. All rights reserved.3–83–8 A Measure of Negative Affectivity Figure 3.2 Source: Tellegen, Brief Manual for the Differential Personality Questionnaire (unpublished manuscript, University of Minnesota, 1982).

9. © Copyright McGraw-Hill. All rights reserved.3–93–9 The Big Five Personality Traits (cont’d) AgreeablenessAgreeableness  The tendency to get along well with other people Managers high on this trait are likable, and care about others.Managers high on this trait are likable, and care about others. ConscientiousnessConscientiousness  The tendency to be careful, scrupulous, and persevering Openness to ExperienceOpenness to Experience  The tendency to be original, have broad interests, to be open to a wide range of stimuli, be daring, and take risks

10. © Copyright McGraw-Hill. All rights reserved.3–10 Traits and Managers Successful managers vary widely on the “Big Five”.Successful managers vary widely on the “Big Five”.  It is important to understand these traits since it helps explain a manager’s approach to planning, leading, organizing, etc.  Managers should also be aware of their own style and try to tone down problem areas.

11. © Copyright McGraw-Hill. All rights reserved.3–11 Other Personality Traits… Internal Locus of ControlInternal Locus of Control  The tendency to locate responsibility for one’s own fate within oneself People believe they are responsible for their fate and see their actions as important to achieving goals.People believe they are responsible for their fate and see their actions as important to achieving goals. External Locus of ControlExternal Locus of Control  The tendency to locate responsibility for one’s fate within outside forces and to believe that one’s own behavior has little impact on outcomes People believe external forces decide their fate and their actions make little difference.People believe external forces decide their fate and their actions make little difference.

12. © Copyright McGraw-Hill. All rights reserved.3–12 Other Personality Traits… (cont’d) Self-EsteemSelf-Esteem  The degree to which people feel good about themselves and their abilities High self-esteem causes a person to feel competent, and capable.High self-esteem causes a person to feel competent, and capable. Persons with low self-esteem have poor opinions of themselves and their abilities.Persons with low self-esteem have poor opinions of themselves and their abilities. Need for AchievementNeed for Achievement  The extent to which an individual has a strong desire to perform challenging tasks well and meet personal standards for excellence

13. © Copyright McGraw-Hill. All rights reserved.3–13 Other Personality Traits… (cont’d) Need for AffiliationNeed for Affiliation  The extent to which an individual is concerned about establishing and maintaining good interpersonal relations, being liked, and having other people get along Need for PowerNeed for Power  The extent to which an individual desires to control or influence others

14. © Copyright McGraw-Hill. All rights reserved.3–14 Values, Attitudes, and Moods and Emotions ValuesValues  Describe what managers try to achieve through work and how they think they should behave AttitudesAttitudes  Capture managers’ thoughts and feelings about their specific jobs and organizations. Moods and EmotionsMoods and Emotions  Encompass how managers actually feel when they are managing

15. © Copyright McGraw-Hill. All rights reserved.3–15 ValuesValues Terminal ValuesTerminal Values  A personal conviction about life-long goals A sense of accomplishment, equality, and self- respect.A sense of accomplishment, equality, and self- respect. Instrumental ValuesInstrumental Values  A personal conviction about desired modes of conduct or ways of behaving Being hard-working, broadminded, capable.Being hard-working, broadminded, capable. Value SystemValue System  The terminal and instrumental values that are the guiding principles in an individual’s life.

16. © Copyright McGraw-Hill. All rights reserved.3–16 Terminal and Instrumental Values Figure 3.3 Source: Rokeach, The Nature of Human Values (New York: Free Press, 1973).

17. © Copyright McGraw-Hill. All rights reserved.3–17 AttitudesAttitudes AttitudesAttitudes  A collection of feelings and beliefs. Job SatisfactionJob Satisfaction  A collection of feelings and beliefs that managers have about their current jobs. Managers high on job satisfaction have a positive view of their jobs.Managers high on job satisfaction have a positive view of their jobs. Levels of job satisfaction tend increase as managers move up in the hierarchy in an organization.Levels of job satisfaction tend increase as managers move up in the hierarchy in an organization.

18. © Copyright McGraw-Hill. All rights reserved.3–18 Sample Items from Two Measures of Satisfaction Figure 3.4 Source: R.B. Dunham and J. B. Herman, “ Development of a Female Face Scale for Measuring Job Satisfaction.” Journal of Applied Psychology 60 (1975): 629–31.

19. © Copyright McGraw-Hill. All rights reserved.3–19 Attitudes (cont’d) Organizational Citizenship BehaviorsOrganizational Citizenship Behaviors  Behaviors that are not required of organizational members but that help the firm in gaining a competitive advantage. Managers with high satisfaction are more likely perform these “above and beyond the call of duty” behaviors.Managers with high satisfaction are more likely perform these “above and beyond the call of duty” behaviors. Managers who are satisfied with their jobs are less likely to quit.Managers who are satisfied with their jobs are less likely to quit.

