Management Strategy and Practice - Research Proposal Example

Management Strategy and Practice Table of Contents Introduction 3 Aim 4 Research Questions 4 Discussion 4 Features of Business Ethics 4 Business Ethics Theories 5 Importance of Business Ethics 6 Corporate Social Responsibility 8 Arguments in Favour and Against the Business Ethics 9 Conclusion 10 References 12 Introduction Ethics may be defined as the moral principle by which the right and wrong can be easily distinguished. It is a Greek word, which means character or manner. Thus, we can define business ethics as the code of values and principles that governs the decision and actions of any business. The business philosophy of any company or organization is reflected through business ethics and its practices. It acts as a code of conduct for the organization that helps to judge what is right and what is wrong for the welfare of the society as well as the business. Thus, it is required for every business enterprises to follow this code of conduct. Ethics are based on the moral and social values that every business should follow. For the proper functioning of any business organization, it is required to follow the best practices of business ethics. Ethically conducting business will help the same to attract more customers and thereby increase the volume of sales and as a result the profit margin will also increase considerably. Maintaining ethics in the business also motivates the employees in increasing job satisfaction and reduces the turnover of labour, which ultimately leads to more productivity. The investors are also attracted towards the company, which will result in high share price of the company in the market. Moreover, every business organization should involve themselves in Corporate Social Responsibility programs. Apart from focusing only on the profit of the business, it is also required by the company to focus on the welfare of the community or the society. Thus, following business ethics and practices not only benefits the organization, but also benefits the society at large (Businesscasestudies, 2014; Scribd Inc, 2014; Applied-Corporate-Governance.com, 2014). Aim The aim of the paper is to identify the importance of business ethics for any organization as well as society. Research Questions The research questions for the paper are – 1) What are the key features of business Ethics? 2) What is the importance of Business ethics in an organization? 3) What are the roles of Business ethics for the welfare of the society? Discussion Features of Business Ethics Business ethics deals with the morality and values that are adopted by an entity for the wellbeing of the society as well as the business. The society is being affected by the products that are being supplied by the organization at large. Hence, it is necessary for every business enterprise to perform the activities with self-control, self-sacrifice and self-check. Apart from having concern for the organization, the business community should also focus on the welfare of the society, which signifies an ethical value. Honesty and trustworthiness is also considered as an important element of business ethics. The customers always depends on the organization and trust on the products and services that it provides. Thus, it is the responsibility of the organization to be truthful and honest to the customers and conduct fair business practices. Moreover, the business should not make fake promises or commitments to its clients as it is unethical from the end of the customer. It should be honest towards the customers and shareholders and always be truthful to its promises, whatever may be the situation. Maintaining ethics and proper code of conduct is important for the welfare of the business. Every department of an organization needs to maintain its ethics and values for long term sustainability. Confidentiality is considered as one of the basic features of business ethics. Every business enterprise has some confidential matters and policies that are restricted and cannot be disclosed outside the organization. Thus, it is required for every employee of the organization to adhere to the confidentiality of the organization and maintain ethical practices. As a result of the improved technology, it has become easy to carry out different business activities. Internet serves as the ultimate source of any information and thus it has become important to have technical integrity as a part of the business ethics. It is required by every organization not to violate the copyright laws that are unique for every organization. Creating an open environment in the organization is also considered as a key feature of business ethics. There should be an open communication inside the organization that will help the employees to come forward and report if anything wrong is happening in the organization or the organization policy are being violated. This will create a sense of integrity and value among the employees. They should not fear to come forward and the employees should also be encouraged to report any wrong doing in the organization (Scribd Inc, 2014). This aspect reflects the ethical practices of a business in an integrated manner. Business Ethics Theories The theories related to business ethics consists of the codes or moral principles that is implemented by a business community in order to ensure that the employees are carrying out their business activities with acceptable behaviour. There are various types of business ethics theory like utilitarian approach, rights ethical approach, justice approach, virtue approach and common good approach. The owners of the business as well managers can make use of the business ethics theory, which they feel most suitable for their operations. All