Mystery Shopping, Marketing and Managerial Ethics - Coursework Example

INTRODUCTION Mystery shopping is defined as a tool used by watchdog organizations or applied by market research organizations to investigate or source for information regarding the quality of services delivered by employees in a particular organization (Van der Wiele, Hesselink and Van Iwaarden, 2005). This tool can also be applied by companies internally to measure compliance to regulations as well as measuring the quality of services delivered to the customers. Mystery shopping is also used widely by companies to gather particular and specific information required by the organization about the quality of its services and products (Shing & Spence, 2002). Business ethics refers to the behaviour or conduct of the business when dealing not only with the external world but also on the way the business interacts or deal with individual customers (Hooker, 2003). Even though mystery shopping has become a widespread phenomenon used by organizations to measure the quality of services delivered to the customers, the issue of ethics in mystery shopping has come to the limelight. The purpose of this paper is therefore to investigate whether mystery shopping is ethical or not. BUSINESS ETHICS Business ethics is viewed as the standard upon which ethical or moral problems that arise in the company can be measured. Business ethics touches on the conduct of the organization as well as the conduct of individuals in the organization. Business ethics is also defined as the philosophy that guides the operations of the business (Murphey & Laczniak et al 2007). From this angle, business ethics is seen as one way of determining the fundamental aims, purposes and goals of the company. Positive business ethics should form the foundation of every business. This means that appropriate behaviour and conduct should be exercised when making money. For instance, exploiting customers through unjustifiable price hikes in order to make profit is not a positive business ethics (Schneider, Hanges, Smith and Salvaggio, 2003). In order to achieve wider ethical compliance, many organizations formulate internal policies regarding their employees conduct. Such policies range from generalized language or ethics statement to detailed policies that spell out the specific behaviours required to be exercised in the organization or the company’s code of ethics. These internal policies help to identify the expectation of the company towards its employees and to provide guidance on how ethical problems originating from business activities should be handled (Watson, 2003). It is believed that internal policies will lead to application consistency, greater awareness about ethics in business and that internal policies will help in avoiding ethical disasters. VIEWS ABOUT BUSINESS ETHICS Different views have been postulated relating to business ethics. From the deontological perspective, business ethics is viewed as a way of recognizing duties and undertaking business activities based on that which is moral. This means that an action can either be wrong or right (Market Research Society, 2003). From Bentham (utilitarianism) view ethics is viewed as a way of bringing about the most common good for the community (Jesson, 2004). This means that a business action can be regarded to be ethical when it increases the happiness of those affected as well as increasing the happiness of the greatest number of people. For instance, if the company seeks to increase the shareholders return by not engaging in earnings management, this can be regarded as ethical behaviour in business because the aim is to increase the happiness of the greatest number of people (Miller, 2006). From the Kantian view, ethics is the rational action that brings equality in any given setting because individuals don’t make an exception for themselves. For example, in the organizational setting, promotion of both female and male employees is in Kantian view, sensible (rational) because it brings equality in the organization. A number of tools have been proposed that ensure business ethics is upheld in the organization. Such tools include the code of practice that spells out the requirements of the organization towards the employees (Hesselink & Van der Wiele, 2003). For example, the code of practice may spell out the need for certain principles such as collaboration, cooperation, innovation, flexibility and inclusion to be upheld by the company employees (Calvert, 2005). HUMAN RESOURCE PERSPECTIVE From the human resource perspective, business ethics is viewed as the most appropriate avenue for enhancing a positive work environment by promoting certain initiatives such as back-to-work programs and family-friendly working environment (Hesselink & Van der Wiele, 2003). Business ethics is viewed as the guide to the line managers in the workplace to perform their duties by observing the laid down regulations and legislations such as exercising fair dismissal in the workplace. Business ethics is also an avenue used to promote benefits in training and development by ensuring that good processes are applied when dealing with the employees in the organization (Hesselink & Van der Wiele, 2003). Hence, from the human resource perspective, business ethics is a worthwhile approach to enhance a positive work environment in order to achieve organizational goals. In order to gauge and evaluate the standards, applicability and suitability of the tools used to uphold business ethics, companies apply different methods (Hesselink & Van der Wiele, 2003). One of the methods used by organizations is mystery shopping. IS MYSTERY SHOPPING ETHICAL? One of the greatest objectives companies strive to achieve in their operations is delivery of quality services to the customers in order to increase the satisfaction levels of the customers (Fitzsimmons & Fitzsimmons, 2004). This does not only enhance a positive word of mouth about the company but it also increases the number of repeat customers into the business. This is only possible when business ethics is upheld in the company. Hence, mystery shopping helps to strengthen business ethics by gathering key information about quality of services delivered to the customers by the company employees, the employee attitudes when delivering services to the customers and professionalism when addressing concerns and complains from the customers (Fitzsimmons & Fitzsimmons, 2004). Hence, mystery shopping provides the company with information that can help improve the quality of services delivered to the customers and a tool used by the human resource management to identify areas of weakness in order to develop methods for improvement. From the utilitarian perspective, ethics is a way of bringing common good to all. This means that objective of ethics should is not to benefit a few individuals (Fitzsimmons & Fitzsimmons, 2004). From the company’s perspective, employees make a small segment of the population served by the company. Hence, when used in the company, business ethics aims at bringing common good to the greatest number of people including the employees, shareholders and other stakeholders. Mystery shopping is therefore ethical because it is a business ethics tool used to evaluate the performance and the conduct of the employees that affects the greatest number of people in the organization (Jesson, 2004). Using mystery shopping, the human resource management can increase the satisfaction levels of the customers, shareholders, suppliers by enhancing the delivery of quality customer service to the greatest number of people. Mystery shopping is ethical because it does not evaluate outcomes