Discuss about the Ethics Leadership and Decision Making Process.
Managers have the responsibility to lead the company to achieve its goals and objectives. The principal aim of any business is to make more sales which will, in turn, result in high profits margin for the company. Managers or the leaders of any organization have a great task to drive it to a high level enabling it to be competitive in the market. Any decision they made will affect the organization either directly or indirectly and therefore; leaders must be careful in any decision they make in the body. The decision is the determinants of whether the team will succeed or it will fail. Customers satisfaction is the aim of groups as happy customers will come back for more goods and services and also will recommend the firms to friends and family increasing the customer numbers. All decision, therefore, are aims at fulfilling the needs of the customers. Intensive research must be done before any decision is implemented and all parties involved must be consulted to give their opinions. Consequently, these paper will look deeper the decisions that the managers or leaders of the organization make to attract more customers and the consequences. Also, it will look how the decisions are ethical to the rules of the business. (Northouse, 2012).
The organization has a social responsibility of making sure that all the activities it undertakes put into consideration or promote a positive relationship with the stakeholders both those within the organization and those outside the organization. It should do this whether it makes profits or it does not make profits. The stakeholders within the organization include the employees whereas the outside speakers include the community as a whole. Through this consideration, they will be peace between the team and the stakeholders. Conflicts in any business always result in the failure of the structure as the leadership will concentrate on the dispute and forget the primary duty. Managers should always ensure that the business environment is conducive for working by the workers.
Business ethics are the guidelines that the managers use during decision making to know what is right and bad to do or what is acceptable and not acceptable. Managers are always faced with dilemmas' during the decisions they make as they are unaware of the reactions of the customers. Consumers of the company's products are always unpredictable, and it is very hard to know how to please them. Business competition is very high, and managers must be creative and innovative in the decisions they undertake not to lose their customers. The blue ocean strategy is adopted by managers to find markets not concentrated, and these are a method of eliminating competition. It is the wish of any business person to have no competition as this makes the customers have no choice but to buy from the seller no matter the conditions of the products or services they offer. The seller has the monopoly power which he enjoys. Therefore, managers should not be afraid to make decisions and failing, they will learn from the failure and next time makes more informed decision.
The Women-only ridesharing company set to launch in Australia is in a dilemma as to whether the decisions they are making will profitable. The company is set to employ women as its drivers in its transport vehicles. The leaders of the enterprise are violated women who only want women worker. Even though the company has not been yet launched it is experiencing more opposition from the men as they view the move as unfair and illegal. The management, therefore, has a hard task to curb the dissatisfaction among the people. This situation may make the company start and not to have customers enough to ensure its continuity. The decision the leaders make must put into consideration the needs of the potential clients, ethics and also their personal decision-making attributes. If the company managers are happy to satisfy the customers, it will be a good start to future success. They may also use the harmful exposure to their advantage, the company has already gained popularity through the scandals and therefore, it can change that policy and employ all genders persons and curb the dissatisfaction. Its popularity is high among the Australia citizens and its needs only to have a remedy to their cries (Hansen, & Goldberg,1999, pp.495).
Businesses when making ethical decisions they must be aware of various factors; it is very crucial to know the nature of the business they operate in as different businesses needs different decisions. The stakeholders both within and outside the company will determine the success of the firm, and it's important for the managers to know well the nature of their stakeholders to be able to make a decision which they will accept. The management and leadership that an organization has will determine the decisions it will. Creative and innovative direction and management will be able to come up with unique ways of doing things, and this will be detrimental in ensuring business success. Parochial managers will always be afraid of competitions, and this will make the organizations be outdated with no unique products and services to offer to their customers. The driver of the decisions to be done in the body is the objectives and the goals it intends to achieve. These are the motivators for any business to fight competition in the hope that it will be successful and market leader. Location of the firm will also matter on the decision it will make. Factors in the environment are imperative to the managers of decision-making. For example, an organization cannot succeed if neglects men in the society yet they are the greatest buyers or consumers of their goods and services.
There are tools helping organizations in decision making, and they include social responsibility curve, ethical and legal matrix and the pyramid of corporate social responsibility. These tools are used by the managers when making decisions to ensure that they do not make different decisions and scare away customers.
Social responsibility curve
This curve compares the objectives of the business and the social goals. The two variable may also be called egoism and altruism. Egoism represents the interest of the owners of the organization who may also be the managers of the business. The interests of any organizations are to make more profits by attracting more customers. These principles state that a company policy or decision is good when it ensures that the company achieves its goals and objectives without taking into consideration the needs of the customers. The altruism principle takes into account the needs of the customers. The customers' needs are getting fair prices, quality and quantity goods, excellent service, etc. with the aim of their needs being satisfied by the sellers who are the organization's. These principle states that any decision is right if only it ensures customers satisfaction without taking into consideration the situation of the seller.