these theories can be used separately or can be applied by combining two theories. Each theory comprises of specific characteristics, which are focused on some particular ethical principles that a business enterprise can adopt in order to solve their business problem. The utilitarian approach focuses on promoting value to the society by making use of ethical actions and considering that the harm to the society is minimized. The right ethical approach states that every individual have rights in life and they should be treated with respect and dignity. According to the Justice Approach, every individual should be treated equally, irrespective of their class, creed, religion, rank and position. This approach is also known as fairness approach in the theory of business ethics. The common goal approach focuses on promoting the ethical principles morals and values that are found in the society. However the values of the approach differ according to the culture and society of every country. Thus, a business owner can apply the most suitable theory among these four theories in their business in order to conduct their business in an ethical manner (Applied-Corporate-Governance.com, 2014). Every theory reflects the fact that for the success of an organization it is important to follow ethics and values. Importance of Business Ethics Business ethics play a significant role for the benefit of the organization as well as society. Business ethics helps to mitigate the malpractices of the businesses to enhance the profitability as well as sustainability. Many business owners adopt unfair practices in their businesses like black marketing, selling duplicate products and high pricing of products, which are harmful for the consumers. Business ethics also play an important role in improving the confidence of the customers regarding quality, price and quantity. It is evident that businesses with ethics and proper code of conducts are able to satisfy the stakeholders to a certain extent. Customers have more trust on those business owners who adopt ethical policies while conducting their business activities. Moreover, business ethics are also important for the proper functioning of the business organization and its survival. The business owners, who do not follow business ethics, will have success in short run but they will ultimately fail in long run. This is because the business owner cannot succeed by using unfair means. Ethics of the company is important in maintaining the finances of an organization. Failure to follow ethical practices in the business affects the long term sustainability of the organization. Thus, it is necessary for every business owner to follow proper code of conduct and ethical rules in the business activities in order to survive in the market. Moreover, business ethics is also important in safeguarding the consumer rights. The consumer possesses various rights like, right to choose, right to be informed and right to health and safety. There are many business owners who do not respect these rights of the consumers. The business ethics helps to protect these rights. Business ethics also protects the dealers, suppliers, shareholders and the employees from exploitation through business malpractices. The business ethics plays an important role in establishing favourable relationship between the business and the society, which will result in the supply of goods and services of good quality. Ethics assists in maintaining the employee from being exploited by following proper organizational norms and policies. This will help the business enterprise to earn more profit and thus, the economy of the country will also prosper. The businessman who conduct their business activities according to the ethical rules, are always accepted by the society and help to flourish more. Moreover, it is also believed that, following the business ethics keeps the employees, shareholders, employers, dealers and suppliers satisfied and thus helps in the smooth functioning of the business activities. This will help in the growth of the business enterprise and earn more profit (Applied-Corporate-Governance.com, 2014; Hearst Newspapers, LLC, 2014). Corporate Social Responsibility Corporate Social Responsibility (CSR) is considered as an important component of business ethics. It is a management concept through which, the organizations adopt various social and environmental concerns in their day to day business activities. With the help of CSR activities, the organizations are able to maintain a balance between social, economic and environmental issues and simultaneously considering the interest of the stakeholders. By adopting the CSR activities, not only the concern for the society and the environment is increased but also the reputation of the company and brand position is enhanced. The key points that are focused in the CSR activities are concern for the society, concern for the environment, measures for anti-corruption, human rights, gender equality, labour standards, employee relations, and concern for the shareholders. If the concept of CSR is implemented properly, the organization can avail certain competitive advantages like increased access to capital markets, increase in sales resulting in more profits, reduction in the operations cost, improvement in the quality of the products, better productivity, increased customer loyalty and efficiency in the human resource. Thus, it can be seen that the CSR activities not only has a positive impact on the organization but also concerns for the society and the environment. Companies as a part of the business ethics need to follow CSR activities for better results. However it has been argued by some critics that the objective of the business organization is to maximize the