20. © Copyright McGraw-Hill. All rights reserved.3–20 Attitudes (cont’d) Organizational CommitmentOrganizational Commitment  The collection of feelings and beliefs that managers have about their organization as a whole Committed managers are loyal to and are proud of their firms.Committed managers are loyal to and are proud of their firms. Commitment can lead to a strong organizational culture.Commitment can lead to a strong organizational culture. Commitment helps managers perform their figurehead and spokesperson roles.Commitment helps managers perform their figurehead and spokesperson roles. The commitment of international managers is affected by job security and personal mobility.The commitment of international managers is affected by job security and personal mobility.

21. © Copyright McGraw-Hill. All rights reserved.3–21 A Measure of Organizational Commitment Figure 3.5 Source: L. W. Porter and F. J. Smith, “Organizational Commitment Questionnaire,” in J. D. Cook, S. J. Hepworth, T. D. Wall, and P. B. Warr, eds., The Experience of Work: A Compendium and Review of 249 Measures and Their Use (New York: Academic Press, 1981), 84–86.

22. © Copyright McGraw-Hill. All rights reserved.3–22 Moods and Emotions MoodMood  A feeling or state of mind Positive moods provide excitement, elation, and enthusiasm.Positive moods provide excitement, elation, and enthusiasm. Negative moods lead to fear, distress, and nervousness.Negative moods lead to fear, distress, and nervousness. Current situations and a person's basic outlook affect a person’s current mood.Current situations and a person's basic outlook affect a person’s current mood.  A manager’s mood affects their treatment of others and how others respond to them. Subordinates perform better and relate better to managers who are in a positive mood.Subordinates perform better and relate better to managers who are in a positive mood.

23. © Copyright McGraw-Hill. All rights reserved.3–23 A Measure of Positive and Negative Mood at Work Figure 3.6 Source: A. P. Brief, M. J. Burke, J. M. George, B. Robinson, and J. Webster, “ Should Negative Affectivity Remain an Unmeasured Variable in the Study of Job Stress?” Journal of Applied Psychology 73 (1988): 193–98.

24. © Copyright McGraw-Hill. All rights reserved.3–24 Emotional Intelligence Emotional IntelligenceEmotional Intelligence  The ability to understand and manage one’s own moods and emotions and the moods and emotions of other people. Assists managers in coping with their own emotions.Assists managers in coping with their own emotions. Helps managers carry out their interpersonal roles of figurehead, leader, and liaison.Helps managers carry out their interpersonal roles of figurehead, leader, and liaison.

25. © Copyright McGraw-Hill. All rights reserved.3–25 Ethics and Stakeholders Organizational StakeholdersOrganizational Stakeholders  Shareholders, employees, customers, suppliers, and others who have an interest, claim, or stake in an organization and in what it does Each group of stakeholders wants a different outcome and managers must work to satisfy as many as possible.Each group of stakeholders wants a different outcome and managers must work to satisfy as many as possible. Managers have the responsibility to decide which goals an organization should pursue to most benefit stakeholders—decisions that benefit some stakeholder groups at the expense of others.Managers have the responsibility to decide which goals an organization should pursue to most benefit stakeholders—decisions that benefit some stakeholder groups at the expense of others.

26. © Copyright McGraw-Hill. All rights reserved.3–26 Ethics and Stakeholders (cont’d) EthicsEthics  Moral principles or beliefs about what is right or wrong  Ethics guide managers in their dealings with stakeholders and others when the best course of action is unclear.  Managers often experience an ethical dilemma in choosing between the conflicting interests of stakeholders.

27. © Copyright McGraw-Hill. All rights reserved.3–27 Ethical Decision Models Utilitarian ModelUtilitarian Model  An ethical decision is one that produces the greatest good for the greatest number of people. Moral Rights ModelMoral Rights Model  An ethical decision is one that best maintains and protects the fundamental rights and privileges of the people affected by it. Justice ModelJustice Model  An ethical decision is one that distributes benefits and harms among stakeholders in a fair, equitable, or impartial way.

28. © Copyright McGraw-Hill. All rights reserved.3–28 Practical Guide to Ethical Decisions Does the manager’s decision fall within usual and accepted standards?Does the manager’s decision fall within usual and accepted standards? Is the manager willing to personally and openly communicate the decision to all affected stakeholders?Is the manager willing to personally and openly communicate the decision to all affected stakeholders? Does the manager believe that his friends would approve?Does the manager believe that his friends would approve? If the answer is “Yes” to all of the above, the decision is probably an ethical decision.If the answer is “Yes” to all of the above, the decision is probably an ethical decision.

29. © Copyright McGraw-Hill. All rights reserved.3–29 Ethical versus Unethical Decisions Ethical DecisionEthical Decision  A decision that is reasonable or typical stakeholders would find acceptable because it aids stakeholders, the organization, or society. Unethical DecisionUnethical Decision  A decision that a manager would prefer to disguise or hide from other people because it enables the company or a particular individual to gain at the expense of society or other stakeholders.

