Employees Control by Business Ethics - Case Study Example

Business Ethics Name of Student Name of Professor Institution Course Title Date Introduction Companies and organizations often have the actions and behaviors of their employees controlled by business ethics. Andersen points out that the main aim of starting or establishing a business is to make profits. Therefore, when the business ethics in a company or organization are strictly followed, without doubt, lots of profits will be incurred. What is business ethics? Business ethics has been defined in various ways. One definition of business ethics is that it is the behavior that a business is expected to follow once it is operative and interacts with other businesses in the world of business. Besides, another definition of business ethics is that it is a form of ethics that arises in companies, institutions or other business environments in case of problems or challenges. Boldrin and Levine agree that: Business ethics play a big role in making sure the operations in business environments are straight and not destructed by sideshow activities. Unethical behaviors in business environments include misconducts among the employees, misappropriation of funds by the bosses and poor relationships between the employees and the managers. When the managers misappropriate funds to benefit themselves, this is termed as unethical behavior and it might lead to the fall of the business. Moreover, misconducts among employees can also be termed as unethical behaviors as they can also lead to the fall of the business. It is important for all the stakeholders in a business organization to follow the business ethics. Undoubtedly, this is a difficult task but once adhered to; it is most likely that a particular business will be successful. Case study In the case study “Why Didn’t we know”, Galvatrens which is a Houston-based consumer products company is presented as a company with wrangles between the managers and the employees. The company has a leading director known as Arch Carter. There are several stakeholders of the company; one of them is known as Chip. The company has been accused of terminating the contract of one of its employees unexpectedly. Therefore, the individual whose contract was terminated (Mike Fields), decides to sue the Galvatrens Company. Mike Fields accuses Greg Wilson, a member of staff in the company of getting involved in the termination of his contract. Mike also accuses the company of manipulating their sales numbers, a big offence in the world of business. Mike Fields later on adds that the company has a weak system of uncovering misconducts and that the weak system needed to be strengthened. At first, when the company is established, there is good relation among the workers. This good behavior enhanced the business ethics in the company and it recorded big profits. However, as time went on, there were wrangles among the employees and this destabilized the company, leading to blame games, unexpected termination of contracts and suing of the company by staff members. This was a great setback for the company leading to a significant decline in the amount of profits incurred. In addition, in this case study, Arch Carter the leading director of the company has invested a lot in the company. He looks forward to getting good outcomes from the investment. However, other staff members such as Greg Wilson and Chip have other motives in the company. This causes wrangles between him and Mike Fields who decides to sue the company and raise serious allegations against the Galvatrens Company. Mike Fields also wants to question the reason behind the termination of his contract at the company. Furthermore, Mike wants to uncover the misconduct that is rampant in the company. As much as such an action of suing the company would lead to Mike Fields receiving compensation, it is accompanied by several complications because of the pressure that will be mounted on the company. The possibilities that other employees will be retrenched and the company disbanded are very high. The question asked at the end of the “Why Didn’t we know” case study asks how the Galvatrens Company should strengthen its system for uncovering misconduct and what roles the board and the management should play in the process. According to personal opinion, there are several ways in which the Galvatrens Company can strengthen its systems for uncovering misconduct among their employees. To begin with, Jones and Parker point out that one way in which the company can uncover misconduct is by installing CCTV surveillance cameras within the company. Among the allegations against the company was that one of the senior divisional sales managers, Greg Wilson proposed to ship goods to a few of his bigger customers, billing them, and booking the sales but with an agreement that they would not have to take ownership, could return the shipments at any time, and would get a 2% discount on any goods they accepted and paid for in the following quarter. This misconduct within the company should be uncovered. Therefore, if CCTV cameras were installed within the company, the proposed shipping of goods within the company would have been uncovered and thus the vested interests from some individuals would have been gotten rid of. Had this been prevented, workers like Mike Fields would not have accused the company of such like allegations. The other way which the company should employ to uncover misconduct within the company is by enhancing good relations among the employees and providing rewards for individuals who report misconduct within the company. In the Galvatrens Company, there were several misunderstandings and