Ethics is about human flourishing. It is a system of moral principles that govern people’s actions and behaviors. It is concerned with the right exemplary character which is also in line with business success. It is all about courageously giving voice to our unspoken values. Ethics is everything godly, wise, just, and right. These moral principles guide our behaviors and tell us what we ought to be doing.
An example of an ethical person is Cynthia Cooper, who alerted the audit committee of telecom giant WorldCom to one of the largest accounting frauds in history
She was Worldcom’s Vice President of Internal Audit in the summer of 2002 when she discovered accounting entries indicating large transfers of capital from the company’s income statement to its balance sheet. With her team of auditors, she unearthed $3.8 billion of fraudulent entries.
And an example of an ethical organization committed to doing right and ensuring the staff of the organization is flourishing is -eg nestle, southwest airlines.
Integrating ethical principles into business decisions is what business ethics is all about.
This enables the organization’s managers to make decisions that benefit not only the organization but also other stakeholders.
It is important to always remember that our actions can impoverish people if we are not ethical. And of course, we don’t want to be a part of that, instead, our focus should be to lift people out of poverty.
Ethics is not irrationality, selfishness, cutting corners, or using your wealth of knowledge or power to try to outsmart the system.
HUMAN AGENCY CHOICES
Every human being, is confronted with choices, both difficult and simple. Whether we are aware of it or not. And there is always an opportunity cost for every choice we make, and because of this necessity of choice, the human person is a moral agent. The morality of these choices is decided by ethics.
One way firms can deal with ethical dilemmas is to use the four-way test to evaluate decisions. This test involves asking four questions:
- Is my decision a truthful one?
- Is my decision fair to everyone affected?
- Will it build goodwill for the organization?
- Is the decision beneficial to all parties interested in the outcome?
- When these questions can truthfully be answered with a “yes,” it is likely that the decision is ethical.
The firm has 2 customers- Internal and external
Service to customers is all about exceeding and not just meeting customer expectations; it is about meeting all customer needs and providing consistent levels of service.
There are two distinct approaches to customer service:
The Service Approach which emphasizes the creation of value, paying attention to the customer, providing value to the customer and The War approach which is all about profit maximization.
The best of the two approaches is the service approach. The criteria of the service approach are that it should, Create a win-win situation for the customer and firm, Creating value for the customer should be the priority, the firm’s product must be safe to use if the company is into manufacturing goods, then the product contents should be disclosed, Harmful side effects of using the product should be disclosed, The firm should avoid misleading or manipulating customers through their actions or communications.
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