Unethical Performance Evaluations - Coursework Example

Academic Organization Your Workplace Injustice: Unethical Performance Evaluations Hindering Employee Advancement Introduction Understanding that the basis of ethical behavior in the workplace is founded on social principles of right versus wrong, contemporary expectations for business ethics are instrumental in providing standards or guidelines for the conduct and decision making for management. Today, significant scrutiny is placed on business leaders to promote high levels of corporate social responsibility in terms of providing adequate contributions to sustaining the interests of the external stakeholder. In many instances, it is this externally-driven set of ethical demands which prompt an organization to develop a code of ethics by which it publicly expresses its efforts and intentions to conduct its business activities with morality, fairness and decency. However, it is often the internal stakeholder, that being the employee, who falls victim to unethical managerial practices in terms of experiencing injustice in performance evaluation as well as receiving inadequate performance compensation due to a phenomenon known as cronyism; a significantly unethical managerial behavior. Cronyism can be best defined as favoritism shown by a superior to his or her subordinate based solely on their personal relationship, rather than by assessing the employees true capability or qualification (Khatri & Tsang, 289). This suggests a reciprocal relationship of exchange where managers grant higher performance compensation and more positive employee reviews in exchange for the subordinates loyalty. The result of this unethical practice: Employees adversely affected by cronyism, especially those who do not have a sound interpersonal relationship with the assessing managers, miss out on opportunities such as promotion or the receipt of fair compensation for their legitimate contributions to the organization. If left unchecked, this type of favoritism can lead to long-term, internal organizational disloyalty from slighted employee populations and promote overall inefficiency leading to a distorted organizational culture built on relationships rather than promoting contribution to sustaining company goals. Managers set the tone for organizational culture, especially in terms of providing an ethical climate by which employees measure their own actions, thus the indication is the cronyism can sustain high detriment to employee satisfaction or motivation to perform. Further, when cronyism is apparent in the performance evaluation process, it can be attributed to a trend known as rater bias, where the assessing managers own values or prejudices significantly distort the performance analysis. Oftentimes, this bias is quite intentional (Mathis & Jackson, 360). In a typical performance review, an employee receives feedback regarding his or her strengths or weaknesses which summarize their eligibility for advancement or reward remuneration. When a manager uses highly subjective criteria in their assessment of employees, based on favoritism, an ethical boundary has been crossed, leaving those employees who fall victim to this bias with little recourse to rectify the problem. Thus, they become entangled in a proverbial web of managerial corruption which will likely, long-term, impact the performance levels of the company; as research indicates that sound corporate social responsibility is related to higher financial performance (Gomez-Mejia et al, 124). This project will explore the ramifications of this highly controversial and subjective breach of ethical conduct in terms of its impact on the employee population and to the long-term performance of modern companies. Moreover, proposed methods to secure managerial compliance to ethical standards will be discussed as a means to regulate the process of employee performance analyses. Employee Perspectives on Unethical Performance Analyses The concept of examining the fairness of rewards within an organization is attributed to a term known as distributive justice in business ethics (Gomez-Mejia et al, 105). Employees generally want to be treated fairly and with considerable respect while at the same time desiring ample work opportunities which will advance their careers. When an employee perceives injustice via rater bias or cronyism apparent in their unethical performance analysis, the likely result is intention to leave the organization based on perceptions of being unable to rectify the issue through appropriate managerial systems. A study conducted in 2000 by the Society for Human Resource Management suggests that 46% of respondents indicated that their reason for voluntarily leaving an organization was due to unethical management practices and discriminatory treatment (Mathis & Jackson, 81). These are somewhat sobering statistics, which support the idea that unethical managerial behaviors are often the catalyst for an employees intention to leave a firm and that unethical management actions are somewhat widespread in the business environment. Bias, in itself, is a multi-dimensional and very complex issue, and for this reason is often substantially difficult for an employee to prove that it has occurred (ASNE). Depending on the particular organizational policies of various firms, an employee must be able to provide adequate justification for demanding an inquiry into a perceived unethical performance evaluation. Proof of cronyism is often impossible to provide as it is an abstract behavior and generally cannot be substantiated using traditional evidence. For this reason, and with statistics supporting its regular occurrence in modern business, many managers are allowed to continue with the practice indefinitely. As previously mentioned, when managers provide adequate performance rewards to their subordinate acquaintances, they are often expecting reciprocal favors to be performed by the employee as acknowledgement of the managers unethical assessment. Generally, these favors are conducted in relation to higher departmental contribution or excess loyalty and support. Under the assumption that most employees base their level of contribution to the business as being a catalyst for workplace opportunities in the pursuit of career advancement, those employees who are not granted ample opportunity to perform similar favors for the manager become stuck in their current position without being granted the chance for promotion. These jilted subordinates are often forced, literally, to simply sit idle and watch as a peer associate is granted considerable favoritism with little means at their disposal to correct the situation. In a worst case scenario, the managers favorite associate is granted a series of subsequent promotions without having contributed anything substantial to the organization, but only to the manager. The result can potentially create an inefficient hierarchy of management that jeopardizes the business interests long-term. With all of this being said, this reverts back to the business maintaining the responsibility to ensure that the performance analysis process is clearly defined within its policies pertaining to ethical managerial behavior, as the financial cost to increasing turnover rates is exceedingly high and will impact the firms profitability. As part of managements responsibility to secure the needs of the stakeholder, the process of performance evaluation should be given high levels of executive governance and monitored to observe unethical employee assessments. Leadership Perceptions on