poor relations between the staff members. For example, Mike Fields and Greg Wilson were antagonistic. Mike opposed Greg’s proposed shipping of goods from the company to customers with personal vested interest. Considering this fact, if the employees within the company had good relations and existed peacefully, such cases of shipping of goods would not have occurred. Furthermore, the directors would have been providing rewards to employees to oversee the operations within the company. In this way, the board and the management will have strengthened the company’s system for uncovering misconducts. Additionally, the other way that the Galvatrens Company should use to strengthen its system for uncovering misconduct is through mass media and social media. The mass media is a very viral means of communication with the ability of uncovering secretive information. Therefore, misconduct such as the unexpected termination of Mike Field’s contract would have been uncovered through the mass media. Besides, the use of social media would also be very helpful and influential in the uncovering of any kind of misconduct within the company. The social media includes platforms such as Face book and Twitter. When such platforms are taken seriously, the benefit will be to the company as the possibility of engaging in malpractices and misconducts in the company will be reduced significantly due to fear of getting exposed to the authorities and to the public. Use of forensic tools and investigation could also be very helpful in strengthening Galvatrens’ system for uncovering misconduct. Though this is kind of expensive, forensic investigations have been efficient and thorough in the uncovering of misconducts in various companies. In most cases, the victims of misconduct in companies are caught and charged for the act or behaviors. If this is introduced in the Galvatrens Company, it will prevent immature termination of contracts of employees because of the possible charges. Besides, if introduced, there will be no underground ill motives and vested interests among employees such as Greg Wilson who planned to ship out the company’s goods without the knowledge of the relevant authorities. Moreover, in a way, this will enhance the rapport among the employees in the organization and all individuals will be interested in the well-being of the company thus prevent any possible destruction or setback to the company. Application of ethical principles to the case study Libertarianism Bevir Mark and Hamowy point out that libertarianism is an ethical principle that gives an individual the freedom to decide what to do. Moreover, it is a virtue of ethics that respects the liberty of any individual. Libertarians have several different beliefs. However, the beliefs are very important in that all emphasize on maximization of liberties and political freedoms of individuals. According to libertarianism, Mike Fields has the freedom and liberty to sue the company and to bring forth serious allegations against the company. In this case, suing the company would mean that those with vested interests on doing illegal operations with the company’s property are charged. Besides, suing the company would serve as an example for the management and board to halt their misconduct of terminating the contracts of employees unexpectedly. In the case study, Arch Carter, as the leading director of the company has the freedom and liberty of making choices and decisions that will run the company. For example, Machan argues that leading directors in companies have the freedom to sack or retrench members of his staff who he feels are not productive enough. He proved this freedom and liberty in decision making by terminating the contract of one of the employees, Mike Fields. The leading director makes decisions and choices own his own without taking into consideration the dire consequences of his actions. In the case study, libertarian virtue of ethics is also evident whereby Greg Wilson uses his freedom and liberty to ship out the property of the company to other customers for his own benefit. By doing so, Greg exposes the company to a risk of losses or failure. However, he does so without considering the consequences of his actions. Utilitarianism Another ethical theory that can be applied in the “Why Didn’t we know” case study is the theory of utilitarianism. Harwood argues that: This theory believes or rather proposes that the course of an action emphasizes on the overall good of individuals. In addition, utilitarianism believes that the moral worth of an action depends on the consequences of that particular action. That is to say, the consequences or outcomes of an action determine whether the action will be done. In regard to utilitarianism, Mike Fields should not have sued the company because of the implications that accompanied the company after. Initially, the operations and dealings in the company were normal not until Mike Fields decided to raise serious allegations against the company. This action destabilized the company and there were disagreements among the staff members. The other consequence of Mike’s action was that it led to incurrence of losses within the company. Furthermore, in regard to utilitarianism, Arch Carter, the lead director of the company should not have terminated the contract of Mike Fields without considering the impacts that the action could have brought to the company. To begin with, termination of Mike’s contract has resulted to the company being sued, increase of incidences of misconducts within the company and incurrence of losses due to loss of customers. Additionally, in this case study, Greg Wilson shipped the goods of the company