Main Peculiarities of Business Ethics - Assignment Example

Business Ethics Why does a socialist regard all vital property as public (or collective)? What are some problems with this idea, if anything? Socialism is an ideology that is based on the shift of ownership from private to the public control of property and natural resources. Socialist argument against private ownership is based on the beliefs that individuals do not live or work in isolation from the rest of the society but their success is based on cooperation with one another. Goods and services are seen as social products therefore making it necessary that everyone who has an input in production process to have a share. Given this belief that people should share the output of their industries, socialists are in opposition of capitalist production that is best on the quest for profit for the proprietor alone. Socialism is against production for profit which is blamed as part of the basis for exploitation of the working class by the capitalists. Socialists blame economic inequalities that exist in society on capitalism which has made it possible for owners of means of production to exploit the workers. This exploitations better explained in the Marxist concepts of the bourgeoisies and Proletariat where the former are capitalist, industrialists or management; a group that is in control of essential means of production while the proletariat represents the working class earning their income from wages derived from their labor to the industrialists (Patsouras, 2005). Consequently socialists blame capitalism for the trend where goods and services are not produced for consumption by the people but for sale to gain profit. Making vital property privately owned means it is only those who can afford them that will enjoy due to the high cost of goods and services attached by the capitalist owners. The working class is therefore locked out of some of the benefits of their work as they are only paid for a fraction of the energy used in production. Under socialism the workers also own the industry and get to make decisions on the running and how outputs are shared. The role of the government in socialist states is to empower the people to control the production and sharing of the wealth generated from their efforts. Given that everyone has an input in the production process, the government serves to ensure everyone is rewarded for their contribution through collectively own and democratically operated means of production such as industries and social services. For instance, the workers are given an increased role to play in the management of the industries through established processes where the rank and file workers are empowered to designate their own instant supervisors and administration committees. Participation of workers in the economy is further enhanced through the election of worker representatives to assemblies of the business or service at both local and national levels of representation for the economic sector in which they work. These assemblies are necessary in making of decision over production and distribution of all goods and services throughout the country (Harrison, 2013). Even as socialism promises to provide answers to some of the social problems that are generated from capitalism, the concept of collective ownership advocate by the ideology has also been criticized based on a number of factors. Among the identified drawbacks of collective ownership is that is does not encourage entrepreneurial development therefore resulting in slow growth of the economy and reduced level of competition within the society. Since people are not driven by the urge to produce more and accumulate increased returns compared to others, they are not stimulated to think of new ideas that will make thermo better than others. Additionally, the government has all the power to allocate people to specific sectors that they are deemed to be well suited which means people lack the freedom and right to own and exchange goods and services based on the natural production and the market exchange (Harrison, 2013; Patsouras, 2005). 2. What is outsourcing? Why is it criticized (what objections do people have to it) and what responses can one make to the criticisms? Outsourcing is a practice that involves transferring portions of organizational functions to an outside supplier instead of maintaining such functions within the organization. Companies view outsourcing as an important aspect of their functions where goods or services that are considered noncore are given to other companies to supply with this move being perceived as necessary to free up financial resources, human resource, time, and facilities for functions that the company holds competitive advantage. Consequently, outsourcing is an important approach for organizations that need to maintain their competitive advantage over competitors as it ensures the organization does not waste resources on production of goods and services that can be made available from other organization at a lower expense (Miller, 2009). There is concern from customers and management over the ability of the outside companies meeting the quality that customers are accustomed to. In this case, outsourcing is seen as a means of cutting cost while compromising quality of goods and services offered. Concern is specifically high for goods and services that are outsourced from third world countries which are thought to be less developed in their structures therefore compromising qualities of output. Organizations that outsource some of the goods and services for customers have to assure them that such a move was not motivated ony by financial reasons but to also continue offering their best. However, criticism of outsourcing based on the quality of services can be countered by the fact that outsourcing is a measure to create efficiency by shifting production of specific goods and services to organizations that posses the expertise. The organization will seek to maintain its credibility by outsourcing from organizations with the expertise to produce goods and services to march levels that customers are used to (Miller, 2009). Outsourcing is seen as a measure that removes control over production from