Ethical Challenges Managers Face During Their Decision-Making Commitments
Friedrich Nietzsche once said, “A moral system valid for all is basically immoral.” There are a lot of challenges managers face daily. These challenges are linked to the business. Although people are trying to say “business is business,” they face dilemmas regarding their moral and ethical decision-making. One can argue that many principles explain the “know-how” when it comes to decision-making. The others, like Argandoña (2015), seem to think differently as he argued, “Being ethical in business is difficult, given the nature of the tasks involved with leading an organization” (pp. 2). The author ended his argument with, “Yes, it is hard to be ethical in business. But it is necessary”. Going through the challenges that managers face and the ethical theories and standards meant to create a solid framework to guide managers during the establishment, promotion, and maintenance of the business.
Decision-making comes with various stages: recognizing the moral issue, making a moral judgment, and taking moral actions. (Scarborough & Cornwall, 2016). Ethical decisions can be influenced for many reasons; one is individual, the other is situational. These influences, along with other factors like religions and personal beliefs, will have a huge impact on decision-making, especially if the decision-maker is a regular stakeholder or employee with very extreme beliefs or principles.
During the business establishment phases, managers face some challenges. According to Scarborough and Cornwall (2016), some key ethical tests can be applied at the establishment phase. One is the utilitarian principle that offers the greatest good for the greatest number of people. Another is Kant’s categorical imperative that “act in such a way that the action taken under the circumstances could be a universal law or rule of behavior” (Scarborough & Cornwall, 2016, p. 71). There is the Golden Rule, which encourages you to “treat other people the way you would like them to treat you. And few others”. (Scarborough & Cornwall, 2016, p. 71).
During the business-promoting phase, ethical challenges can arise. According to Scarborough and Norman (2016), There are ten ethical principles to guide managers and set a roadmap that they can follow, including Honesty, Integrity, Promise-keeping, Fidelity, Fairness, Caring for Others, Respect for others, Responsible citizenship, Pursuit of excellence, Accountability.
During the business maintenance phases, managers have many standards that they can follow, including establishing high standards at the workplace among employees, develop and maintain a code of ethics, enforce the code of ethics by setting policies, recruit and promote ethical employees, conduct ethical training, perform periodic ethical audits. And a few more that managers can start with and develop what works for the company and business. (Scarborough & Cornwall, 2016)
Scarborough and Cornwall (2016) demonstrated the story of General Motors (GM) when they were facing a design issue that was considered fatal to customers. The issue was with one of their cars, specifically with its Chevrolet Malibu model. The Authors show that “The company decided to reposition the fuel tank on the car, despite knowing that this would increase the possibility of passengers being harmed in fuel-fed fires if the car was involved in a rear collision” (Scarborough & Cornwall, 2016). After doing the math, the company concluded that each fatality cost GM $2.40 per car. Given that the correct design measures that GM went ahead and implemented instead would cost $8.59 per car. The authors state that the company “could save $6.19 ($8.59 — $2.40) per car if it allowed people to die rather than changing the design”.
Given the situation of GM and the decision they made and the ethical standards that clearly the ethical standards were obvious and to some extent can mitigate the consequences if taken seriously into the benefit and safety of customers. Instead, GM decided to take the risk given the price, neglecting the social responsibility towards people and human rights. Showing that the ethical standards didn’t help the decision-makers at GM in this situation (Scarborough & Cornwall, 2016).
It is valid to conclude that ethical theories and standards are of great value and lead to better decision-making. On the other hand, these standards are subjected to a general aspect and might be confusing to adopt or follow.
References:Argandoña, A. (2015). Why is it hard to be ethical in business? Retrieved from iese: https://blog.iese.edu/ethics/2015/07/09/why-is-it-hard-to-be-ethical-in-business/Scarborough, N. M., & Cornwall, J. R. (2016). Essentials of Entrepreneurship and Small Business Management.