30. © Copyright McGraw-Hill. All rights reserved.3–30 Sources of An Organization’s Code of Ethics Figure 3.7

31. © Copyright McGraw-Hill. All rights reserved.3–31 Sources of Ethics Societal EthicsSocietal Ethics  Standards that govern how members of a society are to deal with each other on ethical issues Based on values and standards found in society’s legal rules, norm, and moresBased on values and standards found in society’s legal rules, norm, and mores Codified in the form of laws and societal customsCodified in the form of laws and societal customs Ethical norms dictate how people should behave.Ethical norms dictate how people should behave. Societal ethics vary among societies.Societal ethics vary among societies.  Strong beliefs in one country may differ elsewhere. Payment of bribes, an illegal act in the U. S., is an accepted business practice in many countries.Payment of bribes, an illegal act in the U. S., is an accepted business practice in many countries.

32. © Copyright McGraw-Hill. All rights reserved.3–32 Sources of Ethics Professional ethicsProfessional ethics  Standards that govern how members of a profession are to make decision when the way they should behave is not clear-cut Physicians and lawyers have professional associations that enforce these.Physicians and lawyers have professional associations that enforce these. Individual ethicsIndividual ethics  Personal standards that govern how individuals are to interact with other people Influenced by family, upbringing in general, and life experiencesInfluenced by family, upbringing in general, and life experiences

33. © Copyright McGraw-Hill. All rights reserved.3–33 Ethical Decisions and Dilemmas A key ethical issue is how to disperse harm and benefits among stakeholders.A key ethical issue is how to disperse harm and benefits among stakeholders.  If a firm has been very profitable for two years, who should receive the profits? Employees, managers and stockholders all will want a share.  Should the firm keep the cash for future slowdowns? What is the ethical decision?  What about the reverse, when firms must layoff workers?  If stockholders are the legal owners of the firm, shouldn’t they alone decide these questions?

34. © Copyright McGraw-Hill. All rights reserved.3–34 Ethical Decisions and Dilemmas (cont’d) Some other issues managers must consider.Some other issues managers must consider.  Should a firm withhold payment to suppliers as long as possible to benefit the firm? This will harm its supplier who is a stakeholder.This will harm its supplier who is a stakeholder.  Should a firm provide severance pay to its laid off workers? This will decrease the owners’ (the stockholders return.This will decrease the owners’ (the stockholders return.  Should goods be bought from overseas firms that employ children? If they aren’t bought, the children might not earn enough money to eat.If they aren’t bought, the children might not earn enough money to eat.

35. © Copyright McGraw-Hill. All rights reserved.3–35 Why Behave Ethically? Managers should behave ethically to avoid harming others.Managers should behave ethically to avoid harming others.  Managers are responsible for protecting and nurturing resources of the firm Unethical managers run the risk for loss of reputation.Unethical managers run the risk for loss of reputation.  This is a valuable asset to any manager; reputation is critical to long term management success.

36. © Copyright McGraw-Hill. All rights reserved.3–36 Organizational Culture Organizational CultureOrganizational Culture  The set of shared values, norms, standards for behavior, and shared expectations that influence the way in which individuals, groups, and teams interact with each other and cooperate to achieve organizational goals. Attraction-Selection-Attrition FrameworkAttraction-Selection-Attrition Framework  A model that explains how personality may influence organizational culture. Founders of firms tend to hire employees whose personalities that are to their own, which may or may not benefit the organization over the long-term.Founders of firms tend to hire employees whose personalities that are to their own, which may or may not benefit the organization over the long-term.

37. © Copyright McGraw-Hill. All rights reserved.3–37 Ethical Organizational Cultures Components of an Ethical CultureComponents of an Ethical Culture  Ethical values and norms are a central component of the organizational culture  A code of ethics guides decisions when ethical decisions arise.  Managers serve as ethical role models Ethics OmbudsmanEthics Ombudsman  An ethics officer who monitors an organization’s practices and procedures to ensure they are ethical.

38. © Copyright McGraw-Hill. All rights reserved.3–38 Social Responsibility Social ResponsibilitySocial Responsibility  A manager’s duty or obligation make decisions that promote the welfare and well-being of stakeholders and society as a whole.

39. © Copyright McGraw-Hill. All rights reserved.3–39 Approaches to Social Responsibility Figure 3.8 Source:

40. © Copyright McGraw-Hill. All rights reserved.3–40 Approaches to Social Responsibility (cont’d) Obstructionist responseObstructionist response  Managers choose not to be socially responsible.  They behave illegally and unethically; hiding and covering up problems.

41. © Copyright McGraw-Hill. All rights reserved.3–41 Approaches to Social Responsibility (cont’d) Defensive responseDefensive response  Managers stay within the law but make no attempt to exercise additional social responsibility.  Managers place shareholder interests above those of all other stakeholders.  Managers argue that society should pass laws and create rules if change is needed.

42. © Copyright McGraw-Hill. All rights reserved.3–42 Approaches to Social Responsibility (cont’d) Accommodative responseAccommodative response  Managers acknowledge the need to support social responsibility and try to balance the interests of different stakeholders against one another. Proactive responseProactive response  Managers actively embrace the need to behave in socially responsible ways and go out of their way to learn about needs of different stakeholders.  They are willing to utilize organizational resources for both stockholders and stakeholders.

43. © Copyright McGraw-Hill. All rights reserved.3–43 Johnson & Johnson Credo Figure 3.9 Source: Johnson & Johnson Annual Report.