the organization. The company providing the outsourced goods and services has control over the production process making it difficult to react to customer issues that should be addressed within a short time (Sople, 2009). This might compromise the essential services offered by the main firm since customers might not be aware of sections that had been outsourced and those that have been maintained. Outsourcing in this case is seen as more expensive due to the risk it creates in cases where decisions should be made in short time. However, this criticism is countered by the argument that the organization does not outsources essential services that might put jeopardize the entire organizational functioning. Most of the organizations also have a contingency plan that they can revert to in case the company offering outsourced goods and services does not meet the set standards (Miller, 2009). Outsourcing increases job insecurity within the organization and at the national level as increased number of functions are outsourced with focus on competitive advantage and not creation of employment. An organization that seeks to outsource some of their services will have to end their contracts with employees whose functions the organization does not provide anymore. This problem becomes rampant when many organizations in country revert to outsourcing as a strategy for competitive advantage (Clickm and Duening, 2004). However, outsourcing can stimulate the economy therefore increasing job opportunities by creating an environment where all the functions are based on efficiency. Efficiency increases quality and market share for the goods and services produced thereby enabling employment of more workers for the essential services (Miller, 2009). 3. What is the market failure argument (2 parts) for government regulation? Market failure argument for government regulation is based on the belief that the market should involve a combination functions defines the boundaries between what aspects of the economy should be left for the of markets to control and which needs government participation to ensure there are no exploitations within the economy. The government perceives regulations as an effective and efficient measure to mitigate risks that might arise from market failures. Government regulation based on market failure argument is informed by the need to protect individuals from harms that might be done to them by businesses when they seek profit with widespread disregard to human health, environmental protection and other risks (Balleisen and Moss, 2010). Regulation based on market failure argument is therefore a means to firstly promote efficiency in the market through regulation against the establishment of monopolies. The government in this case encourages fair competition with various economic sectors by eliminating anticompetitive practices which disadvantages some of the players in the industries. In cases where monopolies exists, the functions of government regulation is to prevent excess pricing of essential goods and services. Without government regulation, monopolies might charge exorbitant prices with the full knowledge that consumers do not have alternatives but to purchase their goods and services. Additionally, government regulation based on prevention of exploitation by monopolies have the role of ensuring production is based on high quality of goods and services. Monopoly in the market might compromise the quality of goods and services for consumers. Consequently, government regulation in this aspect involves protection of consumers by ensuring the existence of health competition among market players in the industry. In industries where there exist natural monopolies, regulations will be specific to such organizations to ensure the existence of one firm in that economy does not result in exploitation of consumers (Balleisen and Moss, 2010; McEachern, 2011). The second aspect of market failure argument for government regulation is based on the prevention of consumers and their property from harm due to the practices of some business. This involves protection of consumers from harms such as making sure their money is kept safely in the banks where they deposit, food and products are safe and adherer to healthy standards necessary for human consumption or that consumers are not taken advantage of by dishonest merchants, lenders and advertisers among others. Without government regulations, it is argued that some people might take advantage of consumers’ lack of knowledge to exploit them by including some harmful components into processed food which might lead to health complications (Soule, 2003). This form of regulation also affects the properly of individuals from being appropriated illegally by unscrupulous business organizations that might take advantage of some peoples ignorance to defraud them. Although most of the harm that government regulations seek to protect citizens from can be remedied by seeking compensation from courts of law, government regulation becomes an important measure in preventing such acts. Government regulation might also an effective means of dealing with some issue of public harm such as pollution that might be adequately handled on legal basis. Consequently, government regulation in this case is an effective means to ensure protection of citizen health as well as their property (McEachern, 2011). References Balleisen, E. J., & Moss, D. A. (Eds.). (2010). Government and markets: toward a new theory of regulation. Cambridge: Cambridge University Press. Click, R. L., & Duening, T. N. (2004). Business process outsourcing: the competitive advantage. New jersey: John Wiley & Sons. Harrison, B. (2013). Power and Society: An Introduction to the Social Sciences. California: Cengage Learning. McEachern, W. A. (2011). Economics: A contemporary introduction. California: Cengage Learning. Miller, N. (2009). Outsourcing Through Rentacoder. Nicole Miller. Patsouras, L. (2005). Marx in Context. Lincoln: iUniverse,. Sople, V. V. (2009). Business Process Outsourcing: A Supply Chain of Expertises. New Delhi: PHI Learning Pvt. Ltd.. Soule, E. (2003). Morality & markets: the ethics of government regulation. Lanham, Maryland: Rowman & Littlefield. Read More