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              Organizational structures  shape company’s value creation

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                      How to battle ethical dilemmas?

                      Dr Vidya Hattangadi by Dr Vidya Hattangadi
                      September 27, 2022
                      in BUSINESS ETHICS
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                      How to battle ethical dilemmas?

                      dilemma1Personal friendship, parental love, career progress, peer pressure often bring us down morally. In a do or die situation we battle ethical dilemmas; the danger may not come from your own ethics but from the ethics of people around you and the situation you are in. At your work place, you may be called upon to do things that turn out to be unethical or even deceitful. What should we do if such situation occurs? According to the old maxim, “the best defense is a good offense.” I think, the best defense would be stop participating in wrongdoing; be prepared to take on challenge go as per your personal values, moral beliefs, and commitment to doing the right thing. It is not at all easy I know.

                      Most people get confused with their faulty thinking of unethical behavior; they think that “bad” people do “bad” things and “good” people are ought to do “good” things. This good-bad tagging of people that we do misleads us in most situations. We see good people or good employees in organizations doing wrong things. So many good employees, good managers, and even good leaders falter. The real challenge therefore is trying to understand why good people do bad things. One reason is that they fail to decide that the problem they are confronting has an ethical component and is not solely a marketing or a finance or an operational problem. As a result, they often lack the ability to analyze the problem from an ethical viewpoint. Organizations therefore need to train their employees to become sensitive to ethics and not to change people’s ethics. The training should concentrate on enhancing people’s sensitivity to ethical issues and provide them with tools for resolving ethical dilemmas effectively.

                      Most organizations and entrepreneurs do not set out to make a defective product or service or they do not like to get involved in a massive fraud. Often, such situations begin in small ways, and with very small actions which seem inconsequential. It is also important for people to understand that most ethics scandals typically involve a number of people who are included in the decision-making process at each stage. As a result, responsibility becomes subtle among these individuals, making it difficult to point out accountability on any particular person. While people may feel uncomfortable in such situations as they start moving down on a slippery slope, they satisfy themselves saying that “as long as it is legitimate, it is ethical” or that they are doing what is expected of them. People rationalize to justify their behavior. And, this is the biggest moral failing.

                      When organizations state in their vision and mission statements that they want to create a culture of integrity and transparency, they require a well-defined, well-articulated code of ethics that clearly tells employees how they are expected to act, the manner in which goals and objectives are to be achieved, and the type of behavior which will not be tolerated. Consecutively, a culture of integrity requires an incentive system that is consistent with and promotes the organization’s values and vision. An incentive system has a tremendous impact on behavior, it must include criteria for promotions, pay raises, and bonuses that encourage and reward behavior that is consonant with the organization’s values.

                      dilemma2Management requires regular monitoring and regulating employee conduct and this can be done by designing and implementing effective internal controls. Incentive systems without attention to ethics often result in unintentionally incentivizing unethical behavior. It is important to remember, however, that organizational cultures are fragile and can easily corrode as companies grow. Therefore, once a culture has been created, it must be constantly strengthened and updated in order to suit its vision. In smaller firms, start-ups, and family-run businesses it is easier to formulate and maintain ethical code of conduct because such organizations typically have founders who set the tone for the organizations and whose behavior serves as a constant reminder of how employees are expected to behave.

                      Leading B Schools in the world have realized that to earn a place at the top table of global business schools alongside Harvard, Stanford or INSEAD, they need to appeal to a global audience and to attract good professors and corporate partners. Business ethics have certainly been in the spotlight in B Schools over the last decade because of rising numbers of scandals involving money laundering, sexual harassment and breaking the rules around defaulted mortgages to name a few. Recently some famous business organizations have been lumped with hefty fines for questionable moral practices.  Should we accept that dubious morals are inevitable for successful business practices? Organizations suffer from ethical drift causing a gradual, unconscious lowering of moral standards. While businesses compete for profit, the boundaries between rights and wrongs become blurred and people’s ethical frame of references shift. Human biases like being unrealistically optimistic about an outcome, believing themselves to be all-powerful, all-knowing and unshakable, and the tendency to justify their own behavior.

                      dilemma3So what can courses in ethics teach in a classroom? Different instructors will have different approaches to teaching ethics. But certain points such as a course in ethics must help students understand the dangers of rationalization. A lot of bad behavior goes on because people tell themselves that such behavior is not at all bad. In the majority of cases, such rationalizations are rooted in very poor reasoning. A course in ethics must give students an opportunity to look at some of the most important rationalizations, in order to examine them under the cold, detached light of logic.