rather it evaluates processes. This means that the employee is evaluated when services to the customers. Hence, mystery shopping fills the gap such as “misremembering” on the part of the customer left by other customer survey methods (Collins & Turner, 2005). Hence, the quality that stands out as an obstacle to the delivery of quality services is evaluated by the mystery shopper with an aim of eliminating or improving on it. Mystery shopping can be viewed as a method of evaluating the genuine and heartfelt desire by the employees to deliver quality customer services as well as a tool used by the human resource management to identify areas of weaknesses that require improvement. Furthermore, mystery shopping is ethical because it does not collect perceptions rather it helps in the collection of facts. The checklist or the questionnaire used by the mystery shopper contains objective data that helps in gathering facts (Collins & Turner, 2005). This aspect is an advantage over other survey methods because in other methods, the customer gives information about their impression regarding the services offered to them and not the individual transactions and elements contained in the process of service delivery (Collins & Turner, 2005). As mentioned above, mystery shopping is ethical because it can be used as an identification tool for determining the areas of training. This helps improve the quality of customer service and makes it possible for the human resource management to further develop the staff skills through training and development. In spite of the above positive aspects of mystery shopping, research has shown that it can be viewed negatively by the employees particularly when the staffs view mystery shopping as an avenue used by the management to institute disciplinary action against them (Mystery Shopping Providers Association Europe, 2004). In the eyes of the staff, mystery shopping ceases to be a tool for improvement, training and development and becomes a tool for investigation in which mistakes preformed by the staff are identified and disciplinary action taken against them. The quality of customer service is also affected since employees are never aware of who will be picked next for disciplinary action. The positive relations between the staff and the human resource management are impacted negatively due to mistrust that crops up between the staff and the people in HRM. Research shows that mystery shopping is only used to measure process and not the outcome of the process (Collins & Turner, 2005). Hence, for services that comprise intangible and tangible elements such as restaurant service, the mystery customer may only pick the quality of the service and fail to pick the quality of the food served to him/her. This is a shortfall that makes mystery shopping viewed negatively by the employees in the company because it picks the intangible part of service delivery and fails to capture the tangible part of service delivery. By capturing the intangible side alone, the human resource management fails does not uphold the element of fairness in the organization which further impacts negatively on customer service. Additionally, mystery shopping is unethical because it captures only a short “snapshot” of service delivery process (Mystery Shopping Providers Association Europe, 2004). This means that information obtained through the mystery shopping process is not representative. As a result, negative feedbacks from the company management may be distributed to the company staff based on mystery shopper experience that may de-motivate and discourage the staff from performing their duties effectively in the company (Jesson, 2004). Mystery shopping is therefore unethical because it may impact negatively on customer service as well as the relationship between the staff and the human relations management department in the company. ROLE OF HUMAN RESOURCE Human resource management (HRM) fits in where the unethical practice or poor practice has far reaching effects on customer satisfaction (Bromage, 2000). For example, the human resource management fits in the fields such as medicine, engineering and law where poor practice may cause death of the patient and loss of funds. In such fields, human resource management ensures that business ethics is upheld by instituting such tools as organizational values and the business code of conduct that must be observed by all the employees (Bromage, 2000). This is possible through the use of mystery shopping that helps in the identification of weakness areas that can help HRM institute methods for improvement. The duty of the human resource management(HRM/ER) when ethical standards are breached is to report to the company management areas that need improvement and the most appropriate methods which can be used to achieve the required goals (Bromage, 2000). The reason for this is that the human resource manager works for the entire majority of the people served by the company. This includes customers, shareholders, suppliers and any other stakeholder directly or indirectly affected by the company’s activities. The duty of HRM/ER is to train and adequately inform the staff/employees about the need to adhere to the laid down code of practice and conducts and the repercussions for failing to do so. An ethical manager is the one that works for the common good of the greatest number of people by ensuring that the greatest number of people (customers, shareholder and stakeholders) is happy with the quality of services received from the company. An ethical manager leads his employees in strictly observing business ethics in aspects such as code of dressing, communication and respect (to mention a few). An ethical manager acts professionally. A professional is therefore made by the desire and the urge to uphold ethical standards and not just the academic qualifications held by a person (Bromage, 2000). Professionally and ethically, competing interests can be reconciled by exploring means that bring a common good to the majority. For instance, the manager can act professionally by avoiding earning management practice and ethically by increasing the shareholders return. Thus, competing interests between the company management and the customers is reconciled by exploring means of upholding common good of all the company stakeholders. In conclusion, it is evident from the positive and the negative aspects of mystery shopping that mystery shopping has more advantages than disadvantages. This means that mystery shopping is ethical because it serves as a tool aimed at improving the process that lag behind rather than being a tool for investigation. As seen above, mystery shopping aims at brining a common good to the greatest number of people through quality service delivery (customers, suppliers, shareholders). Hence, it is an ethical means of identifying areas of weaknesses for improvement purpose. References Bromage, N. (2000). Mystery shopping – It’s research, but not as we know it, Managing Accounting, Vol 78, No.4, pp. 30. Calvert, P. (2005). It's a mystery: Mystery shopping in New Zealand's Public Libraries, Library Review, Vol.54, No.1, pp. 24-35. Collins, J., and Turner, H. (2005). The new truth about mystery shoppers. The Wise Marketer, March, available online at www.thewisemarketer.com Fitzsimmons, J., & Fitzsimmons, M. (2004). Service management: Operations, strategy and information technology, McGraw-Hill, New York Hesselink, M., & Van der Wiele (2003). Mystery shopping: In-depth measurement of customer satisfaction, ERIM Report Series Research in Management, ERS-2003-20- ORG, March. Hooker, J. (2003). 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