The two principles cater for the needs of one party without taking into account the position the other party. This conditions will mistreat one party leading to dissatisfaction. Eventually, the conflict will arise making both the parties needs not be met. The best solution so this situation is neither following any of the two principles but come into a situation where no party benefits while the other suffers. For satisfactions, each party must put into account the situation of the other party.
Decisions made by managers or leaders of an organization must be moral and juridical. Moral means that they conform to the accepted norms by the stakeholders whereas legal implies that the decisions follow the laws set by the authority. These two variable are the most important points in any decision-making process (Trevino, 1986, pp. 601-617). The matrix has four quadrants which are:
Ethical but illegal decisions
These are the decisions that adhere to the acceptable norms for both within and outside stakeholders of the business. However, the decisions are illegal meaning that they are against the rules and regulations set by the authorities. These decisions are not right for any leaders as they will end causing trouble which may cause business failure and stoppage.
Unethical and legal decisions
These are decisions which are against the accepted norms for stakeholders, but they are as per the requirements by the authority. Even though this decisions organization can adopt without trouble with the law, they may cause losses to the business. What they may aim of any business is to satisfy the needs of the customers, and if they cannot, it means weak sales to the company resulting in market failure.
Ethical and legal decisions
These are the best decisions as they are accepted bay all the parties involved that is, the stakeholders recognize them and they are as per the requirements of the authorities. These decisions are favorable for any business and best to be undertaken by any manager.
Unethical and illegal decisions
Decisions of this kind are the worst as they are not acceptable by the law and also the also they do not conform to the accepted norms for the stakeholders. The decisions only lead to losses for the company and are of no benefit to the enterprise.
Pyramid of corporate responsibility
Developed by Pride and Terrel these tools identify the areas that are considered when the leaders make any decision for the organization (Carroll, 1991, pp.39-48). The four areas are:
The main aim of any business is to make profits or gains and not losses. Managers should make decisions which will cause success to their activities as it is the primary goal.
The laws of the country set by the authority must be obeyed by the company to avoid trouble. Violation of the set rules and regulations may make the business stop operation or incur high fines established by the business court.
Since the customers' satisfactions is the aim for any business, leaders must check the standards that are accepted and conform to them as they will ensure high customers numbers. Sales of the goods of the products of the organization will increase increasing the profits margins for the business.
Companies operate in the society, and therefore, they should protect the environment and give back to the community. The success of the firm is well spent by giving back to the community like constructing schools, health centers, playgrounds, etc. This action will motivate more customers to buy products and goods and also help create a good image for the organization.
Ethical decision making is critical for the business and despite the different tools used they must have some general factors. The leaders who make decisions traits are crucial in making any constructive decision. Leaders must have moral awareness when making any decision as this will make them know the decisions to take as the know the moral dilemmas they are exposed. Finally, it's appropriate that the managers make the decision which is right and accepted by all the parties.
Ethics, leadership and decision making are dependent on each other to ensure that business succeeds in the activities it undertakes. Leaders have different leadership traits which make some leaders successful in the organizations they run, and other make the business fail. Great leaders are researchers, and they are careful in the decisions they make. Decisions are the steps or the course of actions that managers undertake regarding employment of the employees, decision as to the manufacturing processes, marketing procedures in the organization. The better decision is the backbone of any organization success.
Business may find it hard to balance between their needs and the needs of the customers. However, for companies to ensure that they make a balance between their needs, the needs of the clients and the standards or now they can look the following factors; environmental research is appropriate to ensure that they now the current developments. The needs of the stakeholders must be well identified to ensure no conflicts of interest that may arise between them and the organization. The organization should also prioritize the needs the stakeholders and their needs. To know how the customers, feel about the goods of the company the managers should provide mechanisms on how customers may give feedback on the property and services they receive. Accountability is a key element to the leadership of any organization. In the case of any mistake or dissatisfaction of the customers, the managers must take responsibility to be able to solve the needs of them amicably. These will enable the organization to makes changes to satisfy the needs of the customers entirely.
Organization observance to the ethical issues has many benefits to the organization and the stakeholders. The business is assured of continuity as they have the loyalty of the customers or the interested parties and this ensures high sales. Conflicts between the companies and the stakeholders are always prevalent, and they are reduced if the managers observe the standards set out during catering for their needs. The positive relation between the business and the customers as it ensures that the client's attraction is high to the goods and services of the firms. When the business relates well with the customers, it means that it has a competitive edge in the market and this is very healthy for ensuring survival in the market. A good relationship with stakeholders reduce employees’ turnover, and this reduces the cost or hiring and firing employees for the organization. The business needs support by the society it operates in since they are first customers to the products of the company. Good relationships with the community by the firm with facilitate its success.