shareholders’ value and have responsibility towards the society. According to them, the organizations are helping the society by distributing profits to the shareholders, who can further make charitable donations for the welfare of the society by following ethical practices and code of ethics (Social Media Today LLC, 2012; Crown, 2011). Arguments in Favour and Against the Business Ethics There are various arguments in favour and against the adoption of business ethics in the day to day activities of the business organization. Arguments are made on the fact that a business enterprise cannot survive in the market if it does not follow the business ethics. Until and unless the business pursues moral standards and values that will be beneficial for the business as well as the society, it will be impossible for any business organization to sustain in the market. Arguments are also made against the adoption of business ethics in the organization. It is believed that earning the profit in a perfectly competitive market by a business organization, will assure that the society is being benefited by the organization. A business enterprise can adopt business ethics by following the CSR activities. However it is argued that, it is not necessary for the business establishment to adopt CSR activities in order to benefit the society and the economy, rather the profit that is being distributed to the shareholders may serve to the benefit of the society. The shareholders may make charitable donations to the society from the profit earned by the business as a result, directly or indirectly the business organization is providing benefit to the society. Some economists believe that, maximizing the amount of profit should be the main ethical objective of any business owner. They should be concerned in studying marketing, operations and finance rather than studying the ethics of the organization. Apart from profit maximization, the organization should focus on the legal incentive structure for the employees. Similarly, it is also arguable that, it is sufficient for any business enterprise to conduct their business activities according to the established business law or industrial law, as business ethics and business law are considered similar. However, it is not necessarily important that the business law includes the values and morals that are involved with business ethics. There are some business laws that may violate the morals and values. An argument in favour of the adoption of business ethics in the organization states that, as the ethics are inherently related with the human activities, thus it is necessarily important for every business organizations to adopt the business policy. The adoption of the business ethics will lead to the maximization of profits of the company, which will result in its growth and development (Flat World Education, Inc, 2014; Hooker, J., 2004). Conclusion Thus, it can be concluded that it is very essential for every organization to carry out their business activities by following the business ethics. Apart from having concern regarding the profit of the company, business also has some responsibility towards the society, as it is the society upon whom the business is dependent on. If the business is carried out ethically, more customers will be attracted towards it, which will result in the increase of the volume of sales and thus the profit earned by the company will also maximize. Moreover, the market share of the company will also increase as more investors will be attracted, which is beneficial for the company. A company may follow business ethics by providing quality services and charge true price from the customers and be truthful to them regarding the services that they deserve from the business. Thus, business ethics should be focused on various morals and values that should be possessed by the company for the welfare of the employees as well as the society. References Applied-Corporate-Governance.com, 2014. Factors Highlighting the Importance of Business Ethics. Rule 1: The Importance of Business Ethics. [Online] Available at: http://www.applied-corporate-governance.com/importance-of-business-ethics.html [Accessed December 1, 2014]. Businesscasestudies, 2014. The Importance of Ethics in Business. Ethical Business Practices. [Online] Available at: http://businesscasestudies.co.uk/cadbury-schweppes/ethical-business-practices/the-importance-of-ethics-in-business.html#axzz3KdOUACC [Accessed December 1, 2014]. Crown, 2011. The Business Benefits of Corporate Social Responsibility. Corporate Social Responsibility. [Online] Available at: https://www.nibusinessinfo.co.uk/content/business-benefits-corporate-social-responsibility [Accessed December 2, 2014]. Flat World Education, Inc, 2014. Flat World Education, Inc. Should Corporations Have Social Responsibilities? The Arguments in Favor. [Online] Available at: http://catalog.flatworldknowledge.com/bookhub/reader/1695?e=brusseau-ch13_s03 [Accessed December 2, 2014]. Hearst Newspapers, LLC, 2014. Importance of Creating a Code of Ethics for a Business. Small Business. [Online] Available at: http://smallbusiness.chron.com/importance-creating-code-ethics-business-3094.html [Accessed December 2, 2014]. Hooker, J., 2004. The Case Against Business Ethics Education: A study In Bad Arguments. Journal of Business Ethics Education, Vol. 1, pp. 75-88. Scribd Inc, 2014. Business Ethics. What is Ethics. [Online] Available at: http://www.scribd.com/doc/17001256/Business-Ethics [Accessed December 1, 2014]. Social Media Today LLC, 2012. Benefits of Corporate Social Responsibility. Sustainable Business. [Online] Available at: http://sustainablebusinessforum.com/sbtoolkit/179556/benefits-corporate-social-responsibility [Accessed December 2, 2014]. Read More