                      A good instructor in ethics can simply give students the opportunity to talk at length, about their ideas on ethics, some of their experiences in life – something they likely wouldn’t otherwise have the opportunity to do. This can have several positive effects. For instance, it can make students more comfortable talking about topics that might otherwise be too awkward to raise. There are some practical insights to be gained by having students read theoretical, scholarly articles on business ethics. Such articles can have benefits; if chosen judiciously they can illustrate for students what first-rate reasoning about ethics actually looks like. Students who study such first-rate reasoning in the classroom stand a better chance of being able to engage in solid ethical reasoning in the workplace. A further benefit of exposure to scholarly articles is that such articles make the readers to think carefully about ethics, and to take the ideas of moral obligation seriously.

                      To sum up this article I would say that, ethics can be precarious to one’s career if he/she is not been trained to identify and analyze ethical problems and to resolve them effectively. Ethics can also be dangerous to a person’s career if the organization he is working in, does not support ethical behavior or, worse, encourages misbehavior. Finally, we should recognize that anyone can get caught up in unethical conduct under the right circumstances. Organizational forces are very strong, and we humans have many psychological weaknesses that make us vulnerable at times and we take unethical decisions. Preventive steps can be taken to improve both organizations and the individuals in them to avoid wrongdoing. But unethical behaviors cannot be eliminated totally.

                      Tags: DilemmasEthicalHow to battle ethical dilemmasPreventive ethical steps.Psychological weaknessesRational judgementUnethical
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                      Dr Vidya Hattangadi

                      Dr Vidya Hattangadi

                      Dr. Vidya Hattangadi is an accomplished academician, researcher, and thought leader with over four decades of combined experience 20 years in managerial roles in industry and 24 years in management education. She holds a PhD in Marketing Management from Savitribai Phule Pune University and a D.Litt. from the University of Mumbai for her post-doctoral published work. She is a prolific writer and blogger, Dr. Hattangadi runs the widely read blog www.drvidyahattangadi.com, which enjoys strong organic traffic and engages readers across a broad spectrum of subjects, including management, leadership, psychology, social trends, music, current affairs, and politics and psychology. Her blog is 12 years old. Her experience of combining knowledge of industry work with an academic background creates a powerful, "pracademic" profile that bridges the gap between theoretical knowledge and practical application. This hybrid approach has made her a powerful Professor in the classrooms and she has produced graduates who are not just knowledgeable, but industry-ready. She worked for Maratha Mandir’s Babasaheb Gawde Institute of Management Studies as Director, Research Head and Professor. She has written a fortnightly column for The Financial Express from 2017 to 2021 and has contributed extensively to leading publications such as The Hindu, Free Press Journal, and The Economic Times. Her articles are known for their analytical depth, clarity, and relevance to contemporary issues. Dr. Hattangadi has successfully guided 35 PhD scholars in Management Studies across institutions such as the University of Mumbai, SNDT Women’s University, and Yashwantrao Chavan Maharashtra Open University (YCMOU) and Guglielmo Unimarconi Italian University. Currently, she is working on her YouTube channel "Vidya's Vidya" mentoring doctoral researchers in the areas of Finance, Strategic Management, Organizational Behaviour, Human Resource Management, and Marketing Management. She is an accomplished author, she has written books on Strategic Management, Buyer Behaviour, International Business and Entrepreneurship Management, Faith Economy, contributed chapters to four edited volumes of books, and published over 350 research papers in national and international journals. Her scholarly work has strong visibility and impact, reflected in her robust presence on Google Scholar, Research Gate, Vidwan etc. Her research in all fields of management studies is truly ground-breaking. The rigor and depth of her knowledge have set a new standard in our field of management studies.

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