Performance Analysis Responsibility Managers might argue that regardless of how hard they try, their efforts in providing a fair performance analysis will always be deemed unfair by subordinate associates (Employee Benefits Magazine, 18). Managers might further justify that their assessments of their subordinates are based strictly on performance attributes alone, and that the ethical concerns raised by slighted employees are simply retaliation to remove focus from their individual performance weaknesses by attributing unethical behavior to the assessing manager. Further, American economist Milton Friedman suggested that the only true corporate responsibility of business is to make money for stockholders (Nickels et al, 112). With this in mind, contemporary business leaders and followers of the Friedman position on business and ethics might take an opposing position regarding the internal stakeholder and deem that control mechanisms in performance evaluation are unnecessary steps so long as the firm remains profitable to its investors and complies with established legalities. There are virtually unlimited amounts of explanations through which managers who engage in cronyism or acquaintance bias can justify their analysis methods, as proving indiscretion in performance reviews is substantially difficult. Moreover, these same managers may be able to offer concrete evidence to support their decisions to advance a favorite employee by offering that the subordinates contribution to the business justifies the reward, where in reality the manager is simply twisting the order of events: The employee favors were actually conducted as acknowledgement of their superiors positive assessment, however the manager provides this contribution as the original cause for reward. Proposing Methods to Control Unethical Managerial Actions When senior-level leadership notices a significant decline in subordinate loyalty to the firm or its mission, the business must take appropriate action to uncover the reasoning behind diminished organizational commitment. Companies, today, rely on the unified actions of both employees and managers as part of a cohesive organizational culture who provide the business with the resources it needs to sustain a competitive and profitable future. To determine whether employees perceive unethical managerial conduct as the root of their disloyalty, a modern approach to diagnosing these problems can be accomplished through an attitude survey. This type of formal questioning mechanism is designed to focus around employees beliefs and feelings about their jobs and to organize statistics about perceptions of organizational policies and managerial practices (Mathis & Jackson, 91). If a majority of employee responses to the attitude survey indicate a perceived unethical situation regarding distorted performance analyses exists, leadership can build a solid case by which to halt the practice of rater bias or cronyism. Further, leadership which determines that its publicized ethical image in terms of corporate responsibility is being tarnished by unethical internal practices, the industry can create a multi-level assessment program in order to ensure that employees receive a much broader performance analysis through a ratings system which involves more than a singular manager, but encompasses a variety of staff to whom the employee is continuously exposed. This can include peer assessments as well as the opinion of various managerial staff members. In another respect, business leaders who legitimately recognize that cronyism is a significant problem within the process of building a competent managerial hierarchy through promotion maintain the ability to restructure its corporate code of ethics to emphasize the issue of performance analyses. In many situations, the code of ethics is designed to be a well-publicized statement of ethical expectations, but is largely focused to provide superior corporate responsibility to the external stakeholder. Clearly illustrating the guidelines for managerial adherence to effective performance systems will accomplish two very specific goals: First, to illustrate to subordinate staff that the firm values the employee and, more importantly, to emphasize that there are repercussions for utilizing personal bias in the administrative distribution of compensatory rewards. The insertion of a statement which addresses this very real problem in modern business would be a significant step in bolstering the commitment to organizational performance and ensuring compliance with ethical expectations. Conclusion Companies, especially those who trade publicly, do actually owe their stockholders a significant commitment to performance and profitability. When the internal activities of a firm are not complying with ethical standards, and the industry is providing insufficient financial returns due to poor performance, leadership must restructure its ethical policies in order to sustain its commitment to investors. In most organizations, it is the management team which dictates forward business momentum and therefore must be built through competent leadership. Individuals which are promoted to leadership positions without proving their merit to the organization will likely be a long-term detriment to fulfilling this obligation as the business is not operating at peak managerial efficiency. In similar respect, today, much emphasis is placed on the significance of establishing a positive internal organizational culture as a means to promote an effective system of teamwork to satisfy strategic goals. When employees perceive bias or unethical colleague advancement, the unfavorable result is diminished organizational commitment and intention to leave; costing the firm a substantial financial investment to train and coordinate employee systems under a high turnover rate. The adoption of the aforementioned control mechanisms designed to satisfy employee expectations of ethical behavior in performance reviews will send the stern message that the firm will take legitimate action for managerial breach of ethical compliance. Thus, the implication is that recognizing and controlling unethical behavior, especially in terms of the methods by which employees are assessed, is a sound investment for long-term growth within an industry. Promoting a solidified ethical code of conduct will not only aid in assuring that bias and cronyism is not tolerated from an internal standpoint, but also send the message to customers, society, and investors that the company firmly believes that it maintains an obligation to promote an internal philosophy of ethical behavior. The outcome of these measures will secure a more positive public image, streamline internal operations, and weed out the proverbial root of corruption within a firms management system. Word Count: 2,077 Bibliography ASNE. Perceived Bias. American Society of Newspaper Editors. Aug 4 1999. www.asne.org/kiosk/reports/99reports/1999examiningourcredibility/p27-32_Bias.html. Employee Benefits Magazine. Viewpoint: Is your HR policy only fair to middling? Oct 10 2005. Gomez-Mejia, Luis R., Balkin, David B. & Cardy, Robert L. Management: People, Performance, Change. 2nd ed. McGraw-Hill Irwin. 2005. Khatri, Naresh & Tsang, Eric. Antecedents and Consequences. Journal of Business Ethics. Dordrecht. Vol. 43, Iss. 4. 2003. Mathis, Robert L. & Jackson, John H. Human Resource Management. 10th ed. Thomson South-Western. United States. 2003. Nickels, William G., McHugh, James M. & McHugh, Susan M. Understanding Business. 7th ed. McGraw-Hill Irwin. 2005. Read More