Chapter 7

Organizational Factors:
Structure, Relationships,
and Conflicts
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7-1

Key Influences on Ethical Behavior

society
corporate culture
significant others
strength of the individuals personal values
opportunity
exposure to others that behave (un)ethically
informal relationships
formal relationships
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7-2

Responsibility of the
Corporation as a Moral Agent
chartered as citizens of a state and nation,
therefore have all the rights and
responsibilities of individuals
responsible to society for its decisions
assigned to promote business ethics and
social responsibility
must require compliance with ethical policies
representing the interests of all stakeholders
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7-3

Variation in Employee Conduct

10%will take advantage of situations to
further their own personal interests
40%will go along with the work group on
most matters
40%will try to follow company policies
and rules and have a strong grasp of
the corporate culture
10%maintain formal standards that focus
on rights, duties and rules
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7-4

Socialization...
the process through which a person learns the
values and behavior patterns considered
appropriate by an organization or group
has a significant influence on ethical
behavior
ethical conflict arises when the values
and norms of the individual conflict with
those taught through socialization
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7-5

Role-Sets...
the total of all role relationships in which an
individual is involved because of his or her
position in an organization
Role-sets may help predict ethical behavior.
Persons in the same department are
socialized similarly and share the
same specialization and knowledge base.
Members of an organization have more
in common with one another than with
members of other organizations.
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7-6

Role Stress...
strain, conflict, or disruption that results from
a lack of agreement on certain job-related
activities
The role that an individual plays in the business,
and the tasks associated with that role, can
potentially create conflict that has a direct
bearing on ethical decision-making
behavior.
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7-7

Differential Association...
refers to the idea that people learn ethical or
unethical behavior while interacting with others
who are part of their role-sets or other intimate
personal groups
If interaction is with those who behave unethically,
parallel behavior may be expected.
Superiors have strong influence on the ethics of their
subordinates.
Differential association with peers and opportunity are
better predictors of unethical behavior than is the
persons own ethical belief system.
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7-8

Whistle-Blowing...
when unethical or illegal behavior occurs in
the organization and individual interpersonal
conflict occurs
exposing an employers wrongdoing to
outsiders such as the media or government
regulatory agencies
provides an in-house mechanism for
employees to voice concerns
usually anonymous
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7-9

Questions to Ask Before

Blowing the Whistle...
Is this the only method to resolve my
concern?
Do I have the appropriate documentation or
evidence to prove my case?
What is my motivation?
Am I prepared to deal with the personal and
professional repercussions?
Adapted from: Paula Dwyer and Dan Carney (2002) Year of the
Whistleblower, Business Week, Dec. 16, p. 108.
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7-10

Organizational Pressures...
Success in organizations is determined through
the achievement of organizational goals.
Internal organizational pressure stemming from
role-set relationships and differential association
is a major predictor of unethical behavior.
Top management and superiors play
crucial roles in developing the
environment that influences
ethical behavior.
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7-11

Opportunity Creates Ethical

Dilemmas...
Opportunity is a set of conditions that limits
unfavorable behavior or rewards favorable
behavior.
Rewards may be internal (self-worth, enjoyment).
Rewards may be external (raises, promotion).

A person who behaves unethically

and is rewarded is likely to continue
the behavior; punishment is a more
suitable deterrent.
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7-12

Opportunity Also Comes

from Knowledge...
A person with information, expertise or
competitive knowledge has the opportunity to
exploit this knowledge.
Long-term employment with one company
leads to gatekeepingsocializing newer
employees regarding culture, tradition, rules,
unwritten traditions, etc.
Trainers and mentors influence
new employees behavior.
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7-13

Conflict Resolution...
occurs when it is not clear which goals or
values take precedencethose of the
organization or a group within the organization
personal-organizational conflict
personal-societal conflict
organizational-societal
conflict

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7-14

Types of Conflict...
person-organizational
occurs when a persons individual values and
methods for reaching desired goals are different
from the organization or work group

person-societal
when an individuals values deviate from those of
society (societys values--laws and regulations)

organizational-societal
norms and values of business conflict with society
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7-15

Improving Ethical Decision

Making in Business...
ethical behavior depends on:
the embedded organizational value system
(corporate culture)
significant others
personal value preferences of
the organizations groups
and individual members

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7-16