However, a business cannot have any wrangles with the stakeholders, and this may be caused by various factors. The interest between the two parties are different and to sometimes disagreement may arise, but it is okay to disagree among businesses and the stakeholders. Measures, therefore, must be taken into account to solve the conflicts. The issue of prioritizing the stakeholders may bring conflicts since some are seen more important than the others. Some speakers may feel sick due to the discrimination they face from the businesses. Disputes may be attributable to unreasonable demands by the customers; this may be like requesting high salaries, low prices for the products, stealing firm's products and also being involved in corruption deals.
Leaders are the people who run the organizations as they make rules that are followed by all the stakeholders in their operation. There is the need for the manager to consult all the people when making any decision for the organization. Ethical dilemmas are common to the business as the decisions made may conflict. Solutions must be sought to solve the disputes and ensure business continue as normal. Leaders must be visionary and be able to forecast what is expected and enable better decisions to be undertaken by the organization. They should find a new market for the products. Remuneration and compensation of the efforts of the employees may boost its performance as they are motivated to work hard. The business environment must be safe for the workers and take into consideration their needs and wants. Cooperation within the organization between the management and the employees is critical for better service and production of goods. Managers should ensure that the products that are produced meet the requirements of the law and also the stakeholders. There are theories that explain the leadership traits of the managers;
The trait theory
This theory suggests that leaders are born with that element of leadership in them. The items in leaderships are the ones that make them unique from the other leaders. The leaders have a quality which makes them do better than others, and this includes creativity qualities, sense of responsibility and other conditions. All these qualities vary from one person to another and are the ones that make them distinct from others (Matthews, Deary & Whiteman, 2003, p. 3).
These are qualities that arise from how people handle themselves with manners, responsible and courage making them be seen as leaders since they have the ability to show the direction to the other people.
Leaders are risk takers, but take risks after carefully evaluating the consequences that may result afterward. Decisions made must have a reason underneath them. The decision has many stages before they can actualize or put into action. The decision must be identified by the managers. Information must be gathered on the decision to be undertaken by the management. All the alternatives must be evaluated to see the best decision that can be taken. Evidence of the different decisions should be measured to see the decision that looks more appropriate to the organization is executed. The choice must be made among the alternatives provided and the most suitable chosen. The decision best qualified should be then put into action by the leaders. Eventually, feedback should be made available on how the decision affected the organization. The aim of each decision is to ensure high sales for the group, if the decision is profitable, it should be implemented and made as a law for the organization to be followed (Saaty, 2008, pp.83-98).
The success of the business is a collective responsibility for all the stakeholders. No matter how the speaker is small, he has a duty to play in the high performance of the organization. The organization is investments by the business people and losses are not among the reasons for formation. Leaders chosen to lead an organization must be willing and able to offer leadership skill to the other staff. Rules and regulations they set must be observed by all and no deviations of any kind. Business activities are risky projects but the higher the risk, the higher the benefit and business people should not be afraid of uncertainties.
Finally, better management for the companies will determine its success, and the owners must choose leaders with reputation and able to run the business well. Leaders can ensure the organizations are run by the norms or standards for the stakeholders by knowing the standards and incorporating them in the rules of the society. When the relationship between the organization and stakeholders is good the business will automatically grow and become successful.
Carroll, A. B. (1991). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business horizons, 34(4), 39-48.
Carter, E. E. (1971). The behavioral theory of the firm and top-level corporate decisions. Administrative Science Quarterly, 413-429.
Fisher, B. A., & Ellis, D. G. (1980). Small group decision making: Communication and the group process. New York: McGraw-Hill.
Hansen, N. D., & Goldberg, S. G. (1999). Navigating the nuances: A matrix of considerations for ethical-legal dilemmas. Professional Psychology: Research and Practice, 30(5), 495.
Kim, W. C., & Mauborgne, R. (2004). Blue ocean strategy. If you read nothing else on strategy, read thesebest-selling articles., 71.
Lo, B. (2012). Resolving ethical dilemmas: a guide for clinicians. Lippincott Williams & Wilkins.
Matthews, G., Deary, I. J., & Whiteman, M. C. (2003). Personality traits. Cambridge University Press.
Mauborgne, R. (2005). Blue Ocean Strategy. Penerbit Serambi.
McWilliams, A., & Siegel, D. (2001). Corporate social responsibility: A theory of the firm perspective. Academy of management review, 26(1), 117-127.
Northouse, P. G. (2012). Leadership: Theory and practice. Sage.
Rhodes, M. L. (1986). Ethical dilemmas in social work practice.
Rost, J. C. (1998). Leadership and management. Leading organizations: Perspectives for a new era, 397-114.
Saaty, T. L. (2008). Decision making with the analytic hierarchy process. International journal of services sciences, 1(1), 83-98.
Trevino, L. K. (1986). Ethical decision making in organizations: A person-situation interactionist model. Academy of management Review, 11(3), 601-617.
Weathersby, G. B. (1999). Leadership vs. management. Management Review, 88(3), 5.