to other customers without considering the impacts or consequences that it would have on the company. Undoubtedly, shipping of goods would cause great losses for the company. This is because the normal dealings and operations that would bring profits to the company were hijacked. Greg Wilson was also had poor relations and this had an impact as his actions were uncovered. Deontology Gay points out that deontology is a virtue of ethics that judges the morality of an individual’s actions considering the fact that they follow the rules set in a certain organization. In this case study, deontology could be used to judge the morality of the actions of individuals within the Galvatrens Company. In regard to this study and the deontological framework, there are no rules in the company that allow vested interests among employees of the company nor underground business transactions as in the case of Greg Wilson proposing to ship out the goods of the company to other personal customers. Suppose there were rules, then Greg could have been forced to make decisions that are inclined towards the morality of his actions. Without doubt, the step of shipping out the company’s goods was not morally acceptable by the company. As a result, the immoral behavior or misconduct demonstrated by Greg Wilson brought chaos and disagreements among employees in the company. Greg was focused on personal interests and gains yet the most important thing was the interest of the company. By deciding to ship out the company’s goods, Greg has gone against the norms of the company. Virtue Ethics This is an ethical perspective of ethics that believes that the ethical behavior of an individual is driven or determined by the character of that individual. It opposes the fact that rules or social context determine behavior. In regard to this case study, the ethical behavior of Grey Wilson of shipping out the company’s goods is not determined by rules or social contexts but rather by his character. Grey Wilson comes out as a greedy individual with personal interests and not the interests of others. Therefore, his character prompts him to do illegal business dealings and operations. The outcomes of his operations are disastrous and a big challenge to the existence of the Galvatrens Company. Other theories Other theories that can be applied in this case study are rationalism and reasonability. To start with, rationalism can also be applied in the sense that the managers and employees in the organization need to be rational in all decisions that they make. Arch Carter, the leading director of the company should first think before deciding to terminate the contracts of employees as was done to Mike Fields. Kamm indicates that termination of contracts could come with several negative impacts that could be a setback to the development of the company. Additionally, Greg Wilson should not led greed or personal interests to drive him to make wrong decisions such as shipping out the company’s products. When rationality is applied in this case study, the strengths and weaknesses that accompany the actions of individuals will be acknowledged and therefore the best decisions can be arrived at. The other ethical perspective that can be applied in this case study is reasonability. It can be applied in the sense that Chip and Greg Wilson should apply good reasoning to the situations that they are facing so that they can up with amicable solutions to prevent the fall of the company’s business. Besides, the management and the company’s board should use reasoning before terminating the contracts of their employees. If good reasoning is put on the forefront in the operations and activities of the company, the allegations and problems that the company is undergoing will not be experienced in future. Conclusion To sum up everything, ethical theories are used in any business environment. The major role they play is that they help to solve any problems or challenges that may arise in the business environments. For example, in this paper, the case study about strengthening Galvatrens Company’s system for uncovering misconduct has been reviewed by various ethical perspectives such as libertarianism, utilitarianism, and deontology and virtue ethics. If these ethical theories are properly put into practice, then the problems and challenges that the company is experiencing at the moment will be solved. Ethical theories also enhance the development of business operations and dealings. Works Cited Andersen, B. Intellectual Property Rights: Innovation, Governance and the Institutional Environment. Chicago: Edward Elgar Publishing. 2006 Bevir, Mark. "Libertarianism" Encyclopedia of Political Theory. Thousand Oaks, California: Sage Publications. 2010 Boldrin, M, and Levine, D. K. Against Intellectual Monopoly. Cambridge: Cambridge University Press. 2008 Gay, John. "Concerning the Fundamental Principle of Virtue or Morality". In Schneewind, J. B. Moral Philosophy from Montaigne to Kant. Cambridge University Press. 2002. p. 408. Hamowy, Ronald. "Sociology and Libertarianism". The Encyclopedia of Libertarianism. Thousand Oaks, California: SAG E Publications. 2008 pp. 480–482 Hamowy, R, Kuznicki, J, and Steelman, A. The Encyclopedia of Libertarianism. Los Angeles: Sage Reference. 2008 Harwood, Sterling. "Eleven Objections to Utilitarianism" Indianapolis: Hackett Publishing Co. 2003 Jones, C, and Parker, M. For Business Ethics: A Critical Text. London: Routledge. 2005 Kamm, F. M. Intricate Ethics: Rights, Responsibilities, and Permissible Harm. New York: Oxford University Press. 2007 Machan, T. R. The Morality of Business: A Profession for Human Wealth care. Boston: Springer. 2007 Read More